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MORGAN
KEEGAN
Morgan Keegan & Company, Inc.
Members New York Stock Exchange
THE BEDFORD FAMILY
MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
MUNICIPAL
MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
GOVERNMENT OBLIGATIONS
MONEY MARKET PORTFOLIO
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SEMI-ANNUAL REPORT
FEBRUARY 29, 1996
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<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
SEMI-ANNUAL INVESTMENT ADVISER'S REPORT
Investor sentiment reversed course during the last few months of 1995. In
the second half of the year, investors believed that the Federal Reserve had
successfully engineered a "soft landing" and expected President Clinton and
Congress to agree on a plan that would balance the federal budget by 2002. As
1996 began, however, fears of recession began to re-emerge and the budget
negotiations, which had become very intense in December and January, all but
disappeared as politics and state primaries took center stage.
The lack of economic data due to the recently ended federal government
shutdown has added to the difficulty of assessing the current economic
environment.It is clear, however, that the economy is not robust. While retail
sales over the past three months suggest that real consumer spending should be
growing at a 2.0-2.5% rate, the manufacturing economy continues to be weak, as
evidenced by the National Association of Purchasing Managers' reading below 50.
But even this indicator has stabilized, suggesting that inventory reduction
programs have run their course. Nonetheless, business confidence remains high
and firms continue to invest in producer durable goods such as computers and
machine tools. Available evidence further points to continued strength in
exports, which are benefitting from the earlier low level of the dollar and the
high quality of U.S.-produced goods. The federal government remains the weak
link in a modest growth forecast and the budget impasse only exacerbates the
effect on U.S. output as the government buys fewer goods and services.
The nation's weak economic conditions fostered a declining interest rate
environment for the six-month period ended February 29, 1996. During this
period, the Federal Reserve reduced the federal funds rate to 5.25% from 5.75%
and the discount rate to 5.00% from 5.25%. Volatile market conditions
dramatically altered the shape of the yield curve (3-months to 30-years) from a
spread of 117 points on September 1, 1995 to a steepening bias of 145 basis
points on February 29, 1996. As the treasury market rallied, lowering the yield
on the long bond to 6%, yield spreads on mortgages widened initially but by
February 29, spreads narrowed below their six-month averages. Overall, this
sector underperformed as prepayments and duration concerns increased selling
pressure. The corporate sector realized excellent returns as heavy investor
demand absorbed all new issuance plus strengthening credit quality forced yield
spreads to tighten considerably.
Taking all the sources of final demand together, modest economic growth is
still the most likely forecast -- 2.5% real GDP growth in 1996, with the first
half of the year being relatively weak and the second half of the year
strengthening. Even this modest growth is going to require some help from the
Fed. The Fed's two federal funds rate cuts of 25 basis points each in 1995 were
not enough. With the dramatic fall in long-term interest rates, the flattening
of the yield curve through 1995 is a threat to the economy and raises the
specter of recession. Some steepening is necessary, which would indicate the
addition of liquidity to the system. We expect that steepening to come from a
combination of lower short-term interest rates and slightly higher long-term
rates.
Tax-exempt money market funds experienced record growth during the six
months ended February 29, 1996. Assets hit new all-time highs in each month and
ended the period at $134.7 billion, up $19.6 billion or 17% from last year. This
surge in assets can be attributed to uncertainty over changes to the tax code
and flat tax proposals, the Washington budget impasse, new T+3 settlement rule
changes and an inverted yield curve.
Investor concerns about credit quality created enormous demand for high
quality paper during the period. The pressure on the Japanese banking system, as
well as the ratings downgrades on several Japanese banks, widened the spreads
between Japanese letters of credit and European or domestic letters of credit to
over 30 basis points.
Tax-free money fund yields trended upwards in the fourth quarter as supply
increased. Yields hit a six-month peak at year-end due to seasonal window
dressing pressures. Weaker than expected economic reports and a lack of supply
caused yields to decline early in the new year.
PNC Institutional Management Corporation
(Please dial toll-free 800-533-7719 for questions
regarding your account or contact your broker.)
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
------- ------------
AGENCY OBLIGATIONS--2.5%
Student Loan Marketing Association
5.180% 03/05/96 ............................. $20,000 $ 20,000,000
5.190% 03/05/96 ............................. 10,000 10,000,000
5.200% 03/05/96 ............................. 25,000 24,991,857
------------
TOTAL AGENCY OBLIGATIONS
(Cost $54,991,857) ...................... 54,991,857
------------
CERTIFICATES OF DEPOSIT--8.0%
DOMESTIC CERTIFICATES OF DEPOSIT--1.4%
Society Nat Bank-Cleveland
6.400% 04/25/96 ............................. 10,000 10,012,889
Chase Manhattan Bank
USA N.A. [A-1]
5.400% 06/13/96 ............................. 20,000 20,000,000
------------
30,012,889
------------
YANKEE DOLLAR CERTIFICATES OF DEPOSIT--6.6%
Deutsche Bank
5.420% 04/05/96 ............................. 25,000 24,999,902
Societe Generale
5.450% 04/04/96 ............................. 70,000 70,000,000
5.720% 03/01/96 ............................. 25,000 25,000,000
Westpac Banking Corp.
5.850% 06/04/96 ............................. 25,000 25,000,000
------------
144,999,902
------------
TOTAL CERTIFICATES OF DEPOSIT
(Cost $175,012,791) ..................... 175,012,791
------------
BANK NOTES--2.3%
First National Bank of Boston
5.400% 05/07/96 ............................. 25,000 25,000,000
LaSalle National Bank
5.160% 05/06/96 ............................. 25,000 25,000,000
------------
TOTAL BANK NOTES
(Cost $50,000,000) ...................... 50,000,000
------------
COMMERCIAL PAPER--50.4%
BANKS--8.5%
Lehman Brothers Holdings Inc.
5.710% 03/07/96 ............................. 25,000 24,976,208
National City Corp.
5.450% 04/01/96 ............................. 30,000 29,859,208
PAR
(000) VALUE
------- ------------
BANKS--(CONTINUED)
National & Provincial Building Society
5.670% 03/04/96 ........................... $35,000 $ 34,983,463
NationsBank Corp.
5.370% 04/12/96 ........................... 40,000 39,749,400
Svenska Handelsbanken Inc.
5.130% 05/06/96 ........................... 40,000 39,623,800
Chemical Banking Corp.
5.610% 03/15/96 ........................... 15,000 14,967,275
------------
184,159,354
------------
FINANCE LESSORS--2.3%
General Electric Capital Corp.
5.600% 03/28/96 ........................... 50,000 49,790,000
------------
FINANCE SERVICES--5.9%
Countrywide Funding Corp.
5.150% 05/09/96 ........................... 50,000 49,506,458
Whirlpool Financial Corp.
5.120% 05/10/96 ........................... 30,000 29,701,334
5.100% 05/14/96 ........................... 50,000 49,475,833
------------
128,683,625
------------
GLASS, GLASSWARE, PRESSED OR BLOWN--1.1%
Newell Co.
5.250% 03/18/96 ........................... 25,000 24,938,021
------------
HOUSEHOLD APPLIANCES--1.0%
Whirlpool Corp.
5.100% 05/14/96 ........................... 22,000 21,769,367
------------
NATURAL GAS TRANSMISSION--1.2%
Southern California Gas
5.560% 05/03/96 ........................... 26,155 25,900,512
------------
PERSONAL CREDIT INSTITUTIONS--6.0%
BMW US Capital Corp.
5.670% 03/01/96 ........................... 25,000 25,000,000
5.270% 03/21/96 ........................... 50,000 49,853,611
General Motors Acceptance Corp.
5.620% 03/25/96 ........................... 15,000 14,943,800
Associates Corp. of North America
5.150% 06/17/96 ........................... 42,000 41,351,100
------------
131,148,511
------------
See Accompanying Notes to Financial Statements.
2
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
------- ------------
PHARMACEUTICAL PREPARATIONS--2.6%
American Home Products Corp.
5.110% 05/10/96 ........................... $25,000 $ 24,751,597
Glaxo Wellcome PLC
5.140% 05/10/96 ........................... 32,000 31,680,178
-------------
56,431,775
-------------
PLASTIC MAIL, SYNTHETIC RESIN/
RUBBER CELLULOSE - NO GLASS--1.1%
Du Pont (E.I.) de Nemours & Co.
5.580% 07/18/96 ........................... 25,000 24,461,375
-------------
SECURITY BROKERS & DEALERS--5.7%
Bear Stearns & Co., Inc.
5.550% 07/22/96 ........................... 10,000 9,779,542
Goldman Sachs Group L.P.
5.600% 04/09/96 ........................... 40,000 39,757,333
Morgan Stanley Group, Inc.
5.380% 04/08/96 ........................... 75,000 74,574,083
--------------
124,110,958
-------------
SHORT-TERM BUSINESS CREDIT INSTITUTIONS--13.8%
American Express Credit Corp.
5.390% 04/30/96 ........................... 50,000 49,550,833
CXC, Inc.
5.600% 03/05/96 ........................... 25,000 24,984,444
5.130% 06/07/96 ........................... 25,000 24,650,875
Corporate Asset Funding, Inc.
5.330% 04/29/96 ........................... 40,000 39,650,589
Corporate Receivables Corp.
5.320% 04/12/96 ........................... 50,000 49,689,666
5.150% 05/08/96 ........................... 48,000 47,533,067
Sears Roebuck Acceptance Corp.
5.620% 03/04/96 ........................... 25,000 24,988,292
5.620% 03/08/96 ........................... 40,000 39,956,289
-------------
301,004,055
-------------
TELEPHONE COMMUNICATIONS--1.2%
GTE Corp.
5.300% 03/12/96 ........................... 25,000 24,959,514
-------------
TOTAL COMMERCIAL PAPER
(Cost $1,097,357,067) ................. 1,097,357,067
-------------
PAR
(000) VALUE
------------ ------------
MUNICIPAL BONDS--5.4%
CALIFORNIA--1.0%
Adventist Health Systems West Series
1988 (First Interstate Bank of
California LOC)(DAGGER)
5.450% 03/06/96 ............................. $12,925 $12,925,000
San Bernardino County California
Certificate of Participation County
Center Refinancing Project,
Series 1995(DAGGER)
5.350% 03/07/96 ............................. 7,900 7,900,000
-----------
20,825,000
-----------
GEORGIA--0.1%
Richmond County Georgia IDA
(Monsanto Co. Project) VRDN(DAGGER)
6.270% 06/01/96 ............................. 1,300 1,300,000
-----------
ILLINOIS--0.8%
Barton Healthcare Taxable Revenue
Bonds Series 1995 VRDN (American
Nation Bank LOC)(DAGGER)
5.450% 03/06/96 ............................. 12,875 12,875,000
Baylis Group Partnership Weekly
Demand Taxable Bond Series 1992
VRDN (Societe Generale LOC)(DAGGER)
5.600% 03/06/96 ............................. 600 600,000
Illinois Health Facilities Authority
Convertible/ VRDN
(The Streeterville Corp. Project)
Series 1993-B (First National
Bank of Chicago LOC)(DAGGER)
5.400% 03/06/96 ............................. 4,400 4,400,000
-----------
17,875,000
-----------
KENTUCKY--0.2%
Boone County Taxable IDR Refunding
Bonds (Square D Company Project)
Series 1994-B (Credit Lyonnais LOC)
VRDN(DAGGER)
5.400% 03/06/96 ............................. 4,200 4,200,000
-----------
See Accompanying Notes to Financial Statements.
