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[LOGO OF FIFTH THIRD FUNDS]
[PICTURE]
Fifth Third Funds
Money Market Mutual Fund U.S. TREASURY MONEY MARKET FUND
Institutional Shares
For Customers of 1st Source Bank Only
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Prospectus
November 30, 1999
The Securities and Exchange Commission has not approved or disapproved the
shares described in this prospectus or determined whether this prospectus
is accurate or complete. Any representation to the contrary is a criminal
offense.
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Fifth Third Funds Table of Contents
<TABLE>
<CAPTION>
Objectives, Strategies and Risks
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<S> <C>
3 Overview
4 Fifth Third U.S. Treasury Money Market
Fund
<CAPTION>
Shareholder Fees and Fund Expenses
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<S> <C>
6 Fee Table
6 Expense Example
<CAPTION>
Additional Information About the Fund's
Investments
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<S> <C>
7
<CAPTION>
Fund Management
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<S> <C>
9 Investment Advisor
9 Fund Administration
<CAPTION>
Shareholder Information
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<S> <C>
10 Purchasing and Selling Fund Shares
10 Purchasing and Adding to Your Shares
11 Selling Your Shares
11 Exchanging Your Shares
12 Dividends and Capital Gains
12 Taxation
<CAPTION>
Financial Highlights
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<S> <C>
13
<CAPTION>
Back Cover
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<S> <C>
Where to learn more about Fifth Third
Funds
</TABLE>
2
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Objectives, Strategies and Risks
Overview
This section provides important information about Fifth Third U.S. Treasury
Money Market Fund (the "Fund"), a separate series of Fifth Third Funds (the
"Trust"), including:
. the investment objective
. principal investment strategies
. principal risks, and
. volatility and performance information
The Fund is managed by Fifth Third Bank.
3
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Fifth Third U.S. Treasury Money Market Fund
[LOGO]
Fundamental Stability of principal and current income consistent with
Objective stability of principal.
Principal The Fund manages its portfolio subject to strict SEC
Investment guidelines, which are designed so that the Fund may
Strategies maintain a stable $1.00 per share price, although there is
no guarantee that it will do so. All of the Fund's
investments are expected to mature in the short-term and
the dollar-weighted average portfolio maturity of the Fund
may not exceed 90 days.
The Fund invests at least 95% of its total assets in high-
quality securities called "first tier" securities. These
generally will be short-term obligations issued by the
U.S. Treasury, which are guaranteed as to principal and
interest by the U.S. Government.
The Fund reserves the right to invest up to 5% of its
portfolio in "second tier" securities, which generally are
corporate securities that, at the time of purchase, are
rated by such firms as Standard & Poor's and Moody's in
their second highest short-term major rating categories,
or unrated securities that are considered equivalent by
the Fund's investment manager. Some corporate securities
purchased by the Fund may be restricted securities, that
is, they may be subject to limited resale rights.
Principal The Fund's principal risks are those risks that could
Investment Risks affect the overall yield of the Fund and thus, the return
on your investment. They include factors that cause short-
An investment in term interest rates to decline, such as a weak economy,
the Fund is not strong equity markets and changes by the Federal Reserve
a deposit of in its monetary policies.
Fifth Third Bank
or any other
bank and is not
insured or
guaranteed by
the FDIC or any
other government
agency. Although
the Fund seeks
to preserve the
value of your
investment at
$1.00 per share,
it is possible
to lose money by
investing in
this Fund.
4
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Fifth Third U.S. Treasury Money Market Fund
[LOGO]
Volatility and Performance Information
The bar chart and table provide an indication of the risks of an investment in
the Fund by showing its performance from year to year and over time.
The returns assume that Fund distributions have been reinvested. The table
assumes that Shareholders redeem their Fund shares at the end of the period
indicated.
Past performance does not indicate how the Fund will perform in the future.
[CHART]
Year-by-Year Total Returns as of 12/31 For Institutional Shares
1990 7.84
1991 5.67
1992 3.39
1993 2.74
1994 3.79
1995 5.57
1996 5.05
1997 5.25
1998 5.12
The bar chart above does not reflect the impact of any applicable sales charges
or account fees, which would reduce returns.
