ANNUAL REPORT
AUGUST 31, 1999
[Logo of Hibernia Funds]
Hibernia Capital Appreciation Fund
Class A Shares
Class B Shares
Hibernia Louisiana Municipal Income Fund
Hibernia Mid Cap Equity Fund
Class A Shares
Class B Shares
Hibernia Total Return Bond Fund
Hibernia U.S. Government Income Fund
Hibernia Cash Reserve Fund
Class A Shares
Class B Shares
Hibernia U.S. Treasury Money Market Fund
<TABLE>
<CAPTION>
Table of Contents
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President's Message 1
Management Discussion and Analysis 3
Portfolios of Investments 17
Notes to Portfolios of Investments 36
Statements of Assets and Liabilities 38
Statements of Operations 40
Statements of Changes in Net Assets 42
Financial Highlights 46
Combined Notes to Financial Statements 48
Report of Ernst & Young LLP, Independent Auditors 56
</TABLE>
. Shares of Hibernia Funds are not deposits or obligations of Hibernia National
Bank or its affiliates, are not endorsed or guaranteed by Hibernia National
Bank or its affiliates, and are not insured by the Federal Deposit Insurance
Corporation, the Federal Reserve Board, or any other government agency.
. Investment in the shares of Hibernia Funds involves investment risks,
including the possible loss of principal amount invested.
. Hibernia Cash Reserve Fund and Hibernia U.S. Treasury Money Market Fund
attempt to maintain a stable net asset value of $1.00 per share; there can be
no assurance that these Funds will be able to do so.
President's Message
Dear Shareholder:
I am pleased to present the Annual Report to Shareholders for the Hibernia
Funds. The report, which covers the funds' 12-month fiscal year reporting period
from September 1, 1998 through August 31, 1999, includes an interview with each
fund's portfolio manager, as well as a complete list of portfolio holdings and
financial statements for each fund.
Please note the following highlights for each fund over the 12-month reporting
period:
. In a bull market that continued to march on amid a high level of day-to-day
volatility, Hibernia Capital Appreciation Fund produced an extremely strong
total return. For Class A Shares, the total return was 38.35%.* Contributing
to the total return were dividends of $0.02 per share and capital gains of
$2.79 per share, and a 23% increase in net asset value. For Class B Shares,
the total return was 37.35%.* Contributing to the total return were capital
gains of $2.79 per share and a 22% increase in net asset value. At the end of
the reporting period, net assets in the fund reached $371.3 million.
. Hibernia Louisiana Municipal Income Fund, a high-quality portfolio designed
for tax-sensitive Louisiana residents, paid double-tax-free dividends**
totaling $0.54 per share and capital gains totaling $0.08 per share. In a
rising rate environment that caused bond prices to decline, the fund's net
asset value decreased from $11.47 on the first day of the reporting period to
$10.85 on the last day of the reporting period. As a result, the fund's total
return was a flat (0.08%).* At the end of the reporting period, net assets
totaled $92.7 million.
. Hibernia Mid Cap Equity Fund produced an extremely strong total return. For
Class A Shares, the total return was 39.43%*, while Class B Shares produced a
total return of 38.87%.* A significant increase in net asset value continued
to account for the fund's returns. At the end of the reporting period, net
assets in the fund reached $20.3 million.
. Hibernia Total Return Bond Fund, a diversified portfolio of bonds, paid a
strong dividend stream that totaled $0.57 per share and capital gains
totaling $0.03 per share. In a rising rate environment, the fund's net asset
value decreased from $10.27 on the first day of the reporting period to $9.68
on the last day of the reporting period. As a result, the fund produced a
flat total return of (0.03%).* At the end of the reporting period, net assets
stood at $79.9 million.
* Performance quoted represents past performance. Investment return and
principal value will fluctuate, so an investor's shares, when redeemed, may be
worth more or less than their original cost. Total returns quoted above are
based on net asset value and do not reflect the maximum sales charges. Total
returns based on the maximum sales charge for the 12-month reporting period are
as follows: Hibernia Capital Appreciation Fund Class A Shares, 32.10%; Hibernia
Capital Appreciation Fund Class B Shares, 31.85%; Hibernia Louisiana Municipal
Income Fund, (3.04%); Hibernia Mid Cap Equity Fund Class A Shares, 33.22%;
Hibernia Mid Cap Equity Fund Class B Shares, 33.37%, and Hibernia Total Return
Bond Fund, (3.05%).
** Income may be subject to the federal alternative minimum tax.
. Hibernia U.S. Government Income Fund paid a strong dividend stream totaling
$0.57 per share, while its net asset value decreased in a rising rate
environment from $10.33 to $9.81. As a result, the fund produced a flat total
return of 0.41%.* Net assets ended the period at $84.2 million.
. Hibernia Cash Reserve Fund, a portfolio of high quality money market
securities, paid dividends of $0.04 per share for Class A Shares and $0.03
per share for Class B Shares. At the end of the reporting period, net assets
stood at more than $157.2 million.
. Hibernia U.S. Treasury Money Market Fund, a portfolio of U.S. Treasury money
market securities, paid dividends of $0.04 per share. At the end of the
period, net assets stood at more than $213.8 million.
Thank you for putting your money to work in one or more key financial markets
through the professional management and diversification of the Hibernia Funds.
We are committed to providing you with the highest level of service as we keep
you up-to-date on your investment progress.
Sincerely,
/s/ Edward C. Gonzales
Edward C. Gonzales
President
October 15, 1999
*Performance quoted represents past performance. Investment return and
principal value will fluctuate, so an investor's shares, when redeemed, may be
worth more or less than their original cost. Total returns quoted above are
based on net asset value and do not reflect the maximum sales charges. Total
return based on the maximum sales charge for the 12-month reporting period for
Hibernia U.S. Government Income Fund is (2.61%).
Management Discussion & Analysis
Hibernia Capital Appreciation Fund
Annual Report/12-month period from September 1, 1998 through August 31, 1999
Q
The bull market marched on during the fund's fiscal year, despite high
day-to-day volatility and narrow breadth. What are your comments?
A
The demand for large cap growth stocks continued, although at a slower pace than
in previous years. Technology stocks continued to lead the way, with internet
stocks the stars.
Q
Hibernia Capital Appreciation Fund continued to produce strong returns for the
period. What was the fund's total return over the 12-month reporting period
ended August 31, 1999?
A
Total return for the fund for the 12 months ended August 31, 1999, was 38.35%*
for Class A Shares and 37.35%* for Class B Shares. The fund's peer group, Lipper
Growth and Income Funds Average total return was 31.14%.
Q
As we leave a strong, yet erratic, year for stocks and approach the year 2000,
what factors will determine the direction of the market?
A
The final resolution of Y2K, the final outcome of the Federal Reserve Board's
(the "Fed") actions versus interest rates, global economics, and growth in the
U.S. will determine the direction of the market.
* Performance quoted represents past performance and is not indicative of
future results. Investment return and principal value will flucuate, so that an
investor's shares, when redeemed, may be worth more or less than their original
cost. Total returns quoted above are based on net asset value and do not
reflect the maximum sales charge. Total returns based on the maximum sales
charge are Class A Shares, 32.10% and Class B Shares, 31.85%.
Hibernia Capital Appreciation Fund--Class A Shares
Growth of $10,000 Invested in Hibernia Capital Appreciation Fund--Class A Shares
The graph below illustrates the hypothetical investment of $10,000 in the
Hibernia Capital Appreciation Fund--Class A Shares (the "Fund") from August 31,
1989 to August 31, 1999, compared to the Standard & Poor's 500 Index ("S&P
500").+
[Chart goes here]
AVERAGE ANNUAL TOTAL RETURN** FOR THE
PERIOD ENDED AUGUST 31, 1999
1 Year...........................................................32.10%
5 Years..........................................................22.53%
10 Years.........................................................15.40%
Past performance is not predictive of future performance. Your investment return
and principal value will fluctuate so when shares are redeemed, they may be
worth more or less than original cost. Mutual funds are not obligations of or
guaranteed by any bank and are not federally insured.
+ The S&P 500 is not adjusted to reflect sales loads, expenses, or other fees
that the SEC requires to be reflected in the Fund's performance. This index is
unmanaged.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the original maximum sales charge of 4.50% ($10,000 investment minus $450
sales charge = $9,550), which was effective October 14, 1988 (start of
performance). For the period from October 31, 1993 to August 31, 1996, the
sales charge was reduced to 3.00%. Effective September 1, 1996, the maximum
sales charge has been changed to 4.50%. The Fund's performance assumes the
reinvestment of all dividends and distributions. The S&P 500 has been adjusted
to reflect reinvestment of dividends on securities in the index.
**Total return quoted reflects the current 4.50% sales charge.
Hibernia Capital Appreciation Fund--Class B Shares
Growth of $10,000 Invested in Hibernia Capital Appreciation Fund--Class B Shares
The graph below illustrates the hypothetical investment of $10,000 in the
Hibernia Capital Appreciation Fund--Class B Shares (the "Fund") from December 2,
1996 (start of performance) to August 31, 1999, compared to the Standard &
Poor's 500 Index ("S&P 500").+
[Chart goes here]
AVERAGE ANNUAL TOTAL RETURN** FOR THE
PERIOD ENDED AUGUST 31, 1999
1 Year...........................................................31.85%
Start of Performance (12/2/96)...................................20.18%
Past performance is not predictive of future performance. Your investment return
and principal value will fluctuate so when shares are redeemed, they may be
worth more or less than original cost. Mutual funds are not obligations of or
guaranteed by any bank and are not federally insured.
+ The S&P 500 is not adjusted to reflect sales loads, expenses, or other fees
that the SEC requires to be reflected in the Fund's performance. This index is
unmanaged.
* Represents a hypothetical investment of $10,000 in the Fund. The ending value
of the Fund reflects a 4.00% contingent deferred sales charge on any
redemption less than three years from the purchase date. The Fund's
performance assumes the reinvestment of all dividends and distributions. The
S&P 500 has been adjusted to reflect reinvestment of dividends on securities
in the index.
**Total return quoted reflects all applicable contingent deferred sales
charges.
Hibernia Louisiana Municipal Income Fund
Annual Report/12-month period from September 1, 1998 through August 31, 1999
Q
Although total returns have been flat due to a rising rate environment,
municipal bonds have been rewarding investors with very competitive yields vs.
U.S. Treasury securities. What is your review of the municipal bond market over
the 12-month reporting period?
A
Municipal bond prices held up extremely well in the face of a declining Treasury
bond market. While a 10-year treasury bond experienced a total return decline of
(3.08%) over the 12 months ended August 31, 1999, the total return on 10-year
municipal bonds was up slightly at 0.68%. This was largely the result of the
relative value offered by municipal bonds as well as the inherent defensive
nature of municipal bonds.
Q
How did Hibernia Louisiana Municipal Income Fund perform on a total return and
income basis?
A
The fund turned in a modestly negative total return of (0.08%)* in the face of
dramatically rising taxable bond interest rates. The net asset value price
return of the fund was (5.41%)* for the 12-month reporting period and the income
return was 5.33%.
Q
What factors are shaping the direction of the municipal bond market as we enter
a historic year?
A
The municipal bond market will likely take its cue from the treasury bond market
in the coming months. Most important in influencing the direction of the fixed
income market will be Alan Greenspan, the Fed and the trend in reported
inflation and employment data.
*Performance quoted represents past performance and is not indicative of future
results. Investment return and principal will fluctuate, so that an investor's
shares, when redeemed, may be worth more or less than their original cost.
Total return quoted above is based on net asset value and does not reflect the
maximum sales charge. Total return based on the maximum sales charge for the
12-month reporting period is (3.04%).
Hibernia Louisiana Municipal Income Fund
Growth of $10,000 Invested in Hibernia Louisiana Municipal Income Fund
The graph below illustrates the hypothetical investment of $10,000 in the
Hibernia Louisiana Municipal Income Fund (the "Fund") from August 31, 1989 to
August 31, 1999, compared to the Lehman Ten Year Insured Index ("LTYII").+
[Chart goes here]
AVERAGE ANNUAL TOTAL RETURN** FOR THE
PERIOD ENDED AUGUST 31, 1999
1 Year...........................................................(3.04%)
5 Years...........................................................5.22%
10 Years..........................................................6.49%
Past performance is not predictive of future performance. Your investment return
and principal value will fluctuate so when shares are redeemed, they may be
worth more or less than original cost. Mutual funds are not obligations of or
guaranteed by any bank and are not federally insured.
+The LTYII is not adjusted to reflect sales loads, expenses, or other fees that
the SEC requires to be reflected in the Fund's performance. This index is
unmanaged.
*Represents a hypothetical investment of $10,000 in the Fund after deducting
the original maximum sales charge of 4.50% ($10,000 investment minus $450 sales
charge = $9,550), which was effective on October 14, 1988 (start of
performance). Effective October 31, 1993, the maximum sales charge has been
reduced to 3.00%. The Fund's performance assumes the reinvestment of all
dividends and distributions. The LTYII has been adjusted to reflect
reinvestment of dividends on securities in the index.
** Total returns reflect the current 3.00% sales charge.
Hibernia Mid Cap Equity Fund
Annual Report/12-month period from September 1, 1998 through August 31, 1999
Q
It was an extremely strong period for mid-cap stocks. What accounted for that
sector's performance?
A
The emergence of internet stocks and technology stocks in the mid cap sector
accounted for a great deal of performance.
Q
It was also a strong period for Hibernia Mid Cap Equity Fund. What were the
total returns over the 12-month period ended August 31, 1999?
A
Hibernia Mid Cap Equity Fund return for the 12 months ended August 31, 1999 was
39.43%* for Class A Shares and 38.87%* for Class B Shares.
Q
As we leave a very strong year for mid-cap stocks, what factors will determine
the direction of the mid-cap market?
A
The continued growth of the U.S. economy, and technology stocks in particular.
*Performance quoted represents past performance and is not indicative of future
results. Investment return and principal will fluctuate, so that an investor's
shares, when redeemed, may be worth more or less than their original cost. The
total return quoted above is based on net asset value and does not reflect the
maximum sales charge. The total return based on the maximum sales charge for
the 12-month reporting period is 33.22% for Class A Shares and 33.37% for Class
B Shares.
Hibernia Mid Cap Equity Fund--Class A Shares
Growth of $10,000 Invested in Hibernia Mid Cap Equity Fund--Class A Shares
The graph below illustrates the hypothetical investment of $10,000 in the
Hibernia Mid Cap Equity Fund--Class A Shares, (the "Fund") from August 31, 1989*
to August 31, 1999, compared to the Standard & Poor's 400 Mid Cap Index ("S&P
400").+
[Chart goes here]
AVERAGE ANNUAL TOTAL RETURN** FOR THE
PERIOD ENDED AUGUST 31, 1999
1 Year...........................................................33.22%
5 Years..........................................................19.66%
10 Years.........................................................14.30%
Past performance is not predictive of future performance. Your investment return
and principal value will fluctuate so when shares are redeemed, they may be
worth more or less than original cost. Mutual funds are not obligations of or
guaranteed by any bank and are not federally insured.
+ The S&P 400 is not adjusted to reflect sales loads, expenses, or other fees
that the SEC requires to be reflected in the Fund's performance. This index is
unmanaged.
* Hibernia Mid Cap Equity Fund, Class A Shares is the successor to a common
trust fund. The quoted performance data includes performance of the common
trust fund for the period from 8/31/89 to 7/12/98 when the Fund commenced
operation, as adjusted to reflect the Fund's anticipated expenses. The common
trust fund was not registered under the Investment Company Act of 1940 ("1940
Act") and therefore was not subject to certain investment restrictions imposed
by the 1940 Act. If the common trust fund had been registered under the 1940
Act, the performance may have been adversely affected.
**Represents a hypothetical investment of $10,000 in the Fund after deducting
the original maximum sales charge of 4.50% ($10,000 investment minus $450
sales charge = $9,550), which was effective on July 13, 1998. The Fund's
performance assumes the reinvestment of all dividends and distributions. The
S&P 400 has been adjusted to reflect reinvestment of dividends on securities
in the index.
***Total returns reflect the current 4.50% sales charge.
Hibernia Mid Cap Equity Fund--Class B Shares
Growth of $10,000 Invested in Hibernia Mid Cap Equity Fund--Class B Shares
The graph below illustrates the hypothetical investment of $10,000 in the
Hibernia Mid Cap Equity Fund--Class B Shares, (the "Fund") from July 13, 1998
(start of performance) to August 31, 1999, compared to the Standard & Poor's 400
Mid Cap Index ("S&P 400").+
[Chart goes here]
AVERAGE ANNUAL TOTAL RETURN** FOR THE
PERIOD ENDED AUGUST 31, 1999
1 Year...........................................................33.37%
Start of Performance (7/13/98)....................................7.35%
Past performance is not predictive of future performance. Your investment return
and principal value will fluctuate so when shares are redeemed, they may be
worth more or less than original cost. Mutual funds are not obligations of or
guaranteed by any bank and are not federally insured.
