CITIFUND(SM)
- --------------------
PREMIUM
LIQUID RESERVES
SEMI-ANNUAL REPORT
FEBRUARY 29, 2000
CITIFUNDS
- --------------------------------------------------------------------------------
INVESTMENT PRODUCTS: NOT FDIC INSURED o NO BANK GUARANTEE o MAY LOSE VALUE
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Letter to Our Shareholders 1
................................................................................
Portfolio Environment and Outlook 2
................................................................................
Fund Facts 3
................................................................................
Fund Performance 4
................................................................................
CITIFUNDS PREMIUM LIQUID RESERVES
Statement of Assets and Liabilities 5
................................................................................
Statement of Operations 6
................................................................................
Statement of Changes in Net Assets 7
................................................................................
Financial Highlights 8
................................................................................
Notes to Financial Statements 9
................................................................................
CASH RESERVES PORTFOLIO
Portfolio of Investments 12
................................................................................
Statement of Assets and Liabilities 15
................................................................................
Statement of Operations 16
................................................................................
Statement of Changes in Net Assets 17
................................................................................
Financial Highlights 18
................................................................................
Notes to Financial Statements 19
................................................................................
<PAGE>
LETTER TO OUR SHAREHOLDERS
Dear Shareholder:
Rising interest rates during the reporting period have benefited money market
investors, who earned higher yields while preserving capital. The Federal
Reserve Board (the "Fed") raised interest rates three times in 1999 and most
recently on February 2, 2000, for a total increase of 100 basis points. (A basis
point is .01% or one one-hundredth of a percent.) The Fed's actions were
implemented to forestall a reacceleration of inflation, a potential consequence
of the continued robust growth of the U.S. economy.
In this environment, the CitiFunds' investment adviser, Citibank, N.A.,
continued to manage CitiFunds Premium Liquid Reserves with the goal of achieving
its investment objective: providing liquidity and as high a level of current
income as is consistent with the preservation of capital.
This report reviews the Fund's investment activities and performance during
the six months ended February 29, 2000, and provides a summary of Citibank's
perspective on and outlook for the money market securities marketplace.
Thank you for your continued confidence and participation.
Sincerely,
/s/ Philip W. Coolidge
- ----------------------
Philip W. Coolidge
President
March 15, 2000
1
<PAGE>
PORTFOLIO ENVIRONMENT AND OUTLOOK
THE PAST SIX MONTHS HAVE BEEN GENERALLY REWARDING FOR MANY MONEY MARKET
INVESTORS. Yields on most money market securities ended the six-month reporting
period higher than where they began, reflecting the general trend of higher
short-term interest rates in a period of rising interest rates.
The economic conditions that led to higher rates during the reporting period
included strong U.S. economic growth, low inflation, robust consumer spending
and rising demand for U.S. exports. Even concerns regarding potential
Y2K-related problems did not cause the rate of economic growth to moderate
significantly.
As a result of these influences, many investors became concerned that
unsustainable economic growth might cause long-dormant inflationary pressures to
resurface. In an attempt to forestall a potential reacceleration of inflation,
the Fed raised interest rates three 25-basis point increments during 1999 and
raised rates an additional 25 basis points on February 2, 2000.
THE FUND'S MANAGERS' PRIMARY STRATEGY DURING MOST OF THE SIX-MONTH PERIOD WAS
TO ACTIVELY MANAGE THE FUND'S AVERAGE MATURITY according to their outlook
regarding the direction of interest rates and prevailing yields among money
market instruments of different maturities. (Maturity is the date on which the
principal amount of a note, draft, acceptance bond or other debt instrument
becomes due and payable.) When the six-month reporting period began, the
managers maintained the Fund's neutral average maturity, striking a balance
between the need for flexibility during a period of rising interest rates while
purchasing securities they believed to be of compelling values. Toward the end
of 1999, the Fund's average maturity was reduced in order to enhance liquidity
and keep assets available for higher-yielding securities as they became
available.
