MONEY MARKET FUND
INSTITUTIONAL MONEY MARKET FUND
U.S. GOVERNMENT MONEY MARKET FUND
U.S. TREASURY MONEY MARKET FUND
TAX-EXEMPT MONEY MARKET FUND
SHORT-TERM BOND MARKET FUND
INTERMEDIATE BOND MARKET FUND
TAX-EXEMPT INTERMEDIATE BOND FUND
BOND IMMDEXTM FUND
BALANCED INCOME FUND
BALANCED GROWTH FUND
GROWTH AND INCOME FUND
EQUITY INDEX FUND
GROWTH FUND
SPECIAL GROWTH FUND
EMERGING GROWTH FUND
MICROCAP FUND
INTERNATIONAL EQUITY FUND
ANNUAL REPORT
OCTOBER 31, 1999
(LOGO) FIRSTAR FUNDS
<PAGE>
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NOTICE TO INVESTORS
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- Shares of Firstar Funds:
- ARE NOT INSURED BY THE FDIC, the US
Government or any other
governmental agency;
- are not bank deposits or
obligations of or guaranteed by
Firstar Bank, its parent company or
its affiliates;
- are subject to investment risks,
including possible loss of
principal; and
- are offered by B.C. Ziegler and
Company, member NASD,
SIPC, and an independent third-
party distributor.
- There can be no assurance that the
money market funds will be able to
maintain a stable net asset value
of $1.00 per share.
- Firstar Bank affiliates serve as
investment adviser, custodian,
transfer agent, administrator, and
accounting services agent
and receive compensation for such
services as disclosed in the
current prospectus.
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TABLE OF CONTENTS
Page(s)
Shareholder Letter................................................1-3
EQUITY FUNDS
Firstar Balanced Income...........................................4-5
Firstar Balanced Growth...........................................6-7
Firstar Growth and Income.........................................8-9
Firstar Equity Index............................................10-11
Firstar Growth..................................................12-13
Firstar Special Growth..........................................14-15
Firstar Emerging Growth.........................................16-17
Firstar MicroCap................................................18-19
Firstar International Equity....................................20-21
Statement of Assets and Liabilities.............................22-23
Statement of Changes in Net Assets..............................24-26
Statement of Operations.........................................27-28
Financial Highlights............................................30-39
Schedule of Investments.........................................40-71
Page(s)
BOND FUNDS
1999: The Flip Side of 1998.....................................72-73
Firstar Short-Term Bond Market..................................74-75
Firstar Intermediate Bond Market................................76-77
Firstar Tax-Exempt Intermediate Bond............................78-79
Firstar Bond IMMDEX_............................................80-81
Statement of Assets and Liabilities................................82
Statement of Changes in Net Assets.................................83
Statement of Operations............................................84
Financial Highlights............................................86-91
Schedule of Investments........................................92-102
MONEY MARKET FUNDS
Shareholder Letter................................................104
Yield Comparisons.................................................105
Statement of Assets and Liabilities...............................106
Statement of Operations...........................................107
Statement of Changes in Net Assets............................108-109
Financial Highlights..........................................110-111
Schedule of Investments.......................................112-119
NOTES TO THE FINANCIAL STATEMENTS.............................120-130
REPORT OF INDEPENDENT ACCOUNTANTS.................................131
<PAGE>
(LOGO) FIRSTAR FUNDS
DEAR SHAREHOLDER:
December 1999
THE YEAR IN REVIEW
At year-end (December 31), the current U.S. economic expansion will tie the
record 35-quarter expansion enjoyed by our economy from 1961 to 1969. According
to Salomon Smith Barney investment strategist John Manley, this isn't just good
luck. Speaking at our annual Institutional Investment Management Conference in
September, Manley asserted that our economy has been nearly perfect these past
several years because anything less than perfection has been instantaneously and
brutally dealt with by the capital markets, especially the bond market. The bond
market acts like a thermostat on the U.S. economy, pushing interest rates up
when too-fast growth threatens higher inflation and bringing rates down when
too-slow growth threatens recession. Manley contends this process is still
working. What the Fed and the capital markets are trying to do now is slow down
the U.S. consumer. We cannot have a booming U.S. consumer at the same time Asia
and Latin America recover. That would be inflationary and not sustainable. We
successfully slowed our economy twice before, in 1984 and 1994, when inflation
fears mounted and the Fed embarked on a mid-course tightening, thereby
engineering a soft landing for the U.S. economy. We expect the process to be
successful again, extending this unprecedented run of non-inflationary economic
growth.
In recent speeches, Federal Reserve Chairman Alan Greenspan has talked
extensively about the information technology revolution, highlighting how it has
accelerated productivity growth and raised living standards. America enjoys many
advantages when it comes to the development and exploitation of new
technologies. America is the world's leading spender on research and development
with outlays double our nearest rival, Japan. In addition, the entrepreneurial
culture in America ensures that technological advances are fully exploited
commercially. Individuals can start businesses with ease in the U.S., in sharp
contrast to Europe and Asia. Changes in public policy over the last 20 years
also contribute to America's technological advantage. The 1980's Reagan
revolution, with its policies of deregulation and tax reform, increased
incentives and rewards for innovators and risk takers. Finally, the openness of
U.S. trade policy makes the U.S. economy highly competitive. Competition fosters
innovation. If the U.S. can preserve the environment that hatches inventions, we
can look forward to further advances in technology, advances which can extend
America's global economic advantage and further enhance U.S. living standards.
<PAGE>
(LOGO) FIRSTAR FUNDS
ECONOMIC & MARKET OUTLOOK
Looking ahead, our market forecast is predicated on the following trends:
- - 1999 marks the third consecutive year of 4%+ inflation-adjusted economic
growth while inflation has averaged just 2% annually, the best three-year
economic performance in 30+ years.
- - Although aided in 1999 by economic recovery in Asia and upturns in Europe
and Japan, U.S. economic growth continues to be driven by consumer
spending.
- - U.S. consumer spending remains strong despite higher interest rates and
higher energy prices. The "wealth effect" from higher stock and home
prices, coinciding with peak consumer confidence thanks to low
unemployment, is offsetting the increase in rates and oil prices.
- - Although up from its 1998 lows, inflation remains remarkably tame given low
unemployment and a record U.S. economic expansion.
- - Wage gains have turned up but are restrained due to labor force "churn" as
a result of ongoing layoffs from mergers, acquisitions and restructurings.
- - Competition from the Internet, increased foreign trade and deregulation
limits the ability of firms to raise prices, keeping inflation in check.
- - An improved government policy mix featuring stable money and budget
surpluses helps keep inflation low.
- - Globalization and the information technology revolution allow firms to
improve productivity, enabling profits to expand despite rising
compensation costs (wages and benefits).
- - The bond market is fulfilling its thermostat function, pushing up long-term
interest rates to slow down the economy before inflation pressures build.
- - The Federal Reserve is likely to continue following the bond market,
raising short-term interest rates to slow down the U.S. economy (the Fed
may reason it needs to slow down the stock market to slow down the
consumer).
- - Although higher interest rates pose a short-term valuation risk for the
stock market, high stock valuations (price-to-earnings ratios) are
sustainable over the long-term due to the disinflationary nature of today's
dominant secular economic trends and the positive profit implications of
technology-enabled productivity gains and efficiencies achieved through
mergers and restructurings.
<PAGE>
(LOGO) FIRSTAR FUNDS
TECHNOLOGY - A TOPIC WORTHY OF FURTHER DISCUSSION
Given the profound impact technology has had on the economy, we feel it merits
discussion relative to our investment philosophy in general and our fund
performance in particular.
Bluntly stated, diversification across industry groups has not been a winning
strategy this year. A heavy concentration in technology stocks is clearly the
distinguishing characteristic between winning portfolios and losing portfolios.
While chasing internet and the 'mega' technology stocks may offer rewards in the
short term, it may prove disappointing over time. We contend an appropriate
allocation among large-, mid- and small-cap stocks is the best way to win the
investment marathon. Each of our equity portfolio managers offers a detailed
analysis of the technology sector and its impact on our equity portfolios. Be
sure to read their insightful write-ups in the equity section of this report.
IN OTHER NEWS
The Firstar MicroCap Fund will close to new investors on January 14, 2000.
Current shareholders of the Fund will be permitted to make additional
contributions to their existing accounts or open new accounts for which an
existing shareholder is full or partial owner. After a year of strong
appreciation and cash inflows, we feel it is important to control new
investments in order to maintain the integrity of the Fund. We continue to
believe microcap stocks represent an excellent long-term opportunity.
For more information regarding Firstar MicroCap Fund or any Firstar fund, call
us at 1-800-677-FUND.
On the technology front, shareholders continue to tap into the wealth of
information accessible via our web site at www.firstarfunds.com. The site
provides shareholders with timely access to fund diagnostics and also features
convenient transactional capabilities. If you haven't visited recently, log on!
And finally, in a prospectus supplement sent to you a few weeks ago, we
announced our upcoming merger with Mississippi Valley Advisors, the investment
advisory arm of Mercantile Bancorporation with whom Firstar merged in September.
The current staff, investment philosophy and investment process will remain
intact within both firms. We're pleased to report these expanded resources will
allow us to enhance the management teams on our equity funds _ aligning each
portfolio manager with the funds we believe best match his or her skills and
experience.
As always, we encourage you to write or call if you have comments regarding
portfolio performance or our investment strategy.
Thank you for your continued confidence in Firstar Funds.
Sincerely yours,
(PHOTO) (PHOTO)
MARY ELLEN STANEK, CFA MARIAN ZENTMYER, CFA, CFP
President and Chief Equity Investment Officer Chief Executive Officer
Firstar Investment Research & Management Company, LLC (FIRMCO)
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(LOGO) FIRSTAR FUNDS
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BALANCED INCOME FUND
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Firstar Balanced Income Fund seeks to provide current income and preserve
capital by investing in stocks and bonds. Typically, the Fund will invest 50% of
assets in common stocks of large, dividend-paying equity securities, with the
balance invested in intermediate-term high quality bonds and money markets. As
of October 31, 1999, the Fund consisted of 47% in common and preferred stocks,
43% in bonds, and 10% in money markets. The weighted average market
capitalization of the common stocks was $50 billion, considerably less than the
$116 billion average market capitalization of the Standard & Poor's 500 Stock
Index. Bond holdings within the portfolio had a weighted average duration of 3.5
years, matching the duration of the Lehman Brothers Intermediate
Government/Corporate Bond Index. For the 12 months ended October 31, 1999,
Firstar Balanced Income Fund returned +6.3% (Institutional shares), compared
with the return of 12.6% for the Lipper Balanced Fund Index.
For the fiscal year ended October 31, 1999, the Standard & Poor's 500 advanced
25.7%, propelled by a 69.4% gain for the technology sector. In fact, technology
stocks contributed over 40% of the return, with Microsoft, Cisco, Lucent, Intel
and America Online responsible for one-quarter of the S&P 500's 12-month return.
The Standard & Poor's 500 return without technology was +15.1%. Strength was
also seen in communication services stocks, with the sector's +31% return driven
by MCI Worldcom and Nextel. The consumer cyclicals sector also beat the Index
return, posting a +28% gain led by Wal-Mart and Home Depot. What is notable
regarding these top-performing companies is their high relative price-to-
earnings (P/E) ratios, averaging 64 times 1999 earnings, and their low dividend
yield, averaging .1%. This was a challenging environment given the Balanced
Income Fund's focus on income-producing securities at attractive multiples.
The equity portion of the Balanced Income Portfolio focuses on companies that
pay a dividend. Our strategy in managing the equity portion of the portfolio is
to own companies that demonstrate predictable sales and earnings growth, strong
balance sheets, and innovative management. (Standard & Poor's awards a stock
rating of "A" to "A+" to companies with these characteristics, while companies
with inconsistent or negligible earnings histories and questionable balance
sheets receive ratings of "C" or "D.") We believe over a long period of time
this strategy results in competitive, risk-adjusted returns for our
shareholders. This was not, however, a winning strategy for the fiscal year
ended October 31, which witnessed higher quality (A-rated) companies up 5.8%
versus lower quality companies (C&D-rated) up 48.4%.
The goal of the fixed-income component of Firstar Balanced Income Fund is to
provide an annual rate of total return comparable to the return of the Lehman
Brothers Intermediate Government/Corporate Bond Index. After the dramatic
widening of yield spreads in non-Treasury sectors last year, we selectively
added to our holdings in the corporate, asset-backed and mortgage-backed
sectors. The subsequent tightening of yield spreads in these sectors in 1999 has
contributed to the performance of the Fund over the last 12 months. Our careful,
research-intense process of selecting investment-grade issues in these sectors
gives the Fund a high-quality focus. Over 70% of the fixed-income portion of the
Fund is invested in obligations rated Aaa/AAA or higher. Among corporate bonds,
we have a preference for finance, banking and brokerage issues along with
dollar-denominated international ("Yankee") securities. We think these
sectors represent exceptional value moving forward. The hallmark of our fixed-
income approach is our consistent, risk-controlled style in all market climates.
The Balanced Income Fund is designed to reduce risk by investing in conservative
stocks and conservative bonds. The Fund's stocks have not been rewarded in the
current environment, but we believe that predictable earnings growth from
undervalued companies will be rewarded in this fast-changing market.
Thank you for your support of Firstar Balanced Income Fund.
PORTFOLIO MANAGER PROFILE
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PHOTO PHOTO
MARIAN E. ZENTMYER, WARREN D. PIERSON, CFA
CFA, CFP
MARIAN E. ZENTMYER, CFA, CFP, Chief Equity Investment Officer of Firstar
Investment Research & Management Company, LLC (FIRMCO) and WARREN D. PIERSON,
CFA, Senior Vice President and Senior Portfolio Manager co-manage the Fund _
Marian since its inception on January 1, 1989 and Warren since July 1, 1995.
Marian has been with Firstar since 1982 and has 21 years of investment
management experience. She received her BA from Stanford University in 1978.
Warren has been with Firstar since 1985 and has 14 years of investment
management experience. Warren received his BA from Lawrence University in 1984.
Marian is a Certified Financial Planner and a Chartered Financial Analyst.
Warren is a Chartered Financial Analyst.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR BALANCED LIPPER
INCOME FUND - BALANCED FUND
INSTITUTIONAL INDEX S&P 500
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12/1/97 10,000 10,000 10,000
10/98 11,270 10,854 11,659
10/99 11,984 12,217 14,652
This chart assumes an initial investment of $10,000 made on 12/1/97 (inception).
Performance reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced. Performance is shown for Institutional shares, which
have lower expenses than Series A or Series B shares. If those fees and expenses
were reflected in the chart above, total return would have been reduced. Returns
shown include the reinvestment of all dividends and other distributions. Past
perform ance is not predictive of future performance. Investment return and
principal value will fluc tuate, so that your shares, when redeemed, may be
worth more or less than their original cost.
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AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1999
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1 Year Since Inception
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FIRSTAR BALANCED INCOME
FUND - INSTITUTIONAL 6.3 9.9 (12/1/97)
FIRSTAR BALANCED INCOME FUND -
A - NO LOAD 6.0 9.6 (12/1/97)
FIRSTAR BALANCED INCOME FUND -
A - LOAD<F2> 1.2 7.0 (12/1/97)
FIRSTAR BALANCED INCOME FUND -
B - NO LOAD - 2.0 (3/1/99)<F1>
FIRSTAR BALANCED INCOME FUND -
B - LOAD<F3> - (3.0)(3/1/99)<F1>
LIPPER BALANCED FUND INDEX<F4> 12.6 11.0 (12/1/97)
S&P 500 STOCK INDEX<F5> 25.7 22.1 (12/1/97)
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A= Series A (Retail shares)
B= Series B (Retail shares)
<F1> Series B performance for the period March 1, 1999 to October 31, 1999 is
not annualized.
<F2> Reflects maximum sales charge of 4.50%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The Lipper Balanced Fund Index is composed of the 30 largest mutual funds
whose primary objective is to conserve principal by maintaining a balanced
portfolio of stocks and bonds.
<F5> The S&P 500 Stock Index is an index of an unmanaged group of 500 selected
common stocks, most of which are listed on the New York Stock Exchange. The
Index is heavily weighted toward stocks with large market capitalizations
and represents approximately two-thirds of the total market value of all
domestic common stocks.
An investment cannot be made directly in an index.
Series A shares have a 4.50% maximum sales load and are subject to an annual
0.25% service organization fee. Series B shares have a 5.00% maximum deferred
sales charge and are subject to an annual 0.25% service organization fee and a
0.75% 12b-1 fee. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/99
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ALLTELL CORPORATION 2.1%
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BRISTOL-MYERS SQUIBB COMPANY 1.4%
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TYCO INTERNATIONAL, LTD. 1.4%
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INTERPUBLIC GROUP OF COMPANIES, INC. 1.3%
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WELLS FARGO COMPANY, INC. 1.3%
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Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/99
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$64,386,218
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<PAGE>
(LOGO) FIRSTAR FUNDS
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BALANCED GROWTH FUND
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Firstar Balanced Growth Fund seeks capital appreciation combined with reasonable
income by investing in stocks and bonds. Typically, the Fund will invest 60% of
assets in common stocks of large-, medium- and small-sized companies, with the
balance invested in high quality bonds and money markets. As of October 31,
1999, the Fund consisted of 62% in common stocks, 37% in bonds and 1% in money
markets. The weighted average market capitalization of the common stocks was
$52.5 billion, considerably less than the $116 billion average market
capitalization of the Standard & Poor's 500 Stock Index. Bond holdings within
the portfolio had a weighted average duration of 5.4 years, matching the
duration of the Lehman Brothers Intermediate Government/Corporate Bond Index.
For the 12 months ended October 31, 1999, Firstar Balanced Growth Fund returned
5.9% (Institutional shares), compared with the return of 12.6% for the Lipper
Balanced Fund Index.
The world witnessed a remarkable change in economic circumstances in 1999. You
may recall high economic stress in 1998 led to three interest rate reductions by
the Federal Reserve. The rebound in the world economy in 1999 saw the Fed
reverse itself with three rate increases. Stock prices began the fiscal year
with a dramatic increase, with the S&P 500 returning 22.3% during the first six
months. The change in investor perception from low inflation and low interest
rates to higher inflation and interest rate risk slowed the market advance, with
the S&P 500 up 2.7% during the last half of the fiscal year. Technology stocks
led all others during the year with a phenomenal 69.4% return for the S&P
technology sector. This return was responsible for nearly half of the total
return of the Index, making diversification a losing strategy for the full year.
Our sector bet in technology and consumer cyclicals had a positive impact on the
portfolio. Offsetting this, however, was an overweighted position in financials,
which performed poorly in the face of high interest rates. Our 30%
portfolio weight to small- and mid-cap stocks also detracted from results as
these sectors continued to underperform the large-cap dominated S&P 500.
The objective of the fixed-income component of Firstar Balanced Growth Fund is
to provide an annual rate of total return comparable to the return of the Lehman
Brothers Intermediate Government/Corporate Bond Index. Our careful, research-
intensive process of selecting investment-grade corporate issues, mortgage- and
asset-backed securities gives the Fund a high-quality focus. One-half (50%) of
the fixed-income portion of the Fund is invested in obligations rated Aaa/AAA or
higher. Among corporate bonds, we have a preference for finance, banking and
brokerage issues along with dollar-denominated international ("Yankee")
securities. We believe these sectors represent exceptional value in the current
environment. Since the Fund's inception in 1992, we have adhered to the same
disciplined management approach. While the past seven years have brought us more
volatility in the fixed-income markets than many would have expected, we have
applied our consistent, risk-controlled style in all market climates.
During fiscal 1999, the stock market rewarded only the largest companies with
good price performance; however, we believe this trend is nearing exhaustion.
History has proven great returns are earned by investing in reasonably valued
companies of little notoriety. Today, that area is the small and medium-sized
area of the stock market. Firstar Balanced Growth Fund is among the few balanced
funds with a large commitment in these companies. With good value in our stock
holdings, and bonds offering 4-5% real yield (after inflation), we are excited
about the prospects for the Fund in the coming year.
Thank you for your continued confidence in Firstar Balanced Growth Fund.
PORTFOLIO MANAGER PROFILE
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(PHOTO) (PHOTO)
MARIAN E. ZENTMYER, DANIEL A. TRANCHITA,
CFA, CFP CFA
MARIAN E. ZENTMYER, CFA, CFP, Chief Equity Investment Officer of Firstar
Investment Research &Management Company, LLC (FIRMCO) and DANIEL A. TRANCHITA,
CFA, Senior Vice President and Senior Portfolio Manager co-manage the Fund,
Marian since June 18, 1996, and Dan since March 1, 1999. Marian has been with
Firstar since 1982 and has 21 years of investment management experience. She
received her BA from Stanford University in 1978. Dan has been with Firstar
since 1989 and has 10 years of investment management experience. He received his
BA in 1987 and his MBA in 1989 from Marquette University. Marian is a Certified
Financial Planner and a Chartered Financial Analyst. Dan is a Chartered
Financial Analyst.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR BALANCED LIPPER
GROWTH FUND - BALANCED FUND S&P 500 STOCK
INSTITUTIONAL INDEX INDEX
---------------- ---------------- -----------------
3/30/92 10,000 10,000 10,000
10/92 10,372 10,481 10,548
10/93 11,771 12,167 12,124
10/94 11,662 12,093 12,593
10/95 13,969 14,220 15,923
10/96 15,724 16,281 19,760
10/97 18,615 19,553 26,106
10/98 20,260 21,657 31,846
10/99 21,449 24,377 40,021
This chart assumes an initial investment of $10,000 made on 3/30/92 (inception).
Performance reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced. Performance is shown for Institutional shares, which
have lower expenses than Series A or Series B shares. If those fees and expenses
were reflected in the chart above, total return would have been reduced. Returns
shown include the reinvestment of all dividends and other distributions. Past
performance is not predictive of future performance. Investment return and
principal value will fluctuate, so that your shares, when redeemed, may be worth
more or less than their original cost.
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AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1999
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1 Year 3 Years 5 Years Since Inception
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FIRSTAR BALANCED
GROWTH FUND - INSTITUTIONAL 5.9 10.9 13.0 10.6 (3/30/92)
FIRSTAR BALANCED
GROWTH FUND - A - NO LOAD 5.6 10.6 12.7 10.4 (3/30/92)
FIRSTAR BALANCED
GROWTH FUND - A - LOAD<F2> 0.8 8.9 11.7 9.7 (3/30/92)
FIRSTAR BALANCED
GROWTH FUND - B - NO LOAD - - - 0.3 (3/1/99)<F1>
FIRSTAR BALANCED
GROWTH FUND - B - LOAD<F3> - - - (4.7) (3/1/99)<F1>
LIPPER BALANCED FUND INDEX<F4> 12.6 14.5 15.1 12.5 (3/30/92)
S&P 500 STOCK INDEX<F5> 25.7 26.5 26.0 20.0 (3/30/92)
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A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1, 1999 to
October 31, 1999 is not annualized.
<F2> Reflects maximum sales charge of 4.50%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The Lipper Balanced Fund Index is composed of the 30 largest mutual
funds whose primary objective is to conserve principal by maintaining
a balanced portfolio of stocks and bonds.
<F5> The S&P500 Stock Index is an index of 500 selected common stocks, most
of which are listed on the New York Stock Exchange. The Index is
heavily weighted toward stocks with large market capitalizations and
represents approximately two-thirds of the total market value of all
domestic common stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 4.50%
maximum sales load and are subject to an annual 0.25% service organization fee.
The load performance for the Series A shares has been restated to reflect the
impact of the current sales charge. Series A performance prior to January 10,
1995, does not reflect the service organization fees. If service organization
fees had been reflected, performance would be reduced. Series B shares have a
5.00% maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/99
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AMERICAN INTERNATIONAL GROUP 1.1%
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MICROSOFT CORPORATION 1.0%
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SUNGARD DATA SYSTEMS 1.0%
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STATE STREET CORPORATION 1.0%
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PROTECTIVE LIFE CORPORATION 1.0%
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Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/99
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$235,174,312
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<PAGE>
(LOGO) FIRSTAR FUNDS
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GROWTH AND INCOME FUND
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For the fiscal year ended October 31, 1999, the Standard & Poor's 500 advanced
25.7%, propelled by a 69.4% gain for the technology sector. In fact, technology
stocks contributed over 40% of the return, with the "big five" - Microsoft,
Cisco, Lucent, Intel and America Online - responsible for one-quarter of the S&P
500's 12-month return. The Standard & Poor's 500 return without technology was
+15.1%. Strength was also seen in communication services stocks, with the
sector's +31% return driven by MCI WorldCom and Nextel. The consumer cyclicals
sector also beat the Index return, posting a +28% gain led by Wal-Mart and Home
Depot. What is notable regarding these top-performing companies is their high
relative price-to-earnings (P/E) ratios, averaging 64 times 1999 earnings, and
their low dividend yield, averaging .1%. Naturally this was a tough environment
for the Firstar Growth and Income Fund, which focuses on income-producing
securities at attractive multiples. Against the "headwinds," the Fund returned
+12.1% (Institutional shares) for the year.
In the Growth and Income Fund, we focus on the stocks of high quality companies
with predictable sales, earnings and cash flow growth, strong balance sheets and
innovative management. Standard & Poor's awards a stock rating of "A-" to "A+"
to companies with these characteristics. Companies with inconsistent or
negligible earnings histories and questionable balance sheets receive ratings of
"C" or "D." The Growth and Income portfolio has an average quality rating of "A-
." For the 12 months ended October of 1999, the lowest quality stocks were the
best performers, with "C" and "D"-rated companies up 48.4%. Companies with "A-"
ratings or greater were up a modest 5.8%.
The Growth and Income Fund focuses on companies that pay a dividend.
Historically this strategy has produced returns which are competitive in up
markets and outperform in down markets. The 22.4% annual return of the Growth
and Income Fund over the last five years is competitive with a +26.0% annual
gain for the Standard & Poor's 500 and a 20.1% return posted by the average
growth and income fund as measured by Morningstar. The Firstar Growth and Income
Fund is our most conservative equity fund, with a focus on providing competitive
risk-adjusted returns. The Fund, according to Morningstar, has experienced only
83% of the volatility of the S&P 500 and 88% of the volatility of the average
growth and income fund over the last five years. This combination of competitive
investment returns and low volatility gives the fund high marks for risk-
adjusted returns. We recognize, however, that this strategy does not work in all
market environments. The technology-driven market we have experienced over the
last 12 months is a case in point. Technology stocks generally do not pay
dividends and if they do, the payout is quite modest. The traditionally
defensive groups currently emphasized in the portfolio, including financials,
consumer staples and healthcare, posted 12-month returns of +19.5%, -.10% and
+10.4%, respectively. Simply stated, we own the sectors and the stocks that the
market is not favoring this year. This is a complete reversal from our 1998
experience when these groups, dominated by high quality companies, were in
favor.
The market's disdain for high quality companies over the last 12 months gave us
the opportunity to add a number of new companies to the portfolio at attractive
prices. Recent purchases for the Growth and Income Fund include Vulcan Materials
(we believe a major beneficiary of recent transportation legislation which will
increase highway construction spending by over 40% during the next several
years); Eli Lilly (a major pharmaceutical company with several promising new
drugs including Actos for Type II diabetes); Time Warner (the world's largest
media and entertainment company and, we believe, a beneficiary of the Internet
economy); and Walgreen's (one of America's largest drug retailers and an
indirect beneficiary of aging demographics and many successful new drug
launches).
As we approach the millennium, we believe the best opportunities in the market
are the 450 smaller companies within the S&P 500. Companies within this sector
with strong fundamentals should play catch-up to the lofty price-to-earnings
multiples of the "top 50." We are investing accordingly, with a $50 billion
average weighted market capitalization for the companies held in the Growth and
Income Fund versus a $116 billion average market capitalization for the Standard
& Poor's 500.
We thank you for your continued support.
PORTFOLIO MANAGER PROFILE
- ------------------------------------------------------------------------------
(PHOTO) (PHOTO)
MARIAN E. ZENTMYER, WALTER DEWEY, CFA
CFA, CFP
MARIAN E. ZENTMYER, CFA, CFP, Chief Equity Investment Officer of Firstar
Investment Research & Management Company, LLC (FIRMCO) and WALTER DEWEY, CFA,
Senior Vice President and Senior Portfolio Manager co-manage the Fund - Marian
since February 22, 1993 and Walter since June 29, 1998. Marian has been with
Firstar since 1982 and has 21 years of investment management experience. She
received her BA from Stanford University in 1978. Walter has been with Firstar
since 1986 and has 15 years of investment management experience. He received his
BBA in 1983 from the University of Wisconsin. Marian is a Certified Financial
Planner and a Chartered Financial Analyst. Walter is a Chartered Financial
Analyst.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR GROWTH AND
INCOME FUND - S&P 500 STOCK
INSTITUTIONAL INDEX<F4>
------------------ ------------------
12/29/89 10,000 10,000
10/90 9,304 8,855
10/91 11,698 11,821
10/92 12,368 12,999
10/93 13,596 14,941
10/94 13,846 15,519
10/95 17,307 19,622
10/96 21,963 24,351
10/97 28,734 32,170
10/98 34,008 39,244
10/99 38,103 49,318
This chart assumes an initial investment of $10,000 made on 12/29/89
(inception). Performance reflects fee waivers in effect. In the absence
of fee waivers, total return would be reduced. Performance is shown for
Institutional shares, which have lower expenses than Series A or Series B
shares. If those fees and expenses were reflected in the chart above, total
return would have been reduced. Returns shown include the reinvestment of all
dividends and other distributions. Past performance is not predictive of future
performance. Investment return and principal value will fluctuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
- -------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1999
- -------------------------------------------------------------------------------
1 Year 3 Years 5 Years Since Inception
- -------------------------------------------------------------------------------
FIRSTAR GROWTH AND
INCOME FUND - INSTITUTIONAL 12.0 20.2 22.4 14.6 (12/29/89)
FIRSTAR GROWTH AND
INCOME FUND - A - NO LOAD 11.8 19.9 22.2 14.4 (12/29/89)
FIRSTAR GROWTH AND
INCOME FUND - A - LOAD<F2> 6.8 18.0 21.0 13.9 (12/29/89)
FIRSTAR GROWTH AND
INCOME FUND - B - NO LOAD - - - 3.2 (3/1/99)<F1>
FIRSTAR GROWTH AND
INCOME FUND - B - LOAD<F3> - - - (1.8) (3/1/99)<F1>
S&P 500 STOCK INDEX<F4> 25.7 26.5 26.0 17.6 (12/29/89)
- -------------------------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1, 1999 to
October 31, 1999 is not annualized.
<F2> Reflects maximum sales charge of 4.50%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The S&P500 Stock Index is an index of 500 selected common stocks, most
of which are listed on the New York Stock Exchange. The Index is
heavily weighted toward stocks with large market capitalizations and
represents approximately two-thirds of the total market value of all
domestic common stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 4.50% maxi
mum sales load and are subject to an annual 0.25% service organization fee. The
load performance for the Series A shares has been restated to reflect the impact
of the current sales charge. Series A performance prior to January 10, 1995,
does not reflect the service organization fees. If service organization fees had
been reflected, performance would be reduced. Series B shares have a 5.00%
maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/99
- -----------------------------------------
ALLTELL CORPORATION 4.1%
- -----------------------------------------
BRISTOL-MYERS SQUIBB COMPANY 2.8%
- -----------------------------------------
TYCO INTERNATIONAL, LTD. 2.7%
- -----------------------------------------
INTERPUBLIC GROUP OF COMPANIES,INC. 2.6%
- -----------------------------------------
WELLS FARGO COMPANY, INC. 2.6%
- -----------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/99
- -----------------------------------------
$726,895,945
- -----------------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
- -------------------------------------------------------------------------------
EQUITY INDEX FUND
- -------------------------------------------------------------------------------
Firstar Equity Index Fund seeks to provide investment returns, before Fund
expenses, comparable to the price and yield performance of publicly traded
stocks in the aggregate, as represented by the S&P 500 Index. The Fund does not
use traditional methods of financial and market analysis when making purchase
and sale decisions; rather, the Fund invests primarily in common stocks that
comprise the S&P 500 Index in proportion to their relative capitalization and
sector weightings.
Firstar Equity Index Fund's net asset value of $91.95 (Institutional shares) on
October 31 represents a total return of 2.6% for the last six months of the
fiscal year, which was comparable to the S&P's return of 2.7% over the same
period.
We believe by applying a capitalization weighting and sector balancing technique
that matches the structure of the S&P 500, as well as using S&P 500 futures
contracts to equitize the cash, the Fund should reasonably track the performance
of the index.
PORTFOLIO MANAGER PROFILE
- -------------------------------------------------------------------------------
(PHOTO)
CARL J. SMITH
CARL J. SMITH, Assistant Vice President and Portfolio Manager of Firstar
Investment Research & Management Company, LLC (FIRMCO) has managed the Fund
since January, 1996. Carl has been with Firstar since 1982 and has seven years
of investment management experience. He received his BS in 1994 from Cardinal
Stritch College.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR EQUITY
INDEX FUND - S&P 500 STOCK
INSTITUTIONAL INDEX
--------------- ---------------
12/29/89 10,000 10,000
10/90 8,854 8,855
10/91 11,767 11,821
10/92 12,889 12,999
10/93 14,644 14,941
10/94 15,157 15,519
10/95 19,101 19,622
10/96 23,624 24,351
10/97 31,037 32,170
10/98 37,843 39,244
10/99 47,424 49,318
This chart assumes an initial investment of $10,000 made on 12/29/89
(inception). Performance reflects fee waivers in effect. In the absence of fee
waivers, total return would be reduced. Performance is shown for Institutional
shares, which have lower expenses than Series A or Series B shares. If those
fees and expenses were reflected in the chart above, total return would have
been reduced. Returns shown include the reinvestment of all dividends and other
distributions. Past performance is not predictive of future performance.
Investment return and principal value will fluctuate, so that your shares, when
redeemed, may be worth more or less than their original cost.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1 Year 3 Years 5 Years Since Inception
- -------------------------------------------------------------------------------
FIRSTAR EQUITY INDEX
FUND - INSTITUTIONAL 25.3 26.2 25.6 17.1 (12/29/89)
FIRSTAR EQUITY INDEX
FUND - A - NO LOAD 25.0 25.9 25.3 17.0 (12/29/89)
FIRSTAR EQUITY INDEX
FUND - A - LOAD<F2> 19.4 23.9 24.2 16.4 (12/29/89)
FIRSTAR EQUITY INDEX
FUND - B - NO LOAD - - - 9.9 (3/1/99)<F1>
FIRSTAR EQUITY INDEX
FUND - B - LOAD<F3> - - - 4.9 (3/1/99)<F1>
S&P 500 STOCK INDEX<F4> 25.7 26.5 26.0 17.6 (12/29/89)
A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1, 1999 to
October 31, 1999 is not annualized.
<F2> Reflects maximum sales charge of 4.50%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The S&P500 Stock Index is an index of 500 selected common stocks, most
of which are listed on the New York Stock Exchange. The Index is
heavily weighted toward stocks with large market capitalizations and
represents approximately two-thirds of the total market value of all
domestic common stocks.
"Standard & Poor's/R," "S&P/R," "S&P 500/R," "Standard &Poor's 500," and "500"
are trademarks of the McGraw Hill Companies, Inc. and have been licensed for use
by Firstar Funds. The Equity Index Fund is not sponsored, endorsed, sold or
promoted by Standard & Poor's and Standard & Poor's makes no representation
regarding the advisability of investing in the Equity Index Fund.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 4.50%
maximum sales load and are subject to an annual 0.25% service organization fee.
The load performance for the Series A shares has been restated to reflect the
impact of the current sales charge. Series A performance prior to January 10,
1995, does not reflect the service organization fees. If service organization
fees had been reflected, performance would be reduced. Series B shares have a
5.00% maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/99
- ----------------------------------------
MICROSOFT CORPORATION 4.0%
- ----------------------------------------
GENERAL ELECTRIC COMPANY 3.8%
- ----------------------------------------
INTEL CORPORATION 2.2%
- ----------------------------------------
WAL-MART STORES, INC. 2.2%
- ----------------------------------------
CISCO SYSTEMS, INC. 2.0%
- ----------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/99
- ----------------------------------------
$715,021,181
- ----------------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
- -------------------------------------------------------------------------------
GROWTH FUND
- -------------------------------------------------------------------------------
Firstar Growth Fund seeks long-term capital appreciation by investing in the
securities of large companies. As of October 31, 1999, the portfolio had a
weighted average market capitalization of $75.1 billion, up substantially from
the $48.9 billion on April 30, 1999. This compares with the Fund's primary
benchmark, the Standard & Poor's 500 (S&P 500), which had a weighted average
market capitalization of $116.1 billion on October 31. During the 12 months
ended October 31, the Growth Fund returned +18.2%, (Institutional shares)
trailing the S&P 500 +25.7%, and the Lipper Large Cap Core Fund average of
26.1%.
The last year has witnessed a remarkable change in economic circumstances for
the world economy and for the financial markets. High economic stress in 1998
led to three interest rate reductions by the Federal Reserve. The rebound in the
world economy in 1999 has seen the Fed reverse itself with three rate increases.
Stock prices began the fiscal year with a dramatic increase, with the S&P 500
returning 22.3% during the first six months. The change in investor perception
from low inflation and lower interest rates to higher inflation and interest
rate risk slowed the market advance, with the S&P 500 up 2.7% during the last
half of the fiscal year. Technology stocks led all others during the year with a
phenomenal 69.4% return for the S&P technology sector. This return was
responsible for nearly half of the total return of the index, making technology
stocks critical to Fund performance. No other sector contributed more than 11%
of the index return, making diversification a losing strategy for the full year.
Ironically, the year started in a higher-risk economic environment, and the best
returns were earned by those who took the greatest risk.
As we discussed in our mid-year report, the Fund started the year poorly in its
technology positions. Service company exposure was reduced in favor of those
companies which have more direct exposure to the construction of the Internet
and related communication services. New positions in Nortel and Sun Microsystems
appreciated over 50% during the last six months. Long-held positions in
Microsoft, Cisco Systems, Intel and First Data Systems were all up in excess of
50% for the full year, contributing 25% of the Fund's total return.
Additionally, advertising agency giants Omnicom and Interpublic Group were in
outstanding positions because of the surge in spending related to Internet
advertising. Large positions in Tyco, MCI WorldCom, Harley Davidson and American
International Group were also among the biggest contributors to return. A
significant reduction in our Tyco position was executed at the highest level of
prices during the year, making the stock's recent decline of less consequence.
The new year begins with the same themes driving the large company area of the
stock market. Technology stocks have roared to higher prices, taking their share
of the overall market to over 25%. This area has become the dominant sector in
the stock market, and we are determined to significantly improve our performance
in technology. New positions in JDS Uniphase, Qualcomm, Texas Instruments, Nokia
and EMC have already contributed to the portfolio performance. Our research
indicates that the lowest-risk way to invest in the explosive technology sector
is to own the leaders. Finance and health care companies represent good value
but are currently facing poor earnings growth (finance) or an election cycle
(health care) that are hindering their performance within the portfolio. We
believe better opportunities are ahead for these stocks. Finally, the consumer
continues to spend with a high degree of confidence. This gives us some
conviction that the next 12 months will be a good investment period for those
companies able to execute a profitable strategy in an increasingly competitive
world for consumer dollars.
We appreciate your continued support of Firstar Growth Fund.
PORTFOLIO MANAGER PROFILE
- ---------------------------------------------------------------------------
(PHOTO) (PHOTO)
MARIAN E. ZENTMYER, WALTER DEWEY, CFA
CFA, CFP
MARIAN E. ZENTMYER, CFA, CFP, Chief Equity Investment Officer of Firstar
Investment Research & Management Company, LLC (FIRMCO) and WALTER DEWEY, CFA,
Senior Vice President and Senior Portfolio Manager co-manage the Fund - Marian
since June 18, 1996 and Walter since July 7, 1997. Marian has been with Firstar
since 1982 and has 21 years of investment management experience. She received
her BA from Stanford University in 1978. Walter has been with Firstar since 1986
and has 15 years of investment management experience. He received his BBA in
1983 from the University of Wisconsin. Marian is a Certified Financial Planner
and a Chartered Financial Analyst. Walter is a Chartered Financial Analyst.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR
GROWTH FUND - S&P 500 STOCK
INSTITUTIONAL INDEX
--------------- -----------------
12/29/92 10,000 10,000
10/93 10,753 10,981
10/94 10,813 11,406
10/95 12,927 14,422
10/96 15,360 17,898
10/97 18,671 23,645
10/98 22,199 28,844
10/99 26,236 36,248
This chart assumes an initial investment of $10,000 made on 12/29/92
(inception). Performance reflects fee waivers in effect. In the absence
of fee waivers, total return would be reduced. Performance is shown for
Institutional shares, which have lower expenses than Series A or Series B
shares. If those fees and expenses were reflected in the chart above, total
return would have been reduced. Returns shown include the reinvestment of all
dividends and other distributions. Past performance is not predictive of future
performance. Investment return and principal value will fluctuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1 Year 3 Years 5 Years Since Inception
- -------------------------------------------------------------------------------
FIRSTAR GROWTH FUND -
INSTITUTIONAL 18.2 19.5 19.4 15.1 (12/29/92)
FIRSTAR GROWTH FUND -
A - NO LOAD 17.9 19.3 19.1 15.0 (12/29/92)
FIRSTAR GROWTH FUND -
A - LOAD<F2> 12.6 17.4 18.0 14.2 (12/29/92)
FIRSTAR GROWTH FUND -
B - NO LOAD - - - 2.3 (3/1/99)<F1>
FIRSTAR GROWTH FUND -
B - LOAD<F3> - - - (2.7) (3/1/99)<F1>
S&P 500 STOCK INDEX<F4> 25.7 26.5 26.0 20.7 (12/29/92)
A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1, 1999 to
October 31, 1999 is not annualized.
<F2> Reflects maximum sales charge of 4.50%.
<F3> Reflects maximum deferred sales charge of 5.00%
<F4> The S&P500 Stock Index is an index of 500 selected common stocks, most
of which are listed on the New York Stock Exchange. The Index is
heavily weighted toward stocks with large market capitalizations and
represents approximately two-thirds of the total market value of all
domestic common stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 4.50%
maximum sales load and are subject to an annual 0.25% service organization fee.
The load performance for the Series A shares has been restated to reflect the
impact of the current sales charge. Series A performance prior to January 10,
1995, does not reflect the service organization fees. If service organization
fees had been reflected, performance would be reduced. Series B shares have
a 5.00% maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/99
- -----------------------------------------
AMERICAN INTERNATIONAL GROUP 2.9%
- -----------------------------------------
MICROSOFT CORPORATION 2.8%
- -----------------------------------------
STATE STREET CORPORATION 2.8%
- -----------------------------------------
TYCO INTERNATIONAL, LTD. 2.8%
- -----------------------------------------
MCI WORLDCOM, INC. 2.7%
- -----------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/99
- -----------------------------------------
$354,792,347
- -----------------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
- --------------------------------------------------------------------------------
SPECIAL GROWTH FUND
- --------------------------------------------------------------------------------
For the fiscal year ended October 31, 1999, the Standard & Poor's MidCap 400
Index advanced 21.1%. The Firstar Special Growth Fund performed poorly against
its benchmark, returning 1.6% (Institutional shares) during this time period.
The Fund, however, underwent significant and noteworthy changes during the year.
In December, 1998, your current management took control of the portfolio which
consisted of approximately 55 names heavily concentrated in the finance,
consumer cyclical, healthcare and technology sectors, with the top ten positions
representing approximately 44% of the portfolio. Our initial objective in
December was to broaden the portfolio holdings list by adding superior quality,
mid-sized companies that had improving financial outlooks for calendar 1999.
Although we accomplished this initial objective, we did not instantly sell the
majority of the portfolio's positions which quickly proved to be a critical
mistake due to the portfolio's significant overweighting in the healthcare
services sector. In addition, a few individual technology company holdings fell
significantly in early 1999, resulting in the portfolio lagging behind the S&P
400 Index from the beginning of the fiscal and calendar years. We completed the
major restructuring of the portfolio in June of 1999. We have been encouraged by
the Fund's performance since then as it outperformed the S&P 400 Index during
the last fiscal year quarter and has begun fiscal year 2000 solidly with a
return above the Index.
The operating and financial results of the Fund's financial sector holdings,
such as Charles Schwab, Protective Life, Ambac and MGIC Investment Corporation,
have been solid, meeting or exceeding expectations throughout fiscal year 1999;
however, the 107 basis-point increase in long-term government bond interest
rates has had an extremely negative impact on the majority of financial stock
prices. The financial sector in the S&P 400 returned -2.6% from January 1, 1999
through October 31, 1999. The financial stocks we invested in outperformed
during this time period with a return of approximately +5.7%.
Stock price performance in the consumer cyclical sector has also been negatively
impacted by the rise in interest rates, with the S&P 400 consumer cyclical
sector returning 2.4% in calendar year 1999. We have maneuvered through this
difficult environment by focusing on companies with defensible market share.
Specifically, we have invested in the discount retail sector, owning companies
showing superior operating results, including BJ's Wholesale Clubs, Dollar
General and Family Dollar.
Unlike the finance and consumer cyclical sectors, the Fund's healthcare holdings
underperformed the benchmark as a result of poor operating results. At the
beginning of fiscal year 1999, the Fund had a significant overweighting in the
healthcare services sector with hospital management companies (Health Management
Associates and Universal Health Services), drug distributors to nursing homes
(Omnicare), and home oxygen providers (Lincare) representing 12.6% of the
portfolio. We underestimated the negative impact the Balanced Budget Act of 1997
would have on these companies. We have restructured the healthcare portion of
the portfolio to include a more diverse list of companies and are confident that
recent healthcare legislation for the fiscal year 2000 budget will have a
positive operating impact and lead to higher stock prices for your healthcare
holdings.
The performance of the technology sector of the Fund is similar to healthcare in
that individual stock performance of a few companies has caused significant
damage to the Fund's performance. We have added three new technology analysts
with an average of over seven years of experience to work on the Fund, and
positive results are already being seen. Recent successes from our new analysts
are evidenced in solid performance from Analog Devices, Comverse Technologies,
SDL and Xilinx.
Fiscal year 1999 was a difficult and critical year for the Fund. The returns
were poor during the first three quarters of the year, but improved noticeably
once the Fund was fully restructured. We are confident the additional research
we have put into the Fund will be rewarded going forward.
We appreciate your continued confidence in Firstar Special Growth Fund.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
(PHOTO) (PHOTO)
TODD M. KRIEG, CFA, JD MATTHEW D'ATTILIO, CFA
TODD KRIEG, CFA, JD, Senior Vice President and Senior Portfolio Manager of
Firstar Investment Research & Management Company, LLC (FIRMCO) and MATTHEW
D'ATTILIO, CFA, Senior Vice President and Senior Portfolio Manager co-manage the
Fund - Todd since September 1, 1994 and Matt since December 1, 1998. Todd has
been with Firstar since 1992 and has seven years of investment management
experience. He received his BA from Williams College in 1983 and a JD from
Georgetown University in 1989. Matt has been with Firstar since 1993 and has six
years of investment management experience. He received his BA from Bowdoin
College in 1993. Todd and Matt are both Chartered Financial Analysts.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR SPECIAL
GROWTH FUND - S&P
INSTITUTIONAL MIDCAP 400 S&P 500
--------------- ---------------- ----------------
12/28/89 10,000 10,000 10,000
10/90 8,953 8,293 8,855
10/91 14,346 13,360 11,821
10/92 15,617 14,804 12,999
10/93 18,138 17,992 14,941
10/94 18,641 18,420 15,519
10/95 23,449 22,327 19,622
10/96 26,399 26,200 24,351
10/97 32,323 34,760 32,170
10/98 30,494 37,092 39,244
10/99 30,969 44,908 49,318
This chart assumes an initial investment of $10,000 made on 12/28/89
(inception). Performance reflects fee waivers in effect. In the absence
of fee waivers, total return would be reduced. Performance is shown for
Institutional shares, which have lower expenses than Series A or Series B
shares. If those fees and expenses were reflected in the chart above, total
return would have been reduced. Returns shown include the reinvestment of all
dividends and other distributions. Past performance is not predictive of future
performance. Investment return and principal value will fluctuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
- -------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1999
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1 Year 3 Years 5 Years Since Inception
- -------------------------------------------------------------------------------
FIRSTAR SPECIAL GROWTH
FUND - INSTITUTIONAL 1.6 5.5 10.7 12.2 (12/28/89)
FIRSTAR SPECIAL GROWTH
FUND - A - NO LOAD 1.3 5.2 10.4 12.0 (12/28/89)
FIRSTAR SPECIAL GROWTH
FUND - A - LOAD<F2> (3.3) 3.6 9.4 11.5 (12/28/89)
FIRSTAR SPECIAL GROWTH
FUND - B - NO LOAD - - - 0.2 (3/1/99)<F1>
FIRSTAR SPECIAL GROWTH
FUND - B - LOAD<F3> - - - (4.8) (3/1/99)<F1>
S&P MIDCAP 400 INDEX<F4> 21.1 19.7 19.5 16.5 (12/28/89)
S&P 500 STOCK INDEX<F5> 25.7 26.5 26.0 17.6 (12/28/89)
- -------------------------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1,1999 to
October 31, 1999 is not annualized.
<F2> Reflects maximum sales charge of 4.50%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The S&P MidCap 400 Index is a capital-weighted index, representing the
aggregate market value of the common equity of 400 stocks chosen by
Standard & Poor's with a median capitalization of approximately $700
million.
<F5> The S&P500 Stock Index is an index of 500 selected common stocks, most
of which are listed on the New York Stock Exchange. The Index is
heavily weighted toward stocks with large market capitalizations and
represents approximately two-thirds of the total market value of all
domestic common stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 4.50%
maximum sales load and are subject to an annual 0.25% service organization fee.
The load performance for the Series A shares has been restated to reflect the
impact of the current sales charge. Series A performance prior to January 10,
1995 does not reflect the service organization fees. If service organization
fees had been reflected, performance would be reduced. Series B shares have
a 5.00% maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/99
- -----------------------------------------
PROTECTIVE LIFE CORPORATION 5.7%
- -----------------------------------------
AMBAC FINANCIAL GROUP, INC. 3.5%
- -----------------------------------------
MGIC INVESTMENT CORPORATION 3.4%
- -----------------------------------------
FISERV, INC. 2.8%
- -----------------------------------------
FAMILY DOLLAR STORES 2.8%
- -----------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/99
- -----------------------------------------
$455,830,821
- -----------------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
- -------------------------------------------------------------------------------
EMERGING GROWTH FUND
- -------------------------------------------------------------------------------
Firstar Emerging Growth Fund seeks capital appreciation through investments in
small-sized companies with stock market capitalizations generally between $250
million and $2 billion. The Fund's weighted average market capitalization is
currently $1.2 billion, just slightly above the S&P SmallCap 600 Index weighted
average of $1.0 billion. For the fiscal year ended October 31, 1999, the Fund
performed poorly against the S&P SmallCap 600 Index and the average small
capitalization money manager, following a year of significant relative
outperformance in fiscal 1998. Investors favored high price-to-earnings stocks
(due to minimal or zero earnings in the denominator) against consistent growth
companies that fit our growth-at-a-reasonable-price (GARP) style. With this
market environment, the Fund returned -2.6% (Institutional shares) in fiscal
1999, trailing the S&P SmallCap 600 Index at +12.0% and the Russell 2000 Index
at +14.9%. Large stocks continued to dominate the top-returning categories as
the S&P 500 Index rose 25.7% during fiscal 1999.
Fiscal and calendar 1999 returns were driven primarily by technology stocks
across all market capitalizations. Basically, a heavy concentration in
technology stocks was the distinguishing characteristic between winning
portfolios and losing portfolios. In calendar 1999, the technology sector of the
S&P SmallCap 600 Index rose 25.0% and added 4.4% to the Index's total return.
The cumulative effort of all other sectors in the Index subtracted 3.3% from the
Index's total return. In fact, 13 of the S&P SmallCap's top 15 performing stocks
were technology companies, with some rising over 200%. Despite an overall
technology weight above the Index, the Fund did not benefit from the technology
frenzy due to bigger industry weights in data processing stocks which performed
poorly all year. In essence, the Fund's top technology performers in fiscal 1998
became the bottom performers of fiscal 1999. Specifically, Acxiom, National Data
and Mastech fell over 30% as their relative earnings momentum slowed within the
technology space. Today, the Fund is overweighted in technology stocks and
maintains positions in fundamentally improving industries that were not owned in
the Fund in fiscal 1998 or early in fiscal 1999. Examples of these industries
are semiconductors, e-commerce software, electrical components and
telecommunications equipment. Since mid-year, these positions have helped the
Fund gain moderate ground against the Index.
In addition to the technology sector, the Fund was overweighted in financial
stocks and consumer cyclical companies. Finance companies, with rising interest
rates this year, have lagged the returns of most sectors. Our finance positions
did outperform the Index (-5% against -8%); however, the overweight in a
declining sector hurt the Fund's overall positioning. The Fund is now
underweighted in finance companies based on our belief that consolidation of
small-sized banks will slow next year and the possibility of further interest
rate hikes. In consumer cyclicals, specifically retail stocks, the Fund fell -
14% against -12% for the Index. We continue to hold a larger retail position
than the Index.
The weighted average forward price-to-earnings ratio of the Fund is 21x, about
10% higher than that of the S&P SmallCap 600 Index; however, the expected
earnings growth of the 80 companies held within the Fund is 28%, more than
double the Index's estimated growth of 12%. We believe the continued focus on
consistent, quality companies with accelerating growth provides a solid platform
for outperformance in fiscal 2000.
Thank you for your support.