+ The S&P 400 is not adjusted to reflect sales loads, expenses, or other fees
that the SEC requires to be reflected in the Fund's performance. This index is
unmanaged.
* Represents a hypothetical investment of $10,000 in the Fund. The ending value
of the Fund reflects a 4.50% contingent deferred sales charge on any
redemption less than two years from the purchase date. The Fund's performance
assumes the reinvestment of all dividends and distributions. The S&P 400 has
been adjusted to reflect reinvestment of dividends on securities in the index.
**Total return quoted reflects all applicable contingent deferred sales
charges.
Hibernia Total Return Bond Fund
Annual Report/12-month period from September 1, 1998 through August 31, 1999
Q
What are your comments on the environment that produced flat returns for the
year for the bond market across the board?
A
The surprising strength in the domestic economy in conjunction with the upturn
in global economic activity has ignited inflation worries among investors and
the Fed. The Fed initiated a series of short term interest rate increases to
proactively slow the economy in an effort to prolong the current economic
expansion.
Q
While its total return was flat, how did the fund do in terms of its income
stream?
A
Hibernia Total Return Bond Fund shareholders experienced an income return of
5.71% for the fiscal year ended August 31, 1999.
Q
What factors will have the greatest influence on the bond market as we enter the
year 2000?
A
Looking ahead, the Fed with its fixation on inflation and employment data will
likely be the major factor moving the fixed income markets. The Fed will
continue to nudge interest rates higher until evidence of a moderating economy
surfaces.
Hibernia Total Return Bond Fund
Growth of $10,000 Invested in Hibernia Total Return Bond Fund
The graph below illustrates the hypothetical investment of $10,000 in the
Hibernia Total Return Bond Fund (the "Fund") from November 2, 1992 (start of
performance) to August 31, 1999, compared to the Salomon Brothers Broad
Investment Grade Bond Index ("SBBIGBI").+
[Chart goes here]
AVERAGE ANNUAL TOTAL RETURN** FOR THE
PERIOD ENDED AUGUST 31, 1999
1 Year...........................................................(3.05%)
5 Years...........................................................5.53%
Start of Performance (11/2/92)....................................5.18%
Past performance is not predictive of future performance. Your investment return
and principal value will fluctuate so when shares are redeemed, they may be
worth more or less than original cost. Mutual funds are not obligations of or
guaranteed by any bank and are not federally insured.
+ The SBBIGBI is not adjusted to reflect sales loads, expenses, or other fees
that the SEC requires to be reflected in the Fund's performance. This index is
unmanaged.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the original maximum sales charge of 4.50% ($10,000 investment minus $450
sales charge = $9,550), which was effective on November 2, 1992. Effective May
1, 1994, the maximum sales charge has been reduced to 3.00%. The Fund's
performance assumes the reinvestment of all dividends and distributions. The
SBBIGBI has been adjusted to reflect reinvestment of dividends on securities
in the index.
**Total returns reflect the current 3.00% sales charge.
Hibernia U.S. Government Income Fund
Annual Report/12-month period from September 1, 1998 through August 31, 1999
Q
What is your review of the continued weak environment for bond returns during
the fund's fiscal year?
A
Bond yields experienced a sharp reversal over the last 12 months, ending a long
period of falling yields. Concerns about the threat of rising inflation and
uncertainty about U.S. Federal Reserve Bank policy in the face of this inflation
threat, caused yields to back up almost 150 basis points over the reporting
period ending August 31, 1999.
Q
On a total return and income basis, how did Hibernia U.S. Government Income Fund
perform?
A
For the fiscal year, the fund had an income return of 5.43%, and a total return
of 0.41%*.
Q
Do the signs appear to point toward a more positive bond environment as we
approach the year 2000? How have you structured the fund's mix of
mortgage-backed securities, Treasuries and agencies?
A
While there is still some uncertainty about the short-term future direction of
Fed policy, inflation has not yet proven to be a real problem. The improvement
in productivity on a global basis, which has been driven by the technology
revolution, has helped to keep a lid on inflationary pressures in the face of
generations-low unemployment levels. This productivity boom should continue,
which should help bond prices recover and interest rates to decline.
*Performance quoted represents past performance and is not indicative of future
results. Investment return and principal will fluctuate, so that an investor's
shares, when redeemed, may be worth more or less than their original cost. The
total return quoted above is based on net asset value and does not reflect the
maximum sales charge. The total return based on the maximum sales charge for
the 12-month reporting period is (2.61%).
Hibernia U.S. Government Income Fund
Growth of $10,000 Invested in Hibernia U.S. Government Income Fund
The graph below illustrates the hypothetical investment of $10,000 in the
Hibernia U.S. Government Income Fund (the "Fund") from August 31, 1989 to August
31, 1999, compared to the Salomon Brothers Medium Term Broad Index ("SBMTBI").+
[Chart goes here]
AVERAGE ANNUAL TOTAL RETURN** FOR THE
PERIOD ENDED AUGUST 31, 1999
1 Year...........................................................(2.61%)
5 Years...........................................................5.65%
10 Years..........................................................6.57%
Past performance is not predictive of future performance. Your investment return
and principal value will fluctuate so when shares are redeemed, they may be
worth more or less than original cost. Mutual funds are not obligations of or
guaranteed by any bank and are not federally insured.
+ The SBMTBI is not adjusted to reflect sales loads, expenses, or other fees
that the SEC requires to be reflected in the Fund's performance. This index is
unmanaged.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the original maximum sales charge of 4.50% ($10,000 investment minus $450
sales charge = $9,550), which was effective on October 14, 1988 (start of
performance). Effective October 31, 1993, the maximum sales charge has been
reduced to 3.00%. The Fund's performance assumes the reinvestment of all
dividends and distributions. The SBMTBI has been adjusted to reflect
reinvestment of dividends on securities in the index.
**Total returns reflect the current 3.00% sales charge.
Hibernia Cash Reserve Fund
Annual Report/12-month period from September 1, 1998 through August 31, 1999
Q
What is your overview of the interest rate environment during the fund's fiscal
year, which saw the Federal Reserve Board reverse policy and go from a series of
interest rate "easings," or cuts, to "tightenings" or increases?
A
The Federal Reserve began fighting potentially higher inflation in the summer of
1999, raising the federal funds target rate twice for a total of 50 basis
points. This was in contrast to the begining of the fund's fiscal year which saw
the Fed lower the target three times for a total of 75 basis points.
Q
As a result, where did the 7-day net yield of Hibernia Cash Reserve Fund stand
at the beginning and end of the reporting period?
A
The yield on August 31, 1998 was 4.71% (A shares). On August 31, 1999 the yield
was 4.32% (A shares), and 3.55% (B shares).*
Q
What was your strategy in terms of the fund's portfolio mix and average maturity
during the period?
A
The portfolio has been broadly diversified across security types with a heavy
reliance on commercial paper. The average maturity typically has been
approximately 30 days.
Q
What factors will have the greatest impact on rates as we enter a new year?
A
Of course, Fed policy is first on everyone's mind. At the most recent FOMC
meeting, the announced bias was toward tightening.
*Performance quoted represents past performance and is not indicative of future
results. Yield will vary. Yields quoted for money market funds most closely
reflect the fund's current earnings.
Hibernia U.S. Treasury Money Market Fund
Annual Report/12-month period from September 1, 1998 through August 31, 1999
Q
What is your overview of the interest rate environment during the fund's fiscal
year, which saw the Fed reverse policy and go from a series of interest rate
"easings," or cuts, to "tightenings"or increases?
A
The Fed began fighting potentially higher inflation in the summer of 1999,
raising the fed funds target rate twice for a total of 50 basis points. This was
in contrast to the beginning of the fund's fiscal year which saw the Fed lower
the target three times for a total of 75 basis points.
Q
As a result, where did the 7-day net yield of Hibernia U.S. Treasury Money
Market Fund stand at the beginning and end of the reporting period?
A
The yield on August 31, 1998 was 4.78%. On August 31, 1999, the yield was
4.27%.*
Q
How have you structured the fund's portfolio in terms of holdings and average
maturity?
A
The fund, of course, invests solely in direct or indirect U.S. Treasury
securities, balanced between overnight investments to longer term ones. The
current average maturity is 25 days.
Q
What factors will have the greatest impact on rates as we enter a new year?
A
Of course, Fed policy is first on everyone's mind. At the most recent FOMC
meeting, the announced bias was toward tightening.
*Performance quoted represents past performance and is not indicative of future
results. Yield will vary. Yields quoted for money market funds most closely
reflect the fund's current earnings.
Portfolio of Investments
Hibernia Funds
August 31, 1999
CAPITAL APPRECIATION FUND
<TABLE>
<CAPTION>
Shares Value
COMMON STOCKS--98.3%
Commercial Services--2.3%
<C> <S> <C>
58,000 McGraw-Hill Cos., Inc. $ 2,997,875
15,500 Omnicom Group, Inc. 1,168,313
130,000 Sysco Corp. 4,241,250
Total 8,407,438
Consumer Durables--1.3%
57,430 Ford Motor Co. 2,993,539
27,600 Maytag Corp. 1,728,450
Total 4,721,989
Consumer Non-Durables--5.6%
26,800 Anheuser-Busch Cos., Inc. 2,063,600
78,800 Coca-Cola Co. 4,713,225
42,000 Kimberly-Clark Corp. 2,391,375
52,500 PepsiCo, Inc. 1,791,563
65,000 Philip Morris Cos., Inc. 2,433,438
50,000 Procter & Gamble Co. 4,962,500
28,000 Quaker Oats Co. 1,870,750
19,700 V.F. Corp. 709,200
Total 20,935,651
Consumer Services--4.2%
31,700 CBS Corp. 1,489,900
44,500 Hertz Corp., Class A 1,793,906
79,600 Time Warner, Inc. 4,721,275
71,000 (1) Tricon Global Restaurants, Inc. 2,884,375
115,200 (1) Viacom, Inc., Class B 4,845,600
Total 15,735,056
Electronic Technology--17.7%
78,300 (1) Applied Materials, Inc. 5,564,194
131,960 (1) Cisco Systems, Inc. 8,948,537
81,800 (1) EMC Corp. Mass 4,908,000
48,800 Hewlett-Packard Co. 5,142,300
111,600 Intel Corp. 9,172,125
81,400 International Business machines corp. 10,139,387
141,800 Lucent Technologies, Inc. 9,084,062
19,200 Motorola, Inc. 1,771,200
28,800 Texas Instruments, Inc. 2,363,400
94,400 (1) Unisys Corp. 4,059,200
66,200 United Technologies Corp. 4,377,475
Total 65,529,880
Energy Minerals--7.0%
23,200 Atlantic Richfield Co. 2,040,150
73,385 BP Amoco PLC, ADR 8,228,293
89,150 Exxon Corp. 7,031,706
37,800 Mobil Corp. 3,869,775
38,700 Royal Dutch Petroleum Co., ADR 2,394,563
18,600 Texaco, Inc. 1,181,100
44,800 USX Corp. 1,394,400
Total 26,139,987
Finance--12.9%
65,500 Allstate Corp. 2,149,219
58,200 AMBAC 3,073,687
76,100 Chase Manhattan Corp. 6,368,619
184,125 Citigroup, Inc. 8,182,055
55,400 Equitable Cos., Inc. 3,420,950
151,650 Fleet Financial Group, Inc. 6,037,566
39,500 Lehman Brothers Holdings, Inc. 2,123,125
31,000 Marsh & McLennan Cos., Inc. 2,257,187
54,600 Morgan, J.P. & Co., Inc. 7,053,638
7,400 Morgan Stanley, Dean Witter & Co. 635,013
60,000 Providian Financial Corp. 4,657,500
47,500 Wells Fargo Co. 1,891,094
Total 47,849,653
Health Technology--10.6%
89,400 Abbott Laboratories 3,877,725
78,400 (1) Amgen, Inc. 6,521,900
72,000 (1) Biogen, Inc. 5,526,000
44,500 Bristol-Myers Squibb Co. 3,131,687
45,600 Johnson & Johnson 4,662,600
39,200 Merck & Co., Inc. 2,633,750
113,400 Pfizer, Inc. 4,280,850
163,800 Schering Plough Corp. 8,609,738
Total 39,244,250
Industrial Services--0.7%
40,700 Schlumberger Ltd. 2,716,725
Non-Energy Minerals--1.1%
66,000 Alcoa, Inc. 4,261,125
Process Industries--2.7%
59,775 Ball Corp. 2,686,139
22,900 Dow Chemical Co. 2,602,012
149,200 Solutia, Inc. 2,984,000
20,000 Textron, Inc. 1,615,000
Total 9,887,151
Producer Manufacturing--7.0%
24,200 Avery Dennison Corp. 1,327,975
15,700 Emerson Electric Co. 983,212
127,300 General Electric Co. 14,297,381
52,900 Ingersoll-Rand Co. 3,365,762
59,800 Tyco International Ltd. 6,058,488