3
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
--------- ------------
MINNESOTA--0.2%
Fairview Hospital And Healthcare
Services Taxable ADJ Convertible
Extendable Securities Series 1994
(MBIA Insured) VRDN(DAGGER)
5.350% 03/07/96 ............................... $ 5,100 $ 5,100,000
-----------
MISSISSIPPI--1.0%
Hinds County, Mississippi
IDRB VRDN(DAGGER)
5.450% 03/06/96 ............................... 3,690 3,690,000
Mississippi Business Finance Corp.
Taxable IDR Bonds (Bryan Foods, Inc.
Project) Series 1994 (Sara Lee
Corporation Guaranty) VRDN(DAGGER)
5.350% 03/06/96 ............................... 14,000 14,000,000
Mississippi Business Finance Corp.
Taxable IDRB VRDN(DAGGER)
5.450% 03/07/96 ............................... 3,500 3,500,000
-----------
21,190,000
-----------
NEW YORK--0.8%
Health Insurance Plan of Greater NY
ADJ/Convertible Extendable Securities
Series 1990 B-1 (Morgan Guaranty
Trust Co. LOC) VRDN(DAGGER)
5.400% 03/06/96 ............................... 5,500 5,500,000
Health Insurance Plan of Greater NY
ADJ/Convertible Extendable Securities
VRDN(DAGGER)
5.400% 03/06/96 ............................... 6,800 6,800,000
New York City
5.340% 08/21/96 ............................... 5,000 5,000,000
-----------
17,300,000
-----------
NORTH CAROLINA--0.6%
Community Health Systems, Inc. Taxable
First National Bank of North Carolina
Series 1991-A(DAGGER)
5.650% 03/06/96 ............................... 400 400,000
City of Ashville North Carolina
Tax Corp.(DAGGER)
5.350% 03/06/96 ............................... 13,500 13,500,000
-----------
13,900,000
-----------
PAR
(000) VALUE
-------- ------------
TEXAS--0.7%
South Central Texas Industrial
Development Corp. Taxable IDR Bonds
(Rohr Industries Project) Series 1990
(Citibank N.A. LOC) VRDN(DAGGER)
5.450% 03/06/96 ........................... $14,800 $ 14,800,000
------------
TOTAL MUNICIPAL BONDS
(Cost $116,490,000) ................... 116,490,000
------------
REVENUE ANTICIPATION NOTES--0.5%
MANDATORY PUT BONDS--0.5%
De Kalb County Georgia Development
Authority (Emory U.)(DAGGER)
5.400% 03/06/96 ........................... 10,100 10,100,000
------------
TOTAL REVENUE ANTICIPATION NOTES
(Cost $10,100,000) .................... 10,100,000
------------
CORPORATE OBLIGATIONS--22.1%
BANKS--6.7%
Citicorp
9.390% 05/29/96 ........................... 5,000 5,040,993
First Union National Bank of North
Carolina(DAGGER)
5.310% 03/01/96 ........................... 40,000 40,000,000
Morgan Guaranty Trust(DAGGER)
6.200% 03/01/96 ........................... 50,000 49,988,381
Norwest Corp.(DAGGER)
5.310% 03/28/96 ........................... 50,000 50,000,000
------------
145,029,374
------------
FINANCE LESSORS--2.3%
IBM Credit Corp.
5.880% 08/08/96 ........................... 25,000 24,999,017
6.000% 08/28/96 ........................... 25,000 24,999,016
------------
49,998,033
------------
MAJOR REGIONAL BANK--0.2%
Society Corp.
4.755% 03/11/96 ........................... 3,300 3,298,487
------------
See Accompanying Notes to Financial Statements.
4
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
-------- ------------
PERSONAL CREDIT INSTITUTIONS--1.1%
General Motors Acceptance Corp.
6.460% 03/01/96(DAGGER) ..................... $ 5,000 $ 4,998,402
8.250% 08/01/96 ............................. 5,000 5,047,535
7.900% 03/12/97 ............................. 14,750 15,142,055
------------
25,187,992
------------
SECURITY BROKERS & DEALERS--10.8%
Bear Stearns & Co., Inc.(DAGGER)
5.610% 03/01/96 ............................. 20,000 20,000,000
5.640% 03/01/96 ............................. 50,000 50,000,000
Goldman Sachs Group, LP(DAGGER)
5.440% 05/06/96 ............................. 53,000 53,000,000
Lehman Brothers Holdings Inc.(DAGGER)
5.910% 03/06/96 ............................. 50,000 50,000,000
Merrill Lynch & Co.
6.440% 05/15/96 ............................. 15,000 15,000,000
4.750% 06/24/96 ............................. 9,135 9,102,270
6.050% 08/19/96 ............................. 15,000 15,000,000
5.120% 02/27/97 ............................. 25,000 24,995,041
------------
237,097,311
------------
SERVICES-EQUIPMENT RENTING & LEASING--1.0%
International Lease and Finance Corp.
6.630% 06/01/96 ............................. 15,000 15,036,250
4.750% 07/15/96 ............................. 6,000 5,984,509
------------
21,020,759
------------
TOTAL CORPORATE OBLIGATIONS
(Cost $481,631,956) ..................... 481,631,956
------------
TIME DEPOSITS--2.8%
Bank of Hawaii
5.690% 03/01/96 ............................. 50,000 50,000,000
First Union National Bank
5.750% 03/01/96 ............................. 11,300 11,300,000
------------
TOTAL TIME DEPOSITS
(Cost $61,300,000) ...................... 61,300,000
------------
PAR
(000) VALUE
-------- ------------
REPURCHASE AGREEMENTS--6.4%
Goldman Sachs & Co. (Agreement
dated 02/29/96 to be repurchased at
$100,015,139, collateralized by
$54,773,415 Federal National
Mortgage Assoc.6.361% due
11/01/32 and $54,484,920
Federal Mortgage Assoc. Collateral
8.375% due 10/01/24. Market value
of collateral is $102,433,103)
5.450% 03/01/96 ........................... $100,000 $100,000,000
Morgan Stanley & Co. (Agreement
dated 02/29/96 to be repurchased
at $40,006,055, collateralized by
$48,127,005 Federal National
Mortgage Assoc. Sinking Fund Notes
5.50% to 9.00% due 02/01/01 to
01/01/15. Market value of
collateral is $40,749,363)
5.450% 03/01/96 ........................... 40,000 40,000,000
------------
TOTAL REPURCHASE AGREEMENTS
(Cost $140,000,000) ................... 140,000,000
------------
See Accompanying Notes to Financial Statements.
5
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS (CONCLUDED)
FEBRUARY 29, 1996
(UNAUDITED)
VALUE
--------------
TOTAL INVESTMENTS AT VALUE--100.4%
(Cost $2,186,883,671*) ..................... $2,186,883,671
LIABILITIES IN EXCESS
OF OTHER ASSETS--(0.4%) .................... (8,847,207)
--------------
NET ASSETS (Applicable to
1,112,410,124 Bedford shares,
232,617 Cash Preservation shares,
528,881,063 Janney Montgomery
Scott shares, 57,931 RBB shares,
536,478,247 Sansom Street shares
and 800 other shares)--100.0% ............. $2,178,036,464
==============
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
($2,178,036,464(DIVIDE)2,178,060,782) ........ $1.00
=====
* Also cost for Federal income tax purposes.
(DAGGER)Variable Rate Obligations -- The interest rate shown is the rate as of
February 29, 1996 and the maturity date shown is the longer of the
next interest rate readjustment date or the date the principal amount
shown can be recovered through demand.
INVESTMENT ABBREVIATIONS
VRDN ................................................. Variable Rate Demand Note
LOC ........................................................... Letter of Credit
IDR ............................................. Industrial Development Revenue
See Accompanying Notes to Financial Statements.
6
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED
FEBRUARY 29, 1996 (UNAUDITED)
INVESTMENT INCOME
Interest .............................................. $ 56,387,329
------------
EXPENSES
Investment advisory fees .............................. 3,571,794
Distribution fees ..................................... 4,341,873
Service organization fees ............................. 207,199
Directors' fees ....................................... 12,755
Custodian fees ........................................ 157,654
Transfer agent fees ................................... 1,376,180
Legal fees ............................................ 34,361
Audit fees ............................................ 33,544
Registration fees ..................................... 195,499
Insurance expense ..................................... 24,026
Printing expense ...................................... 213,857
Miscellaneous ......................................... 957
------------
10,169,699
Less fees waived ...................................... (1,766,060)
Less expense reimbursement by advisor ................. (7,804)
------------
TOTAL EXPENSES ..................................... 8,395,835
------------
NET INVESTMENT INCOME .................................... 47,991,494
------------
REALIZED LOSS ON INVESTMENTS ............................. (3,792)
------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ....................................... $ 47,987,702
============
STATEMENT OF CHANGES IN NET ASSETS
FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED
FEBRUARY 29, 1996 AUGUST 31, 1995
----------------- ----------------
(UNAUDITED)
Increase (decrease) in net assets:
Operations:
Net investment income ............... $ 47,991,494 $ 64,913,329
Net loss on investments ............. (3,792) (18,463)
--------------- ---------------
Net increase in net assets
resulting from operations ......... 47,987,702 64,894,866
--------------- ---------------
Distributions to shareholders:
Dividends to shareholders from
net investment income:
Bedford shares ($.0242 and
$.0486, respectively,
per share) ........................ (24,450,386) (38,765,552)
Cash Preservation shares
($.0243 and $.0487,
respectively, per share) .......... (5,156) (11,336)
Janney Montgomery Scott
shares ($.0240 and $.0112,
respectively, per share) .......... (11,766,024) (4,784,092)
RBB shares ($.0240 and
$.0482, respectively,
per share) ........................ (1,329) (2,530)
Sansom Street shares ($.0266
and $.0543, respectively,
per share) ........................ (11,768,599) (21,349,819)
--------------- ---------------
Total distributions to
shareholders .................... (47,991,494) (64,913,329)
--------------- ---------------
Net capital share
transactions ........................ 356,668,568 736,630,198
--------------- ---------------
Total increase in net assets ........... 356,664,776 736,611,735
Net Assets:
Beginning of period ................. 1,821,371,688 1,084,759,953
--------------- ---------------
End of period ....................... $ 2,178,036,464 $ 1,821,371,688
=============== ===============
See Accompanying Notes to Financial Statements.