PORTFOLIO MANAGER PROFILE
- -------------------------------------------------------------------------------
(PHOTO) (PHOTO)
TODD KRIEG, CFA, JD MATTHEW D'ATTILIO, CFA
TODD KRIEG, CFA, JD, Senior Vice President and Senior Portfolio Manager of
Firstar Investment Research & Management Company, LLC (FIRMCO) and MATTHEW
D'ATTILIO, CFA, Senior Vice President and Senior Portfolio Manager have co-
managed the Fund since its inception August 15, 1997. Todd has been with Firstar
since 1992 and has seven years of investment management experience. He received
his BA from Williams College in 1983 and a JD from Georgetown University in
1989. Matt has been with Firstar since 1993 and has six years of investment
management experience. He received his BA from Bowdoin College in 1993. Todd and
Matt are both Chartered Financial Analysts.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR EMERGING
GROWTH FUND - S&P WILSHIRE
INSTITUTIONAL SMALLCAP 600 NEXT 1750
--------------- -------------- ---------------
8/15/97 10,000 10,000 10,000
10/97 10,310 10,558 10,564
10/98 9,655 9,390 9,568
10/99 9,407 10,521 11,377
This chart assumes an initial investment of $10,000 made on 8/15/97 (inception).
Performance reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced. Performance is shown for Institutional shares, which
have lower expenses than Series A or Series B shares. If those fees and expenses
were reflected in the chart above, total return would have been reduced. Returns
shown include the reinvestment of all dividends and other distributions. Past
performance is not predictive of future performance. Investment return and
principal value will fluctuate, so that your shares, when redeemed, may be worth
more or less than their original cost.
- -------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1999
- -------------------------------------------------------------------------------
1 Year Since Inception
- -------------------------------------------------------------------------------
FIRSTAR EMERGING GROWTH FUND - INSTITUTIONAL (2.6) (2.7) (8/15/97)
FIRSTAR EMERGING GROWTH FUND - A - NO LOAD (2.7) (2.9) (8/15/97)
FIRSTAR EMERGING GROWTH FUND - A - LOAD<F2> (7.1) (4.9) (8/15/97)
FIRSTAR EMERGING GROWTH FUND - B - NO LOAD - (3.3) (3/1/99)<F1>
FIRSTAR EMERGING GROWTH FUND - B - LOAD<F3> - (8.2) (3/1/99)<F1>
S&P SMALLCAP 600 INDEX<F4> 12.0 2.3 (8/15/97)
WILSHIRE NEXT 1750 INDEX<F5> 18.9 6.0 (8/15/97)
- -------------------------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1, 1999 to
October 31, 1999 is not annualized.
<F2> Reflects maximum sales charge of 4.50%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The S&P SmallCap 600 Index is a capitalization weighted index that
measures the performance of selected U.S. stocks with small market
capitalizations.
<F5> The Wilshire Next 1750 Index is an unmanaged index which shows the
next largest 1,750 companies after the Top 750 of the Wilshire 5000
Stock Index.
An investment cannot be made directly in an index.
Series A shares have a 4.50% maximum sales load and are subject to an annual
0.25% service organization fee. Series B shares have a 5.00% maximum deferred
sales charge and are subject to an annual 0.25% service organization fee and a
0.75% 12b-1 fee. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/99
- --------------------------------------
SYKES ENTERPRISES,INC. 4.2%
- --------------------------------------
THE BISYS GROUP, INC. 4.2%
- --------------------------------------
RADIAN GROUP, INC. 3.3%
- --------------------------------------
ACXIOM CORPORATION 3.3%
- --------------------------------------
CDW COMPUTER CENTERS, INC. 3.0%
- --------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/99
- --------------------------------------
$149,315,954
- --------------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
- -------------------------------------------------------------------------------
MICROCAP FUND
- -------------------------------------------------------------------------------
From November 1, 1998 to October 31, 1999, Firstar MicroCap's total return was
77.1% (Institutional shares) versus 14.9% for its benchmark, the Russell 2000,
with the Fund ranking in the 16th percentile of 279 small-cap growth funds
according to Lipper Analytical Services (for the period ended October 31, 1999).
As we mentioned in our mid-year report, the Fund earned Standard & Poor's Select
Fund status for the small-cap growth fund category in April. This designation
was awarded to only 21 of 409 small-cap growth funds.<F1>
At the beginning of the reporting period, we were just beginning to rebound from
the second worst bear market in history for small-cap stocks. The downturn
brought on by the Asian economic crisis depressed microcap stocks to levels not
seen in decades. The first six months of the fiscal year were ideal for a
sustained move in equities; however, concerns shifted to an overheating economy,
rising inflation and interest rates, which provided an overhang on
the overall market. Even these concerns couldn't derail the strength in
technology stocks as earnings targets were exceeded based on strong
fundamentals. The Y2K spending lockdown issue which affected tech stocks earlier
this year is now just an afterthought as corporations spend furiously on
internet-enabling technologies.
Given the depressed prices of virtually all microcap stocks last October, we
positioned Firstar MicroCap Fund to take advantage of a rebound in several
industries where we felt the opportunities were greatest - namely wireless
telecom, internet infrastructure and technology. Specific names in each industry
which were added to the portfolio include: Alpha Industries for wireless,
Adelphia Business Solutions and Vignette for internet infrastructure, and
Galileo Technologies and Ancor Communications for technology. See page 65 for a
complete listing of portfolio holdings.
In general, our overweighted position in technology and energy coupled with our
underweighted positions in healthcare and financials helped drive performance.
Eleven stocks in the portfolio added 2% or more of absolute performance to the
Fund, indicating broad strength in our selections. Triple-digit returns were
earned by Alpha Industries and Transaction Network services, both of which
contributed over 5% each to the Fund's overall performance. Ancor Communications
also added over 5% of return to the Fund's performance after appreciating over
1000%. Our strong performance can also be attributed to the work of our equity
analysts. Specifically, Earl DeLaet, CFA, made significant contributions to the
Fund in covering the software, information technology services and internet
infrastructure related stocks. On November 12, 1999, Earl was named co-manager
of Firstar MicroCap Fund.
We remain positive on the outlook for the stock market for the remainder of the
year and into 2000. Although the technology sector has been red-hot and
valuations seem stretched, we expect technology to perform well relative to the
overall market as we believe we are in the early innings of a technological
revolution. The rapid shift to the internet as a business platform is increasing
productivity enormously, keeping inflation in check. Moreover, seasonal factors
in early 2000 relating to employee bonus payments and tax refunds should provide
for a good liquidity environment. The Fed's future decisions regarding the
direction of interest rates remain the primary wild card.
The Fund will close to new investors effective January 14, 2000. Current
shareholders of Firstar MicroCap Fund will be permitted to make additional
contributions to their existing accounts or open new accounts for which an
existing shareholder is full or partial owner. After a year of strong
appreciation and cash inflows, it is important we control new investments in
order to maintain the integrity and investment style of the Fund. We continue to
believe microcap stocks represent an excellent long-term opportunity.
We appreciate your continued support of Firstar MicroCap Fund.
<F1> Based on a six-month moving average of three years of absolute and
volatility-adjusted performance data relative to 409 small capitalization
growth funds.
PORTFOLIO MANAGER PROFILE
- -------------------------------------------------------------------------------
(PHOTO) (PHOTO)
JOSEPH A. FROHNA, EARL DeLAET, CFA
CFA, CPA
JOE FROHNA, CFA, CPA, and EARL DELAET, CFA, co-manage the Fund - Mr. Frohna
since September 9, 1997 and Mr. DeLaet since November 12, 1999. Mr. Frohna is a
Senior Vice President and Senior Portfolio Manager with FIRMCOand has been with
Firstar since 1995. He has six years of investment management experience. Mr
DeLaet is an Investment Officer and Portfolio Manager with FIRMCO. He has four
years of investment management experience and has been with Firstar since 1997.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR
MICROCAP FUND -
INSTITUTIONAL RUSSELL 2000
--------------- ---------------
8/1/95 10,000 10,000
10/95 16,393 11,709
10/96 17,188 11,567
10/97 22,365 14,960
10/98 17,555 13,189
10/99 31,083 15,150
This chart assumes an initial investment of $10,000 made on 8/1/95 (inception).
Performance reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced. Performance is shown for Institutional shares, which
have lower expenses than Series A or Series B shares. If those fees and expenses
were reflected in the chart above, total return would have been reduced. Returns
shown include the reinvestment of all dividends and other distributions. Past
performance is not predictive of future performance. Investment return and
principal value will fluctuate, so that your shares, when redeemed, may be worth
more or less than their original cost.
- -------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1999
- -------------------------------------------------------------------------------
1 Year 3 Years Since Inception
- -------------------------------------------------------------------------------
FIRSTAR MICROCAP FUND -
INSTITUTIONAL 77.1 21.8 30.6 (8/1/95)
FIRSTAR MICROCAP FUND -
A - NO LOAD 76.5 21.5 30.2 (8/1/95)
FIRSTAR MICROCAP FUND -
A - LOAD<F3> 68.6 19.7 28.8 (8/1/95)
FIRSTAR MICROCAP FUND -
B - NO LOAD - - 57.9 (3/1/99)<F1>
FIRSTAR MICROCAP FUND -
B - LOAD<F4> - - 52.9 (3/1/99)<F1>
RUSSELL 2000 INDEX<F2> 14.9 9.4 10.3 (8/1/95)
- -------------------------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> The Russell 2000, an unmanaged index, consists of the smallest 2,000
companies in a group of 3,000 U.S. companies in the Russell 3000
Index, as ranked by total market capitalization.
<F2> Reflects maximum sales charge of 4.50%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> Series B performance for the period March 1, 1999 to
October 31, 1999 is not annualized.
An investment cannot be made directly in an index.
The Fund participates in the Initial Public Offering ("IPO") market, and a
portion of the Fund's returns are attributable to its investments in IPOs, which
have a magnified impact due to the Fund's relatively small asset base. There is
no guarantee that, as the Fund's assets grow, it will continue to experience
substantially similar performance by investing in IPOs.
Series A shares have a 4.50% maximum sales load and are subject to an annual
0.25% service organization fee. Series B shares have a 5.00% maximum deferred
sales charge and are subject to an annual 0.25% service organization fee and a
0.75% 12b-1 fee. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/99
- -----------------------------------------
GALILEO TECHNOLOGY, LTD. 4.3%
- -----------------------------------------
ANCOR COMMUNICATIONS, INC. 3.9%
- -----------------------------------------
THREE FIVE SYSTEMS, INC. 3.1%
- -----------------------------------------
PARADYNE NETWORKS, INC. 3.1%
- -----------------------------------------
TRANSACTION NETWORK SERVICES, INC. 2.7%
- -----------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/99
- -----------------------------------------
$173,026,460
- -----------------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
- -------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND
- -------------------------------------------------------------------------------
For the one-year period ended October 31, 1999, the Firstar International Equity
Fund returned 24.7% (Institutional shares). This compares with 23.0% return for
the Morgan Stanley Capital International - Europe, Australia, New Zealand and
the Far East (MSCI EAFE) Index over the same period. Thus far in Calendar 1999,
the Firstar International Equity Fund has a return of 21.74%. This compares with
12.85% for the MSCI EAFE Index over the same period.
The principal factors influencing performance during the last 12 months include
the recovery in Asia and the recovery in commodity-sensitive issues. Improving
conditions in Japan's economic and corporate landscape have proven beneficial to
the portfolio's performance given the significant increase in our Japanese
exposure during the last 12 months. Restructuring in the corporate sector, most
notably in banking, has had the most meaningful positive impact on the Fund's
performance. Elsewhere in Asia, equities responded favorably as risk premiums
declined and earnings began to recover from exceedingly depressed levels. Our
underweight position in Europe proved beneficial to performance as the region
underperformed other regional indices during the past year.
Our strategy continues to focus on investment opportunities at the company level
where stock prices are trading below their intrinsic value. The ideas generated
by our analysis have led us to gradually increase our exposure in Japan and to
maintain a meaningful overweight position elsewhere in Asia. Our European
exposure should remain relatively modest given the more appealing opportunities
elsewhere in the world. Our domestic-oriented focus in Japan contributed
favorably to performance, particularly as merger and acquisition (M&A) activity
entered the banking sector. Several of the Fund's Japanese financial stocks have
directly or indirectly been involved in this M&A activity. Dai-Ichi Kangyo
Banks, Daiwa Securities, Nippon Fire & Marine Insurance, Sumitomo Trust and Toyo
Trust are all actively participating in this process. Performance was also
favorably influenced by positions in Hitachi, NEC and NTT Docomo, to name a few.
Our previously established positions throughout the smaller Asian markets
contributed to the Fund's gains as well. Given the magnitude of the earnings
upgrades and our long-term earnings forecast for these stocks, we have remained
committed to our overweight position in other Asian equities.
On a sectoral basis, we have benefited considerably from our meaningful exposure
to telecommunication stocks globally. Many of these companies provide the long-
term infrastructure for cyberspace while generating strong near-term earnings
and cash flow growth. We have taken profits on positions where stock prices have
reached our targets, but we continue to have meaningful exposure. The
portfolio's cyclical exposure benefited performance during the first half of the
year, but recent performance has been less robust. We remain encouraged by the
prospects for these holdings given the changing supply-demand characteristics of
underlying industries and the improving demand outlook for Asia and Europe.
As the likelihood of further declines in interest rates diminishes, equity
markets should transition from being interest-rate driven to earnings driven. We
are encouraged by the prospect of such a transition given the attractive
combination of valuations and earnings growth prospects that exist among the
Fund's portfolio holdings. Continuation of the recovery in Asia, a bottoming in
commodity prices, and moderate economic growth conditions in the United States
and Europe could provide a favorable backdrop supporting continued upward
earnings revisions in many of our holdings. Risk considerations include the
direction of US interest rates, any disruption in the pace of Japan's recovery
and political uncertainties in various countries worldwide.
We appreciate your interest in Firstar International Equity Fund.
JAMES E. CHANEY JOHN HOCK, CFA
PORTFOLIO MANAGER PROFILE
- -------------------------------------------------------------------------------
(PHOTO) (PHOTO)
JAMES E. CHANEY JOHN HOCK, CFA
JAMES E. CHANEY, Chief Investment Officer of Hansberger Global Investors, Inc.
(HGI), the Fund's sub-adviser and JOHN HOCK, CFA, Research Analyst and Assistant
Portfolio Manager of HGI have co-managed the Fund since September 2, 1997 (when
the sub-advisory agreement with HGI went into effect). Jim has been with HGI
since 1996 and has 15 years of investment management experience. He received his
BS from the University of Massachusetts - Amherst in 1979, his MS from
Northeastern University in 1983 and his MBA from Columbia University in 1987.
John has been with HGI since 1995 and has eight years of investment management
experience. He received his BS from Cornell University in 1990 and his MBA from
New York University in 1995. John is a Chartered Financial Analyst. The
portfolio management team also includes John Fenley and Victoria Gretsky.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR
INTERNATIONAL
EQUITY FUND -
INSTITUTIONAL EAFE Index<F4>
---------------- ---------------
4/28/94 10,000 10,000
10/94 9,995 10,429
10/95 9,620 10,390
10/96 10,410 11,478
10/97 9,879 12,009
10/98 8,303 13,168
10/99 10,356 16,201
This chart assumes an initial investment of $10,000 made on 4/28/94 (inception).
Performance reflects fee waivers in effect. In the absence
of fee waivers, total return would be reduced. Performance is shown for
Institutional shares, which have lower expenses than Series A or Series B
shares. If those fees and expenses were reflected in the chart above, total
return would have been reduced. Returns shown include the reinvestment of all
dividends and other distributions. Past performance is not predictive of future
performance. Investment return and principal value will fluctuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
- -------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1999
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1 Year 3 Years 5 Years Since Inception
- -------------------------------------------------------------------------------
FIRSTAR INTERNATIONAL
EQUITY FUND - INSTITUTIONAL 24.7 (0.2) 0.7 0.6 (4/28/94)
FIRSTAR INTERNATIONAL
EQUITY FUND - A - NO LOAD 24.5 (0.4) 0.5 0.4 (4/28/94)
FIRSTAR INTERNATIONAL
EQUITY FUND - A - LOAD<F2> 18.8 (1.9) (0.4) (0.4) (4/28/94)
FIRSTAR INTERNATIONAL
EQUITY FUND - B - NO LOAD - - - 24.9 (3/1/99)<F1>
FIRSTAR INTERNATIONAL
EQUITY FUND - B - LOAD<F3> - - - 19.9 (3/1/99)<F1>
EAFEINDEX<F4> 23.0 12.2 9.2 9.1 (4/28/94)
- -------------------------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1, 1999 to
October 31, 1999 is not annualized.
<F2> Reflects maximum sales charge of 4.50%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The Morgan Stanley Capital International Europe, Australia and Far East
Index ("MSCI/EAFE") is an unmanaged index composed
of 20 European and Pacific Basin countries. The MSCI/EAFEIndex is the most
recognized international index and is weighted by market capitalization.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 4.50%
maximum sales load and are subject to an annual 0.25% service organization fee.
The load performance for the Series A shares has been restated to reflect the
impact of the current sales charge. Series A performance prior to January 10,
1995, does not reflect the service organization fees. If service organization
fees had been reflected, performance would be reduced. Series B shares have
a 5.00% maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
TOP 5 COUNTRIES 10/31/99
- ------------------------------------
JAPAN 25.3%
- ------------------------------------
GREAT BRITAIN 8.7%
- ------------------------------------
HONG KONG 4.3%
- ------------------------------------
FRANCE 3.9%
- ------------------------------------
SWEDEN 3.8%
- ------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/99
- ------------------------------------
$60,885,204
- ------------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF ASSETS AND LIABILITIES
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
OCTOBER 31, 1999
<TABLE>
<CAPTION>
BALANCED BALANCED GROWTH
INCOME GROWTH AND INCOME
FUND FUND FUND
------ ----- -----
<S> <C> <C> <C>
ASSETS:
Investments, at value (cost $60,651, $200,803,
$514,167, $375,243,
$259,655, $354,665, $143,609,
$137,468, $59,380, respectively) $65,480 $237,927 $716,228
Cash _ 511 _
Income receivable 421 1,538 1,090
Capital shares sold 472 106 1,710
Receivable for securities sold 639 1,181 13,429
Other assets 53 29 32
------- -------- --------
Total Assets 67,065 241,292 732,489
------- -------- --------
LIABILITIES:
Payable for securities purchased 2,586 2,065 3,968
Capital shares redeemed 19 3,798 929
Payable to affiliates 50 224 628
Accrued expenses and other liabilities 24 31 68
------- -------- --------
Total Liabilities 2,679 6,118 5,593
------- -------- --------
NET ASSETS $64,386 $235,174 $726,896
======= ======== ========
NET ASSETS CONSIST OF:
Capital stock $58,292 $186,157 $463,446
Undistributed net investment income (loss) 166 368 832
Undistributed accumulated net realized gains
(losses) on investments 1,099 11,525 60,557
Unrealized net appreciation (depreciation) on:
Investments 4,829 37,124 202,061
Futures contracts _ _ _
Foreign currency _ _ _
------- -------- --------
Total Net Assets $64,386 $235,174 $726,896
======= ======== ========
SERIES A:
Net assets $13,087 $53,807 $194,089
Shares authorized ($.0001 par value) 100,000 500,000 500,000
Shares issued and outstanding 1,197 1,790 4,214
Net asset value and redemption price per share <F1> $10.94 $30.06 $46.06
======= ======== ========
Maximum offering price per share <F1> $11.46 $31.48 $48.23
======= ======== ========
SERIES B:
Net assets $1,571 $630 $1,550
Shares authorized ($.0001 par value) 100,000 500,000 500,000
Shares issued and outstanding 143 21 34
Net asset value, redemption price and offering
price per share <F1> $10.96 $30.15 $46.03
======= ======== ========
SERIES INSTITUTIONAL:
Net assets $49,728 $180,737 $531,257
Shares authorized ($.0001 par value) 100,000 500,000 500,000
Shares issued and outstanding 4,539 6,003 11,519
Net asset value, redemption price and offering
price per share <F1> $10.96 $30.11 $46.12
======= ======== ========
<F1> Amounts may not recalculate due to rounding.
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF ASSETS AND LIABILITIES
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
OCTOBER 31, 1999
<TABLE>
EQUITY SPECIAL EMERGING INTERNATIONAL
INDEX GROWTH GROWTH GROWTH MICROCAP EQUITY
FUND FUND FUND FUND FUND FUND
----- ----- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments, at value (cost $60,651, $200,803,
$514,167, $375,243,
$259,655, $354,665, $143,609,
$137,468, $59,380, respectively) $718,319 $353,476 $467,265 $154,222 $171,769 $60,398
Cash 22 - - - - -
Income receivable 688 173 227 102 42 335
Capital shares sold 1,774 2,170 1,078 310 554 636
Receivable for securities sold 631 218 829 1,702 6,724 120
Other assets 94 27 23 34 25 11
-------- ------- -------- -------- -------- --------
Total Assets 721,528 356,064 469,422 156,370 179,114 61,500
-------- ------- -------- -------- -------- --------
LIABILITIES:
Payable for securities purchased - 685 9,519 6,626 5,526 -
Capital shares redeemed 6,131 241 3,574 240 256 146
Payable to affiliates 324 307 455 148 266 88
Accrued expenses and other liabilities 52 39 43 40 40 381
-------- ------- -------- -------- -------- --------
Total Liabilities 6,507 1,272 13,591 7,054 6,088 615
-------- ------- -------- -------- -------- --------
NET ASSETS $715,021 $354,792 $455,831 $149,316 $173,026 $60,885
======== ======== ======== ======== ======== =======
NET ASSETS CONSIST OF:
Capital stock $355,236 $243,386 $337,481 $157,855 $92,912 $68,865
Undistributed net investment income (loss) 570 (4) (4) (2) (4) 176
Undistributed accumulated net realized gains
(losses) on investments 15,035 17,589 5,754 (19,150) 45,817 (9,172)
Unrealized net appreciation (depreciation) on:
Investments 343,076 93,821 112,600 10,613 34,301 1,018
Futures contracts 1,104 - - - - -
Foreign currency - - - - - (2)
-------- ------- -------- -------- -------- --------
Total Net Assets $715,021 $354,792 $455,831 $149,316 $173,026 $60,885
======== ======== ======== ======== ======== =======
SERIES A:
Net assets $142,247 $47,238 $95,758 $9,957 $21,988 $6,418
Shares authorized ($.0001 par value) 500,000 500,000 500,000 100,000 50,000 500,000
Shares issued and outstanding 1,549 1,245 2,533 1,072 1,009 346
Net asset value and redemption price per
share <F1> $91.83 $37.96 $37.80 $9.29 $21.80 $18.53
======== ======== ======== ======== ======== =======
Maximum offering price per share <F1> $96.16 $39.75 $39.58 $9.73 $22.83 $19.40
======== ======== ======== ======== ======== =======
SERIES B:
Net assets $4,613 $722 $126 $80 $140 $44
Shares authorized ($.0001 par value) 500,000 500,000 500,000 100,000 50,000 500,000
Shares issued and outstanding 50 19 3 9 6 2
Net asset value, redemption price and offering
price per share <F1> $91.72 $37.78 $37.63 $9.25 $21.69 $18.37
======== ======== ======== ======== ======== =======
SERIES INSTITUTIONAL:
Net assets $568,161 $306,832 $359,947 $139,279 $150,898 $54,423
Shares authorized ($.0001 par value) 500,000 500,000 500,000 100,000 50,000 500,000
Shares issued and outstanding 6,179 7,985 9,394 14,940 6,840 2,916
Net asset value, redemption price and offering
price per share <F1> $91.95 $38.42 $38.32 $9.32 $22.06 $18.66
======== ======== ======== ======== ======== =======
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
BALANCED INCOME FUND BALANCED GROWTH FUND GROWTH AND INCOME FUND
-------------------- --------------------- ----------------------
Year Dec. 1, 1997<F1> Year Year Year Year
ended through ended ended ended ended
Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
1999 1998 1999 1998 1999 1998
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $1,404 $962 $4,649 $4,908 $6,818 $6,241
Net realized gain (loss) on:
Investments (452) (227) 12,374 7,539 61,424 48,714
Foreign currency - - - - - -
Net change in unrealized appreciation
(depreciation) on:
Investments 2,065 2,764 (3,281) 5,444 12,321 37,014
Foreign currency - - - - - -
------ ------- ------- ------- ------- -------
Net increase (decrease) in net assets
resulting from operations 3,017 3,499 13,742 17,891 80,563 91,969
------ ------- ------- ------- ------- -------
CAPITAL SHARE TRANSACTIONS:
Shares sold 32,182 47,732 65,070 82,729 179,414 216,717
Shares issued to owners in
reinvestment of dividends 1,347 194 12,405 21,725 49,818 20,917
Shares redeemed (13,627) (5,929) (91,179) (60,901) (191,334) (135,217)
------- ------- ------- ------- -------- --------
Net increase (decrease) in net assets
as a result of capital
share transactions 19,902 41,997 (13,704) 43,553 37,898 102,417
------ ------- ------- ------- ------- -------
DISTRIBUTIONS TO SERIES A SHAREHOLDERS:
From net investment income (312) (128) (953) (1,052) (1,524) (1,343)
From net realized gains (449) - (1,908) (3,620) (13,914) (4,638)
------ ------- ------- ------- ------- -------
(761) (128) (2,861) (4,672) (15,438) (5,981)
------ ------- ------- ------- ------- -------
DISTRIBUTIONS TO SERIES B SHAREHOLDERS:
From net investment income (9) - (3) - (1) -
From net realized gains - - - - - -
------ ------- ------- ------- ------- -------
(9) - (3) - (1) -
------ ------- ------- ------- ------- -------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREHOLDERS:
From net investment income (1,044) (718) (3,692) (3,864) (5,308) (4,463)
From net realized gains (1,369) - (6,088) (13,536) (35,752) (13,098)
------ ------- ------- ------- ------- -------
(2,413) (718) (9,780) (17,400) (41,060) (17,561)
------ ------- ------- ------- ------- -------
TOTAL INCREASE (DECREASE) IN NET ASSETS 19,736 44,650 (12,606) 39,372 61,962 170,844
NET ASSETS:
Beginning of year 44,650 - 247,780 208,408 664,934 494,090
------ ------- ------- ------- ------- -------
End of year (including undistributed
net investment income (loss) of
$166, $122, $368, $373, $832, $910,
$570, $621, $(4), $234, $(4), $(2),
$(2) and $(71), respectively) $64,386 $44,650 $235,174 $247,780 $726,896 $664,934
======= ======= ======== ======== ======= =======
</TABLE>
<F1> Commencement of operations.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
EQUITY INDEX FUND GROWTH FUND SPECIAL GROWTH FUND EMERGING GROWTH FUND
----------------- ---------------- -------------------- ---------------------
Year Year Year Year Years Year Year Year
ended ended ended ended ended ended ended ended
Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
1999 1998 1999 1998 1999 1998 1999 1998
----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $7,373 $6,945 $(302) $356 $(103) $(2,626) $(157) $303
Net realized gain (loss) on:
Investments 17,654 1,439 18,890 26,680 38,420 3,773 (12,915) (6,752)
Foreign currency - - - - - - - -
Net change in unrealized appreciation
(depreciation) on:
Investments 109,742 81,804 25,991 10,510 (27,055) (33,543) 8,864 875
Foreign currency _ _ _ _ _ _ _ _
------- ------ ------ ------ ------- ------- ------ ------
Net increase (decrease) in net assets
resulting from operations 134,769 90,188 44,579 37,546 11,262 (32,396) (4,208) (5,574)
------- ------ ------ ------ ------- ------- ------ ------
CAPITAL SHARE TRANSACTIONS:
Shares sold 341,167 184,708 218,241 68,655 255,663 149,421 140,767 40,444
Shares issued to owners in
reinvestment of dividends 9,845 12,729 22,498 23,938 4,422 64,516 71 352
Shares redeemed (322,755) (103,374) (138,508) (70,468) (411,662) (225,403) (60,500) (14,898)
------- ------ ------ ------ ------- ------- ------ ------
Net increase (decrease) in net assets
as a result of capital
share transactions 28,257 94,063 102,231 22,125 (151,577) (11,466) 80,338 25,898
------- ------ ------ ------ ------- ------- ------ ------
DISTRIBUTIONS TO SERIES A SHAREHOLDERS:
From net investment income (1,277) (1,155) (28) (16) _ _ (15) (12)
From net realized gains (710) (1,399) (4,421) (3,671) (1,086) (14,736) _ (33)
------- ------ ------ ------ ------- ------- ------ ------
(1,987) (2,554) (4,449) (3,687) (1,086) (14,736) (15) (45)
------- ------ ------ ------ ------- ------- ------ ------
DISTRIBUTIONS TO SERIES B SHAREHOLDERS:
From net investment income (8) - - - - - - -
From net realized gains - - - - - - - -
------- ------ ------ ------ ------- ------- ------ ------
(8) - - - - - - -
------- ------ ------ ------ ------- ------- ------ ------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREHOLDERS:
From net investment income (6,138) (5,682) (237) (185) - - (83) (118)
From net realized gains (2,753) (5,759) (23,343) (26,481) (3,772) (56,822) - (276)
------- ------ ------ ------ ------- ------- ------ ------
(8,891) (11,441) (23,580) (26,666) (3,772) (56,822) (83) (394)
------- ------ ------ ------ ------- ------- ------ ------
TOTAL INCREASE (DECREASE) IN NET ASSETS 152,140 170,256 118,781 29,318 (145,173) (115,420) 76,032 19,885
NET ASSETS:
Beginning of year 562,881 392,625 236,011 206,693 601,004 716,424 73,284 53,399
------- ------ ------ ------ ------- ------- ------ ------
End of year (including undistributed
net investment income (loss) of
$166, $122, $368, $373, $832, $910,
$570, $621, $(4), $234, $(4), $(2),
$(2) and $(71), respectively) $715,021 $562,881 $354,792 $236,011 $455,831 $601,004 $149,316 $73,284
======== ======= ======= ======== ======= ======= ======== ======
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
MICROCAP FUND INTERNATIONAL EQUITY FUND
---------------------------- --------------------------
Year Year Year Year
ended ended ended ended
Oct. 31, 1999 Oct. 31, 1998 Oct. 31, 1999 Oct. 31, 1998
------------- ------------- ------------ ------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $(1,572) $(1,595) $387 $855
Net realized gain (loss) on:
Investments 47,964 (275) (3,981) (5,124)
Foreign currency - - (189) (23)
Net change in unrealized appreciation
(depreciation) on:
Investments 29,718 (21,884) 14,598 (7,356)
Foreign currency - - (8) 5
------- -------- ------- --------
Net increase (decrease) in net assets resulting
from operations 76,110 (23,754) 10,807 (11,643)
------- -------- ------- --------
CAPITAL SHARE TRANSACTIONS:
Shares sold 53,050 3,237 20,267 16,655
Shares issued to owners in
reinvestment of dividends 264 9,448 691 1,247
Shares redeemed (41,236) (13,035) (21,147) (17,246)
------- -------- ------- --------
Net increase (decrease) in net assets as a
result of capital share transactions 12,078 (350) (189) 656
------- -------- ------- --------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income _ _ (122) (31)
From net realized gains (44) (1,599) _ (135)
------- -------- ------- --------
(44) (1,599) (122) (166)
------- -------- ------- --------
DISTRIBUTIONS TO SERIES B SHAREOWNERS:
From net investment income - - - -
From net realized gains - - - -
------- -------- ------- --------
- - - -
------- -------- ------- --------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income - - (767) (277)
From net realized gains (233) (9,815) - (1,122)
------- -------- ------- --------
(233) (9,815) (767) (1,399)
------- -------- ------- --------
TOTAL INCREASE (DECREASE) IN NET ASSETS 87,911 (35,518) 9,729 (12,552)
NET ASSETS:
Beginning of year 85,115 120,633 51,156 63,708
------- -------- ------- --------
End of year (including undistributed net
investment income (loss) of $(4),
$(3), $176 and $866,
respectively) $173,026 $85,115 $60,885 $51,156
======== ======= ======= ========
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
(AMOUNTS IN THOUSANDS)
YEAR ENDED OCTOBER 31, 1999
BALANCED BALANCED GROWTH EQUITY
INCOME GROWTH AND INCOME INDEX GROWTH
FUND FUND FUND FUND FUND
----- ----- --------- ------ ------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividend income:
Domestic $401 $670 $11,654 $8,186 $1,205
Foreign - - - - -
Interest income:
Domestic 1,512 6,551 2,546 1,867 1,590
Foreign - - - - -
Other income - 3 - 26 -
------ ------ ------- ------- -------
1,913 7,224 14,200 10,079 2,795
------ ------ ------- ------- -------
EXPENSES:
Investment advisory fees 380 1,953 5,587 1,643 2,382
Administration fees 54 280 801 707 341
Transfer agent fees and expenses 28 66 154 98 50
Fund accounting fees 39 93 91 98 63
Service organization fees - Series A 31 150 509 333 116
Service organization fees - Series B 1 1 2 4 1
12b-1 fees - Series B 3 2 5 11 2
Custody fees 14 91 110 101 53
Federal and state registration fees 31 36 44 49 44
Professional fees 40 42 39 39 42
Reports to shareholders 23 36 109 60 24
Amortization of organization costs 9 _ _ _ _
Directors' fees and expenses 7 7 7 8 7
Other 2 6 17 22 6
------ ------ ------- ------- -------
Total expenses before waiver 662 2,763 7,475 3,173 3,131
Less: Waiver of expenses (153) (188) (93) (467) (34)
------ ------ ------- ------- -------
Net Expenses 509 2,575 7,382 2,706 3,097
------ ------ ------- ------- -------
NET INVESTMENT INCOME (LOSS) 1,404 4,649 6,818 7,373 (302)
------ ------ ------- ------- -------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments (452) 12,374 61,424 17,654 18,890
Foreign currency - - - - -
Net change in unrealized appreciation
(depreciation) on:
Investments 2,065 (3,281) 12,321 109,742 25,991
Foreign currency - - - - -
------ ------ ------- ------- -------
Net gain on investments
and foreign currency 1,613 9,093 73,745 127,396 44,881
------ ------ ------- ------- -------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $3,017 $13,742 $80,563 $134,769 $44,579
======= ======= ======= ======== =======
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
(AMOUNTS IN THOUSANDS)
YEAR ENDED OCTOBER 31, 1999
SPECIAL EMERGING INTERNATIONAL
GROWTH GROWTH MICROCAP EQUITY
FUND FUND FUND FUND
------ ------ ------ ------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividend income:
Domestic $2,491 $421 $302 $-
Foreign(net of withholding taxes of $120) - - - 1,136
Interest income:
Domestic 2,914 804 456 -
Foreign - - - 59
Other income 49 - - -
------ ------ ------ ------
5,454 1,225 758 1,195
------ ------ ------ ------
EXPENSES:
Investment advisory fees 4,219 965 1,942 699
Administration fees 605 138 139 55
Transfer agent fees and expenses 173 48 41 34
Fund accounting fees 76 40 41 40
Service organization fees - Series A 303 31 44 16
Service organization fees - Series B 0 0 0 0
12b-1 fees- Series B 0 0 0 0
Custody fees 103 56 35 27
Federal and state registration fees 23 60 29 23
Professional fees 38 46 42 42
Reports to shareowners 102 18 13 8
Amortization of organization costs _ 4 5 3
Directors' fees and expenses 7 8 8 7
Other 17 3 5 3
------ ------ ------ ------
Total expenses before waiver 5,666 1,417 2,344 957
Less: Waiver of expenses (109) (35) (14) (149)
------ ------ ------ ------
Net Expenses 5,557 1,382 2,330 808
------ ------ ------ ------
NET INVESTMENT INCOME (LOSS) (103) (157) (1,572) 387
------ ------ ------ ------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments 38,420 (12,915) 47,964 (3,981)
Foreign currency - - - (189)
Net change in unrealized appreciation
(depreciation) on:
Investments (27,055) 8,864 29,718 14,598
Foreign currency - - - (8)
------- ------ ------ ------
Net gain (loss) on investments
and foreign currency 11,365 (4,051) 77,682 10,420
------ ------ ------ ------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $11,262 $(4,208) $76,110 $10,807
======= ======== ======= =======
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
This page intentionally left blank.
<PAGE>
(LOGO) FIRSTAR FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
INSTITUTIONAL EQUITY FUNDS
Income from Investment Operations
---------------------------------------------
Net Realized
and Unrealized
Net Gains or
Asset Value, Net (Losses) Total From
Beginning Investment on Investment
of Period Income (Loss) Securities Operations
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------
PER SHARE DATA
- ------------------------------------------------------------------------------------------
BALANCED INCOME
- ------------------------------------------------------------------------------------------
Oct. 31, 1998 $10.00 $0.30 $0.96 $1.26
<F10>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 11.01 0.31 0.38 0.69
- ------------------------------------------------------------------------------------------
BALANCED GROWTH
- ------------------------------------------------------------------------------------------
October 31, 1995<F9> 22.10 0.53 3.78 4.31
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 25.90 0.55 2.62 3.17
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 27.99 0.66 4.20 4.86
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 30.51 0.62 1.86 2.48
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 29.85 0.58 1.19 1.77
- ------------------------------------------------------------------------------------------
GROWTH AND INCOME
- ------------------------------------------------------------------------------------------
October 31, 1995<F9> 23.09 0.42 5.14 5.56
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 27.63 0.50 6.61 7.11
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 33.08 0.46 8.94 9.40
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 39.28 0.47 6.55 7.02
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 44.46 0.41 4.92 5.33
- ------------------------------------------------------------------------------------------
EQUITY INDEX
- ------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F9> 33.41 0.76 7.71 8.47
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 41.08 0.91 8.68 9.59
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 49.43 0.95 14.33 15.28
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 63.16 1.02 12.59 13.61
<F10>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 74.66 1.04 17.75 18.79
- ------------------------------------------------------------------------------------------
GROWTH
- ------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F9> 21.47 0.03 4.16 4.19
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 25.61 (0.01) 4.83 4.82
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 30.43 0.04 6.31 6.35
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 35.48 0.07 5.70 5.77
<F10>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 36.05 (0.02) 6.47 6.45
<F10>
- ------------------------------------------------------------------------------------------
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
INSTITUTIONAL EQUITY FUNDS
Less Distributions Supplemental Data and Ratios
------------------ -------------------------------------------
Net Ratio Ratio of Net
Dividends Distributions Assets of Net Investment
From Net From Net Asset End of Expenses Income (Loss) Portfolio
Investment Capital Total Value, End Total Period to Average to Average Turnover
Income Gains Distributions of Period Return (000s) Net Assets Net Assets Rate<F12>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA
- ----------------------------------------------------------------------------------------------------------------------------------
BALANCED INCOME
- ----------------------------------------------------------------------------------------------------------------------------------
Dec. 1, 19971 through
Oct. 31, 1998 $(0.25) $- $(0.25) $11.01 12.70% $34,036 0.75% 3.07% 58.33%
<F2> <F3><F4> <F3><F4> <F2>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.30) (0.44) (0.74) 10.96 6.34% 49,728 0.93% 2.84% 48.46%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
BALANCED GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F9> (0.51) - (0.51) 25.90 19.79% 104,552 0.75% 2.24% 61.87%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.53) (0.55) (1.08) 27.99 12.56% 129,415 0.75% 2.05% 63.91%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.66) (1.68) (2.34) 30.51 18.39% 164,382 0.75% 2.31% 69.90%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.64) (2.50) (3.14) 29.85 8.83% 188,123 0.75% 2.16% 56.44%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.56) (0.95) (1.51) 30.11 5.87% 180,737 0.93% 1.84% 69.42%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F9> (0.42) (0.60) (1.02) 27.63 25.00% 162,752 0.90% 1.70% 47.85%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.47) (1.19) (1.66) 33.08 26.90% 226,888 0.90% 1.67% 51.37%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.47) (2.73) (3.20) 39.28 30.83% 366,020 0.87% 1.34% 31.36%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.45) (1.39) (1.84) 44.46 18.35% 474,603 0.87% 1.11% 48.56%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.46) (3.21) (3.67) 46.12 12.04% 531,257 0.92% 0.99% 62.20%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
EQUITY INDEX
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F9> (0.74) (0.06) (0.80) 41.08 26.02% 138,106 0.46% 2.34% 4.61%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.89) (0.35) (1.24) 49.43 23.68% 212,072 0.41% 2.01% 7.48%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.94) (0.61) (1.55) 63.16 31.38% 315,759 0.38% 1.66% 9.81%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (1.00) (1.11) (2.11) 74.66 21.93% 452,752 0.33% 1.43% 2.91%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (1.03) (0.47) (1.50) 91.95 25.32% 568,161 0.36% 1.17% 13.95%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F9> (0.05) - (0.05) 25.61 19.55% 134,428 0.90% 0.13% 49.84%
<F8> <F8>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 - - - 30.43 18.82% 155,293 0.90% (0.04)% 56.75%
<F8> <F8>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 - (1.30) (1.30) 35.48 21.56% 181,650 0.89% 0.09% 62.09%
<F8> <F8>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.03) (5.17) (5.20) 36.05 18.89% 197,798 0.89% 0.20% 51.82%
<F8> <F8>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.04) (4.04) (4.08) 38.42 18.18% 306,832 0.94% (0.06)% 59.35%
<F8> <F8>
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2> Not annualized.
<F3> Annualized.
<F4> Without fees waived, ratios of net expenses to average net assets for the
fiscal year ended October 31, 1999, and the period ended October 31, 1998
would have been 1.23%, 1.38%, respectively; and ratio of net investment
income to average net assets for the the fiscal year ended October 31, 1999
and period October 31, 1998 would have been 2.54%, 2.44%, respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
1.00%, 0.99%, 1.00%, 1.03%, 1.06%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 1.77%, 1.92%, 2.05%,
1.77%, 1.93%, respectively.
<F6> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.93%, 0.94%, 0.94%, 0.98%, 1.01%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 0.98%, 1.04%, 1.27%,
1.59%, 1.59%, respectively.
<F7> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.43%, 0.44%, 0.45%, 0.48%, 0.53%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 1.10%, 1.32%, 1.59%,
1.94%, 2.27%, respectively.
<F8> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.95%, 0.96%, 0.96%, 0.98%, 1.02%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been (0.07)%, 0.13%, 0.01%,
(0.12)%, 0.01%, respectively.
<F9> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareholders exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of the
close of business on January 9, 1995, and the results thereof combined with
the results of operations and distributions for each applicable class for
the period January 10, 1995, through October 31, 1995.
<F10> Net investment income per share represents net investment income divided
by the average shares outstanding throughout the period.
<F11> Net investment income (loss) per share is calculated using ending balances
prior to consideration of adjustments for permanent book and tax
differences.
<F12> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
INSTITUTIONAL EQUITY FUNDS
Income from Investment Operations
---------------------------------------------
Net Realized
and Unrealized
Net Gains or
Asset Value, Net (Losses) Total From
Beginning Investment on Investment
of Period Income (Loss) Securities Operations
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------
PER SHARE DATA
- ------------------------------------------------------------------------------------------
SPECIAL GROWTH
- ------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F9> $33.19 $0.00 $8.49 $8.49
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 41.47 (0.04) 4.74 4.70
<F11>
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1997 41.58 (0.11) 8.49 8.38
<F11>
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1998 44.70 (0.14) (2.09) (2.23)
<F10>
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1999 38.01 0.02 0.60 0.62
<F11>
- -------------------------------------------------------------------------------------------
EMERGING GROWTH
- -------------------------------------------------------------------------------------------
Aug. 15, 19971 through
Oct. 31, 1997 10.00 0.02 0.29 0.31
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1998 10.31 0.05 (0.71) (0.66)
<F10>
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1999 9.58 (0.01) (0.24) (0.25)
- -------------------------------------------------------------------------------------------
MICROCAP
- -------------------------------------------------------------------------------------------
Aug. 1, 19951 through
June 30, 1996 10.00 (0.02) 6.14 6.12
- -------------------------------------------------------------------------------------------
July 1, 1996 through
Oct. 31, 1996 15.45 (0.07) 0.82 0.75
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1997 16.20 (0.15) 4.27 4.12
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1998 17.57 (0.22) (3.19) (3.41)
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1999 12.49 (0.19) 9.79 9.60
<F11>
- -------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F8>
- -------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F9> 19.99 0.12 (0.87) (0.75)
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1996 19.19 0.11 1.44 1.55
<F11>
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1997 20.27 0.10 (1.10) (1.00)
<F11>
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1998 18.64 0.24 (3.16) (2.92)
<F10>
- -------------------------------------------------------------------------------------------
Year Ended October 31, 1999 15.26 0.09 3.62 3.71
- -------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
INSTITUTIONAL EQUITY FUNDS
Less Distributions Supplemental Data and Ratios
------------------ -------------------------------------------
Net Ratio Ratio of Net
Dividends Distributions Assets of Net Investment
From Net From Net Asset End of Expenses Income (Loss) Portfolio
Investment Capital Total Value, End Total Period to Average to Average Turnover
Income Gains Distributions of Period Return (000s) Net Assets Net Assets Rate<F12>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA
- ----------------------------------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F9> $- $(0.21) $(0.21) $41.47 25.79% $434,228 0.90% 0.00% 79.25%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 - (4.59) (4.59) 41.58 12.58% 482,857 0.88% (0.10)% 103.34%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 - (5.26) (5.26) 44.70 22.44% 569,028 0.87% (0.25)% 97.40%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 - (4.46) (4.46) 38.01 (5.66)% 464,858 0.88% (0.32)% 77.39%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 - (0.31) (0.31) 38.32 1.56% 359,947 0.94% 0.04% 139.91%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
EMERGING GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
Aug. 15, 19971 through
Oct. 31, 1997 - - - 10.31 3.10% 48,044 0.90% 1.18% 14.51%
<F2> <F3><F5> <F3><F5> <F2>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.02) (0.05) (0.07) 9.58 (6.35)% 60,400 0.90% 0.49% 132.63%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.01) - (0.01) 9.32 (2.57)% 139,279 1.05% (0.10)% 115.65%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
MICROCAP
- ----------------------------------------------------------------------------------------------------------------------------------
Aug. 1, 19951 through
June 30, 1996 (0.05) (0.62) (0.67) 15.45 63.93% 63,595 1.74% (0.16)% 283.67%
<F2> <F3><F6> <F3><F6> <F2>
- ----------------------------------------------------------------------------------------------------------------------------------
July 1, 1996 through
Oct. 31, 1996 - - - 16.20 4.85% 66,368 1.72% (1.44)% 64.44%
<F3><F6> <F3><F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 - (2.75) (2.75) 17.57 30.12% 103,840 1.70% (1.20)% 158.39%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 - (1.67) (1.67) 12.49 (21.51)% 72,696 1.74% (1.38)% 135.61%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 - (0.03) (0.03) 22.06 77.06% 150,898 1.76% (1.18)% 200.09%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F8>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F9> (0.04) (0.01) (0.05) 19.19 (3.75)% 31,187 1.50% 0.66% 15.12%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.10) (0.37) (0.47) 20.27 8.21% 43,182 1.50% 0.62% 31.57%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.17) (0.46) (0.63) 18.64 (5.10)% 57,206 1.50% 0.50% 97.09%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.09) (0.37) (0.46) 15.26 (15.97)% 44,670 1.50% 1.37% 43.96%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.31) - (0.31) 18.66 24.74% 54,423 1.56% 0.80% 45.50%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2> Not annualized.
<F3> Annualized.
<F4> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.96%, 0.95%, 0.95%, 0.95%, 0.98%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 0.02%, (0.39)%, (0.32)%,
(0.17)%, (0.08)%, respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998 and for the period ended October
31, 1997 would have been 1.07%, 1.17%, 1.24%, respectively; and ratios of
net investment income to average net assets for the fiscal year ended
October 31, 1999, 1998 and for the period ended October 31, 1997 would have
been (0.12)%, 0.22%, 0.84%, respectively.
<F6> Without fees waived, the ratio of net expenses to average net assets for
the fiscal years ended October 31, 1999, 1998, 1997 and for the periods
ended October 31, 1996 and June 30, 1996 would have been 1.77%, 1.81%,
1.78%, 1.79%, 1.97%, respectively, and the ratio of net investment income
(loss) to average net assets for the fiscal years ended October 31, 1999,
1998, 1997 and for the periods ended October 31, 1996 and June 30, 1996
would have been (1.19)%. 1.45%, (1.28)%, (1.51)%, (0.39)%, respectively.
<F7> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
1.85%, 1.92%, 2.25%, 2.36%, 2.65%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 0.51%, 0.96%, (0.25)%,
(0.24)%, (0.49)%, respectively.
<F8> Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisers.
<F9> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareholders exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of the
close of business on January 9, 1995, and the results thereof combined with
the results of operations and distributions for each applicable class for
the period January 10, 1995, through October 31, 1995.
<F10> Net investment income (loss) per share represents net investment income
divided by the average shares outstanding throughout the period.
<F11> Net investment income (loss) per share is calculated using ending balances
prior to consideration of adjustments for permanent book and tax
differences.
<F12> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
FINANCIAL HIGHLIGHTS
RETAIL A SHARE EQUITY FUNDS
<TABLE>
<CAPTION>
Income from Investment Operations
---------------------------------------------
Net Realized
and Unrealized
Net Gains or
Asset Value, Net (Losses) Total From
Beginning Investment on Investment
of Period Income (Loss) Securities Operations
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------
PER SHARE DATA
- ------------------------------------------------------------------------------------------
BALANCED INCOME
- ------------------------------------------------------------------------------------------
Dec. 1, 19971 through
Oct. 31, 1998 $10.00 $0.28 $0.96 $1.24
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 11.00 0.28 0.38 0.66
- ------------------------------------------------------------------------------------------
BALANCED GROWTH
- ------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> 22.10 0.49 3.77 4.26
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 25.89 0.47 2.64 3.11
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 27.98 0.58 4.19 4.77
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 30.48 0.56 1.86 2.42
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 29.82 0.49 1.19 1.68
- ------------------------------------------------------------------------------------------
GROWTH AND INCOME
- ------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> 23.09 0.37 5.14 5.51
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 27.62 0.42 6.61 7.03
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 33.07 0.37 8.92 9.29
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 39.24 0.36 6.55 6.91
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 44.41 0.29 4.92 5.21
- ------------------------------------------------------------------------------------------
EQUITY INDEX
- ------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> 33.41 0.70 7.70 8.40
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 41.07 0.77 8.69 9.46
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 49.40 0.80 14.33 15.13
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 63.11 0.84 12.58 13.42
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 74.58 0.80 17.75 18.55
- ------------------------------------------------------------------------------------------
GROWTH
- ------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> 21.47 (0.02) 4.16 4.14
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 25.58 (0.07) 4.81 4.74
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 30.32 (0.05) 6.30 6.25
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 35.27 (0.02) 5.66 5.64
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 35.72 (0.12) 6.42 6.30
<F11>
- ------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Less Distributions Supplemental Data and Ratios
------------------ -------------------------------------------
Net Ratio Ratio of Net
Dividends Distributions Assets of Net Investment
From Net From Net Asset End of Expenses Income (Loss) Portfolio
Investment Capital Total Value, End Total Period to Average to Average Turnover
Income Gains Distributions of Period Return (000s) Net Assets Net Assets Rate<F12>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA
- ----------------------------------------------------------------------------------------------------------------------------------
BALANCED INCOME
- ----------------------------------------------------------------------------------------------------------------------------------
Dec. 1, 19971 through
Oct. 31, 1998 $(0.24) $- $(0.24) $11.00 12.46% $10,614 1.00% 2.82% 58.33%
<F2> <F3><F4> <F3><F4> <F2>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.28) (0.44) (0.72) 10.94 6.01% 13,087 1.18% 2.59% 48.46%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
BALANCED GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> (0.47) - (0.47) 25.89 19.55% 21,832 0.94% 2.05% 61.87%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.47) (0.55) (1.02) 27.98 12.30% 29,034 1.00% 1.80% 63.91%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.59) (1.68) (2.27) 30.48 18.07% 44,026 1.00% 2.06% 69.90%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.58) (2.50) (3.08) 29.82 8.60% 59,657 1.00% 1.91% 56.44%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.49) (0.95) (1.44) 30.06 5.56% 53,807 1.18% 1.59% 69.42%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> (0.38) (0.60) (0.98) 27.62 24.75% 42,424 1.09% 1.51% 47.85%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.39) (1.19) (1.58) 33.07 26.62% 71,310 1.15% 1.42% 51.37%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.39) (2.73) (3.12) 39.24 30.47% 128,070 1.12% 1.09% 31.36%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.35) (1.39) (1.74) 44.41 18.08% 190,331 1.12% 0.86% 48.56%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.35) (3.21) (3.56) 46.06 11.78% 194,089 1.17% 0.74% 62.20%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
EQUITY INDEX
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> (0.68) (0.06) (0.74) 41.07 25.79% 18,663 0.66% 2.14% 4.61%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.78) (0.35) (1.13) 49.40 23.36% 39,656 0.66% 1.76% 7.48%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.81) (0.61) (1.42) 63.11 31.08% 76,866 0.63% 1.40% 9.81%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.84) (1.11) (1.95) 74.58 21.63% 110,129 0.58% 1.18% 2.91%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.83) (0.47) (1.30) 91.83 25.01% 142,247 0.61% 0.92% 13.95%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> (0.03) - (0.03) 25.58 19.31% 10,105 1.09% (0.06)% 49.84%
<F8> <F8>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 - - - 30.32 18.53% 16,636 1.15% (0.29)% 56.75%
<F8> <F8>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 - (1.30) (1.30) 35.27 21.30% 25,043 1.14% (0.16)% 62.09%
<F8> <F8>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.02) (5.17) (5.19) 35.72 18.58% 38,213 1.14% (0.05)% 51.82%
<F8> <F8>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.02) (4.04) (4.06) 37.96 17.92% 47,238 1.19% (0.31)% 59.35%
<F8> <F8>
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2> Not annualized.
<F3> Annualized.
<F4> Without fees waived, ratios of net expenses to average net assets for the
fiscal year ended October 31, 1999 and the period ended October 31, 1998
would have been 1.48%, 1.63%, respectively; and ratio of net investment
income to average net assets for the fiscal year ended October 31, 1999 and
the period ended October 31, 1998 would have been 2.29%, 2.19%,
respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
1.25%, 1.24%, 1.25%, 1.28%, 1.25%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 1.52%, 1.67%, 1.80%,
1.52%, 1.74%, respectively.
<F6> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
1.18%, 1.19%, 1.19%, 1.23%, 1.20%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 0.73%, 0.79%, 1.02%,
1.35%, 1.40%, respectively.