Total 26,032,818
Retail Trade--5.8%
80,600 (1) Federated Department Stores, Inc. 3,707,600
29,062 Gap (The), Inc. 1,137,051
69,550 (1) Safeway, Inc. 3,238,422
203,600 TJX Cos., Inc. 5,878,950
173,400 Wal-Mart Stores, Inc. 7,683,788
Total 21,645,811
Technology Services--8.1%
59,300 Adobe System, Inc. 5,907,762
33,200 (1) America Online, Inc. 3,031,575
30,400 General Motors Corp. 2,010,200
206,200 (1) Microsoft Corp. 19,086,388
Total 30,035,925
Transportation--0.8%
14,100 (1) UAL Corp. 913,856
43,000 Union Pacific Corp. 2,093,563
Total 3,007,419
<CAPTION>
Shares or Principal Amount Value
Utilities--10.5%
118,200 AT&T Corp. $ 5,319,000
47,500 Ameritech Corp. 2,998,437
67,600 Bell Atlantic Corp. 4,140,500
139,000 BellSouth Corp. 6,289,750
44,000 Coastal Corp. 1,905,750
65,800 DTE Energy Co. 2,594,987
179,700 Edison International 4,559,887
79,700 GTE Corp. 5,469,412
116,800 SBC Communications, Inc. 5,606,400
Total 38,884,123
TOTAL COMMON STOCKS (identified cost 365,035,001
$231,048,262)
(2) REPURCHASE AGREEMENT--1.8%
$ 6,712,000 State Street Corp., 5.36%, dated 8/31/1999, 6,712,000
due 9/1/1999 (at amortized cost)
TOTAL INVESTMENTS (identified cost $ 371,747,001
$237,760,262)
</TABLE>
LOUISIANA MUNICIPAL INCOME FUND
<TABLE>
<CAPTION>
Principal
Amount Credit
Rating(4) Value
<C> <S> <C> <C>
LONG-TERM MUNICIPALS--99.9%
Colorado--0.5%
$ 445,000 Colorado Health Facilities AAA $ 490,083
Authority, Revenue Bonds, 7.125%
(Rose Medical Center Project),
9/1/2008
Florida--0.9%
655,000 Florida State Board of Education AAA 663,469
Administration, GO UT Refunding
Bonds, 6.10%, 6/1/2000
145,000 Florida State Board of Education AA+ 146,734
Administration, GO UT Refunding
Bonds, 6.10%, 6/1/2000
Total 810,203
Louisiana97.8%
500,000 Alexandria, LA Utilities Revenue, AAA 504,640
Revenue Bonds, 5.25% (FGIC
INS)/(Original Issue Yield: 5.70%),
5/1/2010
1,000,000 Baton Rouge, LA, Revenue Refunding AAA 1,001,120
Bonds, 5.00% (FGIC INS), 8/1/2009
1,000,000 Bossier City, LA, Revenue Bonds, AAA 923,800
5.00% (FGIC INS), 12/1/2019
500,000 Bossier City, LA, Revenue Refunding AAA 487,725
Bonds, 5.20% (FGIC INS)/(Original
Issue Yield: 5.35%), 11/1/2014
1,500,000 East Baton Rouge Parish, LA, AAA 1,462,200
Revenue Refunding Bonds, 5.40%
(FGIC INS)/(Original Issue Yield:
5.85%), 2/1/2018
1,250,000 East Baton Rouge Parish, LA, AAA 1,281,912
Revenue Refunding Bonds, (Series
ST), 5.90% (FGIC INS), 2/1/2017
930,000 East Baton Rouge Parish, LA, Sales AAA 887,676
& Use Tax Revenue Bonds (Series
ST-A), 4.80% (FGIC INS)/(Original
Issue Yield: 5.15%), 2/1/2011
500,000 East Baton Rouge Parish, LA, Sales AAA 477,430
and Use Tax Revenue Bonds (Series
ST), 5.20% (FSA INS)/ (Original
Issue Yield: 5.65%), 2/1/2017
170,000 East Baton Rouge, LA Mortgage Aaa 174,974
Finance Authority, Revenue Bonds,
7.625% (GNMA COL), 8/1/2008
290,000 East Baton Rouge, LA Mortgage Aaa 290,183
Finance Authority, Revenue
Refunding Bonds, 4.80% (GNMA COL),
10/1/2004
465,000 East Baton Rouge, LA Mortgage Aaa 442,522
Finance Authority, SFM Purchasing
Revenue Bonds (Series B), 5.40%
(FNMA COL), 10/1/2025
1,315,000 East Baton Rouge, LA Mortgage Aaa 1,355,594
Finance Authority, SFM Revenue
Refunding Bonds (Series B), 7.40%
(GNMA COL), 8/1/2012
350,000 East Baton Rouge, LA Mortgage Aaa 362,687
Finance Authority, SFM Revenue
Refunding Bonds (Series C), 7.00%,
4/1/2032
1,000,000 Ernest N Morial-New Orleans, LA AAA 992,390
Exhibit Hall Authority, Special Tax
Refunding Bonds (Series C), 5.50%
(MBIA INS)/(Original Issue Yield:
5.58%), 7/15/2018
1,200,000 Ernest N Morial-New Orleans, LA AAA 1,182,972
Exhibit Hall Authority, Special Tax
Refunding Bonds (Series C), 5.60%
(MBIA INS)/(Original Issue Yield:
5.65%), 7/15/2025
1,450,000 Greater New Orleans Expressway AAA 1,505,506
Commission, LA, Revenue Refunding
Bonds, 6.00% (Louisiana
Expresssway)/(MBIA INS)/(Original
Issue Yield: 6.55%), 11/1/2016
1,000,000 Jefferson Parish LA Hospital AAA 1,003,590
Service District No. 2, Revenue
Refunding Bonds, 5.75% (MBIA INS)/
(Original Issue Yield: 6.05%),
7/1/2016
2,000,000 Jefferson Parish, LA Home Mortgage AAA 2,048,960
Authority, Revenue Refunding Bonds
(Series A), 6.15% (FNMA and GNMA
COLs), 6/1/2028
500,000 Jefferson Parish, LA Home Mortgage AAA 496,485
Authority, Revenue Bonds, 5.85%
(FNMA and GNMA LOCs), 12/1/2028
1,000,000 Jefferson Parish, LA School Board, AAA 577,970
GO UT Bonds, 5.10% accrual (FSA
INS)/(Original Issue Yield: 5.10%),
3/1/2010
200,000 Jefferson Parish, LA School Board, AAA 201,152
Revenue Bonds, 5.00% (AMBAC INS),
2/1/2008
145,000 Jefferson, LA Housing Development AAA 152,380
Corp., Multifamily Revenue
Refunding Bonds (Series A), 7.375%
(Concordia Project)/ (FNMA COL)/
(Original Issue Yield: 7.544%),
8/1/2005
1,000,000 Lafayette Parish, LA School Board, AAA 899,990
Revenue Bonds, 4.60% (FGIC INS),
4/1/2014
1,000,000 Lafayette Parish, LA School Board, AAA 868,150
Revenue Bonds, 4.60% (FGIC INS),
4/1/2018
500,000 Lafayette Parish, LA School Board, AAA 436,635
Revenue Bonds, 4.60% (FGIC
INS)/(Original Issue Yield: 5.05%),
4/1/2017
500,000 Lafayette, LA Public Power AAA 506,730
Authority, Revenue Refunding Bonds,
5.50% (AMBAC INS), 11/1/2010
500,000 Lafayette, LA Public Power AAA 504,675
Authority, Revenue Refunding Bonds,
5.50% (AMBAC INS), 11/1/2011
260,000 Lafayette, LA Public Power AAA 262,335
Authority, Revenue Refunding Bonds,
5.50% (AMBAC INS), 11/1/2012
250,000 Lafayette, LA, Public Improvement AAA 255,765
Sales Tax Revenue Bonds, 5.50%
(FGIC INS)/(Original Issue Yield:
5.60%), 3/1/2009
1,650,000 Louisiana HFA, Multifamily Housing Aaa 1,689,633
Revenue Refunding Bonds (Series A),
6.10% (Woodward Wright Apartments
Project)/ (GNMA COL), 12/20/2018
350,000 Louisiana HFA, Multifamily Housing Aaa 359,604
Revenue Refunding Bonds, 5.85%
(Woodward Wright Apartments
Project)/ (GNMA COL), 12/20/2008
1,000,000 Louisiana HFA, Multifamily Housing Aaa 1,023,940
Revenue Refunding Bonds, 6.20%
(Woodward Wright Apartments
Project)/ (GNMA COL), 6/20/2028
1,000,000 Louisiana HFA, Revenue Bond, 7.10% AAA 1,057,270
(Villa Maria Retirement
Center)/(GNMA COL), 1/20/2035
435,000 Louisiana HFA, SFM Revenue Bonds Aaa 451,239
(Series A-2), 6.55%, 12/1/2026
500,000 Louisiana PFA, Hospital Revenue AAA 518,675
Bonds, 5.70% (Woman's Hospital
Foundation)/(FGIC INS)/(Original
Issue Yield: 5.80%), 10/1/2008
500,000 Louisiana PFA, Hospital Revenue AAA 538,920
Refunding Bonds, 6.40% (Lafayette
General Medical Center
Project)/(FSA INS)/ (Original Issue
Yield: 6.53%), 10/1/2012
2,045,000 Louisiana PFA, Multifamily Housing AAA 2,172,035
Revenue Bonds (Series A), 7.50%
(Federal Home Loan Mortgage Corp.
COL), 6/1/2021
800,000 Louisiana PFA, Refunding Revenue AAA 713,896
Bonds, 5.00% (AMBAC INS)/(Original
Issue Yield: 5.30%), 2/1/2028
500,000 Louisiana PFA, Refunding Revenue AAA 514,435
Bonds, 5.75% (Alton Ochsner Medical
Foundation)/(MBIA INS)/(Original
Issue Yield: 6.636%), 5/15/2011
1,000,000 Louisiana PFA, Revenue Bond, 5.25% AAA 934,110
(Xavier University of LA
Project)/(MBIA INS), 9/1/2027
750,000 Louisiana PFA, Revenue Bond, 6.00% AAA 785,280
(General Health, Inc.)/(MBIA
INS)/(Original Issue Yield: 6.15%),
11/1/2012
500,000 Louisiana PFA, Revenue Bonds, 5.10% AAA 460,955
(Tulane University, LA)/(MBIA
INS)/(Original Issue Yield: 5.27%),
11/15/2021
1,890,000 Louisiana PFA, Revenue Refunding AAA 1,978,565
Bonds (Series A), 6.75% (Bethany
Home Project)/(FHA LOC), 8/1/2025
350,000 Louisiana PFA, Revenue Refunding AAA 370,548
Bonds (Series B), 6.50% (Alton
Ochsner Medical Foundation)/(MBIA
INS)/(Original Issue Yield:
6.743%), 5/15/2022
1,000,000 Louisiana PFA, Revenue Refunding NR 999,850
Bonds, 5.45% (AMBAC INS)/ (Original
Issue Yield: 5.45%), 2/1/2013
830,000 Louisiana PFA, Revenue Refunding NR 848,218
Bonds, 6.20% (Guaranteed Student
Loans GTD), 3/1/2001
385,000 Louisiana PFA, Student Loan NR 404,196
Refunding Revenue Bonds (Series
A-2), 6.75% (Student Loans GTD),
9/1/2006
260,000 Louisiana PFA, Student Opportunity AAA 274,503
Loans Revenue Bonds (Series A),
6.80% (FSA INS), 1/1/2006
255,000 Louisiana PFA, Student Opportunity AAA 269,326
Loans Revenue Bonds (Series A),
6.85% (FSA INS COL), 1/1/2009
215,000 Louisiana Public Facilities AAA 203,841
Authority Hospital Revenue, Revenue
Refunding Bonds, 5.00% (Louisiana
Health System Coporate
Project)/(FSA INS LOC)/(Original
Issue Yield: 5.10%), 10/1/2013
1,000,000 Louisiana Public Facilities AAA 909,110
Authority Hospital Revenue, Revenue
Bond, 5.00% (Franciscan
Missionaries of Our Lady Health
System)/ (MBIA INS)/(Original Issue
Yield: 5.00%), 7/1/2019
3,000,000 Louisiana Stadium and Expo AAA 2,684,550
District, (Series B) Refunding
Revenue Bonds, 5.00% (FGIC
INS)/(Original Issue Yield: 5.09%),
7/1/2026
500,000 Louisiana Stadium and Expo AAA 539,940
District, Hotel Occupancy Tax and
Stadium Revenue Refunding Bonds
(Series A), 6.00% (FGIC INS),
7/1/2016
2,155,000 Louisiana Stadium and Expo AAA 2,331,064
District, Hotel Occupancy Tax and
Revenue Refunding Bonds (Series A),
6.00% (FGIC INS)/(Original Issue
Yield: 6.10%), 7/1/2024
3,500,000 Louisiana Stadium and Expo AAA 3,766,595
District, Revenue Bonds, 5.75%
(FGIC INS)/(Original Issue Yield:
5.85%), 7/1/2026
3,500,000 Louisiana State Office Facilities, AAA 3,389,120
Revenue Bonds, 5.375% (MBIA
INS)/(Original Issue Yield: 5.43%),
3/1/2019
5,000,000 Louisiana State University and AAA 4,859,600
Agricultural and Mechanical
College, Revenue Bonds, 5.50% (MBIA
INS)/(Original Issue Yield: 5.80%),
7/1/2026
1,565,000 Louisiana State University and AAA 1,584,688
Agricultural and Mechanical
College, Revenue Bonds, 5.75% (FGIC
INS)/(Original Issue Yield:
6.043%), 7/1/2014
1,250,000 Louisiana State University and 1,109,138
Agricultural and Mechanical
College, University & College
Improvement Revenue Refunding
Bonds, 5.00% (University of New
Orleans Project)/ (AMBAC INS),
10/1/2030
1,000,000 Louisiana State, GO UT Bonds AAA 926,200
(Series B), 5.00% (FSA
INS)/(Original Issue Yield: 5.17%),
4/15/2018
250,000 Monroe, LA School District, Special AAA 253,983
School District, GO UT Bonds, 5.35%
(FGIC INS)/ (Original Issue Yield:
5.75%), 3/1/2009
525,000 Monroe-Brentwood, LA Housing Aaa 534,875
Development Corp., Multifamily
Housing Mortgage Revenue Refunding
Bonds, 6.50% (FNMA COL), 2/1/2010
1,020,000 Monroe-Brentwood, LA Housing Aaa 1,035,994
Development Corp., Multifamily
Housing Mortgage Revenue Refunding
Bonds, 6.70% (FNMA COL), 8/1/2021
2,000,000 New Orleans, LA Audubon Park, GO LT AAA 2,081,900
Bonds, 6.00% (FGIC INS)/(Original
Issue Yield: 6.25%), 10/1/2013
1,250,000 New Orleans, LA Home Mortgage NR 1,294,550
Authority, SFM Revenue Bonds
(Series A), 6.65% (GNMA COL),
9/1/2008
100,000 New Orleans, LA Home Mortgage Aaa 98,371
Authority, SFM Revenue Bonds, 5.35%
(FNMA and GNMA COLs), 12/1/2020
1,000,000 New Orleans, LA Home Mortgage AAA 1,091,920
Authority, Special Obligation
Revenue Bonds, 6.25% (United States
Treasury COL)/(Original Issue
Yield: 6.517%), 1/15/2011
205,000 New Orleans, LA Housing Development AAA 216,068
Corp., Multifamily Housing Revenue
Refunding Bonds, 7.375% (FNMA COL)/
(Original Issue Yield: 7.544%),
8/1/2005
730,000 New Orleans, LA Housing Development AAA 766,274
Corp., Multifamily Housing Revenue
Bonds, 7.375% (Southwood Patio FNMA
COL)/(Original Issue Yield:
7.544%), 8/1/2005
1,900,000 New Orleans, LA, GO Refunding Bond, AAA 1,963,004
6.20% (AMBAC INS)/ (Original Issue
Yield: 6.30%), 10/1/2021
4,750,000 New Orleans, LA, GO UT Capital AAA 2,207,230
Appreciation Bonds (AMBAC INS)/
(Original Issue Yield: 7.10%),
9/1/2013
980,000 New Orleans, LA, GO UT Refunding AAA 1,029,382
Bonds, 5.875% (AMBAC INS)/
(Original Issue Yield: 6.00%),
10/1/2011
6,000 New Orleans, LA, GO UT Refunding AAA 6,406
Bonds, 7.30% (AMBAC INS)/ (Original
Issue Yield: 7.35%), 12/1/2001
2,000,000 New Orleans, LA, Revenue Refunding AAA 1,927,560
Bonds (Series B), 5.00% (FSA
INS)/(Original Issue Yield: 5.10%),
12/1/2012
500,000 Orleans Parish, LA Parishwide Aaa 462,500
School District, GO UT, 5.125%
(MBIA INS)/(Original Issue Yield:
5.35%), 9/1/2021
1,000,000 Orleans, LA Levee District, Revenue AAA 1,036,810
Refunding Bonds (Series A), 5.95%
(FSA INS)/(Original Issue Yield:
6.039%), 11/1/2014
2,500,000 Rapides Parish, LA Industrial AAA 2,496,500
Development, Revenue Refunding
Bonds, 5.875% (AMBAC INS)/
(Original Issue Yield: 5.95%),
9/1/2029
1,000,000 Shreveport, LA, GO UT Public AAA 935,200
Improvement Bonds, 5.00%, 3/1/2017
750,000 Shreveport, LA, Revenue Bonds AAA 700,432
(Series A), 5.375% (FSA INS),
1/1/2028
500,000 Shreveport, LA, Revenue Bonds AAA 470,265
(Series B), 5.375% (FSA INS),
1/1/2024
750,000 Shreveport, LA, Water & Sewer, AAA 785,258
Revenue Bonds (Series A), 5.95%
(FGIC INS), 12/1/2014
535,000 St. Charles Parish School Board, AAA 477,199
School Improvement Revenue Bonds,
4.75% (AMBAC INS), 2/1/2018
1,485,000 St. Charles Parish, LA Consolidated AAA 1,583,203
Waterworks and Wastewater District
No. 1, Utility Revenue Refunding
Bonds, 7.15% (MBIA INS), 7/1/2016