<TABLE>
<S> <C> <C>
Best quarter: Q2 1990 1.93%
Worst quarter: Q4 1993 0.67%
Year to Date Return (1/1/99 to 9/30/99): 3.40%
</TABLE>
Average Annual Total Returns (for the periods ended December 31, 1998)
<TABLE>
<CAPTION>
Inception Date Past Year Past 5 Years Past 10 Years Since Inception
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<S> <C> <C> <C> <C> <C>
Institutional Shares 12/1/89 5.12% 4.95% N/A 4.96%
</TABLE>
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For current yield information, call 1-888-799-5353.
5
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Shareholder Fees and Fund Expenses
Fee Table
This table describes the fees and expenses that you may pay if you buy and hold
Institutional shares of the Fund.
Shareholder fees are paid by you at the time you purchase or sell your shares.
Annual Fund operating expenses are paid out of Fund assets, and are reflected
in the share price. The Fund's fees and expenses are based upon the Fund's
operating expenses for the fiscal year ended July 31, 1999.
Shareholder Fees
<TABLE>
<CAPTION>
Fifth Third
U.S. Treasury
Money Market
Fund
<S> <C>
Maximum Sales Charge (Load) Imposed
on Purchases None
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Maximum Sales Charge (Load) Imposed
on Reinvested Dividends None
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Maximum Deferred Sales Load None
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Annual Fund Operating Expenses
(as a percentage of average net
assets)
Management fees 0.40%
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Distribution (12b-1) fees None
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Other expenses 0.22%
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Total Annual Fund Operating Expenses 0.62%
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Because some of the Fund's expenses have been reduced through expense waivers
and reimbursements, actual total operating expenses for the prior year would
have been as shown below.
Net Total Annual Fund Operating
Expenses 0.38%
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</TABLE>
Expense Example
Use the table below to compare fees and expenses with the fees and expenses of
other mutual funds. The table illustrates the amount of fees and expenses you
and the Fund would pay, assuming a $10,000 initial investment, 5% annual
return, payment of maximum sales charges, and no changes in the Fund's
operating expenses. Amounts are presented assuming redemption at the end of
each period. Because these examples are hypothetical and for comparison only,
your actual costs may be different.
<TABLE>
<CAPTION>
Fifth Third U.S.
Treasury 1 3 5 10
Money Market Fund Year Years Years Years
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<S> <C> <C> <C> <C>
Institutional Shares $63 $199 $346 $774
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</TABLE>
6
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Additional Information About the Fund's Investments
The primary investments and investment strategies of the Fund are described
above. Below are descriptions of some additional investments and strategies of
the Fund, some of their risks as well as other risks of investing in the Fund.
A list of the Fund's investments is included in the Fund's most recent annual
or semi-annual report to shareholders. Please note, though, that the Fund may
adjust the composition of its portfolio as market and economic conditions
change.
The success of achieving the Fund's investment strategy depends on Fifth Third
Bank's ability to assess the potential of the securities in which the Fund
invests as well as to evaluate and anticipate changing economic and market
conditions.
Foreign Foreign bonds and instruments of foreign banks generally
Investments have more risk than their domestic counterparts, in part
because of higher political and economic risks and the
general lack of reliable information. All foreign
securities purchased by the Fund are denominated in U.S.
dollars.
Securities When securities are rated by one or more independent
Ratings rating agencies, the Fund uses these ratings to determine
credit quality. In cases where a security has received a
rating from only one independent rating agency, it may
rely on that rating. If a security has received ratings
from two or more rating agencies and at least two of the
ratings are equivalent, the Fund may rely on the two
equivalent ratings even if the other ratings are lower. In
cases where a security's two highest ratings are in
conflicting categories, the Fund must follow the lower
rating. If a security is unrated, the Fund may assign it
to a given category based on its own credit research.
Repurchase The Fund may enter into repurchase agreements. A
Agreements repurchase agreement is an agreement in which the Fund
buys securities from a bank or other financial institution
and agrees to sell it back at a specified time and place.
The risks of repurchase agreements include the risk that a
counterparty will not buy back the securities as required
and the securities decline in value. To mitigate those
risks, the Fund intends to enter repurchase agreements
only with high quality counterparties and purchase only
high quality, short-term debt securities.