7
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MUNICIPAL MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
-------- ------------
ALABAMA--1.3%
Alabama Special Care Facilities
Authority St. Vincent's Daughters
of Charity MB(DOUBLE DAGGER)
4.000% 11/01/96 ............................. $ 1,735 $ 1,739,127
Demopolis DN / (Banque Nationale de
Paris LOC) [A-1+]
3.550% 03/07/96 ............................. 3,000 3,000,000
Livingston IDR Toin Corp USA Project
DN / (Ind. Bank of Japan LOC) [A-1+]
3.900% 03/07/96 ............................. 1,000 1,000,000
-----------
5,739,127
-----------
ALASKA--0.5%
Alaska Industrial Development
and Export Authority VR RB Series 1984-5
(LOC Bank of America) DN(DAGGER)[A-1]
3.550% 03/07/96 ............................. 2,100 2,100,000
-----------
ARIZONA--2.8%
Flagstaff IDA DN / (FGIC Insurance)(DAGGER) [A-1]
3.300% 03/07/96 ............................. 7,755 7,755,000
Phoenix Civic Improvement Corp Excise
Tax Revenues DN Series 1995 /
(Hessen LOC) [A-1+]
3.400% 03/07/96 ............................. 5,000 5,000,000
-----------
12,755,000
-----------
ARKANSAS--0.3%
Arkansas State Development Authority
Health Care Facility Sisters of Mercy
Series AMB / (ABM-Amro Bank N.V
LOC)(DOUBLE DAGGER)[A-1+]
3.250% 03/07/96 ............................. 1,200 1,200,000
-----------
CALIFORNIA--10.0%
Los Angeles County California TRAN /
(Bank of America LOC) [SP-1]
4.500% 07/01/96 ............................. 6,500 6,513,741
Los Angeles County Metropolitan
Transportation Authority General
RB DN(DAGGER) [A-1+]
2.900% 03/07/96 ............................. 600 600,000
PAR
(000) VALUE
-------- ------------
CALIFORNIA--(CONTINUED)
Oakland DN(DAGGER)
3.400% 03/07/96 ............................. $ 6,600 $ 6,600,000
Southeast Resource Recovery Facility
Authority Lease RB DN(DAGGER) [A-1]
3.300% 03/07/96 ............................. 24,300 24,300,000
Washington Township Hospital District
Alemeda County DN / (Ind. Bank of
Japan LOC)(DAGGER)
3.450% 03/07/96 ............................. 7,400 7,400,000
-----------
45,413,741
-----------
COLORADO--0.6%
Colorado Health Facilities Authority
Hospital RB MB (Bounder Community
Hospital Projects) Series 1989 C /
(RABO Bank Nederland LOC)(DOUBLE DAGGER)[A-1+]
3.250% 03/07/96 ............................. 400 400,000
Moffat County DN(DAGGER)[A-1+]
3.300% 03/07/96 ............................. 2,400 2,400,000
-----------
2,800,000
-----------
DELAWARE--0.7%
The Delaware Economic Development
Authority Gas Facilities Refunding
(Delmarva Power & Light Project)
Series 1993-C RB DN(DAGGER) [MIG]
3.500% 03/07/96 ............................. 3,000 3,000,000
-----------
FLORIDA--0.9%
Dade County HFA Miami Children's
Hospital Project DN /
(AMBAC Insurance)(DAGGER)
3.050% 03/07/96 ............................. 1,200 1,200,000
Florida Housing Finance Agency DN /
(Wells Fargo Bank LOC)(DAGGER)[A-1]
3.550% 03/30/96 ............................. 3,000 3,000,000
-----------
4,200,000
-----------
GEORGIA--5.4%
Burke County PCRB Georgia Power
Company Vogtle Project 2ND
Series DN(DAGGER)[A-1]
3.400% 03/01/96 ............................. 3,100 3,100,000
See Accompanying Notes to Financial Statements.
8
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MUNICIPAL MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
------- ------------
GEORGIA--(CONTINUED)
Carrollton Payroll Development
Authority RAN Certificates
3.450% 03/07/96 ............................. $ 6,000 $ 6,000,000
Forsyth County IDRB for American
BOA, Inc. Project DN(DAGGER)
3.350% 03/07/96 ............................. 2,000 2,000,000
Monroe County Development Authority
PCR RB DN (Georgia Power Co.
Plant Scherer Project)
First Series 1995(DAGGER)[A-1]
3.400% 03/01/96 ............................. 13,300 13,300,000
-----------
24,400,000
-----------
ILLINOIS--7.1%
Chicago O'Hare International Airport
Special Facility RB DN /
(Society General LOC)(DAGGER) [A-1+]
3.350% 03/07/96 ............................. 5,800 5,800,000
Illinois Development Finance Authority
CHS Acquisition Corp Project DN /
(ABM-AMRO Bank N.V. LOC)(DAGGER) [A-1+]
3.550% 03/07/96 ............................. 5,035 5,035,000
Illinois Development Facility Harris
DN / (FNMA LOC)(DAGGER)[A-1+]
3.350% 03/07/96 ............................. 7,000 7,000,000
Illinois Educational Facilities Authority
RB DN / (Sanwa Bank LOC)(DAGGER) [A-1+]
3.250% 03/07/96 ............................. 2,700 2,700,000
Illinois Educational Facilities Authority
RB DN(DAGGER) [A-1]
3.600% 03/07/96 ............................. 8,000 8,000,000
Health Facility Authority DN (Central
Health Care And Northwest
Community Hospital) / (Sumitomo
Bank LOC)(DAGGER) [MIG]
3.400% 03/07/96 ............................. 1,545 1,545,000
Illinois Housing Development
Authority Series C-2 /(Societe
Generale LOC) MB(DOUBLE DAGGER) [MIG]
3.450% 09/03/96 ............................. 2,200 2,200,000
-----------
32,280,000
-----------
PAR
(000) VALUE
------- ----------
INDIANA--6.9%
Evansville Hospital Authority Hospital
Revenue Daughters of Charity
St. Mary's Medical Center of
Evansville DN(DAGGER) [A-1+]
3.200% 03/07/96 ................................. $ 5,400 $ 5,400,000
Indiana Health Facility Authority
Daughters of Charity for
St. Mary's Med DN(DAGGER)
4.000% 11/01/96 ................................. 840 841,998
Indiana Development Finance Authority
Solid Waste Disposal RB Pure Air
On The Lake, L. P. Project /
(Fuji Bank LOC)(DOUBLE DAGGER) [MIG]
3.950% 03/01/96 ................................. 10,000 10,000,000
Indiana Development Finance
Authority DN(DAGGER) / (Societe Generale LOC)
3.650% 03/07/96 ................................. 5,000 5,000,000
Indiana Housing Finance Authority
Series 1994 C MB(DOUBLE DAGGER)
4.000% 07/01/96 ................................. 1,500 1,500,000
Orleans Economic Development RB
for Almana Ltd. Liability Co. Project
Series 95 DN(DAGGER)
3.500% 03/07/96 ................................. 5,400 5,400,000
Tippecanoe DN /
(Bank of New York LOC)(DAGGER)
3.400% 03/07/96 ................................. 3,000 3,000,000
-----------
31,141,998
-----------
IOWA--0.9%
Iowa Finance Authority Tax-Exempt
Adjustable Mode IDA RB DN
(Dixie Bedding Co Project)
Series 95 / (Wachovia LOC)(DAGGER)
3.450% 03/07/96 ................................. 3,000 3,000,000
Osceola IDA RB (Babson Brothers
Co. Projects) Series 1986
DN / (Bank Of New York LOC)(DAGGER) [MIG]
3.450% 03/07/96 ................................. 1,100 1,100,000
-----------
4,100,000
-----------
See Accompanying Notes to Financial Statements.
9
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MUNICIPAL MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
------- ------------
KANSAS--1.7%
Lawrence IDRB Series A RAN Co
Project DN / (Wachovia LOC)(DAGGER)
3.450% 03/07/96 ............................. $ 2,125 $ 2,125,000
Shawnee IDRB Thrall Enterprises Inc
Project DN [A-1+]
3.550% 03/07/96 ............................. 5,700 5,700,000
-----------
7,825,000
-----------
KENTUCKY--6.6%
Hopkinsville RB (American Precision
Machinery) Series 1990 DN /
(Mitsubishi Bank LOC)(DAGGER) [MIG]
3.400% 03/07/96 ............................. 3,600 3,600,000
Hopkinsville IDA RB Douglas Autotech
Corp Project Series 95 DN /
(IND. Bank Of Japan LOC)(DAGGER) [A-1+]
3.900% 03/07/96 ............................. 7,700 7,700,000
Louisville Airport DN / (National City
Bank of Cleveland LOC)(DAGGER) [A-1]
3.450% 03/07/96 ............................. 6,000 6,000,000
Maysville, City of Solid Waste Disposal
Facilities RB MB(DOUBLE DAGGER) [A-1]
3.650% 03/27/96 ............................. 12,365 12,365,000
-----------
29,665,000
-----------
LOUISIANA--5.4%
East Baton Rouge Mortgage Finance
Authority MB Single Family Mortgage
Purchase Bonds / (FNMA LOC)(DAGGER) [MIG]
3.400% 10/03/96 ............................. 2,910 2,910,000
East Baton Rouge Parish Pacific Corp
Project DN / (Ind. Bank of
Japan LOC)(DAGGER)
3.650% 03/07/96 ............................. 6,500 6,500,000
Lincoln, Parish of RB DN(DAGGER) [A-1]
3.550% 03/07/96 ............................. 15,000 15,000,000
-----------
24,410,000
-----------
MARYLAND--1.3%
Howard County Bluffs at Clary's Forest
Apartment Facility Series 1995 DN /
(FNB Maryland LOC)(DAGGER) [A-1]
3.450% 03/07/96 ............................. 5,800 5,800,000
-----------
PAR
(000) VALUE
-------- -----------
MASSACHUSETTS--3.8%
Massachusetts Bay Transportation
Authority TECP Series C MB
(Westdeutsche Landesbank
Girozentrale LOC)(DOUBLE DAGGER) [A-1+]
3.300% 03/27/96 ................................. $12,500 $12,500,000
Massachusetts Industry Finance
Agency MB(DOUBLE DAGGER)
3.600% 03/15/96 ................................. 4,800 4,800,000
-----------
17,300,000
-----------
MICHIGAN--1.6%
Detroit Downtown Development
Authority DN (Millender Project) /
(Sumitomo Bank LOC)(DAGGER)
3.350% 03/07/96 ................................. 2,400 2,400,000
Michigan State Hospital Finance
Authority Daughters of Charity MB(DOUBLE DAGGER)
4.000% 11/01/96 ................................. 875 877,081
Michigan State Strategic Fund Limited
Obligation RB DN / (Comerica Bank
Detroit LOC)(DAGGER) [A-1]
3.450% 03/07/96 ................................. 2,800 2,800,000
Northville IDA DN (Thrifty Northville
Project) / (Westpac Banking
Corp LOC)(DAGGER) [P-1]
3.350% 03/07/96 ................................. 1,000 1,000,000
-----------
7,077,081
-----------
MISSOURI--3.7%
Forsyth PCR (Portland General Electric)
(Mitsubishi) (VMIG-1,NR) DN /
(Banque Nationale de Paris LOC)(DAGGER)
3.500% 03/01/96 ................................. 3,000 3,000,000
City of Kansas IDA RB (Mid-America
Health Services Inc. Project)
Series 1984 DN / (Bank of
New York LOC)(DAGGER) (A-1) [A-1]
3.550% 03/07/96 ................................. 1,100 1,100,000
Missouri Higher Education DN /
(National Westminster LOC)(DAGGER) [A-1+]
3.400% 03/07/96 ................................. 800 800,000
Missouri State Health & Education
Facilities Authority St. Anthony's
Medical Center Series A DN /
(Mitsubishi Bank LOC)(DAGGER) [A-1+]
3.650% 03/07/96 ................................. 6,000 6,000,000
See Accompanying Notes to Financial Statements.