<F7> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.68%, 0.69%, 0.70%, 0.73%, 0.73%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 0.85%, 1.07%, 1.33%,
1.69%, 2.07%, respectively.
<F8> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
1.20%, 1.21%, 1.21%, 1.23%, 1.21%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been (0.32)%, (0.12)%, (0.24)%,
(0.36)%, (0.18)%, respectively.
<F9> The total return calculation does not reflect the maximum sales charge of
4.50%.
<F10> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareholders exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of the
close of business on January 9, 1995, and the results thereof combined with
the results of operations and distributions for each applicable class for
the period January 10, 1995, through October 31, 1995.
<F11> Net investment income (loss) per share represents net investment income
divided by the average shares outstanding throughout the period.
<F12> Net investment income (loss) per share is calculated using ending balances
prior to consideration of adjustments for permanent book and tax
differences.
<F13> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
RETAIL A SHARE EQUITY FUNDS
Income from Investment Operations
---------------------------------------------
Net Realized
and Unrealized
Net Gains or
Asset Value, Net (Losses) Total From
Beginning Investment on Investment
of Period Income (Loss) Securities Operations
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------
PER SHARE DATA
- ------------------------------------------------------------------------------------------
SPECIAL GROWTH
- ------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> $33.19 $(0.07) $8.49 $8.42
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 41.40 (0.13) 4.70 4.57
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 41.38 (0.20) 8.44 8.24
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 44.36 (0.24) (2.07) (2.31)
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 37.59 (0.08) 0.60 0.52
<F11>
- ------------------------------------------------------------------------------------------
EMERGING GROWTH
- ------------------------------------------------------------------------------------------
Aug. 15, 19971 through
Oct. 31, 1997 10.00 0.02 0.29 0.31
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 10.31 0.03 (0.71) (0.68)
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 9.56 (0.02) (0.24) (0.26)
- ------------------------------------------------------------------------------------------
MICROCAP
- ------------------------------------------------------------------------------------------
Aug. 1, 19951 through
June 30, 1996 10.00 (0.02) 6.10 6.08
- ------------------------------------------------------------------------------------------
July 1, 1996 through
Oct. 31, 1996 15.42 (0.08) 0.82 0.74
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 16.16 (0.18) 4.24 4.06
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 17.47 (0.25) (3.17) (3.42)
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 12.38 (0.26) 9.71 9.45
<F12>
- ------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F8>
- ------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> 19.99 0.08 (0.87) (0.79)
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1996 19.15 0.07 1.43 1.50
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1997 20.21 0.06 (1.10) (1.04)
<F12>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1998 18.58 0.20 (3.15) (2.95)
<F11>
- ------------------------------------------------------------------------------------------
Year Ended October 31, 1999 15.18 0.03 3.62 3.65
- ------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Less Distributions Supplemental Data and Ratios
------------------ -------------------------------------------
Net Ratio Ratio of Net
Dividends Distributions Assets of Net Investment
From Net From Net Asset End of Expenses Income (Loss) Portfolio
Investment Capital Total Value, End Total Period to Average to Average Turnover
Income Gains Distributions of Period Return (000s) Net Assets Net Assets Rate<F12>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA
- ----------------------------------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> $- $(0.21) $(0.21) $41.40 25.56% $87,269 1.09% (0.19)% 79.25%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 - (4.59) (4.59) 41.38 12.27% 111,159 1.13% (0.35)% 103.34%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 - (5.26) (5.26) 44.36 22.18% 147,396 1.12% (0.50)% 97.40%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 - (4.46) (4.46) 37.59 (5.91)% 136,146 1.13% (0.57)% 77.39%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 - (0.31) (0.31) 37.80 1.31% 95,758 1.19% (0.21)% 139.91%
<F4> <F4>
- ----------------------------------------------------------------------------------------------------------------------------------
EMERGING GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
Aug. 15, 19971 through
Oct. 31, 1997 - - - 10.31 3.10% 5,355 1.15% 0.93% 14.51%
<F2> <F3><F5> <F3><F5> <F2>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 $(0.02) (0.05) (0.07) 9.56 (6.58)% 12,884 1.15% 0.24% 132.63%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.01) - (0.01) 9.29 (2.72)% 9,957 1.30% (0.35)% 115.65%
<F5> <F5>
- ----------------------------------------------------------------------------------------------------------------------------------
MICROCAP
- ----------------------------------------------------------------------------------------------------------------------------------
Aug. 1, 19951 through
June 30, 1996 (0.04) (0.62) (0.66) 15.42 63.52% 9,036 1.99% (0.36)% 283.67%
<F2> <F3><F6> <F3><F6> <F2>
- ----------------------------------------------------------------------------------------------------------------------------------
July 1, 1996 through
Oct. 31, 1996 - - - 16.16 4.80% 9,273 1.97% (1.69)% 64.44%
<F2> <F3><F6> <F3><F6> <F2>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 - (2.75) (2.75) 17.47 29.78% 16,793 1.95% (1.45)% 158.39%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 - (1.67) (1.67) 12.38 (21.71)% 12,419 1.99% (1.63)% 135.61%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 - (0.03) (0.03) 21.80 76.54% 21,988 2.01% (1.43)% 200.09%
<F6> <F6>
- ----------------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F8>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
October 31, 1995<F10> (0.04) (0.01) (0.05) 19.15 (3.95)% 1,633 1.70% 0.46% 15.12%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.07) (0.37) (0.44) 20.21 7.95% 3,769 1.75% 0.37% 31.57%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.13) (0.46) (0.59) 18.58 (5.30)% 6,502 1.75% 0.25% 97.09%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.08) (0.37) (0.45) 15.18 (16.16)% 6,486 1.75% 1.12% 43.96%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.30) - (0.30) 18.53 24.48% 6,418 1.81% 0.56% 45.50%
<F7> <F7>
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2> Not annualized.
<F3> Annualized.
<F4> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
1.21%, 1.20%, 1.20%, 1.20%, 1.17%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been (0.23)%, (0.64)%, (0.57)%,
(0.42)%, (0.27)%, respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998 and the period ended October 31,
1997 would have been 1.32%, 1.42%, 1.59%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998 and the period ended October 31, 1997 would have been
(0.37)%, (0.03)%, 0.59%, respectively.
<F6> Without fees waived, the ratio of net expenses to average net assets for
the fiscal years ended October 31, 1999, 1998, 1997, 1996 and the period
ended June 30, 1996 would have been 2.02%, 2.06%, 2.03%, 2.04%, 2.22%,
respectively, and the ratio of net investment income (loss) to average net
assets for the fiscal years ended October 31, 1999, 1998, 1997, 1996 and
the period ended June 30, 1996 would have been (1.44)%, (1.70)%, (1.53)%,
(1.76)%, (0.59)%, respectively.
<F7> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
2.10%, 2.16%, 2.50%, 2.61%, 2.85%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been (0.27)%, 0.71%, (0.50)%,
(0.48)%, (0.69)%, respectively.
<F8> Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisors.
<F9> The total return calculation does not reflect the maximum sales charge of
4.50%.
<F10> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareholders exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of the
close of business on January 9, 1995, and the results thereof combined with
the results of operations and distributions for each applicable class for
the period January 10, 1995, through October 31, 1995.
<F11> Net investment income (loss) per share represents net investment income
divided by the average shares outstanding throughout the period.
<F12> Net investment income (loss) per share is calculated using ending balances
prior to consideration of adjustments for permanent book and tax
differences.
<F13> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
RETAIL B SHARE EQUITY FUNDS
Income from Investment Operations
---------------------------------------------
Net Realized
and Unrealized
Net Gains or
Asset Value, Net (Losses) Total From
Beginning Investment on Investment
of Period Income (Loss) Securities Operations
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------
PER SHARE DATA
- ------------------------------------------------------------------------------------------
BALANCED INCOME
- ------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 $10.87 $0.14 $0.07 $0.21
<F13>
- ------------------------------------------------------------------------------------------
BALANCED GROWTH
- ------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 30.25 0.17 (0.10) 0.07
<F13>
- ------------------------------------------------------------------------------------------
GROWTH AND INCOME
- ------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 44.64 0.02 1.40 1.42
<F13>
- ------------------------------------------------------------------------------------------
EQUITY INDEX
- ------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 83.72 0.08 8.18 8.26
<F13>
- ------------------------------------------------------------------------------------------
GROWTH
- ------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 36.92 (0.29) 1.15 0.86
<F13>
- ------------------------------------------------------------------------------------------
SPECIAL GROWTH
- ------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 37.57 (0.23) 0.29 0.06
<F13>
- ------------------------------------------------------------------------------------------
EMERGING GROWTH
- ------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 9.57 (0.07) (0.25) (0.32)
<F13>
- ------------------------------------------------------------------------------------------
MICROCAP
- ------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 13.74 (0.30) 8.25 7.95
<F13>
- ------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F10>
- ------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 14.71 (0.10) 3.76 3.66
<F13>
- ------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
RETAIL B SHARE EQUITY FUNDS
Less Distributions Supplemental Data and Ratios
------------------ -------------------------------------------
Net Ratio Ratio of Net
Dividends Distributions Assets of Net Investment
From Net From Net Asset End of Expenses Income (Loss) Portfolio
Investment Capital Total Value, End Total Period to Average to Average Turnover
Income Gains Distributions of Period Return (000s) Net Assets Net Assets Rate<F12>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA
- ----------------------------------------------------------------------------------------------------------------------------------
BALANCED INCOME
- ----------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 $(0.12) $- $(0.12) $10.96 1.97% $1,571 1.97% 1.90% 48.46%
<F2> <F3><F4> <F3><F4>
- ----------------------------------------------------------------------------------------------------------------------------------
BALANCED GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 (0.17) - (0.17) 30.15 0.25% 630 1.97% 0.87% 69.42%
<F2> <F3><F5> <F3><F5>
- ----------------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME
- ----------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 (0.03) - (0.03) 46.03 3.19% 1,550 1.94% 0.05% 62.20%
<F2> <F3> <F3>
- ----------------------------------------------------------------------------------------------------------------------------------
EQUITY INDEX
- ----------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 (0.26) - (0.26) 91.72 9.88% 4,613 1.37% 0.13% 13.95%
<F2> <F3><F6> <F3><F6>
- ----------------------------------------------------------------------------------------------------------------------------------
GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 - - - 37.78 2.33% 722 1.96% (1.17)% 59.35%
<F2> <F3><F7> <F3><F7>
- ----------------------------------------------------------------------------------------------------------------------------------
SPECIAL GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 - - - 37.63 0.16% 126 1.95% (0.89)% 139.91%
<F2> <F3><F8> <F3><F8>
- ----------------------------------------------------------------------------------------------------------------------------------
EMERGING GROWTH
- ----------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 - - - 9.25 (3.34)% 80 2.08% (1.17)% 115.65%
<F2> <F3> <F3>
- ----------------------------------------------------------------------------------------------------------------------------------
MICROCAP
- ----------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 - - - 21.69 57.86% 140 2.78% (2.36)% 200.09%
<F2> <F3> <F3>
- ----------------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY<F10>
- ----------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 - - - 18.37 24.88% 44 2.57% (0.85)% 45.50%
<F2> <F3><F9> <F3><F9>
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2> Not annualized.
<F3> Annualized.
<F4> Without fees waived, ratio of net expenses to average net assets for the
year ended October 31, 1999 would have been 2.21% and the ratio of net
investment income to average net assets for the year ended October 31, 1999
would have been 1.66%.
<F5> Without fees waived, ratio of net expenses to average net assets for the
year ended October 31, 1999 would have been 2.03% and the ratio of net
investment income to average net assets for the year ended October 31, 1999
would have been 0.81%.
<F6> Without fees waived, ratio of net expenses to average net assets for the
year ended October 31, 1999 would have been 1.43% and the ratio of net
investment income to average net assets for the year ended October 31, 1999
would have been 0.07%.
<F7> Without fees waived, ratio of net expenses to average net assets for the
year ended October 31, 1999 would have been 1.97% and the ratio of net
investment income to average net assets for the year ended October 31, 1999
would have been (1.18)%.
<F8> Without fees waived, ratio of net expenses to average net assets for the
year ended October 31, 1999 would have been 1.97% and the ratio of net
investment income to average net assets for the year ended October 31, 1999
would have been (0.91)%.
<F9> Without fees waived, ratio of net expenses to average net assets for the
year ended October 31, 1999 would have been 2.85% and the ratio of net
investment income to average net assets for theyear ended October 31, 1999
would have been (1.13)%.
<F10> Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisors.
<F11> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
<F12> The total return calculation does not reflect the maximum deferred sales
charge of 5.00%.
<F13> Net investment income per share represents net investment income divided
by the average shares outstanding throughout the period.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED INCOME FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
- --------- --------------
COMMON STOCKS 46.7%
BANKING 4.5%
16,300 Bank of New York Company, Inc. $683
15,800 Mellon Bank Corporation 584
8,100 Northern Trust Corporation 782
17,500 Wells Fargo Company, Inc. 838
--------
2,887
--------
BUILDING MATERIALS 1.3%
3,400 Johnson Controls, Inc. 207
15,500 Vulcan Materials Company 640
--------
847
--------
BUSINESS MACHINES & SOFTWARE 0.5%
3,000 International Business Machines Corporation 295
--------
BUSINESS SERVICES 1.6%
8,300 Automatic Data Processing, Inc. 400
9,600 Manpower, Inc. 337
11,800 Viad Corp. 290
--------
1,027
--------
CHEMICALS 1.1%
11,700 Ecolab, Inc. 396
7,100 Milpore Corporation 226
2,000 Valspar Corporation 60
--------
682
--------
COMMUNICATIONS & MEDIA 3.8%
6,700 CBS Corporation <F1> 327
21,100 Interpublic Group of Companies, Inc. 857
4,400 Knight-Ridder Inc. 279
13,800 New York Times Company - Class A 555
5,400 Time Warner, Inc. 376
1,900 True North Communications, Inc. 77
--------
2,471
--------
CONSUMER PRODUCTS 1.2%
7,450 Avery Dennison Corporation 466
10,500 Masco Corporation 320
--------
786
--------
COSMETICS & SOAP 1.3%
9,200 Estee Lauder Companies - Class A 429
4,100 Procter & Gamble Company 430
--------
859
--------
Number Market Value
of Shares (in thousands)
- --------- -------------
DRUGS/MEDICAL SUPPLIES 5.1%
10,400 American Home Products Corporation $543
11,900 Bristol Myers Squibb Company 914
6,900 Eli Lilly & Company 475
4,800 Johnson & Johnson 503
6,700 Medtronic, Inc. 232
4,100 Merck & Co., Inc. 326
7,500 Pfizer, Inc. 296
--------
3,289
--------
ELECTRONICS 1.5%
2,700 General Electric Company 366
7,600 Molex, Inc. - Class A 251
3,700 Texas Instruments, Inc. 332
--------
949
--------
ELECTRIC UTILITIES 1.1%
5,900 Duke Power Company 333
10,900 Illinova Corporation 347
--------
680
--------
FINANCE 0.4%
5,800 Household International, Inc. 259
--------
FINANCIAL SERVICES 2.6%
12,200 Alliance Capital Management L.P. 335
3,200 American Express Company 493
5,500 Marsh & McLennan Companies, Inc. 435
7,700 MBIA, Inc. 439
--------
1,702
--------
FOOD, BEVERAGES & TOBACCO 2.2%
15,100 McCormick & Company, Incorporated 474
19,500 PepsiCo, Inc. 676
7,400 Sysco Corporation 284
--------
1,434
--------
HEALTH CARE SERVICES & SUPPLIES 0.6%
5,100 Warner-Lambert Company 407
--------
INSURANCE 0.9%
10,900 Hartford Life - Class A 570
--------
METALS & MINERALS 0.4%
8,800 USX Corporation - Marathon Group, Inc. 256
--------
MULTI-INDUSTRY 2.1%
675 Illinois Tool Works Inc. 49
12,200 Pentair, Inc. 459
21,800 Tyco International, Ltd. 871
--------
1,379
--------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED INCOME FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
- -------- --------------
NATURAL GAS 1.0%
16,700 Enron Corporation $667
--------
OIL - DOMESTIC 1.1%
9,200 Phillips Petroleum Company 428
4,200 Schlumberger Limited 254
--------
682
--------
OIL - INTERNATIONAL 0.8%
5,500 Mobil Corporation 531
--------
PAPER & FOREST PRODUCTS 1.3%
4,400 Consolidated Papers, Inc. 138
8,400 Kimberly-Clark Corporation 530
2,800 Weyerhauser Company 167
--------
835
--------
PRINTING & PUBLISHING 1.6%
5,800 Houghton Mifflin Company 246
13,200 McGraw-Hill, Inc. 787
--------
1,033
--------
REAL ESTATE INVESTMENT TRUSTS (REITS) 1.0%
8,975 AMB Property Corporation 178
6,100 Boston Properties, Inc. 182
7,200 Post Properties, Inc. 278
--------
638
--------
RETAIL 2.0%
4,700 Albertson's, Inc. 171
8,635 Gap, Inc. 321
6,900 Tandy Corporation 434
13,000 Walgreen Company 327
--------
1,253
--------
SEMICONDUCTORS 0.8%
6,400 Intel Corporation 496
--------
TELECOMMUNICATIONS 3.4%
16,300 ALLTEL Corporation 1,357
5,100 Lucent Technologies, Inc. 328
10,000 SBC Communications, Inc. 509
--------
2,194
--------
TELECOMMUNICATIONS EQUIPMENT 0.5%
4,800 Nortel Networks Corporation 297
--------
TEXTILES & APPAREL 1.0%
15,200 CVS Corporation 660
--------
Total Common Stocks (Cost $24,776) 30,065
--------
Number Market Value
of Shares (in thousands)
- ---------- --------------
PREFERRED STOCKS 0.8%
NATURAL GAS 0.4%
10,900 Enron Corporation, 7.00%, 7/31/02
(convertible to EOG Resources, common stock) $251
FOOD, BEVERAGES & TOBACCO 0.4%
5,800 Seagram Company Ltd., 7.50%, 6/21/02 (convertible
to Seagram Company Ltd. common stock) 287
--------
Total Preferred Stocks (Cost $535) 538
--------
Principal
Amount
(in thousands)
- -------------
LONG-TERM INVESTMENTS 43.4%
ASSET-BACKED SECURITIES 5.5%
AUTO LOAN RECEIVABLES 1.4%
Banc One Auto Grantor Trust,
$84 Series 1997-A, Class A, 6.27%, 11/20/03 84
Chase Manhattan Auto Owner Trust,
300 Series 1997-B, Class A5, 6.60%, 3/15/02 300
Honda Auto Least Trust,
500 Series 1999-A, Class A5, 6.65%, 7/15/05 502
--------
886
--------
CREDIT CARD RECEIVABLES 2.9%
Chemical Master Credit Card Trust I,
250 Series 1995-2, Class A, 6.23%, 6/15/03 249
Citibank Credit Card Master Trust I, Principal Only:
300 Series 1996-1, Class A, 0.00%, 2/07/01 276
800 Series 1997-6, Class A, 0.00%, 8/15/06 577
Discover Card Master Trust I,
500 Series 1995-2, Class A, 6.55%, 8/15/00 500
Sears Credit Account Master Trust,
250 Series 1995-2, Class A, 8.10%, 1/15/01 253
--------
1,855
--------
HOME EQUITY LOAN RECEIVABLES 1.2%
Contimortgage Home Equity Loan Trust,
300 Series 1997-3, Class A9, 7.12%, 8/15/28 294
GE Capital Mortgage Services, Inc.,
200 Series 1996-HE1 Class A4, 7.30%, 2/25/25 200
Green Tree Home Equity Loan Trust,
300 Series 1997-B, Class A6, 7.12%, 4/15/27 301
--------
795
--------
CORPORATE BONDS 13.0%
ABN Amro Bank Guarantee,
250 7.25%, 5/31/05 250
America West Airlines Pass-Thru Certificates,
150 8.54%, 1/02/06 (Acquired 9/14/99, Cost $150)** 150
AT&T Capital Corp. Company Guarantee,
200 6.25%, 5/15/01 199
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED INCOME FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Market
Amount Value
(in thousands) (in thousands)
- -------------- --------------
CORPORATE BONDS 13.0% (CONT.)
Associates Corporation of North America Senior Notes,
$150 7.50%, 4/15/02 153
Bank One Corporation Notes,
250 6.875%, 8/01/06 246
BankAmerica Corporation Subordinated Notes,
185 9.20%, 5/15/03 198
BankBoston Corporation Subordinated Notes,
200 6.625%, 2/01/04 196
Bankers Trust Corporation Subordinated Notes,
200 7.50%, 11/15/15 198
Bank of New York Subordinated Notes,
150 7.875%, 11/15/02 154
Barclays North American Capital Corp. Debentures,
300 9.75%, 5/15/21 327
Citicorp Subordinated Notes,
100 9.50%, 2/01/02 106
Conectiv, Inc. Medium Term Notes,
225 6.73%, 6/01/06 221
Continental Cablevision, Inc. Debentures,
100 9.50%, 8/01/13 111
Donaldson,Lufkin & Jenrette Senior Notes,
200 5.875%, 4/01/02 195
Duty Free International, Inc. Notes,
250 7.00%, 1/15/04 251
Dynegy, Inc. Senior Notes,
200 7.45%, 7/15/06 199
Federal Express Corporation Notes,
180 9.65%, 6/15/12 210
FPL Group Capital, Inc. Guaranteed Notes,
150 7.625%, 9/15/06 153
Goldman Sachs Group Notes,
400 6.25%, 2/01/03 (Acquired 6/30/99, Cost $393)<F2> 390
Lehman Brothers, Inc. Senior Subordinated Notes,
300 9.875%, 10/15/00 309
Lehman Brothers Holdings, Inc. Senior Notes,
150 8.75%, 5/15/02 156
Lehman Brothers Holdings, Inc. Medium Term Notes,
375 7.50%, 9/01/06 374
Marlin Water Trust Senior Notes,
97 7.09%, 12/15/01 (Acquired 12/9/98, Cost $97)<F2> 97
Merrill Lynch & Co. Notes,
225 8.30%, 11/01/02 234
Midlantic Corporation Subordinated Notes,
240 9.20%, 8/01/01 250
Morgan Stanley Group Debentures,
300 8.875%, 10/15/01 312
National Westminster Bank Debentures,
300 9.375%, 11/15/03 324
Oneok, Inc. Notes,
125 7.75%, 8/15/06 126
Paine Webber Group, Inc. Subordinated Notes,
200 7.75%, 9/01/02 203
Principal Market
Amount Value
(in thousands) (in thousands)
- ------------- --------------
CORPORATE BONDS 13.0% (CONT.)
Principal Financial Group Senior Notes,
$400 8.20%, 8/15/09 (Acquired 8/18/99, Cost $399)<F2> $406
PSI Energy, Inc. Debentures,
150 7.85%, 10/15/07 151
JC Penney Company, Inc. Debentures,
150 8.25%, 8/15/22 148
Salomon, Inc. Notes:
409 7.50%, 2/01/03 415
277 7.00%, 6/15/03 277
Standard Federal Bancorp Medium Term Notes,
250 7.75%, 7/17/06 252
Washington Mutual, Inc. Notes,
250 7.50%, 8/15/06 251
Westdeutsche Landesbank Subordinated Notes,
200 6.05%, 1/15/09 183
--------
8,375
--------
INTERNATIONAL/YANKEE (U.S. $ DENOMINATED) 1.7%
AT&T Canada, Inc. Senior Notes,
300 9.95%, 6/15/08_ 233
Ford Capital BV Debentures:
200 9.375%, 5/15/01 208
150 9.50%, 6/01/10 172
Household Netherlands BV Company Guarantee,
125 6.20%, 12/01/03 122
Korea Development Bank Bonds,
230 7.125%, 9/17/01 228
Norsk Hydro A/S Debentures,
50 9.00%, 4/15/12 56
Quebec Province Debentures,
50 11.00%, 6/15/15 53
Wharf Capital International Ltd. Notes,
50 7.625%, 3/13/07 45
--------
1,117
--------
U.S. GOVERNMENT AGENCY-BACKED MORTGAGE ISSUES 0.7%
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC),
61 Series 1201, Class E, 7.40%, 12/15/21 61
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC):
187 Series 1993-37, Class B, 7.00%, 7/25/02 188
46 Series 1989-2, Class D, 8.80%, 1/25/19 47
55 Series 1990-89, Class K, 6.50%, 7/25/20 54
46 Series 1991-147, Class K, 7.00%, 1/25/21 46
Government National Mortgage Association (GNMA)
Real Estate Mortgage Investment Conduit (REMIC),
77 Series 3, Class F, 6.50%, 6/17/20 75
--------
471
--------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED INCOME FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Market
Amount Value
(in thousands) (in thousands)
- ------------- -------------
U.S. TREASURY OBLIGATIONS 22.5%
U.S. Treasury Bonds,
$4,725 10.75%, 8/15/05 $5,757
U.S. Treasury Notes,
1,850 6.375%, 8/15/02 1,873
U.S. Treasury Strips, Principal Only,
9,280 0.00%, 11/15/04 6,819
--------
14,449
--------
Total Long-Term Investments (Cost $28,411) 27,948
--------
Number
of Shares
(in thousands)
- --------------
SHORT-TERM INVESTMENTS 10.8%
INVESTMENT COMPANIES 4.6%
119 Financial Square Prime Obligation Fund 119
2,810 Short-Term Investments Co. Liquid Assets Portfolio 2,810
--------
Total Investment Companies (Cost $2,929) 2,929
--------
Principal
Amount
(in thousands)
- --------------
VARIABLE RATE DEMAND NOTES 6.2%
$2,000 American Family Financial Services, Inc. 2,000
2,000 General Mills, Inc. 2,000
--------
Total Variable Rate Demand Notes (Cost $4,000) 4,000
--------
Total Short-Term Investments (Cost $6,929) 6,929
--------
Total Investments (Cost $60,651) 101.7% 65,480
--------
Liabilities, less Other Assets (1.7)% (1,094)
--------
TOTAL NET ASSETS 100.0% $64,386
=======
<F1>Non-income producing
<F2>Unregistered security
<F3>Step bond
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
- ---------- --------------
COMMON STOCKS 62.7%
AEROSPACE & AIRCRAFT 0.4%
7,100 Cordant Technologies, Inc. $221
10,200 General Dynamics Corporation 565
16,100 Orbital Sciences Corporation<F1> 237
--------
1,023
--------
AIR TRANSPORTATION 0.1%
12,400 Southwest Airlines 208
--------
AUTOS - RENTAL 0.1%
13,200 Avis Rent A Car, Inc.<F1> 236
--------
BANKING 1.6%
17,850 Charter One Financial, Inc. 438
14,300 Fifth Third Bancorp 1,056
15,000 First Tennessee National Corporation 510
9,600 Marshall & Ilsley Corporation 644
11,800 North Fork Bancorporation, Inc. 244
6,200 Old Kent Financial Corporation 253
8,500 TCF Financial Corporation 251
8,000 Zions Bancorporation 472
--------
3,868
--------
BATTERIES 0.1%
10,800 Rayovac Corporation<F1> 269
--------
BUILDING & CONSTRUCTION 0.5%
1,500 Dycom Industries, Inc.<F1> 49
6,700 Granite Construction, Inc. 139
11,900 Martin Marietta Materials, Inc. 463
5,000 Southdown, Inc. 242
6,400 Texas Industries, Inc. 229
8,400 U.S. Aggregates, Inc.<F1> 100
--------
1,222
--------
BUSINESS MACHINES & SOFTWARE 0.6%
8,250 Network Associates, Inc.<F1> 151
16,800 Sterling Software, Inc. <F1> 369
13,700 Synopsys, Inc.<F1> 854
--------
1,374
--------
BUSINESS SERVICES 7.7%
16,700 Affiliated Computer Services, Inc.<F1> 635
23,100 The BISYS Group, Inc.<F1> 1,178
34,300 Ceridian Corporation<F1> 752
36,500 Cintas Corporation 2,199
10,200 Computer Sciences Corporation<F1> 701
41,750 Concord EFS, Inc. <F1> 1,130
40,200 First Data Corporation 1,837
43,030 FIserv, Inc. <F1> 1,377
18,600 F.Y.I. Incorporated <F1> 614
7,100 Lason Holdings, Inc.<F1> 264
Number Market Value
of Shares (in thousands)
- ---------- --------------
BUSINESS SERVICES 7.7% (CONT.)
4,700 NCO Group, Inc.<F1> $199
42,500 NOVA Corporation<F1> 1,105
43,700 Pittston Brink's Group 838
17,900 Sabre Group Holdings, Inc. <F1> 795
23,700 The Source Information Management Company<F1> 284
99,200 SunGard Data Systems, Inc. 2,424
40,800 Sykes Enterprises, Inc.<F1> 1,260
19,100 Viad Corp. 469
--------
18,061
--------
COMMUNICATIONS & MEDIA 3.0%
8,000 ACNielson Corporation<F1> 176
8,800 AMFM, Inc.<F1> 616
4,600 CD Radio, Inc.<F1> 117
3,000 Citadel Communications Corporation<F1> 145
10,900 Clear Channel Communications 876
400 Cumulus Media, Inc. - Class A<F1> 20
24,200 Infinity Broadcasting<F1> 836
40,400 Interpublic Group of Companies, Inc. 1,641
22,200 Omnicom Group, Inc. 1,954
3,500 Spanish Broadcasting Systems, Inc.<F1> 93
16,600 True North Communications, Inc. 669
--------
7,143
--------
COMPUTERS 1.5%
10,500 CDW Computer Centers, Inc. <F1> 648
12,200 Dell Computer Corporation <F1> 490
17,100 EMC Corporation<F1> 1,248
9,900 Sun Microsystems, Inc.<F1> 1,048
--------
3,434
--------
CONSUMER PRODUCTS 0.1%
11,500 Steiner Leisure Limited 221
--------
DATA PROCESSING 1.1%
87,400 Acxiom Corporation <F1> 1,442
9,900 CSG Systems International, Inc. <F1> 340
8,500 National Computer Systems, Inc. 321
18,800 National Data Corporation 451
--------
2,554
--------
DRUGS 2.9%
4,400 Alpharma, Inc. - Class A 155
25,700 Eli Lilly &Company 1,770
13,800 Merck & Co., Inc. 1,098
25,600 Schering Plough Corporation 1,267
7,400 Shire Pharmaceuticals Group PLC - ADR<F1> 235
13,400 Warner-Lambert Company 1,069
37,300 Watson Pharmaceuticals, Inc.<F1> 1,184
--------
6,778
--------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
- --------- --------------
ELECTRIC COMPONENTS & SEMICONDUCTORS 7.3%
4,500 Alpha Industries, Inc. <F1> $249
10,800 Altera Corporation<F1> 525
15,200 Analog Devices,Inc. <F1> 807
4,500 Applied Materials, Inc. <F1> 404
13,200 Atmel Corporation<F1> 510
8,800 ATMI, Inc. <F1> 237
6,400 Burr-Brown Corporation<F1> 252
4,200 Celestica, Inc. <F1> 234
4,700 Conexant Systems, Inc. <F1> 439
6,300 Credence Systems Corporation<F1> 287
5,200 CTS Corporation 294
10,700 Cypress Semiconductor Corporation<F1> 274
4,600 Etec Systems, Inc. <F1> 176
23,400 Intel Corporation 1,812
6,500 Kent Electronics Corporation<F1> 126
5,900 KLA-Tencor Corporation<F1> 467
3,700 Linear Technology Corporation 259
5,900 LSI Logic Corporation<F1> 314
8,200 Maxim Integrated Products, Inc. <F1> 647
5,000 Micrel, Inc. <F1> 272
44,010 Molex, Inc. - Class A 1,452
9,400 Novellus Systems, Inc. <F1> 729
3,500 PMC - Sierra, Inc. <F1> 330
5,200 Phototronics, Inc. <F1> 109
1,000 QLogic Corporation<F1> 104
5,600 Sanmina Corporation<F1> 504
3,000 SDL, Inc. <F1> 370
28,750 Seitel, Inc. <F1> 228
25,300 Teradyne,Inc. <F1> 974
18,400 Texas Instruments Incorporated 1,651
8,250 TranSwitch Corporation<F1> 388
5,600 TriQuint Semiconductor, Inc. <F1> 448
5,200 Vitesse Semiconductor<F1> 239
13,500 Xilinx, Inc. <F1> 1,063
--------
17,174
--------
ENERGY 0.1%
10,300 Illinova Corporation 328
--------
ENTERTAINMENT & LEISURE 0.4%
41,100 American Skiing Company<F1> 193
6,400 Cinar Films Inc. - Class B <F1> 111
23,300 The Walt Disney Company 615
5,800 Imax Corporation<F1> 120
--------
1,039
--------
FINANCIAL SERVICES 3.8%
24,200 Associates First Capital Corporation 883
6,600 Federal National Mortgage Association 467
6,500 Federated Investors, Inc. 112
10,400 Financial Security Holdings 586
21,900 Franklin Resources, Inc. 767
Number Market Value
of Shares (in thousands)
- --------- -------------
FINANCIAL SERVICES 3.8% (CONT.)
68,700 MBNA Corporation $1,898
10,500 Morgan Stanley Dean Witter & Company 1,158
4,950 The PMI Group, Inc. 257
9,100 The Charles Schwab Corporation 354
31,600 State Street Corporation 2,406
--------
8,888
--------
FOOD - DISTRIBUTION 0.4%
10,800 SUPERVALU, Inc. 227
43,500 U.S. Foodservice<F1> 835
--------
1,062
--------
HEALTH CARE SERVICES & SUPPLIES 1.8%
23,700 AmeriSource Health Corporation<F1> 356
26,225 Cardinal Health, Inc. 1,131
2,300 Express Scripts, Inc. <F1> 113
5,700 Forest Laboratories, Inc. <F1> 261
64,653 Health Management Associates, Inc. - Class A <F1> 574
47,200 IMS Health Incorporated 1,369
18,000 Lincare Holdings, Inc. <F1> 506
--------
4,310
--------
HOUSING 0.1%
13,300 Toll Brothers, Inc. <F1> 233
--------
INSURANCE 4.9%
9,000 AFLAC, Inc. 460
24,300 Ambac Financial Group, Inc. 1,452
24,955 American International Group 2,569
9,100 Arthur J. Gallagher & Company 471
18,300 Hartford Life - Class A 956
36,400 MGIC Investment Corporation 2,175
7,100 Nationwide Financial Services,Inc. 269
65,400 Protective Life Corporation 2,367
15,358 Radian Group, Inc. 811
--------
11,530
--------
INTERNET PRODUCTS & SERVICES 0.3%
3,400 America Online, Inc.<F1> 441
6,500 Concentric Network Corporation<F1> 167
--------
608
--------
MEDICAL INSTRUMENTS 2.4%
34,100 Biomet, Inc. 1,027
29,300 Guidant Corporation 1,447
6,800 LaserSight, Inc.<F1> 94
46,000 Medtronic, Inc. 1,593
20,800 Stryker Corporation 1,284
3,500 VISX, Inc.<F1> 219
--------
5,664
--------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
- --------- --------------
MISCELLANEOUS 0.1%
5,400 Kulicke & Soffa Industries, Inc.<F1> $159
5,500 Power-One, Inc.<F1> 110
--------
269
--------
MULTI-INDUSTRY 1.1%
5,700 Pentair, Inc. 214
58,600 Tyco International, Ltd. 2,340
--------
2,554
--------
NATURAL GAS 0.8%
47,400 Enron Corporation 1,893
NETWORKING PRODUCTS 1.1%
9,700 Ancor Communications, Inc.<F1> 307
5,300 Black Box Corporation<F1> 269
21,850 Cisco Systems, Inc.<F1> 1,617
2,500 Computer Network Technology Corporation<F1> 40
700 Emulex Corporation<F1> 109
3,700 MMC Networks, Inc.<F1> 118
8,900 Network Access Solutions Corporation<F1> 115
--------
2,575
--------
OIL & GAS - DOMESTIC 1.4%
14,100 Burlington Resources, Inc. 492
500 Devon Energy Corporation 19
80,200 EOG Resources, Inc. 1,669
40,950 Forest Oil Corporation<F1> 548
6,100 Newfield Exploration Company<F1> 180
4,400 St. Mary Land & Exploration Company 112
12,200 Valero Energy Corporation 224
--------
3,244
--------
OIL & GAS SERVICES 0.7%
9,100 El Paso Energy Corporation 373
9,900 Nabors Industries, Inc.<F1> 225
27,300 Petroleum Geo-Services ASA - ADR<F1> 399
10,900 Schlumberger Limited<F1> 660
--------
1,657
--------
PAPER & RELATED PRODUCTS 0.1%
5,500 Consolidated Papers, Inc. 172
--------
POLLUTION CONTROL 0.1%
11,825 Tetra Technologies, Inc. <F1> 188
--------
PRINTING & PUBLISHING 0.1%
4,700 Scholastic Corporation<F1> 219
2,750 Valassis Communications, Inc.<F1> 118
--------
337
--------
Number Market Value
of Shares (in thousands)
- ---------- -------------
RESTAURANTS 0.2%
8,900 Brinker International, Inc.<F1> $207
10,200 Starbucks Corporation<F1> 277
--------
484
--------
RETAIL 6.6%
5,600 Ames Department Stores, Inc. <F1> 177
29,400 BJ's Wholesale Club 906
9,200 Costco Companies, Inc. <F1> 739
13,700 Dayton Hudson Corporation 885
42,865 Dollar General Corporation 1,131
63,700 Family Dollar Stores 1,314
62,900 Goody's Family Clothing, Inc. <F1> 637
9,800 Home Depot, Inc. 740
12,300 Kohl's Corporation<F1> 920
33,000 Kroger Company<F1> 687
29,920 Lowe's Companies, Inc. 1,646
26,500 The Men's Wearhouse, Inc. <F1> 581
20,800 Pier 1 Imports, Inc. 124
5,550 Regis Corporation 103
45,400 Ross Stores, Inc. 936
37,300 Safeway, Inc. <F1> 1,317
7,500 School Specialty, Inc. <F1> 111
30,400 Wal-Mart Stores, Inc. 1,723
34,100 Walgreen Company<F1> 859
--------
15,536
--------
SCHOOLS 0.1%
5,200 Apollo Group, Inc. <F1> 137
--------
SECURITY SERVICES 0.1%
6,700 The Wackenhut Corporation - Class A 126
--------
SOFTWARE 2.1%
16,400 Aspen Technology, Inc.<F1> 203
29,100 Avant! Corporation<F1> 375
2,100 Business Objects S.A. - ADR<F1> 151
8,100 Citrix Systems, Inc. <F1> 519
3,300 Electronic Arts, Inc. <F1> 267
1,700 Mercury Interactive Corporation<F1> 138
26,500 Microsoft Corporation <F1> 2,453
5,300 NVIDIA Corporation<F1> 117
8,600 Rational Software Corporation<F1> 368
1,900 Usinternetworking,Inc. <F1> 64
3,000 VERITAS Software Corporation<F1> 324
--------
4,979
--------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
- --------- -------------
TELECOMMUNICATIONS 2.0%
44,900 Cincinnati Bell, Inc. $935
2,800 JDS Uniphase Corporation<F1> 467
6,800 McLeodUSA, Incorporated<F1> 303
25,624 MCI WorldCom, Inc. <F1> 2,199
11,800 PanAmSat Corporation<F1> 466
5,300 Viatel, Inc. <F1> 177
5,500 Williams Communications Group<F1> 175
--------
4,722
--------
TELECOMMUNICATIONS EQUIPMENT 2.5%
6,500 ADTRAN, Inc. <F1> 241
4,600 C-COR.net Corporation<F1> 181
1,100 Ditech Communications Corporation<F1> 97
3,600 General Motors Corporation - Class H 262
16,900 Lucent Technologies, Inc. 1,086
2,700 Motorola, Inc. 263
7,800 Nokia Corp. - ADR 901
19,700 Nortel Networks Corporation 1,220
1,100 QUALCOMM Incorporated<F1> 245
10,500 RF Micor Devices,Inc. <F1> 542
3,400 Siebel Systems, Inc. <F1> 373
7,800 Tellabs, Inc.<F1> 493
--------
5,904
--------
TELECOMMUNICATIONS SERVICES 0.1%
10,600 MGC Communications, Inc.<F1> 292
--------
TEXTILES & APPAREL 0.1%
11,600 Wolverine World Wide, Inc. 119
--------
TRANSPORTATION 0.9%
34,700 Harley-Davidson, Inc. 2,058
--------
TRAVEL & RECREATION 1.3%
38,000 Carnival Corporation 1,691
25,150 Royal Caribbean Cruises Ltd. 1,335
--------
3,026
--------
Total Common Stocks (Cost $109,884) 147,499
--------
Principal Amount Market Value
(in thousands) (in thousands)
- ------------- --------------
LONG-TERM INVESTMENTS 37.3%
ASSET-BACKED SECURITIES 3.7%
CREDIT CARD RECEIVABLES 3.4%
Chemical Master Credit Card Trust:
$2,300 Series 1995-2, Class A, 6.23%, 6/15/03 $2,295
500 Series 1996-1, Class A, 5.55%, 9/15/03 495
Citibank Credit Card Master Trust, Principal Only:
3,300 Series 1996-1, Class A, 0.00%, 2/07/03 3,040
200 Series 1997-6, Class A, 0.00%, 8/15/06 144
Household Affinity Credit Card Master Trust I,
500 Series 1993-2, Class A, 5.60%, 5/15/02 498
Sears Credit Account Master Trust:
1,125 Series 1994-1, Class A, 7.00%, 1/15/04 1,129
437 Series 1995-2, Class A, 8.10%, 6/15/04 442
--------
8,043
--------
HOME EQUITY LOAN RECEIVABLES 0.3%
Contimortgage Home Equity Loan Trust,
700 Series 1997-5, Class A5, 6.63%, 12/15/20 689
--------
CORPORATE BONDS 14.4%
ABN AMRO Bank Guarantee,
1,000 7.25%, 5/31/05 1,001
America West Airlines Pass-Thru Certificates:
450 8.54%, 1/02/06 (Acquired 9/14/99, Cost $450)<F1> 450
688 7.93%, 1/02/19 (Acquired 9/14/99, Cost $668)<F1> 669
Atlantic Richfield Co. Debentures,
300 8.50%, 4/01/12 332
BankAmerica Corporation Subordinated Notes,
350 7.75%, 7/15/02 359
BankBoston Corporation Subordinated Notes,
1,225 6.62%, 2/01/04 1,200
Bank One Corporation Notes,
300 6.875%, 8/01/06 295
Bankers Trust Corporation Subordinated Debentures,
1,775 8.125%, 5/15/02 1,819
Barclays American Corp. Debentures,
250 9.75%, 5/15/21 273
CIT Group, Inc. Senior Notes,
950 5.57%, 12/08/03 903
Commonwealth Edison Debentures,
900 9.875%, 6/15/20 1,007
Compass Bancshares, Inc. Subordinated Notes,
400 8.375%, 9/15/04 414
Continental Bank Subordinated Notes,
300 12.50%, 4/01/01 324
Continental Cablevision, Inc. Debentures:
350 8.875%, 9/15/05 377
900 9.50%, 8/01/13 999
Donaldson,Lufkin & Jenrette Senior Notes:
1,000 6.00%, 12/01/01 985
800 6.875%, 11/01/05 781
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
- ------------- --------------
CORPORATE BONDS 14.4% (CONT.)
Dresdner Bank New York Subordinated Debentures,
$800 7.25%, 9/15/15 $766
Duty Free International, Inc. Notes,
975 7.00%, 1/15/04 979
Dynegy, Inc. Senior Notes,
1,000 7.45%, 7/15/06 993
Federal Express Corporation Debentures,
250 9.625%, 10/15/19 259
Federal Express Corporation Notes,
500 9.65%, 6/15/12 584
First USA Bank Subordinated Notes,
975 6.625%, 5/15/03 974
General Motors Acceptance Corp. Medium Term Notes,
1,000 6.70%, 4/30/01 1,004
Georgia Pacific Corporation Debentures:
300 9.50%, 12/01/11 339
300 9.875%, 11/01/21 323
100 9.50%, 5/15/22 109
Goldman Sachs Group Notes,
1,500 6.25%, 2/01/03 (Acquired 2/01/96; Cost $1,496) <F2> 1,461
Keycorp Subordinated Notes,
730 8.00%, 7/01/04 753
Lehman Brothers Holdings, Inc. Notes:
350 6.65%, 11/08/99 350
200 8.75%, 5/15/02 208
500 7.80%, 7/07/05 502
500 8.50%, 8/01/15 523
Lehman Brothers, Inc. Debentures,
700 9.875%, 10/15/00 722
Marlin Water Trust Senior Notes,
677 7.09%, 12/15/01 (Acquired 12/9/98, Cost $680)<F2> 674
The May Department Stores Company Debentures,
300 9.875%, 6/15/21 326
Merrill Lynch & Co. Notes,
925 6.875%, 11/15/18 863
NCNB Corporation Subordinated Notes,
750 10.20%, 7/15/15 927
News America Holdings, Inc. Debentures,
300 10.125%, 10/15/12 329
Orion Capital Corporation Senior Notes,
1,000 7.25%, 7/15/05 959
PSI Energy, Inc. Debentures,
600 7.85%, 10/15/07 605
Paine Webber Group, Inc. Notes:
500 7.875%, 2/15/03 507
500 8.875%, 3/15/05 531
JC Penney Company, Inc. Debentures:
625 9.75%, 6/15/21 669
500 8.25%, 8/15/22 492
Rochester Telephone Debentures,
400 9.00%, 8/15/21 429
Principal Amount Market Value
(in thousands) (in thousands)
- ------------- -------------
CORPORATE BONDS 14.4% (CONT.)
Salomon, Inc. Senior Notes,
$575 6.75%, 2/15/03 $571
Salomon Smith Barney Holdings, Inc. Notes,
700 6.875%, 6/15/05 691
Tenneco, Inc. Debentures,
425 7.45%, 12/15/25 395
USF&G Corporation Senior Notes:
1,000 8.375%, 6/15/01 1,026
350 7.125%, 6/01/05 346
U.S. West Communications Group Debentures,
575 8.875%, 6/01/31 598
--------
33,975
--------
INTERNATIONAL/YANKEE (U.S. $ DENOMINATED) 3.4%
Banco Santander-Chile Notes,
475 6.560%, 11/01/05 454
Ford Capital BV Debentures,
325 9.875%, 5/15/02 348
Ford Capital BV Notes,
250 10.125%, 11/15/00 259
Hydro-Quebec Corporation Debentures:
350 11.75%, 2/01/12 469
500 9.75%, 1/15/18 537
Korea Development Bank Bonds,
585 7.125%, 9/17/01 580
Korea Electric Power Debentures:
290 7.75%, 4/01/13 264
200 6.75%, 8/01/27 187
Midland Bank PLC Subordinated Notes,
950 6.95%, 3/15/11 900
National Bank of Hungary Debentures,
250 8.875%, 11/01/13 270
Norsk Hydro A/S Debentures,
350 9.00%, 4/15/12 391
Pohang Iron & Steel Notes,
200 7.125%, 7/15/04 191
Principal Financial Group (Australia) Senior Notes,
1,400 8.20%, 8/15/09 (Acquired 8/18/99, Cost $1,396)<F2> 1,420
Quebec Province Debentures,
250 11.00%, 6/15/15 266
Sweden (Kingdom of) Debentures,
150 11.125%, 6/01/15 205
WestDeutsche Landesbank NY Subordinated Notes,
700 6.05%, 1/15/09 640
Wharf Capital International Ltd. Notes:
325 8.875%, 11/01/04 322
225 7.625%, 3/13/07 202
--------
7,905
--------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
- ------------- -------------
U.S. GOVERNMENT AGENCY-BACKED MORTGAGE ISSUES 0.8%
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC):
$298 Series 85, Class C, 8.60%, 1/15/21 $306
126 Series 1169, Class D, 7.00%, 5/15/21 126
380 Series 1136, Class H, 6.00%, 9/15/21 365
285 Series 1201, Class E, 7.40%, 12/15/21 287
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC):
298 Series 1989-37, Class G, 8.00%, 7/25/19 304
256 Series 1990-30, Class E, 6.50%, 3/25/20 250
265 Series 1990-105, Class J, 6.50%, 9/25/20 259
--------
1,897
--------
U.S. TREASURY OBLIGATIONS 15.0%
U.S. Treasury Bonds:
2,700 10.75%, 8/15/05 3,290
175 9.875%, 11/15/15 233
23,335 9.25%, 2/15/16 29,694
U.S. Treasury Strips, Principal Only,
2,600 0.00%, 11/15/04 1,912
--------
35,129
--------
Total Long-Term Investments (Cost $88,129) 87,638
--------
Number
of Shares
(in thousands)
- -------------
SHORT-TERM INVESTMENTS 1.2%
INVESTMENT COMPANIES 1.2%
38 Financial Square Prime Obligation Fund 38
2,752 Short-Term Investments Co. Liquid Assets Portfolio 2,752
--------
Total Investment Companies (Cost $2,790) 2,790
--------
Total Short-Term Investments (Cost $2,790) 2,790
--------
Total Investments (Cost $200,803) 101.2% 237,927
--------
Liabilities, less Other Assets (1.2)% (2,753)
--------
TOTAL NET ASSETS 100.0% $235,174
========
<F1>Non-income producing
<F2>Unregistered security
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
GROWTH AND INCOME FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
COMMON STOCKS 91.4%
BANKING 8.6%
357,400 Bank of New York $14,966
342,800 Mellon Bank Corporation 12,662
175,400 Northern Trust Corporation 16,937
382,300 Wells Fargo Company, Inc. 18,303
-----------
62,868
-----------
BUILDING MATERIALS 3.5%
227,000 Masco Corporation 6,924
74,800 Johnson Controls,Inc. 4,544
344,400 Vulcan Materials Company 14,228
-----------
25,696
-----------
BUSINESS MACHINES & SOFTWARE 0.9%
65,000 International Business Machines Corporation 6,394
-----------
BUSINESS SERVICES 3.1%
179,000 Automatic Data Processing, Inc. 8,626
209,600 Manpower, Inc. 7,362
257,700 Viad Corporation 6,330
-----------
22,318
-----------
CHEMICALS 2.0%
256,100 Ecolab, Inc. 8,659
153,800 Milpore Corporation 4,902
45,500 Valspar Corporation 1,373
-----------
14,934
-----------
COMMUNICATIONS & MEDIA 7.5%
146,000 CBS Corporation<F1> 7,127
460,700 Interpublic Group of Companies, Inc. 18,716
95,200 Knight-Ridder, Inc. 6,045
307,300 New York Times Company - Class A 12,367
119,800 Time Warner, Inc. 8,349
42,300 True North Communications, Inc. 1,706
-----------
54,310
-----------
CONSUMER PRODUCTS 1.4%
159,900 Avery Dennison Corporation 9,994
-----------
COSMETICS & SOAP 2.6%
199,800 Estee Lauder Companies - Class A 9,316
90,350 Procter & Gamble Company 9,475
-----------
18,791
-----------
Number Market Value
of Shares (in thousands)
----------- -------------
DRUGS & MEDICAL SUPPLY 11.7%
223,600 American Home Products Corporation $11,683
258,600 Bristol-Myers Squibb Company 19,864
153,600 Eli Lilly & Company 10,579
104,200 Johnson & Johnson 10,915
291,600 Medtronic, Inc. 10,097
89,400 Merck & Company, Inc. 7,113
162,200 Pfizer, Inc. 6,407
110,600 Warner-Lambert Company 8,827
-----------
85,485
-----------
ELECTRIC 2.0%
130,200 Duke Power Company 7,356
237,800 Illinova Corporation 7,565
-----------
14,921
-----------
ELECTRICAL EQUIPMENT 2.6%
60,400 General Electric Company 8,188
140,400 Intel Corporation 10,872
-----------
19,060
-----------
ELECTRONICS & SCIENTIFIC EQUIPMENT 1.8%
165,600 Molex, Inc. - Class A 5,465
82,000 Texas Instruments, Inc. 7,360
-----------
12,825
-----------
FINANCIAL SERVICES 4.8%
338,100 Alliance Capital Management L.P. 9,277
70,400 American Express Company 10,842
126,500 Household International, Inc. 5,645
118,500 Marsh & McLennan Companies, Inc. 9,369
-----------
35,133
-----------
FOOD, BEVERAGES & TOBACCO 4.3%
328,075 McCormick & Company, Inc. 10,293
432,700 PepsiCo, Inc. 15,009
156,600 Sysco Corporation 6,019
-----------
31,321
-----------
INSURANCE 3.0%
239,900 Hartford Life, Inc. - Class A 12,535
167,000 MBIA, Inc. 9,529
-----------
22,064
-----------
METALS & MINERALS 0.8%
191,400 USX Corporation - Marathon Group, Inc. 5,575
-----------
MULTI-INDUSTRY 4.3%
16,100 Illinois Tool Works Inc. 1,179
271,500 Pentair, Inc. 10,215
489,800 Tyco International, Ltd. 19,561
-----------
30,955
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
GROWTH AND INCOME FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
NATURAL GAS 2.0%
365,900 Enron Corporation $14,613
-----------
OIL - DOMESTIC 1.3%
205,700 Phillips Petroleum Company 9,565
-----------
OIL - INTERNATIONAL 1.6%
119,850 Mobil Corporation 11,566
-----------
OIL SERVICES 0.8%
91,100 Schlumberger, Ltd. 5,517
-----------
PAPER & FOREST PRODUCTS 2.5%
95,500 Consolidated Papers, Inc. 2,990
186,500 Kimberly-Clark Corporation 11,773
62,500 Weyerhaeuser Company 3,730
-----------
18,493
-----------
PRINTING & PUBLISHING 3.1%
125,700 Houghton Mifflin Company 5,327
286,200 McGraw-Hill, Inc. 17,065
-----------
22,392
-----------
REAL ESTATE INVESTMENT TRUSTS (REITS) 1.9%
194,300 AMB Property Corporation 3,862
132,700 Boston Properties, Inc. 3,956
156,800 Post Properties, Inc. 6,056
-----------
13,874
-----------
RETAIL 5.8%
102,200 Albertson's, Inc. 3,711
328,800 CVS Corporation 14,282
189,900 Gap, Inc. 7,050
153,500 Tandy Corporation 9,661
283,900 Walgreen Company 7,151
-----------
41,855
-----------
TELECOMMUNICATIONS 5.6%
354,300 ALLTEL Corporation 29,495
220,900 SBC Communications, Inc. 11,252
-----------
40,747
-----------
TELECOMMUNICATIONS EQUIPMENT 1.9%
112,092 Lucent Technologies, Inc. 7,202
104,300 Nortel Networks Corporation 6,460
-----------
13,662
-----------
Total Common Stock (Cost $462,590) 664,928
-----------
Number Market Value
of Shares (in thousands)
----------- -------------
PREFERRED STOCK 1.7%
NATURAL GAS 0.7%
238,300 Enron Corporation,
7.00%, 7/31/02
(convertible to EOG Resources,common stock) $5,124
FOOD, BEVERAGES & TOBACCO 1.0%
144,500 Seagram Company Ltd.,
7.50%, 6/21/02 (convertible to
Seagram Company Ltd. common stock) 7,144
-----------
Total Preferred Stock (Cost $12,545) 12,268
-----------
Number
of Shares
(in thousands)
- --------------
SHORT-TERM INVESTMENTS 5.4%
INVESTMENT COMPANIES 0.6%
10 Financial Square Prime Obligation Fund 10
4,022 Short-Term Investments Co. Liquid Assets Portfolio 4,022
-----------
Total Investment Companies (Cost $4,032) 4,032
-----------
Principal
Amounts
(in thousands)
- --------------
VARIABLE RATE DEMAND NOTES 4.8%
$10,000 American Family Financial Services, Inc. 10,000
15,000 General Mills, Inc. 15,000
10,000 Sara Lee Corporation 10,000
-----------
Total Variable Rate Demand Notes (Cost $35,000) 35,000
-----------
Total Short-Term Investments (Cost $39,032) 39,032
-----------
Total Investments (Cost $514,167) 98.5% 716,228
-----------
Other Assets, less Liabilities 1.5% 10,668
-----------
TOTAL NET ASSETS 100.0% $726,896
===========
<F1> Non-income producing
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
COMMON STOCKS 95.9%
AEROSPACE & AIRCRAFT 1.4%
34,200 Allied Signal, Inc. $1,947
60,326 Boeing Company 2,779
12,100 General Dynamics Corporation 671
24,468 Lockheed Martin Corporation 489
3,800 Northrop Grumman Corporation 209
20,800 Raytheon Company 606
11,800 Rockwell International Corporation 572
9,300 Textron, Inc. 718
29,900 United Technologies Corporation 1,809
-----------
9,800
-----------
AIR TRANSPORTATION 0.4%
10,700 AMR Corporation <F1> 679
8,400 Delta Air Lines, Inc. 457
17,700 FDX Corporation <F1> 762
29,925 Southwest Airlines Company 503
4,700 US Airways Group, Inc. <F1> 132
-----------
2,533
-----------
APPLIANCES 0.1%
2,200 Armstrong World Industries, Inc. 82
5,300 Black & Decker Corporation 228
5,300 Maytag Corporation 212
3,900 Snap-On Tools, Inc. 118
4,600 Whirlpool Corporation 321
-----------
961
-----------
AUTOS & TRUCKS 1.3%
8,300 Autozone, Inc.<F1> 220
10,038 Dana Corporation 297
33,638 Delphi Automotive Systems Corporation 553
4,500 Eaton Corporation 339
75,000 Ford Motor Company 4,116
40,200 General Motors Corporation 2,824
11,237 Genuine Parts Company 293
5,600 ITT Industries, Inc. 191
4,240 PACCAR, Inc. 200
7,200 TRW, Inc. 309
-----------
9,342
-----------
BANKING 7.7%
19,700 AMSouth Bancorp 507
73,194 Banc One Corporation 2,749
47,200 Bank of New York Company, Inc. 1,977
105,207 BankAmerica Corporation 6,773
18,700 BB&T Corporation 680
50,620 Chase Manhattan Corporation 4,423
206,502 Citigroup, Inc. 11,177
9,100 Comerica, Inc. 541
16,650 Fifth Third Bancorp 1,229
Number Market Value
of Shares (in thousands)
----------- -------------
BANKING 7.7% (CONT.)