Restricted and Any securities that are thinly traded or whose resale is
Illiquid restricted can be difficult to sell at a desired time and
Securities price. Some of those securities are new and complex, and
trade only among institutions; the markets for these
securities are still developing and may not function as
efficiently as established markets. Owning a large
percentage of restricted or illiquid securities could
hamper the Fund's ability to raise cash in order to meet
redemptions. Also, because there may not be an established
market price for these securities, the Fund may have to
estimate their value, which means that their valuation may
have a subjective element.
Derivatives Derivatives are financial instruments whose value derives
from one or more securities. Certain instruments that are
"first" or "second tier" securities also may be
derivatives, such as short-term, high-quality asset-backed
securities. The Fund uses derivatives to invest for
potential income, and may purchase them to the extent it
can purchase any other type of "first" or "second tier"
security. The values of some derivatives are difficult to
determine because they are based on the values of other
securities and the markets for some derivatives may be
limited. With some derivatives, such as certain option
contracts, there is also the risk that the counterparty
may fail to honor its contract terms, causing a loss for
the Fund.
7
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Additional Information About the Fund's Investments
When-Issued The Fund may invest in securities prior to their date of
Securities issue. These securities could fall in value by the time
they are actually issued, which may be any time from a few
days to over a year.
Year 2000 Fifth Third Bank and BISYS Fund Services Limited
Partnership ("BISYS"), the Fund's administrator, do not
currently anticipate that computer problems related to the
year 2000 will have a material effect on the Fund. There
can be no assurances in this area, however, and although
Fifth Third Funds and BISYS have undertaken significant
projects to minimize the risk of year 2000 computer
problems, some factors, including the year 2000 compliance
of the Trust's and BISYS's suppliers, are not within their
direct control and could negatively affect communications
systems, investment markets or the economy in general.
8
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Fund Management
Investment Advisor
Fifth Third Bank, 38 Fountain Square Plaza, Cincinnati, Ohio 45263, serves as
investment advisor to the Fund.
As of September 30, 1999, Fifth Third Bank had approximately $18 billion of
assets under management, including approximately $4.6 billion of assets of
Fifth Third Funds.
The management fee paid by the Fund for the fiscal year ended July 31, 1999 was
as follows:
<TABLE>
<CAPTION>
As a percentage of
average net assets
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<S> <C>
Fifth Third U.S. Treasury Money Market Fund 0.26%
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</TABLE>
Fund Administration
BISYS serves as the administrator of the Fund. The administrator generally
assists in all aspects of the Fund's administration and operation, including
providing the Fund with certain administrative personnel and services necessary
to operate the Fund, such as legal and accounting services. BISYS provides
these at an annual rate as specified below.
<TABLE>
<CAPTION>
Maximum Average Aggregate Daily
Administrative Fee Net Assets of the Trust
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<S> <C>
0.20% of the first $1 billion
0.18% of the next $1 billion
0.17% in excess of $2 billion
</TABLE>
BISYS may periodically waive all or a portion of its administrative fee which
will cause the yield of the Fund to be higher than it would otherwise be in the
absence of such a waiver.
Pursuant to a separate agreement with BISYS, Fifth Third Bank performs sub-
administrative services on behalf of the Fund, including providing certain
administrative personnel and services necessary to operate the Fund. Fifth
Third Bank receives a fee from BISYS for providing sub-administrative services
at an annual rate of 0.025% of the average aggregate daily net assets of the
Fund.
9
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Shareholder Information
Purchasing and Selling Fund Shares
Pricing Fund Shares
The price of the Fund's shares is based on the Fund's Net Asset Value (NAV).
The value of each portfolio instrument held by the Fund is determined by using
amortized cost.
Fifth Third U.S. Treasury Money Market Fund calculates its NAV at 1 p.m.
Cincinnati time. The Fund's NAV is calculated each day the New York Stock
Exchange is open for regular trading and the Federal Reserve Bank of Cleveland
is open for business. The Fund will be closed on those days that Fifth Third
Bank is closed and on the following holidays: New Year's Day, Martin Luther
King Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Columbus Day, Veterans' Day, Thanksgiving Day and Christmas.