1,000,000 St. Charles Parish, LA Public AAA 1,015,640
Improvement, UT GO Refunding Bonds
(Series ST-96), 5.25% (MBIA INS)/
(Original Issue Yield: 5.45%),
12/1/2009
500,000 St. Charles Parish, LA, AAA 498,355
Environmental Improvement Revenue
Bonds, 5.95% (LA Power & Light
Co.)/ (FSA INS)/(Original Issue
Yield: 5.986%), 12/1/2023
1,000,000 St. Charles Parish, LA, Solid Waste AAA 1,080,790
Disposal Revenue Bonds, 7.00% (LA
Power & Light Co.)/(AMBAC INS)/
(Original Issue Yield: 7.04%),
12/1/2022
1,000,000 St. James Parish, LA, GO UT, 5.50% AAA 1,006,130
(AMBAC INS), 3/1/2012
400,000 St. Tammany Parish, LA Hospital AAA 422,760
Service District No. 2, Hospital
Revenue Refunding Bonds, 6.125%
(Connie Lee LOC)/(Original Issue
Yield: 6.315%), 10/1/2011
1,000,000 St. Tammany Parish, LA Hospital AAA 1,067,980
Service District No. 2, Revenue
Bonds, 6.25% (Connie Lee
LOC)/(Original Issue Yield: 6.40%),
10/1/2014
<CAPTION>
Principal
Amount Credit
or Shares Rating(4) Value
$ 500,000 St. Tammany Parish, LA Wide School AAA $ 498,575
District No. 12, GO UT Bonds,
5.375% (FSA INS), 3/1/2013
500,000 State Colleges & Universities, LA, AAA 496,235
Revenue Bonds, 5.65% (University of
Southwestern, LA)/ (MBIA INS),
9/1/2026
1,000,000 University of Louisiana, Revenue AAA 914,350
Bonds, 5.10% (AMBAC INS)/ (Original
Issue Yield: 5.20%), 4/1/2024
Total 90,672,891
Puerto Rico--0.7%
600,000 Puerto Rico Municipal Finance AAA 631,596
Agency, Revenue Bonds (Series A),
6.00% (FSA INS)/ (Original Issue
Yield: 6.30%), 7/1/2014
TOTAL LONG-TERM MUNICIPALS (3) 92,604,773
(identified cost $91,183,833)
MUTUAL FUND--3.5%
3,233,908 Federated Tax-Free Obligations Fund 3,233,908
(at net asset value)
TOTAL INVESTMENTS (identified cost $ 95,838,681
$94,417,741)
</TABLE>
MID CAP EQUITY FUND
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS--90.9%
Commercial Services--3.5%
9,100 (1) ACNielsen Corp. $ 227,500
1,750 Cintas Corp. 89,906
1,000 McGraw-Hill Cos., Inc. 51,688
6,000 Paychex, Inc. 176,625
7,590 (1) U.S. Foodservice, Inc. 157,967
Total 703,686
Consumer Durables--2.5%
3,600 Centex Corp. 101,250
4,750 Harley Davidson, Inc. 258,875
2,500 Maytag Corp. 156,563
Total 516,688
Consumer Non-Durables--4.0%
980 Church and Dwight, Inc. 45,570
1,100 Coors Adolph Co., Class B 62,769
3,625 Dial Corp. 100,594
4,740 Hormel Foods Corp. 190,785
4,360 IBP, Inc. 100,007
7,070 (1) Jones Apparel Group, Inc. 183,378
2,475 (1) Ralcorp Holdings, Inc. 40,528
2,520 (1) Tommy Hilfiger Corp. 85,522
Total 809,153
Consumer Services--2.6%
785 (1) Cox Communications, Inc., Class A 29,207
2,700 (1) Papa Johns International, Inc. 107,325
2,100 Pixar, Inc. 71,531
10,780 Ruby Tuesday, Inc. 195,388
3,000 (1) Scholastic Corp. 118,875
Total 522,326
Electronic Technology--17.3%
5,400 (1) Altera Corp. 227,475
1,725 (1) Comverse Technology, Inc. 134,550
10,440 Dell Computer Corp. 509,602
5,700 (1) Jabil Circuit, Inc. 255,431
2,600 (1) Lattice Semiconductor Corp. 160,225
6,400 Linear Technology Corp. 402,800
2,100 (1) Litton Industries, Inc. 134,400
2,600 (1) Qualcomm, Inc. 499,688
3,180 Rockwell International Corp. 188,018
3,300 Symbol Technologies, Inc. 114,881
2,455 United Technologies Corp. 162,337
10,200 (1) Xilinx, Inc. 713,363
Total 3,502,770
Energy Minerals--0.9%
2,300 Ashland, Inc. 88,694
1,800 Tosco Corp. 45,900
2,350 Valero Energy Corp. 49,938
Total 184,532
Finance--11.4%
3,100 Aflac, Inc. 139,306
1,270 AMBAC 67,072
3,157 American International Group,Inc. 292,614
12,663 Amsouth Bancorporation 277,003
1,425 City National Corp. 47,292
8,700 Dime Bancorp, Inc. 159,862
5,600 E*Trade Group, Inc. 140,000
3,125 Finova Group, Inc. 118,750
8,200 First Tennessee National Corp. 262,400
6,200 North Fork Bancorp, Inc. 112,375
8,379 Old Kent Financial Corp. 330,971
1,875 Old Republic International Corp. 29,063
5,100 PaineWebber Group, Inc. 200,175
2,300 Ryder Systems, Inc. 50,744
1,695 XL Capital Ltd., Class A 85,280
Total 2,312,907
Health Services--2.4%
2,125 Bergen Brunswig Corp., Class A 32,805
3,486 Cardinal Health, Inc. 222,232
3,700 (1) PacifiCare Health Systems, Inc. 222,000
Total 477,037
Health Technology--7.4%
3,885 Allergan, Inc. 388,014
10,760 Biogen, Inc. 825,830
2,500 (1) Elan Corp. Plc, ADR 80,156
1,600 (1) Genzyme Corp. 90,300
3,360 (1) Watson Pharmaceuticals, Inc. 120,540
Total 1,504,840
Industrial Services--0.8%
1,300 BJ Services Co. 44,525
3,720 Transocean Offshore, Inc. 126,480
Total 171,005
Non-Energy Minerals--1.3%
1,600 Cleveland Cliffs, Inc. 51,300
1,250 U.S.G. Corp. 61,250
3,480 Vulcan Materials Co. 148,335
Total 260,885
Process Industries--3.2%
3,300 Air Products & Chemicals, Inc. 112,200
6,490 Albemarle Corp. 112,358
3,300 Ball Corp. 148,294
4,995 Cabot Corp. 115,197
2,930 Fort James Corp. 94,492
3,150 Solutia, Inc. 63,000
Total 645,541
Producer Manufacturing--6.9%
10,320 American Power Conversion Corp. 181,245
3,500 Arvin Industries, Inc. 125,125
3,450 Cummins Engine Co., Inc. 204,412
2,500 Danaher Corp. 146,875
2,100 Ingersoll-Rand Co. 133,612
6,450 Lexmark Intl. Group, Class A 507,937
3,360 Trinity Industries, Inc. 105,420
Total 1,404,626
Retail Trade--7.3%
2,750 Abercrombie & Fitch Co., Class A 95,906
3,980 (1) Bed Bath & Beyond, Inc. 109,450
8,100 Best Buy Co., Inc. 569,025
950 Claire's Stores, Inc. 17,872
3,037 Gap (The), Inc. 118,823
4,500 Ross Stores, Inc. 187,313
1,000 (1) Safeway, Inc. 46,563
6,460 Tiffany & Co. 341,573
Total 1,486,525
<CAPTION>
Shares or
Principal
Amount Value
Technology Services--6.1%
3,400 Adobe System, Inc. $ 338,725
6,140 (1) Citrix Systems, Inc. 349,980
10,350 Rational Software Corp. 280,097
4,000 (1) Siebel Systems, Inc. 274,750
Total 1,243,552
Transportation--1.5%
2,800 CNF Transportation, Inc. 109,025
1,130 (1) UAL Corp. 73,238
2,300 USFreightways Corp. 111,550
Total 293,813
Utilities--11.8%
4,950 BEC Energy 213,778
3,634 Bell Atlantic Corp. 222,582
7,390 CenturyTel, Inc. 290,519
3,500 Coastal Corp. 151,594
7,160 Conectiv, Inc. 153,492
3,350 DQE, Inc. 129,603
15,700 Energy East Corp. 392,500
10,710 Montana Power Co. 331,341
3,330 New England Electric System 173,784
7,050 NiSource, Inc. 167,438
8,970 Questar Corp. 169,309
Total 2,395,940
TOTAL COMMON STOCKS (identified cost 18,435,826
$15,070,613)
(2) REPURCHASE AGREEMENT--9.9%
$ 2,008,000 State Street Corp., 5.36%, dated 8/31/1999, due 2,008,000
9/1/1999 (at amortized cost)
TOTAL INVESTMENTS (identified cost $17,078,613) $ 20,443,826
</TABLE>
TOTAL RETURN BOND FUND
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
CORPORATE BONDS/ASSET BACKED
SECURITIES--30.9%
Automobile--1.3%
$ 1,000,000 Ford Capital BV, Deb., 10.125%, 11/15/2000 $ 1,042,840
Banking--1.8%
1,500,000 Swiss Bank Corp. New York, Sub. Note, 7.25%, 1,482,840
9/1/2006
Consumer Durables--2.5%
2,000,000 Ford Motor Co., Note, 7.25%, 10/1/2008 1,996,400
Consumer Non-Durables--1.8%
1,500,000 Nabisco, Inc., Note, 6.375%, 2/1/2035 1,416,720
Electronic Technology--0.6%
500,000 International Business Machines Corp., Sr. 472,745
Note, 5.25%, 12/1/2003
Energy Minerals--1.8%
1,500,000 Enron Corp., Note, 6.40%, 7/15/2006 1,409,040
Finance--6.1%
1,250,000 American Express Co., Sr. Unsub., 6.75%, 1,237,712
6/23/2004
750,000 American General Finance Corp., Note, 8.00%, 756,292
2/15/2000
1,000,000 Bank America Corp., Sub. Note, 7.50%, 1,019,560
10/15/2002
1,000,000 General Electric Capital Corp., Medium Term 994,750
Note, Series A, 6.15%, 11/5/2001
1,000,000 Lehman Brothers, Inc., Bond, 6.50%, 4/15/2008 927,470
Total 4,935,784
Finance-Insurance--2.5%
2,000,000 Old Republic International Corp., Deb., 1,963,000
7.00%, 6/15/2007
Process Industries--2.4%
1,000,000 Du Pont (E.I.) de Nemours & Co., Note, 996,800
6.50%, 9/1/2002
1,000,000 Lubrizol Corp., 5.875%, 12/1/2008 909,350
Total 1,906,150
Retail Trade--6.3%
3,000,000 Dayton-Hudson Corp., Note, 7.50%, 7/15/2006 3,037,530
2,000,000 Wal-Mart Stores, Inc., Unsecd. Note, 6.55%, 1,996,780
8/10/2004
Total 5,034,310
Technology Services--1.1%
1,000,000 First Data Corp., Note, 5.80%, 12/15/2008 902,820
Utilities--2.7%
2,000,000 K N Energy, Inc., Deb., 9.625%, 8/1/2021 2,165,000
TOTAL CORPORATE BONDS/ ASSET BACKED 24,727,649
SECURITIES (identified cost $25,367,458)
GOVERNMENT AGENCIES--17.7%
Federal Home Loan Bank--0.7%
550,000 7.01%, 6/14/2006 560,268
(5) Federal National Mortgage
Association--0.0%
1,028 Pool 1804, 11.00%, 4/1/2011 1,108
2,325 Pool 34138, 11.00%, 4/1/2010 2,563
4,279 Pool 76204, 11.00%, 6/1/2019 4,805
8,859 Pool 85131, 11.00%, 5/1/2017 9,947
Total 18,423
(5) Government National Mortgage Association
15-Year--0.7%
569,596 Pool 420153, 7.00%, 9/15/2010 566,036
(5) Government National Mortgage Association
30-Year--16.3%
22,322 Pool 147875, 10.00%, 3/15/2016 24,428
109,038 Pool 168511, 8.00%, 7/15/2016 111,627
85,263 Pool 174673, 8.00%, 8/15/2016 87,288
33,371 Pool 177145, 8.00%, 1/15/2017 34,164
5,467 Pool 188080, 8.00%, 9/15/2018 5,590
68,938 Pool 212047, 8.00%, 5/15/2017 70,575
59,688 Pool 212660, 8.00%, 4/15/2017 61,106
119,471 Pool 216950, 8.00%, 6/15/2017 122,308
86,804 Pool 217533, 8.00%, 5/15/2017 88,866
31,120 Pool 225725, 10.00%, 9/15/2020 34,077
65,229 Pool 227430, 9.00%, 8/15/2019 68,919
42,253 Pool 253449, 10.00%, 10/15/2018 46,241
45,438 Pool 279619, 10.00%, 9/15/2019 49,727
30,181 Pool 279629, 9.00%, 10/15/2019 31,888
40,128 Pool 283261, 9.00%, 11/15/2019 42,398
97,341 Pool 287853, 9.00%, 4/15/2020 102,725
15,821 Pool 288052, 10.00%, 7/15/2020 17,324
7,462 Pool 288570, 10.00%, 8/15/2020 8,171
18,029 Pool 288967, 9.00%, 4/15/2020 19,048
65,203 Pool 288994, 9.00%, 5/15/2020 68,809
30,745 Pool 289082, 9.00%, 4/15/2020 32,484
36,630 Pool 291100, 9.00%, 5/15/2020 38,702
43,629 Pool 292364, 10.00%, 9/15/2020 47,747
14,845 Pool 296315, 10.00%, 9/15/2020 16,246
320,633 Pool 302101, 7.00%, 6/15/2024 311,716
316,398 Pool 345031, 7.00%, 10/15/2023 307,796
352,062 Pool 345090, 7.00%, 11/15/2023 342,489
170,675 Pool 360772, 7.00%, 2/15/2024 166,248
352,473 Pool 382074, 7.00%, 9/15/2025 342,008
112,949 Pool 404653, 7.00%, 9/15/2025 109,596
334,688 Pool 408884, 7.00%, 9/15/2025 324,751
490,474 Pool 410108, 7.00%, 9/15/2025 475,912
255,651 Pool 410786, 7.00%, 9/15/2025 248,060
525,404 Pool 415427, 7.50%, 8/15/2025 520,969
374,940 Pool 415865, 7.00%, 9/15/2025 363,808
1,008,554 Pool 418781, 7.00%, 9/15/2025 978,610
1,061,827 Pool 420157, 7.00%, 10/15/2025 1,030,302
2,337,567 Pool 453534, 7.50%, 10/15/2038 2,313,327
4,050,292 Pool 780717, 7.00%, 2/15/2028 3,938,909
Total 13,004,959
TOTAL GOVERNMENT AGENCIES (identified cost 14,149,686
$14,462,519)
(3) LONG-TERM MUNICIPALS--6.5%
1,175,000 Liberal, KS, GO UT (Series 2), 6.50% Bonds 1,105,252
(FSA INS), 12/1/2010
2,000,000 New Orleans, LA Aviation Board, Revenue 1,913,240
Bonds, 7.10% Bonds (AMBAC INS), 10/1/2027
1,480,000 New Orleans, LA, Refunding Revenue Bonds, 1,476,389
6.00% Bonds (FSA INS), 12/1/2000
360,000 Vail, CO Sales Tax Revenue, Refunding 340,927
Revenue Bonds, 6.00% Bonds (MBIA LOC),
12/1/2006
350,000 Vail, CO Sales Tax Revenue, Refunding 329,588
Revenue Bonds, 6.05% Bonds (MBIA LOC),
12/1/2007
TOTAL LONGTERM MUNICIPALS (identified cost 5,165,396
$5,350,180)
TREASURY SECURITIES--35.3%
U.S. Treasury Bonds--13.0%
5,000,000 United States Treasury Bond, 6.00%, 2/15/2026 4,754,850
2,750,000 United States Treasury Bond, 6.125%, 2,669,920
11/15/2027
1,000,000 United States Treasury Bond, 7.50%, 1,105,300
11/15/2016
1,300,000 United States Treasury Bond, 12.50%, 1,875,471
8/15/2014
Total 10,405,541
U.S. Treasury Notes--22.3%
1,000,000 United States Treasury Note, 6.625%, 1,019,660
4/30/2002
3,600,000 United States Treasury Note, 7.125%, 3,632,688
2/29/2000
11,500,000 United States Treasury Note, 7.50%, 5/15/2002 11,976,215
1,150,000 United States Treasury Note, 7.875%, 1,156,681
11/15/1999
Total 17,785,244
TOTAL TREASURY SECURITIES (identified cost 28,190,785
$29,251,945)
(2) REPURCHASE AGREEMENT--9.3%
7,405,000 State Street Corp., 5.36%, dated 8/31/1999, 7,405,000
due 9/1/1999 (at amortized cost)
TOTAL INVESTMENTS (identified cost $ 79,638,516
$81,837,102)
</TABLE>
U.S. GOVERNMENT INCOME FUND
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
LONG-TERM OBLIGATIONS--85.9%
Asset Backed Securities--2.9%
$ 1,250,000 American Express Credit Account Master Trust $ 1,260,550
1996-1, Class A, 6.800%, 12/15/2003
192,298 Premier Auto Trust 1995-4, Class A4, 6.575%, 192,721
10/6/2000
991,667 Sears Credit Account Master Trust 1995-2, 1,008,029
Class A, 8.100%, 6/15/2004
Total 2,461,300
Corporate Bonds--4.2%
1,200,000 Bear Stearns Cos., Inc., 6.150%, 3/2/2004 1,146,432
1,500,000 General Motors Acceptance Corp., 5.910%, 1,468,860
3/11/2002
1,000,000 J.P. Morgan & Co., Inc., 6.000%, 1/15/2009 908,700
Total 3,523,992
Corporate Note--1.2%
1,000,000 General Electric Capital Corp., 6.150%, 994,750
11/5/2001
Federal Home Loan Bank--9.1%
2,000,000 5.980%, 6/18/2008 1,868,060
3,000,000 6.050%, 1/27/2006 2,854,140
2,000,000 6.300%, 2/3/2009 1,873,920
850,000 7.010%, 6/14/2006 865,870
205,000 7.555%, 2/27/2002 210,469
Total 7,672,459
(5) Federal Home Loan Mortgage Corporation