10
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MUNICIPAL MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
-------- ------------
MISSOURI--(CONTINUED)
Missouri State Health & Education
Facilities Authority St. Anthony's
Medical Center Series C DN /
(Mitsubishi Bank LOC)(DAGGER) [A-1+]
3.650% 03/07/96 ............................. $ 6,000 $ 6,000,000
-----------
16,900,000
-----------
NEBRASKA--0.8%
Lancaster Sun-Husker Foods Inc.
Project DN / (Bank of Tokyo
LOC)(DAGGER) [A-1+]
3.900% 03/07/96 ............................. 3,800 3,800,000
-----------
NEW HAMPSHIRE--5.3%
New Hampshire Housing Finance
Authority Series 1994 1 DN(DAGGER) [MIG]
3.400% 03/07/96 ............................. 5,000 5,000,000
New Hampshire State Development
Authority Solid Waste Disposal
Facility RB United Illuminating Co.
Project A MB / (Barclays Bank
LOC)(DOUBLE DAGGER) [MIG]
3.850% 03/01/96 ............................. 4,350 4,350,000
New Hampshire State Housing Finance
Authority Multifamily RB Countryside
L.P. Project DN / (General Electric
Capital Corp. LOC)(DAGGER) [MIG]
3.400% 03/07/96 ............................. 14,700 14,700,000
-----------
24,050,000
-----------
NEW YORK--5.1%
New York City RAN Series 1996-A
4.500% 04/11/96 ............................. 2,770 2,771,704
New York City RAN Series B / (Multiple
Credit Enhancements) [SP-1]
4.750% 06/28/96 ............................. 18,500 18,575,819
Triborough Bridge and Tunnel Authority
DN / (FGIC Insurance)(DAGGER) [A-1+]
3.250% 03/07/96 ............................. 1,700 1,700,000
-----------
23,047,523
-----------
PAR
(000) VALUE
------- ----------
NORTH CAROLINA--0.1%
North Carolina Medical Care
Commission Hospital RB DN
(Moses H. Cone Memorial Hospital
Project)(DAGGER) [A-1+]
3.250% 03/07/96 ................................. $ 600 $ 600,000
-----------
OHIO--0.8%
Clermont County RB (Mercy Health
Systems) Series 1994B DN(DAGGER) [A-1]
3.350% 03/07/96 ................................. 1,000 1,000,000
Toledo Improvement Notes Series 2 MB(DOUBLE DAGGER)
3.890% 05/15/96 ................................. 2,610 2,610,206
-----------
3,610,206
-----------
PENNSYLVANIA--0.2%
Sayre County Health Care Facilities
Authority D (Capital Financing
Program) Series K DN(DAGGER)
3.100% 03/07/96 ................................. 900 900,000
-----------
RHODE ISLAND--2.5%
Rhode Island Housing & Mortgage
Finance Corp Convertible Home
Ownership Opportunity Bonds
Series 19D MB / (Societe Generale
LOC)(DOUBLE DAGGER) [A-1+]
3.550% 01/30/97 ................................. 2,000 2,000,000
Rhode Island Student Loan Series 1
DN / (National Westminster
LOC)(DAGGER) [A-1+]
3.300% 03/06/96 ................................. 9,500 9,500,000
-----------
11,500,000
-----------
SOUTH CAROLINA--0.8%
York County PCR RB Duke Power Co.
Project MB(DOUBLE DAGGER) [A-1+]
3.350% 04/12/96 ................................. 3,500 3,500,000
-----------
See Accompanying Notes to Financial Statements.
11
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MUNICIPAL MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
------- ----------
TENNESSEE--1.9%
Montgomery County Public Building
Authority County Loan Pool
GO DN / (NCNB LOC)(DAGGER) [A-1]
3.400% 03/07/96 ................................. $ 2,400 $ 2,400,000
Oak Ridge Municipal Solid Waste
Disposal Facility Bonds Series 1996
M4 Environmental L.P. Project DN /
(Sunbank LOC)(DAGGER)
3.450% 03/07/96 ................................. 6,000 6,000,000
-----------
8,400,000
-----------
TEXAS--10.5%
Angelina and Neches River Authority
Solid Waste Disposal RB MB(DOUBLE DAGGER) [A-1]
3.550% 03/22/96 ................................. 7,300 7,300,000
Brazos Higher Education Authority, Inc.
Student Loan RB DN / (Student Loan
Marketing Assoc. LOC)(DAGGER) [MIG]
3.200% 03/07/96 ................................. 9,000 9,000,000
Brazos River, TX Harbor [A-1]
3.350% 04/04/96 ................................. 2,500 2,500,000
Harris County Health Facility
Development Corp Texas Childrens'
DN [MIG]
3.300% 03/07/96 ................................. 2,200 2,200,000
Houston Water and Sewer TECP Notes
Series A Revolving Credit Agreement
With West Deutsche Landesbank
and Swiss [A-1]
3.150% 03/15/96 ................................. 4,000 4,000,000
San Antonio Housing Finance Corp.
(Wellington Place Apartments)
Series 1995 A DN(DAGGER) [A-1+]
3.400% 03/07/96 ................................. 3,000 3,000,000
State of Texas TRAN [SP-1]
4.750% 08/30/96 ................................. 15,000 15,047,150
Texas State VHA
3.900% 11/06/96 ................................. 4,000 4,000,000
Travis County HFA DCHS Bond MB(DOUBLE DAGGER)
4.000% 11/01/96 ................................. 430 431,023
-----------
47,478,173
-----------
PAR
(000) VALUE
------- -----------
UTAH--2.9%
Intermountain Power Agency DN(DAGGER) [A-1]
3.550% 06/15/96 ............................... $ 1,000 $ 1,000,000
Salt Lake Airport RB DN(DAGGER) [A-1+]
3.200% 03/07/96 ............................... 2,600 2,600,000
Utah State Board of Regents Student
Loan Revenue Series C RB DN /
(Dresdner Bank LOC)(DAGGER) [A-1+]
3.400% 03/07/96 ............................... 3,400 3,400,000
Utah State Board of Regents Student
Loan Revenue Series L DN /
(Dresdner Bank LOC)(DAGGER) [A-1+]
3.400% 03/07/96 ............................... 6,000 6,000,000
-----------
13,000,000
-----------
VIRGINIA--3.0%
Alexandria Virginia Redevelopment &
Housing Authority Multi-Family
Housing Series A DN(DAGGER) [A-1]
3.550% 03/07/96 ............................... 7,500 7,500,000
Capital Region Airport Commission
Richmond International Airport
Projects Series 1995-C DN /
(AMBAC Insurance)(DAGGER) [MIG]
3.300% 03/07/96 ............................... 2,500 2,500,000
Culpeper Town IDA Residential Care
Facility RB DN / (NCNB LOC)(DAGGER) [A-1]
3.400% 03/07/96 ............................... 1,500 1,500,000
Fairfax County IDA DN Series 1988c /
(Dai-Ichi Kangyo LOC)(DAGGER) [A1+]
3.500% 03/07/96 ............................... 200 200,000
Lynchburg VR Hospital RB FHA
Midatlantic Series 1985 E DN /
(AMBAC Insurance)DAGGER) [A-1]
3.250% 03/07/96 ............................... 800 800,000
Peninsula Ports Authority VR IDA RB
(Allied Signal Inc. Project)
Series 1993 (Allied Signal Corp
Obligation) DN(DAGGER) [A-1]
3.400% 03/07/96 ............................... 1,000 1,000,000
-----------
13,500,000
-----------
See Accompanying Notes to Financial Statements.
12
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MUNICIPAL MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
------- ------------
WASHINGTON--1.0%
Port of Seattle IDA DN
(Alaska Airlines Project) /
(Bank of America LOC)(DAGGER) [A-1]
3.100% 03/07/96 ............................. $ 4,580 $ 4,580,000
------------
WEST VIRGINIA--0.8%
Marshall County Industrial Development
Revenue US/Canada Project DN /
(Harris Trust & Savings
Bank LOC)(DAGGER) [A-1+]
3.450% 03/07/96 ............................. 3,500 3,500,000
------------
WISCONSIN--2.4%
Racine Wisconsin School District
TRAN MB [SP-1]
4.500% 08/23/96 ............................. 6,000 6,012,391
Wisconsin State Operating Notes
Series 1995 TRAN [SP-1]
4.500% 06/17/96 ............................. 5,000 5,015,457
------------
11,027,848
------------
TOTAL INVESTMENTS AT VALUE--99.6%
(Cost $450,600,697*) ........................ 450,600,697
OTHER ASSETS IN EXCESS OF
LIABILITIES--0.4% ........................... 2,015,775
------------
NET ASSETS (Applicable to 225,391,612
Bedford shares, 137,904,692
Bradford shares, 97,170 Cash
Preservation shares, 89,284,879
Janney Montgomery Scott
shares, 5,044 RBB shares
and 800 other shares)--100.0% ............... $452,616,472
============
NET ASSET VALUE, offering and
redemption price per share
(452,616,472 (DIVIDE) 452,684,197) .......... $1.00
=====
* Also cost for Federal income tax purposes
(DAGGER)Variable Rate Demand Notes -- The interest rate shown is the rate as of
February 29,1996 and the maturity date shown is the longer of the next
interest readjustment date or the date the principal amount shown can
be recovered though demand.