Purchasing and Adding to Your Shares
You may purchase shares on days when the New York Stock Exchange is open for
regular trading and the Federal Reserve Bank of Cleveland is open for business.
Your purchase price will be the next NAV after your purchase order, completed
application and full payment have been received by the Fund or its transfer
agent. All orders must be received by the Fund or its transfer agent by 1 p.m.
(Cincinnati time) in order to receive that day's NAV.
Institutional Shares may be purchased through broker-dealers, investment
advisers, financial planners or other financial institutions which have an
agreement with Fifth Third Bank to place trades for themselves or their clients
for a fee. In order to purchase Institutional shares through one of those
entities, you must have an account with it. That account will be governed by
its own rules and regulations, which may be more stringent than the rules and
regulations governing an investment in the Fund, and you should consult your
account documents for full details. Your shares in the Fund may be held in an
omnibus account in the name of that institution.
The entity through which you are purchasing your shares is responsible for
transmitting the order to the Fund, and it may have an earlier cut-off time for
purchase requests. Consult that entity for specific information. If your
purchase order has been received by the Fund prior to the time designated by
the Fund for receiving orders, you will receive the dividend declared for that
day.
All purchases must be in U.S. dollars. A fee may be
charged for any checks that do not clear. Third-party
checks are not accepted.
For details, call 1-800-552-2378.
The Fund may reject a purchase order for any reason.
Minimum
Investments
The minimum initial investment in Institutional Shares of
the Fund offered by this Prospectus is $1,000. Subsequent
investments must be in amounts of at least $50. An
institutional investor's minimum investment will be
calculated by combining all accounts it maintains with the
Trust.
Avoid 31% Tax Withholding
The Fund is required to withhold 31% of taxable dividends, capital gains
distributions and redemptions paid to any shareholder who has not provided the
Fund with his or her certified Taxpayer Identification Number (your Social
Security Number for individual investors) in compliance with IRS rules. To
avoid this withholding, make sure you provide your correct Tax Identification
Number.
10
<PAGE>
Shareholder Information
Selling Your Shares
You may sell your shares on days when the New York Stock Exchange is open for
regular trading and the Federal Reserve Bank of Cleveland is open for business.
Your sales price will be the next NAV after your sell order is received by the
Fund, its transfer agent, or your investment representative. All orders must be
received by the Fund or its transfer agent prior to the time the Fund
calculates its NAV in order to receive that day's NAV. If your order has been
received by the Fund prior to the time the Fund calculates its NAV, and your
shares have been sold you will not receive the dividend declared for that day.
Normally you will receive your proceeds within a week after your request is
received.
In order to sell your shares, call the broker-dealer, investment adviser,
financial planner or other institution through which you purchased your shares.
Postponement of Redemption Payments
The Fund may delay sending to you redemption proceeds for up to 7 days, or
longer if permitted by the SEC. If you experience difficulty making a telephone
redemption during periods of drastic economic or market change, you can send
your request to the broker-dealer, investment adviser, financial planner or
other institution through which you purchased your shares.
Closing of Small Accounts
If your account falls below $1,000 because of redemptions, the Fund may ask you
to increase your balance. If it is still below the minimum after 30 days, the
Fund may close your account and send you the proceeds at the current NAV.
Exchanging Your Shares
You may exchange Instructions for Exchanging Shares
your Fund shares
for Institutional To exchange your shares, call the broker-dealer,
shares of any investment adviser, financial planner or other
other Fund of the institution through which you purchased your shares for
Trust. No exchange procedures or call 1-800-552-2378.
transaction fees
are charged for Notes on Exchanges
exchanges. Be
sure to read the To prevent disruption in the management of the Fund,
Prospectus market timing strategies and frequent exchange activity
carefully of any may be limited by the Fund. Although not anticipated, the
Fund into which Fund may reject exchanges, or change or terminate rights
you wish to to exchange shares at any time.
exchange shares.
Shares of the new Fund must be held under the same
You must meet the account names with the same registration and tax
minimum identification numbers, as the shares of the old Fund.
investment
requirements for The Exchange Privilege (including automatic exchanges)
the Fund into may be changed or eliminated at any time.
which you are
exchanging. The exchange privilege is available only in states where
Exchanges from shares of the Fund may be sold.
one Fund to
another are All exchanges are based on the relative net asset value
taxable for next determined after the exchange order is received by
investors subject the Fund.
to federal or
state income
taxation.