PC--7.3%
1,500,000 5.825%, 2/9/2006 1,435,200
2,000,000 6.125%, 7/14/2003 1,960,780
1,000,000 6.148%, 9/23/2008 932,440
2,000,000 6.750%, 12/30/2013 1,867,592
Total 6,196,012
(5) Federal Home Loan Mortgage Corporation
REMIC--7.1%
135,814 6.000%, 10/15/2004 135,726
1,000,000 6.500%, 10/17/2020 999,450
3,074,000 7.000%, 11/15/2005 3,072,125
658,401 7.500%, 2/15/2003 666,539
1,000,000 7.500%, 9/15/2021 1,005,830
103,370 9.500%, 1/15/2005 106,577
Total 5,986,247
(5) Federal Home Loan Mortgage Corporation
15 Years--0.3%
46,487 9.000%, 8/1/2001 47,998
75,076 9.250%, 6/1/2002 76,696
21,763 9.500%, 10/1/2001 22,239
33,921 9.500%, 10/1/2004 35,363
36,135 9.500%, 12/1/2001 37,670
Total 219,966
(5) Federal Home Loan Mortgage Corporation
30 Years--0.7%
43,852 10.000%, 5/1/2014 47,277
134,054 10.000%, 6/1/2018 144,527
2,649 10.000%, 6/1/2020 2,856
7,975 10.000%, 6/1/2020 8,598
21,586 10.000%, 8/1/2019 23,273
258,394 8.750%, 2/1/2017 269,498
41,832 9.000%, 1/1/2017 43,793
4,471 9.000%, 10/1/2016 4,698
4,577 9.000%, 5/1/2018 4,791
32,786 9.000%, 6/1/2016 34,446
907 9.000%, 9/1/2016 950
15,530 9.500%, 10/1/2019 16,471
Total 601,178
(5) Federal National Mortgage
Association--15.9%
1,500,000 5.460%, 11/3/2003 1,436,415
1,000,000 5.480%, 11/16/2001 980,190
1,000,000 5.750%, 6/15/2005 956,040
1,000,000 5.830%, 10/16/2000 1,000,020
1,000,000 6.000%, 5/15/2008 943,270
2,500,000 6.170%, 8/4/2003 2,453,300
1,000,000 6.350%, 8/25/2005 968,350
465,000 6.460%, 6/29/2012 440,927
1,000,000 6.560%, 11/26/2007 961,680
500,000 6.710%, 7/24/2001 504,950
1,750,000 7.150%, 1/29/2007 1,731,275
1,000,000 7.280%, 5/23/2007 994,020
Total 13,370,437
(5) Federal National Mortgage Association
REMIC--1.1%
415,082 6.500%, 5/25/2023 407,619
417,882 7.500%, 3/25/2021 417,970
78,846 9.400%, 7/25/2003 81,245
Total 906,834
(5) Federal National Mortgage Association 15
Years--0.7%
610,007 7.000%, 8/1/2012 604,480
15,130 10.750%, 1/1/2001 16,061
Total 620,541
(5) Federal National Mortgage Association 30
Years--0.2%
103,139 8.500%, 2/1/2011 107,135
54,465 9.500%, 8/1/2020 57,937
Total 165,072
(5) Government National Mortgage Association
15 Years--0.4%
61,630 7.000%, 11/15/2009 61,264
276,986 7.000%, 9/15/2010 275,255
Total 336,519
(5) Government National Mortgage Association
30 Years--6.2%
446,255 7.500%, 10/15/2022 442,350
792,744 7.500%, 3/15/2026 786,053
1,093,465 8.000%, 1/15/2022 1,110,545
399,542 8.000%, 11/15/2022 404,536
924,733 8.000%, 4/15/2022 939,177
938,994 8.000%, 8/15/2022 953,661
179,304 9.000%, 2/15/2020 188,325
40,452 9.500%, 6/15/2020 43,398
57,992 9.500%, 6/15/2020 62,215
52,958 9.500%, 7/15/2020 57,062
45,028 9.500%, 7/15/2020 48,307
179,295 8.500%, 2/20/2025 185,625
Total 5,221,254
U.S. Treasury Bonds--13.4%
1,000,000 United States Treasury Bond, 10.750%, 1,145,260
2/15/2003
2,000,000 United States Treasury Bond, 6.000%, 1,901,940
2/15/2026
1,200,000 United States Treasury Bond, 6.250%, 1,178,172
8/15/2023
1,000,000 United States Treasury Bond, 6.875%, 1,059,170
8/15/2025
1,500,000 United States Treasury Bond, 7.250%, 1,617,960
5/15/2016
2,600,000 United States Treasury Bond, 7.250%, 2,848,326
8/15/2022
500,000 United States Treasury Bond, 7.875%, 580,565
2/15/2021
300,000 United States Treasury Bond, 8.500%, 367,878
2/15/2020
500,000 United States Treasury Bond, 8.750%, 628,095
5/15/2020
Total 11,327,366
U.S. Treasury Notes--15.2%
2,000,000 United States Treasury Note, 5.250%, 1,989,480
1/31/2001
500,000 United States Treasury Note, 5.625%, 487,560
2/15/2006
750,000 United States Treasury Note, 5.625%, 751,170
4/30/2000
1,700,000 United States Treasury Note, 5.875%, 1,703,672
11/30/2001
1,000,000 United States Treasury Note, 6.125%, 996,190
8/15/2007
1,500,000 United States Treasury Note, 6.250%, 1,505,670
2/15/2007
1,000,000 United States Treasury Note, 6.250%, 1,010,540
8/31/2002
250,000 United States Treasury Note, 6.500%, 254,380
10/15/2006
1,000,000 United States Treasury Note, 6.500%, 1,019,740
5/15/2005
500,000 United States Treasury Note, 6.500%, 508,460
5/31/2002
500,000 United States Treasury Note, 6.750%, 504,265
4/30/2000
1,000,000 United States Treasury Note, 7.000%, 1,045,190
7/15/2006
1,000,000 United States Treasury Note, 7.750%, 1,008,300
12/31/1999
Total 12,784,617
TOTAL LONG-TERM OBLIGATIONS (identified 72,388,544
cost $74,409,663)
(2) REPURCHASE AGREEMENT--13.8%
11,610,000 State Street Corp., 5.360%, dated 8/31/1999, 11,610,000
due 9/1/1999 (at amortized cost)
TOTAL INVESTMENTS (identified cost $ 83,998,544
$86,019,663) (2)
</TABLE>
CASH RESERVE FUND
<TABLE>
<CAPTION>
Principal Value
Amount
<C> <S> <C>
BANKERS ACCEPTANCE--3.2%
Finance--3.2%
$ 5,000,000 First Union Corp., 5.187%, 11/17/1999 $ 4,945,458
(6) COMMERCIAL PAPER--58.0%
Consumer Non- Durables--6.3%
5,000,000 Coca-Cola Co., 5.150%, 10/13/1999 4,970,308
5,000,000 Heinz (H.J.) Co., 5.160%, 9/21/1999 4,985,750
Total 9,956,058
Finance--22.2%
5,000,000 American General Corp., 5.146%, 4,991,500
9/13/1999
5,000,000 CIESCO, L.P., 5.146%, 9/8/1999 4,995,042
5,000,000 Falcon Asset Securitization Corp., 4,989,167
5.226%, 9/16/1999
5,000,000 Ford Motor Credit Corp., 5.199%, 4,970,075
10/13/1999
5,000,000 General Motors Acceptance Corp., 4,974,965
5.217%, 10/6/1999
5,000,000 Paccar Financial Corp., (PACCAR, Inc. 4,955,394
Support Agreement), 5.249%, 11/2/1999
5,000,000 Wells Fargo & Co., 5.321%, 11/8/1999 4,950,417
Total 34,826,560
Finance-Commercial--9.5%
5,000,000 CIT Group, Inc., 5.310%, 10/14/1999 4,968,526
5,000,000 General Electric Capital Corp., 4,975,000
5.086%, 10/7/1999
5,000,000 Deere (John) Capital Corp., 5.197%, 4,975,775
10/5/1999
Total 14,919,301
Finance-Retail--4.2%
1,600,000 Beta Finance, Inc., 5.152%, 9/8/1999 1,598,407
<CAPTION>
Principal
Amount
or Shares Value
$ 5,000,000 Commercial Credit Co., 5.102%, 9/8/1999 $ 4,995,071
Total 6,593,478
Health Technology--3.2%
5,000,000 Abbott Laboratories, 5.190%, 9/14/1999 4,990,665
Process Industries--3.1%
5,000,000 Du Pont (E.I.) de Nemours & Co., 4,891,111
5.737%, 1/19/2000
Technology Services--3.2%
5,000,000 Electronic Data Systems Corp., 5.162%, 4,990,025
9/15/1999
Utilities--6.3%
5,000,000 AT&T Capital Corp., 5.220%, 9/21/1999 4,985,556
5,000,000 BellSouth Telecommunications, Inc., 4,990,611
5.215%, 9/14/1999
Total 9,976,167
TOTAL COMMERCIAL PAPER 91,143,365
GOVERNMENT AGENCIES--17.1%
Finance--17.1%
5,000,000 (7) Federal Home Loan Bank System, 4,949,639
5.180%, 11/10/1999
10,000,000 (7) Federal Home Loan Mortgage Corp., 9,952,306
5.176%, 10/5/1999
5,000,000 (7) Federal Home Loan Mortgage Corp., 4,974,200
5.160%, 10/7/1999
2,081,000 (7) Federal National Mortgage 2,070,839
Association, 5.170%, 10/5/1999
5,000,000 (7) Federal National Mortgage 4,984,863
Association, 5.190%, 9/22/1999
TOTAL GOVERNMENT AGENCIES 26,931,847
MUTUAL FUND--2.5%
3,925,000 Fidelity Institutional Cash Treasury 3,925,000
Money Market Fund, (at net asset value)
<CAPTION>
Principal Value
Amount
(2) REPURCHASE AGREEMENTS--19.6%
$20,766,000 Morgan Stanley Dean Witter, 5.370%, $ 20,766,000
dated 8/31/1999, due 9/1/1999
10,062,000 State Street Corp., 5.360%, dated 10,062,000
8/31/1999, due 9/1/1999
TOTAL REPURCHASE AGREEMENTS 30,828,000
TOTAL INVESTMENTS (at amortized cost) $ 157,773,670
</TABLE>
U.S. TREASURY MONEY MARKET FUND
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
<C> <S> <C>
(7) U.S. TREASURY BILLS--51.2%
$ 5,000,000 4.350%, 10/28/1999 $ 4,964,217
10,000,000 4.355%-4.725%, 9/30/1999 9,963,428
25,000,000 4.500%-4.610%, 9/16/1999 24,953,437
10,000,000 4.565%-4.610%, 10/14/1999 9,945,205
5,000,000 4.580%, 9/23/1999 4,986,006
5,000,000 4.590%, 10/7/1999 4,977,050
20,000,000 4.610%-4.690%, 11/18/1999 19,799,204
5,000,000 4.690%, 11/4/1999 4,958,311
5,000,000 4.765%, 11/12/1999 4,952,350
5,000,000 4.820%, 11/26/1999 4,942,428
15,000,000 5.165%-5.190%, 9/15/1999 14,969,822
TOTAL U.S. TREASURY BILLS 109,411,458
MUTUAL FUND--3.3%
7,000,000 Fidelity Institutional Cash Treasury Money 7,000,000
Market Fund, (at net asset value)
(2) REPURCHASE AGREEMENTS--45.7%
$ 52,220,000 Morgan Stanley Dean Witter, 5.370%, dated 52,220,000
8/31/1999, due 9/1/1999
45,576,000 State Street Corp., 5.360%, dated 45,576,000
8/31/1999, due 9/1/1999
TOTAL REPURCHASE AGREEMENTS 97,796,000
TOTAL INVESTMENTS (at amortized cost) $ 214,207,458
</TABLE>
Notes to Portfolios of Investments
Hibernia Funds
August 31, 1999
(1) Non-income producing.
(2) The repurchase agreements are fully collateralized by U.S. Treasury
obligations based on market prices at the date of the portfolio.
(3) At August 31, 1999, 9.6% and 3.2% of the total investments at market value
were subject to alternative minimum tax for Hibernia Louisiana Municipal
Income Fund and Hibernia Total Return Bond Fund, respectively.
(4) Please refer to the Appendix of the Statement of Additional Information for
an explanation of the credit ratings. Current credit ratings are unaudited.
(5) Because of monthly principal payments, the average lives of certain
government securities are less than the indicated periods.
(6) Rate shown represents yield to maturity. (7) These issues show the rate of
discount at time of purchase.
The following abbreviations are used in these portfolios: ADR-- American
Depositary Receipt AMBAC-- American Municipal Bond Assurance Corporation COL--
Collateralized ESCW-- Escrowed by U.S. Government Securities FGIC-- Financial
Guaranty Insurance Corporation FHA-- Federal Housing Administration FNMA--
Federal National Mortgage Association FSA-- Financial Security Assurance GNMA--
Government National Mortgage Association GO-- General Obligation Bond GTD--
Guaranteed INS-- Insured ISD-- Independent School District HFA-- Housing Finance
Authority LOC-- Letter of Credit LT-- Limited Tax MBIA-- Municipal Bond
Insurance Association PFA-- Public Facility Authority PLC-- Public Limited
Company PRF-- Prerefunded PSFG-- Permanent School Fund Guarantee
Q-SBLF--Qualified State Bond Loan Fund SFM-- Single Family Mortgage UT--
Unlimited Tax
<TABLE>
<CAPTION>
For Federal Tax Purposes
- -----------------------------------------------------------------------------------------------------------------------------------
Net Unrealized Gross
Gross
Cost of Appreciation Unrealized Unrealized
Hibernia Funds Investments (Depreciation) Appreciation
Depreciation Total Net Assets*
<S> <C> <C> <C>
<C> <C>
Capital Appreciation Fund $237,760,262 $133,986,739 $141,289,286
$(7,302,547) $371,310,574
Louisiana Municipal Income Fund 94,417,741 1,420,940 2,824,178
(1,403,238) 92,701,900
Mid Cap Equity Fund 17,085,070 3,358,756 4,489,909
(1,131,153) 20,273,854
Total Return Bond Fund 81,837,102 (2,198,586) 72,050
(2,270,636) 79,913,040
U.S. Government Income Fund 86,019,663 (2,021,119) 373,922
(2,395,041) 84,241,622
Cash Reserve Fund
157,773,670 157,175,935
U.S. Treasury Money Market Fund
214,207,458 213,793,070
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* The categories of investments are shown as a percentage of net assets at
August 31, 1999.
(See notes which are an integral part of the Financial Statements)
<TABLE>
<CAPTION>
Capital Louisiana Municipal Mid Cap
Appreciation Fund Income Fund Equity Fund
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Assets:
Investments in repurchase agreements $ 6,712,000 $ -- $ 2,008,000
Investments in securities 365,035,001 95,838,681 18,435,826
Total investments in securities, at 371,747,001 95,838,681 20,443,826
value
Cash 276,144 -- --
Income receivable 428,547 1,262,566 15,508
Receivable for shares sold 159,354 8,726 2,870
Total assets 372,611,046 97,109,973 20,462,204
Liabilities:
Payable for investments purchased -- 2,486,548 --
Payable for shares redeemed 914,561 52,858 129,488
Payable for taxes withheld 13,506 -- --
Income distribution payable -- 249,659 --
Payable to Bank -- 1,575,120 6,415
Accrued expenses 372,405 43,888 52,447
Total liabilities 1,300,472 4,408,073 188,350
Net Assets Consist of:
Paid in capital 196,341,125 90,820,356 17,839,315
Net unrealized appreciation 133,986,739 1,420,940 3,365,213
(depreciation) of investments
Accumulated net realized gain (loss) 40,982,710 520,146 (930,674)
on investments
Undistributed net investment income -- (59,542) --
(Distributions in excess of net
investment income)
Total Net Assets $ 371,310,574 $92,701,900 $ 20,273,854
Net Assets: $ 352,875,422(1) $92,701,900 $ 18,283,460(3)
$ 18,435,152(2) $ 1,990,394(4)
Shares Outstanding 13,535,381(1) 8,545,050 1,611,099(3)
717,417(2) 176,271(4)
Total Shares Outstanding 14,252,798 8,545,050 1,787,370
Net Asset Value Per Share $ 26.07(1) $10.85 $ 11.35(3)
$ 25.70(2) -- $ 11.29(4)
Offering Price Per Share* $ 27.30(1)**** $11.19*** $ 11.88(3)****
$ 25.70(2) -- $ 11.29(4)
Redemption Proceeds Per Share** $ 26.07(1) $10.85 $ 11.35(3)
$ 24.29(2)***** -- $ 10.67(4)*****
Investments, at identified cost $ 237,760,262 $94,417,741 $ 17,078,613
Investments, at tax cost $ 237,760,262 $94,417,741 $ 17,085,070
- ---------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents Class A Shares of Capital Appreciation Fund.