Beginning in the middle of January 2000, the Fund's managers began to
gradually extend the Fund's average maturity to take advantage of
higher-yielding opportunities among money market instruments with moderately
longer maturities. As of February 29, 2000, the Fund's average maturity was 85
days.
ADDITIONALLY, THE MANAGERS ACTIVELY MANAGED THE MIX OF MONEY MARKET
INSTRUMENTS WITHIN THE PORTFOLIO. As interest rates rose, commercial paper and
bank certificates of deposit represented the most attractive values, in the
managers' opinion. For example, toward year-end 1999, the managers shifted
assets to high quality, U.S. dollar-denominated CDs issued by foreign banks
(known as Yankee CDs) in order to capture higher yields. On the other hand, the
managers generally avoided U.S. Treasury bills, which offered relatively low
yields throughout the six-month period.
Looking forward, the Fund's managers believe that investors are expecting
more rate hikes from the Fed, and that future increases have already been
incorporated in the yields of money market securities. Accordingly, THE FUND'S
MANAGERS BELIEVE THAT OVER THE LONGER TERM, INTEREST RATES MAY BEGIN TO DECLINE
IF THE U.S. ECONOMY BEGINS TO SHOW EVIDENCE THAT IT IS MODERATING. Therefore,
the managers are carefully looking for opportunities to take advantage of
changes in interest rates, including possibly extending the Fund's average
maturity further to lock in higher yields when deemed appropriate.
2
<PAGE>
FUND FACTS
FUND OBJECTIVE
To provide its shareholders with liquidity and as high a level of current income
as is consistent with the preservation of capital.
INVESTMENT ADVISER DIVIDENDS
CASH RESERVES PORTFOLIO Declared daily, paid monthly
Citibank, N.A.
COMMENCEMENT OF OPERATIONS BENCHMARKS*
May 3, 1990 o Lipper Taxable Money Market
Funds Average
NET ASSETS AS OF 2/29/00 o IBC Financial Data 1st Tier Taxable
$861.2 million Money Market Funds Average
* Lipper Funds Average and IBC Funds Average reflect the performance (excluding
sales charges) of mutual funds with similar objectives.
3
<PAGE>
FUND PERFORMANCE
TOTAL RETURNS
ALL PERIODS ENDED FEBRUARY 29, 2000 SIX ONE FIVE MAY 3, 1990
(Unaudited) MONTHS** YEAR YEARS* INCEPTION*
================================================================================
CitiFunds Premium Liquid Reserves 2.66% 5.13% 5.39% 5.09%
Lipper Taxable Money Market Funds Average 2.42% 4.63% 4.94% 4.63%+
IBCFinancial Data 1st Tier
Taxable Money Market Funds Average 2.49% 4.73% 4.98% 4.73%+
* Average Annual Total Return
** Not Annualized
+ From 4/30/90
7-DAY YIELDS
Annualized Current 5.51%
Effective 5.66%
The ANNUALIZED CURRENT 7-DAY YIELD reflects the amount of income generated by
the investment during that seven-day period and assumes that the income is
generated each week over a 365 day period. The yield is shown as a percentage of
the investment.
The EFFECTIVE 7-DAY YIELD is calculated similarly, but when annualized the
income earned by the investment during that seven-day period is assumed to be
reinvested. The effective yield is slightly higher than the current yield
because of the compounding effect of this assumed reinvestment.
Note: A money market fund's yield more closely reflects the current earnings of
the fund than does the total return.
COMPARISON OF 7-DAY YIELDS FOR CITIFUNDS PREMIUM LIQUID RESERVES VS. IBC
FINANCIAL DATA 1ST TIER TAXABLE MONEY MARKET FUNDS AVERAGE
As illustrated, CitiFunds Premium Liquid Reserves generally provided a higher
annualized seven-day yield to that of a comparable IBC Financial Data Money
Market Funds Average, as published in IBC Money Fund Report(TM), for the one
year period.