58,228 First Union Corporation $2,486
59,737 Firstar Corporation 1,755
56,306 Fleet Boston Corporation 2,456
15,590 Huntington Bancshares Incorporated 462
11,000 J.P. Morgan & Co., Inc. 1,440
32,300 Mellon Bank Corporation 1,193
6,500 Northern Trust Corporation 628
18,800 PNC Bank Corporation 1,121
13,300 Regions Financial Corporation 400
6,600 Republic New York Corporation 417
10,000 SouthTrust Corporation 400
10,000 State Street Corporation 761
10,200 Summit Bancorp. 353
19,900 Sun Trust Banks, Inc. 1,456
16,100 Synovus Financial Corp. 345
45,055 US Bancorp 1,670
8,500 Union Planters Corp. 378
12,100 Wachovia Corporation 1,044
36,837 Washington Mutual, Inc. 1,324
102,330 Wells Fargo & Company 4,899
-----------
55,044
-----------
BIO-TECHNOLOGY 0.4%
31,700 Amgen, Inc. <F1> 2,528
-----------
BUILDING & HOUSING 0.2%
4,600 Fluor Corporation 183
27,100 Masco Corporation 827
6,100 The Stanley Works 169
-----------
1,179
-----------
BUILDING MATERIALS 0.1%
4,800 Johnson Controls, Inc. 292
2,900 Owens-Corning Corporation 59
5,900 Vulcan Materials Company 244
-----------
595
-----------
BUSINESS MACHINES & SOFTWARE 3.7%
9,500 Apple Computer, Inc. <F1> 761
105,309 COMPAQ Computer Corporation 2,001
7,800 Honeywell, Inc. 822
111,000 International Business Machines Corporation 10,920
8,100 Lexmark International Group, Inc.<F1> 632
89,118 Oracle Systems Corporation <F1> 4,239
16,600 Pitney-Bowes, Inc. 756
47,900 Sun Microsystems, Inc. <F1> 5,068
41,000 Xerox Corporation 1,148
-----------
26,347
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
BUSINESS SERVICES 3.5%
3,300 Autodesk, Inc. $62
38,300 Automatic Data Processing, Inc. 1,846
5,700 H & R Block, Inc. 243
14,000 BMC Software, Inc.<F1> 899
8,800 Ceridian Corporation <F1> 193
195,300 Cisco Systems, Inc. <F1> 14,452
33,187 Computer Associates International, Inc. 1,875
9,300 Computer Sciences Corporation <F1> 639
4,700 Deluxe Corporation 133
9,721 Dun & Bradstreet Corporation 286
30,500 Electronic Data Systems 1,784
9,000 Equifax Inc. 243
26,800 First Data Corporation 1,224
2,600 National Service Industries 84
14,600 Paychex, Inc.<F1> 575
15,100 Service Corporation International 144
16,100 Unisys Corporation<F1> 390
-----------
25,072
-----------
CHEMICALS 1.7%
13,700 Air Products and Chemicals, Inc. 377
13,600 Dow Chemical Company 1,608
70,799 Dupont (E.I.) De Nemours & Company 4,562
4,637 Eastman Chemical Company 179
7,900 Ecolab, Inc. 267
3,100 Great Lakes Chemical Corporation 110
6,000 Hercules, Inc. 144
2,600 Millipore Corporation 83
39,100 Monsanto Company 1,505
10,300 PPG Industries, Inc. 624
9,400 Praxair, Inc. 439
12,644 Rohm & Haas Company 484
10,100 Sherwin-Williams Company 226
6,300 Sigma-Aldrich Corporation 180
8,350 Union Carbide Corporation 509
26,800 The Williams Companies, Inc. 1,005
-----------
12,302
-----------
COMMUNICATIONS & MEDIA 3.9%
67,300 America Online, Inc.<F1> 8,728
4,350 Andrew Corporation <F1> 56
44,100 CBS Corporation<F1> 2,153
20,600 Clear Channel Communications, Inc. <F1> 1,656
45,900 Comcast Corporation - Class A 1,934
5,100 Dow Jones & Company, Inc. 314
17,300 Gannett Company, Inc. 1,334
4,300 Harcourt General, Inc. 166
16,300 Interpublic Group of Companies, Inc. 662
5,000 Knight-Ridder, Inc. 318
37,553 Mediaone Group, Inc. <F1> 2,669
10,800 New York Times Company - Class A 435
10,600 Omnicom Group, Inc. 933
Number Market Value
of Shares (in thousands)
----------- -------------
COMMUNICATIONS & MEDIA 3.9% (CONT.)
79,200 Time Warner, Inc. $5,519
4,323 Times Mirror Company - Class A 312
14,000 Tribune Company 840
-----------
28,029
-----------
COMPUTERS 1.8%
154,200 Dell Computer Corporation <F1> 6,187
62,700 EMC Corporation <F1> 4,577
18,600 Gateway, Inc.<F1> 1,229
4,400 Network Appliance, Inc.<F1> 326
13,900 Seagate Technology, Inc. <F1> 409
11,200 Silicon Graphics, Inc. <F1> 87
-----------
12,815
-----------
CONSUMER DURABLES 0.2%
19,950 Eastman Kodak Company 1,375
2,128 Polaroid Corporation 47
-----------
1,422
-----------
CONSUMER PRODUCTS 0.2%
7,200 Avery Dennison Corporation 450
18,800 Nabisco Group Holdings 241
17,500 Newell Rubbermaid, Inc. 606
3,200 Tupperware Corporation 63
-----------
1,360
-----------
CONTAINERS 0.1%
2,800 Bemis Company, Inc. 98
6,900 Crown Cork & Seal Company, Inc. 165
8,900 Owens-Illinois, Inc. <F1> 213
4,904 Sealed Air Corporation<F1> 272
-----------
748
-----------
COSMETICS & SOAP 2.1%
16,200 Avon Products, Inc. 522
14,000 Clorox Company 573
36,200 Colgate-Palmolive Company 2,190
68,688 Gillette Company 2,486
6,600 International Flavors & Fragrances, Inc. 252
82,300 Procter & Gamble Company 8,631
-----------
14,654
-----------
DISTRIBUTION 0.0%
9,358 Ikon Office Solutions, Inc. 64
-----------
DIVERSIFIED 0.4%
8,100 Danaher Corporation 391
35,410 Unilever N.V. 2,361
-----------
2,752
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
DRUGS 8.9%
91,200 Abbott Laboratories $3,803
4,000 Allergan, Inc. 430
6,000 Alza Corporation <F1> 257
81,100 American Home Products Corporation 4,237
3,100 Bard (C.R.), Inc. 167
18,100 Baxter International, Inc. 1,174
14,400 Becton, Dickinson & Company 365
121,140 Bristol-Meyers Squibb Company 9,305
16,850 Cardinal Health, Inc. 727
9,500 Humana, Inc. <F1> 65
81,900 Johnson & Johnson 8,579
66,200 Eli Lilly & Company 4,560
72,400 Medtronic, Inc. 2,507
142,300 Merck & Company, Inc. 11,322
236,900 Pfizer, Inc. 9,358
31,355 Pharmacia & Upjohn, Inc. 1,691
88,500 Schering-Plough 4,381
5,400 St. Jude Medical, Inc. <F1> 148
18,800 Tenet Healthcare Corporation <F1> 365
5,800 Watson Pharmaceuticals, Inc.<F1> 184
-----------
63,625
-----------
ELECTRIC 0.8%
11,800 AES Corp 666
7,700 Ameren Corporation 291
9,632 CINenergy Corporation 272
6,900 CMS Energy Corporation 254
13,700 Consolidated Edison Company of New York, Inc. 523
8,950 Constellation Energy Group 275
22,528 Duke Power Company 1,273
20,700 Edison International 613
6,700 Florida Progress Corporation 307
7,600 General Public Utilities Corporation 258
17,300 PacifiCorp 357
16,600 Texas Utilities Company 643
-----------
5,732
-----------
ELECTRICAL EQUIPMENT 4.2%
27,000 Emerson Electric Company 1,622
200,100 General Electric Company 27,126
5,600 Grainger (W.W.), Inc. 237
15,600 Solectron Corporation<F1> 1,174
-----------
30,159
-----------
ELECTRONICS 4.1%
11,600 Analog Devices, Inc.<F1> 616
4,200 Harris Corporation 94
61,500 Hewlett-Packard Company 4,555
201,400 Intel Corporation 15,596
37,300 Motorola, Inc. 3,634
10,000 National Semiconductor Corporation <F1> 299
Number Market Value
of Shares (in thousands)
----------- -------------
ELECTRONICS 4.1% (CONT.)
3,450 Tektronix, Inc. $116
48,600 Texas Instruments, Inc. 4,362
3,400 Thomas & Betts Corporation 153
-----------
29,425
-----------
ENERGY 1.3%
10,900 American Electric Power Company 376
9,000 Carolina Power & Light Company 311
12,700 Central & South West Corporation 282
12,650 Coastal Corporation 533
5,800 Consolidated Natural Gas Company 371
11,400 Dominion Resources, Inc. 549
8,900 DTE Energy Company 295
6,400 El Paso Energy Corporation 262
14,900 Entergy Corporation 446
14,100 FirstEnergy Corp. 367
11,700 FPL Group, Inc. 589
6,800 New Century Energies, Inc. 221
11,600 Niagara Mohawk Power Corporation <F1> 184
3,300 NICOR, Inc. 128
9,000 Northern States Power Company 194
23,800 Pacific Gas & Electric Company 546
13,100 Peco Energy Company 500
13,100 Public Service Enterprises Group, Inc. 518
17,672 Reliant Energy, Inc. 482
14,017 Sempra Energy 286
43,200 Southern Company 1,148
13,200 Unicom Corporation 506
-----------
9,094
-----------
ENERGY _ RAW MATERIALS 0.3%
19,990 Baker Hughes, Inc. 558
27,300 Halliburton Company 1,029
20,700 Occidental Petroleum Corporation 472
-----------
2,059
-----------
ENTERTAINMENT & LEISURE 1.1%
7,700 Brunswick Corporation 174
38,000 Carnival Corporation 1,691
12,188 Hasbro, Inc. 251
24,387 Mattel, Inc. 326
84,100 McDonald's Corporation 3,469
11,800 Mirage Resorts, Incorporated <F1> 172
42,770 Viacom, Inc. - Class B <F1> 1,914
8,050 Wendy's International, Inc. 192
-----------
8,189
-----------
ENVIRONMENTAL SERVICES 0.0%
22,100 Laidlaw, Inc. - Class B 135
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
FINANCE 1.3%
27,000 American Express Company $4,158
7,350 Bear Stearns Companies Inc. 313
29,706 Household International, Inc. 1,326
7,200 Lehman Brothers Holdings, Inc. 531
22,800 Merrill Lynch & Company, Inc. 1,790
38,200 National City Corporation 1,127
-----------
9,245
-----------
FINANCIAL SERVICES 2.3%
45,090 Associates First Capital Corporation - Class A 1,646
12,200 Capital One Financial Corporation 647
18,815 Conseco, Inc. 457
6,600 Countrywide Credit Industries, Inc. 224
63,500 Federal National Mortgage Association 4,493
15,000 Franklin Resources, Inc. 525
6,500 Kansas City Southern Industries 308
6,000 MBIA, Inc. 342
49,662 MBNA Corporation 1,372
35,366 Morgan Stanley Group, Inc. 3,901
8,700 Paine Webber, Inc. 355
9,700 SLM Holding Corporation 475
50,600 The Charles Schwab Corporation 1,970
-----------
16,715
-----------
FOOD, BEVERAGES & TOBACCO 4.2%
36,758 Archer-Daniels-Midland Company 453
16,800 Bestfoods 987
27,000 Campbell Soup Company 1,215
152,800 Coca-Cola Company 9,015
26,300 Coca-Cola Enterprises 672
30,250 ConAgra, Inc. 788
9,800 Dardeen Restaurants, Inc. 187
10,000 Fortune Brands, Inc. 354
9,000 General Mills, Inc. 785
22,300 Heinz (H.J.) Company 1,065
8,300 Hershey Foods Corporation 419
25,100 Kellogg Company 999
23,000 Lowe's Companies, Inc 1,265
91,500 PepsiCo, Inc. 3,174
149,400 Philip Morris Companies, Inc. 3,763
8,000 Quaker Oats Company 560
19,400 Ralston-Ralston Purina Group 610
56,000 Sara Lee Corporation 1,515
19,500 Sysco Corporation 750
9,120 Tricon Global Restaurants, Inc. <F1> 367
10,900 UST, Inc. 302
6,800 Wrigley (Wm) Jr. Company 544
-----------
29,789
-----------
Number Market Value
of Shares (in thousands)
----------- -------------
GOLD & PRECIOUS METALS 0.1%
23,200 Barrick Gold Corporation $425
9,600 Freeport McMoRan Copper & Gold, Inc. 160
15,500 Homestake Mining Company 130
19,361 Placer Dome, Inc. 235
-----------
950
-----------
HEALTH CARE SERVICES & SUPPLIES 1.1%
3,400 Bausch & Lomb, Inc. 184
24,500 Boston Scientific Corporation <F1> 493
33,828 Columbia/HCA Healthcare Corporation 816
25,700 HEALTHSOUTH Corporation <F1> 148
18,842 IMS Health, Inc. 546
6,300 Manor Care, Inc.<F1> 99
16,494 McKesson HBOC, Inc. 331
10,900 United Healthcare Corporation 563
52,700 Warner-Lambert Company 4,206
4,300 Wellpoint Health Networks, Inc.<F1> 249
-----------
7,635
-----------
HOSPITAL SUPPLIES & SERVICES 0.0%
6,500 Biomet, Inc. 196
-----------
INSURANCE 3.2%
8,394 Aetna Life and Casualty Company 422
15,900 AFLAC Corporation, Inc. 813
49,946 Allstate Corporation 1,436
15,500 American General Corporation 1,150
95,902 American International Group, Inc. 9,872
15,000 Aon Corporation 532
9,600 Chubb Corporation 527
12,600 CIGNA Corporation 942
10,200 Cincinnati Financial Corporation 365
13,700 The Hartford Financial Services Group, Inc. 710
6,225 Jefferson-Pilot Corporation 467
26,704 KeyCorp 746
11,800 Lincoln National Corporation 544
16,260 Marsh & McLennan Companies, Inc. 1,286
6,400 MGIC Investment Corporation 382
4,300 Progressive Corporation 398
8,800 Providian Corporation 959
8,100 SAFECO Corporation 223
14,332 St. Paul Companies, Inc. 459
7,900 Torchmark Corporation 246
14,259 UNUM Provident Corporation 470
-----------
22,949
-----------
LIQUOR 0.5%
29,500 Anheuser-Busch Companies, Inc. 2,118
4,200 Brown-Foreman Corporation - Class B 283
26,500 Seagram Company Ltd. 1,308
-----------
3,709
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
MACHINERY - AGRICULTURE & AUTOMOTIVE 0.0%
4,400 Case Equipment $233
-----------
MACHINERY - INDUSTRIAL 0.0%
9,500 Thermo Electron Corporation <F1> 128
-----------
MEDICAL INSTRUMENTS 0.2%
18,700 Guidant Corporation 923
6,000 PE Corp-PE Biosystems Group 389
-----------
1,312
-----------
METALS & MINERALS 0.2%
12,160 Allegheny Teledyne, Inc. 185
5,200 Nucor Corporation 270
18,366 USX Corporation-Marathon Group, Inc. 535
4,793 USX Corporation-US Steel Group, Inc. 123
-----------
1,113
-----------
MISCELLANEOUS 0.8%
23,100 Applied Materials, Inc. <F1> 2,075
4,100 Mallinckrodt Group, Inc. 139
9,400 PP&L Resources, Inc. 254
21,000 3 Com Corporation <F1> 609
24,900 3M Corporation 2,367
-----------
5,444
-----------
MULTI-INDUSTRY 0.9%
46,141 Cendant Corporation<F1> 761
15,100 Corning, Inc. 1,187
6,500 Loews Corporation 461
9,624 Tenneco, Inc. 154
101,696 Tyco International, Ltd. 4,061
-----------
6,624
-----------
NATURAL GAS 0.2%
43,800 Enron Corporation 1,749
-----------
NON-FERROUS METALS 0.4%
13,250 Alcan Aluminum Ltd. 436
22,900 Alcoa, Inc. 1,391
8,800 Englehard Corporation 155
11,400 Inco, Ltd. 231
9,436 Newmont Mining Corporation 207
3,300 Phelps Dodge Corporation 186
3,500 Reynolds Metals Company 212
-----------
2,818
-----------
OFFICE EQUIPMENT 0.1%
21,500 Novell, Inc. <F1> 431
-----------
OIL - DOMESTIC 0.7%
5,600 Amerada Hess Corporation 321
7,300 Anadarko Petroleum Corporation 225
4,600 Ashland, Inc. 152
Number Market Value
of Shares (in thousands)
----------- -------------
OIL - DOMESTIC 0.7% (CONT.)
19,900 Atlantic Richfield Company $1,854
10,592 Burlington Resources, Inc. 369
9,650 Columbia Gas System, Inc. 627
5,208 Kerr-McGee Corporation 280
14,900 Phillips Petroleum Company 693
5,700 Sun Company, Inc. 138
14,200 Unocal Corporation 490
-----------
5,149
-----------
OIL - INTERNATIONAL 4.3%
7,400 Apache Corporation 289
40,600 Chevron Corporation 3,707
38,400 Conoco, Inc. 1,042
148,400 Exxon Corporation 10,991
48,500 Mobil Corporation 4,680
132,800 Royal Dutch Petroleum Company 7,960
33,200 Texaco, Inc. 2,038
-----------
30,707
-----------
OIL & GAS SERVICES 0.3%
3,700 McDermott International, Inc. 67
33,900 Schlumberger, Ltd. 2,053
15,338 Union Pacific Resources Group 222
-----------
2,342
-----------
PAPER & FOREST PRODUCTS 0.9%
3,400 Boise Cascade Corporation 121
5,500 Champion International Corporation 318
13,400 Fort James Corporation 353
10,200 Georgia-Pacific Corporation 405
25,415 International Paper Company 1,337
33,012 Kimberly-Clark Corporation 2,084
6,372 Louisiana Pacific Corporation 81
6,200 Mead Corporation 223
3,250 Temple-Inland, Inc. 189
6,825 Westvaco Corporation 203
12,450 Weyerhaeuser Company 743
6,600 Willamette Industries 274
-----------
6,331
-----------
PRINTING & PUBLISHING 0.1%
11,500 McGraw-Hill, Inc. 686
7,300 R.R. Donnelley & Sons Company 177
-----------
863
-----------
PRODUCTION 0.7%
22,000 Caterpillar, Inc. 1,215
5,600 Cooper Industries, Inc. 241
14,000 Deere & Company 507
13,600 Dover Corporation 579
1,900 FMC Corporation <F1> 77
15,500 Illinois Tool Works, Inc. 1,135
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
PRODUCTION 0.7% (CONT.)
10,300 Ingersoll-Rand Company $538
6,366 Pall Corporation 140
6,525 Parker-Hannifin Corporation 299
4,900 Timken Company 88
-----------
4,819
-----------
RAILROADS 0.4%
27,943 Burlington Northern Santa Fe 891
12,720 CSX Corporation 522
22,200 Norfolk Southern Corporation 542
15,300 Union Pacific Corporation 853
-----------
2,808
-----------
RETAIL 5.7%
26,043 Albertson's, Inc. 946
4,400 American Greetings Corporation 114
7,400 Bed Bath & Beyond, Inc.<F1> 247
12,700 Best Buy, Inc.<F1> 706
12,000 Circuit City Stores, Inc. 512
6,000 Consolidated Stores Corporation<F1> 110
13,621 Costco Companies, Inc.<F1> 1,094
27,400 Dayton Hudson Corporation 1,771
6,600 Dillard Department Stores, Inc. - Class A 125
13,281 Dollar General Corporation 350
12,300 Federated Department Stores<F1> 525
53,275 Gap, Inc. 1,978
91,800 Home Depot, Inc. 6,931
28,500 Kmart Corporation <F1> 287
9,700 Kohl's Department Stores<F1> 726
51,200 Kroger Corporation <F1> 1,066
13,311 The Limited, Inc. 547
20,514 The May Department Stores Company <F1> 712
1,296 The Neiman-Marcus Group, Inc.<F1> 28
8,400 Nordstrom, Inc. 209
23,400 Office Depot, Inc.<F1> 291
15,700 JC Penney Company, Inc. 398
3,300 Pep Boys-Manny, Moe & Jack 41
15,400 Rite Aid Corporation 135
30,800 Safeway, Inc.<F1> 1,088
23,600 Sears Roebuck and Company 665
28,750 Staples, Inc. <F1> 638
7,000 Supervalu, Inc. 147
11,400 Tandy Corporation 717
19,000 TJX Companies, Inc. 515
17,025 Toys 'R' Us, Inc. <F1> 240
62,000 Walgreen Company 1,562
272,100 Wal-Mart Stores, Inc. 15,425
8,800 Winn-Dixie Stores, Inc. 238
-----------
41,084
-----------
Number Market Value
of Shares (in thousands)
----------- -------------
SAVINGS & LOAN 0.4%
43,100 Federal Home Loan Mortgage Corporation $ 2,330
3,400 Golden West Financial Corporation 380
-----------
2,710
-----------
SEMICONDUCTORS 0.3%
7,500 Advanced Micro Devices, Inc. <F1> 149
5,200 KLA-Tencor Corporation <F1> 412
8,300 LSI Logic Corp. <F1> 441
14,900 Micron Technology Incorporated 1,063
-----------
2,065
-----------
SOFTWARE 4.3%
7,200 Adobe Systems Incorporated 503
22,800 Compuware Corporation <F1> 634
311,000 Microsoft Corporation <F1> 28,787
16,200 Parametric Technology Company <F1> 309
14,400 Peoplesoft, Inc. <F1> 216
-----------
30,449
-----------
TELECOMMUNICATIONS 10.0%
8,200 ADC Telecommunications, Inc.<F1> 391
18,900 Alltell Corporation 1,573
194,542 AT&T Corporation 9,095
94,308 Bell Atlantic Corporation 6,124
115,200 BellSouth Corp. 5,184
10,300 Cabletron Systems <F1> 171
8,300 CenturyTel, Inc. 336
44,820 Global Crossing Ltd.<F1> 1,552
60,200 GTE Corporation 4,515
185,879 Lucent Technologies, Inc. 11,943
113,780 MCI Worldcom, Inc.<F1> 9,764
20,400 Nextel Communications, Inc.<F1> 1,758
208,408 SBC Communications, Inc. 10,616
4,500 Scientific-Atlanta, Inc. 258
53,600 Sprint Corporation 3,983
27,250 Sprint PCS Group 2,260
31,145 US West, Inc. 1,902
-----------
71,425
-----------
TELECOMMUNICATIONS EQUIPMENT 1.3%
10,700 General Instrument Corporation<F1> 576
82,160 Nortel Networks Corporation 5,089
9,600 Qualcom, Inc.<F1> 2,138
24,300 Tellabs, Inc. <F1> 1,537
-----------
9,340
-----------
TEXTILES & APPAREL 0.3%
24,200 CVS Corporation 1,051
3,600 Liz Claiborne, Inc. 144
17,400 Nike, Inc. - Class B 982
7,454 VF Corporation 224
-----------
2,401
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
TIRE & RUBBER 0.1%
4,800 Cooper Tire & Rubber Company $81
6,800 Goodrich (B.F.) Company 161
9,262 Goodyear Tire & Rubber Company 383
-----------
625
-----------
TRANSPORTATION EQUIPMENT 0.0%
2,500 Cummins Engine Company, Inc. 127
-----------
TRAVEL & RECREATION 0.6%
127,500 The Walt Disney Company 3,363
7,150 Harrahs Entertainment, Inc. <F1> 207
14,700 Hilton Hotels Corporation 136
14,900 Marriott International, Inc. - Class A 502
-----------
4,208
-----------
TRUCKING 0.0%
3,550 Ryder System, Inc. 76
-----------
WASTE MANAGEMENT 0.1%
37,740 Waste Management, Inc. 693
-----------
Total Common Stock (Cost $342,151) 685,227
-----------
Principal
Amount
(in thousands)
- --------------
SHORT-TERM INVESTMENTS 4.6%
U.S. TREASURIES 0.5%
$ 3,600 U.S. Treasury Bill, 4.61%, 12/16/99 3,579
-----------
Total U.S. Treasuries (Cost $3,579) 3,579
-----------
VARIABLE RATE DEMAND NOTES 4.1%
12,684 American Family Financial Services, Inc. 12,684
10,600 General Mills, Inc. 10,600
6,229 Sara Lee Corporation 6,229
-----------
Total Variable Rate Demand Notes (Cost $29,513) 29,513
-----------
Total Short-Term Investments (Cost $33,092) 33,092
-----------
Total Investments (Cost $375,243) 100.5% 718,319
-----------
Liabilities, less Other Assets (0.5)% (3,298)
-----------
TOTAL NET ASSETS 100.0% $715,021
===========
<F1> Non-income producing
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
COMMON STOCKS 92.2%
AEROSPACE & AIRCRAFT 0.6%
38,500 General Dynamics Corporation $2,134
-----------
AIR TRANSPORTATION 0.2%
48,800 Southwest Airlines 820
-----------
BANKING 4.1%
58,300 Fifth Third Bancorp 4,303
131,800 State Street Corporation 10,033
-----------
14,336
-----------
BUSINESS SERVICES 8.9%
44,200 Ceridian Corporation<F1> 970
116,400 Cintas Group 7,013
45,200 Computer Sciences Corporation<F1> 3,105
167,500 First Data Corporation 7,653
13,500 Pittston Brink's Group 259
77,100 Sabre Group Holdings, Inc. <F1> 3,426
371,300 SunGard Data Systems, Inc. <F1> 9,074
-----------
31,500
-----------
COMMUNICATIONS & MEDIA 6.8%
42,000 Clear Channel Communications, Inc. <F1> 3,376
95,500 Infinity Broadcasting 3,301
176,400 Interpublic Group of Companies, Inc. 7,166
89,700 Omnicom Group, Inc. 7,894
95,300 Walt Disney Company 2,514
-----------
24,251
-----------
COMPUTERS 3.4%
53,000 Dell Computer Corporation <F1> 2,127
73,300 EMC Corporation <F1> 5,351
43,000 Sun Microsystems, Inc. 4,550
-----------
12,028
-----------
DRUGS 6.0%
99,900 Eli Lilly & Company 6,881
58,000 Merck & Co., Inc. 4,615
99,500 Schering Plough Corporation 4,925
59,100 Warner-Lambert Company 4,717
5,000 Watson Pharmaceuticals, Inc.<F1> 159
-----------
21,297
-----------
Number Market Value
of Shares (in thousands)
----------- -------------
ELECTRONIC COMPONENTS & SEMICONDUCTORS 6.1%
18,600 Applied Materials, Inc.<F1> $1,670
97,900 Intel Corporation 7,581
133,270 Molex, Inc. - Class A 4,398
14,500 PMC - Sierra, Inc.<F1> 1,367
73,200 Texas Instruments Incorporated 6,570
-----------
21,586
-----------
FINANCIAL SERVICES 6.1%
99,800 Associates First Capital Corporation 3,643
26,600 Federal National Mortgage Association 1,882
87,900 Franklin Resources, Inc. 3,076
297,775 MBNA Corporation 8,226
44,700 Morgan Stanley Dean Witter & Company 4,931
-----------
21,758
-----------
HEALTH CARE SERVICES & SUPPLIES 2.8%
105,550 Cardinal Health, Inc. 4,552
189,400 IMS Health Incorporated 5,493
-----------
10,045
-----------
INSURANCE 6.3%
34,750 AFLAC, Inc. 1,776
98,782 American International Group 10,168
68,800 Hartford Life, Inc. - Class A 3,595
112,200 MGIC Investment Corporation 6,704
-----------
22,243
-----------
INTERNET PRODUCTS & SERVICES 0.5%
13,500 America Online, Inc.<F1> 1,751
-----------
MEDICAL INSTRUMENTS 4.8%
117,400 Guidant Corporation 5,797
204,200 Medtronic, Inc. 7,070
65,300 Stryker Corporation 4,032
-----------
16,899
-----------
MULTI-INDUSTRY 2.8%
244,600 Tyco International, Ltd. 9,769
-----------
NETWORKING PRODUCTS 1.9%
90,900 Cisco Systems, Inc.<F1> 6,727
-----------
OIL & GAS - DOMESTIC 0.9%
150,100 EOG Resources,Inc. 3,124
-----------
OIL & GAS SERVICES 3.0%
200,700 Enron Corporation<F1> 8,015
44,600 Schlumberger Limited 2,701
-----------
10,716
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
RETAIL 11.4%
35,600 Costco Companies, Inc. <F1> $2,859
57,300 Dayton Hudson Corporation 3,703
44,200 Home Depot, Inc. 3,337
52,000 Kohl's Corporation <F1> 3,890
139,400 Kroger Company <F1> 2,901
130,900 Lowe's Companies, Inc. 7,199
153,500 Safeway, Inc. <F1> 5,420
145,100 Walgreen Company 3,655
130,300 Wal-Mart Stores, Inc. 7,386
-----------
40,350
-----------
SOFTWARE 2.8%
108,500 Microsoft Corporation<F1> 10,043
-----------
TELECOMMUNICATIONS 4.0%
137,800 Cincinnati Bell, Inc. 2,868
11,100 JDS Uniphase Corporation<F1> 1,852
110,848 MCI WorldCom, Inc.<F1> 9,512
-----------
14,232
-----------
TELECOMMUNICATIONS EQUIPMENT 5.0%
70,600 Lucent Technologies, Inc. 4,536
11,400 Motorola, Inc. 1,111
31,400 Nokia Corporation - ADR 3,629
89,700 Nortel Networks Corporation 5,556
4,400 Qualcom, Inc. 980
32,700 Tellabs, Inc.<F1> 2,068
-----------
17,880
-----------
TRANSPORTATION 1.7%
104,500 Harley-Davidson, Inc. 6,198
-----------
TRAVEL & RECREATION 2.1%
167,800 Carnival Corporation - Class A 7,467
-----------
Total Common Stock (Cost $233,333) 327,154
-----------
Number
of Shares
(in thousands)
- --------------
SHORT-TERM INVESTMENTS 7.4%
INVESTMENT COMPANIES 1.5%
56 Financial Square Prime Obligation Fund 56
5,266 Short-Term Investments Co. Liquid Assets Portfolio 5,266
-----------
Total Investment Companies (Cost $5,322) 5,322
-----------
Principle Amount Market Value
(in thousands) (in thousands)
- -------------- -------------
VARIABLE RATE DEMAND NOTES 5.9%
$15,000 Sara Lee Corporation $15,000
3,000 Warner-Lambert Company 3,000
3,000 General Mills, Inc. 3,000
-----------
Total Variable Rate Demand Notes (Cost $21,000) 21,000
-----------
Total Short-Term Investments (Cost $26,322) 26,322
-----------
Total Investments (Cost $259,655) 99.6% 353,476
-----------
Other Assets, less Liabilities 0.4% 1,316
-----------
TOTAL NET ASSETS 100.0% $354,792
===========
<F1> Non-income producing
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
SPECIAL GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
COMMON STOCKS 94.0%
AEROSPACE & AIRCRAFT 0.5%
152,300 Orbital Sciences Corporation<F1> $2,246
-----------
BANKING 4.7%
117,300 Charter One Financial, Inc. 2,881
38,200 First Tennessee National Corporation 1,299
90,115 Marshall & Ilsley Corporation 6,049
112,600 North Fork Bancorporation, Inc. 2,329
56,600 Old Kent Financial Corporation 2,306
78,600 TCF Financial Corporation 2,319
73,800 Zions Bancorporation 4,350
-----------
21,533
-----------
BUILDING MATERIALS & CONSTRUCTION 0.5%
46,180 Southdown, Inc. 2,231
-----------
BUSINESS SERVICES 7.4%
79,100 Cintas Group<F1> 4,766
385,432 Concord EFS, Inc. <F1> 10,431
395,100 NOVA Corporation <F1> 10,271
72,600 Sungard Data Systems, Inc. <F1> 1,774
63,600 Sykes Enterprises, Inc.<F1> 1,964
175,200 Viad Corp. 4,303
-----------
33,509
-----------
COMMUNICATIONS & MEDIA 2.5%
82,100 AMFM, Inc.<F1> 5,747
108,300 True North Communications, Inc.<F1> 4,366
26,050 Valassis Communications<F1> 1,120
-----------
11,233
-----------
ELECTRONIC COMPONENTS & SEMICONDUCTORS 18.3%
103,300 Altera Corporation<F1> 5,023
173,300 Analog Devices, Inc.<F1> 9,207
128,100 Atmel Corporation<F1> 4,948
40,500 Celestica, Inc.<F1> 2,253
44,000 Conexant Systems, Inc.<F1> 4,109
103,600 Cypress Semiconductor Corporation<F1> 2,648
59,400 KLA-Tencor Corporation<F1> 4,704
37,600 Linear Technology Corporation 2,630
54,000 LSI Logic Corporation<F1> 2,872
81,625 Maxim Integrated Products<F1> 6,443
105,500 Molex, Inc. - Class A 3,482
35,800 Novellus Systems, Inc.<F1> 2,775
53,900 Sanmina Corporation<F1> 4,854
28,700 SDL, Inc.<F1> 3,539
234,700 Teradyne,Inc.<F1> 9,036
67,600 Vitesse Semiconductor Corporation<F1> 3,101
149,300 Xilinx, Inc.<F1> 11,739
-----------
83,363
-----------
Number Market Value
of Shares (in thousands)
----------- -------------
ENERGY 1.5%
86,900 El Paso Energy Corporation $3,555
99,600 Illinova Corporation 3,169
-----------
6,724
-----------
FINANCIAL SERVICES 4.4%
75,500 The BISYS Group, Inc.<F1> 3,850
396,722 Fiserv, Inc.<F1> 12,695
86,350 The Charles Schwab Corporation 3,362
-----------
19,907
-----------
FOOD - DISTRIBUTION 2.0%
199,700 SUPERVALU, Inc. 4,195
266,675 U.S. Foodservice<F1> 5,117
-----------
9,312
-----------
HEALTH CARE SERVICES & SUPPLIES 3.2%
1,110,259 Health Management Associates, Inc. - Class A <F1> 9,854
169,285 Lincare Holdings, Inc. <F1> 4,761
-----------
14,615
-----------
HOUSING 0.5%
126,295 Toll Brothers, Inc. <F1> 2,210
-----------
INSURANCE 14.2%
264,375 Ambac Financial Group, Inc. 15,796
13,300 Hartford Life, Inc. - Class A 695
256,500 MGIC Investment Corporation 15,326
65,000 Nationwide Financial Services, Inc. 2,462
83,550 The PMI Group, Inc. 4,334
723,180 Protective Life Corporation 26,170
-----------
64,783
-----------
MEDICAL INSTRUMENTS 3.0%
274,600 Biomet, Inc. 8,272
56,500 Stryker Corporation 3,489
33,200 VISX, Inc.<F1> 2,077
-----------
13,838
-----------
MULTI-INDUSTRY 0.4%
52,400 Pentair, Inc. <F1> 1,971
-----------
OIL & GAS - DOMESTIC 3.1%
119,400 Burlington Resources, Inc. 4,164
27,900 Devon Energy Corporation 1,085
418,400 EOG Resources, Inc. 8,708
-----------
13,957
-----------
OIL & GAS SERVICES 0.7%
100,200 Nabors Industries, Inc.<F1> 2,273
78,430 Petroleum Geo-Services ASA - ADR<F1> 1,147
-----------
3,420
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
SPECIAL GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
PAPER & RELATED PRODUCTS 0.3%
49,500 Consolidated Papers, Inc. $1,550
-----------
PRINTING & PUBLISHING 0.5%
44,500 Scholastic Corporation<F1> 2,069
-----------
RESTAURANTS 0.6%
98,600 Starbucks Corporation <F1> 2,681
-----------
RETAIL 9.3%
310,480 BJ's Wholesale Club, Inc. <F1> 9,567
440,463 Dollar General Corporation 11,617
615,395 Family Dollar Stores<F1> 12,692
418,690 Ross Stores, Inc. 8,635
-----------
42,511
-----------
SCHOOLS 0.6%
108,360 Apollo Group, Inc. <F1> 2,851
-----------
SOFTWARE 5.7%
79,800 Citrix Systems, Inc. <F1> 5,117
31,015 Electronic Arts, Inc. <F1> 2,506
83,300 Rational Software Corporation<F1> 3,561
31,900 Siebel Systems, Inc.<F1> 3,503
125,590 Synopsys, Inc. <F1> 7,826
18,500 USinternetworking, Inc. 621
26,800 VERITAS Software Corporation<F1> 2,891
-----------
26,025
-----------
TELECOMMUNICATIONS 1.4%
100,700 Cincinnati Bell, Inc.<F1> 2,096
62,400 McLeodUSA, Incorporated<F1> 2,785
50,900 Williams Communications Group, Inc.<F1> 1,622
-----------
6,503
-----------
TELECOMMUNICATIONS EQUIPMENT 4.8%
72,150 Comverse Technology<F1> 8,189
34,000 General Motors Corporation - Class H 2,476
104,100 PanAmSat Corporation<F1> 4,112
99,100 RF Micro Devices,Inc.<F1> 5,116
45,200 TranSwitch Corporation<F1> 2,127
-----------
22,020
-----------
TRANSPORTATION 1.1%
81,300 Harley-Davidson, Inc. 4,822
-----------
TRAVEL & RECREATION 2.8%
237,960 Royal Caribbean Cruises Ltd. 12,627
-----------
Total Common Stock (Cost $315,911) 428,511
-----------
Number Market Value
of Shares (in thousands)
----------- -------------
SHORT-TERM INVESTMENTS 8.5%
INVESTMENT COMPANIES 3.8%
21 Financial Square Prime Obligation Fund $21
17,233 Short-Term Investments Co. Liquid Assets Portfolio 17,233
-----------
Total Investment Companies (Cost $17,254) 17,254
-----------
Principal
Amount
(in thousands)
- --------------
VARIABLE RATE DEMAND NOTES 4.7%
$21,500 Sara Lee Corporation 21,500
-----------
Total Variable Rate Demand Notes (Cost $21,500) 21,500
-----------
Total Short-Term Investments (Cost $38,754) 38,754
-----------
Total Investments (Cost $354,665) 102.5% 467,265
-----------
Liabilities, less Other Assets (2.5)% (11,434)
-----------
TOTAL NET ASSETS 100.0% $455,831
===========
<F1> Non-income producing
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
COMMON STOCKS 91.7%
AUTO - RENTALS 1.0%
79,800 Avis Rent A Car, Inc.<F1> $1,426
-----------
BATTERIES 1.1%
66,600 Rayovac Corporation<F1> 1,657
-----------
BUILDING & CONSTRUCTION 2.1%
9,200 Dycom Industries, Inc.<F1> 300
44,900 Granite Construction, Inc.<F1> 929
39,000 Texas Industries, Inc. 1,397
49,900 U.S. Aggregates, Inc.<F1> 596
-----------
3,222
-----------
BUSINESS MACHINES &SOFTWARE 2.1%
82,030 Affiliated Computer Services, Inc.<F1> 3,117
-----------
BUSINESS SERVICES 9.6%
114,635 F.Y.I. Incorporated <F1> 3,783
44,700 Lason, Inc. <F1> 1,661
30,000 NCO Group, Inc.<F1> 1,271
72,235 Steiner Leisure Ltd<F1> 1,384
204,150 Sykes Enterprises, Inc.<F1> 6,303
-----------
14,402
-----------
COMMUNICATIONS & MEDIA 3.2%
27,900 CD Radio, Inc.<F1> 711
21,300 Citadel Communications Corporation<F1> 1,029
2,400 Cumulus Media, Inc.<F1> 119
20,900 Spanish Broadcasting Systems<F1> 556
57,400 True North Communications<F1> 2,314
-----------
4,729
-----------
COMPUTERS 3.0%
72,120 CDW Computer Centers, Inc. <F1> 4,453
-----------
DATA PROCESSING 6.8%
297,291 Acxiom Corporation <F1> 4,905
56,600 National Computer Systems, Inc. 2,140
60,175 National Data Corporation 1,444
144,000 The Source Information Management Company<F1> 1,728
-----------
10,217
-----------
DRUGS 1.6%
27,800 Alpharma, Inc. Class A 977
46,000 Shire Pharmaceuticals Group PLC - ADR<F1> 1,460
-----------
2,437
-----------
Number Market Value
of Shares (in thousands)
----------- -------------
ELECTRICAL COMPONENTS AND SEMICONDUCTORS 13.9%
73,800 ATMI, Inc.<F1> $1,988
38,000 Burr-Brown Corporation<F1> 1,494
51,100 Credence Systems Corporation<F1> 2,331
46,600 CTS Corporation 2,636
35,200 Etec Systems, Inc.<F1> 1,344
40,500 Kent Electronics Corporation<F1> 787
33,700 Kulicke and Soffa Industries, Inc.<F1> 992
30,600 Micrel,Inc.<F1> 1,664
34,200 Novellus Systems, Inc.<F1> 2,650
31,600 NVIDIA Corporation<F1> 699
32,600 Photronics, Inc.<F1> 683
33,600 Power-One, Inc.<F1> 672
35,300 TriQuint Semiconductor, Inc. <F1> 2,824
-----------
20,764
-----------
ENTERTAINMENT & LEISURE 1.5%
179,735 American Skiing Company<F1> 843
40,430 Cinar Corporation<F1> 702
35,700 Imax Corporation<F1> 741
-----------
2,286
-----------
FINANCIAL SERVICES 4.6%
122,515 The BISYS Group, Inc.<F1> 6,248
40,100 Federated Investors, Inc. 692
-----------
6,940
-----------
HEALTH CARE SERVICES & SUPPLIES 0.5%
13,500 Express Scripts, Inc. <F1> 663
-----------
INSURANCE 7.7%
63,845 Financial Security Assurance Holdings Ltd. 3,599
57,730 Arthur J. Gallagher & Co. 2,987
94,099 Radian Group, Inc. 4,970
-----------
11,556
-----------
INTERNET PRODUCTS & SERVICES 0.7%
40,900 Concentric Network Corporation<F1> 1,048
-----------
MEDICAL INSTRUMENTS 0.4%
43,000 LaserSight, Incorporated<F1> 594
-----------
NETWORKING PRODUCTS 3.4%
59,100 Ancor Communications, Inc.<F1> 1,873
15,400 Computer Network Technology Corporation<F1> 247
8,800 Emulex Corporation<F1> 1,372
22,700 MMC Networks, Inc.<F1> 724
7,600 QLogic Corporation<F1> 791
-----------
5,007
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
OIL & GAS - DOMESTIC 3.4%
251,075 Forest Oil Corporation<F1> $3,358
37,300 Newfield Exploration Company<F1> 1,098
26,600 St. Mary Land & Exploration Company 678
-----------
5,134
-----------
OIL & GAS SERVICES 0.9%
174,715 Seitel, Inc. <F1> 1,387
-----------
POLLUTION CONTROL 0.8%
72,693 Tetra Technologies, Inc.<F1> 1,154
-----------
RESTAURANTS 0.9%
56,000 Brinker International, Inc.<F1> 1,304
-----------
RETAIL 8.0%
44,800 Ames Department Stores<F1> 1,420
394,427 Goody's Family Clothing, Inc. <F1> 3,994
163,640 The Men's Wearhouse, Inc. <F1> 3,590
128,440 Pier 1 Imports<F1> 763
31,985 Regis Corporation<F1> 594
46,900 School Specialty, Inc.<F1> 695
82,700 Wolverine World Wide, Inc. 848
-----------
11,904
-----------
SECURITY SERVICES 0.5%
41,305 The Wackenhut Corporation<F1> 777
-----------
SOFTWARE 5.8%
100,200 Aspen Technology, Inc.<F1> 1,240
184,355 Avant! Corporation<F1> 2,374
12,800 Business Objects S.A. - ADR<F1> 922
10,800 Mercury Interactive Corporation<F1> 876
145,300 Sterling Software, Inc.<F1> 3,188
-----------
8,600
-----------
TELECOMMUNICATIONS EQUIPMENT 5.7%
61,600 ADTRAN, Inc.<F1> 2,287
26,400 Alpha Industries, Inc.<F1> 1,459
35,000 Black Box Corporation<F1> 1,776
34,400 C-Cor.Net Corporation<F1> 1,350
7,100 Ditech Communications Corporation<F1> 624
21,600 TransSwitch Corporation<F1> 1,017
-----------
8,513
-----------
TELECOMMUNICATIONS SERVICES 2.5%
67,300 MGC Communications, Inc.<F1> 1,851
56,100 Network Access Solutions Corporation<F1> 726
33,200 Viatel, Inc.<F1> 1,108
-----------
3,685
-----------
Total Common Stock (Cost $126,363) 136,976
-----------
Number Market Value
of Shares (in thousands)
----------- -------------
SHORT-TERM INVESTMENTS 11.6%
INVESTMENT COMPANIES 1.5%
18 Financial Square Prime Obligation Fund $18
2,228 Short-Term Investments Co. Liquid Assets Portfolio 2,228
-----------
Total Investment Companies (Cost $2,246) 2,246
-----------
Principal
Amount
(in thousands)
- --------------
VARIABLE RATE DEMAND NOTES 10.1%
$ 4,000 American Family Financial Services, Inc. 4,000
5,000 General Mills, Inc. 5,000
6,000 Sara Lee Corporation 6,000
-----------
Total Variable Rate Demand Notes (Cost $15,000) 15,000
-----------
Total Short-Term Investments (Cost $17,246) 17,246
-----------
Total Investments (Cost $143,609) 103.3% 154,222
-----------
Liabilities, less Other Assets (3.3)% (4,906)
-----------
TOTAL NET ASSETS 100.0% $149,316
===========
<F1> Non-income producing
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
MICROCAP FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
COMMON STOCKS 97.8%
AIR TRANSPORTATION 0.0%
6,200 Indigo Aviation AB ADR<F1> $42
-----------
BROADCASTING - RADIO & TELEVISION 1.7%
98,600 Saga Communications, Inc.<F1> 2,379
17,000 Wink Communications, Inc.<F1> 597
-----------
2,976
-----------
CHILD CARE 0.3%
39,800 Childtime Learning Centers, Inc.<F1> 489
-----------
COMMERCIAL SERVICES 0.5%
86,100 Armor Holdings, Inc.<F1> 834
-----------
COMPUTER SOFTWARE & SERVICES 14.4%
70,900 AremisSoft Corporation<F1> 900
8,600 Cysive, Inc.<F1> 495
37,400 Javelin Systems, Inc.<F1> 307
85,900 Luminant Worldwide Corporation<F1> 3,361
77,300 Netscout Systems, Inc.<F1> 1,585
88,000 NETsilicon, Inc.<F1> 1,122
39,800 PC-Tel, Inc.<F1> 1,194
181,300 Peerless Systems Corporation<F1> 1,739
236,700 ProSoft Training.Com<F1> 710
216,800 Sagent Technology, Inc.<F1> 2,886
12,800 SalesLogix Corporation<F1> 403
198,900 Smith-Gardner &Associates, Inc.<F1> 1,916
88,400 Tanning Technology Corporation<F1> 3,105
59,900 Technisource, Inc.<F1> 228
21,500 TIBCO Software, Inc.<F1> 839
2,785 Tridium, Inc.<F1><F2> 1,524
20,200 Viant Corporation<F1> 2,010
89,900 ZapMe! Corporation<F1> 674
-----------
24,998
-----------
CONSTRUCTION EQUIPMENT 0.5%
112,400 CMI Corporation<F1> 773
-----------
DISTRIBUTION 0.9%
22,825 Insight Enterprises, Inc.<F1> 853
68,550 Pomeroy Computer Resources, Inc. <F1> 711
-----------
1,564
-----------
DRUGS 1.2%
137,300 D&K Healthcare Resources, Inc.<F1> 2,153
-----------
ITED)
Number Market Value
of Shares (in thousands)
----------- -------------
ELECTRONICS 17.5%
67,700 Alpha Industries, Inc.<F1> $ 3,740
65,400 Anaren Microwave, Inc.<F1> 2,240
214,700 Catalyst Semiconductor, Inc.<F1> 315
46,500 Exar Corporation<F1> 1,680
325,100 Galileo Technology Ltd.<F1> 7,437
75,600 Interlink Electronics, Inc.<F1> 964
38,500 JNI Corporation<F1> 2,057
67,200 LTX Corporation<F1> 1,063
40,700 Newport Corporation 794
85,600 Plug Power, Inc.<F1> 1,370
64,200 Quicklogic Corporation<F1> 1,180
221,900 Telecom Semiconductor, Inc.<F1> 2,053
159,900 Three Five Systems, Inc.<F1> 5,376
-----------
30,269
-----------
ENTERTAINMENT & LEISURE 1.9%
143,700 Championship Auto Racing Teams, Inc.<F1> 3,296
-----------
FINANCIAL SERVICES 0.2%
8,500 Greater Bay Bancorp<F1> 310
-----------
HEALTH CARE SERVICES & SUPPLIES 3.3%
18,600 Albany Molecular Research<F1> 463
22,700 ChiRex, Inc.<F1> 641
129,400 Polymedia Corporation<F1> 2,734
149,600 Quadramed Corporation<F1> 844
60,800 Stericycle, Inc.<F1> 950
-----------
5,632
-----------
HOME FURNISHINGS 0.7%
52,200 American Woodmark Corporation<F1> 1,161
-----------
INSURANCE 0.4%
36,800 Triad Guaranty, Inc.<F1> 757
-----------
INTERNET PRODUCTS & SERVICES 8.4%
8,500 Akamai Technologies, Inc.<F1> 1,234
47,300 Allscripts, Inc.<F1> 739
22,500 GoTo.Com, Inc.<F1> 1,283
86,000 High Speed Access Corporation<F1> 2,263
85,900 Interliant, Inc.<F1> 1,074
41,100 Internet Commerce Corporation<F1> 647
404,500 Musicmaker.com, Inc.<F1> 3,082
51,600 NetZero, Inc.<F1> 1,061
85,900 uBid, Inc.<F1> 3,146
-----------
14,529
-----------
MEDICAL INSTRUMENTS 1.3%
103,200 Candela Corporation<F1> 1,393
86,000 KeraVision, Inc.<F1> 903
-----------
2,296
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
MICROCAP FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
OIL & GAS - DOMESTIC 4.1%
99,400 Cabot Oil & Gas Corporation $1,603
110,500 Cross Timbers Oil Company 1,229
122,500 HS Resources, Inc.<F1> 1,914
64,400 Louis Dreyfus Natural Gas Corp.<F1> 1,288
272,800 Range Resources Corporation 1,023
-----------
7,057
-----------
OIL & GAS SERVICES 6.1%
55,800 Cal Dive International, Inc.<F1> 1,876
223,400 Horizon Offshore, Inc.<F1> 1,396
160,500 Key Energy Services, Inc.<F1> 722
43,700 Maverick Tube Corporation<F1> 808
81,700 Midcoast Energy Resources, Inc. 1,491
160,700 Oceaneering International, Inc.<F1> 2,179
106,100 Superior Energy Services, Inc.<F1> 663
90,200 Unit Corporation<F1> 586
38,900 UTI Energy Corporation<F1> 746
-----------
10,467
-----------
PRIVATE CORRECTION FACILITIES 2.3%
307,100 Cornell Corrections, Inc. <F1> 3,973
-----------
RETAIL 5.6%
128,400 Charlotte Russe Holding, Inc.<F1> 1,814
139,800 Chico's Fas, Inc.<F1> 4,386
80,900 Party City Corporation<F1> 103
88,300 Steven Madden, Ltd.<F1> 1,082
135,100 Ultimate Electronics, Inc.<F1> 2,297
-----------
9,682
-----------
SCHOOLS 3.4%
139,400 Career Education Corporation<F1> 3,067
132,500 Corinthian Colleges, Inc.<F1> 2,584
309,500 EduTrek International, Inc.<F1> 253
-----------
5,904
-----------
TELECOMMUNICATIONS 11.4%
158,100 Adelphia Business Solutions, Inc.<F1> 4,486
42,800 Aether Systems, Inc.<F1> 2,977
214,300 DSL.net Inc.<F1> 2,063
128,600 Metro One Telecommunicatiuons, Inc.<F1> 1,993
44,000 NorthEast Optic Network, Inc.<F1> 1,601
117,100 Transaction Network Services, Inc.<F1> 4,662
17,000 Triton PCS Holdings, Inc.<F1> 599
49,400 US LEC Corp.<F1> 1,368
-----------
19,749
-----------
Number Market Value
of Shares (in thousands)
----------- -------------
TELECOMMUNICATIONS EQUIPMENT 10.9%
213,900 Ancor Communications, Inc.<F1> $6,778
104,000 Digital Microwave Corporation<F1> 1,547
19,300 Interspeed, Inc.<F1> 214
137,400 P-Com, Inc.<F1> 635
175,800 Paradyne Networks, Inc.<F1> 5,340
158,400 REMEC, Inc.<F1> 1,652
12,800 Sycamore Networks, Inc.<F1> 2,752
-----------
18,918
-----------
VETERINARY HOSPITALS 0.8%
123,000 Veterinary Centers of America, Inc. <F1> 1,445
-----------
Total Common Stock (Cost $134,973) 169,274
-----------
Number
of Shares
(in thousands)
- --------------
SHORT-TERM INVESTMENTS 1.5%
INVESTMENT COMPANIES 1.5%
2,495 Short-Term Investments Co. Liquid Assets Portfolio 2,495
-----------
Total Investment Companies (Cost $2,495) 2,495
-----------
Total Short-Term Investments (Cost $2,495) 2,495
-----------
Total Investments (Cost $137,468) 99.3% 171,769
-----------
Other Assets, less Liabilities 0.7% 1,257
-----------
TOTAL NET ASSETS 100.0% $173,026
===========
<F1> Non-income producing
<F2> Fair valued security
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market
of Shares Industry Value
----------- --------- -------------
COMMON AND PREFERRED STOCKS 92.2%
AUSTRALIA 2.4%
34,000 Broken Hill Proprietary
Company Limited Diversified Operations $351,181
2,300 EVN AG Utility 330,022
31,864 National Australia
Bank Ltd. Banks 491,434
305,000 Pasminco Limited Diversified Minerals 291,568
-----------
1,464,205
-----------
AUSTRIA 2.2%
9,787 Bank Austria AG<F1> Banks 486,315
7,000 Boehler-Uddeholm AG Steel 292,862
8,300 VA Technologie AG Engineering 554,642
-----------
1,333,819
-----------
BRAZIL 1.2%
8,500 Companhia Vale do
Rio Doce ADR Diversified Minerals 165,773
3,100 Telecomunicacoes
Brasileiras
SA-Telebras ADR
Pfd Block Telecommunications 241,413
15,000 Uniao de Bancos
Brasileiros
(Unibanco) SA Banks 346,875
-----------
754,061
-----------
CANADA 2.7%
12,000 Alcan Aluminum Ltd. Metal - Aluminum 395,250
45,000 Moore Corporation Ltd. Business Services 376,875
146,000 Methanex Corporation<F1> Chemicals 406,962
87,000 Nexfor, Inc. Building Products - Wood 440,649
-----------
1,619,736
-----------
CHINA 0.4%
57,000 Shandong Huaneng Power
Company Ltd. ADR Electric Utility 235,125
-----------
COLOMBIA 0.1%
9,200 Bancolombia SA ADR Banks 39,963
-----------
CROATIA 0.5%
30,000 Pliva d.d. 144A GDR<F2> Pharmaceuticals 325,830
-----------
CZECH REPUBLIC 2.4%
251,500 A/S Ceske Enorgeticke
Zavody AS<F1> Electric Power Company 660,201
96,000 Komercni Banka A.S. ADR Banks 811,930
-----------
1,472,131
-----------
DENMARK 1.2%
3,500 A/S Forsikringsselskabet
Codan Insurance 316,742
5,065 Unidanmark AS Banks 393,913
-----------
710,655
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market
of Shares Industry Value
----------- --------- -------------
FINLAND 1.5%
1 Instrumentarium Corporation Medical Products $34
73,200 Kemira Oyj Chemicals 451,681
19,000 Orion-Yhtyma Oyj "B" Drugs 451,382
-----------
903,097
-----------
FRANCE 3.9%
4,003 Banque Nationale de Paris Banks 351,362
2,100 Compagnie de Saint Gobain Building & Construction 364,238
14,300 Rhone-Poulenc SA Drugs 799,706
12,000 Scor Assistance Insurance 599,180
20,000 Usinor SA Steel 277,725
-----------
2,392,211
-----------
GERMANY 2.3%
13,300 BASF AG Chemicals 597,682
18,000 Bilfinger & Berger Bau AG Building & Construction 368,969
22,100 Viag AG Diversified Manufacturing 407,711
-----------
1,374,362
-----------
GREAT BRITAIN 8.7%
55,000 British Airways PLC Airlines 285,875
38,650 British
Telecommunciations PLC Telecommunications 699,873
72,000 Enterprise Oil PLC<F1> Oil & Gas Exploration 511,585
26,000 National Westminster
Bank PLC Banks 586,216
106,500 Nycomed Amersham PLC Medical Products 647,493
163,823 Rolls-Royce PLC<F1> Aerospace & Aircraft 580,666
92,394 Royal & Sun Alliance
Insurance Group PLC Insurance 627,685
53,024 Scottish and Southern
Energy PLC Electricity - Integrated 502,484
238,916 Storehouse PLC Retail 282,277
203,000 Tesco PLC Retail - Food 602,937
-----------
5,327,091
-----------
HONG KONG 4.4%
53,400 HSBC Holdings PLC Banks 643,487
62,000 Hutchison Whampoa Limited Diversified Operations 622,434
125,047 Jardine Matheson
Holdings Ltd. Diversified Operations 537,702
2,340,000 Pacific Ports
Company Ltd.<F1> Transportation Services 268,048
142,000 Peregrine Investments
Holdings Limited Financial Services 0
782,500 Swire Pacific Ltd. Diversified Operations 579,107
-----------
2,650,778
-----------
INDIA 0.4%
21,000 BSES Ltd. 144A GDR<F2> Electric Utility 234,127
-----------
INDONESIA 0.7%
255,000 PT Indonesian Satellite Telecommunications 414,725
-----------
ITALY 1.4%
40,000 Burgo (Cartiere) SPA Paper Products 294,334
69,000 Societa Assicuratrice
Industriale Insurance 326,395
74,000 Telecom Italia Mobile SPA Telecommunications 256,701
-----------
877,430
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market
of Shares Industry Value
----------- --------- -------------
JAPAN 25.3%
20,000 Aoyama Trading Co., Ltd. Retail - Apparel/Shoes $638,176
115,000 Asahi Chemical
Industry, Ltd. Chemicals 694,232
91,000 The Dai-Ichi Kangyo
Bank, Ltd. Banks 1,246,934
42,000 Daiichi Pharmaceutical
Co., Ltd. Drugs 601,667
49,800 Daito Trust
Construction Co. Real Estate 743,946
52,000 Daiwa House Industry
Co., Ltd. Construction 475,355
129,000 Daiwa Securities
Company Limited Financial Services 1,375,786
101,000 Hitachi Ltd. Electrical Products 1,090,715
125,000 Kyudenko Co., Ltd. Electrical Engineering 515,044
360,000 Marubeni Corporation Distribution / Wholesale 1,145,266
31,000 Marui Co., Ltd. Retail 585,186
22,000 NEC Corporation Electrical Products 444,806
125,600 Nichido Fire &
Marine Insurance Insurance 771,460
204,000 Nippon Fire &
Marine Insurance Insurance 807,321
110,000 Nishimatsu Construction
Co., Ltd. Building & Construction 578,670
36 NTT Mobile Communication
Network, Inc Telecommunications 955,539
22,000 Sankyo Company, Ltd. Drugs 626,102
134,000 The Sumitomo Trust &
Banking Co., Ltd. Banks 1,368,762
120,000 The Toyo Trust &
Banking Co., Ltd. Banks 758,911
-----------
15,423,878
-----------
MALAYSIA 3.2%
180,000 Malakoff Bhd Agricultural Operations 421,579
241,000 Malayan Banking Bhd Banks 818,132
70,400 O.Y.L. Industries Bhd Air & Heating Systems 159,326
450,000 Road Builder (M)
Holdings Bhd Building & Construction 537,632
-----------
1,936,669
-----------
MEXICO 1.3%
9,000 Telefonos de Mexico SA Telecommunications 769,500
-----------
NETHERLANDS 3.6%
10,200 DSM NV Chemicals 385,998
48,500 EVC International NV Chemicals 433,354
14,754 Koninklijke Ahrend NV Office & Funiture 202,396
13,000 Koninklijke KPN NV Telecommunications 666,740
18,000 Koninklijke Pakhoed NV Warehousing &
Harbor Services 502,365
-----------
2,190,853
-----------
NEW ZEALAND 2.7%
361,000 Air New Zealand Limited
- Class B Air Transportation 533,597
434,000 Carter Holt Harvey Limited Paper Products 549,228
252,000 Fletcher Challenge Energy Oil & Gas Exploration 580,410
-----------
1,663,235
-----------
NORWAY 1.6%
25,000 Bergesen d.y. ASA "B" Transportation 385,616
20,000 Odfjell ASA "A" Marine Services 243,480
16,700 Sparebanken NOR Banks 366,163
-----------
995,259
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market
of Shares Industry Value
----------- --------- -------------
PHILIPPINES 1.1%
33,000 Metropolitan Bank &
Trust Company Banks $246,575
20,000 Philippine Long Distance
Telephone Company Telecommunications 415,940
-----------
662,515
-----------
RUSSIA 0.6%
4,700 Lukoil Holding ADR Oil & Gas - International 148,896
41,000 Rostelecom ADR Telecommunications 225,500
-----------
374,396
-----------
SINGAPORE 2.9%
80,000 Asia Pulp & Paper
Company Ltd. ADR<F1> Paper Products 555,000
97,000 City Developments Limited Real Estate 501,382
90,000 United Overseas Bank Ltd. Banks 681,572
-----------
1,737,954
-----------
SLOVAK REPUBLIC 0.6%
13,000 Nafta Gbely AS Geological Exploration 140,711
30,000 Slovakofarma 144A GDR <F2> Health & Beauty Aids 88,500
39,000 VSZ AS <F1> Steel 136,021
-----------
365,232
-----------
SOUTH AFRICA 2.1%
11,416 AngloGold Limited Mining 644,646
182,500 Standard Bank Investment
Corporation Limited Banks 623,678
-----------
1,268,324
-----------
SPAIN 3.0%
13,500 Catalana Occidente Insurance 268,212
12,000 Construcciones y
Auxiliar de
Ferrocarriles SA Manufacturing - Misc. 300,221
46,000 Iberdrola SA Electricity - Distribution 670,199
30,000 Repsol SA Oil & Gas - International 618,102
-----------
1,856,734
-----------
SWEDEN 3.8%
8,956 ABB Ltd.<F1> Engineering 890,360
35,490 AssiDoman AB Paper & Related Products 633,273
17,612 AstraZeneca Group PLC Drugs 794,210
-----------
2,317,843
-----------
SWITZERLAND 2.4%
413 Holderbank Building Products 508,762
700 Schweizerische
Lebensversicherungs-und
Rentenanstalt Insurance 413,467
1,750 UBS AG Bank 509,369
-----------
1,431,598
-----------
THAILAND 1.6%
710,000 Thai Farmers Bank
Public Company Limited Banks 1,002,461
-----------
Total Common and Preferred Stocks (Cost $55,116,069) 56,125,797
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market
of Shares Industry Value
----------- --------- -------------
SHORT-TERM INVESTMENTS 7.0%
INVESTMENT COMPANIES 3.4%
10,000 Genesis Chile Fund Investment Companies $270,000
101,000 Korea Fund, Inc. Investment Companies 1,287,750
63 Thailand International Fund Investment Companies 535,500
-----------
Total Investment Companies (Cost $2,084,502) 2,093,250
-----------
Principal
Amount
---------
VARIABLE RATE DEMAND NOTES 3.6%
$2,178,739 Chase U.S. 2,178,739
-----------
Total Variable Rate Demand Notes (Cost $2,178,739) 2,178,739
-----------
Total Short-Term Investments (Cost $4,263,241) 4,271,989
-----------
Total Investments (Cost $59,379,310) 99.2% 60,397,786
-----------
Other Assets, less Liabilities 0.8% 487,418
-----------
TOTAL NET ASSETS 100% $60,885,204
===========
<F1> Non-income producing
<F2> Unregistered security
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
- --------------------------------------------------------------------------------
1999: THE FLIP SIDE OF 1998
- --------------------------------------------------------------------------------
This year was marked by a dramatic rise in interest rates as the U.S. economy
remained robust and fears of inflation persisted. As illustrated by the chart
below, interest rates for all maturities rose significantly, depressing bond
prices. The Federal Reserve raised the Federal Funds rate by 0.75%; 0.25% in
June, 0.25% in August, and another increase of 0.25% in November which
completely reversed the easing moves undertaken in 1998. In many ways, 1999 was
the flip side of 1998.