(2) Represents Class B Shares of Capital Appreciation Fund.
(3) Represents Class A Shares of Mid Cap Equity Fund.
(4) Represents Class B Shares of Mid Cap Equity Fund.
(5) Represents Class A Shares of Cash Reserve Fund.
(6) Represents Class B Shares of Cash Reserve Fund.
* See "What Do Shares Cost" in the Prospectus.
** See "How to Redeem and Exchange Shares" in the Prospectus.
*** Computation of Offering Price: 100/97 of net asset value.
**** Computation of Offering Price: 100/95.50 of net asset value.
***** Computation of Redemption Proceeds: 94.50/100 of net asset value.
(See Notes which are an integral part of the Financial Statements)
<TABLE>
<CAPTION>
Total Return U.S. Government Cash Reserve U.S. Treasury
Bond Fund Income Fund Fund Money Market Fund
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 7,405,000 $11,610,000 $ 30,828,000 $ 97,796,000
72,233,516 72,388,544 126,945,670 116,411,458
79,638,516 83,998,544 157,773,670 214,207,458
-- -- 76,315 --
1,207,009 781,618 19,323 478,637
1,750 3,082 10,238 1,042
80,847,275 84,783,244 157,879,546 214,687,137
--
631,840 84,527 259,024 62,232
-- -- -- --
125,312 263,129 373,787 512,770
107,694 147,248 -- 212,778
69,389 46,718 70,800 106,287
934,235 541,622 703,611 894,067
89,523,329 157,175,935 213,793,070
82,058,140
(2,021,119) -- --
(2,198,586)
(3,274,072) -- --
(1,326)
13,484 -- --
54,812
$79,913,040 $84,241,622 $157,175,935 $213,793,070
$79,913,040 $84,241,622 $157,099,163(5) $213,793,070
-- -- $ 76,772(6) --
8,259,032 8,586,814 157,099,163(5) 213,793,070
-- -- 76,772(6) --
8,259,032 8,586,814 157,175,935 213,793,070
$9.68 $9.81 $ 1.00(5) $1.00
-- -- $ 1.00(6) --
$9.98*** $10.11*** $ 1.00(5) $1.00
-- -- $ 1.00(6) --
$9.68 $9.81 $ 1.00(5) $1.00
-- -- $ 1.00(6) --
$81,837,102 $86,019,663 $157,773,670 $214,207,458
$81,837,102 $86,019,663 $157,773,670 $214,207,458
- ----------------------------------------------------------------------------------------
</TABLE>
Statements of Operations
Hibernia Funds
August 31, 1999
<TABLE>
<CAPTION>
Capital louisiana
municipal Mid Cap
Appreciation Fund Income
Fund Equity Fund
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C>
<C> <C>
Investment Income:
Dividends $ 4,211,097 $
- -- $ 175,293
Interest 251,931
5,303,154 67,078
Total income 4,463,028
5,303,154 242,371
Expenses:
Investment advisory fee 2,663,596
440,117 138,101
Administrative personnel and services fee 395,787
109,123 50,001
Custodian fees 76,711
24,442 16,971
Transfer and dividend disbursing agent fees and expenses 130,222
31,031 67,083
Directors'/Trustees' fees 14,073
3,753 564
Auditing fees 15,180
15,993 8,461
Legal fees 6,396
5,292 5,448
Portfolio accounting fees 96,287
62,875 55,320
Distribution services fee 965,055(1)
203,273 52,930(2)
Shareholder services fee
38,595(4) 3,448(4)
Share registration costs 49,998
13,768 49,311
Printing and postage --
1,234 11,430
Insurance premiums 938
1,312 837
Miscellaneous 7,265
9,983 2,500
Total expenses 4,460,103
922,196 462,405
Waivers
Waiver of investment advisory fee --
(200,207) (98,423)
Waiver of distribution services fee --
(81,309) --
Waiver of administrative personnel and services fees --
- -- (29,486)
Total waivers --
(281,516) (127,909)
Net expenses 4,460,103
640,680 334,496
Net investment income (loss) 2,925
4,662,474 (92,125)
Realized and Unrealized Gain (Loss) on Investments:
Net realized gain (loss) on investments 41,577,429
520,146 (930,674)
Net change in unrealized appreciation (depreciation) of investments 65,911,793
(5,284,349) 6,496,547
Net realized and unrealized gain (loss) on investments 107,489,222
(4,764,203) 5,565,873
Change in net assets resulting from operations $107,492,147 $
(101,729) $5,473,748
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents distribution services fee of $849,270 and $115,785, for Class A
Shares and Class B Shares, respectively, of Capital Appreciation Fund.
(2) Represents distribution services fee of $42,585 and $10,345, for Class A
Shares and Class B Shares, respectively, of Mid Cap Equity Fund.
(3) Represents distribution services fee of $399,400 and $1,167, for Class A
Shares and Class B Shares, respectively, of Cash Reserves Fund.
(4) Represents shareholder services fee for Class B Shares.
(See Notes which are an integral part of the Financial Statements)
<TABLE>
<CAPTION>
Total Return U.S. Government Cash Reserve U.S. Treasury
Bond Fund Income Fund Fund Money Market Fund
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$ -- $ -- $ --
$ --
5,272,546 5,248,689 8,113,247
11,128,393
5,272,546 5,248,689 8,113,247
11,128,393
552,433 377,953 639,664
934,658
88,052 93,703 178,384
260,324
19,735 21,115
37,167 52,330
51,410 42,276
85,253 79,400
4,116 5,214
6,524 8,024
15,248 15,430
15,121 15,117
6,928 6,453
5,828 5,794
50,092 46,644
54,826 61,711
197,297 174,971
400,567(3) --
-- --
390(4) --
9,709 17,663
24,422 27,093
7,610 3,720
8,947 4,634
1,090 1,071
1,512 1,673
14,249 7,439
10,612 15,201
1,017,969 813,652 1,469,217
1,465,959
(236,757) (155,377)
- -- --
-- (69,989)
- -- --
-- --
- -- --
(236,757) (225,366)
- -- --
781,212 588,286 1,469,217
1,465,959
4,491,334 4,660,403 6,644,030
9,662,434
14,884 90,774
- -- --
(4,531,688) (4,453,381)
- -- --
(4,516,804) (4,362,607)
- -- --
$ (25,470) $ 297,796 $6,644,030 $
9,662,434
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
Statements of Changes in Net Assets
Hibernia Funds
<TABLE>
<CAPTION>
Capital Louisiana
Municipal
Appreciation Fund Income
Fund
Year Year
Year Year
Ended Ended
Ended Ended
August 31, August 31, August
31, August 31,
1999 1998
1999 1998
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
<C> <C>
Increase (Decrease) in Net
Assets:
Operations:
Net investment income (operating loss) $ 2,925 $ 967,708 $
4,662,474 $ 4,938,685
Net realized gain (loss) on investments 41,577,429 41,697,078
520,146 860,440
Net change in unrealized appreciation(depreciation) 65,911,793 (27,300,391)
(5,284,349) 2,003,434
Change in net assets resulting from operations 107,492,147 15,364,395
(101,729) 7,802,559
Distributions to
Shareholders:
Distributions from net investment income (35,622)(2) (935,011)(5)
(4,695,997) (4,957,912)
Distributions in excess of net investment income (229,738)(3)
- -- -- (25,155)
Distributions from net realized gain on investments (37,206,090)(4) (30,675,973)(6)
(638,525) (460,469)
Change in net assets from distributions to shareholders (37,471,090) (31,610,984)
(5,334,522) (5,443,536)
Share
Transactions:
Proceeds from sale of shares 42,077,441 53,381,213
12,059,476 8,710,403
Proceeds from shares issued in connection with
the
acquisition on the Common Trust Funds --
- -- -- --
Net asset value of shares issued to shareholders in 30,098,133 25,095,605
2,098,362 1,854,181
payment of distributions
declared
Cost of shares redeemed (61,503,186) (59,287,266)
(14,730,945) (15,653,812)
Change in net assets from share transactions 10,672,388 19,189,552
(573,107) (5,089,228)
Change in net assets 80,693,085 2,942,963
(6,009,358) (2,730,205)
Net
Assets:
Beginning of period 290,617,489 287,674,526
98,711,258 101,441,463
End of period $371,310,574 $290,617,489 $
92,701,900 $ 98,711,258
Undistributed net investment income (Distributions in $ $ 22,270 $
(59,542) $ (25,155)
excess of net investment income) included in net assets
- --
at end of
period
Net gain (loss) as computed for federal tax purposes $ 41,577,429 $ 41,643,171 $
520,146 $ 860,440
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the period from July 13, 1998 (start of performance) to August 31, 1998.
(2) Represents income distributions of $35,622 for Class A Shares only. (3)
Represents distributions in excess of net investment income for Class A
Shares only.
(4) Represents gain distributions of $35,588,767 and $1,617,323 for Class A
Shares and Class B Shares, respectively.
<TABLE>
<CAPTION>
Mid Cap Total Return U.S. Government
Equity Fund Bond Fund Income Fund
- ----------------------------------------------------------------------------------------------------
Year Period Year Year Year Year
Ended Ended Ended Ended Ended Ended
August 31, August 31, August 31, August 31, August 31, August 31,
1999 1998(1) 1999 1998 1999 1998
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$ (92,125) $ (10,642) $ 4,491,334 $ 4,304,953 $ 4,660,403 $ 3,848,099
(930,674) -- 14,884 588,562 90,774 528,099
6,496,547 (3,131,334) (4,531,688) 1,899,586 (4,453,381) 1,756,003
5,473,748 (3,141,976) (25,470) 6,793,101 297,796 6,132,201
-- -- (4,425,381) (4,306,667) (4,673,434) (3,791,842)
-- -- -- (10,481) -- --
-- -- (197,944) (472,991) -- --
-- -- (4,623,325) (4,790,139) (4,673,434) (3,791,842)
5,036,585 1,511,366 18,694,205 19,472,193 17,770,200 30,733,443
-- 15,919,383 -- -- -- --
3,149,240 3,439,628 1,409,149 665,703
(4,224,856) (300,396) (17,238,886) (16,824,326) (14,097,290) (9,642,177)
811,729 17,130,353 4,604,559 6,087,495 5,082,059 21,756,969
6,285,477 13,988,377 (44,236) 8,090,457 706,421 24,097,328
13,988,377 -- 79,957,276 71,866,819 83,535,201 59,437,873
$20,273,854 $13,988,377 $ 79,913,040 $ 79,957,276 $ 84,241,622 $83,535,201
$ -- $ -- $ 54,812 $ (10,481) $ 13,484 $ 26,452
$ (891,679) $ -- $ 16,210 $ 588,562 $ 89,715 $ 243,423
- ----------------------------------------------------------------------------------------------------
</TABLE>
Statements of Changes in Net Assets
Hibernia Funds
<TABLE>
<CAPTION>
Cash Reserve U.S. Treasury
Fund Money Market Fund
- -----------------------------------------------------------------------------------------------------------------------------
Year Year
Year Year
Ended Ended
Ended Ended
August 31, August 31, August 31,
August 31,
1999 1998
1999 1998
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
<C>
Increase (Decrease) in Net Assets:
Operations:
Net investment income $ 6,644,030 $ 7,760,553 $ 9,662,434
$ 8,578,035
Distributions to Shareholders:
Distributions from net investment income (6,644,030)(1) (7,760,553)
(9,662,434) (8,578,035)
Share Transactions:
Proceeds from sale of shares 447,612,934 506,085,291 801,070,866
858,263,159
Net asset value of shares issued to shareholders in 1,866,987 1,897,589
4,061,630 2,936,491
payment of distributions declared
Cost of shares redeemed (441,523,335) (509,140,899) (766,472,346)
(840,690,877)
Change in net assets from share transactions 7,956,586 (1,158,019)
38,660,150 20,508,773
Change in net assets 7,956,586 (1,158,019)
38,660,150 20,508,773
Net Assets:
Beginning of period 149,219,349 150,377,368 175,132,920
154,624,147
End of period $ 157,175,935 $ 149,219,349 $ 213,793,070 $
175,132,920
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents income distributions of $6,638,815 and $5,215 for Class A Shares
and Class B Shares, respectively.
(See Notes which are an integral part of the Financial Statements)
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Net Realized and
Net Asset Net Unrealized Distributions Distributions
Value, Investment Gain/(Loss) on Total From From Net From Net
Year Ended Beginning Income Investment Investment Investment Realized Gain
August 31 of Period (Loss) Transactions Operations Income on Investments
<S> <C> <C> <C> <C> <C> <C>
<CAPTION>
Capital Appreciation Fund--Class A Shares
1995 $13.81 0.22 2.54 2.76 (0.21) (0.27)
1996 $16.09 0.19 2.62 2.81 (0.19) (0.84)
1997 $17.87 0.15 6.51 6.66 (0.16) (1.99)
1998 $22.38 0.08 1.09 1.17 (0.07) (2.34)
1999 $21.14 0.01 7.73 7.74 (0.00)(8) (2.79)
<CAPTION>
Capital Appreciation Fund--Class B Shares
1997(1) $18.90 (0.01)(2) 3.48 3.47 -- --
1998 $22.32 (0.06) 1.07 1.01 -- (2.34)
1999 $20.99 (0.16) 7.66 7.50 -- (2.79)
<CAPTION>
Louisiana Municipal Income Fund
1995 $10.82 0.59 0.24 0.83 (0.58) (0.08)
1996 $10.99 0.60 (0.05) 0.55 (0.60) --
1997 $10.94 0.57 0.28 0.85 (0.58) --
1998 $11.21 0.56 0.32 0.88 (0.57) (0.05)
1999 $11.47 0.54 (0.54) 0.00 (0.54) (0.08)
<CAPTION>
Mid Cap Equity Fund--Class A Shares
1998(7) $10.00 (0.01) (1.85) (1.86) -- --
1999 $ 8.14 (0.05)(2) 3.26 3.21 -- --
<CAPTION>
Mid Cap Equity Fund--Class B Shares
1998(7) $10.00 (0.01) (1.86) (1.87) -- --
1999 $ 8.13 (0.13)(2) 3.29 3.16 -- --
<CAPTION>
Total Return Bond Fund
1995 $ 9.64 0.56 0.39 0.95 (0.54) --
1996 $10.05 0.56 (0.27) 0.29 (0.57) --
1997 $ 9.77 0.60 0.23 0.83 (0.61) --
1998 $ 9.99 0.58 0.35 0.93 (0.58) (0.07)
1999 $10.27 0.58 (0.57) 0.01 (0.57) (0.03)
<CAPTION>
U.S. Government Income Fund
1995 $ 9.92 0.71 0.20 0.91 (0.69) --
1996 $10.14 0.67 (0.30) 0.37 (0.69) --
1997 $ 9.82 0.62 0.18 0.80 (0.64) --
1998 $ 9.98 0.61 0.34 0.95 (0.60) --
1999 $10.33 0.57 (0.52) 0.05 (0.57) --
<CAPTION>
Cash Reserve-- Fund Class A Shares
1995 $ 1.00 0.05 -- 0.05 (0.05) --
1996 $ 1.00 0.05 -- 0.05 (0.05) --
1997 $ 1.00 0.05 -- 0.05 (0.05) --
1998 $ 1.00 0.05 -- 0.05 (0.05) --
1999 $ 1.00 0.04 -- 0.04 (0.04) --
<CAPTION> Cash Reserve Fund--Class B Shares
1999(9) $ 1.00 0.03 -- 0.03 (0.03) --
<CAPTION>
U.S. Treasury Money Market Fund
1995 $ 1.00 0.05 -- 0.05 (0.05) --
1996 $ 1.00 0.05 -- 0.05 (0.05) --
1997 $ 1.00 0.05 -- 0.05 (0.05) --
1998 $ 1.00 0.05 -- 0.05 (0.05) --
1999 $ 1.00 0.04 -- 0.04 (0.04) --
</TABLE>
<TABLE>
<CAPTION>
Distributions
in Excess
of Net
Year Ended Investment Total
August 31 Income Distributions
<S> <C> <C>
<CAPTION>
Capital Appreciation Fund--Class A Shares
1995 -- (0.48)
1996 -- (1.03)
1997 -- (2.15)
1998 -- (2.41)
1999 (0.02)(3) (2.81)
<CAPTION>
Capital Appreciation Fund--Class B Shares
1997(1) (0.05)(3) (0.05)
1998 -- (2.34)
1999 -- (2.79)
<CAPTION>
Louisiana Municipal Income Fund
1995 -- (0.66)
1996 -- (0.60)
1997 -- (0.58)
1998 (0.00)(3)(8) (0.62)
1999 -- (0.62)
<CAPTION>
Mid Cap Equity Fund--Class A Shares
1998(7) -- --
1999 -- --
<CAPTION>
Mid Cap Equity Fund--Class B Shares
1998(7) -- --
1999 -- --
<CAPTION>
Total Return Bond Fund
1995 -- (0.54)
1996 -- (0.57)
1997 -- (0.61)
1998 (0.00)(3)(8) (0.65)
1999 -- (0.60)
<CAPTION>
U.S. Government Income Fund
1995 -- (0.69)
1996 -- (0.69)
1997 -- (0.64)
1998 -- (0.60)
1999 -- (0.57)
<CAPTION>
Cash Reserve-- Fund Class A Shares
1995 -- (0.05)
1996 -- (0.05)
1997 -- (0.05)
1998 -- (0.05)
1999 -- (0.04)
<CAPTION> Cash Reserve Fund--Class B Shares
1999(9) -- (0.03)
<CAPTION>
U.S. Treasury Money Market Fund
1995 -- (0.05)
1996 -- (0.05)
1997 -- (0.05)
1998 -- (0.05)
1999 -- (0.04)
</TABLE>
(1) Reflects operations for the period from December 2, 1996 (date of initial
public offering) to August 31, 1997.