11
<PAGE>
Shareholder Information
Dividends and Capital Gains
All dividends and capital gains will be automatically reinvested unless you
request otherwise. You can receive them in cash or by electronic funds transfer
to your bank account if you are not a participant in an IRA account or in a tax
qualified plan. There are no sales charges for reinvested distributions.
Dividends, if any, are declared daily and paid monthly. Capital gains, if any,
are distributed at least annually. The Fund does not expect to pay any capital
gains.
Taxation
Federal Income Tax
The Fund expects to distribute substantially all of its investment income
(including net capital gains and tax-exempt interest income, if any) to its
shareholders. Unless otherwise exempt, shareholders are required to pay federal
income tax on any dividends and other distributions, including capital gains
distributions received. This requirement applies whether dividends and other
distributions are received in cash or as additional shares. No federal income
tax is due on any dividend earned in an IRA or qualified retirement plan until
distributed.
This is a brief summary of certain federal income tax consequences relating to
an investment in the Fund, and shareholders are urged to consult their own tax
advisors regarding the taxation of their investments under federal, state and
local laws.
12
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Financial Highlights
The financial highlights table is intended to help you understand the Fund's
financial performance for the past 5 years or the period of the Fund's
operations, if shorter. Certain information reflects financial results for a
single Fund share. The total returns in the table represent the rate that an
investor would have earned or lost on an investment in the Fund (assuming
reinvestment of all dividends and distributions). This information has been
audited by Ernst & Young LLP, whose report, along with the Fund's financial
statements, are included in the Fund's annual report, which is available upon
request.
<TABLE>
<CAPTION>
Year Ended July 31,
------------------------------------------------
1999 1998 1997 1996 1995
Per share data -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
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Income from investment
operations
Net investment income 0.05 0.05 0.05 0.05 0.05
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Total from investment
operations 0.05 0.05 0.05 0.05 0.05
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Less distributions
Distributions to shareholders
from net investment income (0.05) (0.05) (0.05) (0.05) (0.05)
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Total distributions (0.05) (0.05) (0.05) (0.05) (0.05)
================================================================================
Net asset value, end of the
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
================================================================================
Total return 4.68% 5.31% 5.11% 5.24% 5.18%
================================================================================
Ratios/Supplemental Data
Ratios to Average Net Assets
Expenses 0.38% 0.38% 0.42% 0.43% 0.44%
Net investment income 4.57% 5.19% 5.00% 5.10% 5.07%
Expense waiver/reimbursement
(a) 0.24% 0.24% 0.17% 0.12% 0.11%
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Supplemental data
Net assets, end of period
(000s) $856,286 $876,089 $539,087 $489,228 $321,640
================================================================================
</TABLE>
(a) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
13
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The following additional information is available to you upon request and
without charge.
Annual/Semiannual Reports (Reports):
The Funds' annual and semi-annual reports to shareholders contain additional
information on the Funds' investments.
Statement of Additional Information (SAI): The SAI provides more detailed
information about the Funds, including their operations and investment
policies. It is incorporated by reference and is legally considered a part of
this prospectus.
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You can get free copies of Annual and Semi-annual Reports, the SAI, prospectuses
of other Fifth Third Funds, or request other information and discuss your
questions about the Funds by contacting a broker or other financial institution
that sells the Funds. In addition, you may contact the Funds at:
Fifth Third Funds
c/o Fifth Third Bank
38 Fountain Square Plaza
Cincinnati, Ohio 45263
Telephone: 1-888-799-5353
Internet: http://www.53.com*
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*The Funds' website is not part of this Prospectus.
You can review the Annual and Semi-Annual Reports and the SAI at the Public
Reference Room of the Securities and Exchange Commission. You can get copies:
. For a fee, by writing the Public Reference Section of the Commission,
Washington, D.C. 20549-6009 or calling 1-800-SEC-0330.
. At no charge from the Commission's Website at http://www.sec.gov.
[LOGO OF FIFTH THIRD FUNDS]
Investment Company Act file no. 811-5669