TREASURY YIELD CURVE COMPARISON
MATURITY 10/31/98 10/31/99 YTD
(YEARS) YIELD (%) YIELD (%) CHANGE
-------- -------- -------- --------
1 YEAR 4.18 5.41 1.23
2 YEAR 4.11 5.78 1.67
5 YEAR 4.23 5.94 1.71
10 YEAR 4.60 6.02 1.42
30 YEAR 5.15 6.16 1.01
Last year, mild inflation, stalling Asian economies and hints of slower domestic
growth provided good support for bonds. Additionally, the near collapse of some
prominent hedge funds caused the Federal Reserve to provide additional liquidity
to the system, resulting in lower U.S. Treasury yields and higher prices. This
year, with the recovery in Asia, stability in the financial system and solid
economic growth paced by the U.S. consumer, interest rates reversed course.
While the interim volatility is tough for bond investors (and their portfolio
managers!), the bond market once again is acting like a thermostat for the
economy. We contend the rise in rates will lead to a longer, more sustainable
economic expansion. Interest rates, at current levels, provide our bond
investors with attractive opportunities.
ATTRACTIVE REAL YIELDS: AN OPPORTUNITY FOR INVESTORS
The rise in interest rates in 1999 presents attractive valuations in the bond
market. Real yields, or the nominal yield of a bond minus the current or
expected rate of inflation, are high as shown below for three U.S. Treasury
maturities representing intermediate term securities.
3 YEAR 5 YEAR 10 YEAR
Historical Average Real Yield
(1960-10/31/99) 2.41% 2.56% 2.75%
Current Real Yield - 10/31/99 3.30% 3.37% 3.42%
Current real yields are substantially higher than historical averages and
provide a positive backdrop for all bond investors.
CHANGING LANDSCAPE IN THE BOND MARKET
During 1999, we continue to observe record new issuance of debt by U.S. and
foreign corporations. According to Lehman Brothers, a record $235 billion of net
new supply of corporate bonds will be issued in 1999 while net new issuance of
U.S. Treasuries will actually be negative for the second straight year. These
divergent trends in U.S. Treasury and corporate bond supply are changing the
composition of the bond market. In summary, the U.S. Treasury budget surplus
has allowed the Treasury to reduce its issuance of bonds, while the corporate
bond supply expanded as companies took on new debt in order to leverage their
potential return on equity. (see chart below)
NET NEW SUPPLY
INVESTMENT GRADE CORPORATE DEBT VERSUS U.S. TREASURY DEBT
Corporate Treasury
Supply Supply
-------- --------
1992 72.77 282.50
1993 66.36 235.40
1994 30.36 136.50
1995 84.72 181.20
1996 96.92 152.50
1997 104.67 (2.90)
1998 219.25 (101.00)
1999 estimate 235.00 (78.50)
Source: Lehman Brothers, Merrill Lynch, U.S. Treasury
<PAGE>
(LOGO) FIRSTAR FUNDS
OVERALL LOWER QUALITY CORPORATES
The record increase of investment-grade corporate supply comes at a time when
overall credit ratings on corporate debt have deteriorated. Since the 1970's,
there has been a steady shift in the corporate bond market away from AAA and AA
rated bonds toward A and BAA. The data for this chart (provided by Lehman
Brothers, since the inception of its corporate bond index) shows that the new
supply has been lower quality and also the number of downgrades by rating
agencies has decisively and consistently exceeded the number of upgrades. This
phenomenon has occurred during periods of both economic expansion and recession,
during periods of both rising and falling interest rates, and during periods of
both yield curve flattening and steepening. We expect this trend to continue as
U.S. corporate management teams continue their focus on stockholder value rather
than maintaining very high quality debt ratings.
QUALITY ANALYSIS OF THE LEHMAN BROTHERS CORPORATE INDEX
1973 THROUGH OCTOBER 31, 1999
<TABLE>
<CAPTION>
Year AAA Index AA Index A Index BAA Index Total AAA Index AA Index A Index BAA Index
- ---- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1973 32,313 36,377 38,616 11,226 118,532 27.26% 30.69% 32.58% 9.47%
1974 34,185 32,656 39,255 10,653 116,749 29.28% 27.97% 33.62% 9.12%
1975 42,661 42,450 51,469 18,099 154,679 27.58% 27.44% 33.27% 11.70%
1976 50,599 53,992 61,095 25,005 190,691 26.53% 28.31% 32.04% 13.11%
1977 50,211 55,714 64,123 23,432 193,480 25.95% 28.80% 33.14% 12.11%
1978 47,403 53,520 63,545 21,471 185,939 25.49% 28.78% 34.18% 11.55%
1979 49,579 45,464 64,809 18,745 178,597 27.76% 25.46% 36.29% 10.50%
1980 45,002 45,190 65,096 22,384 177,672 25.33% 25.43% 36.64% 12.60%
1981 37,396 45,841 65,422 24,637 173,296 21.58% 26.45% 37.75% 14.22%
1982 43,682 66,254 79,812 43,808 233,556 18.70% 28.37% 34.17% 18.76%
1983 18,891 82,079 88,797 45,623 235,390 8.03% 34.87% 37.72% 19.38%
1984 11,781 101,772 97,884 43,969 255,406 4.61% 39.85% 38.32% 17.22%
1985 17,768 114,107 125,689 58,936 316,500 5.61% 36.05% 39.71% 18.62%
1986 31,828 140,549 136,861 83,806 393,044 8.10% 35.76% 34.82% 21.32%
1987 39,949 140,014 124,864 84,920 389,747 10.25% 35.92% 32.04% 21.79%
1988 34,423 112,733 154,172 108,899 410,227 8.39% 27.48% 37.58% 26.55%
1989 77,703 139,985 181,728 114,072 513,488 15.13% 27.26% 35.39% 22.22%
1990 87,593 143,857 188,156 121,185 540,791 16.20% 26.60% 34.79% 22.41%
1991 62,917 131,578 268,762 137,657 600,914 10.47% 21.90% 44.73% 22.91%
1992 55,280 134,821 284,322 185,399 659,822 8.38% 20.43% 43.09% 28.10%
1993 46,422 113,290 341,658 195,292 696,662 6.66% 16.26% 49.04% 28.03%
1994 65,657 107,612 333,843 156,887 663,999 9.89% 16.21% 50.28% 23.63%
1995 38,869 144,349 416,248 193,757 793,223 4.90% 18.20% 52.48% 24.43%
1996 36,753 154,466 442,920 203,644 837,783 4.39% 18.44% 52.87% 24.31%
1997 41,440 181,546 462,615 276,812 962,413 4.31% 18.86% 48.07% 28.76%
1998 68,485 248,867 502,832 376,459 1,196,643 5.72% 20.80% 42.02% 31.46%
Oct-99 71,477 223,389 516,947 338,246 1,150,059 6.22% 19.42% 44.95% 29.41%
</TABLE>
SOURCE: LEHMAN BROTHERS
QUALITY BREAKDOWN OF THE LEHMAN BROTHERS INVESTMENT GRADE CORPORATE BOND INDEX.
CORPORATE DEBT EXPERIENCES AN INCREASE IN DEFAULTS
In addition to the increase in corporate issuance, we have also observed a
record number of corporations defaulting on their debt. Although the U.S.
economy has experienced record expansion during the past nine years, Standard &
Poor's reports a total of $34 billion in corporate debt will default in 1999.
This trend is of particular concern as record default rates generally occur
during economic recessions, not expansions.
Corporate Debt Defaults
(in $ millions)
Total Debt
Year ($ millions)
-------------- --------------
1981 $60
1982 $843
1983 $417
1984 $648
1985 $1,176
1986 $3,263
1987 $9,056
1988 $4,439
1989 $5,965
1990 $15,094
1991 $19,800
1992 $4,740
1993 $1,425
1994 $4,060
1995 $7,250
1996 $3,639
1997 $4,348
1998 $10,858
1999 10 months $34,285
Source: Standard & Poor's
LOOKING AHEAD
Volatility and changes in the bond market landscape continue to provide
opportunities for investors. This environment, however, is not without risk. Our
fixed-income team continues to work to take advantage of the opportunities and
volatility while controlling the risk. Current real yields are substantially
higher than historical averages and provide a positive backdrop for all bond
investors. In addition, we have witnessed a tightening of spreads on corporate
bonds from historically wide levels seen in the fall of 1998. During 1999, we
took advantage of wide spreads and selectively increased the Funds' exposure to
spread product sectors. Overall, this had a positive impact on performance for
the year. Our fixed-income research team will continually and diligently screen
the bond market to add value while controlling risk. We are committed to
providing our shareholders with a disciplined investment strategy in all
environments. Although we are witnessing a different bond market from 1998, we
are pleased with the added-value results achieved throughout the year.
As the year ends, we look forward to the prospects of delivering consistent and
competitive fixed-income results for investors as we enter the new millennium.
Thank you for your support.
MARY ELLEN STANEK, CFA DANIEL A. TRANCHITA, CFA
SHARON deGUZMAN WARREN D. PIERSON, CFA
Portfolio Managers - Firstar Investment Research & Management Company, LLC
(FIRMCO)
<PAGE>
(LOGO) FIRSTAR FUNDS
- --------------------------------------------------------------------------------
SHORT-TERM BOND MARKET FUND
- --------------------------------------------------------------------------------
FIRSTAR SHORT-TERM BOND MARKET FUND seeks to provide an annual rate of total
return comparable to that of the Lehman Brothers 1-3 Year Government/Corporate
Bond Index, before Fund expenses. In order to achieve its objective, the Fund
may invest in securities with short to intermediate remaining maturities.
This Fund's maturity mix gives the portfolio an overall AVERAGE MATURITY OF 2.3
YEARS and a DURATION OF 1.7 YEARS. Since the Firstar Short-Term Bond Market
Fund's duration is just under 2 years, the Fund is the shortest of all the
Firstar taxable bond funds and has historically displayed the least downward
price movement when interest rates increase, but has exhibited the least upward
price movement when interest rates decrease. While the Fund's duration is the
single most significant determinant of its return, the Fund's sector allocation
is also important.
During 1999, spreads on corporate bonds, asset-backed and mortgage-backed
securities tightened from historically wide levels in the fall of 1998. Since
that time, we selectively increased the Fund's exposure to these sectors. With
the spreads contracting, these sectors have contributed positively to the
performance of the Fund over the past year.
CORPORATE BONDS
The Fund's careful, research-intensive process of selecting investment-grade
corporate issues, asset-backed securities and mortgages gives the Fund a high-
quality focus. As of October 31, 1999, the Fund had 62% invested in securities
rated AAA or higher. Currently the Fund's exposure to the corporate sector
represents 35%. Sectors of the corporate market that we continue to favor
include finance, banking and brokerage.
MORTGAGE-BACKED AND ASSET-BACKED SECURITIES
In general, we purchase only the highest rated (Aaa and Agency) collateralized
mortgage obligations (CMOs) and asset-backed securities (ABS). We utilize
shorter duration structures with more predictable "cash flow" characteristics.
This restrained use of mortgage- and asset-backed securities instruments is a
by-product of our requirement to precisely measure the duration of the portfolio
and ensure we "match" the duration of the benchmark index at all times. The
Firstar Short-Term Bond Market Fund currently invests 40% in mortgages and
asset-backed securities.
CONSISTENCY IS THE HALLMARK OF OUR APPROACH
Since Firstar Short-Term Bond Market Fund's inception on 12/29/89, we have
adhered to the same disciplined management approach. During the past 9+ years
the financial markets have become more volatile. THE HALLMARK OF OUR APPROACH
HAS BEEN THE FUND'S CONSISTENT PERFORMANCE IN ALL MARKET CLIMATES. Firstar
Short-Term Bond Market Fund's returns have been comparable to the benchmark in
periods of rising interest rates and falling interest rates. Our goal is to
continue to deliver this same consistent performance in the future.
We look forward to continuing to serve you as a Firstar Fund shareholder.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
(PHOTO) (PHOTO)
MARY ELLEN STANEK, CFA SHARON deGUZMAN
MARY ELLEN STANEK, CFA, President and Chief Executive Officer of Firstar
Investment Research &Management Company, LLC (FIRMCO) and SHARON DEGUZMAN,
Assistant Vice President and Portfolio Manager, co-manage the Fund _ Mary Ellen
since its inception on December 29, 1989 and Sharon since March 1, 1999. Mary
Ellen has 21 years of investment management experience and was named a Director
of FIRMCO in 1992 and President in 1994. Prior to joining FIRMCO, she headed the
Fixed Income and Quantitative Investment Management Department at Firstar Trust
Company. Mary Ellen received her BA from Marquette University in 1978 and her
MBA from the University of Wisconsin-Milwaukee in 1984. Sharon has been with
FIRMCO since 1994 and has eight years of investment experience. She received her
BA from Eastern Illinois University in 1988. Mary Ellen is a Chartered Financial
Analyst.
<PAGE>
(LOGO) FIRSTAR FUNDS
LEHMAN BROTHERS
FIRSTAR SHORT-TERM 1-3 YEAR
BOND MARKET FUND - GOV'T./CORP.
INSTITUTIONAL INDEX<F4>
------------------- -------------------
12/29/89 10,000 10,000
10/90 10,464 10,738
10/91 11,865 11,964
10/92 12,966 12,943
10/93 13,833 13,712
10/94 14,035 13,879
10/95 15,290 15,118
10/96 16,177 16,030
10/97 17,223 17,073
10/98 18,402 18,364
10/99 19,031 18,952
This chart assumes an initial investment of $10,000 made on 12/29/89
(inception). Performance reflects fee waivers in effect. In the absence of fee
waivers, total return would be reduced. Performance is shown for Institutional
shares, which have lower expenses than Series A or Series B shares. If those
fees and expenses were reflected in the chart above, total return would have
been reduced. Returns shown include the reinvestment of all dividends and other
distributions. Past performance is not predictive of future performance.
Investment return and principal value will fluctuate, so that your shares, when
redeemed, may be worth more or less than their original cost.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR YEARS ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
1 3 5
Year Years Years Since Inception
- --------------------------------------------------------------------------------
FIRSTAR SHORT-TERM BOND
MARKET FUND - INSTITUTIONAL 3.4 5.6 6.3 6.8 (12/29/89)
FIRSTAR SHORT-TERM
BOND MARKET FUND - A - NO LOAD 3.2 5.3 6.0 6.6 (12/29/89)
FIRSTAR SHORT-TERM BOND
MARKET FUND - A - LOAD<F2> (0.7) 4.0 5.2 6.2 (12/29/89)
FIRSTAR SHORT-TERM BOND
MARKET FUND - B - NO LOAD - - - 2.2 (3/1/99)<F1>
FIRSTAR SHORT-TERM BOND
MARKET FUND - B - LOAD<F3> - - - (2.8) (3/1/99)<F1>
LEHMAN BROTHERS 1-3 YEAR
GOV'T./CORP. BOND INDEX<F4> 3.2 5.7 6.4 6.7 (12/29/89)
- --------------------------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1, 1999 to October 31, 1999 is
not annualized.
<F2> Reflects maximum sales charge of 3.75%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The Lehman Brothers 1-3 Year Gov't./Corp. Bond Index is an unmanaged market
value weighted index measuring both principal price changes of, and income
provided by, the underlying universe of securities that comprise the index.
Securities included in the index must meet the following criteria: fixed as
opposed to variable rate; not less than one year to maturity; not more than
three years remaining to maturity; and minimum outstanding par value of
$100 million. An investment cannot be made directly in an index.
The Lehman Brothers 1-3 Year Government/Corporate Bond Index, the Lehman
Brothers Intermediate Government/Corporate Bond Index and the Lehman Brothers
Government/Corporate Bond Index are trademarks of Lehman Brothers. The Fund, its
Adviser and the Co-Administrators are not affiliated in any way with Lehman
Brothers. Inclusion of a security in a bond index in no way implies an opinion
by Lehman Brothers as to its attractiveness or appropriateness as an investment.
Lehman Brothers' publication of the bond index is not made in connection with
any sale or offer for sale of securities or any solicitation of orders for the
purchase of securities.
Effective at the close of business January 9, 1995, Firstar Funds began to offer
Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 3.75%
maximum sales load and are subject to an annual 0.25% service organization fee.
The load performance for the Series A shares has been restated to reflect the
impact of the current sales charge. Series A performance prior to January 10,
1995, does not reflect the service organization fees. If service organization
fees had been reflected, performance would be reduced. Series B shares have a
5.00% maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
SECTOR DISTRIBUTION
10/31/99
- -----------------------------------
U.S. TREASURY 21%
- -----------------------------------
U.S. GOVERNMENT AGENCY 0%
- -----------------------------------
MORTGAGE-BACKED<F1> 8%
- -----------------------------------
FINANCE, BANKING, BROKERAGE 23%
- -----------------------------------
INDUSTRIAL 2%
- -----------------------------------
UTILITY 3%
- -----------------------------------
INTERNATIONAL/YANKEE 7%
- -----------------------------------
ASSET-BACKED 32%
- -----------------------------------
CASH AND OTHER 4%
- -----------------------------------
TAXABLE MUNICIPAL 0%
- -----------------------------------
TOTAL 100%
- -----------------------------------
PORTFOLIO COMPOSITION
10/31/99
- -----------------------------------
AVERAGE MATURITY 2.3 YEARS
- -----------------------------------
AVERAGE DURATION 1.7 YEARS
- -----------------------------------
<F1> incl. U.S. Govt. Agency-Backed
QUALITY DISTRIBUTION
10/31/99
- -----------------------------------
U.S. TREASURY 21%
- -----------------------------------
U.S. GOVERNMENT AGENCY 3%
- -----------------------------------
Aaa 38%
- -----------------------------------
Aa 4%
- -----------------------------------
A 18%
- -----------------------------------
Baa 16%
- -----------------------------------
Ba 0%
- -----------------------------------
TOTAL 100%
- -----------------------------------
SEC 30-DAY YIELD
- -----------------------------------
INSTITUTIONAL 5.98%
- -----------------------------------
A - NO LOAD 5.73%
- -----------------------------------
A - LOAD 5.52%
- -----------------------------------
B - NO LOAD 4.98%
- -----------------------------------
TOTAL FUND NET ASSETS
10/31/99
- -----------------------------------
$196,618,206
- -----------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
- --------------------------------------------------------------------------------
INTERMEDIATE BOND MARKET FUND
- --------------------------------------------------------------------------------
FIRSTAR INTERMEDIATE BOND MARKET FUND seeks to provide an annual rate of total
return comparable to that of the Lehman Brothers Intermediate
Government/Corporate Bond Index, before Fund expenses. In order to achieve its
objective, the Fund may invest in securities with long remaining maturities (10
years or longer) in addition to shorter bonds and notes.
This Fund's maturity mix gives the portfolio an overall AVERAGE MATURITY OF 5.5
YEARS and a DURATION OF 3.4 YEARS. Firstar Intermediate Bond Fund's duration is
just over three years and is between the durations of the other Firstar taxable
bond funds. If interest rates rise this Fund will display more downward price
movement than the Short-Term Bond Market Fund and less than the Bond IMMDEXTM
Fund. When interest rates fall, this Fund will exhibit more upward price
movement than Short-Term Bond Market Fund and less than the Bond IMMDEX/TM Fund.
During 1999, spreads on corporate bonds, asset-backed and mortgage-backed
securities tightened from historically wide levels in the fall of 1998. Since
that time, we selectively increased the Fund's exposure to these sectors. With
the spreads contracting, these sectors have contributed positively to the
performance of the Fund over the past year.
CORPORATE BONDS
The Fund's careful, research-intensive process of selecting investment-grade
corporate issues, asset-backed securities and mortgages gives the Fund a high-
quality focus. Currently the Fund's exposure to the corporate sector represents
56%. Sectors of the corporate market that we continue to favor include finance,
banking and brokerage.
MORTGAGE-BACKED AND ASSET-BACKED SECURITIES
In general, we purchase only the highest rated (Aaa and Agency) collateralized
mortgage obligations (CMOs) and asset-backed securities (ABS). We utilize
shorter duration structures with more predictable "cash flow" characteristics.
This restrained use of mortgage and ABS instruments is a by-product of our
requirement to precisely measure the duration of the portfolio and ensure we
"match" the duration of the benchmark index at all times. The Firstar
Intermediate Bond Market Fund currently invests 22% in mortgage- and asset-
backed securities.
CONSISTENCY IS THE HALLMARK OF OUR APPROACH
Since Firstar Intermediate Bond Market Fund's inception on 1/5/93, we have
adhered to the same disciplined management approach. During the past 6+ years
the financial markets have become more volatile. THE HALLMARK OF OUR APPROACH
HAS BEEN THE FUND'S CONSISTENT PERFORMANCE IN ALL MARKET CLIMATES. Firstar
Intermediate's returns have been comparable to the benchmark in periods of
rising interest rates and falling interest rates. Our goal is to continue to
deliver this same consistent performance in the future.
We look forward to continuing to serve you as a Firstar Fund shareholder.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
(PHOTO) (PHOTO)
MARY ELLEN STANEK, CFA WARREN D. PIERSON, CFA
MARY ELLEN STANEK, CFA, President and Chief Executive Officer of Firstar
Investment Research &Management Company, LLC (FIRMCO) and WARREN D. PIERSON,
CFA, Senior Vice President and Senior Portfolio Manager co-manage the Fund, Mary
Ellen since its inception on January 5, 1993 and Warren since March 1, 1999.
Mary Ellen has 21 years of investment management experience and was named a
Director of FIRMCO in 1992 and President in 1994. Prior to joining FIRMCO, she
headed the Fixed Income and Quantitative Investment Management Department at
Firstar Trust Company. Mary Ellen received her BA from Marquette University in
1978 and her MBA from the University of Wisconsin-Milwaukee in 1984. Warren has
been with Firstar since 1985 and has 14 years of investment management
experience. He received his BA from Lawrence University in 1984. Mary Ellen and
Warren are both Chartered Financial Analysts.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR INTERMEDIATE LEHMAN BROTHERS
BOND MARKET FUND - INTERMEDIATE
INSTITUTIONAL GOV'T./CORP. BOND <F4>
---------------------- ----------------------
1/5/93 10,000 10,000
10/93 10,858 10,844
10/94 10,670 10,635
10/95 11,978 11,968
10/96 12,669 12,663
10/97 13,602 13,612
10/98 14,665 14,853
10/99 14,946 15,000
This chart assumes an initial investment of $10,000 made on 1/5/93 (inception).
Performance reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced. Performance is shown for Institutional shares, which
have lower expenses than Series A or Series B shares. If those fees and expenses
were reflected in the chart above, total return would have been reduced. Returns
shown include the reinvestment of all dividends and other distributions. Past
performance is not predictive of future performance. Investment return and
principal value will fluctuate, so that your shares, when redeemed, may be worth
more or less than their original cost.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR YEARS ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
1 3 5
Year Years Years Since Inception
- --------------------------------------------------------------------------------
FIRSTAR INTERMEDIATE BOND
MARKET FUND - INSTITUTIONAL 1.9 5.7 7.0 6.1 (1/5/93)
FIRSTAR INTERMEDIATE BOND
MARKET FUND - A - NO LOAD 1.7 5.4 6.7 5.9 (1/5/93)
FIRSTAR INTERMEDIATE
BOND MARKET FUND - A - LOAD<F2> (2.2) 4.1 5.9 5.3 (1/5/93)
FIRSTAR INTERMEDIATE BOND
MARKET FUND - B - NO LOAD - - - 1.0 (3/1/99)<F1>
FIRSTAR INTERMEDIATE BOND
MARKET FUND - B - LOAD<F3> - - - (4.0) (3/1/99)<F1>
LEHMAN BROTHERS INTERMEDIATE
GOV'T./CORP. BOND INDEX<F4> 1.0 5.8 7.1 6.1 (1/5/93)
- --------------------------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1, 1999 to October 31, 1999 is
not annualized.
<F2> Reflects maximum sales charge of 3.75%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The Lehman Brothers Intermediate Gov't./Corp. Bond Index is an unmanaged
market value weighted index measuring both principal price changes of, and
income provided by, the underlying universe of securities that comprise the
index. Securities included in the index must meet the following critieria:
fixed as opposed to variable rate; remaining maturity of one to ten years;
minimum outstanding par value of $100 million; and rated investment grade
or higher by Moody's, Standard & Poor's, or Fitch, in that order. An
investment cannot be made directly in an index.
The Lehman Brothers 1-3 Year Government/Corporate Bond Index, the Lehman
Brothers Intermediate Government/Corporate Bond Index and the Lehman Brothers
Government/Corporate Bond Index are trademarks of Lehman Brothers. The Fund, its
Adviser and the Co-Administrators are not affiliated in any way with Lehman
Brothers. Inclusion of a security in a bond index in no way implies an opinion
by Lehman Brothers as to its attractiveness or appropriateness as an investment.
Lehman Brothers' publication of the bond index is not made in connection with
any sale or offer for sale of securities or any solicitation of orders for the
purchase of securities.
Effective at the close of business January 9, 1995, Firstar Funds began to offer
Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 3.75%
maximum sales load and are subject to an annual 0.25% service organization fee.
The load performance for the Series A shares has been restated to reflect the
impact of the current sales charge. Series A performance prior to January 10,
1995, does not reflect the service organization fees. If service organization
fees had been reflected, performance would be reduced. Series B shares have a
5.00% maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
SECTOR DISTRIBUTION
10/31/99
- -----------------------------------
U.S. TREASURY 18%
- -----------------------------------
U.S. GOVERNMENT AGENCY 0%
- -----------------------------------
MORTGAGE-BACKED<F1> 6%
- -----------------------------------
FINANCE, BANKING, BROKERAGE 33%
- -----------------------------------
INDUSTRIAL 9%
- -----------------------------------
UTILITY 3%
- -----------------------------------
INTERNATIONAL/YANKEE 11%
- -----------------------------------
ASSET-BACKED 16%
- -----------------------------------
CASH AND OTHER 4%
- -----------------------------------
TOTAL 100%
- -----------------------------------
PORTFOLIO COMPOSITION
10/31/99
- -----------------------------------
AVERAGE MATURITY 5.5 YEARS
- -----------------------------------
AVERAGE DURATION 3.4 YEARS
- -----------------------------------
<F1> incl. U.S. Gov't. Agency-Backed
QUALITY DISTRIBUTION
10/31/99
- -----------------------------------
U.S. TREASURY 18%
- -----------------------------------
U.S. GOVERNMENT AGENCY 3%
- -----------------------------------
Aaa 24%
- -----------------------------------
Aa 8%
- -----------------------------------
A 28%
- -----------------------------------
Baa 19%
- -----------------------------------
Ba 0%
- -----------------------------------
TOTAL 100%
- -----------------------------------
SEC 30-DAY YIELD
- -----------------------------------
INSTITUTIONAL 6.37%
- -----------------------------------
A - NO LOAD 6.11%
- -----------------------------------
A - LOAD 5.88%
- -----------------------------------
B - NO LOAD 5.36%
- -----------------------------------
TOTAL FUND NET ASSETS
10/31/99
- -----------------------------------
$318,031,682
- -----------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
- --------------------------------------------------------------------------------
TAX-EXEMPT INTERMEDIATE BOND FUND
- --------------------------------------------------------------------------------
FIRSTAR TAX-EXEMPT INTERMEDIATE BOND FUND seeks to provide current income exempt
from federal taxes and emphasizes total return with relatively low volatility of
principal. In order to achieve its objective, the Fund may invest in securities
with long remaining maturities (10 years or longer) in addition to shorter bonds
and notes. Currently the Fund does not purchase any issues which are subject to
the alternative minimum tax.
This Fund's maturity mix gives it an overall AVERAGE PORTFOLIO MATURITY OF 5.0
YEARS and a DURATION OF 4.1 YEARS. Because Tax-Exempt Intermediate Bond Fund's
duration is approximately four years, its NAV will be less price sensitive to
changes in interest rates than the typical municipal debt fund which, according
to Lipper Analytical Services, has an average duration of 7.8 years. The
intermediate average maturity and duration of this Fund protected the Fund from
the rise in interest rates over the last twelve months. While the Fund's
duration is the single most significant determinant of its return, the Fund's
sector allocation is also important. The Fund continues to emphasize high
quality holdings, favoring prerefunded, noncallable issues with predictable cash
flows.
PREREFUNDED MUNICIPAL BONDS
Prerefunded municipal bonds are municipal bonds that hold U.S. Treasury issues
in an escrow account, assuring the timely repayment of interest and principal.
As of October 31, 1999, OVER 68% OF THE FUND'S HOLDINGS WERE INVESTED IN
PREREFUNDED MUNICIPAL BONDS, RESULTING IN AN AVERAGE CREDIT QUALITY RATING OF
AAA FOR THE FUND. With credit spreads in the municipal bond market remaining
tight, the Fund's focus on superior quality issues will help minimize the
effects of any widening of credit spreads and will protect the Fund from any
general deterioration of credit quality in the municipal bond market.
CONSISTENCY IS THE HALLMARK OF OUR APPROACH
Since Firstar Tax-Exempt Intermediate Bond Fund's inception on 2/8/93, we have
adhered to the same disciplined management approach. The past 6+ years have
brought us more volatility in the fixed-income markets than many would have
expected. THE HALLMARK OF OUR APPROACH HAS BEEN THE FUND'S CONSISTENT
PERFORMANCE IN ALL MARKET CLIMATES. Our goal is to continue to deliver this same
consistent performance in the future.
We look forward to continuing to serve you as a Firstar Fund shareholder.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
(PHOTO)
WARREN D. PIERSON, CFA
WARREN D. PIERSON, CFA, Vice President and Senior Portfolio Manager of Firstar
Investment Research &Management Company, LLC (FIRMCO) has managed the Fund since
June 22, 1993. Warren has been with Firstar since 1985 and has 14 years of
investment management experience. He received his BA from Lawrence University in
1984. Warren is a Chartered Financial Analyst.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR LEHMAN BROTHERS
TAX-EXEMPT 5-YEAR GENERAL
INTERMEDIATE OBLIGATION
BOND FUND BOND INDEX <F4>
---------------------- ----------------------
2/8/93 10,000 10,000
10/93 10,536 10,557
10/94 10,459 10,499
10/95 11,440 11,586
10/96 11,900 12,143
10/97 12,609 12,934
10/98 13,351 13,777
10/99 13,403 13,927
This chart assumes an initial investment of $10,000 made on 2/8/93 (inception).
Per formance reflects fee waivers in effect. In the absence of fee waivers,
total return would be reduced. Performance is shown for Institutional shares,
which have lower expenses than Series A or Series B shares. If those fees and
expenses were reflected in the chart above, total return would have been
reduced. Returns shown include the reinvestment of all dividends and other
distributions. Past performance is not predictive of future performance.
Investment return and principal value will fluctuate, so that your shares, when
redeemed, may be worth more or less than their original cost.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR YEARS ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
1 3 5
Year Years Years Since Inception
- --------------------------------------------------------------------------------
FIRSTAR TAX-EXEMPT INTERMEDIATE
BOND FUND - INSTITUTIONAL 0.4 4.0 5.1 4.5 (2/8/93)
FIRSTAR TAX-EXEMPT INTERMEDIATE
BOND FUND - A - NO LOAD 0.1 3.8 4.8 4.3 (2/8/93)
FIRSTAR TAX-EXEMPT INTERMEDIATE
BOND FUND - A - LOAD<F2> (3.6) 2.4 4.0 3.6 (2/8/93)
FIRSTAR TAX-EXEMPT INTERMEDIATE
BOND FUND - B - NO LOAD - - - (1.6) (3/1/99)<F1>
FIRSTAR TAX-EXEMPT INTERMEDIATE
BOND FUND - B - LOAD<F3> - - - (6.4) (3/1/99)<F1>
LEHMAN BROTHERS 5 YEAR GENERAL
OBLIGATION BOND INDEX<F4> 1.1 4.7 5.8 5.1 (2/8/93)
- --------------------------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1, 1999 to October 31, 1999 is
not annualized.
<F2> Reflects maximum sales charge of 3.75%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The Lehman Brothers 5 Year General Obligation Bond Index, an unmanaged
index, is a total return performance benchmark for the investment-grade
tax-exempt bond market. To be included in this index, a municipal bond must
be a state or local General Obligation bond; have a minimum credit rating
of at least Baa; have been issued as part of an offering of at least $50
million; have a maturity amount outstanding of at least $3 million; have
been issued within the last five years; and have a maturity of 4 to 6
years. An investment cannot be made directly in an index.
The Lehman Brothers 1-3 Year Government/Corporate Bond Index, the Lehman
Brothers Intermediate Government/Corporate Bond Index and the Lehman Brothers
Government/Corporate Bond Index are trademarks of Lehman Brothers. The Fund, its
Adviser and the Co-Administrators are not affiliated in any way with Lehman
Brothers. Inclusion of a security in a bond index in no way implies an opinion
by Lehman Brothers as to its attractiveness or appropriateness as an investment.
Lehman Brothers' publication of the bond index is not made in connection with
any sale or offer for sale of securities or any solicitation of orders for the
purchase of securities.
Effective at the close of business January 9, 1995, Firstar Funds began to offer
Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 3.75%
maximum sales load and are subject to an annual 0.25% service organization fee.
The load performance for the Series A shares has been restated to reflect the
impact of the current sales charge. Series A performance prior to January 10,
1995, does not reflect the service organization fees. If service organization
fees had been reflected, performance would be reduced. Series B shares have a
5.00% maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
SECTOR DISTRIBUTION
10/31/99
- -----------------------------------
GENERAL OBLIGATIONS 8%
- -----------------------------------
ESCROWED/PREREFUNDED 68%
- -----------------------------------
INSURED 18%
- -----------------------------------
REVENUE 3%
- -----------------------------------
CASH AND OTHER 3%
- -----------------------------------
TOTAL 100%
- -----------------------------------
QUALITY DISTRIBUTION
10/31/99
- -----------------------------------
Aaa 89%
- -----------------------------------
Aa 11%
- -----------------------------------
TOTAL 100%
- -----------------------------------
PORTFOLIO COMPOSITION
10/31/99
- -----------------------------------
AVERAGE MATURITY 5.0 YEARS
- -----------------------------------
AVERAGE DURATION 4.1 YEARS
- -----------------------------------
SEC 30-DAY YIELD
- -----------------------------------
INSTITUTIONAL 4.19%
- -----------------------------------
A - NO LOAD 3.94%
- -----------------------------------
A - LOAD 3.79%
- -----------------------------------
B - NO LOAD 3.19%
- -----------------------------------
TOTAL FUND NET ASSETS
10/31/99
- -----------------------------------
$85,123,822
- -----------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
- --------------------------------------------------------------------------------
BOND IMMDEX/TM FUND
- --------------------------------------------------------------------------------
FIRSTAR BOND IMMDEXTM FUND seeks to provide an annual rate of total return
comparable to that of the Lehman Brothers Government/Corporate Bond Index,
before Fund expenses. In order to achieve its objective, the Fund may invest in
securities with very long remaining maturities (30 years or longer) in addition
to shorter bonds and notes.
INTEREST RATE RISK
This Fund's maturity mix gives the portfolio an overall AVERAGE MATURITY OF 10.3
YEARS and a DURATION OF 5.4 YEARS. Since the Bond IMMDEXTM Fund's duration is
just over five years, it is the longest of all the Firstar taxable bond funds
and will display the greatest downward price movement when interest rates
increase, but will exhibit the greatest upward price movement when interest
rates decrease. While the Fund's duration is the single most significant
determinant of its return, the Fund's allocation to the following sectors is
also important.
During 1999, spreads on corporate bonds, asset-backed and mortgage-backed
securities tightened from historically wide levels in the fall of 1998. Since
that time, we selectively increased the Fund's exposure to these sectors. With
the spreads contracting, these sectors have contributed positively to the
performance of the Fund over the past year.
CORPORATE BONDS
The Fund's careful, research-intensive process of selecting investment-grade
corporate issues and mortgage securities gives the Fund a high-quality focus.
Currently the Fund's exposure to the corporate sector represents 60%. Sectors of
the corporate market that we continue to favor include finance, banking,
brokerage and dollar-denominated Yankees.
MORTGAGE-BACKED AND ASSET-BACKED SECURITIES
In general, we purchase only the highest rated (Aaa and Agency) collateralized
mortgage obligations (CMOs) and asset-backed securities (ABS). We utilize
shorter duration structures with more predictable "cash flow" characteristics.
This restrained use of mortgage- and asset-backed instruments is a by-product of
our requirement to precisely measure the duration of the portfolio and ensure we
"match" the duration of the benchmark index at all times. The Bond IMMDEXTM Fund
currently invests 10% in mortgages and asset-backed securities.
CONSISTENCY IS THE HALLMARK OF OUR APPROACH
Since Firstar Bond IMMDEXTM Fund's inception on 12/29/89, we have adhered to the
same disciplined management approach. During the past 9+ years the financial
markets have become more volatile. THE HALLMARK OF OUR APPROACH HAS BEEN THE
FUND'S CONSISTENT PERFORMANCE IN ALL MARKET CLIMATES. Firstar Bond IMMDEX/TM's
returns have been comparable to the benchmark in periods of rising interest
rates and falling interest rates. Our goal is to continue to deliver this same
consistent performance in the future.
We look forward to continuing to serve you as a Firstar Fund shareholder.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
(PHOTO) (PHOTO)
MARY ELLEN STANEK, CFA DANIEL TRANCHITA, CFA
MARY ELLEN STANEK, CFA, President and Chief Executive Officer of Firstar
Investment Research &Management Company, LLC (FIRMCO) and DANIEL A. TRANCHITA,
CFA, Senior Vice President and Senior Portfolio Manager co-manage the Fund _
Mary Ellen since its inception on December 29, 1989 and Dan since March 1, 1999.
Mary Ellen has 21 years of investment management experience and was named a
Director of FIRMCO in 1992 and President in 1994. Prior to joining FIRMCO, she
headed the Fixed Income and Quantitative Investment Management Department at
Firstar Trust Company. Mary Ellen received her BA from Marquette University in
1978 and her MBA from the University of Wisconsin-Milwaukee in 1984. Dan has
been with Firstar since 1989 and has 10 years of investment management
experience. Dan received his BA in 1987 and his MBA in 1989 from Marquette
University. Mary Ellen and Dan are both Chartered Financial Analysts.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR LEHMAN BROTHERS
IMMDEX/TM FUND - GOVERNEMENT/CORP.
INSTITUTIONAL BOND INDEX <F4>
---------------------- ----------------------
12/29/89 10,000 10,000
10/90 10,421 10,440
10/91 12,105 12,045
10/92 13,376 13,312
10/93 15,154 15,126
10/94 14,565 14,424
10/95 16,934 16,755
10/96 17,840 17,658
10/97 19,428 19,214
10/98 21,256 21,189
10/99 21,298 21,049
This chart assumes an initial investment of $10,000 made on 12/29/89
(inception). Per form ance reflects fee waivers in effect. In the absence of fee
waivers, total return would be reduced. Performance is shown for Institutional
shares, which have lower expenses than Series A or Series B shares. If those
fees and expenses were reflected in the chart above, total return would have
been reduced. Returns shown include the reinvestment of all dividends and other
distributions. Past performance is not predictive of future performance.