(2) Per share information presented is based on the monthly average number of
shares outstanding divided by the net operating loss due to large
fluctuations in the number of shares outstanding during the period.
(3) These distributions in excess of net investment income were a result of
certain book and tax timing differences. These distributions do not
represent a return of capital for federal tax purposes.
(4) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(See Notes which are an integral part of the Financial Statements)
<TABLE>
<CAPTION>
Ratios to Average Net Assets
- ---------------------------------------------------------------------------------
Net
Net
Investment Investment Net
Assets
Net Asset Value, Total Income Expense Income (Loss) End of
Period Portfolio
End of Period Return(4) Expenses(5) (Loss)(5) (after waivers) (after waivers) (000
omitted) Turnover Rate
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
<C> <C>
$16.09 20.71% 1.25% 1.46% 1.25% 1.46%
$144,476 69%
$17.87 18.03% 1.24% 1.08% 1.24% 1.08%
$169,648 69%
$22.38 39.56% 1.24% 0.72% 1.24% 0.72%
$283,040 62%
$21.14 5.12% 1.21% 0.32% 1.21% 0.32%
$279,778 62%
$26.07 38.35% 1.22% 0.03% 1.22% 0.03%
$352,876 44%
$22.32 18.40% 1.99%(6) (0.09%)(6) 1.99%(6) (0.09%)(6) $
4,635 62%
$20.99 4.36% 1.96% (0.44%) 1.96% (0.44%) $
10,840 62%
$25.70 37.35% 1.98% (0.73%) 1.98% (0.73%) $
18,435 44%
$10.99 8.20% 0.85% 5.46% 0.77% 5.54% $
67,600 22%
$10.94 5.04% 0.82% 5.29% 0.74% 5.37% $
65,717 17%
$11.21 8.31% 0.77% 5.11% 0.69% 5.19%
$101,441 17%
$11.47 8.04% 0.74% 4.86% 0.66% 4.94% $
98,711 24%
$10.85 (0.08%) 0.95% 4.48% 0.66% 4.77% $
92,702 17%
$ 8.14 (18.60%) 2.09%(6) (0.68%)(6) 1.89%(6) (0.48%)(6) $
13,422 1%
$11.35 39.43% 2.46% (1.14%) 1.76% (0.44%) $
18,283 55%
$ 8.13 (18.70%) 2.93%(6) (1.39%)(6) 2.76%(6) (1.22%)(6) $
567 1%
$11.29 38.87% 3.14% (1.84%) 2.51% (1.21%) $
1,990 55%
$10.05 10.19% 1.30% 5.71% 1.30% 5.71% $
69,455 91%
$ 9.77 2.90% 1.29% 5.57% 1.29% 5.57% $
71,188 38%
$ 9.99 8.71% 1.29% 6.00% 1.29% 6.00% $
71,867 65%
$10.27 9.51% 1.25% 5.49% 1.08% 5.66% $
79,957 31%
$ 9.68 (0.03%) 1.29% 5.39% 0.99% 5.69% $
79,913 20%
$10.14 9.60% 0.88% 6.96% 0.82% 7.02% $
42,593 5%
$ 9.82 3.72% 0.93% 6.58% 0.87% 6.64% $
37,544 27%
$ 9.98 8.39% 0.94% 6.25% 0.88% 6.31% $
59,438 72%
$10.33 9.74% 0.79% 5.92% 0.73% 5.98% $
83,535 44%
$ 9.81 0.41% 0.97% 5.28% 0.70% 5.55% $
84,242 24%
$ 1.00 4.97% 0.86% 4.87% 0.86% 4.87%
$191,242 --
$ 1.00 4.79% 0.87% 4.69% 0.87% 4.69%
$168,344 --
$ 1.00 4.70% 0.89% 4.59% 0.89% 4.59%
$150,377 --
$ 1.00 4.82% 0.89% 4.72% 0.89% 4.72%
$149,219 --
$ 1.00 4.23% 0.92% 4.16% 0.92% 4.16%
$157,099 --
$ 1.00 3.37% 1.67%(6) 3.35%(6) 1.67%(6) 3.35%(6) $
77 --
$ 1.00 5.15% 0.68% 4.93% 0.46% 5.15%
$116,489 --
$ 1.00 5.08% 0.66% 4.73% 0.44% 4.95%
$136,068 --
$ 1.00 4.92% 0.64% 4.67% 0.50% 4.81%
$154,624 --
$ 1.00 4.89% 0.63% 4.78% 0.63% 4.78%
$175,133 --
$ 1.00 4.23% 0.63% 4.14% 0.63% 4.14%
$213,793 --
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(5) During the period, certain fees were voluntarily waived. If such voluntary
waivers had not occurred, the ratios would have been as indicated.
(6) Computed on an annualized basis.
(7) Reflects operations for the period from July 13, 1998 (date of initial
public offering) to August 31, 1998.
(8) Amount is less than $0.01 per share.
(9) Reflects operations for the period from September 4, 1998 (date of initial
public offering) to August 31, 1999.
Combined Notes to Financial Statements
Hibernia Funds
August 31, 1999
(1) ORGANIZATION
Hibernia Funds (formerly, Tower Mutual Funds), (the "Trust") is registered under
the Investment Company Act of 1940, as amended (the "Act"), as an open-end
management investment company. The Trust consists of seven portfolios
(individually referred to as the "Fund", or collectively as the "Funds") which
are presented herein:
<TABLE>
<CAPTION>
Portfolio Name Diversification Investment Objective
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
Hibernia Capital Appreciation Fund diversified provide growth of capital and
income.
(formerly Tower Capital Appreciation Fund)
("Capital Appreciation Fund")
- -----------------------------------------------------------------------------------------------------------------------------
Hibernia Louisiana Municipal Income Fund non-diversified provide current income
which is (formerly Tower Louisiana Municipal Income Fund) generally exempt from
federal income ("Louisiana Municipal Income Fund") tax and personal income taxes
imposed by the state of Louisiana.
- -----------------------------------------------------------------------------------------------------------------------------
Hibernia Mid Cap Equity Fund diversified total return.
(formerly Tower Mid Cap Equity Fund)
("Mid Cap Equity Fund")
- -----------------------------------------------------------------------------------------------------------------------------
Hibernia Total Return Bond Fund diversified maximize total return.
(formerly Tower Total Return Bond Fund)
("Total Return Bond Fund")
- -----------------------------------------------------------------------------------------------------------------------------
Hibernia U.S. Government Income Fund diversified provide current income.
(formerly Tower U.S. Government Income Fund)
("U.S. Government Income Fund")
- -----------------------------------------------------------------------------------------------------------------------------
Hibernia Cash Reserve Fund diversified provide current income consistent
(formerly Tower Cash Reserve Fund) with stability of principal.
("Cash Reserve Fund")
- -----------------------------------------------------------------------------------------------------------------------------
Hibernia U.S. Treasury Money Market Fund diversified provide current income consistent
with
(formerly U.S. Treasury Money Market Fund) stability of principal and
liquidity.
("U.S. Treasury Money Market Fund")
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
The assets of each portfolio are segregated and a shareholder's interest is
limited to the portfolio in which shares are held.
On July 13, 1998, Mid Cap Equity Fund acquired a portfolio of a collective trust
fund ("Aquired Fund") managed by the adviser (the "Acquisition"). The
Acquisition was accomplished by a tax-free exchange of 1,591,938 shares of Mid
Cap Equity Fund (valued at $15,919,383) for the 277,944 shares of the Acquired
Fund outstanding on July 13, 1998. The Acquired Fund's net assets of
$15,919,383, which consisted of Paid in Capital, at the date were combined with
those of Mid Cap Equity Fund. The aggregate net assets of Mid Cap Equity Fund
and the Acquired Fund immediately before the Acquisition were $0 and $15,919,383
respectively.
Effective November 1, 1998 Tower Mutual Funds changed its name to Hibernia
Funds.
(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.
Investment Valuations--Municipal bonds are valued by an independent pricing
service, taking into consideration yield, liquidity, risk, credit quality,
coupon, maturity, type of issue, and any other factors or market data the
pricing service deems relevant. U.S. government securities, listed corporate
bonds, and other fixed income and asset-backed securities are generally
valued at the mean of the latest bid and asked price as furnished by an
independent pricing service. Listed equity securities are valued at the last
sale price reported on a national securities exchange. Cash Reserve and U. S.
Treasury Money Market Funds use the amortized cost method to value portfolio
securities in accordance with Rule 2a-7 under the Act. For Capital
Appreciation Fund, Louisiana Municipal Income Fund, Mid Cap Equity Fund,
Total Return Bond Fund, and U.S. Government Income Fund, short-term
securities are valued at the prices provided by an independent pricing
service. However, short-term securities purchased with remaining maturities
of sixty days or less may be valued at amortized cost, which approximates
fair market value. Investments in other open-end regulated investment
companies are valued at net asset value.
Repurchase Agreements--It is the policy of the Funds to require the custodian
bank to take possession, to have legally segregated in the Federal Reserve
Book Entry System, or to have segregated within the custodian bank's vault,
all securities held as collateral under repurchase agreement transactions.
Additionally, procedures have been established by the Funds to monitor, on a
daily basis, the market value of each repurchase agreement's collateral to
ensure that the value of collateral at least equals the repurchase price to
be paid under the repurchase agreement transaction.
The Funds will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed
by the Funds' adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the "Trustees").
Investment Income, Expenses and Distributions--Interest income and expenses
are accrued daily. Bond premium and discount, if applicable, are amortized as
required by the Internal Revenue Code, as amended (the "Code"). Dividend
income and distributions to shareholders are recorded on the ex-dividend
date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing book/tax
treatments of market discount reclasses, paydown gains and losses, and net
operating losses. The following reclassifications have been made to the
financial statements.
<TABLE>
<CAPTION>
Increase (Decrease)
- --------------------------------------------------------------------------------------------------------------------------
Undistributed
Accumulated
Paid-In Net Investment Net
Realized
Fund Capital Income (Loss) Gain
(Loss)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Capital Appreciation Fund -- $10,427
$(10,427)
Louisiana Municipal Income Fund $ (7,828) (864)
8,692
Mid Cap Equity Fund (92,125) 92,125
- --
Total Return Bond Fund -- (660)
660
U.S. Government Income Fund 364 63
(427)
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
Federal Taxes--It is the Funds' policy to comply with the provisions of the
Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of their income. Accordingly, no
provisions for federal tax are necessary.
At August 31, 1999, the Mid Cap Equity Fund and U.S. Government Income Fund,
for federal tax purposes, had capital loss carryforwards, as noted below,
which will reduce the Funds' taxable income arising from future net realized
gain on investments, if any, to the extent permitted by the Code, and thus
will reduce the amount of the distributions to shareholders which would
otherwise be necessary to relieve the Funds of any liability for federal tax.
Pursuant to the Code, such capital loss carryforward will expire as follows:
<TABLE>
<CAPTION>
Expiration Year
- -------------------------------------------------------------------------------------------------------------
Total Tax Loss
Fund 2003 2004 2005 2007 Carryforward
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Mid Cap Equity $ -- $ -- $ -- $891,679 $ 891,679
U.S. Government Income Fund 1,422,238 1,298,006 553,828 -- 3,274,072
- -------------------------------------------------------------------------------------------------------------
</TABLE>
Additionally, the following Funds had capital losses attributable to security
transactions incurred after October 31, 1998, which were treated as arising
on September 1, 1999, the first day of each Fund's next taxable year as
follows:
<TABLE>
<CAPTION>
Capital Losses
Fund Deferred
- -----------------------------------------------------------------------------------------
<S> <C>
Mid Cap Equity Fund $(32,538)
Total Return Bond Fund (1,326)
- -----------------------------------------------------------------------------------------
</TABLE>
When-Issued and Delayed Delivery Transactions--The Funds may engage in when-
issued or delayed delivery transactions. The Funds record when-issued
securities on the trade date and maintain security positions such that
sufficient liquid assets will be available to make payment for the securities
purchased. Securities purchased on a when-issued or delayed delivery basis
are marked to market daily and begin earning interest on the settlement date.
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 amounts of assets, liabilities,
expenses and revenues reported in the financial statements. Actual results
could differ from those estimated.
Other--Investment transactions are accounted for on the trade date.
(3) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in shares were as follows:
EQUITY AND INCOME FUNDS
<TABLE>
<CAPTION>
Capital Appreciation Fund
- ---------------------------------------------------------------------------------------------------------------------
Year Ended Year Ended
August 31, 1999 August 31, 1998
- ---------------------------------------------------------------------------------------------------------------------
Class A Shares Shares Dollars Shares
Dollars
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 1,456,003 $ 36,315,322 1,944,199 $
45,967,030
Shares issued to shareholders in payment
of distributions declared 1,241,674 28,632,787 1,143,415
24,488,265
Shares redeemed (2,398,866) (59,199,878) (2,499,674)
(58,552,238)
Net change resulting from Class A
Share transactions 298,811 $ 5,748,231 587,940 $
11,903,057
</TABLE>
<TABLE>
<CAPTION>
Capital Appreciation Fund
- -------------------------------------------------------------------------------------------------
Year Ended Year Ended
August 31, 1999 August 31, 1998
- -------------------------------------------------------------------------------------------------
Class B Shares Shares Dollars Shares Dollars
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 232,004 $ 5,762,119 311,166 $ 7,414,183
Shares issued to shareholders in
payment of distributions declared 64,099 1,465,346 28,474 607,340
Shares redeemed (95,160) (2,303,308) (30,789) (735,028)
Net change resulting from Class B
Share transactions 200,943 $ 4,924,157 308,851 $ 7,286,495
Net change resulting from
Share transactions 499,754 $10,672,388 896,791 $19,189,552
</TABLE>
<TABLE>
<CAPTION>
Mid Cap Equity Fund
- ----------------------------------------------------------------------------------------------------------------------
Year Ended Period Ended
August 31, 1999 August 31,
1998(1)
- ----------------------------------------------------------------------------------------------------------------------
Class A Shares Shares Dollars Shares
Dollars
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 350,677 $ 3,781,027 88,819 $
836,513
Shares issued in connection with the Acquisition -- -- 1,591,938
15,919,383
Shares redeemed (388,318) (4,070,418) (32,017)
(300,346)
Net change resulting from Class A
Share transactions (37,641) $ (289,391) 1,648,740
$16,455,550
</TABLE>
<TABLE>
<CAPTION>
Mid Cap Equity Fund
- ----------------------------------------------------------------------------------------------------------------------
Year Ended Period Ended
August 31, 1999 August 31, 1998(1)
- ----------------------------------------------------------------------------------------------------------------------
Class B Shares Shares Dollars Shares Dollars
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 121,109 $1,255,558 69,657 $
674,853
Shares redeemed (14,490) (154,438)
(5) (50)
Net change resulting from
Class B
Share transactions 106,619 $1,101,120 69,652 $
674,803
Net change resulting from
Class B
Share transactions 68,978 $ 811,729 1,718,392
$17,130,353
</TABLE>
(1) For the period from July 13, 1998 (date of initial public offering) to
August 31, 1998.