(DOUBLE DAGGER)Put Bonds -- Maturity date is the put date.
The Moody's Investor Service, Inc. and Standard & Poor's Ratings Group ratings
indicated are the most recent ratings available at February 29, 1996.
INVESTMENT ABBREVIATIONS
BAN ..................................................... Bond Anticipation Note
DN ................................................................. Demand Note
GO ......................................................... General Obligations
LOC ........................................................... Letter of Credit
IDA ........................................... Industrial Development Authority
MB ............................................................. Municipal Bond
PCR .................................................. Pollution Control Revenue
RAN .................................................. Revenue Anticipation Note
RAW .............................................. Revenue Anticipation Warrants
RB ................................................................ Revenue Bond
TAN ...................................................... Tax Anticipation Note
TECP ............................................... Tax Exempt Commercial Paper
TRAN ......................................... Tax and Revenue Anticipation Note
See Accompanying Notes to Financial Statements.
13
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
MUNICIPAL MONEY MARKET PORTFOLIO
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED
FEBRUARY 29, 1996 (UNAUDITED)
INVESTMENT INCOME
Interest ............................................... $ 8,047,570
-----------
EXPENSES
Investment advisory fees ............................... 691,055
Administration fees .................................... 209,622
Distribution fees ...................................... 1,173,898
Directors' fees ........................................ 2,745
Custodian fees ......................................... 43,373
Transfer agent fees .................................... 111,006
Legal fees ............................................. 9,557
Audit fees ............................................. 7,160
Registration fees ...................................... 88,000
Insurance expense ...................................... 5,205
Printing expense ....................................... 105,517
Miscellaneous .......................................... 204
-----------
2,447,342
Less fees waived ....................................... (594,812)
Less expense reimbursement by advisor .................. (7,738)
-----------
TOTAL EXPENSES ...................................... 1,844,792
-----------
NET INVESTMENT INCOME ..................................... 6,202,778
-----------
REALIZED LOSS ON INVESTMENTS .............................. (674)
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ........................................ $ 6,202,104
===========
STATEMENT OF CHANGES IN NET ASSETS
FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED
FEBRUARY 29, 1996 AUGUST 31, 1995
----------------- ---------------
(UNAUDITED)
Increase (decrease) in net assets:
Operations:
Net investment income ................. $ 6,202,778 $ 9,691,756
Net gain (loss) on
investments ......................... (674) 7,009
------------- -------------
Net increase in net assets
resulting from
operations .......................... 6,202,104 9,698,765
------------- -------------
Dividends to shareholders from
net investment income:
Bedford shares ($.0150 and
$.0297, respectively,
per share) .......................... (3,019,474) (5,717,451)
Bradford shares ($.0150 and
$.0297, respectively,
per share) .......................... (1,768,125) (3,266,535)
Cash Preservation shares
($.0143 and $.0281,
respectively, per share) ............ (2,432) (5,648)
Janney Montgomery Scott
shares ($.0142 and $.0063,
respectively, per share) ............ (1,412,676) (701,975)
RBB shares ($.0142 and
$.0279, respectively,
per share) .......................... (71) (147)
------------- -------------
Total dividends to
shareholders ...................... (6,202,778) (9,691,756)
------------- -------------
Net capital share
transactions .......................... 29,863,283 140,043,103
------------- -------------
Total increase in net assets ............. 29,862,609 140,050,112
Net Assets:
Beginning of period ................... 422,753,863 282,703,751
------------- -------------
End of period ......................... $ 452,616,472 $ 422,753,863
============= =============
See Accompanying Notes to Financial Statements.
14
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
GOVERNMENT OBLIGATIONS MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS
FEBRUARY 29, 1996
(UNAUDITED)
PAR
(000) VALUE
------- ------------
AGENCY OBLIGATIONS--61.5%
FEDERAL FARM CREDIT BANK--11.2%
5.120% 03/01/96 ............................... $12,980 $ 12,980,000
5.630% 03/01/96 ............................... 10,000 10,000,000
5.470% 03/05/96 ............................... 10,000 9,993,922
5.110% 03/06/96(DAGGER) ....................... 15,000 14,990,167
6.070% 06/03/96 ............................... 10,000 10,005,617
5.600% 07/01/96 ............................... 7,000 6,997,732
------------
64,967,438
------------
FEDERAL HOME LOAN BANK--8.4%
5.250% 03/02/96(DAGGER) ....................... 20,000 19,991,569
5.398% 03/20/96(DAGGER) ....................... 15,000 14,993,950
5.800% 04/29/96 ............................... 4,000 3,961,978
5.560% 10/25/96 ............................... 10,000 9,988,061
------------
48,935,558
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION--26.4%
6.050% 03/01/96 ............................... 5,000 5,000,000
5.300% 03/01/96(DAGGER) ....................... 5,000 5,000,000
5.425% 03/01/96(DAGGER) ....................... 10,000 9,998,279
4.990% 03/05/96(DAGGER) ....................... 10,000 10,000,000
5.070% 05/21/96(DAGGER) ....................... 25,000 24,985,369
6.480% 03/27/96 ............................... 25,000 25,024,454
5.230% 04/12/96 ............................... 40,000 39,755,467
8.500% 06/10/96 ............................... 2,930 2,955,328
5.590% 06/21/96 ............................... 5,000 4,998,057
5.620% 07/02/96 ............................... 10,000 10,001,180
5.910% 08/19/96 ............................... 15,000 15,020,039
------------
152,738,173
------------
STUDENT LOAN MARKETING ASSOCIATION(DAGGER)--15.5%
5.140% 03/05/96 ............................... 5,000 5,000,974
5.170% 03/05/96 ............................... 26,500 26,497,859
5.180% 03/05/96 ............................... 9,000 8,998,491
5.190% 03/05/96 ............................... 5,000 5,000,000
5.200% 03/05/96 ............................... 5,000 4,999,152
5.210% 03/05/96 ............................... 3,500 3,500,297
5.240% 03/05/96 ............................... 15,000 14,994,013
5.365% 03/05/96 ............................... 3,850 3,853,287
5.390% 03/05/96 ............................... 12,100 12,112,135
6.080% 07/01/96 ............................... 5,000 5,000,000
------------
89,956,208
------------
TOTAL AGENCY OBLIGATIONS
(Cost $356,597,377) ....................... 356,597,377
------------
PAR
(000) VALUE
------- ------------
U.S. TREASURY OBLIGATIONS--2.6%
U.S.TREASURY NOTE--2.6%
6.875% 02/28/97 ............................. $15,000 $ 15,246,199
------------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $15,246,199) ...................... 15,246,199
------------
REPURCHASE AGREEMENTS--35.5%
Goldman Sachs & Co. (Agreement dated
02/29/96 to be repurchased at
$80,012,111, collateralized by
$109,021,622 Federal National
Mortgage Assoc. 5.993% to 7.47%
due 02/25/22 to 06/01/30. Market
value of collateral is $81,944,567.)
5.450% 03/01/96 ............................. 80,000 80,000,000
Merrill Lynch (Agreement dated 02/29/96
to be repurchased at $115,061,643
collateralized by $42,571,653 Federal
National Home Loan ARM 6.00% to
9.00% due 11/1/98 to 8/20/25 and
collateralized by $ 96,097,954 Federal
Home Loan Mortgage Corp. Strip due
02/01/17 to 01/01/26. Market value
of collateral is $137,291,496.)
5.210% 03/01/96 ............................. 115,000 115,000,000
Paine Webber (Agreement dated
02/29/96 to be repurchased at
$10,501,677 collateralized by
$10,495,000 U.S. Treasury Note
6.25% due 08/31/00. Market
value of collateral is $10,711,512.)
5.750% 03/01/96 ............................. 10,500 10,500,000
------------
TOTAL REPURCHASE AGREEMENTS
(Cost $205,500,000) ..................... 205,500,000
------------
See Accompanying Notes to Financial Statements.
15
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
GOVERNMENT OBLIGATIONS MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS
FEBRUARY 29, 1996
(UNAUDITED)
VALUE
------------
TOTAL INVESTMENTS AT VALUE--99.6%
(Cost $577,343,576*) .................................... $577,343,576
OTHER ASSETS IN EXCESS OF
LIABILITIES--0.4% ....................................... 2,276,076
------------
NET ASSETS (Applicable to 215,654,678
Bedford shares,45,996,714 Bradford
shares 317,969,487 Janney
Montgomery Scott shares and 800
other shares)--100.0% ................................... $579,619,652
============
NET ASSET VALUE, offering and
redemption price per share
($579,619,652 (DIVIDE) 579,621,679) ..................... $1.00
=====
*Also cost for Federal income tax purposes.
(DAGGER) Variable Rate Obligations -- The interest rate shown is the rate as of
February 29, 1996 and the maturity date shown is the longer of the next
interest readjustment date or the date the principal amount shown can
be recovered through demand.
See Accompanying Notes to Financial Statements.