Investment return and principal value will fluctuate, so that your shares, when
redeemed, may be worth more or less than their original cost.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR YEARS ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
1 3 5
Year Years Years Since Inception
- --------------------------------------------------------------------------------
FIRSTAR BOND IMMDEXTM FUND -
INSTITUTIONAL 0.2 6.1 7.9 8.0 (12/29/89)
FIRSTAR BOND IMMDEXTM FUND -
A - NO LOAD (0.1) 5.8 7.6 7.9 (12/29/89)
FIRSTAR BOND IMMDEXTM FUND -
A - LOAD<F2> (3.8) 4.5 6.8 7.4 (12/29/89)
FIRSTAR BOND IMMDEXTM FUND -
B - NO LOAD - - - 0.0 (3/1/99)<F1>
FIRSTAR BOND IMMDEXTM FUND -
B - LOAD<F3> - - - (5.0) (3/1/99)<F1>
LEHMAN BROTHERS GOV'T/CORP.
BOND INDEX<F4> (0.7) 6.0 7.9 7.8 (12/29/89)
- --------------------------------------------------------------------------------
A = Series A (retail class)
B = Series B (retail class)
<F1> Series B performance for the period March 1, 1999 to October 31, 1999 is
not annualized.
<F2> Reflects maximum sales charge of 3.75%.
<F3> Reflects maximum deferred sales charge of 5.00%.
<F4> The Lehman Brothers Gov't/Corp. Bond is an unmanaged market value weighted
index measuring both principal price changes of, and income provided by,
the underlying universe of securities that comprise the index. Securities
included in the index must meet the following criteria: fixed as opposed to
variable rate; not less than one year to maturity; minimum outstanding par
value of $100 million; and rated investment grade or higher by Moody's,
Standard & Poor's, or Fitch, in that order. An investment cannot be made
directly in an index.
The Lehman Brothers 1-3 Year Government/Corporate Bond Index, the Lehman
Brothers Intermediate Government/Corporate Bond Index and the Lehman Brothers
Government/Corporate Bond Index are trademarks of Lehman Brothers. The Fund, its
Adviser and the Co-Administrators are not affiliated in any way with Lehman
Brothers. Inclusion of a security in a bond index in no way implies an opinion
by Lehman Brothers as to its attractiveness or appropriateness as an investment.
Lehman Brothers' publication of the bond index is not made in connection with
any sale or offer for sale of securities or any solicitation of orders for the
purchase of securities.
Effective at the close of business January 9, 1995, Firstar Funds began to offer
Series A shares. Effective at the close of business on February 28, 1999,
Firstar Funds began to offer Series B shares. Series A shares have a 3.75%
maximum sales load and are subject to an annual 0.25% service organization fee.
The load performance for the Series A shares has been restated to reflect the
impact of the current sales charge. Series A performance prior to January 10,
1995, does not reflect the service organization fees. If service organization
fees had been reflected, performance would be reduced. Series B shares have a
5.00% maximum deferred sales charge and are subject to an annual 0.25% service
organization fee and an annual 0.75% 12b-1 fee. Performance for all share
classes reflects fee waivers in effect. In the absence of fee waivers, total
return would be reduced.
SECTOR DISTRIBUTION
10/31/99
- -----------------------------------
U.S. TREASURY 26%
- -----------------------------------
U.S. GOVERNMENT AGENCY 0%
- -----------------------------------
MORTGAGE-BACKED<F1> 6%
- -----------------------------------
FINANCE, BANKING, BROKERAGE 24%
- -----------------------------------
INDUSTRIAL 16%
- -----------------------------------
UTILITY 5%
- -----------------------------------
INTERNATIONAL/YANKEE 15%
- -----------------------------------
ASSET-BACKED 4%
- -----------------------------------
CASH 4%
- -----------------------------------
TOTAL 100%
- -----------------------------------
PORTFOLIO DISTRIBUTION
10/31/99
- -----------------------------------
AVERAGE MATURITY 10.3 YEARS
- -----------------------------------
AVERAGE DURATION 5.4 YEARS
- -----------------------------------
<F1> incl. U.S. Gov't. Agency-Backed
QUALITY DISTRIBUTION
10/31/99
- -----------------------------------
U.S. TREASURY 26%
- -----------------------------------
U.S. GOVERNMENT AGENCY 6%
- -----------------------------------
Aaa 8%
- -----------------------------------
Aa 7%
- -----------------------------------
A 26%
- -----------------------------------
Baa 27%
- -----------------------------------
Ba 0%
- -----------------------------------
TOTAL 100%
- -----------------------------------
SEC 30-DAY YIELD
- -----------------------------------
INSTITUTIONAL 6.68%
- -----------------------------------
A - NO LOAD 6.43%
- -----------------------------------
A - LOAD 6.18%
- -----------------------------------
B - NO LOAD 5.67%
- -----------------------------------
TOTAL FUND NET ASSETS
10/31/99
- -----------------------------------
$519,401,241
- -----------------------------------
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF ASSETS AND LIABILITIES
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
OCTOBER 31, 1999
SHORT- TAX-
TERM INTERMEDIATE EXEMPT
BOND BOND INTERMEDIATE BOND
MARKET MARKET BOND IMMDEX/TM
FUND FUND FUND FUND
--------- --------- --------- ---------
ASSETS:
Investments, at value (cost
$194,547, $317,451, $84,846 and
$503,110, respectively) $192,888 $314,762 $ 83,483 $508,130
Cash 850 - 1 -
Interest receivable 2,486 5,140 1,565 9,934
Capital shares sold 1,739 125 156 3,324
Receivable for securities sold - - - 5,086
Other assets 14 17 19 13
--------- --------- --------- ---------
Total Assets 197,977 320,044 85,224 526,487
--------- --------- --------- ---------
LIABILITIES:
Payable for securities purchased 821 1,160 - 5,000
Capital shares redeemed 369 619 25 1,109
Payable to affiliates 129 199 63 282
Accrued expenses and
other liabilities 40 34 12 695
--------- --------- --------- ---------
Total Liabilities 1,359 2,012 100 7,086
--------- --------- --------- ---------
NET ASSETS $196,618 $318,032 $ 85,124 $519,401
========= ========= ========= =========
NET ASSETS CONSIST OF:
Capital stock $201,174 $320,682 $ 86,163 $514,269
Undistributed net
investment income 120 220 33 377
Undistributed accumulated
net realized gains (losses) (3,017) (181) 291 (265)
Unrealized net appreciation
(depreciation) on investments (1,659) (2,689) (1,363) 5,020
--------- --------- --------- ---------
Total Net Assets $196,618 $318,032 $ 85,124 $519,401
========= ========= ========= =========
SERIES A:
Net assets $ 65,490 $ 33,779 $ 20,016 $ 95,635
Shares authorized
($.0001 par value) 500,000 500,000 500,000 500,000
Shares issued and outstanding 6,470 3,346 1,978 3,495
Net asset value and redemption
price per share <F1> $10.12 $10.10 $10.12 $27.36
========= ========= ========= =========
Maximum offering price
per share <F1> $10.51 $10.49 $10.51 $28.43
========= ========= ========= =========
SERIES B:
Net assets $ 517 $ 206 $ 74 $ 1,869
Shares authorized
($.0001 par value) 500,000 500,000 500,000 500,000
Shares issued and outstanding 51 20 7 68
Net asset value, redemption price
and offering price
per share <F1> $10.12 $10.09 $10.12 $27.36
========= ========= ========= =========
SERIES INSTITUTIONAL:
Net assets $130,611 $284,047 $ 65,034 $421,897
Shares authorized
($.0001 par value) 500,000 500,000 500,000 500,000
Shares issued and outstanding 12,902 28,135 6,428 15,412
Net asset value, redemption price
and offering price
per share <F1> $10.12 $10.10 $10.12 $27.37
========= ========= ========= =========
<F1> Amounts may not recalculate due to rounding.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
SHORT-TERM INTERMEDIATE TAX-EXEMPT BOND
BOND MARKET BOND MARKET INTERMEDIATE BOND IMMDEX/TM
FUND FUND FUND FUND
------------------ ------------------ ------------------ ------------------
Year Year Year Year Year Year Year Year
ended ended ended ended ended ended ended ended
Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
1999 1998 1999 1998 1999 1998 1999 1998
-------- -------- -------- -------- -------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income $ 11,031 $10,479 $18,045 $ 17,094 $3,948 $3,552 $31,584 $ 31,019
Net realized gain (loss) on investments (684) 309 (230) 1,171 293 130 (54) 512
Net change in unrealized appreciation
(depreciation) on investments (3,714) 920 (11,981) 4,459 (3,854) 1,175 (30,858) 15,260
-------- -------- -------- -------- -------- -------- -------- --------
Net increase in net assets
resulting from operations 6,633 11,708 5,834 22,724 387 4,857 672 46,791
-------- -------- -------- -------- -------- -------- -------- --------
CAPITAL SHARE TRANSACTIONS:
Shares sold 53,639 77,282 71,398 93,944 30,647 58,804 191,150 188,904
Shares issued to owners in
reinvestment of dividends 8,699 8,368 10,859 9,710 1,857 1,623 24,755 25,524
Shares redeemed (57,459) (92,444) (72,617) (63,716) (42,638) (34,259) (232,395) (135,752)
-------- -------- -------- -------- -------- -------- -------- --------
Net increase (decrease) in net assets resulting
from capital share transactions 4,879 (6,794) 9,640 39,938 (10,134) 26,168 (16,490) 78,676
-------- -------- -------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO SERIES A
SHAREHOLDERS:
From net investment income <F1> (3,882) (3,882) (1,821) (1,379) (1,181) (991) (5,786) (4,535)
From net realized gains - - (30) - (29) - - -
-------- -------- -------- -------- -------- -------- -------- --------
(3,882) (3,882) (1,851) (1,379) (1,210) (991) (5,786) (4,535)
-------- -------- -------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO SERIES B
SHAREHOLDERS:
From net investment income <F1> (12) - (5) - (1) - (44) -
From net realized gains - - - - - - - -
-------- -------- -------- -------- -------- -------- -------- --------
(12) - (5) - (1) - (44) -
-------- -------- -------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO SERIES
INSTITUTIONAL SHAREHOLDERS:
From net investment income <F1> (7,103) (6,580) (16,154) (15,656) (2,759) (2,548) (25,677) (26,368)
From net realized gains - - (271) - (52) - - -
-------- -------- -------- -------- -------- -------- -------- --------
(7,103) (6,580) (16,425) (15,656) (2,811) (2,548) (25,677) (26,368)
-------- -------- -------- -------- -------- -------- -------- --------
TOTAL INCREASE (DECREASE)IN NET ASSETS 515 (5,548) (2,807) 45,627 (13,769) 27,486 (47,325) 94,564
NET ASSETS:
Beginning of year 196,103 201,651 320,839 275,212 98,893 71,407 566,726 472,162
-------- -------- -------- -------- -------- -------- -------- --------
End of year (including undistributed net
investment income of $120, $85, $220, $156,
$33, $26, $377, and $292, respectively) $196,618 $196,103 $318,032 $320,839 $ 85,124 $98,893 $519,401 $566,726
======== ======== ======== ======== ======== ======== ======== ========
</TABLE>
<F1> For the Tax-Exempt Intermediate Bond Fund, substantially all distributions
from net investment income are exempt from federal income tax.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF OPERATIONS
(AMOUNTS IN THOUSANDS)
YEAR ENDED OCTOBER 31, 1999
SHORT- TAX-
TERM INTERMEDIATE EXEMPT
BOND BOND INTERMEDIATE BOND
MARKET MARKET BOND IMMDEX/TM
FUND FUND FUND FUND
--------- --------- --------- ---------
INVESTMENT INCOME:
Interest income $12,351 $19,898 $4,642 $34,322
EXPENSES:
Investment advisory fees 1,219 1,587 484 1,578
Administration fees 218 341 104 566
Transfer agent fees and expenses 40 46 40 56
Fund accounting fees 86 110 61 130
Service organization fees - Series A 186 84 77 250
Service organization fees - Series B 1 0 0 2
12b-1 fees - Series B 2 1 0 6
Custody fees 29 47 20 73
Federal and state registration fees 27 33 31 39
Professional fees 40 41 38 44
Reports to shareholders 26 10 6 42
Directors' fees and expenses 7 7 7 8
Other 7 8 3 15
------- -------- -------- --------
Total expenses before waiver 1,888 2,315 871 2,809
Less: Waiver of expenses (568) (462) (177) (71)
------- -------- -------- --------
Net expenses 1,320 1,853 694 2,738
NET INVESTMENT INCOME 11,031 18,045 3,948 31,584
------- -------- -------- --------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on
investment transactions (684) (230) 293 (54)
Net change in unrealized
depreciation on investments (3,714) (11,981) (3,854) (30,858)
------- -------- -------- --------
Net loss on investments (4,398) (12,211) (3,561) (30,912)
------- -------- -------- --------
NET INCREASEIN NET ASSETS
RESULTING FROM OPERATIONS $ 6,633 $ 5,834 $387 $672
======= ======= ======= =======
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
This page intentionally left blank.
<PAGE>
(LOGO) FIRSTAR FUNDS
FINANCIAL HIGHLIGHTS
INSTITUTIONAL BOND FUNDS
Income from
Investment Operations
---------------------------------
Net
Realized
and
Net Unrealized
Asset Gains Total
Value, Net or (Losses) From
Beginning Investment on Investment
PER SHARE DATA of Period Income<F1> Securities Operations
- -----------------------------------------------------------------------------
SHORT-TERM BOND MARKET
- -----------------------------------------------------------------------------
Year Ended October 31, 1995<F6> $10.03 $0.63 $ 0.24 $0.87
- -----------------------------------------------------------------------------
Year Ended October 31, 1996 10.28 0.61<F7> (0.03) 0.58
- -----------------------------------------------------------------------------
Year Ended October 31, 1997 10.25 0.62 0.02 0.64
- -----------------------------------------------------------------------------
Year Ended October 31, 1998 10.27 0.61 0.07 0.68
- -----------------------------------------------------------------------------
Year Ended October 31, 1999 10.34 0.56 (0.22) 0.34
- -----------------------------------------------------------------------------
INTERMEDIATE BOND MARKET
- -----------------------------------------------------------------------------
Year Ended October 31, 1995<F6> 9.67 0.62 0.53 1.15
- -----------------------------------------------------------------------------
Year Ended October 31, 1996 10.21 0.59<F7> (0.02) 0.57
- -----------------------------------------------------------------------------
Year Ended October 31, 1997 10.19 0.60 0.12 0.72
- -----------------------------------------------------------------------------
Year Ended October 31, 1998 10.31 0.59 0.19 0.78
- -----------------------------------------------------------------------------
Year Ended October 31, 1999 10.50 0.59 (0.39) 0.20
- -----------------------------------------------------------------------------
TAX-EXEMPT INTERMEDIATE BOND
- -----------------------------------------------------------------------------
Year Ended October 31, 1995<F6> 9.78 0.44 0.46 0.90
- -----------------------------------------------------------------------------
Year Ended October 31, 1996 10.24 0.43<F7> (0.03) 0.40
- -----------------------------------------------------------------------------
Year Ended October 31, 1997 10.21 0.44 0.15 0.59
- -----------------------------------------------------------------------------
Year Ended October 31, 1998 10.36 0.44 0.16 0.60
- -----------------------------------------------------------------------------
Year Ended October 31, 1999 10.52 0.44 (0.40) 0.04
- -----------------------------------------------------------------------------
BOND IMMDEX/TM
- -----------------------------------------------------------------------------
Year Ended October 31, 1995<F6> 25.67 1.74 2.29 4.03
- -----------------------------------------------------------------------------
Year Ended October 31, 1996 27.82 1.70<F7> (0.27) 1.43
- -----------------------------------------------------------------------------
Year Ended October 31, 1997 27.55 1.75 0.61 2.36
- -----------------------------------------------------------------------------
Year Ended October 31, 1998 28.16 1.72 0.85 2.57
- -----------------------------------------------------------------------------
Year Ended October 31, 1999 29.02 1.70 (1.65) 0.05
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
Less Distributions Supplemental Data and Ratios
--------------------------------- --------------------------------------------
Ratio
Ratio of Net
Dividends Net Net of Net Investment
from Distributions Asset Assets, Expenses Income Portfolio
Net From Value, End of to Average to Average Turnover
Investment Capital Total End of Total Period Net Net Rate
PER SHARE DATA Income Gains Distributions Period Return (000s) Assets Assets <F8>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHORT-TERM BOND MARKET
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F6> $(0.62) $ - $(0.62) $10.28 8.95% $ 94,959 0.50<F2> 6.23<F2> 100.58%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.61) - (0.61) 10.25 5.80% 147,466 0.50<F2> 5.92<F2> 59.62%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.62) - (0.62) 10.27 6.47% 136,084 0.50<F2> 6.04<F2> 77.12%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.61) - (0.61) 10.34 6.84% 120,693 0.50<F2> 5.92<F2> 78.20%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.56) - (0.56) 10.12 3.42% 130,611 0.56<F2> 5.52<F2> 52.28%
- ------------------------------------------------------------------------------------------------------------------------------------
INTERMEDIATE BOND MARKET
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F6> (0.61) - (0.61) 10.21 12.25% 128,941 0.50<F3> 6.26<F3> 66.69%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.59) - (0.59) 10.19 5.77% 173,468 0.50<F3> 5.84<F3> 59.29%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.60) - (0.60) 10.31 7.36% 254,521 0.50<F3> 5.96<F3> 40.61%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.59) - (0.59) 10.50 7.83% 291,289 0.50<F3> 5.75<F3> 27.29%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.59) (0.01) (0.60) 10.10 1.91% 284,047 0.56<F3> 5.71<F3> 64.07%
- ------------------------------------------------------------------------------------------------------------------------------------
TAX-EXEMPT INTERMEDIATE BOND
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F6> (0.44) - (0.44) 10.24 9.38% 27,595 0.51<F4> 4.45<F4> 44.13%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.43) - (0.43) 10.21 4.02% 36,652 0.50<F4> 4.24<F4> 30.46%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.44) - (0.44) 10.36 5.96% 52,208 0.50<F4> 4.36<F4> 11.22%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.44) - (0.44) 10.52 5.88% 66,427 0.50<F4> 4.25<F4> 14.38%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.43) (0.01) (0.44) 10.12 0.39% 65,034 0.64<F4> 4.16<F4> 21.77%
- ------------------------------------------------------------------------------------------------------------------------------------
BOND IMMDEX/TM
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F6> (1.84) (0.04) (1.88) 27.82 16.26% 290,274 0.44<F5> 6.51<F5> 41.67%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (1.70) - (1.70) 27.55 5.35% 370,556 0.43<F5> 6.23<F5> 33.38%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (1.75) - (1.75) 28.16 8.90% 408,018 0.42<F5> 6.33<F5> 35.12%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (1.71) - (1.71) 29.02 9.41% 471,425 0.42<F5> 6.02<F5> 20.07%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (1.70) - (1.70) 27.37 0.20% 421,897 0.47<F5> 6.05<F5> 57.04%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> For the Tax-Exempt Intermediate Bond Fund, substantially all investment
income is exempt from federal income tax.
<F2> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.84%, 0.86%, 0.86%, 0.87%, 0.91%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 5.24%, 5.56%, 5.68%,
5.55%, 5.82%, respectively.
<F3> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.70%, 0.71%, 0.73%, 0.74%, 0.79%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 5.57%, 5.54%, 5.73%,
5.60%, 5.97%, respectively.
<F4> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.82%, 0.81%, 0.88%, 0.97%, 1.00%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 3.98%, 3.94%, 3.98%,
3.77%, 3.96%, respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.48%, 0.49%, 0.49%, 0.50%, 0.51%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 6.04%, 5.95%, 6.26%,
6.16%, 6.44%, respectively.
<F6> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareowners exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of the
close of business on January 9, 1995, and the results thereof combined with
the results of operations and distributions for each applicable class for
the period January 10, 1995, through October 31, 1995.
<F7> Net investment income per share is calculated using ending balances prior
to consideration of adjustments for permanent book and tax differences.
<F8> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
FINANCIAL HIGHLIGHTS
RETAIL A SHARE BOND FUNDS
Income from
Investment Operations
---------------------------------
Net
Realized
and
Net Unrealized
Asset Gains Total
Value, Net or (Losses) From
Beginning Investment on Investment
PER SHARE DATA of Period Income<F1> Securities Operations
- -----------------------------------------------------------------------------
SHORT-TERM BOND MARKET
- -----------------------------------------------------------------------------
Year Ended October 31, 1995<F7> $10.03 $0.61 $ 0.24 $0.85
- -----------------------------------------------------------------------------
Year Ended October 31, 1996 10.28 0.58<F8> (0.03) 0.55
- -----------------------------------------------------------------------------
Year Ended October 31, 1997 10.25 0.60 0.02 0.62
- -----------------------------------------------------------------------------
Year Ended October 31, 1998 10.27 0.58 0.07 0.65
- -----------------------------------------------------------------------------
Year Ended October 31, 1999 10.34 0.54 (0.22) 0.32
- -----------------------------------------------------------------------------
INTERMEDIATE BOND MARKET
- -----------------------------------------------------------------------------
Year Ended October 31, 1995<F7> 9.67 0.60 0.53 1.13
- -----------------------------------------------------------------------------
Year Ended October 31, 1996 10.21 0.56<F8> (0.02) 0.54
- -----------------------------------------------------------------------------
Year Ended October 31, 1997 10.19 0.58 0.12 0.70
- -----------------------------------------------------------------------------
Year Ended October 31, 1998 10.31 0.57 0.19 0.76
- -----------------------------------------------------------------------------
Year Ended October 31, 1999 10.50 0.56 (0.39) 0.17
- -----------------------------------------------------------------------------
TAX-EXEMPT INTERMEDIATE BOND
- -----------------------------------------------------------------------------
Year Ended October 31, 1995<F7> 9.78 0.42 0.45 0.87
- -----------------------------------------------------------------------------
Year Ended October 31, 1996 10.23 0.40<F8> (0.01) 0.39
- -----------------------------------------------------------------------------
Year Ended October 31, 1997 10.21 0.42 0.14 0.56
- -----------------------------------------------------------------------------
Year Ended October 31, 1998 10.35 0.41 0.17 0.58
- -----------------------------------------------------------------------------
Year Ended October 31, 1999 10.52 0.42 (0.40) 0.02
- -----------------------------------------------------------------------------
BOND IMMDEX/TM
- -----------------------------------------------------------------------------
Year Ended October 31, 1995<F7> 25.67 1.68 2.30 3.9
- -----------------------------------------------------------------------------
Year Ended October 31, 1996 27.82 1.61<F8> (0.26) 1.35
- -----------------------------------------------------------------------------
Year Ended October 31, 1997 27.54 1.66 0.64 2.30
- -----------------------------------------------------------------------------
Year Ended October 31, 1998 28.16 1.64 0.85 2.49
- -----------------------------------------------------------------------------
Year Ended October 31, 1999 29.01 1.64 (1.66) (0.02)
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
Less Distributions Supplemental Data and Ratios
--------------------------------- --------------------------------------------
Ratio
Ratio of Net
Dividends Net Net of Net Investment
from Distributions Asset Assets, Expenses Income Portfolio
Net From Value, End of to Average to Average Turnover
Investment Capital Total End of Total Period Net Net Rate
PER SHARE DATA Income Gains Distributions Period Return<F2> (000s) Assets Assets <F8>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHORT-TERM BOND MARKET
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F7> $(0.60) $ - $(0.60) $10.28 8.74% $47,730 0.69<F3> 6.04<F3> 100.58%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.58) - (0.58) 10.25 5.54% 58,843 0.75<F3> 5.67<F3> 59.62%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.60) - (0.60) 10.27 6.21% 65,567 0.75<F3> 5.79<F3> 77.12%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.58) - (0.58) 10.34 6.58% 75,410 0.75<F3> 5.67<F3> 78.20%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.54) - (0.54) 10.12 3.16% 65,490 0.81<F3> 5.27<F3> 52.28%
- ------------------------------------------------------------------------------------------------------------------------------------
INTERMEDIATE BOND MARKET
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F7> (0.59) - (0.59) 10.21 12.04% 11,576 0.69<F4> 6.07<F4> 66.69%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.56) - (0.56) 10.19 5.51% 17,392 0.75<F4> 5.59<F4> 59.29%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.58) - (0.58) 10.31 7.09% 20,691 0.75<F4> 5.71<F4> 40.61%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.57) - (0.57) 10.50 7.57% 29,550 0.75<F4> 5.50<F4> 27.29%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.56) (0.01) (0.57) 10.10 1.66% 33,779 0.81<F4> 5.47<F4> 64.07%
- ------------------------------------------------------------------------------------------------------------------------------------
TAX-EXEMPT INTERMEDIATE BOND
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F7> (0.42) - (0.42) 10.23 9.07% 7,711 0.71<F5> 4.25<F5> 44.13%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (0.41) - (0.41) 10.21 3.87% 10,690 0.75<F5> 3.99<F5> 30.46%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (0.42) - (0.42) 10.35 5.60% 19,199 0.75<F5> 4.11<F5> 11.22%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (0.41) - (0.41) 10.52 5.73% 32,466 0.75<F5> 4.00<F5> 14.38%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (0.41) (0.01) (0.42) 10.12 0.14% 20,016 0.89<F5> 3.91<F5> 21.77%
- ------------------------------------------------------------------------------------------------------------------------------------
BOND IMMDEX/TM
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995<F7> (1.79) (0.04) (1.83) 27.82 16.05% 21,875 0.64<F6> 6.31<F6> 41.67%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 (1.63) - (1.63) 27.54 5.06% 42,671 0.68<F6> 5.98<F6> 33.38%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 (1.68) - (1.68) 28.16 8.68% 64,144 0.67<F6> 6.08<F6> 35.12%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 (1.64) - (1.64) 29.01 9.11% 95,301 0.67<F6> 5.77<F6> 20.07%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 (1.63) - (1.63) 27.36 (0.05)% 95,635 0.72<F6> 5.80<F6> 57.04%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> For the Tax-Exempt Intermediate Bond Fund, substantially all investment
income is exempt from federal income tax.
<F2> The total return calculation does not reflect the maximum sales charge of
3.75%.
<F3> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
1.09%, 1.11%, 1.11%, 1.12%, 1.10%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 4.99%, 5.31%, 5.43%,
5.30%, 5.63%, respectively.
<F4> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.95%, 0.96%, 0.98%, 0.99%, 0.98%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996 and 1995 would have been 5.33%, 5.29%, 5.48%,
5.35%, 5.78%, respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
1.07%, 1.06%, 1.13%, 1.22%, 1.20%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 3.73%, 3.69%, 3.73%,
3.52%, 3.76%, respectively.
<F6> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.74%, 0.74%, 0.74%, 0.75%, 0.71%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 5.78%, 5.70%, 6.01%,
5.91%, 6.24%, respectively.
<F7> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareowners exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented on
a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class of
shares based upon the relative net assets of each class of shares as of the
close of business on January 9, 1995, and the results thereof combined with
the results of operations and distributions for each applicable class for
the period January 10, 1995, through October 31, 1995.
<F8> Net investment income per share is calculated using ending balances prior
to consideration of adjustments for permanent book and tax differences.
<F9> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
FINANCIAL HIGHLIGHTS
RETAIL B SHARE BOND FUNDS
Income from
Investment Operations
---------------------------------
Net
Realized
and
Net Unrealized
Asset Gains Total
Value, Net or (Losses) From
Beginning Investment on Investment
PER SHARE DATA of Period Income<F1> Securities Operations
- -----------------------------------------------------------------------------
SHORT-TERM BOND MARKET
- -----------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 $10.23 $0.31<F10> $(0.09) $0.22
- -----------------------------------------------------------------------------
INTERMEDIATE BOND MARKET
- -----------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 10.31 0.31<F10> (0.21) 0.10
- -----------------------------------------------------------------------------
TAX-EXEMPT INTERMEDIATE BOND
- -----------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 10.51 0.22<F10> (0.38) (0.16)
- -----------------------------------------------------------------------------
BOND IMMDEX/TM
- -----------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 28.34 0.92<F10> (0.91) 0.01
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
Less Distributions Supplemental Data and Ratios
--------------------------------- --------------------------------------------
Ratio
Ratio of Net
Dividends Net Net of Net Investment
from Distributions Asset Assets, Expenses Income Portfolio
Net From Value, End of to Average to Average Turnover
Investment Capital Total End of Total Period Net Net Rate
PER SHARE DATA Income Gains Distributions Period Return<F2> (000s) Assets Assets <F8>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHORT-TERM BOND MARKET
- ------------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through 1.57% 4.58%
October 31, 1999 $(0.33) $ - $(0.33) $10.12 2.18%<F7> $ 517 <F4><F8> <F4><F8> 52.28%
- ------------------------------------------------------------------------------------------------------------------------------------
INTERMEDIATE BOND MARKET
- ------------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through 1.57% 4.87%
October 31, 1999 (0.32) - (0.32) 10.09 1.02%<F7> 206 <F5><F8> <F5><F8> 64.07%
- ------------------------------------------------------------------------------------------------------------------------------------
TAX-EXEMPT INTERMEDIATE BOND
- ------------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through 1.67% 3.25%
October 31, 1999 (0.23) - (0.23) 10.12 (1.55)% <F7> 74 <F6><F8> <F6><F8> 21.77%
- ------------------------------------------------------------------------------------------------------------------------------------
BOND IMMDEX/TM
- ------------------------------------------------------------------------------------------------------------------------------------
March 1, 19991 through
October 31, 1999 (0.99) - (0.99) 27.36 0.04%<F7> 1,869 1.49%<F8> 5.06%<F8> 57.04%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Commencement of operations.
<F2>For the Tax-Exempt Intermediate Bond Fund, substantially all investment
income is exempt from federal income tax.
<F3> The total return calculation does not reflect the maximum deferred sales
charge of 5.00%.
<F4>Without fees waived, ratio of net expenses to average net assets for the
period ended October 31, 1999 would have been 1.85%, and ratio of net
investment income for the period ended October 31, 1999 would have been
4.30%.
<F5> Without fees waived, ratio of net expenses to average net assets for the
period ended October 31, 1999 would have been 1.71%, and ratio of net
investment income for the period ended October 31, 1999 would have been
4.73%.
<F6> Without fees waived, ratio of net expenses to average net assets for the
period ended October 31, 1999 would have been 1.85%, and ratio of net
investment income for the period ended October 31, 1999 would have been
3.07%.
<F7> Not annualized
<F8>Annualized
<F9>Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
<F10>Net investment income per share represents net investment income dividend
by the average shares outstanding throughout the period.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
SHORT-TERM BOND MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
LONG-TERM INVESTMENTS 96.4%
ASSET-BACKED SECURITIES 31.9%
AUTO LOAN RECEIVABLES 1.9%
General Motors Acceptance Corp. Grantor,
$ 123 Series 1991-A1, Class A, 8.17%, 1/02/00 $ 123
Honda Auto Lease Trust,
3,500 Series 1999-A, Class A5, 6.65%, 7/15/05 3,512
-----------
3,635
-----------
CREDIT CARD RECEIVABLES 11.6%
Banc One Credit Card Master Trust,
2,000 Series 1995-B, Class A, 6.30%, 9/15/00 1,998
Chemical Master Credit Card Trust I,
3,060 Series 1995-2, Class A, 6.23%, 6/15/03 3,053
Citibank Credit Card Master Trust I, Principal Only:
5,220 Series 1996-1, Class A, 0.00%, 2/07/01 4,808
1,500 Series 1997-6, Class A, 0.00%, 8/15/06 1,081
Household Affinity Credit Card Master Trust I,
1,650 Series 1993-2, Class A, 5.60%, 11/15/00 1,643
NationsBank Credit Card Master Trust:
3,995 Series 1995-1, Class A, 6.45%, 8/15/00 3,996
102 Series 1995-1, Class A, 6.45%, 4/15/03 102
Sears Credit Account Master Trust:
703 Series 1995-2, Class A, 8.10%, 6/15/04 711
2,000 Series 1996-1, Class A, 6.20%, 2/16/06 1,993
Spiegel Credit Card Master Trust:
1,333 Series 1994-B, Class A, 8.15%, 6/15/04 1,342
2,124 Series 1995-A, Class A, 7.50%, 9/15/04 2,136
-----------
22,863
-----------
HOME EQUITY LOAN RECEIVABLES 18.4%
Advanta Home Equity Loan Trust:
696 Series 1992-3, Class A1, 6.05%, 9/25/08 680
1,463 Series 1993-2, Class A2, 6.15%, 10/25/09 1,436
1,379 Series 1993-3, Class A1, 4.90%, 1/25/10 1,358
1,344 Series 1993-4, Class A1, 5.50%, 3/25/10 1,305
AFC Home Equity Loan Trust:
1,632 Series 1993-1, Class 1A, 5.90%, 5/20/08 1,609
1,294 Series 1993-4, Class 1A, 5.80%, 2/26/24 1,261
1,220 Series 1994-1, Class 1A, 6.40%, 5/25/25 1,207
BankAmerica Manufactured Housing Contract,
3,500 Series 1997-2, Class A6, 6.47%, 4/10/15 3,457
Contimortgage Home Equity Loan Trust,
1,000 Series 1997-4, Class A4, 6.30%, 7/15/02 993
Corestates Home Equity Trust,
2,110 Series 1996-1, Class A3, 7.00%, 12/15/09 2,116
EQCC Home Equity Loan Trust:
1,820 Series 1993-3, Class A, 5.15%, 9/15/08 1,767
1,285 Series 1993-4, Class A, 5.725%, 12/15/08 1,263
29 Series 1996-1, Class A2, 5.82%, 9/15/09 29
2,500 Series 1996-2, Class A2, 7.125%, 12/15/10 2,509
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
HOME EQUITY LOAN RECEIVABLES 18.4% (CONT.)
Equivantage Home Equity:
$2,264 Series 1996-1, Class A, 6.55%, 10/25/25 $ 2,246
2,150 Series 1996-4, Class A, 6.75%, 1/25/28 2,106
GE Home Equity Loan Asset-Backed Certificates:
2,070 Series 1991-1, Class B, 8.70%, 9/15/11 2,065
2,000 Series 1996-HE1, Class A4, 7.30%, 2/25/25 1,999
IMC Home Equity Loan Trust,
1,359 Series 1997-3, Class A4, 6.84%, 10/20/13 1,356
The Money Store Home Equity Trust:
823 Series 1993-B, Class A2, 6.975%, 7/15/08 822
652 Series 1995-C, Class A3, 6.55%, 9/15/21 651
1,679 Series 1993-B, Class A3, 6.10%, 5/15/22 1,661
UCFC Home Equity Loan:
630 Series 1993-B2, Class A2, 6.20%, 7/25/14 618
1,000 Series 1996-C1, Class A4, 7.475%, 3/15/20 1,006
663 Series 1995-A2, Class A7, 8.30%, 2/10/26 673
-----------
36,193
-----------
CORPORATE BONDS 28.2%
ABN AMRO Bank Guarantee,
1,750 6.625%, 10/31/01 1,746
AT&T Capital Corp. Company Guarantee:
2,000 6.875%, 1/16/01 2,005
3,295 6.25%, 5/15/01 3,273
America West Airlines Pass-Thru Certificates,
1,758 8.54%, 1/02/06 (Acquired 9/14/99, Cost $1,758)<F1> 1,758
Associated P&C Holdings Senior Notes,
2,000 6.75%, 7/15/03 (Acquired 9/03/99, Cost $1,908)<F1> 1,928
AVCO Financial Services Medium Term Notes,
1,100 5.75%, 1/23/01 1,088
Bankers Trust Subordinated Debentures,
1,000 8.125%, 5/15/02 1,025
Bankers Trust Subordinated Notes,
1,500 8.125%, 4/01/02 1,541
Bear Stearns Company Senior Notes,
800 9.375%, 6/01/01 830
Beneficial Corp. Notes,
800 8.20%, 3/15/02 827
Dillard Investment Debentures,
2,000 9.25%, 2/01/01 2,064
Donaldson, Lufkin & Jenrette Senior Notes,
4,000 6.00%, 12/01/01 3,939
Dynegy, Inc. Senior Notes,
2,000 6.875%, 7/15/02 1,993
Federal Express Corporation Debentures,
2,000 9.625%, 10/15/19 2,075
First Chicago Corporation Subordinated Notes,
2,230 11.25%, 2/20/01 2,362
First Interstate Bancorp Subordinated Notes,
2,000 10.875%, 4/15/01 2,106
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
SHORT-TERM BOND MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
CORPORATE BONDS 28.2% (CONT.)
Fleet Boston Corporation Subordinated Notes,
$ 950 6.875%, 3/01/03 $ 947
Goldman Sachs Group Notes,
2,000 6.25%, 2/01/03 (Acquired 6/30/99, Cost $1,961)<F1> 1,948
Lehman Brothers Holdings, Inc. Notes:
1,700 9.875%, 10/15/00 1,752
1,100 6.65%, 11/08/00 1,099
2,000 8.75%, 5/15/02 2,078
Marlin Water Trust Senior Notes,
1,500 7.09%, 12/15/01 (Acquired 12/08/98; cost $1,492)<F1> 1,494
MFS Communications Senior Discount Notes,
2,472 8.875%, 1/15/06<F2> 2,605
The Money Store Company Guarantee,
1,740 8.05%, 4/15/02 1,789
The Money Store Subordinated Notes,
1,350 7.30%, 12/01/02 1,359
Osprey Trust Secured Notes,
1,750 8.31%, 1/15/03 (Acquired 9/16/99, Cost $1,750)<F1> 1,747
Paine Webber Group Inc. Notes,
1,025 6.45%, 12/01/03 994
Security Pacific Corporation Subordinated Notes,
1,458 11.50%, 11/15/00 1,526
Transamerica Financial Corp. Senior Notes,
1,900 6.125%, 11/01/01 1,866
USF&G Corporation Senior Notes,
1,455 8.375%, 6/15/01 1,493
Worldcom, Inc. Senior Notes,
2,000 8.875%, 1/15/06 2,113
-----------
55,370
-----------
MORTGAGE-BACKED SECURITIES 5.2%
Collateralized Mortgage Obligation Trust,
858 Series 15, Class E, 5.00%, 3/20/18 847
Green Tree Financial Corp. Pass-Thru Certificates:
1,123 Series 1992-2, Class A4, 8.15%, 1/15/18 1,144
695 Series 1993-3, Class A5, 5.75%, 10/15/18 688
558 Series 1994-8, Class A4, 8.50%, 4/15/25 561
1,000 Series 1995-5, Class A5, 6.90%, 9/15/26 1,002
3,330 Series 1995-9, Class A4, 6.45%, 1/15/27 3,330
300 Series 1996-1, Class A3, 6.20%, 3/15/27 297
Prudential Securities Financial Asset Funding Corp.,
383 Series 1993-4, Class A3, 6.83%, 9/25/09 383
Prudential Securities Secured Financing Corp.:
707 Series 1998-C1, Class A1, 6.105%, 11/15/02 700
1,391 Series 1994-5, Class A1, 5.66%, 5/25/24 1,341
-----------
10,293
-----------
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
INTERNATIONAL/YANKEE (U.S. $ DENOMINATED) 6.9%
Ford Capital BV Debentures,
$1,450 9.875%, 5/15/02 $ 1,553
Ford Capital BV Notes,
2,935 10.125%, 11/15/00 3,045
Korea Development Bank Bonds:
2,000 6.25%, 5/01/00 1,994
2,000 7.125%, 9/17/01 1,983
Sumitomo Bank International Notes,
5,000 9.55%, 7/15/00 5,021
-----------
13,596
-----------
OTHER 0.4%
Florida Housing Finance Agency:
190 Antigua Club-A-2, 8.625%, 8/01/01 192
255 Brittany Apartments-C-2, 8.625%, 8/01/02 258
280 Maitland Club-B-2, 8.625%, 8/01/01 283
-----------
733
-----------
U.S. GOVERNMENT AGENCY-BACKED MORTGAGE ISSUES 2.5%
Federal Home Loan Mortgage Corporation (FHLMC)
Participation Certificates:
3 7.00%, 12/01/01 3
81 7.75%, 7/01/09 84
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC):
571 Series 1022, Class J, 6.00%, 12/15/20 551
12 Series 1169, Class D, 7.00%, 5/15/21 12
95 Series 1286, Class E, 7.00%, 10/15/21 95
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC):
579 Series 1991-63, Class G, 6.95%, 5/25/06 582
3,600 Series 1996-W4, Class A4, 6.743%, 12/25/11 3,574
44 Series G92-53, Class H, 7.00%, 7/25/21 44
-----------
4,945
-----------
U.S. TREASURY OBLIGATIONS 21.3%
U.S. Treasury Bonds,
11,550 10.75%, 2/15/03 13,153
U.S. Treasury Notes:
17,950 6.625%, 3/31/02 18,247
10,300 6.375%, 8/15/02 10,426
-----------
41,826
-----------
Total Long-Term Investments (Cost $191,113) 189,454
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
SHORT-TERM BOND MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Number Market Value
of Shares (in thousands)
----------- -------------
SHORT-TERM INVESTMENTS 1.7%
INVESTMENT COMPANIES 1.7%
10 Financial Square Prime Obligation Fund $ 10
3,424 Short-Term Investments Co. Liquid Assets Portfolio 3,424
-----------
Total Short-Term Investments (Cost $3,434) 3,434
-----------
Total Investments (Cost $194,547) 98.1% 192,888
-----------
Other Assets, less liabilities 1.9% 3,730
-----------
TOTAL NET ASSETS 100.0% $196,618
===========
<F1> Unregistered security
<F2> Fair valued security
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
INTERMEDIATE BOND MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
LONG-TERM INVESTMENTS 96.1%
ASSET-BACKED SECURITIES 15.7%
AUTO LOAN RECEIVABLES 1.0%
Honda Auto Lease Trust,
$ 3,000 Series 1999-A, Class A5, 6.65%, 7/15/05 $ 3,011
-----------
CREDIT CARD RECEIVABLES 5.9%
American Express Master Trust,
2,000 Series 1994-2, Class A, 7.60%, 8/15/02 2,037
Chemical Master Credit Card Trust,
633 Series 1995-3, Class A, 6.23%, 4/15/05 628
Citibank Credit Card Master Trust, Principal Only:
11,900 Series 1996-1, Class A, 0.00%, 2/07/01 10,961
1,875 Series 1997-6, Class A, 0.00%, 8/15/06 1,351
Household Affinity Credit Card Master Trust I,
3,300 Series 1993-2, Class A, 5.60%, 11/15/00 3,286
Spiegel Credit Card Master Trust,
633 Series 1994-B, Class A, 8.15%, 6/15/04 637
-----------
18,900
-----------
HOME EQUITY LOAN RECEIVABLES 8.8%
Advanta Home Equity Loan Trust:
654 Series 1993-1, Class A1, 5.95%, 3/25/09 638
942 Series 1993-1, Class A2, 5.95%, 5/25/09 922
AFC Home Equity Loan Trust:
1,883 Series 1993-4, Class 1A, 5.80%, 2/26/24 1,834
2,325 Series 1996-4, Class 1A7, 6.86%, 3/25/27 2,297
Contimortgage Home Equity Loan Trust:
5,000 Series 1997-4, Class A4, 6.30%, 7/15/12 4,965
2,950 Series 1997-5, Class A5, 6.63%, 12/15/20 2,905
1,000 Series 1997-2, Class A9, 7.09%, 4/15/28 997
3,075 Series 1997-3, Class A9, 7.12%, 8/15/28 3,010
Corestates Home Equity Trust,
967 Series 1996-1, Class A3, 7.00%, 12/15/09 970
Delta Funding Home Equity Loan Trust,
2,000 Series 1997-4, Class A5F, 6.67%, 1/25/28 1,948
EQCC Home Equity Loan Trust:
573 Series 1994-4, Class A3, 8.68%, 10/15/08 578
848 Series 1993-4, Class A, 5.725%, 12/15/08 834
1,122 Series 1994-1, Class A, 5.80%, 3/15/09 1,103
2,000 Series 1996-1, Class A4, 6.56%, 3/15/23 1,941
2,000 Series 1997-1, Class A7, 7.12%, 5/15/28 2,010
UCFC Home Equity Loan,
1,079 Series 1995-C2, Class A6, 6.825%, 10/10/26 1,075
-----------
28,027
-----------
CORPORATE BONDS 45.8%
ABN AMRO Bank Guarantee,
1,600 7.25%, 5/31/05 1,602
Aetna Services, Inc. Company Guarantee,
3,000 6.75%, 8/15/01 2,993
Aetna Services, Inc. Debentures,
1,375 6.75%, 9/15/13 1,241
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
CORPORATE BONDS 45.8% (CONT.)
America West Airlines, Pass-Thru Certificates,
$ 2,500 8.54%, 1/02/06 (Acquired 9/14/99, Cost $2,500)<F1> $ 2,500
Amsouth Bancorp Subordinated Notes,
1,500 7.75% 5/15/04 1,527
Associated P&C Holdings Senior Notes,
1,500 6.75% 7/15/03 (Acquired 9/03/99, Cost $1,431)<F1> 1,446
AT&T Capital Corporation Company Guarantee:
2,000 6.25% 5/15/01 1,986
1,075 6.75% 2/04/02 1,073
BankAmerica Corporation Subordinated Notes,
2,000 10.00%, 2/01/03 2,177
BankBoston Notes,
1,450 6.375%, 4/15/08 1,362
Bankers Trust - NY, Subordinated Debentures,
6,000 8.125%, 5/15/02 6,149
Bear Stearns Company Senior Notes:
2,000 9.375%, 6/01/01 2,074
150 6.25%, 7/15/05 143
Caterpillar, Inc. Sinking Fund Debentures,
2,112 9.75%, 6/01/19 2,207
Chase Manhattan Corp. Subordinated Notes,
2,300 9.375%, 7/01/01 2,402
Conectiv, Inc. Medium Term Notes,
3,000 6.73%, 6/01/06 2,951
Continental Bank N.A. Subordinated Notes,
2,875 12.50%, 4/01/01 3,107
Continental Cablevision, Inc. Debentures,
4,525 9.50%, 8/01/13 5,021
Dillard Investment Debentures,
1,895 9.25%, 2/01/01 1,956
Donaldson, Lufkin & Jenrette, Inc. Senior Notes,
3,000 5.875%, 4/01/02 2,928
Dynegy, Inc. Senior Notes,
2,100 6.875%, 7/15/02 2,092
Federal Express Corporation Notes,
1,500 9.65%, 6/15/12 1,752
Federal Express Sinking Fund Pass-Thru Certificates,
844 7.89%, 9/23/08 844
First Interstate Bancorp Subordinated Notes:
2,350 10.875%, 4/15/01 2,474
500 9.90%, 11/15/01 529
First National Bank Omaha Subordinated Notes,
1,600 7.32%, 12/01/10 1,567
First USA Bank Senior Notes,
1,000 5.85%, 2/22/01 993
Ford Motor Credit Co. Notes:
2,575 8.20%, 2/15/02 2,655
1,000 9.03%, 12/30/09 1,076
FPL Group Capital, Inc. Guaranteed Notes,
1,500 7.625%, 9/15/06 1,526
General Motors Acceptance Corp. Notes,
1,000 9.625%, 12/15/01 1,058
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
INTERMEDIATE BOND MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
CORPORATE BONDS 45.8% (CONT.)
Georgia Pacific Corp. Debentures:
$1,150 9.50%, 12/01/11 $1,301
775 9.50%, 5/15/22 841
Goldman Sachs Group Notes,
5,000 6.25%, 2/01/03 (Acquired 2/01/96; Cost $4,988)<F1> 4,869
Homeside, Inc. Senior Notes,
1,000 11.25%, 5/15/03 1,128
Lehman Brothers Holdings, Inc. Notes:
1,500 6.65%, 11/08/00 1,499
1,212 8.875%, 3/01/02 1,261
800 8.75%, 5/15/02 831
2,700 7.50%, 9/01/06 2,689
Lehman Brothers, Inc. Debentures,
1,000 6.125%, 2/01/01 991
2,450 11.625%, 5/15/05 2,907
Marlin Water Trust Senior Notes,
2,492 7.09%, 12/15/01 (Acquired 12/08/98; Cost $2,492)<F1> 2,482
The May Department Stores Debentures,
2,000 9.875%, 6/15/21 2,170
Merrill Lynch & Company Notes,
7,000 5.75%, 11/04/02 6,829
National Westminster Bank Debentures,
1,700 9.375%, 11/15/03 1,835
National Westminster Bank Subordinated Notes,
700 9.45%, 5/01/01 731
NCNB Corp. Subordinated Notes,
2,380 10.20%, 7/15/15 2,942
Newcourt Credit Group Notes:
1,785 7.125%, 12/17/03 (Acquired 9/14/99, Cost $1,772)<F1> 1,795
1,800 6.875%, 2/16/05 (Acquired 3/16/99, Cost $1,032)<F1> 1,781
News America Holdings Debentures,
750 10.125%, 10/15/12 822
Northwest Airlines Pass-Thru Certificates,
836 8.13%, 2/01/14 798
Oneok, Inc. Notes,
1,100 7.75%, 8/15/06 1,110
Osprey Trust Secured Notes,
2,300 8.31%, 1/15/03 (Acquired 9/16/99, Cost $2,300)<F1> 2,297
Paine Webber Group, Inc. Notes:
2,080 7.70%, 2/11/00 2,089
3,000 7.115%, 1/27/04 2,969
500 8.875%, 3/15/05 531
Principal Financial Group Senior Notes,
4,500 8.20%, 8/15/09 (Acquired 8/18/99, Cost $4,486)<F1> 4,566
PSI Energy, Inc. Debentures,
1,600 7.85%, 10/15/07 1,614
JC Penney Company, Inc. Debentures:
1,950 9.75%, 6/15/21 2,088
875 8.25%, 8/15/22 861
Rochester Telephone Debentures,
1,000 9.00%, 8/15/21 1,073
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
CORPORATE BONDS 45.8% (CONT.)
Salomon, Inc. Senior Notes,
$1,100 6.75%, 2/15/03 $ 1,092
The Charles Schwab Corp. Medium Term Notes,
650 6.06%, 10/02/00 648
Sears Roebuck Acceptance Corporation Notes,
1,300 6.25%, 5/01/09 1,169
Security Capital Group, Inc. Medium Term Notes
1,700 7.75%, 11/15/03 1,665
Security Pacific Corp. Subordinated Notes,
1,158 11.00%, 3/01/01 1,219
Standard Federal Bancorp Medium Term Notes,
2,155 7.75%, 7/17/06 2,174
Toll Road Investors Debentures, Principal Only,
4,800 0.00%, 2/15/04
(Acquired 4/23/99, Cost $3,591)<F1> 3,535
Transamerica Financial Corporation Senior Notes,
3,225 6.125%, 11/01/01 3,168
United Airlines Pass-Thru Certificates,
3,152 7.27%, 1/30/13 3,025
United HealthCare Corporation Notes,
5,000 6.60%, 12/01/03
(Acquired 11/19/98, Cost $4,989)<F1> 4,877
-----------
145,683
-----------
MORTGAGE-BACKED SECURITIES 3.3%
Advanta Mortgage Loan Trust,
1,060 Series 1997-1, Class A5, 7.35%, 5/25/27 1,064
Green Tree Financial Corp. Pass-Thru Certificates:
43 Series 1993-4, Class A3, 6.25%, 1/15/19 43
1,357 Series 1994-4, Class A4, 7.95%, 7/15/19 1,378
MDC Asset Investors Trust,
Real Estate Mortgage Investment Conduit (REMIC),
501 Series VIII, Class 8, 7.75%, 9/25/17 512
Prudential Securities Financial Asset Funding Corp.,
1,453 Series 1993-8, Class A, 5.775%, 11/15/14 1,424
Prudential Securities Secured Financing Corp.:
1,884 Series 1993-1, Class A, 6.44%, 2/16/21 1,860
1,700 Series 1994-5, Class A1, 5.66%, 5/25/25 1,638
Salomon Brothers Mortgage Securities,
888 Series 1986-1, Class A, 6.00%, 12/25/11 861
Westam Mortgage Financial Corporation,
1,612 Series 11, Class A, 6.36%, 8/26/20 1,577
-----------
10,357
-----------
INTERNATIONAL/YANKEE (U.S. $ DENOMINATED) 10.6%
AT&T Canada, Inc. Senior Notes:
2,000 9.95%, 6/15/08 1,555
1,000 10.625%, 11/01/08 1,135
Banco Santander-Chile Notes,
3,450 6.50%, 11/01/05 3,296
Corp Andina De Fomento Notes,
750 7.75%, 3/01/04 750
Dresdner Bank Subordinated Debentures,
650 7.25%, 9/15/15 622
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
INTERMEDIATE BOND MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
INTERNATIONAL/YANKEE
(U.S. $ DENOMINATED) 10.6% (CONT.)
Ford Capital BV Debentures:
$ 175 9.875%, 5/15/02 $ 187
600 9.50%, 6/01/10 689
Ford Capital BV Notes,
4,153 10.125%, 11/15/00 4,309
Hydro-Quebec Corporation Debentures,
2,250 11.75%, 2/01/12 3,017
Korea Development Bank Bonds:
1,300 6.25%, 5/01/00 1,296
1,075 7.125%, 9/17/01 1,066
Korea Electric Power Debentures:
820 7.75%, 4/01/13 746
750 6.75%, 8/01/27 702
Midland Bank PLC Subordinated Notes,
4,225 6.95%, 3/15/11 4,005
National Bank of Hungary Debentures,
1,350 8.875%, 11/01/13 1,461
Norsk Hydro A/S Debentures,
1,350 9.00%, 4/15/12 1,509
Pohang Iron & Steel Notes,
875 7.125%, 7/15/04 835
Sumitomo Bank International Notes,
1,600 9.55%, 7/15/00 1,607
Sanwa Bank Ltd. Subordinated Notes,
2,000 8.35%, 7/15/09 2,031
Union Camp Corp. Debentures,
659 10.00%, 5/01/19 692
Wharf Capital International Ltd. Notes:
800 8.875%, 11/01/04 794
1,725 7.625%, 3/13/07 1,550
-----------
33,854
-----------
U.S. GOVERNMENT AGENCY-BACKED
MORTGAGE ISSUES 3.1%
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC):
630 Series 1289, Class PR, 7.50%, 2/15/03 636
724 Series 8, Class VB, 7.00%, 4/25/03 727
564 Series 1456, Class LA, 7.50%, 5/15/03 571
445 Series 1496, Class KA, 6.00%, 12/15/03 440
300 Series 1551, Class E, 6.50%, 9/15/07 300
396 Series 1167, Class E, 7.50%, 11/15/21 400
1,243 Series 1286, Class A, 6.00%, 5/15/22 1,196
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
U.S. GOVERNMENT AGENCY-BACKED
MORTGAGE ISSUES 3.1% (CONT.)