[The figures below represent the chart in the printed piece]
3/2/99 4.69 4.34
4.71 4.27
4.67 4.25
4.67 4.24
4.66 4.22
4.69 4.22
4.69 4.25
4.64 4.21
4.63 4.2
4.61 4.19
4.68 4.21
4.61 4.19
5/25/99 4.65 4.18
4.62 4.18
4.65 4.22
4.6 4.21
4.64 4.22
4.64 4.22
4.69 4.26
4.83 4.31
4.75 4.33
4.8 4.36
4.82 4.38
4.84 4.41
4.81 4.41
8/24/99 4.85 4.45
4.86 4.48
4.99 4.55
5 4.58
5 4.6
5.05 4.63
5.06 4.65
5.1 4.67
5.07 4.7
5.11 4.73
5.12 4.76
5.21 4.8
5.2 4.8
5.26 4.86
11/30/99 5.33 4.91
5.4 4.97
5.38 5
5.39 5.06
5.42 5.12
5.4 5.15
5.28 5.05
5.4 5.15
5.42 5.13
5.41 5.1
5.42 5.11
5.41 5.12
5.46 5.16
2/29/00 5.48 5.16
5.51 5.19
Note: Mutual Fund shares are not guaranteed or insured by the Federal Deposit
Insurance Corporation or any other government agency. Yields and total returns
will fluctuate and past performance is no guarantee of future results. Total
return figures include reinvestment of dividends. Returns and yields reflect
certain voluntary fee waivers. If the waivers were not in place, the Fund's
returns and yields would have been lower.
4
<PAGE>
CITIFUNDS PREMIUM LIQUID RESERVES
STATEMENT OF ASSETS AND LIABILITIES
FEBRUARY 29, 2000 (Unaudited)
================================================================================
ASSETS:
Investment in Cash Reserves Portfolio, at value (Note 1A) $863,604,155
- --------------------------------------------------------------------------------
LIABILITIES:
Dividends payable 1,834,243
Payable for shares of beneficial interest repurchased 310,610
Payable to affiliate-Shareholder servicing agents' fees (Note 3B) 71,281
Accrued expenses and other liabilities 168,790
- --------------------------------------------------------------------------------
Total liabilities 2,384,924
- --------------------------------------------------------------------------------
NET ASSETS for 861,219,231 shares of beneficial interest
outstanding $861,219,231
================================================================================
NET ASSETS CONSIST OF:
Paid-in capital $861,219,231
================================================================================
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE $1.00
================================================================================
See notes to financial statements
5
<PAGE>
CITIFUNDS PREMIUM LIQUID RESERVES
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED FEBRUARY 29, 2000 (Unaudited)
================================================================================
INVESTMENT INCOME (Note 1B):
Income from Cash Reserves Portfolio $24,543,754
Allocated expenses from Cash Reserves Portfolio (431,410)
- --------------------------------------------------------------------------------
$24,112,344
EXPENSES:
Administrative fees (Note 3A) 1,509,556
Shareholder Servicing Agents' fees (Note 3B) 431,302
Distribution fees (Note 4) 431,302
Registration fees 17,768
Legal fees 14,666
Custody and fund accounting fees 10,483
Shareholder reports 8,559
Trustees' fees 8,420
Audit fees 6,300
Transfer agent fees 5,929
Miscellaneous 3,805
- --------------------------------------------------------------------------------
Total expenses 2,448,090
Less aggregate amount waived or assumed by
Administrator and Distributor (Notes 3A and 4) (1,156,763)
- --------------------------------------------------------------------------------
Net expenses 1,291,327
- --------------------------------------------------------------------------------
Net investment income $22,821,017
================================================================================
See notes to financial statements
6
<PAGE>
CITIFUNDS PREMIUM LIQUID RESERVES
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED
FEBRUARY 29, 2000 YEAR ENDED
(Unaudited) AUGUST 31, 1999
================================================================================
FROM INVESTMENT ACTIVITIES:
Net investment income, declared as dividends
to shareholders (Note 2) $ 22,821,017 $ 37,972,067
================================================================================
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST AT
NET ASSET VALUE OF $1.00 PER SHARE (Note 5):
Proceeds from sale of shares 1,968,298,791 4,282,425,929
Net asset value of shares issued to shareholders
from reinvestment of dividends 10,954,439 17,030,134
Cost of shares repurchased (1,913,358,253) (4,115,401,408)
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS 65,894,977 184,054,655
- --------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 795,324,254 611,269,599
- --------------------------------------------------------------------------------
End of period $ 861,219,231 $ 795,324,254
================================================================================
See notes to financial statements
7
<PAGE>
CITIFUNDS PREMIUM LIQUID RESERVES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
FEBUARY 29, 2000 YEAR ENDED AUGUST 31,
------------------------------------------------------
(Unaudited) 1999 1998 1997 1996 1995
===================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning
of period $1.00000 $1.00000 $1.00000 $1.00000 $1.00000 $1.00000
Net investment income 0.02635 0.04836 0.05348 0.05240 0.05322 0.05465
Less dividends from net
investment income (0.02635) (0.04836) (0.05348) (0.05240) (0.05322) (0.05465)
- ---------------------------------------------------------------------------------------------------
Net Asset Value, end of period $1.00000 $1.00000 $1.00000 $1.00000 $1.00000 $1.00000
===================================================================================================
RATIOS/SUPPLEMENTAL DATA:
Net Assets, end of period
(000's omitted) $861,219 $795,324 $611,270 $387,910 $380,303 $423,992
Ratio of expenses to average
net assets+ 0.40%* 0.40% 0.40% 0.40% 0.40% 0.40%
Ratio of net investment income
to average net assets+ 5.29%* 4.84% 5.39% 5.25% 5.35% 5.47%
Total return 2.66%** 4.94% 5.48% 5.37% 5.45% 5.60%
Note: If agents of the Fund and agents of Cash Reserves Portfolio had not waived
all or a portion of their fees during the periods indicated, the net investment
income per share and the ratios would have been as follows:
Net investment income
per share $0.02438 $0.04457 $0.04950 $0.04833 $0.04911 $0.05047
RATIOS:
Expenses to average net assets+ 0.79%* 0.79% 0.80% 0.81% 0.82% 0.83%
Net investment income to
average net assets+ 4.90%* 4.45% 4.99% 4.84% 4.93% 5.04%
===================================================================================================
</TABLE>
+ Includes the Fund's share of Cash Reserves Portfolio's allocated expenses.
* Annualized.
** Not Annualized.
See notes to financial statements
8
<PAGE>
CITIFUNDS PREMIUM LIQUID RESERVES
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES CitiFunds Premium Liquid Reserves (the
"Fund") is a separate diversified series of CitiFunds Premium Trust (the
"Trust"), a Massachusetts business trust. The Trust is registered under the
Investment Company Act of 1940, as amended, as an open-end management investment
company. The Fund invests all of its investable assets in Cash Reserves
Portfolio (the "Portfolio"), a management investment company for which Citibank,
N.A. ("Citibank") serves as investment adviser. The value of such investment
reflects the Fund's proportionate interest (6.2% at February 29, 2000) in the
net assets of the Portfolio. CFBDS, Inc. ("CFBDS"), acts as the Trust's
Administrator and Distributor. Citibank also serves as Sub-Administrator and
makes shares available to cusotmers as Shareholder Servicing Agent.
The preparation of financial statements in accordance with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts and disclosures in the financial
statements. Actual results could differ from those estimates.