16
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
GOVERNMENT OBLIGATIONS MONEY MARKET PORTFOLIO
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED
FEBRUARY 29, 1996 (UNAUDITED)
INVESTMENT INCOME
Interest ............................................. $ 15,155,549
------------
EXPENSES
Investment advisory fees ............................. 1,115,533
Distribution fees .................................... 1,545,867
Directors' fees ...................................... 3,484
Custodian fees ....................................... 49,775
Transfer agent fees .................................. 329,553
Legal fees ........................................... 9,440
Audit fees ........................................... 9,018
Registration fees .................................... 51,500
Insurance expense .................................... 6,587
Printing expense ..................................... 51,193
Miscellaneous ........................................ 260
------------
3,172,210
Less fees waived ..................................... (540,871)
------------
TOTAL EXPENSES .................................... 2,631,339
------------
NET INVESTMENT INCOME ................................... 12,524,210
------------
REALIZED LOSS ON INVESTMENTS ............................ (746)
------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ...................................... $ 12,523,464
============
STATEMENT OF CHANGES IN NET ASSETS
FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED
FEBRUARY 29, 1996 AUGUST 31, 1995
----------------- ---------------
(UNAUDITED)
Increase (decrease) in net assets:
Operations:
Net investment income ................. $ 12,524,210 $ 12,855,095
Net gain (loss) on
investments ......................... (746) 41,241
------------- -------------
Net increase in net assets
resulting from
operations .......................... 12,523,464 12,896,336
------------- -------------
Dividends to shareholders from
net investment income:
Bedford shares ($.0236 and
$.0475 respectively,
per share) .......................... (4,319,420) (7,551,189)
Bradford shares ($.0236 and
$.0475, respectively,
per share) .......................... (1,121,560) (2,071,772)
Janney Montgomery Scott
shares ($.0234 and $.0109,
respectively, per share) ............ (7,083,230) (3,232,134)
Distributions to shareholders
from net realized
short-term gains:
Bedford shares ........................ (12,697) --
Bradford shares ....................... (3,154) --
Janney Montgomery Scott
shares .............................. (18,204) --
------------- -------------
Total distributions to
shareholders ...................... (12,558,265) (12,855,095)
------------- -------------
Net capital share
transactions .......................... 67,162,097 306,300,108
------------- -------------
Total decrease in net assets ............. 67,127,296 306,341,349
Net Assets:
Beginning of period ................... 512,492,356 206,151,007
------------- -------------
End of period ......................... $ 579,619,652 $ 512,492,356
============= ==============
See Accompanying Notes to Financial Statements.
17
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
FINANCIAL HIGHLIGHTS (B)
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
------------------------------------------------------------------------
FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE
SIX MONTHS YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
FEBRUARY 29, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31,
1996 1995 1994 1993 1992 1991
------------ ---------- ---------- ---------- ---------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- -------- -------- -------- -------- --------
Income from investment operations:
Net investment income ............ 0.0242 0.0486 0.0278 0.0243 0.0375 0.0629
Net gains on securities (both
realized and unrealized) ........ -- -- -- -- 0.0007 --
---------- -------- -------- -------- -------- --------
Total from investment
operations ................... 0.0242 0.0486 0.0278 0.0243 0.0382 0.0629
---------- -------- -------- -------- -------- --------
Less distributions:
Dividends (from net investment
income) ......................... (0.0242) (0.0486) (0.0278) (0.0243) (0.0375) (0.0629)
Distributions (from capital gains) -- -- -- -- (0.0007) --
---------- -------- -------- -------- -------- --------
Total distributions .......... (0.0242) (0.0486) (0.0278) (0.0243) (0.0382) (0.0629)
---------- -------- -------- -------- -------- --------
Net asset value, end of period ..... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ======== ======== ======== ======== ========
Total Return........................ 4.98%(c) 4.97% 2.81% 2.46% 3.89% 6.48%
Ratios /Supplemental Data
Net assets, end of period (000'S) $1,112,397 $935,821 $710,737 $782,153 $736,842 $747,530
Ratios of expenses to average
net assets....................... .97%(a)(c) .96%(a) .95%(a) .95%(a) .95%(a) .92%(a)
Ratios of net investment income
to average net assets............ 4.85%(c) 4.86% 2.78% 2.43% 3.75% 6.29%
</TABLE>
<TABLE>
<CAPTION>
MUNICIPAL MONEY MARKET PORTFOLIO
------------------------------------------------------------------------
FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE
SIX MONTHS YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
FEBRUARY 29, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31,
1996 1995 1994 1993 1992 1991
------------ ---------- ---------- ---------- ---------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
Income from investment operations:
Net investment income ............ 0.0150 0.0297 0.0195 0.0195 0.0287 0.0431
Net gains on securities (both
realized and unrealized) ........ -- -- -- -- -- --
-------- -------- -------- -------- -------- --------
Total from investment
operations ................... 0.0150 0.0297 0.0195 0.0195 0.0287 0.0431
-------- -------- -------- -------- -------- --------
Less distributions:
Dividends (from net investment
income) ......................... (0.0150) (0.0297) (0.0195) (0.0195) (0.0287) (0.0431)
Distributions (from capital gains) -- -- -- -- -- --
-------- -------- -------- -------- -------- --------
Total distributions .......... (0.0150) (0.0297) (0.0195) (0.0195) (0.0287) (0.0431)
-------- -------- -------- -------- -------- --------
Net asset value, end of period ..... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
Total Return........................ 3.06%(c) 3.01% 1.97% 1.96% 2.90% 4.40%
Ratios /Supplemental Data
Net assets, end of period (000'S) $225,322 $198,425 $182,480 $215,577 $176,950 $215,140
Ratios of expenses to average
net assets....................... .84%(a)(c) .82%(a) 77%(a) .77%(a) .77%(a) .74%(a)
Ratios of net investment income
to average net assets............ 3.00%(c) 2.97% 1.95% 1.95% 2.87% 4.31%
<FN>
(a) Without the waiver of advisory and administration fees and without the
reimbursement of certain operating expenses, the ratios of expenses to
average net assets for the Money Market Portfolio would have been 1.13%
annualized for the six months ended Februaury 29, 1996, 1.17%, 1.16%,
1.19%, 1.20% and 1.17% for the years ended August 31, 1995, 1994, 1993,
1992 and 1991, respectively. For the Municipal Money Market Portfolio, the
ratios of expenses to average net assets would have been 1.12% annualized
for the six months ended February 29, 1996, 1.14%, 1.12%, 1.16%, 1.15% and
1.13% for the years ended August 31, 1995, 1994, 1993, 1992 and 1991,
respectively.
(b) Financial Highlights relate solely to the Bedford Class of shares within
each portfolio.
(c) Annualized.
</FN>
</TABLE>
See Accompanying Notes to Financial Statements.
18
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
FINANCIAL HIGHLIGHTS (B)
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
GOVERNMENT OBLIGATIONS MONEY MARKET PORTFOLIO
--------------------------------------------------------------------------------------------
FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
FEBRUARY 29, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31,
1996 1995 1994 1993 1992 1991
---------------- ---------- ---------- ---------- ---------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
Income from investment
operations:
Net investment income ............ 0.0236 0.0475 0.0270 0.0231 0.0375 0.0604
Net gains on securities
(both realized and unrealized) .. -- -- -- -- 0.0009 --
-------- -------- -------- -------- -------- --------
Total from investment
operations ................... 0.0236 0.0475 0.0270 0.0231 0.0384 0.0604
-------- -------- -------- -------- -------- --------
Less distributions:
Dividends (from net
investment income) .............. (0.0236) (0.0475) (0.0270) (0.0231) (0.0375) (0.0604)
Distributions (from
capital gains) .................. -- -- -- -- (0.0009) --
-------- -------- -------- -------- -------- --------
Total distributions ........... (0.0236) (0.0475) (0.0270) (0.0231) (0.0384) (0.0604)
-------- -------- -------- -------- -------- --------
Net asset value, end of period ..... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN ....................... 4.84%(c) 4.86% 2.73% 2.33% 3.91% 6.21%
Ratios /Supplemental Data
Net assets, end of period (000's) $215,654 $163,398 $166,418 $213,741 $225,101 $368,899
Ratios of expenses to
average net assets .............. .975%(a)(c) .975%(a) .975%(a) .975%(a) .975%(a) .95%(a)
Ratios of net investment
income to average net assets .... 4.73%(c) 4.75% 2.70% 2.31% 3.75% 6.04%
<FN>
(a) Without the waiver of advisory and without the reimbursement of certain
operating expenses, the ratios of expenses to average net assets for the
Government Obligations Money Market Portfolio would have been 1.09%
annualized for the six months ended February 29, 1996, 1.13%, 1.17%, 1.18%,
1.12% and 1.13% for the years ended August 31, 1995, 1994, 1993, 1992 and
1991, respectively.
(b) Financial Highlights relate solely to the Bedford Class of shares within
each portfolio.
(c) Annualized.
</FN>
</TABLE>
See Accompanying Notes to Financial Statements.
19
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 29, 1996
(UNAUDITED)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The RBB Fund, Inc. (the "Fund") is registered under the Investment Company
Act of 1940, as amended, as an open-end management investment company. The Fund
was incorporated in Maryland on February 29, 1988.
The Fund has authorized capital of thirty billion shares of common stock of
which 12.2 billion shares are currently classified into sixty-one classes. Each
class represents an interest in one of seventeen investment portfolios of the
Fund, fifteen of which are currently in operation. The classes have been grouped
into fifteen separate "families", eight of which have begun investment
operations: the RBB Family, the BEA Family, the Sansom Street Family, the
Bedford Family, the Cash Preservation Family, Janney Montgomery Scott Money
Funds, the Warburg Pincus Family and the Bradford Family. The Bedford Family
represents interests in four portfolios, three of which are covered in this
report.
A) SECURITY VALUATION -- Portfolio securities are valued under
the amortized cost method, which approximates current market value. Under
this method, securities are valued at cost when purchased and thereafter a
constant proportionate amortization of any discount or premium is recorded
until maturity of the security. Regular review and monitoring of the
valuation is performed in an attempt to avoid dilution or other unfair
results to shareholders. The Fund seeks to maintain net asset value per
share at $1.00 for these portfolios.
B) SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security
transactions are accounted for on the trade date. The cost of investments
sold is determined by use of the specific identification method for both
financial reporting and income tax purposes. Interest income is recorded on
the accrual basis. Certain expenses, principally distribution, transfer
agency and printing, are class specific expenses and vary by class.
Expenses not directly attributable to a specific portfolio or class are
allocated based on relative net assets of each portfolio and class,
respectively.
C) DISTRIBUTIONS TO SHAREHOLDERS -- Dividends from net investment
income are declared daily and paid monthly. Any net realized capital gains
will be distributed at least annually. Income distributions and capital
gain distributions are determined in accordance with tax regulations which
may differ from generally accepted accounting principles.
D) FEDERAL INCOME TAXES -- No provision is made for Federal taxes
as it is the Fund's intention to have each portfolio continue to qualify
for and elect the tax treatment applicable to regulated investment
companies under the Internal Revenue Code and make the requisite
distributions to its shareholders which will be sufficient to relieve it
from Federal income and excise taxes.
E) REPURCHASE AGREEMENTS -- Money market instruments may be
purchased subject to the seller's agreement to repurchase them at an agreed
upon date and price. The seller will be required on a daily basis to
maintain the value of the securities subject to the agreement at not less
than the repurchase price. The agreements are conditioned upon the
collateral being deposited under the Federal Reserve book-entry system or
with the Fund's custodian or a third party sub-custodian.
F) 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.
20
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES
Pursuant to Investment Advisory Agreements, PNC Institutional Management
Corporation ("PIMC"), a wholly subsidiary of PNC Asset Management Group, Inc.,
which is in turn a wholly owned subsidiary of PNC Bank, National Association
("PNC Bank"), serves as investment advisor for the three portfolios described
herein. PNC Bank serves as the sub-advisor for the Money Market, the Municipal
Money Market and the Government Obligations Money Market Portfolios.