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment
Conduit (REMIC) (cont.):
$ 98 Series 1993-23, Class PU, 7.50%, 1/25/00 $ 98
420 Series 1992-73, Class L, 7.50%, 1/25/01 419
813 Series 1992-18, Class HB, 7.20%, 3/25/02 815
3,267 Series 1993-37, Class B, 7.00%, 7/25/02 3,282
612 Series 1992-103, Class L, 7.50%, 11/25/02 619
256 Series 1990-89, Class K, 6.50%, 7/25/20 250
-----------
9,753
-----------
U.S. TREASURY OBLIGATIONS 17.6%
U.S. Treasury Bonds:
10,000 13.75%, 8/15/04 13,100
4,400 10.75%, 8/15/05 5,361
7,600 9.875%, 11/15/15 10,122
U.S. Treasury Strips, Principal Only,
39,000 0.00%, 8/15/05 27,343
-----------
55,926
-----------
Total Long-Term Investments (Cost $308,200) 305,511
-----------
Number
of Shares
(in thousands)
SHORT-TERM INVESTMENTS 2.9%
INVESTMENT COMPANIES 2.9%
51 Financial Square Prime Obligation Fund 51
9,200 Short-Term Investments Co. Liquid Assets Portfolio 9,200
-----------
Total Short-Term Investments (Cost $9,251) 9,251
-----------
Total Investments (Cost $317,451) 99.0% 314,762
-----------
Other Assets, less Liabilities 1.0% 3,270
-----------
TOTAL NET ASSETS 100.0% $318,032
===========
<F1>Unregistered security
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
TAX-EXEMPT INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
GENERAL OBLIGATION 7.7%
Elgin, Illinois,
$ 2,990 7.25%, 1/01/04 $3,273
Lake County, Illinois, School District 112,
1,415 9.00%, 12/01/05 1,706
Washington State,
1,500 6.30%, 9/01/02 1,563
-----------
Total General Obligation (Cost $6,620) 6,542
-----------
REVENUE BONDS 3.3%
HOUSING 1.2%
South Dakota Housing Development Authority -
Homeownership Mortgage,
1,025 4.85%, 5/01/01 1,024
-----------
UNIVERSITY 0.4%
New England Education Student Loan
Marketing Corporation,
360 5.80%, 3/01/02 367
-----------
UTILITIES 1.7%
Scottsdale Arizona Water and Sewer,
1,290 7.00%, 7/01/06 1,443
-----------
Total Revenue Bonds (Cost $2,886) 2,834
-----------
PREREFUNDED AND ESCROWED
TO MATURITY 67.8%
Alaska State Housing Finance Corporation,
1,465 6.375%, 12/01/12, Prerefunded 12/01/02 1,573
Anniston, Alabama Regional Medical
Center Board Project,
1,400 8.00%, 7/01/11, Escrowed to Maturity 1,653
Arizona State Municipal Funding Program,
1,500 8.75%, 8/01/07, Escrowed to Maturity 1,868
Arizona Health Facilities Hospital Revenue,
1,935 7.25%, 11/01/14, Prerefunded 11/01/03 2,086
Cherokee County, Oklahoma, Principal Only,
1,340 0.00%, 11/01/11, Escrowed to Maturity 686
Cleveland, Ohio Parking Facilities Revenue,
1,125 8.10%, 9/15/22, Prerefunded 9/15/02 1,253
Delaware State Economic Development Authority,
First Mortgage; GilpinHall Project
2,800 7.625%, 7/01/25, Prerefunded 7/01/05 3,231
Delaware State Health Facilities Authority Revenue,
1,265 7.00%, 10/01/15, Prerefunded to Various Dates 1,391
Des Plaines, Illinois Hospital Facilities -
Holy Family Hospital Project,
620 10.75%, 1/01/14, Prerefunded 7/01/02 718
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
PREREFUNDED AND ESCROWED
TO MATURITY 67.8% (CONT.)
Detroit, Michigan Water Supply System,
$ 1,000 6.25%, 7/01/12, Prerefunded 7/01/02 $ 1,035
Douglas County, Nebraska Hospital Authority Revenue,
1,000 7.25%, 11/01/21, Prerefunded 11/01/01 1,076
Emporia, Kansas Sewer System,
1,165 6.625%, 11/15/07, Escrowed to Maturity 1,285
Farmington, New Mexico Power Revenue Bonds,
1,935 9.875%, 1/01/13, Prerefunded 7/01/05 2,417
Fruita, Colorado, Escrowed to Maturity:
245 9.25%, 10/01/01 260
490 9.25%, 4/01/03 558
Fulco, Georgia Hospital Authority
Anticipation Certificates,
1,090 6.25%, 9/01/13, Prerefunded 9/01/02 1,163
Granite, Illinois Single Family Mortgage Revenue,
965 7.75%, 10/01/11, Escrowed to Maturity 1,093
Hodgkins, Illinois,
1,200 9.50%, 12/01/09, Prerefunded 12/01/01 1,366
Houston, Texas Airport Systems Revenue,
950 8.20%, 7/01/05, Escrowed to Maturity 1,073
Illinois Health Facilities Authority Revenue,
Memorial Hospital,
1,000 7.25%, 5/01/22, Prerefunded 5/01/02 1,085
Illinois Health Facilities
Authority Revenue, Evangelical _ A
1,320 6.75%, 4/15/12, Escrowed to Maturity 1,455
Kentucky State Turnpike Authority Revenue,
1,400 7.20%, 7/01/09, Escrowed to Maturity 1,509
Louisiana Public Facilities
Authority Hospital Revenue,
1,915 7.25%, 10/01/22, Prerefunded 10/01/02 2,097
Louisville, Kentucky Water & Sewer Revenue,
1,250 6.00%, 11/15/07, Escrowed to Maturity 1,334
Loveland, Colorado, Water Utility Improvements,
1,365 8.875%, 11/01/05, Escrowed to Maturity 1,586
Metropolitan Government Nashville &
Davidson County, Tennessee Water & Sewer,
Principal Only,
9,010 0.00%, 12/01/13, Prerefunded 12/01/02 2,506
Michigan State Hospital Financial Authority,
Sisters of Mercy Health Corp.,
900 7.50%, 2/15/18, Prerefunded 2/15/01 954
Minneapolis, Minnesota Hospital and Rehabilitation,
St. Mary's Hospital;
1,255 10.00%, 6/01/13, Escrowed to Maturity 1,587
New Jersey State Turnpike Authority Revenue,
675 6.75%, 1/01/09, Escrowed to Maturity 702
Oklahoma State Industrial Authority Revenue,
St. Anthony Hospital,
865 6.125%, 6/01/03, Escrowed to Maturity 902
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
TAX-EXEMPT INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
PREREFUNDED AND ESCROWED
TO MATURITY 67.8% (CONT.)
Peninsula Ports Authority Virginia Health
Care Facilities - Mary Immaculate Project,
$ 2,000 7.00%, 8/01/17, Prerefunded to 8/01/04 & 8/01/06 $2,164
Philadelphia Hospitals Authority Revenue,
990 9.875%, 7/01/10, Prerefunded 7/01/05 1,240
Phoenix, Arizona Street & Highway Users, Partially
Prerefunded 7/01/02, Remainder
Escrowed to Maturity:
1,000 6.50%, 7/01/09 1,058
4,700 6.25%, 7/01/11 5,002
Regional Transportation Authority, Illinois Series B
1,000 6.00%, 6/01/07, Prerefunded 6/01/04 1,069
San Marcos, California Certificates of
Participation, Principal Only,
1,085 0.00%, 2/15/06, Escrowed to Maturity 800
Tulsa County, Oklahoma Home Finance Authority Single
Family Mortgage Revenue,
1,710 6.90%, 8/01/10, Escrowed to Maturity 1,932
Tulsa County, Oklahoma Industrial Authority
Health Care Revenue,
740 6.75%, 12/15/18, Prerefunded 6/15/01 783
University of Illinois,
1,005 6.10%, 10/01/03, Escrowed to Maturity 1,058
Wausau, Wisconsin School District,
1,000 6.50%, 4/01/10, Prerefunded 4/01/02 1,048
-----------
Total Prerefunded and Escrowed to Maturity
(Cost $58,686) 57,656
-----------
INSURED MUNICIPAL BONDS 18.4%
EDUCATION 2.8%
Cook County, Illinois Niles Twp.
School District, Principal Only,
1,560 0.00%, 12/01/07 1,010
Cook County, Illinois Cicero School District,
1,000 8.50%, 12/01/04 1,164
Merrillville, Indiana Multi-School
Building Corporation,
200 6.375%, 7/01/03 212
-----------
2,386
-----------
ELECTRIC 2.5%
Springfield, Illinois Electric Revenue:
1,000 6.00%, 3/01/04 1,048
1,050 6.00%, 3/01/06 1,107
-----------
2,155
-----------
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
GENERAL OBLIGATION 9.4%
Amarillo, Texas Independent School District,
$ 1,035 7.00%, 2/01/06 $ 1,141
Bolingbrook, Illinois, Principal Only,
1,080 0.00%, 1/01/05 832
Chicago, Illinois,
675 11.60%, 1/01/01 732
Maricopa County, Arizona Elementary School District,
No. 068, Alhambra,
2,500 5.625%, 7/01/13, Partially Prerefunded 2,548
Palatine, Illinois,
1,405 9.90%, 1/01/16, Crossover Refunded 1/01/00 1,447
Will County, Illinois Community School
District #365, Principal Only,
1,685 0.00%, 11/01/05 1,239
-----------
7,939
-----------
PUBLIC FACILITIES & IMPROVEMENTS 3.7%
Illinois State Certificates of Participation,
1,000 6.00%, 7/01/06 1,055
Mun-Del Building Corp., Indiana,
1,000 7.00%, 1/05/05 1,025
Texas State Turnpike Authority, Dallas,
1,000 6.50%, 1/01/08 1,088
-----------
3,168
-----------
Total Insured Municipal Bonds (Cost $15,851) 15,648
-----------
Number
of Shares
(in thousands)
INVESTMENT COMPANIES 0.9%
803 Tax Free Investment Trust 803
-----------
Total Investment Companies (Cost $803) 803
-----------
Total Investments (Cost $84,846) 98.1% 83,483
-----------
Other Assets, less Liabilities 1.9% 1,641
-----------
TOTAL NET ASSETS 100.0% $85,124
===========
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BOND IMMDEX/TM FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
LONG-TERM INVESTMENTS 96.5%
ASSET-BACKED SECURITIES 4.2%
CREDIT CARD RECEIVABLES 3.0%
Chemical Master Credit Card Trust,
$ 1,520 Series 1995-3, Class A, 6.23%, 4/15/05 $ 1,508
Citibank Credit Card Master Trust I, Principal Only:
6,465 Series 1996-1, Class A, 0.00%, 2/07/01 5,955
5,000 Series 1997-6, Class A, 0.00%, 8/15/06 3,604
Household Affinity Credit Card Master Trust I,
3,750 Series 1993-2, Class A, 5.60%, 11/15/00 3,735
Sears Credit Account Master Trust,
1,062 Series 1995-2, Class A, 8.10%, 1/15/01 1,074
-----------
15,876
-----------
HOME EQUITY LOAN RECEIVABLES 1.2%
Contimortgage Home Equity Loan Trust:
1,050 Series 1998-1, Class A6, 6.58%, 12/15/18 1,032
3,000 Series 1997-3, Class A8, 7.58%, 8/15/28 2,995
Delta Funding Home Equity Loan Trust,
2,000 Series 1997-3, Class A6F, 6.86%, 10/25/28 1,974
-----------
6,001
-----------
CORPORATE BONDS 45.2%
Aetna Services, Inc. Debentures,
1,800 6.75%, 9/15/13 1,624
Air 2 US Bonds,
5,000 8.63%, 11/01/20
(Acquired 10/31/99, Cost $5,000)<F1> 5,000
Alabama Power Company First Mortgage Bond,
1,000 9.00%, 12/01/24 1,043
American Airline Equipment Pass-Thru Certificates,
1,500 10.21%, 1/01/10 1,710
America West Airlines Pass-Thru Certificates:
3,300 8.54%, 1/02/06 (Acquired 9/14/99, Cost $3,300)<F1> 3,300
3,000 7.93%, 1/02/19 (Acquired 9/14/99, Cost $3,000)<F1> 3,006
Associated P&C Holdings Senior Notes,
4,895 6.75%, 7/15/03 (Acquired 11/5/98, Cost $4,793)<F1> 4,719
BankAmerica Corporation Subordinated Notes,
3,539 10.00%, 2/01/03 3,852
BankBoston Notes,
2,500 6.375%, 4/15/08 2,349
Barclays North American Capital Corp. Debentures,
925 9.75%, 5/15/21 1,010
Conectiv, Inc. Medium Term Notes,
3,000 6.73%, 6/01/06 2,951
Continental Airlines, Inc. Pass-Thru Certificates,
2,655 6.80%, 7/02/07 2,566
Continental Bank Subordinated Notes,
1,963 12.50%, 4/01/01 2,121
Continental Cablevision, Inc. Debentures,
8,200 9.50%, 8/01/13 9,100
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
CORPORATE BONDS 45.2% (CONT.)
CSX Corporation, Medium Term Notes,
$ 3,000 5.85%, 12/01/03 $ 2,868
Duty Free International, Inc. Notes,
6,450 7.00%, 1/15/04 6,475
Dynegy Inc. Senior Notes,
2,600 7.45%, 7/15/06 2,582
Federal Express Corporation Debentures,
3,163 9.625%, 10/15/19 3,282
Federal Express Corporation Notes,
4,400 9.65%, 6/15/12 5,140
First National Bank Chicago Debentures,
1,350 8.08%, 1/05/18 1,408
First National Bank Omaha Subordinated Notes,
3,100 7.32%, 12/01/10 3,036
First Union Corporation Subordinated Notes,
3,000 8.125%, 6/24/02 3,096
First USA Bank Notes,
1,125 5.85%, 2/22/01 1,117
Ford Motor Company Debentures,
2,650 9.215%, 9/15/21 3,085
1,000 8.875%, 11/15/22 1,090
Geico Corporation Debentures,
2,000 9.15%, 9/15/21 2,161
General Motors Acceptance Corp. Notes,
2,694 9.625%, 12/15/01 2,850
Georgia Pacific Corp. Debentures:
1,511 9.50%, 12/01/11 1,710
4,605 9.875%, 11/01/21 4,966
975 9.50%, 5/15/22 1,059
Goldman Sachs Group Notes,
10,000 6.25%, 2/01/03 (Acquired 2/01/96; Cost $9,974)<F1> 9,738
GTE North, Inc. Debentures,
1,100 9.60%, 1/01/21 1,180
Harris Bankcorp Subordinated Notes,
1,065 9.375%, 6/01/01 1,109
Lehman Brothers Holdings, Inc. Medium Term Notes:
3,825 6.65%, 11/08/99 3,823
5,000 7.50%, 9/01/06 4,980
Lehman Brothers, Inc. Senior Subordinated Notes:
2,365 9.875%, 10/15/00 2,438
2,620 11.625%, 5/15/05 3,108
Lehman Brothers Holdings, Inc. Senior Notes,
1,500 8.75%, 5/15/02 1,558
Marlin Water Trust Senior Notes,
4,234 7.09%, 12/15/01 (Acquired 12/8/98, Cost $5,175)<F1> 4,218
The May Department Stores Company Debentures,
1,725 9.875%, 6/15/21 1,872
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BOND IMMDEX/TM FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
CORPORATE BONDS 45.2% (CONT.)
Merrill Lynch & Co. Medium Term Notes,
$ 5,000 5.88%, 1/15/04 $ 4,808
National Westminster Bancorp. Inc., Debentures,
1,000 9.375%, 11/15/03 1,079
NCNB Corp. Subordinated Notes,
5,155 10.20%, 7/15/15 6,373
Newcourt Credit Group Notes,
6,490 6.875%, 2/16/05 (Acquired 3/16/99, Cost $6,587)<F1> 6,422
News America Holdings Debentures,
2,200 10.125%, 10/15/12 2,410
Northwest Airlines Corp. Pass-Thru Certificates,
7,154 7.248%, 7/02/14 6,605
Old Dominion Electric Co-op First Mortgage,
6,850 8.76%, 12/01/22 7,201
Osprey Trust Secured Notes,
3,750 8.31%, 1/15/03 (Acquired 9/16/99, Cost $3,750)<F1> 3,744
Paine Webber Group, Inc. Notes:
2,500 6.45%, 12/01/03 2,423
2,450 6.73%, 1/20/04 2,391
1,540 8.875%, 3/15/05 1,635
Parker Hannifin Debentures,
400 9.75%, 2/15/21 427
Principal Financial Group Senior Notes,
7,000 8.20%, 8/15/09 (Acquired 8/18/99, Cost $6,979)<F1> 7,103
PSIEnergy, Inc. Debentures,
3,100 7.85%, 10/15/07 3,126
JC Penney Company, Inc. Debentures:
4,000 9.75%, 6/15/21 4,282
1,000 8.25%, 8/15/22 984
Salomon, Inc. Notes,
3,450 7.00%, 6/15/03 3,448
Salomon, Inc. Senior Notes,
2,100 6.75%, 2/15/03 2,085
Security Capital Group, Inc. Medium Term Notes,
2,850 7.75%, 11/15/03 2,791
Security Pacific Corporation Subordinated Notes,
742 11.50%, 11/15/00 777
Sprint Capital Corporation Company Guarantee,
5,250 5.70%, 11/15/03 5,035
Tenneco, Inc. Debentures,
3,150 7.45%, 12/15/25 2,925
Time Warner, Inc. Debentures,
2,200 9.125%, 1/15/13 2,478
Toll Road Investors Debentures, Principal Only,
5,800 0.00%, 2/15/04 (Acquired 4/23/99, Cost $4,339)<F1> 4,271
1,000 0.00%, 2/15/05 (Acquired 5/21/99, Cost $705)<F1> 678
Transamerica Finance Corporation Senior Notes,
5,675 6.125%, 11/01/01 5,574
Union Camp Corp. Debentures,
111 10.00%, 5/01/19 117
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
CORPORATE BONDS 45.2% (CONT.)
United HealthCare Corporation Notes,
$10,000 6.60%, 12/01/03
(Acquired 11/19/98, Cost $9,977)<F1> $ 9,754
U.S. West Communications Debentures,
1,000 8.875%, 6/01/31 1,040
Western National Corporation Senior Notes,
2,456 7.125%, 2/15/04 2,466
Westvaco Corp. Debentures,
1,200 10.125%, 6/01/19 1,257
Williams Companies, Inc. Notes,
2,675 7.625%, 7/15/19 2,608
Wisconsin Public Service,
2,000 8.80%, 9/01/21 2,110
-----------
234,727
-----------
MORTGAGE-BACKED SECURITIES 0.4%
Prudential Securities Secured Financing Corp.,
2,105 Series 1993-1, Class A, 6.44%, 2/16/21 2,078
-----------
INTERNATIONAL/YANKEE (U.S. $ DENOMINATED) 15.2%
Banco Santander-Chile Notes,
4,925 6.50%, 11/01/05 4,705
British Sky Brodcasting Company Guarantee,
5,000 6.875%, 2/23/09 4,450
Dresdner Bank Subordinated Debentures,
3,500 7.25%, 9/15/15 3,350
Ford Capital BV Debentures,
560 9.875%, 5/15/02 600
Ford Capital BV Notes:
4,072 10.125%, 11/15/00 4,225
4,025 9.375%, 5/15/01 4,194
1,400 9.50%, 6/01/10 1,608
Household Netherlands BV Company Guarantee,
10,000 6.20%, 12/01/03 9,728
Hydro-Quebec Corporation Debentures:
3,500 11.75%, 2/01/12 4,693
750 9.75%, 1/15/18 805
Korea Development Bank Bond:
2,300 7.125%, 9/17/01 2,280
3,600 7.90%, 2/01/02 3,602
Korea Electric Power Debentures:
2,020 7.75%, 4/01/13 1,837
1,400 6.75%, 8/01/27 1,310
Midland Bank PLC Subordinated Notes,
5,000 6.95%, 3/15/11 4,739
National Bank of Hungary Debentures,
2,490 8.875%, 11/01/13 2,694
Newfoundland (Province of) Canada,
1,975 10.00%, 12/01/20 2,434
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BOND IMMDEX/TM FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
INTERNATIONAL/YANKEE
(U.S. $ DENOMINATED) 15.2% (CONT.)
Norsk Hydro A/S Debentures,
$2,900 9.00%, 4/15/12 $ 3,241
Pohang Iron & Steel Notes,
1,575 7.125%, 7/15/04 1,502
Quebec Province Debentures,
2,000 11.00%, 6/15/15 2,126
Sanwa Bank Ltd. Subordinated Notes,
5,000 8.35%, 7/15/09 5,079
Sumitomo Bank International Guaranteed Notes,
3,000 8.50%, 6/15/09 3,100
Sweden (Kingdom of) Debentures,
1,100 11.125%, 6/01/15 1,503
Wharf Capital International Ltd. Notes:
2,700 8.875%, 11/01/04 2,678
2,675 7.625%, 3/13/07 2,404
-----------
78,887
-----------
U.S. GOVERNMENT AGENCY-BACKED
MORTGAGE ISSUES 5.5%
Federal Home Loan Mortgage Corporation (FHLMC),
74 Participation Certificates, 7.50%, 4/01/07 75
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC):
341 Series 6, Class C, 9.05%, 6/15/19 351
578 Series 1022, Class J, 6.00%, 12/15/20 558
56 Series 1169, Class D, 7.00%, 5/15/21 56
1,655 Series 162, Class F, 7.00%, 5/15/21 1,644
1,398 Series 1118, Class Z, 8.25%, 7/15/21 1,435
1,210 Series 188, Class H, 7.00%, 9/15/21 1,202
774 Series 1201, Class E, 7.40%, 12/15/21 780
1,336 Series 1790-A, Class A, 7.00%, 4/15/22 1,328
Federal National Mortgage Association (FNMA),
Participation Certificates:
259 Series 317, 7.50%, 8/01/07 263
84 Series 1464, 7.75%, 6/01/08 87
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC):
2 Series 1992-29, Class K, 77.917%, 11/25/00 7
15 Series 1992-145, Class N, 10.06%, 1/25/06 245
4,495 Series 1998-59, Class VA, 6.50%, 3/25/07 4,446
674 Series 1988-24, Class G, 7.00%, 10/25/18 665
675 Series 1989-44, Class H, 9.00%, 7/25/19 700
150 Series 1989-90, Class E, 8.70%, 12/25/19 155
675 Series 1990-30, Class E, 6.50%, 3/25/20 659
650 Series 1990-61, Class H, 7.00%, 6/25/20 646
Principal Amount Market Value
(in thousands) (in thousands)
------------- -------------
U.S. GOVERNMENT AGENCY-BACKED
MORTGAGE ISSUES 5.5% (CONT.)
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC) (cont.):
$ 380 Series 1990-72, Class B, 9.00%, 7/25/20 $ 394
517 Series 1990-102, Class J, 6.50%, 8/25/20 504
2,411 Series 1990-105, Class J, 6.50%, 9/25/20 2,357
415 Series 1990-106, Class J, 8.50%, 9/25/20 427
2,108 Series 1991-56, Class M, 6.75%, 6/25/21 2,060
904 Series 1992-120, Class C, 6.50%, 7/25/22 879
FDIC REMIC Trust,
6,492 Series 1996-C1, Class 1A, 6.75%, 5/25/26 6,436
-----------
28,359
-----------
U.S. TREASURY OBLIGATIONS 26.0%
U.S. Treasury Bonds:
650 10.75%, 8/15/05 792
14,550 9.875%, 11/15/15 19,379
94,380 9.25%, 2/15/16 115,013
-----------
135,184
-----------
Total Long-Term Investments (Cost $496,092) 501,112
-----------
Number
of Shares
(in thousands)
- --------------
SHORT-TERM INVESTMENTS 1.3%
INVESTMENT COMPANIES 1.3%
18 Financial Square Prime Obligation Fund 18
7,000 Short-Term Investments Co. Liquid Assets Portfolio 7,000
-----------
7,018
-----------
Total Short-Term Investments (Cost $7,018) 7,018
-----------
Total Investments (Cost $503,110) 97.8% 508,130
-----------
Other Assets, less Liabilities 2.2% 11,271
-----------
TOTAL NET ASSETS 100.0% $519,401
===========
<F1> Unregistered security
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
This page intentionally left blank.
<PAGE>
(LOGO) FIRSTAR FUNDS
December 1999
DEAR SHAREHOLDER:
INVESTMENT REVIEW
Money market funds generated strong total returns over the past 12 months and
continue to offer attractive inflation-adjusted yields. Short-term interest
rates were stable during much of the year but did succumb to volatility in the
financial markets over the past few months. Money market rates edged upward
recently as the Federal Reserve raised the Federal Funds rate .25% on June 30th
and again on August 24th. Overall, short-term yields rose from approximately
4.5% in October of 1998 to 5.3% in October of 1999. During this time period,
Firstar Money Market Funds were managed similarly to their respective
benchmarks, thereby offering principal stability and superior credit quality.
Firstar Money Market Funds are managed with quality and safety of principal as
primary goals. All securities purchased by the Funds must meet our internal high
standards for minimal credit risk and must also meet the strict guidelines set
by the Securities and Exchange Commission ("SEC"). Our credit research team
closely monitors all investments to ensure quality standards are met.
- --------------------------------------------------------------------------------
FIRSTAR MONEY MARKET FUNDS 7-DAY YIELDS
- --------------------------------------------------------------------------------
PERIOD ENDED OCTOBER 31, 1999
------------------------------
MONEY MARKET
FUND<F1>
CURRENT EFFECTIVE
4.82% 4.93%
------------------------------
------------------------------
INSTITUTIONAL
MONEY MARKET
FUND<F1>
CURRENT EFFECTIVE
5.25% 5.39%
------------------------------
------------------------------
TAX-EXEMPT
MONEY MARKET
FUND
CURRENT EFFECTIVE
2.66% 2.70%
------------------------------
------------------------------
U.S. GOVERNMENT
MONEY MARKET
FUND
CURRENT EFFECTIVE
4.60% 4.71%
------------------------------
------------------------------
U.S. TREASURY
MONEY MARKET
FUND<F1>
CURRENT EFFECTIVE
4.12% 4.21%
------------------------------
<F1> After fee waivers. Had fees not been waived, current and effective yields
would have been 4.69% and 4.80% for the Money Market Fund, 5.00% and 5.14%
for the Institutional Money Market Fund, and 4.10% and 4.19% for the U.S.
Treasury Money Market Fund. Reflects past performance; yields will vary. An
investment in any one of the Firstar Money Market Funds is neither insured
nor guaranteed by the U.S. Government nor is there any assurance the Funds
will be able to maintain a stable net asset value of $1.00 per share.
Current yield refers to income earned by a fund's investments over a 7-day
period. It is then annualized and stated as a percentage of the investment.
Effective yield is the same as current yield except that it assumes the
income earned by an investment in a fund will be reinvested.
<PAGE>
(LOGO) FIRSTAR FUNDS
FIRSTAR MONEY MARKET FUNDS YIELD COMPARISONS<F1>
<INSERT HEADERS HERE>
<TABLE>
<CAPTION>
IBC'S
MONEY
FIRSTAR FUND
IBC'S IBC'S TAX-EXEMPT AVERAGE/TM
MONEY IBC'S MONEY MONEY /ALL IBC'S
FUND INSTITUTIONAL FUND MARKET TAX-FREE FIRSTAR IBC'S FIRSTAR MONEY
AVERAGE FIRSTAR AVERAGE FIRSTAR AVERAGE TAX TAX U.S. MONEY U.S. FUND
FIRSTAR /TM INSTITUTIONAL /TM TAX-EXEMPT /TM EQUIVALENT EQIVALENT GOV'T. FUND TREASURY AVERAGE/TM
MONEY /ALL MONEY /ALL MONEY /ALL YIELD YIELD MONEY AVERAGE/TM MONEY /U.S.
MARKET TAXABLE MARKET TAXABLE MARKET TAX-FREE <F2> <F2> MARKET /GOV'T. MARKET TREASURY
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1999
October 4.79% 4.77% 5.12% 4.92% 2.67% 2.80% 4.17% 4.38% 4.50% 4.52% 4.11% 4.25%
- ------------------------------------------------------------------------------------------------------------------------------------
September 4.60% 4.69% 4.95% 4.85% 2.67% 2.80% 4.17% 4.30% 4.50% 4.49% 4.15% 4.25%
- ------------------------------------------------------------------------------------------------------------------------------------
August 4.42% 4.55% 4.79% 4.70% 2.43% 2.59% 3.80% 4.05% 4.39% 4.35% 4.01% 4.12%
- ------------------------------------------------------------------------------------------------------------------------------------
July 4.30% 4.45% 4.69% 4.61% 2.43% 2.50% 3.80% 3.91% 4.28% 4.25% 3.96% 4.04%
- ------------------------------------------------------------------------------------------------------------------------------------
June 4.18% 4.32% 4.58% 4.47% 2.57% 2.69% 4.02% 4.20% 4.08% 4.13% 3.85% 3.98%
- ------------------------------------------------------------------------------------------------------------------------------------
May 4.18% 4.29% 4.54% 4.46% 2.70% 2.83% 4.22% 4.42% 4.09% 4.12% 3.81% 3.93%
- ------------------------------------------------------------------------------------------------------------------------------------
April 4.19% 4.32% 4.56% 4.49% 2.44% 2.58% 3.81% 4.03% 4.13% 4.14% 3.87% 3.98%
- ------------------------------------------------------------------------------------------------------------------------------------
March 4.24% 4.35% 4.59% 4.52% 2.28% 2.44% 3.56% 3.81% 4.15% 4.17% 3.85% 4.00%
- ------------------------------------------------------------------------------------------------------------------------------------
February 4.31% 4.36% 4.65% 4.54% 2.00% 2.16% 3.13% 3.38% 4.17% 4.16% 3.76% 3.96%
- ------------------------------------------------------------------------------------------------------------------------------------
January 4.51% 4.46% 4.79% 4.61% 2.42% 2.56% 3.78% 4.00% 4.31% 4.21% 3.84% 3.99%
- ------------------------------------------------------------------------------------------------------------------------------------
1998
December 4.75% 4.54% 4.89% 4.68% 2.79% 2.69% 4.36% 4.20% 4.44% 4.29% 4.08% 4.02%
- ------------------------------------------------------------------------------------------------------------------------------------
November 4.79% 4.60% 4.98% 4.75% 2.66% 2.69% 4.16% 4.20% 4.49% 4.35% 4.11% 4.09%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
We compare our Funds to the IBC's Money Fund Averages, which are composites of
professionally managed money market investment funds with similar objectives.
<F1> After fee waivers. Had fees not been waived, performance would be reduced.
Reflects past performance; yields will vary. An investment in any one of
the Firstar Money Market Funds is neither insured nor guaranteed by the
U.S. Government nor is there any assurance the Funds will be able to
maintain a stable net asset value of $1.00 per share.
<F2> Assumes a 36% tax bracket.
LOOKING AHEAD - THE FORECAST
Looking ahead, we see continued economic growth and expect a slight increase in
short-term rates. We will maintain average maturities comparable to our industry
benchmarks. We continue to meet three important objectives for our money market
shareholders: preservation of principal, liquidity and competitive investment
income.
We appreciate your continued confidence in the Firstar Money Market Funds and
look forward to working with you in the future.
Carl J. Smith
Portfolio Manager
Firstar Investment Research & Management Company, LLC (FIRMCO)
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF ASSETS AND LIABILITIES
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
OCTOBER 31, 1999
TAX- U.S. U.S.
INSTITUTIONAL EXEMPT GOVERNMENT TREASURY
MONEY MONEY MONEY MONEY MONEY
MARKET MARKET MARKET MARKET MARKET
FUND FUND FUND FUND FUND
-------- -------- -------- -------- --------
ASSETS:
Investments, at
amortized cost $284,522 $2,364,308 $152,314 $209,715 $86,136
Cash - - 5 - -
Receivable for
securities matured - - - - 8,000
Interest receivable 267 1,508 1,349 292 1,814
Other 39 23 6 2 6
---------- ---------- ---------- ---------- ----------
Total Assets 284,828 2,365,839 153,674 210,009 95,956
---------- ---------- ---------- ---------- ----------
LIABILITIES:
Dividends payable 1,119 8,638 354 805 329
Payable to affiliates 205 792 113 174 75
Accrued expenses and
other liabilities 23 158 18 15 13
---------- ---------- ---------- ---------- ----------
Total Liabilities 1,347 9,588 485 994 417
---------- ---------- ---------- ---------- ----------
NET ASSETS $283,481 $2,356,251 $153,189 $209,015 $95,539
========== ========== ========== ========== ==========
CAPITAL STOCK,
$.0001 par value
Authorized 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000
Issued and
outstanding 283,481 2,356,251 153,189 209,015 95,539
NET ASSET VALUE,
REDEMPTION PRICE
AND OFFERING PRICE
PER SHARE $1.00 $1.00 $1.00 $1.00 $1.00
========== ========== ========== ========== ==========
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF OPERATIONS
(AMOUNTS IN THOUSANDS)
YEAR ENDED OCTOBER 31, 1999
TAX- U.S. U.S.
INSTITUTIONAL EXEMPT GOVERNMENT TREASURY
MONEY MONEY MONEY MONEY MONEY
MARKET MARKET MARKET MARKET MARKET
FUND FUND FUND FUND FUND
-------- -------- -------- -------- --------
INVESTMENT INCOME:
Interest income $ 14,699 $112,770 $ 4,455 $ 12,469 $ 4,978
---------- ---------- ---------- ---------- ----------
EXPENSES:
Investment
advisory fees 1,423 10,685 692 1,256 535
Administration fees 306 2,357 149 270 115
Service organization
fees 105 - - - -
Custody fees 39 302 25 36 13
Transfer agent fees
and expenses 273 77 31 33 31
Fund accounting fees 49 60 35 46 31
Professional fees 39 38 37 37 33
Reports to shareholders 149 13 9 19 5
Federal and state
registration fees 32 215 20 24 18
Directors' fees
and expenses 8 8 8 8 8
Other 7 29 3 7 2
---------- ---------- ---------- ---------- ----------
Total expenses
before waiver 2,430 13,784 1,009 1,736 791
Less: Waiver
of expenses (371) (5,373) (30) (37) (27)
---------- ---------- ---------- ---------- ----------
Net Expenses 2,059 8,411 979 1,699 764
---------- ---------- ---------- ---------- ----------
NET INVESTMENT INCOME $ 12,640 $104,359 $ 3,476 $ 10,770 $ 4,214
========== ========== ========== ========== ==========
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
INSTITUTIONAL TAX-EXEMPT
MONEY MARKET FUND MONEY MARKET FUND MONEY MARKET FUND
----------------------------- ----------------------------- -----------------------------
Year Year Year Year Year Year
ended ended ended ended ended ended
Oct. 31, 1999 Oct. 31, 1998 Oct. 31, 1999 Oct. 31, 1998 Oct. 31, 1999 Oct. 31, 1998
----------------------------- ----------------------------- -----------------------------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income $12,640 $13,157 $104,359 $64,761 $3,476 $3,271
----------- ----------- ----------- ----------- ----------- -----------
Net increase in net assets
resulting from
operations 12,640 13,157 104,359 64,761 3,476 3,271
----------- ----------- ----------- ----------- ----------- -----------
CAPITAL SHARE
TRANSACTIONS:
Shares sold 1,076,363 630,330 7,441,516 3,302,686 257,973 249,502
Shares issued to
owners in reinvestment
of dividends 12,321 11,254 4,367 5,039 1,319 1,158
Shares redeemed (1,094,291) (613,513) (6,713,602) (2,885,096) (228,554) (236,848)
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) (5,607) 28,071 732,281 422,629 30,738 13,812
----------- ----------- ----------- ----------- ----------- -----------
DIVIDENDS PAID FROM:
Net investment income (12,640) (13,157) (104,359) (64,761) (3,476) (3,271)
----------- ----------- ----------- ----------- ----------- -----------
TOTAL INCREASE (DECREASE)
IN NET ASSETS (5,607) 28,071 732,281 422,629 30,738 13,812
NET ASSETS:
Beginning of year 289,088 261,017 1,623,970 1,201,341 122,451 108,639
----------- ----------- ----------- ----------- ----------- -----------
End of year $283,481 $289,088 $2,356,251 $1,623,970 $153,189 $122,451
=========== =========== =========== =========== =========== ===========
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
U.S. GOVERNMENT U.S. TREASURY
MONEY MARKET FUND MONEY MARKET FUND
------------------- -------------------
Year Year Year Year
ended ended ended ended
Oct. 31, Oct. 31, Oct. 31, Oct. 31,
1999 1998 1999 1998
------------------- -------------------
OPERATIONS:
Net investment income $10,770 $9,683 $4,214 $3,579
---------- ---------- ---------- ----------
Net increase
in net assets
resulting from
operations 10,770 9,683 4,214 3,579
---------- ---------- ---------- ----------
CAPITAL SHARE
TRANSACTIONS:
Shares sold 891,590 829,540 345,253 266,098
Shares issued to
owners in reinvestment
of dividends 1,870 2,532 422 390
Shares redeemed (917,621) (797,563) (342,008) (253,094)
---------- ---------- ---------- ----------
Net increase (decrease) (24,161) 34,509 3,667 13,394
---------- ---------- ---------- ----------
DIVIDENDS PAID FROM:
Net investment income (10,770) (9,608) (4,214) (3,579)
---------- ---------- ---------- ----------
TOTAL INCREASE (DECREASE)
IN NET ASSETS (24,161) 34,584 3,667 13,394
NET ASSETS:
Beginning of year 233,176 198,592 91,872 78,478
---------- ---------- ---------- ----------
End of year $209,015 $233,176 $95,539 $91,872
========== ========== ========== ==========
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
Supplemental Data and Ratios
---------------------------------
Ratio
Dividends Net Net Ratio of Net
Net Asset from Asset Assets, of Net Investment
Value, Net Net Value, End of Expenses Income
Beginning Investment Investment End of Period to Average to Average Total
PER SHARE DATA of Period Income Income Period (000s) Net Assets Net Assets Return
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MONEY MARKET FUND
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995 $1.00 $0.05 $(0.05) $1.00 $172,261 0.60<F1> 5.36<F1> 5.51%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 1.00 0.05 (0.05) 1.00 224,036 0.60<F1> 4.94<F1> 5.06%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 1.00 0.05 (0.05) 1.00 261,017 0.60<F1> 4.98<F1> 5.12%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 1.00 0.05 (0.05) 1.00 289,088 0.60<F1> 5.05<F1> 5.16%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 1.00 0.04 (0.04) 1.00 283,481 0.72<F1> 4.44<F1> 4.52%
- --------------------------------------------------------------------------------------------------------------------------------
INSTITUTIONAL MONEY MARKET FUND
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995 1.00 0.06 (0.06) 1.00 716,566 0.35<F2> 5.63<F2> 5.77%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 1.00 0.05 (0.05) 1.00 750,051 0.35<F2> 5.19<F2> 5.32%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 1.00 0.05 (0.05) 1.00 1,201,341 0.35<F2> 5.23<F2> 5.38%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 1.00 0.05 (0.05) 1.00 1,623,970 0.35<F2> 5.30<F2> 5.41%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 1.00 0.05 (0.05) 1.00 2,356,251 0.38<F2> 4.76<F2> 4.85%
- --------------------------------------------------------------------------------------------------------------------------------
TAX-EXEMPT MONEY MARKET FUND
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995 1.00 0.03<F6> (0.03) 1.00 84,084 0.60<F3> 3.36<F3> 3.42%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 1.00 0.03<F6> (0.03) 1.00 79,328 0.60<F3> 3.09<F3> 3.13%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 1.00 0.03<F6> (0.03) 1.00 108,639 0.60<F3> 3.06<F3> 3.12%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 1.00 0.03<F6> (0.03) 1.00 122,451 0.60<F3> 3.02<F3> 3.04%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 1.00 0.03<F6> (0.03) 1.00 153,189 0.71<F3> 2.51<F3> 2.53%
- --------------------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT MONEY MARKET FUND
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995 1.00 0.05 (0.05) 1.00 163,068 0.60<F4> 5.24<F4> 5.37%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 1.00 0.05 (0.05) 1.00 198,334 0.60<F4> 4.84<F4> 4.96%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 1.00 0.05 (0.05) 1.00 198,592 0.60<F4> 4.83<F4> 4.99%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 1.00 0.05 (0.05) 1.00 233,176 0.60<F4> 4.90<F4> 4.97%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 1.00 0.04 (0.04) 1.00 209,015 0.68<F4> 4.30<F4> 4.37%
- --------------------------------------------------------------------------------------------------------------------------------
U.S. TREASURY MONEY MARKET FUND
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1995 1.00 0.05 (0.05) 1.00 64,655 0.60<F5> 5.04<F5> 5.16%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1996 1.00 0.05 (0.05) 1.00 53,430 0.60<F5> 4.70<F5> 4.80%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1997 1.00 0.05 (0.05) 1.00 78,478 0.60<F5> 4.67<F5> 4.80%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1998 1.00 0.05 (0.05) 1.00 91,872 0.60<F5> 4.62<F5> 4.71%
- --------------------------------------------------------------------------------------------------------------------------------
Year Ended October 31, 1999 1.00 0.04 (0.04) 1.00 95,539 0.71<F5> 3.94<F5> 4.01%
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<F1> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.85%, 0.86%, 0.84%, 0.81%, 0.90%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 4.31%, 4.79%, 4.73%,
4.73%, 5.06%, respectively.
<F2> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.62%, 0.64%, 0.66%, 0.64%, 0.69%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 4.52%, 5.01%, 4.92%,
4.90%, 5.29%, respectively.
<F3> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.73%, 0.75%, 0.75%, 0.78%, 0.84%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 2.49%, 2.87%, 2.91%,
2.91%, 3.12%, respectively.
<F4> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.69%, 0.71%, 0.70%, 0.71%, 0.75%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 4.29%, 4.79%, 4.73%,
4.73%, 5.09%, respectively.
<F5> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1999, 1998, 1997, 1996, 1995 would have been
0.74%, 0.77%, 0.78%, 0.80%, 0.83%, respectively; and ratios of net
investment income to average net assets for the fiscal years ended October
31, 1999, 1998, 1997, 1996, 1995 would have been 3.91%, 4.45%, 4.49%,
4.50%, 4.81%, respectively.
<F6> For the Tax-Exempt Money Market Fund, substantially all investment income
is exempt from federal income tax.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
MONEY MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
COMMERCIAL PAPER 88.5%
ASSET BACKED SECURITY 23.0%
Ciesco L.P.:
$ 7,000 5.33%, 12/08/99 $ 6,962
7,000 5.35%, 12/10/99 6,959
Corporate Asset Funding Co., Inc.:
7,000 5.34%, 11/04/99 6,997
6,000 5.95%, 1/14/00 5,927
CXC, Inc.,
6,000 5.35%, 11/19/99 5,984
Edison Asset Securitization, L.L.C.:
5,400 6.13%, 1/12/00 5,334
9,000 5.73%, 2/14/00 8,849
New Center Asset Trust,
7,000 5.34%, 12/22/99 6,947
Sheffield Receivables Corp.,
7,000 5.35%, 11/02/99 6,999
Toyota Auto Receivables Owner Trust,
4,295 5.37%, 8/15/00 4,295
-----------
65,253
-----------
AUTOS & TRUCKS 9.4%
Daimler Chrysler Holding Company,
7,000 5.95%, 1/18/00 6,910
Ford Motor Credit Company,
6,000 5.67%, 1/11/00 5,933
General Motors Acceptance Corporation,
7,000 5.31%, 12/14/99 6,956
Paccar Financial Corp,
7,000 5.30%, 12/16/99 6,954
-----------
26,753
-----------
BANKING - FOREIGN 7.0%
Dresdner US Finance, Inc.:
7,000 5.33%, 12/13/99 6,956
6,000 5.75%, 2/02/00 5,911
UBS Finance (Delaware), Inc.,
7,000 5.34%, 12/07/99 6,963
-----------
19,830
-----------
BASIC INDUSTRY 4.6%
Monsanto Company:
7,000 5.30%, 11/10/99 6,991
6,000 5.32%, 11/30/99 5,974
-----------
12,965
-----------
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
COMMUNICATIONS 2.5%
Bellsouth Capital Funding,
$ 7,000 5.29%, 12/09/99 $ 6,961
-----------
FINANCE - MISCELLANEOUS 4.6%
CIT Group Holdings, Inc.,
6,000 5.32%, 11/22/99 5,981
National Rural Utilities CFC,
7,000 5.29%, 11/02/99 6,999
-----------
12,980
-----------
FINANCE - SERVICES 14.3%
Goldman Sachs Group, L.P.:
7,000 5.38%, 11/05/99 6,996
7,000 6.00%, 1/21/00 6,905
Merrill Lynch and Co., Inc.:
8,000 5.30%, 11/15/99 7,984
5,000 5.00%, 2/08/00 4,931
Morgan Stanley, Dean Witter, Discover & Co.:
7,000 5.88%, 1/10/00 6,920
7,000 5.81%, 1/28/00 6,900
-----------
40,636
-----------
INSURANCE 14.3%
American Family Financial Services, Inc.,
7,000 5.32%, 12/01/99 6,969
John Hancock Capital Corporation,
7,000 5.30%, 12/23/99 6,946
Metlife Funding Inc.:
7,000 5.31%, 11/01/99 7,000
6,850 5.29%, 11/18/99 6,833
Prudential Funding Corporation:
6,000 5.21%, 11/08/99 5,994
7,000 6.02%, 1/26/00 6,899
-----------
40,641
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
MONEY MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
MACHINERY - AGRICULTURE AND CONSTRUCTION 2.1%
John Deere Capital Corporation,
$ 6,000 6.25%, 6/12/00 $ 6,017
-----------
MISCELLANEOUS 4.6%
Invensys PLC:
7,000 5.34%, 11/02/99 6,999
6,000 4.54%, 11/16/99 5,987
-----------
12,986
-----------
SOVEREIGN 2.1%
Quebec (Province of) Canada,
5,865 5.32%, 12/21/99 5,822
-----------
Total Commercial Paper 250,844
-----------
FUNDING AGREEMENTS 3.9%
Travelers Insurance Corporation:
4,000 5.52%, 2/18/00<F1> 4,000
7,000 6.10%, 6/30/00<F1> 7,000
-----------
Total Funding Agreements 11,000
-----------
Number of Shares Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
INVESTMENT COMPANIES 8.0%
9,573 Financial Square Prime Obligation Fund $9,573
13,105 Short-Term Investments Co. -
Liquid Assets Portfolio 13,105
-----------
Total Investment Companies 22,678
-----------
Total Investments 100.4% 284,522
-----------
Liabilities, less Other Assets (0.4)% (1,041)
-----------
NET ASSETS 100.0% $283,481
===========
<F1>Illiquid security
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
INSTITUTIONAL MONEY MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
COMMERCIAL PAPER 85.0%
ASSET BACKED SECURITIES 17.4%
Ciesco L.P.:
$ 50,000 5.32%, 11/08/99 $ 49,948
40,000 5.32%, 11/16/99 39,911
Corporate Asset Funding Co., Inc.:
40,000 5.34%, 11/19/99 39,893
28,000 5.37%, 12/02/99 27,871
CXC, Inc.:
50,000 5.32%, 11/01/99 50,000
40,000 6.07%, 1/25/00 39,427
Edison Asset Securitization, L.L.C.:
22,477 5.73%, 1/18/00 22,198
40,000 5.85%, 1/19/00 39,486
New Center Asset Trust:
40,000 5.31%, 11/12/99 39,935
40,000 5.32%, 12/16/99 39,734
Toyota Auto Receivables Owner Trust,
23,318 5.37%, 8/15/00 23,318
-----------
411,721
-----------
AUTO & TRUCKS 5.5%
Daimler Chrysler Holding Company,
50,000 5.94%, 1/27/00 49,282
Ford Credit Europe PLC:
40,000 5.18%, 11/18/99 39,902
40,000 5.29%, 12/03/99 39,812
-----------
128,996
-----------
BANKING - FOREIGN 11.2%
Deutsche Bank Financial, Inc.:
40,000 5.25%, 11/09/99 39,953
40,000 4.92%, 11/23/99 39,880
Dresdner US Finance, Inc.:
40,000 5.20%, 12/08/99 39,786
40,000 5.75%, 2/02/00 39,406
UBS Finance (Delaware), Inc.:
40,000 5.31%, 11/01/99 40,000
25,000 4.84%, 12/10/99 24,869
40,000 5.34%, 12/17/99 39,727
-----------
263,621
-----------
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
BASIC INDUSTRY 1.7%
Monsanto Company,
$ 40,000 5.32%, 12/01/99 $ 39,823
-----------
COMMUNICATIONS & MEDIA 5.7%
Bellsouth Capital Funding,
40,000 5.29%, 12/07/99 39,788
Gannett Company, Inc.
95,000 5.33%, 11/01/99 95,000
-----------
134,788
-----------
ENTERTAINMENT & LEISURE 3.0%
Walt Disney Company,
70,000 5.31%, 11/01/99 70,000
-----------
FINANCE - MISCELLANEOUS 10.6%
American Express Credit Company,
40,000 5.31%, 11/30/99 39,829
CIT Group Holding, Inc.:
45,000 5.31%, 11/29/99 44,814
45,000 5.31%, 12/23/99 44,655
General Electric Capital Corporation,
36,000 5.28%, 11/01/99 36,000
Household Finance Corporation:
45,000 5.15%, 12/13/99 44,730
40,000 5.71%, 1/28/00 39,442
-----------
249,470
-----------
FINANCE - SERVICES 11.2%
Goldman Sachs Group, L.P.,
40,000 5.30%, 11/24/99 39,865
Merrill Lynch & Company, Inc.:
36,000 5.31%, 11/01/99 36,000
20,000 5.32%, 11/02/99 19,997
40,000 5.32%, 2/01/00 39,456
40,000 5.25%, 2/14/00 39,388
Morgan Stanley, Dean Witter, Discovery & Co.:
50,000 5.92%, 1/19/00 49,350
40,000 5.77%, 1/21/00 39,481
-----------
263,537
-----------
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
INSTITUTIONAL MONEY MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
INSURANCE 11.2%
American General Corporation:
$40,000 5.34%, 11/04/99 $39,982
40,000 5.35%, 11/17/99 39,905
Metlife Funding Inc.:
50,000 5.30%, 11/03/99 49,985
40,000 5.30%, 11/05/99 39,976
Prudential Funding Corporation:
50,000 5.32%, 12/06/99 49,741
45,000 6.02%, 1/26/00 44,353
-----------
263,942
-----------
MACHINERY - AGRICULTURE AND CONSTRUCTION 1.9%
John Deere Capital Corporation,
45,000 5.29%, 12/14/99 44,716
-----------
MISCELLANEOUS 3.5%
Invensys PLC:
43,000 5.34%, 12/09/99 42,758
40,000 5.82%, 1/24/00 39,457
-----------
82,215
-----------
OIL AND GAS - SERVICES 1.0%
BP America Inc.,
25,000 4.86%, 1/18/00 24,737
-----------
SOVEREIGN 1.1%
Quebec (Province of) Canada,
25,000 4.85%, 11/22/99 24,929
-----------
Total Commercial Paper $2,002,495
-----------
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
FUNDING AGREEMENTS 3.3%
Travelers Insurance Company:
$36,000 5.52%, 2/18/00<F1> $36,000
43,000 6.10%, 6/30/00<F1> 43,000
-----------
Total Funding Agreements 79,000
-----------
U.S. GOVERNMENT AGENCIES 1.7%
Federal Home Loan Mortgage
Corporation Discount Notes,
40,000 5.23%, 12/17/99 39,733
-----------
Total U.S. Government Agencies 39,733
-----------
VARIABLE RATE DEMAND NOTES 0.8%
20,000 General Mills, Inc. 20,000
-----------
Total Variable Rate Demand Notes 20,000
-----------
Number
of Shares
(in thousands)
- ---------------
INVESTMENT COMPANIES 9.5%
107,351 Financial Square Premium Money Market Fund 107,351
115,729 Short-Term Investments Co. _
Liquid Assets Portfolio 115,729
-----------
Total Investment Companies 223,080
-----------
Total Investments 100.3% 2,364,308
-----------
Liabilities, less Other Assets (0.3)% (8,057)
-----------
NET ASSETS 100.0% $2,356,251
===========
<F1>Illiquid security
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
TAX-EXEMPTMONEY MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
GENERAL OBLIGATION 2.8%
Huntsville, Alabama,
$2,500 5.25%, 2/01/00 $ 2,513
Laredo, Texas,
1,630 6.75%, 8/01/00 1,664
Northwestern Mutual Life,
Tax Exempt Mortgage Certificates
1,108 4.50%, 2/15/09<F1><F2> 108
-----------
Total General Obligation 4,285
-----------
PREREFUNDED AND ESCROWED
TO MATURITY 22.0%
Allegheny County, Pennsylvania,
1,000 6.65%, 12/01/02, Prerefunded 12/01/99 1,003
Boston, Massachusetts, Hospital Revenue,
2,500 7.63%, 2/15/21, Prerefunded 8/15/00 2,614
Central Arizona, Water Conservation District,
5,175 7.13%, 11/01/11, Prerefunded 11/01/00 5,441
Chicago, Illinois, Waste Water Transmission,
2,000 7.10%, 11/15/08, Prerefunded 11/15/99 2,043
Chicago, Illinois, Water Revenue,
1,000 7.20%, 11/15/16, Prerefunded 11/15/99 1,021
Chillicothe, Ohio, Sanitary Sewer System,
1,000 7.65%, 12/01/08, Prerefunded 12/01/99 1,004
District of Columbia, Association of American
3,000 Medical Colleges 7.50%, 2/15/20, Prerefunded 2/15/00 3,096
Henrico County, Virginia, Hospital Revenue,
1,290 7.50%, 9/01/07, Prerefunded 8/01/00 1,350
Minneapolis, Minnesota,
1,500 5.30%, 11/01/99, Escrowed to Maturity 1,500
Mobile County, Alabama, General Obligation,
1,000 6.35%, 02/01/04, Prerefunded 2/01/00 1,028
Montgomery County, Pennsylvania,
1,580 8.63%, 7/01/07, Prerefunded 7/01/00 1,657
Northeast Independent School District, Texas,
1,900 6.00%, 6/15/00, Escrowed to Maturity 1,930
Pennsylvania State Turnpike,
1,000 7.50%, 12/01/12, Prerefunded 12/01/99 1,024
Rhode Island, Hospital Revenue,
1,000 7.75%, 7/01/16, Prerefunded 7/01/00 1,044
Scranton-Lackwana, Pennsylvania, Hospital Revenue,
1,520 7.25%, 6/15/05, Prerefunded 6/15/00 1,585
Tucson, Arizona, Street and Highway User Revenue,
1,000 6.88%, 7/01/08, Prerefunded 7/01/00 1,030
Walled Lake, Michigan, School District,
2,000 7.10%, 5/01/05, Prerefunded 5/01/00 2,077
Washington State Public Power, Revenue Bond,
3,225 7.25%, 7/01/15, Prerefunded 1/01/00 3,307
-----------
Total Prerefunded and Escrowed to Maturity 33,754
-----------
See notes to the financial statements.