The financial statements of the Portfolio, including the portfolio of
investments, are contained elsewhere in this report and should be read in
conjunction with the Fund's financial statements.
The significant accounting policies consistently followed by the Fund are as
follows:
A. INVESTMENT VALUATION Valuation of securities by the Portfolio is discussed
in Note 1A of the Portfolio's Notes to Financial Statements, which are included
elsewhere in this report.
B. INVESTMENT INCOME The Fund earns income, net of Portfolio expenses, daily
based on its investment in the Portfolio.
C. FEDERAL TAXES The Fund's policy is to comply with the provisions of the
Internal Revenue Code available to regulated investment companies and to
distribute to shareholders all of its taxable income. Accordingly, no provision
for federal income or excise tax is necessary.
D. EXPENSES The Fund bears all costs of its operations other than expenses
specifically assumed by Citibank and CFBDS. Expenses incurred by the Trust with
respect to any two or more funds in the series are allocated in proportion to
the average net assets of each fund, except when allocations of direct expenses
to each fund can otherwise be made fairly. Expenses directly attributable to a
fund are charged to that fund. The Fund's share of the Portfolio's expenses are
charged against and reduce the amount of the Fund's investment in the Portfolio.
2. DIVIDENDS The net income of the Fund is determined once daily, as of 3:00
p.m. Eastern Standard Time, and all of the net income of the Fund so determined
is declared as a dividend to shareholders of record at the time of such
determination. Dividends are distributed in the form of additional shares of the
Fund or, at the election of the shareholder, in cash (subject to the policies of
the shareholder's Shareholder Servicing Agent) on or prior to the last business
day of the month.
9
<PAGE>
CITIFUNDS PREMIUM LIQUID RESERVES
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
3. ADMINISTRATIVE SERVICES PLAN The Trust has adopted an Administrative Services
Plan which provides that the Trust, on behalf of each Fund, may obtain the
services of an Administrator, one or more Shareholder Servicing Agents, and
other Servicing Agents, and may enter into agreements providing for the payment
of fees for such services. Under the Trust's Administrative Services Plan, the
aggregate of the fees paid to the Administrator from the Fund under such Plan
and of the fees paid to the Shareholder Servicing Agents from the Fund may not
exceed 0.45% of the Fund's average daily net assets on an annualized basis for
the Fund's then-current fiscal year. For the six months ended February 29, 2000,
management agreed to voluntarily limit Fund expenses to 0.40%, inclusive of
Portfolio allocated expenses.
A. ADMINISTRATIVE FEES Under the terms of an Administrative Services
Agreement, CFBDS is entitled to an administrative fee from the Fund, as
compensation for overall administrative services and general office facilities,
which is accrued daily and paid monthly at an annual rate of 0.35% of the Fund's
average daily net assets. The Administrative fees amounted to $1,509,556 of
which $725,461 was voluntarily waived for the six months ended February 29,
2000. Citibank acts as Sub-Administrator and performs certain duties and
receives compensation from CFBDS from time to time as agreed to by CFBDS and
Citibank. Citibank is a wholly-owned subsidiary of Citigroup Inc.
The Fund pays no compensation directly to any Trustee or any officer who is
affiliated with the Administrator, all of whom receive remuneration for their
services to the Fund from the Administrator or its affiliates. Certain of the
officers and a Trustee of the Fund are officers and a director of the
Administrator or its affiliates.
B. SHAREHOLDER SERVICING Agents Fees The Trust, on behalf of the Fund, has
entered into shareholder servicing agreements with each Shareholder Servicing
Agent pursuant to which that Shareholder Servicing Agent acts as an agent for
its customers and provides other related services. For their services, each
Shareholder Servicing Agent receives fees from the Fund, which may be paid
periodically, which may not exceed, on an annualized basis, an amount equal to
0.10% of the average daily net assets of the Fund represented by shares owned
during the period for which payment has been made by investors for whom such
Shareholder Servicing Agent maintains a servicing relationship. Shareholder
Servicing Agent fees amounted to $431,302 for the six months ended February 29,
2000.