For its advisory services, PIMC is entitled to receive the following fees,
computed daily and payable monthly based on each of the three portfolio's
average daily net assets:
PORTFOLIO ANNUAL RATE
- --------------------------- ---------------------------------------------
Money Market and Government .45% of first $250 million of net assets;
Obligations Money Markets .40% of next $250 million of net assets;
Portfolios .35% of net assets in excess of $500 million.
Municipal Money Market .35% of first $250 million of net assets;
Portfolio .30% of next $250 million of net assets;
.25% of net assets in excess of $500 million.
PIMC may, at its discretion, voluntarily waive all or any portion of its
advisory fee for these portfolios. For each class of shares within a respective
portfolio, the net advisory fee charged to each class is the same on a relative
basis. For the six months ended February 29, 1996, advisory fees and waivers for
the three investment portfolios were as follows:
GROSS NET
ADVISORY ADVISORY
FEE WAIVER FEE
---------- ----------- ----------
Money Market Portfolio $3,571,794 $(1,589,182) $1,982,612
Municipal Money Market Portfolio 691,055 (585,935) 105,120
Government Obligations Money Market
Portfolio 1,115,533 (317,599) 797,934
PNC Bank, as sub-advisor, receives a fee directly from PIMC, not the
portfolios. In addition, PNC Bank serves as custodian for each of the Fund's
portfolios. PFPC Inc. ("PFPC"), an indirect wholly owned subsidiary of PNC Bank
Corp., serves as each class's transfer and dividend disbursing agent.
21
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES (CONTINUED)
PFPC may, at its discretion, voluntarily waive all or any portion of its
transfer agency fee for any class of shares. For the six months ended February
29,1996, transfer agency fees and waivers for each class of shares within the
three investment portfolios were as follows:
GROSS NET
TRANSFER AGENCY TRANSFER AGENCY
FEE WAIVER FEE
--------------- ------------ ---------------
Money Market Portfolio
Bedford Class $ 760,533 $ -- $ 760,533
Cash Preservation Class 4,608 (4,307) 301
Janney Montgomery Scott Class 481,520 (168,268) 313,252
RBB Class 4,400 (4,303) 97
Sansom Street Class 125,119 -- 125,119
----------- ------------ -------------
Total Money Market Portfolio $ 1,376,180 $ (176,878) $ 1,199,302
=========== ============ =============
Municipal Money Market Portfolio
Bedford Class $ 54,768 $ -- $ 54,768
Bradford Class 11,759 -- 11,759
Cash Preservation Class 4,807 (4,509) 298
Janney Montgomery Scott Class 35,292 -- 35,292
RBB Class 4,380 (4,368) 12
----------- ------------ -------------
Total Municipal Money Market
Portfolio $ 111,006 $ (8,877) $ 102,129
=========== ============ =============
Government Obligations Money Market
Portfolio
Bedford Class $ 43,073 $ -- $ 43,073
Bradford Class 13,193 -- 13,193
Janney Montgomery Scott Class 273,287 (223,272) 50,015
----------- ------------ -------------
Total Government Obligations
Money Market Portfolio $ 329,553 $ (223,272) $ 106,281
=========== ============ =============
In addition, PFPC serves as administrator for the Municipal Money Market
Portfolio. The administration fee is computed daily and payable monthly at an
annual rate of .10% of the Portfolio's average daily assets. For the six months
ended February 29, 1996, the administration fee for the Municipal Money Market
Portfolio was as follows:
ADMINISTRATION
FEE
--------------
Municipal Money Market Portfolio $ 209,622
The Fund, on behalf of each class of shares within the three investment
portfolios, has adopted Distribution Plans pursuant to Rule 12b-1 under the
Investment Company Act of 1940, as amended, and has entered into Distribution
Contracts with Counsellors Securities Inc. ("Counsellors"), which provide for
each class to make monthly payments, based on average net assets, to Counsellors
of up to .65% on an annualized basis for the Bedford, Bradford, Cash
Preservation, Janney Montgomery Scott and RBB Classes and up to .20% on an
annualized basis for the Sansom Street Class.
22
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES (CONTINUED)
For the six months ended February 29,1996, distribution fees for each class
were as follows:
DISTRIBUTION
FEE
-------------
Money Market Portfolio
Bedford Class $ 2,730,852
Cash Preservation Class 422
Janney Montgomery Scott Class 1,463,057
RBB Class 110
Sansom Street Class 147,432
-----------
Total Money Market Portfolio $ 4,341,873
===========
Municipal Money Market Portfolio
Bedford Class $ 554,690
Bradford Class 321,494
Cash Preservation Class 331
Janney Montgomery Scott Class 297,373
RBB Class 10
-----------
Total Municipal Money Market Portfolio $ 1,173,898
============
Government Obligations Money Market Portfolio
Bedford Class $ 516,059
Bradford Class 127,915
Janney Montgomery Scott Class 901,893
-----------
Total Government Obligations
Money Market Portfolio $ 1,545,867
===========
The Fund has entered into service agreements with banks affiliated with PNC
Bank who render support services to customers who are the beneficial owners of
the Sansom Street Class in consideration of the payment of .10% of the daily net
asset value of such shares. For the six months ended February 29, 1996, service
organization fees were $207,199 for the Money Market Portfolio and $0 for the
Municipal Money Market Portfolio.
23
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
NOTE 3. CAPITAL SHARES
Transactions in capital shares (at $1 per capital share) for each period
were as follows:
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO MUNICIPAL MONEY MARKET PORTFOLIO
------------------------------------------------- -----------------------------------------------------
FOR THE FOR THE FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
FEBRUARY 29, 1996 AUGUST 31, 1995 FEBRUARY 29, 1996 AUGUST 31, 1995
--------------------- --------------------- ----------------------- -------------------
(UNAUDITED) (UNAUDITED)
VALUE VALUE VALUE VALUE
--------------------- --------------------- ----------------------- -------------------
<S> <C> <C> <C> <C>
Shares sold:
BEDFORD CLASS $ 1,912,107,897 $ 2,966,911,277 $ 528,809,679 $ 1,104,088,188
Bradford Class -- -- 246,378,318 474,166,249
Cash Preservation Class 76,761 84,527 130,118 175,548
Janney Montgomery
Scott Class 1,126,947,114 855,058,809 217,548,443 208,067,881
RBB Class 6,693 31,504 400 5,004
Sansom Street Class 946,518,676 1,864,628,110 -- --
Shares issued in reinvestment
of dividends:
Bedford Class 24,390,767 37,681,204 2,998,655 5,576,408
Bradford Class -- -- 1,738,434 3,126,860
Cash Preservation Class 5,178 11,226 2,301 5,478
Janney Montgomery
Scott Class 11,597,010 4,534,944 1,418,406 662,565
RBB Class 1,340 2,500 72 146
Sansom Street Class 8,591,868 16,689,941 -- --
Shares repurchased:
Bedford Class (1,759,920,802) (2,779,499,052) (504,911,015) (1,093,651,142)
Bradford Class -- -- (221,147,616) (466,448,018)
Cash Preservation Class (84,987) (91,268) (196,520) (220,601)
Janney Montgomery
Scott Class (1,053,312,158) (415,944,656) (242,906,025) (95,506,391)
RBB Class (5,503) (23,917) (367) (5,072)
Sansom Street Class (860,251,286) (1,813,444,951) -- --
--------------- --------------- -------------- ---------------
Net increase $ 356,668,568 $ 736,630,198 $ 29,863,283 $ 140,043,103
=============== =============== ============== ===============
Bedford Shares authorized 1,500,000,000 1,500,000,000 500,000,000 500,000,000
=============== =============== ============== ===============
</TABLE>
24
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
NOTE 3. CAPITAL SHARES (CONTINUED)
GOVERNMENT OBLIGATIONS MONEY MARKET PORTFOLIO
-------------------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED
FEBRUARY 29, 1996 AUGUST 31, 1995
----------------- ---------------
(UNAUDITED)
VALUE VALUE
------------ -------------
Shares sold:
Bedford Class $ 420,087,621 $ 461,728,190
Bradford Class 84,720,763 192,414,935
Janney Montgomery Scott Class 605,713,061 533,143,649
Shares issued in reinvestment
of dividends:
Bedford Class 4,328,433 7,147,384
Bradford Class 1,121,626 2,029,050
Janney Montgomery Scott Class 7,049,583 3,065,158
Shares repurchased:
Bedford Class (372,153,027) (471,908,601)
Bradford Class (86,352,310) (187,671,346)
Janney Montgomery Scott Class (597,353,653) (233,648,311)
------------- --------------
Net increase $ 67,162,097 $ 306,300,108
============= ==============
Bedford Shares authorized 500,000,000 500,000,000
============= ==============
NOTE 4. NET ASSETS
At February 29,1996, net assets consisted of the following: (Unaudited)
GOVERNMENT
MUNICIPAL OBLIGATIONS
MONEY MARKET MONEY MARKET MONEY MARKET
PORTFOLIO PORTFOLIO PORTFOLIO
-------------- ------------ ------------
Capital paid-in:
Bedford Class $1,112,410,124 $225,391,612 $215,654,678
Bradford Class -- 137,904,692 45,996,714
Cash Preservation Class 232,617 97,170 --
Janney Montgomery Scott Class 528,881,063 89,284,879 317,969,487
RBB Class 57,931 5,044 --
Sansom Street Class 536,478,247 -- --
Other Classes 800 800 800
Accumulated net realized gain
(loss) on investments:
Bedford Class (12,775) (69,816) (754)
Bradford Class -- 341 (161)
Cash Preservation Class (2) 6 --
Janney Montgomery Scott Class (5,419) 1,744 (1,112)
RBB Class -- -- --
Sansom Street Class (6,122) -- --
------------- ------------ ------------
$2,178,036,464 $452,616,472 $579,619,652
============== ============ ============
25
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
NOTE 5. OTHER FINANCIAL HIGHLIGHTS
The Fund currently offers four other classes of shares representing
interests in the Money Market Portfolio: Cash Preservation, Janney Montgomery
Scott, RBB and Sansom Street. The Fund currently offers four other classes of
shares representing interests in the Municipal Money Market Portfolio: Bradford,
Cash Preservation, Janney Montgomery Scott and RBB. The Fund currently offers
two other class of shares representing an interest in the Government Obligations
Money Market Portfolio: Bradford and Janney Montgomery Scott. Each class is
marketed to different types of investors. Financial Highlights of the RBB and
Cash Preservation Classes are not presented in this report due to their
immateriality. Such information is available in the annual reports of each
respective family. The financial highlights of certain of the other classes are
as follows:
<TABLE>
<CAPTION>
BRADFORD GOVERNMENT OBLIGATIONS MONEY MARKET SHARES
FOR THE PERIOD
FOR THE FOR THE FOR THE FOR THE JANUARY 10, 1992
SIX MONTHS YEAR YEAR YEAR (COMMENCEMENT OF
ENDED ENDED ENDED ENDED OPERATIONS) TO
FEBRUARY 29, 1996 AUGUST 31, 1995 AUGUST 31, 1994 AUGUST 31, 1993 AUGUST 31, 1992
----------------- --------------- --------------- --------------- ----------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------ ------------ ------------ ------------ -----------
Income from investment operations:
Net investment income ........... 0.0236 0.0475 0.0270 0.0231 0.0208
Net gains on securities (both
realized and unrealized) ..... -- -- -- -- 0.0009
------------ ------------ ------------ ------------ -----------
Total from investment
operations 0.0236 0.0475 0.0270 0.0231 0.0217
Less distributions:
Dividends (from net investment
income) ...................... (0.0236) (0.0475) (0.0270) (0.0231) (0.0208)
Distributions (from capital
gains) ....................... -- -- -- (0.0009)
------------ ------------ ------------ ------------ -----------
Total distributions ......... (0.0236) (0.0475) (0.0270) (0.0231) (0.0217)
------------ ------------ ------------ ------------ -----------
Net asset value, end of period ..... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
============ ============ ============ ============ ===========
Total Return ....................... 4.84% 4.86% 2.73% 2.33% 3.42%(b)
Ratios/Supplemental Data
Net assets, end of period ....... $ 45,996,553 $ 46,508,798 $ 39,732,414 $ 50,522,979 $42,476,965
Ratios of expenses to
average net assets ........... .975%(a)(b) .975%(a) .975%(a) .975%(a) .975%(a)(b)
Ratios of net investment
income to average net assets .... 4.73%(b) 4.75% 2.70% 2.31% 3.23%(b)
<FN>
(a) Without the waiver of advisory fees and without the reimbursement of
certain operating expenses, the ratios of expenses to average net assets
would have been 1.09% annualized for the six months ended February 29,
1996, 1.13%, 1.18% and 1.18% for the years ended August 31, 1995, 1994, and
1993, respectively and 1.15% annualized for the period ended August 31,
1992.