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
REVENUE BONDS 73.1%
ELECTRIC REVENUE 6.9%
Chelan County, Washington, Public Utility,
$ 4,800 3.50%, 6/01/15<F1><F2> $ 4,800
County of Mason, Kentucky, Series 1984B,
1,950 3.60%, 10/15/14<F1><F2> 1,950
Putnam County, Florida Development Authority -
3,735 Seminole Electric, 3.60%, 3/15/14<F1><F2> 3,735
-----------
10,485
-----------
HOSPITAL REVENUE 24.6%
Illinois Health Facilities Authority,
2,500 Southern Illinois Healthcare Enterprises,
3.55%, 3/01/21<F1><F2> 2,500
Illinois Health Facilities Authority,
5,970 Recreational Facilities, 3.45%, 12/01/25<F1><F2> 5,970
Illinois Health Facilities Authority,
660 Franciscan Eldercare, 3.50%, 5/15/27<F1><F2> 660
Indiana Health Facilities Finance Authority -
1,500 King's Daughters' Hospital,
3.50%, 12/01/02<F1><F2> 1,500
Indiana Health Facilities Finance Authority -
3,400 Henry County Memorial Hospital,
3.50%, 4/01/13<F1><F2> 3,400
Indiana Health Facilities Finance Authority -
4,700 Hospital Revenue, 3.50%, 1/01/12<F1><F2> 4,700
Indiana Hospital Equipment Finance Authority,
4,200 Nursing Home Improvements, 3.50%, 12/01/15<F1><F2> 4,200
Jefferson Parish, Louisiana, Hospital,
4,600 3.50%, 12/01/15<F1><F2> 4,600
Warren County, Ohio, Health Care Facilities:
975 3.60%, 7/01/21<F1><F2> 975
1,535 3.55%, 7/01/23<F1><F2> 1,535
Wisconsin State Health & Educational Facilities -
1,900 Blood Center, 3.50%, 6/01/19<F1><F2> 1,900
Wisconsin State Health & Educational Facilities -
3,700 Marshfield Clinic, 3.45%, 6/01/10<F1><F2> 3,700
Wisconsin State Health & Educational Facilities -
2,109 Sinai Samaritan, 3.55%, 9/01/19<F1><F2> 2,109
-----------
37,749
-----------
HOUSING REVENUE 8.2%
Illinois Development Finance Authority -
3,230 St. Paul's House, 3.50%, 2/01/25<F1><F2> 3,230
Florida Housing Finance Agency -
3,000 Carlton Multi-Family, 3.50%, 12/01/08<F1><F2> 3,000
Orland Hills, Illinois, Multi-Family,
2,470 3.50%, 12/01/04<F1><F2> 2,470
Washington State Housing Finance - Community
3,930 Multi-Family Mortgage, 3.50%, 10/01/20<F1><F2> 3,930
-----------
12,630
-----------
<PAGE>
(LOGO) FIRSTAR FUNDS
TAX-EXEMPTMONEY MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
INDUSTRIAL DEVELOPMENT/POLLUTION
CONTROL REVENUE 7.4%
Mason County, Kentucky, Pollution Control,
$ 2,850 3.60%, 10/15/14<F1><F2> $ 2,850
Montgomery County, Ohio, Solid Waste Revenue,
1,785 5.00%, 11/01/99 1,785
Oakbrook Terrace, Illinois, Industrial Development,
4,100 3.70%, 12/01/25<F1><F2> 4,100
Oklahoma County, Oklahoma Finance Authority -
2,600 Perrine Office Project, 3.90%, 12/01/14<F1><F2> 2,600
-----------
11,335
-----------
MISCELLANEOUS 11.0%
Cleveland, Ohio
500 3.50%, 5/15/24<F1><F2> 500
Cook County, Illinois,
3,790 3.50%, 5/1/20<F1><F2> 3,790
Illinois Development Finance Authority,
3,900 Rest Haven, 3.50%, 1/01/27<F1><F2> 3,900
Illinois Development Finance Authority,
3,000 Presbyterian Home Lake-A, 3.50%, 9/01/31<F1><F2> 3,000
Illinois Education Facilities Authority,
2,000 Chicago Zoological Society, 3.50%, 12/15/25<F1><F2> 2,000
Jefferson County, Colorado, School District No. R-1
3,695 Certificates of Participation, 3.75%, 12/15/99 3,698
-----------
16,888
-----------
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
UNIVERSITY REVENUE 15.0%
Illinois Development Finance Authority -
$ 5,000 St. Ignatius College Prep,
3.50%, 6/01/24<F1><F2> $ 5,000
Minnesota State Higher Educational Authority,
3,345 Bethel College, 3.50%, 4/01/28<F1><F2> 3,345
Ohio State University, General Receipts
2,400 3.50%, 12/01/07<F1><F2> 2,400
Texas Higher Education Authority,
2,290 3.55%, 12/01/25<F1><F2> 2,290
University of Illinois, Series 1990A,
720 Certificates of Participation, 7.25%, 8/15/00 739
University of Minnesota, Series A,
4,000 3.55%, 1/01/34<F1><F2> 4,000
University of North Carolina, Chapel Hill Foundation
5,200 Certificates of Participation,
3.55%, 10/01/09<F1><F2> 5,200
-----------
22,974
-----------
Total Revenue Bonds 112,061
-----------
Number
of Shares
(in thousands)
- ---------------
INVESTMENT COMPANIES 1.5%
713 Financial Square Tax-Exempt Money Market Fund 713
299 Financial Square Treasury Obligations Fund 299
1,202 Tax Free Cash Reserves 1,202
-----------
Total Investment Companies 2,214
-----------
Total Investments 99.4% 152,314
-----------
Other Assets, less Liabilities 0.6% 875
-----------
NET ASSETS 100.0% $153,189
===========
<F1> Variable rate security
<F2> Stated maturity with option to put
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
U.S. GOVERNMENTMONEY MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- ---------------
U.S. GOVERNMENT AGENCIES 88.1%
FEDERAL FARM CREDIT BANK 28.3%
Federal Farm Credit Bank Discount Notes:
$ 9,641 5.20%, 11/04/99 $ 9,637
10,000 5.16%, 11/17/99 9,977
10,000 5.10%, 11/30/99 9,959
7,000 4.96%, 12/10/99 6,962
6,000 5.16%, 12/13/99 5,964
7,000 5.12%, 12/27/99 6,944
10,000 5.47%, 2/28/00 9,819
-----------
59,262
-----------
FEDERAL HOME LOAN MORTGAGE CORPORATION 30.3%
Federal Home Loan Mortgage Corporation Discount Notes:
5,000 5.20%, 11/01/99 5,000
8,000 5.09%, 11/02/99 7,999
8,500 5.20%, 11/04/99 8,496
10,000 5.19%, 11/05/99 9,993
8,000 5.10%, 11/09/99 7,991
10,000 5.09%, 12/15/99 9,938
7,000 5.23%, 12/17/99 6,953
7,000 5.42%, 2/10/00 6,894
-----------
63,264
-----------
FEDERAL NATIONAL MORTGAGE ASSN. 29.5%
Federal National Mortgage Assn. Discount Notes:
8,000 5.04%, 11/12/99 7,988
10,000 5.22%, 11/19/99 9,974
8,000 5.22%, 12/03/99 7,963
8,000 5.22%, 12/20/99 7,943
8,250 5.40%, 1/20/00 8,151
7,000 5.53%, 2/04/00 6,898
5,000 4.73%, 3/07/00 4,917
8,000 5.52%, 4/26/00 7,783
-----------
61,617
-----------
Total U.S. Government Agencies 184,143
-----------
U.S. TREASURIES 5.7%
U.S. TREASURY NOTES:
12,000 5.63%, 12/31/99 12,008
-----------
Total U.S. Treasuries 12,008
-----------
OCTOBER 31, 1999
Number of Shares Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
INVESTMENT COMPANIES 6.5%
7,476 Financial Square Government Obligation Fund $ 7,476
6,088 Short-Term Investments Co. Treasury Portfolio 6,088
-----------
Total Investment Companies 13,564
-----------
Total Investments 100.3% 209,715
-----------
Liabilities, less Other Assets (0.3)% (700)
-----------
NET ASSETS 100.0% $209,015
===========
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
U.S. TREASURY MONEY MARKET FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999
Principal Amount Amortized Cost
(in thousands) (in thousands)
- ---------------- --------------
U.S. TREASURIES 88.1%
U.S. TREASURY NOTES 73.6%
$17,000 5.88%, 11/15/99 $ 17,007
11,000 5.63%, 12/31/99 11,009
8,000 7.75%, 12/31/99 8,033
20,000 7.75%, 1/31/00 20,126
8,000 8.50%, 2/15/00 8,073
6,000 7.13%, 2/29/00 6,042
-----------
70,290
-----------
U.S. TREASURY BILLS 14.5%
4,000 4.33%, 11/12/99 3,994
10,000 4.96%, 1/20/00 9,890
-----------
13,884
-----------
Total U.S. Treasuries 84,174
-----------
Number
of Shares
(in thousands)
- ---------------
INVESTMENT COMPANIES 2.1%
1,952 Financial Square
Treasury Obligation Portfolio 1,952
10 Short-Term Investments Co.
Treasury Tax Advantage Portfolio 10
-----------
Total Investment Companies 1,962
-----------
Total Investments 90.2% 86,136
-----------
Other Assets, less Liabilities 9.8% 9,403
-----------
NET ASSETS 100.0% $ 95,539
===========
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTAR FUNDS
BALANCED INCOME FUND SHORT-TERM BOND MARKET FUND
BALANCED GROWTH FUND INTERMEDIATE BOND MARKET FUND
GROWTH AND INCOME FUND TAX-EXEMPT INTERMEDIATE BOND FUND
EQUITY INDEX FUND BOND IMMDEX/TM FUND
GROWTH FUND MONEY MARKET FUND
SPECIAL GROWTH FUND INSTITUTIONAL MONEY MARKET FUND
EMERGING GROWTH FUND TAX-EXEMPT MONEY MARKET FUND
MICROCAP FUND U.S. GOVERNMENT MONEY MARKET FUND
INTERNATIONAL EQUITY FUND U.S. TREASURY MONEY MARKET FUND
NOTES TO THE FINANCIAL STATEMENTS
1. ORGANIZATION
Firstar Funds, Inc. (the "Company") was incorporated on February 15, 1988,
as a Wisconsin Corporation and is registered as an open-end management
investment company under the Investment Company Act of 1940, as amended. The
Balanced Income, Balanced Growth, Growth and Income, Equity Index, Growth,
Special Growth, Emerging Growth, MicroCap, International Equity, Short-Term Bond
Market, Intermediate Bond Market, Tax-Exempt Intermediate Bond, Bond IMMDEX/TM,
Money Market, Institutional Money Market, Tax-Exempt Money Market, U.S.
Government Money Market and U.S. Treasury Money Market Funds (the "Funds"), are
separate, diversified investment portfolios of the Company. The Money Market
Fund commenced operations on March 16, 1988; the Tax-Exempt Money Market Fund
commenced operations on June 27, 1988; the U.S. Government Money Market Fund
commenced operations on August 1, 1988; the Special Growth Fund commenced
operations on December 28, 1989; the Short-Term Bond Market Fund, Bond IMMDEX/TM
Fund, Growth and Income Fund and Equity Index Fund commenced operations on
December 29, 1989; the Institutional Money Market Fund commenced operations on
April 26, 1991; the U.S. Treasury Money Market Fund commenced operations on
April 29, 1991; the Balanced Growth Fund commenced operations on March 30, 1992;
the Growth Fund commenced operations on December 29, 1992; the Intermediate Bond
Market Fund commenced operations on January 5, 1993; the Tax-Exempt Intermediate
Bond Fund commenced operations on February 8, 1993; the International Equity
Fund commenced operations on April 28, 1994; the MicroCap Fund commenced
operations on August 1, 1995; the Emerging Growth Fund commenced operations on
August 15, 1997; and the Balanced Income Fund commenced operations on December
1, 1997. The objective of the Short-Term Bond Market Fund is to seek to provide
an annual rate of total return, before Fund expenses, comparable to the annual
rate of total return of the Lehman Brothers 1-3 year Government/Corporate Bond
Index. The objective of the Intermediate Bond Market Fund is to seek to provide
an annual rate of total return, before Fund expenses, comparable to the annual
rate of total return of the Lehman Brothers Intermediate Government/Corporate
Bond Index. The objective of the Tax-Exempt Intermediate Bond Fund is to seek to
provide current income that is substantially exempt from federal income tax and
emphasize total return with relatively low volatility of principal. The
objective of the Bond IMMDEX/TM Fund is to seek to provide an annual rate of
total return, before Fund expenses, comparable to the annual rate of total
return of the Lehman Brothers Government/Corporate Bond Index. The objective of
the Balanced Income Fund is to seek current income and the preservation of
capital through investment in a balanced portfolio of dividend paying equity and
fixed income securities. The objective of the Balanced Growth Fund is to achieve
a balance of capital appreciation and current income with relatively low
volatility of capital. The objective of the Growth and Income Fund is to seek
both reasonable income and long-term capital appreciation. The objective of the
Equity Index Fund is to seek returns, before Fund expenses, comparable to the
price and yield performance of publicly traded common stocks in the aggregate,
as represented by the S&P 500 Stock Index. The objective of the Growth Fund is
capital appreciation through investment in securities of medium- to large-sized
companies. The objective of the Special Growth Fund is capital appreciation
through investment in securities of medium-sized companies. The objective of the
Emerging Growth Fund is capital appreciation through investments in securities
of small-sized companies. The objective of the MicroCap Fund is capital
appreciation through investments in small companies. The objective of the
International Equity Fund is to seek capital appreciation through investment in
foreign securities which the Sub-Advisor believes are undervalued.
The costs, in thousands, incurred in connection with the organization,
initial registration and public offering of shares aggregating $47, $21, $24 and
$27 for the Balanced Income, Emerging Growth, MicroCap and International Equity
Funds, respectively, have been paid by the respective Funds. These costs are
being amortized over the period of benefit, but not to exceed sixty months from
each Fund's commencement of operations.
The Company has issued three classes of Fund shares in each of the non-money
market funds: Series A, Series B and Series Institutional. The Series A shares
are subject to a 0.25% service organization fee and an initial sales charge
imposed at the time of purchase, in accordance with the Funds' prospectus. The
maximum sales charge on Series A shares purchased in the Short-Term Bond Market,
Intermediate Bond Market, Tax-Exempt Intermediate Bond, and Bond IMMDEX/TM Fund,
is 3.75% of the offering price or 3.90% of the net asset value. The
<PAGE>
(LOGO) FIRSTAR FUNDS
maximum sales charge on Series A shares purchased in the Balanced Income,
Balanced Growth,Growth and Income, Equity Index, Growth, Special Growth,
Emerging Growth, MicroCap and International Equity Funds is 4.50% of the
offering price or 4.71% of the net asset value. The Series B shares are subject
to a 0.25% service organization fee and a 0.75% distribution and service (12b-1)
fee. The B shares are also subject to a contingent deferred sales charge at the
time of redemption, in accordance with the Funds' prospectus. The maximum sales
charge is 5% for redemptions in the first year, 4% in the second year, 3% in the
third and fourth years, 2% in the fifth year, 1% in the sixth year and 0%
thereafter. Each class of shares for each non-Money Market Fund has identical
rights and privileges except with respect to service organization fees paid by
Series A and Series B shares, voting rights on matters affecting a single class
of shares and the exchange privileges of each class of shares.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. These
policies are in conformity with generally accepted accounting principles.
a) Investment Valuation - Securities which are traded on a recognized stock
exchange are valued at the last sale price on the securities exchange on which
such securities are primarily traded or at the last sale price on a national
securities exchange. Exchange-traded securities for which there were no
transactions are valued at the current bid prices, with the exception of the
International Equity Fund, which is valued at the average of the current bid and
asked prices. Securities traded on only over-the-counter markets are valued on
the basis of closing over-the-counter bid prices. Investments in the money
market funds and instruments with a maturity of 60 days or less are valued on
the basis of amortized cost for financial reporting purposes and federal income
tax purposes, which approximates market value. Variable rate demand notes and
funding agreements are valued at cost which approximates market value.
Investment companies are valued at net asset value which approximates market
value. Securities for which market quotations are not readily available and
other assets are valued at fair market value as determined by the investment
adviser under the supervision of the Board of Directors. At October 31, 1999,
the Short-Term Bond Market Fund and MicroCap Fund each held one such security
which represented 0.01% of investments, respectively, at value. Portfolio
securities which are primarily traded on foreign securities exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, except when an occurrence subsequent to the time a value
was so established is likely to have changed such value. In such an event, the
fair value of those securities is determined through the consideration of other
factors by or under the direction of the Board of Directors. Quotations of
foreign securities in foreign currency are converted to United States ("U.S.")
dollar equivalents using the foreign exchange quotation in effect at the time
net asset value is computed. Foreign securities held by the International Equity
Fund may trade in their local markets on days the U.S. exchanges are closed, and
the International Equity Fund's net asset value may, therefore, change on days
when investors may not purchase or redeem Fund shares.
b) Federal Income Taxes - It is each Fund's policy to meet the requirements of
the Internal Revenue Code applicable to regulated investment companies and each
Fund intends to distribute substantially all investment company net taxable
income and net capital gains to shareholders. Therefore, no federal income tax
provision is required.
c) Income and Expenses - The Funds are charged for those expenses that are
directly attributable to each portfolio, such as advisory, administration and
certain shareowner service fees. Expenses that are not directly attributable to
a portfolio are typically allocated among the Company's portfolios in proportion
to their respective net assets, number of shareholder accounts, or net sales,
where applicable. For Funds with more than one class of shares, net investment
income other than class specific expenses, and realized and unrealized gains and
losses are allocated daily to each class of shares based upon the relative net
asset value of outstanding shares of each class of shares at the beginning of
the day (after adjusting for the current day's capital share activity of the
respective class).
d) Distributions to Shareholders - Dividends from net investment income of the
Money Market, Tax-Exempt Money Market, U.S. Government Money Market, U.S.
Treasury Money Market and the Institutional Money Market Funds are declared
daily and paid monthly. Dividends from net investment income of the Short-Term
Bond Market, Intermediate Bond Market, Tax-Exempt Intermediate Bond and Bond
IMMDEX/TM Funds are declared and paid monthly. Dividends from net investment
income, if any, are declared and paid quarterly for the Balanced Income,
Balanced Growth, Growth and Income and Equity Index Funds and annually for the
Growth, Special Growth, Emerging Growth, MicroCap and International Equity
Funds. Distributions of net realized capital gains, if any, will be declared at
least annually. Certain Funds may also utilize earnings and profits distributed
to shareholders on redemption of shares as part of the dividends paid deduction.
Accordingly, reclassifications are made within the net asset accounts for such
amounts, as well as amounts related to permanent differences in the character of
certain income and expense items for income tax and financial reporting
purposes.
e) Futures Contracts - The Equity Index Fund may utilize futures contracts to a
limited extent. The risk associated with the use of futures contracts includes
the possibility of an illiquid market. Futures contracts are valued based upon
their quoted daily settlement prices. Changes in initial settlement value are
accounted for as unrealized appreciation (depreciation) until the contracts are
terminated at which time realized gains and losses are recognized.
f) When-Issued Securities - The Tax-Exempt Money Market, Balanced Income,
Balanced Growth, Growth and Income, Equity Index, Growth, Special Growth,
Emerging Growth, MicroCap, International Equity, Short-Term Bond Market,
Intermediate Bond Market, Tax-Exempt Intermediate Bond, and Bond IMMDEX/TM Funds
may purchase securities on a when-issued or delayed delivery basis. Although the
payment and interest terms of these securities are established at the time the
purchaser enters into the agreement, these securities may be delivered and paid
for at a future date, generally within 45 days. Each of these Funds records
purchases of when-issued securities and reflects the values of such securities
in determining net asset value in the same manner as other portfolio securities.
Each of these Funds identifies and maintains at all times cash, cash
equivalents, or other liquid securities in an amount at least equal to the
amount of outstanding commitments of when-issued securities.
g) Use of Estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
h) Foreign Currency Translations - The books and records of the International
Equity Fund are maintained in U.S.dollars. Foreign currencies, investments, and
other assets and liabilities denominated in foreign currencies are translated
into U.S. dollars at the exchange rates prevailing at the end of the period, and
purchases and sales of investment securities, and income and expenses
denominated in foreign currencies are translated on the respective dates of such
transactions. Unrealized gains and losses on investments which result from
changes in foreign currency exchange rates have been included in the unrealized
net appreciation (depreciation) on investments. Foreign currency exchange gains
and losses included in net appreciation (depreciation) on foreign currency and
net realized gains and losses on foreign currency include foreign currency gains
and losses between trade date and settlement date on investment securities
transactions and foreign currency transactions; such amounts are considered net
investment income (loss) for tax purposes. The portion of the foreign currency
gains and losses related to fluctuation in exchange rates between the initial
purchase date and subsequent sale date of a security is included in realized
gains and losses on investment transactions.
i) Other - Investment and shareholder transactions are recorded on the trade
date. Dividend income is recognized on the ex-dividend date or as soon as
information is available to the Funds. Interest income is recognized on an
accrual basis. Discounts and premiums on securities are amortized over the life
of the respective security. Discounts and premiums on securities with put
provisions are amortized to the earlier of the put date or maturity.Realized
gains and losses from investment transactions are determined by comparing the
net sale proceeds to an identified cost basis. Transactions in capital shares at
$1.00 per share for the money market funds are shown in the Statement of Changes
in Net Assets.
<PAGE>
(LOGO) FIRSTAR FUNDS
3. CAPITAL SHARE TRANSACTIONS
Transactions, in thousands, of shares of the Funds were as follows:
<TABLE>
<CAPTION>
BALANCED INCOME BALANCED GROWTH GROWTH AND INCOME
FUND FUND FUND
------------------------ ------------------------ ------------------------
Amount Shares Amount Shares Amount Shares
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
YEAR ENDED OCTOBER 31, 1999:
Series A shares:
Shares sold $ 5,020 454 $ 6,468 210 $ 26,309 570
Shares issued to owners in
reinvestment of dividends 731 66 2,840 92 15,257 332
Shares redeemed (3,181) (289) (15,607) (513) (44,599) (973)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) $ 2,570 231 $ (6,299) (211) $ (3,033) (71)
========= ========= ========= ========= ========= =========
Series B shares:
Shares sold $ 1,591 145 $ 649 21 $ 1,606 35
Shares issued to owners in
reinvestment of dividends 9 1 2 0 1 0
Shares redeemed (28) (3) (14) 0 (36) (1)
--------- --------- --------- --------- --------- ---------
Net increase $ 1,572 143 $ 637 21 $ 1,571 34
========= ========= ========= ========= ========= =========
Series Institutional shares:
Shares sold $ 25,571 2,342 $ 57,953 1,893 $151,499 3,290
Shares issued to owners in
reinvestment of dividends 607 55 9,563 310 34,560 750
Shares redeemed (10,418) (949) (75,558) (2,501) (146,699) (3,196)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) $ 15,760 1,448 $ (8,042) (298) $ 39,360 844
========= ========= ========= ========= ========= =========
YEAR ENDED OCTOBER 31, 1998<F1>:
Series A shares:
Shares sold $ 11,352 1,046 $ 19,603 660 $ 59,834 1,359
Shares issued to owners in
reinvestment of dividends 123 11 4,639 163 5,908 146
Shares redeemed (993) (92) (7,945) (266) (21,073) (483)
--------- --------- --------- --------- --------- ---------
Net increase $ 10,482 965 $ 16,297 557 $ 44,669 1,022
========= ========= ========= ========= ========= =========
Series Institutional shares:
Shares sold $ 36,380 3,540 $ 63,126 2,111 $156,883 3,600
Shares issued to owners in
reinvestment of dividends 71 7 17,086 600 15,009 369
Shares redeemed (4,936) (456) (52,956) (1,798) (114,144) (2,614)
--------- --------- --------- --------- --------- ---------
Net increase $ 31,515 3,091 $ 27,256 913 $ 57,748 1,355
========= ========= ========= ========= ========= =========
</TABLE>
<F1> Capital share activity is for the fiscal year ended October 31, 1998 for
the Balanced Growth Fund and Growth and Income Fund, and for the period
December 1, 1997 (commencement of operations) to October 31, 1998 for the
Balanced Income Fund.
<PAGE>
(LOGO) FIRSTAR FUNDS
3. CAPITAL SHARE TRANSACTIONS (CONT.)
Transactions, in thousands, of shares of the Funds were as follows:
<TABLE>
<CAPTION>
EQUITY INDEX GROWTH SPECIAL GROWTH
FUND FUND FUND
------------------------ ------------------------ ------------------------
Amount Shares Amount Shares Amount Shares
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
YEAR ENDED OCTOBER 31, 1999:
Series A shares:
Shares sold $ 32,030 378 $ 13,457 359 $ 10,459 266
Shares issued to owners in
reinvestment of dividends 1,948 23 4,322 117 1,072 26
Shares redeemed (27,974) (329) (11,168) (301) (53,329) (1,380)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) $ 6,004 72 $ 6,611 175 $ (41,798) (1,088)
========= ========= ========= ========= ========= =========
Series B shares:
Shares sold $ 4,598 51 $ 745 20 $ 176 4
Shares issued to owners in
reinvestment of dividends 8 0 0 0 0 0
Shares redeemed (96) (1) (24) (1) (51) (1)
--------- --------- --------- --------- --------- ---------
Net increase $ 4,510 50 $ 721 19 $ 125 3
========= ========= ========= ========= ========= =========
Series Institutional shares:
Shares sold $ 304,539 3,463 $ 204,039 5,432 $ 245,028 6,379
Shares issued to owners in
reinvestment of dividends 7,889 92 18,176 486 3,350 80
Shares redeemed (294,685) (3,440) (127,316) (3,421) (358,282) (9,295)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) $ 17,743 115 $ 94,899 2,497 $(109,904) (2,836)
========= ========= ========= ========= ========= =========
YEAR ENDED OCTOBER 31, 1998:
Series A shares:
Shares sold $ 30,526 428 $ 12,906 367 $ 34,361 820
Shares issued to owners in
reinvestment of dividends 2,500 37 3,577 118 14,452 357
Shares redeemed (14,683) (206) (4,328) (135) (36,981) (878)
--------- --------- --------- --------- --------- ---------
Net increase $ 18,343 259 $ 12,155 350 $ 11,832 299
========= ========= ========= ========= ========= =========
Series Institutional shares:
Shares sold $ 154,182 2,167 $ 55,749 1,622 $ 115,060 2,750
Shares issued to owners in
reinvestment of dividends 10,229 150 20,361 665 50,064 1,228
Shares redeemed (88,691) (1,252) (66,140) (1,919) (188,422) (4,477)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) $ 75,720 1,065 $ 9,970 368 $ (23,298) (499)
========= ========= ========= ========= ========= =========
</TABLE>
<PAGE>
(LOGO) FIRSTAR FUNDS
3. CAPITAL SHARE TRANSACTIONS (CONT.)
Transactions, in thousands, of shares of the Funds were as follows:
<TABLE>
<CAPTION>
EMERGING GROWTH MICROCAP INTERNATIONAL
FUND FUND FUND
------------------------ ------------------------ ------------------------
Amount Shares Amount Shares Amount Shares
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
YEAR ENDED OCTOBER 31, 1999:
Series A shares:
Shares sold $ 3,655 379 $ 8,724 596 $ 1,394 81
Shares issued to owners in
reinvestment of dividends 15 1 42 3 122 8
Shares redeemed (6,228) (657) (9,284) (594) (2,781) (171)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) $ (2,558) (277) $ (518) 5 $ (1,265) (82)
========= ========= ========= ========= ========= =========
Series B shares:
Shares sold $ 91 10 $ 119 6 $ 43 2
Shares issued to owners in
reinvestment of dividends 0 0 0 0 0 0
Shares redeemed (10) (1) 0 0 0 0
--------- --------- --------- --------- --------- ---------
Net increase $ 81 9 $ 119 6 $ 43 2
========= ========= ========= ========= ========= =========
Series Institutional shares:
Shares sold $137,021 14,295 $ 44,207 2,966 $ 18,830 1,077
Shares issued to owners in
reinvestment of dividends 56 5 222 16 569 37
Shares redeemed (54,262) (5,665) (31,952) (1,964) (18,366) (1,125)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) $ 82,815 8,635 $ 12,477 1,018 $ 1,033 (11)
========= ========= ========= ========= ========= =========
YEAR ENDED OCTOBER 31, 1998:
Series A shares:
Shares sold $ 10,119 969 $ 1,418 80 $ 3,333 190
Shares issued to owners in
reinvestment of dividends 45 5 1,570 99 162 9
Shares redeemed (1,504) (145) (2,049) (137) (2,075) (122)
--------- --------- --------- --------- --------- ---------
Net increase $ 8,660 829 $ 939 42 $ 1,420 77
========= ========= ========= ========= ========= =========
Series Institutional shares:
Shares sold $ 30,325 2,998 $ 1,819 125 $ 13,322 748
Shares issued to owners in
reinvestment of dividends 307 32 7,878 492 1,085 63
Shares redeemed (13,394) (1,384) (10,986) (706) (15,171) (952)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) $ 17,238 1,646 $ (1,289) (89) $ (764) (141)
========= ========= ========= ========= ========= =========
</TABLE>
<PAGE>
(LOGO) FIRSTAR FUNDS
3. CAPITAL SHARE TRANSACTIONS (CONT.)
Transactions, in thousands, of shares of the Funds were as follows:
<TABLE>
<CAPTION>
SHORT-TERM INTERMEDIATE TAX-EXEMPT BOND
BOND MARKET BOND MARKET INTERMEDIATE IMMDEX/TM
FUND FUND BOND FUND FUND
------------------ ------------------ ------------------ ------------------
Amount Shares Amount Shares Amount Shares Amount Shares
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
YEAR ENDED OCTOBER 31, 1999:
Series A shares:
Shares sold $16,593 1,613 $ 11,144 1,076 $ 10,448 996 $ 27,886 980
Shares issued to owners in
reinvestment of dividends 3,684 361 1,312 128 1,102 106 5,101 182
Shares redeemed (28,615) (2,795) (6,903) (671) (22,903) (2,210) (26,725) (951)
-------- -------- -------- -------- -------- -------- -------- --------
Net increase (decrease) $(8,338) (821) $ 5,553 533 $(11,353) (1,108) $ 6,262 211
======== ======== ======== ======== ======== ======== ======== ========
Series B shares:
Shares sold $523 51 $298 29 $ 74 7 $2,003 72
Shares issued to owners in
reinvestment of dividends 11 1 5 0 1 0 38 1
Shares redeemed (11) (1) (92) (9) 0 0 (128) (5)
-------- -------- -------- -------- -------- -------- -------- --------
Net increase $523 51 $211 20 $75 7 $1,913 68
======== ======== ======== ======== ======== ======== ======== ========
Series Institutional shares:
Shares sold $36,523 3,563 $ 59,956 5,810 $20,125 1,936 $161,261 5,691
Shares issued to owners in
reinvestment of dividends 5,004 512 9,542 986 754 73 19,616 698
Shares redeemed (28,833) (2,841) (65,622) (6,392) (19,735) (1,896) (205,542) (7,220)
-------- -------- -------- -------- -------- -------- -------- --------
Net increase (decrease) $12,694 1,234 $ 3,876 404 $1,144 113 $(24,665) (831)
======== ======== ======== ======== ======== ======== ======== ========
YEAR ENDED OCTOBER 31, 1998:
Series A shares:
Shares sold $31,426 3,052 $11,695 1,126 $24,340 2,333 $40,062 1,403
Shares issued to owners in
reinvestment of dividends 3,639 355 939 91 945 91 3,926 138
Shares redeemed (25,689) (2,499) (4,255) (411) (12,427) (1,191) (15,244) (534)
-------- -------- -------- -------- -------- -------- -------- --------
Net increase $9,376 908 $8,379 806 $12,858 1,233 $ 28,744 1,007
======== ======== ======== ======== ======== ======== ======== ========
Series Institutional shares:
Shares sold $45,856 4,455 $82,249 7,928 $34,464 3,306 $148,842 5,214
Shares issued to owners in
reinvestment of dividends 4,729 440 8,771 792 678 65 21,598 759
Shares redeemed (66,755) (6,475) (59,461) (5,674) (21,832) (2,098) (120,508) (4,217)
-------- -------- -------- -------- -------- -------- -------- --------
Net increase (decrease) $ (16,170) (1,580) $ 31,559 3,046 $13,310 1,273 $49,932 1,756
======== ======== ======== ======== ======== ======== ======== ========
</TABLE>
<PAGE>
(LOGO) FIRSTAR FUNDS
4. INVESTMENT TRANSACTIONS
The aggregate purchases and sales, in thousands, of securities, excluding
short-term investments, for the Funds for the period ending October 31, 1999,
were as follows:
<TABLE>
<CAPTION>
BALANCED BALANCED GROWTH AND EQUITY GROWTH SPECIAL EMERGING
INCOME FUND GROWTH FUND INCOME FUND INDEX FUND FUND GROWTH FUND GROWTH FUND
------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Purchases:
U.S. Government $10,103 $ 10,882 - - - - -
Other 29,930 158,075 $470,092 $110,178 $248,920 $707,647 $212,467
Sales:
U.S. Government $5,342 $ 13,575 - - - - -
Other 17,327 154,226 $429,957 $86,108 $170,837 $827,211 $129,920
</TABLE>
<TABLE>
<CAPTION>
SHORT-TERM INTERMEDIATE TAX-EXEMPT BOND
MICROCAP INTERNATIONAL BOND MARKET BOND MARKET INTERMEDIATE IMMDEX/TM
FUND EQUITY FUND FUND FUND BOND FUND FUND
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Purchases:
U.S. Government - - $32,838 $ 73,781 - $ 89,663
Other $260,622 $22,796 75,870 128,030 $20,299 199,190
Sales:
U.S. Government - - $32,471 $122,602 - $165,609
Other $247,561 $24,572 68,948 70,402 $24,593 145,380
</TABLE>
Equity Index Fund transactions in futures contracts during the period October
31, 1998 to October 31, 1999, in thousands, were as follows:
AGGREGATE
NUMBER OF FACE VALUE OF
CONTRACTS CONTRACTS <F1>
Outstanding at October 31, 1998 100 $ 25,845
Contracts opened 1,135 371,054
Contracts closed (1,138) (364,631)
----------- -----------
Outstanding at October 31, 1999 97 $ 32,268
=========== ===========
<F1> The aggregate face value of contracts is computed on the date each contract
is opened.
The number of futures contracts and net unrealized appreciation, in thousands,
as of October 31, 1999, were as follows:
NUMBER OF UNREALIZED
CONTRACTS APPRECIATION
S&P 500 Financial Futures Contract
Expiration date 12/99<F2> 97 $1,104
<F2> At October 31, 1999, U.S. Treasury Bills of $3,579, in thousands, were held
as collateral by the custodian in an initial margin account in connection
with open futures contracts held by the Equity Index Fund.
<PAGE>
(LOGO) FIRSTAR FUNDS
At October 31, 1999, gross unrealized appreciation and depreciation of
investments for federal tax purposes, in thousands, were as follows:
<TABLE>
<CAPTION>
BALANCED BALANCED GROWTH AND EQUITY GROWTH SPECIAL EMERGING
INCOME FUND GROWTH FUND INCOME FUND INDEX FUND FUND GROWTH FUND GROWTH FUND
------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Appreciation $ 7,818 $45,077 $212,564 $363,802 $102,454 $118,955 $ 20,651
(Depreciation) (1,011) (8,768) (9,928) (21,747) (9,246) (9,372) (10,892)
--------- --------- --------- --------- --------- --------- ---------
Net unrealized
appreciation
(depreciation)
on investments $6,807 $36,309 $202,636 $342,055 $ 93,208 $109,583 $ 9,759
========= ========= ========= ========= ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
SHORT-TERM INTERMEDIATE TAX-EXEMPT BOND
MICROCAP INTERNATIONAL BOND MARKET BOND MARKET INTERMEDIATE IMMDEX/TM
FUND EQUITY FUND FUND FUND BOND FUND FUND
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Appreciation $ 49,524 $ 10,464 $ 150 $ 1,807 $ 344 $13,145
(Depreciation) (16,866) (9,830) (1,891) (4,496) (1,707) (8,295)
--------- --------- --------- --------- --------- ---------
Net unrealized
appreciation
(depreciation)
on investments $ 32,658 $ 634 $(1,741) $(2,689) $(1,363) $ 4,850
========= ========= ========= ========= ========= =========
</TABLE>
At October 31, 1999, the cost of investments, in thousands, for federal
income tax purposes was $58,673, $201,618, $513,592, $376,264, $260,268,
$357,682, $144,463, $139,111, $59,764, $194,629, $317,451, $84,846 and $503,280
for the Balanced Income, Balanced Growth, Growth and Income, Equity Index,
Growth, Special Growth, Emerging Growth, MicroCap, International Equity, Short-
Term Bond Market, Intermediate Bond Market, Tax-Exempt Intermediate Bond and
Bond IMMDEX/TM Funds, respectively. The difference between cost amounts for
financial reporting and tax purposes is primarily due to timing differences in
recognizing certain gains and losses on security transactions, for the Balanced
Income Fund a tax-free conversion of a bank common trust fund and for the
International Equity Fund passive foreign investment company (PFIC) value
adjustments.
At October 31, 1999, the Short-Term Bond Market Fund had accumulated net
realized capital loss carryovers, in thousands, of $980, expiring in
2002. The Short-Term Bond Market and Bond IMMDEX/TM Funds had accumulated net
realized capital loss carryovers, in thousands, of $189 and $3, respectively,
expiring in 2003. The Short-Term Bond Market and Bond IMMDEX/TM Funds had
accumulated net realized capital loss carryovers, in thousands, of $79 and $24,
respectively, expiring in 2004. The Short-Term Bond Market Fund had accumulated
net realized capital loss carryovers, in thousands, of $1,083, expiring in 2005.
The Emerging Growth and International Equity Funds had accumulated net realized
capital loss carryovers, in thousands, of $5,736 and $4,919, respectively,
expiring in 2006. The Short-Term Bond Market, Intermediate Bond Market, Bond
IMMDEX/TM, Emerging Growth and International Equity Funds had accumulated net
realized capital loss carryovers, in thousands, of $604, $181, $88, $12,677 and
$3,881, respectively, expiring in 2007. To the extent each Fund realizes future
net capital gains, taxable distributions to its respective shareowners will be
offset by any unused capital loss carryover.
For the year ended October 31, 1999, the following percent of ordinary income
dividends (unaudited) qualifies for the dividend received deduction available to
corporate stockholders: Balanced Income Fund 27%, Balanced Growth Fund 14%,
Growth and Income Fund 100%, Equity Index Fund 58%, Growth Fund 45% and Emerging
Growth Fund 100%.
<PAGE>
(LOGO) FIRSTAR FUNDS
5. INVESTMENT ADVISORY AND OTHER AGREEMENTS
The Funds have entered into an Investment Advisory Agreement with Firstar
Investment Research & Management Company ("FIRMCO"). FIRMCO is a subsidiary of
Firstar Corporation, a publicly held bank holding company. Pursuant to its
Advisory Agreement with the Funds, the Adviser is entitled to receive a fee,
calculated daily and payable monthly, at the annual rates presented below as
applied to each Fund's daily net assets. Effective September 2, 1997
FIRMCOentered into a Sub-Advisory Agreement with Hansberger Global Investors
(the "Sub-Adviser") for the International Equity Fund. Prior to September 2,
1997, FIRMCOhad entered into a sub-advisory agreement with State Street Global
Advisors for the International Equity Fund. Pursuant to its Sub-Advisory
Agreement with FIRMCO, the Sub-Adviser is entitled to receive a fee from FIRMCO,
calculated daily and payable monthly, at the annual rate presented below as
applied to the International Equity Fund's daily net assets.
For the year ended October 31, 1999, FIRMCO voluntarily waived the following
fees, in thousands, by Fund:
<TABLE>
<CAPTION>
BALANCED BALANCED GROWTH EQUITY SPECIAL EMERGING
INCOME GROWTH AND INCOME INDEX GROWTH GROWTH GROWTH MICROCAP INTERNATIONAL
FUND FUND FUND FUND FUND FUND FUND FUND EQUITY FUND
-------- -------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Annual Rate 0.75% 0.75% 0.75% 0.25% 0.75% 0.75% 0.75% 1.50% <F2> <F3>
Fees waived $147 $156 $5 $394 $3 $31 $26 $1 $143
</TABLE>
<TABLE>
<CAPTION>
U.S. U.S.
SHORT- INTERMEDIATE TAX- INSTITUTIONAL TAX GOVERNMENT TREASURY
TERM BOND EXEMPT BOND MONEY MONEY -EXEMPT MONEY MONEY
MARKET MARKET INTERMEDIATE IMMDEX/TM MARKET MARKET MONEY MARKET MARKET MARKET
BOND FUND FUND BOND FUND FUND FUND FUND FUND FUND FUND
-------- -------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Annual Rate 0.60% 0.50% 0.50% 0.30% <F1> <F1> <F1> <F1> <F1>
Fees waived $543 $422 $165 $1 $336 $4,399 $14 $7 $15
</TABLE>
<F1> FIRMCO is entitled to receive a fee, calculated daily and payable monthly,
at the annual rate of 0.50% on the first $2 billion of each Fund's average
daily net assets, and 0.40% of each Fund's average daily net assets in
excess of $2 billion.
<F2> FIRMCO is entitled to receive a fee, calculated daily and payable monthly,
at the annual rate of 1.50% of the Fund's first $25 million of average
daily net assets, 1.25% on the next $75 million and 1.10% of the Fund's
average daily net assets in excess of $100 million.
<F3> Pursuant to its Sub-Advisory Agreement with FIRMCO, the Sub-Adviser is
entitled to receive a fee from FIRMCO, calculated daily and payable
monthly, at the annual rate of 0.75% of the Fund's first $25 million of
average daily net assets, 0.50% on the next $75 million and 0.35% of the
Fund's average daily net assets in excess of $100 million.
Chase Manhattan Bank serves as sub-custodian for the International Equity
Fund. Firstar Bank Milwaukee, N.A. serves as custodian and Firstar Mutual Fund
Services, LLC serves as transfer agent and accounting services agent for all the
Funds. Both companies are affiliates of FIRMCO.
The Company has entered into a Co-Administration Agreement with B.C. Ziegler
and Company and Firstar Mutual Fund Services, LLC (the
"Co-Administrators") for certain administrative services. Pursuant to the Co-
Administration Agreement with the Company, the Co-Administrators are entitled to
receive a fee, computed daily and payable monthly, at the annual rate of 0.125%
of the Company's first $2 billion of average aggregate daily net assets, plus
0.10% of the Company's average aggregate daily net assets in excess of $2
billion. For the year ended October 31, 1999, $35, $974, $16, $30, $12, $25,
$40, $12, $70, $6, $32, $88, $73, $31, $78, $9, $13 and $6 of administration
fees, in thousands, were waived for the Money Market, Institutional Money
Market, Tax-Exempt Money Market, U.S. Government Money Market, U.S. Treasury
Money Market, Short-Term Bond Market, Intermediate Bond Market, Tax-Exempt
Intermediate Bond, Bond IMMDEX/TM, Balanced Income, Balanced Growth, Growth and
Income, Equity Index, Growth, Special Growth, Emerging Growth, MicroCap and
International Equity Funds, respectively.
The Company has entered into Servicing Agreements with certain Service
Organizations, including FIRMCOaffiliates, for the non-money market Series A and
Series B classes of shares. The Service Organizations are entitled to receive
fees from the Funds up to the annual rate of 0.25% of the average daily net
asset value of the Series A and Series B Shares for certain support and/or
distribution services to customers of the Service Organizations who are
beneficial owners of Series A and Series B Shares. These services may include
assisting customers in processing purchase, exchange and redemption requests;
processing dividend and distribution payments from the Funds; and providing
information periodically to customers showing their positions in Series A and
Series B Shares. Service Organization fees, in thousands, incurred by the Short-
Term Bond Market, Intermediate Bond Market, Tax-Exempt Intermediate Bond, Bond
IMMDEX/TM, Balanced Income, Balanced Growth, Growth and Income, Equity Index,
Growth, Special Growth, Emerging Growth, MicroCap and International Equity Funds
aggregated $187, $84, $77, $252, $32, $151, $511, $337, $117, $303, $31, $44,
and $16, respectively, for the year ended October 31, 1999.
The Funds have adopted a Service and Distribution Plan pursuant to Rule 12b-
1 of the Investment Company Act of 1940 for the Series A, the Series B and the
money market funds' shareowners. The Funds paid no 12b-1 fees with respect to
the Series A Shares or the money market funds for the current fiscal year except
for the Money Market Fund, which incurred $105, in thousands, for the year ended
October 31, 1999. The Funds paid
<PAGE>
(LOGO) FIRSTAR FUNDS
0.75% in 12b-1 fees with respect to Series B Shares for the current fiscal year.
For the year ended October 31, 1999, the Short-Term Bond Market, Intermediate
Bond Market, Tax-Exempt Intermediate Bond, Bond IMMDEX/TM, Balanced Income,
Balanced Growth, Growth and Income, Equity Index, Growth, Special Growth,
Emerging Growth, MicroCap and International Equity Funds incurred expenses, in
thousands, of $2, $1, $0, $6, $3, $2, $5, $11, $2, $0, $0, $0 and $0,
respectively.
Each Director of the Company who is not affiliated with FIRMCO receives an
annual fee from the Company for service as a Director and is eligible to
participate in a deferred compensation plan with respect to these fees.
Participants in the plan may designate their deferred Director's fees as if
invested in any one of the Firstar Funds (with the exception of the MicroCap
Fund) or in 90-day U.S. Treasury bills. The value of each Director's deferred
compensation account will increase or decrease as if it were invested in shares
of the selected Firstar Funds or 90-day U.S. Treasury bills. The Funds maintain
their proportionate share of the Company's liability for deferred fees.
6. FOREIGN SECURITIES
Investing in securities of foreign companies and foreign governments
involves special risks and considerations not typically associated with
investing in U.S.companies and the U.S. Government. These risks include
revaluation of currencies and future adverse political and economic
developments. Moreover, securities of many foreign companies and foreign
governments and their markets may be less liquid and their prices more volatile
than those of securities of comparable U.S. companies and the U.S.Government.
7. SECURITIES LENDING
The Funds have entered into a securities lending agreement with the
custodian. Under the terms of the agreement, the Funds receive a negotiable
percentage of the annual net income from lending transactions. In exchange for
such fees, the custodian is authorized to loan securities on behalf of the
funds, against receipt of collateral at least equal in value to the value of the
securities loaned. The funds bear the risk of any deficiency in the amount of
collateral available for return due to a loss in an approved instrument. As of
October 31, 1999, the Funds had no securities on loan.
8. DISTRIBUTION TO SHAREHOLDERS
Net investment income and net realized gains, if any, are distributed to
shareholders. The funds intend to declare distributions of all net investment
income and net realized gains to be paid on December 29, 1999 to shareholders of
record on December 28, 1999.
The following Funds hereby designate the following amounts (unaudited) as
long-term capital gain distributions for purposes of the dividends paid
deduction:
<TABLE>
<CAPTION>
BALANCED BALANCED GROWTH EQUITY SPECIAL INTERMEDIATE TAX-EXEMPT
INCOME GROWTH AND INCOME INDEX GROWTH GROWTH MICROCAP BOND MARKET INTERMEDIATE
FUND FUND FUND FUND FUND FUND FUND FUND BOND FUND
--------- --------- --------- --------- --------- --------- --------- --------- ---------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
$1,817,504 $7,996,190 $45,168,361 $2,348,993 $25,626,227 $33,858,132 $277,054 $301,274 $80,572
</TABLE>
9. TRANSACTIONS WITH AFFILIATES
The following companies are affiliated with the Funds either directly, or by
the Fund holding 5% or more of the outstanding voting securities during the year
ended October 31, 1999. Such companies are defined in Section (2)(a)(3) of the
Investment Company Act of 1940.
<TABLE>
<CAPTION>
SHARE BALANCE AT SHARE BALANCE AT
COMPANY OCTOBER 31, 1998 PURCHASES SALES OCTOBER 31, 1999 DIVIDENDS GAIN/LOSSES
-------------- -------------- -------------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Firstar Corporation 0 65,137<F1> 5,400 59,737 $11,820 $(16,331)
(held in Equity Index Fund)
EduTrek International, Inc. 274,500 64,800 29,800 309,500 $0 $(207,851)
(held in Microcap Fund)
</TABLE>
<F1> On September 20, 1999, Mercantile Bank stock was merged into Firstar stock
resulting in an additional 19,237 shares held as Firstar stock.
10. SUBSEQUENT EVENT
The MicroCap Fund made a distribution of short-term capital gains of $6.13
per share paid on November 12, 1999 to shareholders of record on November 11,
1999.
<PAGE>
(LOGO) FIRSTAR FUNDS
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF THE FIRSTAR MONEY MARKET FUND, THE
FIRSTAR INSTITUTIONAL MONEY MARKET FUND, THE FIRSTAR TAX-EXEMPT MONEY MARKET
FUND, THE FIRSTAR U.S. GOVERNMENT MONEY MARKET FUND, THE FIRSTAR U.S. TREASURY
MONEY MARKET FUND, THE FIRSTAR SHORT-TERM BOND MARKET FUND, THE FIRSTAR
INTERMEDIATE BOND MARKET FUND, THE FIRSTAR TAX-EXEMPT INTERMEDIATE BOND FUND,
THE FIRSTAR BOND IMMDEX/TM FUND, THE FIRSTAR BALANCED INCOME FUND, THE FIRSTAR
BALANCED GROWTH FUND, THE FIRSTAR GROWTH AND INCOME FUND, THE FIRSTAR EQUITY
INDEX FUND, THE FIRSTAR GROWTH FUND, THE FIRSTAR SPECIAL GROWTH FUND, THE
FIRSTAR EMERGING GROWTH FUND, THE FIRSTAR MICROCAP FUND AND THE FIRSTAR
INTERNATIONAL EQUITY FUND
In our opinion, the accompanying statements of assets and liabilities, including
the schedules 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 the Firstar Money Market Fund, the
Firstar Institutional Money Market Fund, the Firstar Tax-Exempt Money Market
Fund, the Firstar U.S. Government Money Market Fund, the Firstar U.S. Treasury
Money Market Fund, the Firstar Short-Term Bond Market Fund, the Firstar
Intermediate Bond Market Fund, the Firstar Tax-Exempt Intermediate Bond Fund,
the Firstar Bond IMMDEX/TM Fund, the Firstar Balanced Income Fund, the Firstar
Balanced Growth Fund, the Firstar Growth and Income Fund, the Firstar Equity
Index Fund, the Firstar Growth Fund, the Firstar Special Growth Fund, the
Firstar Emerging Growth Fund, the Firstar MicroCap Fund and the Firstar
International Equity Fund (comprising Firstar Funds, Inc. (the "Funds")) at
October 31, 1999, the results of each of their operations for the year then
ended, the changes in each of their net assets for the periods indicated and
each of their financial highlights for the year ended October 31, 1999, and for
each of the other periods indicated, all in conformity with generally accepted
accounting principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of the
Funds' management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at October 31, 1999 by correspondence with the
custodian and brokers, provide a reasonable basis for the opinion expressed
above.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Milwaukee, Wisconsin
December 28, 1999
<PAGE>
This page intentionally left blank.
<PAGE>
FIRSTAR FUNDS ARE AVAILABLE THROUGH:
- - THE FIRSTAR FUNDS CENTER,
- - FINANCIAL CONSULTANTS WHO ARE EITHER REGISTERED
REPRESENTATIVES OF FIRSTAR INVESTMENT SERVICES, INC.
A REGISTERED BROKER/DEALER, NASD AND SIPC MEMBER,
OR REGISTERED REPRESENTATIVES OF MDS SECURITIES,
A DIVISION OF CONSECO FINANCIAL SERVICES, INC.,
A REGISTERED BROKER/DEALER, NASD AND SIPC MEMBER,
- - AND THROUGH SELECTED SHAREHOLDER ORGANIZATIONS.
This report is authorized for distribution only when preceded or
accompanied by a current prospectus.
FOR ACCOUNT BALANCE AND INVESTOR SERVICES INFORMATION
1-800-677-FUND
1-414-287-3808
FIRSTAR FUNDS CENTER
615 EAST MICHIGAN STREET
P.O. BOX 3011
MILWAUKEE, WI 53201-3011
WWW.FIRSTARFUNDS.COM
(LOGO) FIRSTAR FUNDS
FORM # FFANN99