<TABLE>
<CAPTION>
Louisiana Municipal Total Return U.S.
Government
Income Fund Bond Fund Income
Fund
- ---------------------------------------------------------------------------------------------------------------------------
Year Year Year Year
Year Year
Ended Ended Ended Ended
Ended Ended
August 31, August 31, August 31, August 31, August 31,
August 31,
1999 1998 1999 1998
1999 1998
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
<C>
Shares sold 1,064,927 767,090 1,884,047 1,917,601 1,742,267
3,009,055
Shares issued to shareholders in
payment of distributions declared 185,636 163,782 313,068 340,357
138,932 65,543
Shares redeemed (1,309,582) (1,379,228) (1,725,600) (1,660,779)
(1,379,614) (947,489)
Net change resulting from share transactions (59,019) (448,356) 471,515 (597,179) 501,585
2,127,109
</TABLE>
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
Cash Reserve
Fund
- -----------------------------------------------------------------------------------------------------------------------------
Year Year
Ended Ended
August 31,
August 31,
Class A Shares
1999 1998
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C>
<C>
Shares sold 447,343,384
506,085,291
Shares issued to shareholders in payment of distributions declared
1,862,117 1,897,589
Shares redeemed (441,325,587)
(509,140,899)
Net change resulting from Class A Share transactions
7,879,914 (1,158,019)
</TABLE>
<TABLE>
<CAPTION>
Cash Reserve
Fund
- -----------------------------------------------------------------------------------------------------------------------------
Period Year
Ended Ended
August
31, August 31,
Class B Shares
1999(2) 1998
- -----------------------------------------------------------------------------------------------------------------------------
<S>
<C> <C>
Shares sold
269,550 --
Shares issued to shareholders in payment of distributions declared
4,870 --
Shares redeemed
(197,748) --
Net change resulting from Class B Share transactions
76,672 --
Net change resulting from Share transactions
7,956,586 (1,158,019)
</TABLE>
(2) For the period from September 4, 1998 (date of initial public investment)
to August 31, 1999.
<TABLE>
<CAPTION>
U.S.
Treasury
Money
Market Fund
- ----------------------------------------------------------------------------------------------------------------------------
Year Year
Ended Ended
August 31,
August 31,
1999 1998
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C>
<C>
Shares sold 801,070,866
858,263,159
Shares issued to shareholders in payment of distributions declared
4,061,630 2,936,491
Shares redeemed (766,472,346)
(840,690,877)
Net change resulting from share transactions 38,660,150
20,508,773
</TABLE>
(4) INVESTMENT ADVISORY FEE AND OTHER
TRANSACTIONS WITH AFFILIATES
Investment Advisory Fee--Hibernia National Bank, the Funds' investment adviser
(the "Adviser") is entitled to receive for its services an annual investment
advisory fee based on a percentage of each Fund's average daily net assets (see
below). <TABLE> <CAPTION>
Annual
Fund Rate
- ------------------------------------------------------------------
<S> <C>
Capital Appreciation Fund 0.75%
Louisiana Municipal Income Fund 0.45%
Mid Cap Equity Fund 0.75%
Total Return Bond Fund 0.70%
U.S. Government Income Fund 0.45%
Cash Reserve Fund 0.40%
U.S. Treasury Money Market Fund 0.40%
</TABLE>
The Adviser may voluntarily choose to waive any portion of its fee. The Adviser
can modify or terminate this voluntary waiver at any time at its sole
discretion.
Administrative Fee--Federated Administrative Services ("FAS") provides the Funds
with certain administrative personnel and services. The fee paid to FAS is based
on the level of average aggregate net assets of the Funds for the period. FAS
may voluntarily choose to waive any portion of its fee. FAS can modify or
terminate this voluntary waiver at any time at its sole discretion.
Distribution Services Fee--The Funds have adopted a Distribution Plan (the
"Plan") pursuant to Rule 12b-1 under the Act. Under the terms of the Plan, the
Funds will reimburse Federated Securities Corp. ("FSC"), the principal
distributor, from the net assets of the Funds to finance activities intended to
result in the sale of each Fund's shares. The Plan provides that the Funds,
except for Class B Shares of the Capital Appreciation Fund, Mid Cap Equity Fund
and Cash Reserve Fund, may incur distribution expenses up to 0.25% of the
average daily net assets of the Funds, annually, to reimburse FSC. Class B
Shares of the Capital Appreciation Fund, Mid Cap Equity Fund and Cash Reserve
Fund may incur distribution expenses up to 0.75% of the average daily net assets
of the Class B Shares, annually, to reimburse FSC. For the year ended August 31,
1999, the U.S. Treasury Money Market Fund did not incur distribution services
fees.
Shareholder Services Fee--Under the terms of a Shareholder Services Agreement
with Federated Shareholder Services Company ("FSSC"), Class B Shares of Capital
Appreciation Fund and Mid Cap Equity Fund will pay FSSC up to 0.25% of its daily
average net assets for the period. The fee paid to FSSC is used to finance
certain services for shareholders and to maintain shareholder accounts.
Transfer and Dividend Disbursing Agent Fees and Expenses--Federated Services
Company ("FServ"), through its subsidiary, FSSC serves as transfer and dividend
disbursing agent for the Funds. The fee paid to FSSC is based on the size, type,
and number of accounts and transactions made by shareholders.
Portfolio Accounting Fees--FServ maintains the Funds' accounting records for
which it receives a fee. The fee is based on the level of each Fund's average
daily net assets for the period, plus out-of-pocket expenses.
Custodian Fees--Hibernia National Bank is the Funds' custodian for which it
receives a fee. The fee is based on the level of each Fund's average daily net
assets for the period, plus out-of-pocket expenses.
Interfund Transactions--During the year ended August 31, 1999, the Louisiana
Municipal Income Fund engaged in purchase and sale transactions with funds that
have a common investment adviser (or affiliated investment advisers), common
Directors/Trustees, and/or common Officers. These purchase and sale transactions
were made at current market value pursuant to Rule 17a-7 under the Act amounting
to $5,702,961 and $4,865,848.
Other Affiliated Parties and Transactions--Pursuant to an exemptive order issued
by the SEC, the Funds may invest in certain affiliated money market funds. As of
August 31, 1999, the Louisiana Municipal Income Fund owned 0.09% of outstanding
shares of Federated Tax-Free Obligations Fund, which is distributed by an
affiliate of the Fund's distributor.
General--Certain of the Officers of the Trust are Officers and Directors or
Trustees of the above companies.
(5) INVESTMENT TRANSACTIONS
Purchases and sales of investments, excluding short-term securities, for the
year ended August 31, 1999, were as follows:
<TABLE>
<CAPTION>
Fund Purchases Sales
- --------------------------------------------------------------------------------------------
<S> <C> <C>
Capital Appreciation Fund $151,878,487 $179,282,242
Louisiana Municipal Income Fund $ 17,257,596 $ 16,634,214
Mid Cap Equity Fund $ 10,353,473 $ 9,358,848
Total Return Bond Fund $ 15,275,162 $ 15,427,380
U.S. Government Income Fund $ 18,745,028 $ 20,552,280
</TABLE>
(6) CONCENTRATION OF CREDIT RISK
Since Louisiana Municipal Income Fund invests a substantial portion of its
assets in issuers located in one state, it will be more susceptible to factors
adversely affecting issuers of that state than would be a comparable tax-exempt
mutual fund that invests nationally. In order to reduce the credit risk
associated with such factors, at August 31, 1999, 75.7% of the securities in
Louisiana Municipal Income Fund are backed by letters of credit or bond
insurance of various financial institutions and financial guaranty assurance
agencies. The value of investments insured by or supported (backed) by a letter
of credit from any one institution or agency did not exceed 24.6% of total
investments.
(7) YEAR2000 (UNAUDITED)
Similar to other financial organizations, the Funds could be adversely affected
if the computer systems used by the Funds' service providers do not properly
process and calculate date-related information and data from and after January
1, 2000. The Funds' Adviser and administrator are taking measures that they
believe are reasonably designed to address the Year 2000 issue with respect to
computer systems that they use and to obtain reasonable assurances that
comparable steps are being taken by each of the Funds' other service providers.
At this time, however, there can be no assurance that these steps will be
sufficient to avoid any adverse impact to the Funds.
Report of Ernst & Young LLP, Independent Auditors
To the Trustees and Shareholders of
HIBERNIA FUNDS:
We have audited the accompanying statements of assets and liabilities,
including the portfolios of investments, of Hibernia Funds (comprising,
respectively, Hibernia Capital Appreciation Fund, Hibernia Louisiana Municipal
Income Fund, Hibernia Mid Cap Equity Fund, Hibernia Total Return Bond Fund,
Hibernia U.S. Government Income Fund, Hibernia Cash Reserve Fund and Hibernia
U.S. Treasury Money Market Fund) as of August 31, 1999 and the related
statements of operations for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended, and financial
highlights for each of the periods presented therein. These financial statements
and financial highlights are the responsibility of the Trust's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
August 31, 1999, by correspondence with the custodian and brokers, or other
appropriate auditing procedures where replies from brokers were not received. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the respective portfolios constituting Hibernia Funds at August 31, 1999, the
results of their operations for the year then ended, the changes in their net
assets for each of the two years in the period then ended, and the financial
highlights for each of the periods presented therein, in conformity with
generally accepted accounting principles.
/s/Ernst & Young LLP
Boston, Massachusetts
October 19, 1999
HIBERNIA FUNDS
Trustees and Officers
TRUSTEES
Edward C. Gonzales
Robert L. diBenedetto, M.D.
Arthur Rhew Dooley, Jr.
James A. Gayle, Sr.
J. Gordon Reische
OFFICERS
Edward C. Gonzales
President and Treasurer
Jeffrey W. Sterling
Vice President and Assistant Treasurer
Peter J. Germain
Secretary
Timothy S. Johnson
Assistant Secretary
Mutual funds are not bank deposits or obligations, are not guaranteed by any
bank, and are not insured or guaranteed by the U.S. government, the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in mutual funds involves investment risk,
including possible loss of principal amount invested. Although money market
funds seek to maintain a stable net asset value of $1.00 per share, there is no
assurance that they will be able to do so.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by the Funds' prospectus which contains facts concerning
their objectives and policies, management fees, expenses and other information.
Federated Securities Corp., Distributor of the funds
G01262-01 (10/99)
1A. The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Hibernia Capital Appreciation Fund based on a 4.50% sales load are
represented by a solid line. The Standard & Poor's 500 Index (the "S&P 500") is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the Class
A Shares of the fund and the S&P 500. The "x" axis reflects computation periods
from 8/31/89 to 8/31/99. The "y" axis reflects the cost of the investment. The
right margin reflects the ending value of the hypothetical investment in the
fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P 500.
The ending values were $41,899 and $48,440, respectively. The legend in the
bottom quadrant of the graphic presentation indicates the fund's Class A Shares
Average Annual Total Returns for the one-year, five-year and 10-year periods
ended 8/31/99. The total returns were 32.10%, 22.53%, and 15.40%, respectively.
1B. The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class B
Shares of Hibernia Capital Appreciation Fund based on a 4.00% contingent
deferred sales load are represented by a solid line. The Standard & Poor's 500
Index (the "S&P 500") is represented by a dotted line. The line graph is a
visual representation of a comparison of change in value of a $10,000
hypothetical investment in the Class B Shares of the fund and the S&P 500. The
"x" axis reflects computation periods from 12/2/96 (start of performance) to
8/31/99. The "y" axis reflects the cost of the investment. The right margin
reflects the ending value of the hypothetical investment in the fund's Class B
Shares, based on a 4.00% contingent deferred sales load, as compared to the S&P
500. The ending values were $16,571 and $18,215, respectively. The legend in the
bottom quadrant of the graphic presentation indicates the fund's Class B Shares
Average Annual Total Returns for the one-year and start of performance periods
ended 8/31/99. The total returns were 31.85%, and 20.18%, respectively.
2. The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Hibernia
Louisiana Municipal Income Fund based on a 4.50% sales load are represented by a
solid line. The Lehmen Ten Year Insured Index (the "LTYII") is represented by a
dotted line. The line graph is a visual representation of a comparison of change
in value of a $10,000 hypothetical investment in the fund and the LTYII. The "x"
axis reflects computation periods from 8/31/89 to 8/31/99. The "y" axis reflects
the cost of the investment. The right margin reflects the ending value of the
hypothetical investment in the fund, based on a 4.50% sales load, as compared to
the LTYII. The ending values were $18,452 and $20,474, respectively. The legend
in the bottom quadrant of the graphic presentation indicates the fund's Average
Annual Total Returns for the one-year, five-year and 10-year periods ended
8/31/99. The total returns were (3.04%), 5.22%, and 6.49%, respectively.
3A. The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class A
Shares of Hibernia Mid Cap Equity Fund based on a 4.50% sales load are
represented by a solid line. The Standard & Poor's 400 Index (the "S&P 400") is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the Class
A Shares of the fund and the S&P 400. The "x" axis reflects computation periods
from 8/31/89 to 8/31/99. The "y" axis reflects the cost of the investment. The
right margin reflects the ending value of the hypothetical investment in the
fund's Class A Shares, based on a 4.50% sales load, as compared to the S&P 400.
The ending values were $36,345 and $44,591, respectively. The legend in the
bottom quadrant of the graphic presentation indicates the fund's Class A Shares
Average Annual Total Returns for the one-year, five-year and 10-year periods
ended 8/31/99. The total returns were 33.22%, 19.66%, and 14.30%, respectively.
3B. The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Class B
Shares of Hibernia Mid Cap Equity Fund based on a 4.50% contingent deferred
sales load are represented by a solid line. The Standard & Poor's 400 Index (the
"S&P 400") is represented by a dotted line. The line graph is a visual
representation of a comparison of change in value of a $10,000 hypothetical
investment in the Class B Shares of the fund and the S&P 400. The "x" axis
reflects computation periods from 7/13/98 (start of performance) to 8/31/99. The
"y" axis reflects the cost of the investment. The right margin reflects the
ending value of the hypothetical investment in the fund's Class B Shares, based
on a 4.50% contingent deferred sales load, as compared to the S&P 400. The
ending values were $10,840and $11,074, respectively. The legend in the bottom
quadrant of the graphic presentation indicates the fund's Class B Shares Average
Annual Total Returns for the one-year and start of performance periods ended
8/31/99. The total returns were 33.37% and 7.35%, respectively.
4. The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Hibernia
Total Return Bond Fund based on a 4.50% sales load are represented by a solid
line. The Salomon Brothers Broad Investment Grade Bond Index (the "SBBIGBI") is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the fund
and the SBBIGBI. The "x" axis reflects computation periods from 11/2/92 (start
of performance) to 8/31/99. The "y" axis reflects the cost of the investment.
The right margin reflects the ending value of the hypothetical investment in the
fund, based on a 4.50% sales load, as compared to the SBBIGBI. The ending values
were $13,913 and $15,589, respectively. The legend in the bottom quadrant of the
graphic presentation indicates the fund's Average Annual Total Returns for the
one-year, five-year and start of performance periods ended 8/31/99. The total
returns were (3.05%), 5.53%, and 5.18%, respectively.
5. The graphic presentation here displayed consists of a line graph. The
corresponding components of the line graph are listed underneath. The Hibernia
U.S. Government Income Fund based on a 4.50% sales load are represented by a
solid line. The Salomon Brothers Medium Term Broad Index (the "SBMTBI") is
represented by a dotted line. The line graph is a visual representation of a
comparison of change in value of a $10,000 hypothetical investment in the fund
and the SBMTBI. The "x" axis reflects computation periods from 8/31/89 to
8/31/99. The "y" axis reflects the cost of the investment. The right margin
reflects the ending value of the hypothetical investment in the fund, based on a
4.50% sales load, as compared to the SBMTBI. The ending values were $18,605 and
$21,174, respectively. The legend in the bottom quadrant of the graphic
presentation indicates the fund's Average Annual Total Returns for the one-year,
five-year and 10-year periods ended 8/31/99. The total returns were (2.61%),
5.65%, and 6.57%, respectively.