(b) Annualized.
</FN>
</TABLE>
26
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
NOTE 5. OTHER FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
BRADFORD MUNICIPAL MONEY MARKET SHARES
FOR THE PERIOD
FOR THE FOR THE FOR THE FOR THE JANUARY 10, 1992
SIX MONTHS YEAR YEAR YEAR (COMMENCEMENT OF
ENDED ENDED ENDED ENDED OPERATIONS) TO
FEBRUARY 29, 1996 AUGUST 31, 1995 AUGUST 31, 1994 AUGUST 31, 1993 AUGUST 31, 1992
----------------- --------------- --------------- --------------- ----------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment operations:
Net investment income ......... 0.0150 0.0297 0.0195 0.0195 0.0154
------------ ------------ ------------ ----------- -----------
Total from investment
operations ............ 0.0150 0.0297 0.0195 0.0195 0.0154
------------ ------------ ------------ ----------- -----------
Less distributions:
Dividends (from net investment
income) ................... (0.0150) (0.0297) (0.0195) (0.0195) (0.0154)
------------ ------------ ------------ ----------- -----------
Total distributions ....... (0.0150) (0.0297) (0.0195) (0.0195) (0.0154)
------------ ------------ ------------ ----------- -----------
Net asset value, end of period ... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
============ ============ ============ =========== ===========
Total Return ..................... 3.06%(b) 3.01% 1.97% 1.96% 2.42%(b)
Ratios/Supplemental Data
Net assets, end of period ..... $137,905,033 $110,936,102 $100,089,172 $76,975,393 $69,586,281
Ratios of expenses to average
net assets ............... .84%(a)(b) .82%(a) .77%(a) .77%(a) .77%(a)(b)
Ratios of net investment income
to average net assets .... 3.00%(b) 2.97% 1.95% 1.95% 2.40%(b)
<FN>
(a) Without the waiver of advisory and administration fees and without
reimbursement of certain operating expenses, the ratios of expenses to
average net assets would have been 1.12% annualized for the six months
ended February 29, 1996, 1.14%, 1.11% and 1.16% for the years ended August
31, 1995, 1994, and 1993, respectively and 1.16% annualized for the period
ended August 31, 1992.
(b) Annualized.
</FN>
</TABLE>
27
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 29, 1996
(UNAUDITED)
NOTE 5. OTHER FINANCIAL HIGHLIGHTS (CONTINUED)
THE JANNEY MONTGOMERY SCOTT FAMILY
<TABLE>
<CAPTION>
MUNICIPAL MONEY MARKET GOVERNMENT OBLIGATIONS
MONEY MARKET PORTFOLIO PORTFOLIO MONEY MARKET PORTFOLIO
----------------------------------- ---------------------------------- ----------------------------------
FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD
FOR THE JUNE 12, 1995 FOR THE JUNE 12, 1995 FOR THE JUNE 12, 1995
SIX MONTHS (COMMENCEMENT SIX MONTHS (COMMENCEMENT SIX MONTHS (COMMENCEMENT
ENDED OF OPERATIONS) TO ENDED OF OPERATIONS) TO ENDED OF OPERATIONS) TO
FEBRUARY 29, 1996 AUGUST 31, 1995 FEBRUARY 29, 1996 AUGUST 31, 1995 FEBRUARY 29, 1996 AUGUST 31, 1995
----------------- ---------------- ----------------- --------------- ----------------- ---------------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
VALUE VALUE VALUE VALUE VALUE VALUE
----------------- ---------------- ----------------- --------------- ----------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------ ------------ ----------- ------------ ------------ ------------
Income from investment
operations:
Net investment income 0.0240 0.0112 0.0142 0.0063 0.0234 0.0109
------------ ------------ ----------- ------------ ------------ ------------
Total from investment
operations ........ 0.0240 0.0112 0.0142 0.0063 0.0234 0.0109
------------ ------------ ----------- ------------ ------------ ------------
Less distributions:
Dividends (from net
investment income) .... (0.0240) (0.0112) (0.0142) (0.0063) (0.0234) (0.0109)
------------ ------------ ----------- ------------ ------------ ------------
Total distributions ... (0.0240) (0.0112) (0.0142) (0.0063) (0.0234) (0.0109)
------------ ------------ ----------- ------------ ------------ ------------
Net asset value,
end of period .......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
============ ============ =========== ============ ============ ============
Total Return 4.49%(b) 5.30%(b) 2.89%(b) 2.87%(b) 4.82%(b) 5.03%(b)
Ratios/Supplemental Data
Net assets, end of period $528,875,644 $443,644,599 $89,286,623 $113,225,932 $317,968,375 $302,584,844
Ratios of expenses to average
net assets ............. 1.00%(a)(b) 1.00%(a)(b) 1.00%(a)(b) 1.00%(a)(b) 1.00%(a)(b) 1.00%(a)(b)
Ratios of net investment
income to average
net assets ............ 4.82%(b) 5.04(b) 2.84%(b) 2.83%(b) 4.70%(b) 4.91%(b)
<FN>
(a) Without the waiver of advisory, administration and transfer agent fees and without the reimbursement of certain
operating expenses, the ratios of expenses to average net assets for the Money Market Portfolio would have been
1.23% annualized for the six months ended February 29, 1996 and 1.23% annualized for the period ended August 31,
1995. For the Municipal Money Market Portfolio, the ratio of expenses to average net assets would have been 1.28%
annualized for the six months ended February 29, 1996 and 1.30% annualized for the period ended August 31, 1995.
For the Government Obligations Money Market Portfolio, the ratio of expenses to average net assets would have been
1.27% annualized for the six months ended February 29, 1996 and 1.28% annualized for the period ended August 31,
1995.
(b) Annualized.
</FN>
</TABLE>
28
<PAGE>
THE BEDFORD FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
FEBRUARY 29, 1996
(UNAUDITED)
NOTE 5. OTHER FINANCIAL HIGHLIGHTS (CONTINUED)
THE SANSOM STREET FAMILY
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
--------------------------------------------------------------------------------------------------------
FOR THE FOR THE FOR THE FOR THE FOR THE
SIX MONTHS YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
FEBRUARY 29, 1996 AUGUST 31, 1995 AUGUST 31, 1994 AUGUST 31, 1993 AUGUST 31, 1992 AUGUST 31, 1991
----------------- --------------- --------------- --------------- --------------- ---------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period ............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------ ------------ ------------ ------------ ------------ ------------
Income from investment
operations:
Net investment income ... 0.0266 0.0543 0.0334 0.0304 0.0435 0.0684
Net gains on securities
(both realized
and unrealized) ........ -- -- -- -- 0.0007 --
------------ ------------ ------------ ------------ ------------ ------------
Total from investment
operations ......... 0.0266 0.0543 0.0334 0.0304 0.0442 0.0684
------------ ------------ ------------ ------------ ------------ ------------
Less distributions:
Dividends (from net
investment income) ... (0.0266) (0.0543) (0.0334) (0.0304) (0.0435) (0.0684)
Distributions (from
capital gains) ....... -- -- -- -- (0.0007) --
------------ ------------ ------------ ------------ ------------ ------------
Total distributions .. (0.0266) (0.0543) (0.0334) (0.0304) (0.0442) (0.0684)
------------ ------------ ------------ ------------ ------------ ------------
Net asset value,
end of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
============ ============ ============ ============ ============ ============
Total Return .............. 5.49%(b) 5.57% 3.39% 3.08% 4.51% 7.06%
Ratios/Supplemental Data
Net assets, end of period $536,472,125 $441,613,801 $373,745,178 $190,794,098 $228,078,764 $138,417,995
Ratios of expenses to
average net assets ... .48%(a)(b) .39%(a) .39%(a) .34%(a) .35%(a) .37%(a)
Ratios of net investment
income to average
net assets ........... 5.34%(b) 5.43% 3.34% 3.04% 4.35% 6.84%
<FN>
(a) Without the waiver of advisory and without the reimbursement of certain
operating expenses, the ratios of expenses to average net assets for the
Money Market Portfolio would have been .64% annualized for the six months
ended February 29, 1996, .59%, .60%, .60%, .61% and .61% for the years
ended August 31, 1995, 1994, 1993, 1992 and 1991, respectively.
(b) Annualized.
</FN>
</TABLE>
29
<PAGE>
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