10
<PAGE>
CITIFUNDS PREMIUM LIQUID RESERVES
NOTES TO FINANCIAL STATEMENTS (Unaudited)
4. DISTRIBUTION FEES The Trust has adopted a Plan of Distribution pursuant to
Rule 12b-1 under the Investment Company Act of 1940, as amended, in which the
Fund reimburses the Distributor for expenses incurred or anticipated, in
connection with the sale of shares of the Fund, at an annual rate not to exceed
of 0.10% of the Fund's average daily net assets. Distribution fees amounted to
$431,302 all of which was voluntarily waived for the six months ended February
29, 2000. The Distributor voluntarily agreed to assume all distribution expenses
through February 29, 2000.
5. 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).
6. INVESTMENT TRANSACTIONS Increases and decreases in the Fund's investment in
the Portfolio aggregated $1,256,196,367 and $1,214,591,973, respectively, for
the six months ended February 29, 2000.
11
<PAGE>
CASH RESERVES PORTFOLIO
PORTFOLIO OF INVESTMENTS February 29, 2000
(Unaudited)
PRINCIPAL
AMOUNT
ISSUER (000'S OMITTED) VALUE
- --------------------------------------------------------------------------------
ASSET BACKED -- 10.1%
- --------------------------------------------------------------------------------
Lincs-Ser,*
5.91% due 4/15/00 $100,000 $100,000,000
Restructured Asset Securities,*
5.91% due 6/02/00 250,000 250,000,000
Steers,
6.16% due 10/02/00 365,000 365,197,809
Strategic Money Market Trust Receipts,*
6.18% due 3/15/00 240,000 240,000,000
6.15% due 9/13/00 350,000 350,029,338
Strats Trust*,
5.98% due 8/18/00 100,000 100,000,000
---------------
1,405,227,147
---------------
BANK NOTES -- 7.1%
- --------------------------------------------------------------------------------
Bank of America,
6.00% due 3/13/00 125,000 125,000,000
6.46% due 11/09/00 100,000 100,000,000
6.48% due 11/20/00 50,000 50,000,000
6.18% due 11/22/00 100,000 95,433,667
FCC National Bank,
5.85% due 3/20/00 164,000 164,000,000
First USA Bank,
5.93% due 8/29/00 100,000 99,981,049
Morgan Guaranty
Trust Co,*
5.90% due 5/10/00 210,000 209,984,252
Nationsbank,
5.39% due 6/01/00 43,000 42,940,801
Westpac Banking Corp,
5.20% due 5/11/00 100,000 99,988,767
---------------
987,328,536
---------------
CERTIFICATES OF DEPOSIT (DOMESTIC) -- 1.5%
- --------------------------------------------------------------------------------
Bankers Trust Co.,*
6.01% due 5/15/00 200,000 199,981,963
---------------
CERTIFICATES OF DEPOSIT (EURO) -- 8.5%
- --------------------------------------------------------------------------------
Den Danske Bank,
6.06% due 5/04/00 80,000 80,005,382
Dresdner Bank,
5.93% due 8/07/00 50,000 50,001,056
6.02% due 3/06/00 50,000 50,000,062
Landesbank Hessen Thuringen,
5.19% due 3/01/00 50,000 50,000,000
5.12% due 4/26/00 100,000 99,991,134
Merrill Lynch & Co. Inc.,
5.92% due 3/02/01 500,000 499,900,000
Morgan Stanley Dean Witter Discover,
5.98% due 11/24/00 350,000 350,000,000
---------------
1,179,897,634
---------------
CERTIFICATES OF DEPOSIT (YANKEE) -- 38.5%
- --------------------------------------------------------------------------------
Abbey National Treasury Services,*
5.94% due 5/01/00 350,000 349,962,187
Bank Austria,
5.15% due 5/04/00 100,000 99,996,622
5.20% due 5/10/00 35,000 34,995,478
5.95% due 8/21/00 75,000 74,983,021
5.93% due 9/07/00 100,000 99,975,124
6.71% due 2/12/01 135,000 134,951,161
Bank of Montreal,
5.11% due 4/10/00 100,000 99,994,723
Bank of Nova Scotia,
6.71% due 2/05/01 150,000 149,946,826
6.74% due 2/16/01 40,000 40,015,562
Barclays Bank Plc.,
6.69% due 2/20/01 100,000 99,967,614
Bayerische Hypo,
5.16% due 4/03/00 100,000 99,995,648
5.10% due 4/12/00 100,000 99,995,565
Bayerische Landesbank,
5.86% due 9/27/00 94,000 93,966,382
Bayerische Vereinsbank,
5.15% due 3/23/00 100,000 99,997,098
Bear Stearns Cos. Inc.,
6.05% due 2/20/01 250,000 250,000,000
Branch Bank & Trust,
5.98% due 2/16/01 300,000 299,887,620
Commerzbank,
5.22% due 5/10/00 100,000 99,990,772
5.58% due 6/19/00 160,000 159,986,127
5.77% due 7/03/00 120,000 119,984,391
6.67% due 3/01/01 100,000 99,952,547
Deutsche Bank,
5.33% due 3/09/00 50,000 50,000,738
5.88% due 4/26/00* 225,000 224,975,769
5.51% due 6/08/00 96,000 95,990,004
5.71% due 7/10/00 100,000 99,986,250
6.20% due 10/18/00 100,000 99,969,834
6.45% due 1/08/01 100,000 99,959,229
Lloyds Bank,
5.67% due 7/17/00 100,000 99,981,892
Nord Deutsche Landesbank,
5.16% due 5/17/00 100,000 99,987,813
12
<PAGE>
CASH RESERVES PORTFOLIO
PORTFOLIO OF INVESTMENTS February 29, 2000
(Unaudited)
PRINCIPAL
AMOUNT
ISSUER (000'S OMITTED) VALUE
- --------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT (YANKEE) -- (CONT'D)
Rabobank Nederland,
5.08% due 4/12/00 $100,000 $99,994,456
5.52% due 6/07/00 62,000 61,933,420
6.02% due 6/30/00 71,000 70,987,238
6.13% due 10/31/00 50,000 47,924,306
6.47% due 1/18/01 100,000 99,957,928
6.52% due 1/25/01 140,000 139,939,851
6.64% due 3/02/01 95,000 94,954,899
Societe Generale,
6.56% due 1/16/01 108,000 107,954,895
Svenska Handelsbanken,
5.28% due 3/03/00 120,000 120,000,488
5.23% due 5/10/00 100,000 99,992,618
5.59% due 6/19/00 50,000 49,995,665
Toronto Dominion,
5.15% due 4/27/00 100,000 99,992,481
6.71% due 2/07/01 90,000 89,979,907
UBS AG Stamford,
5.29% due 5/19/00 260,000 259,626,107
5.29% due 5/22/00 85,000 84,990,821
5.34% due 5/24/00 50,000 49,994,380
5.60% due 6/26/00 25,000 24,996,159
5.76% due 7/05/00 50,000 49,975,102
5.93% due 10/02/00 50,000 49,865,478
6.24% due 12/06/00 50,000 49,972,593
6.23% due 12/07/00 120,000 119,942,776
---------------
5,352,367,565
---------------
COMMERCIAL PAPER -- 26.5%
- --------------------------------------------------------------------------------
ABN-Amro Bank,
5.95% due 8/07/00 50,000 48,686,042
6.03% due 10/10/00 100,000 96,264,750
Abbey National North America,
5.21% due 3/03/00 170,000 169,950,794
Alpine Securitization Corp.,
5.80% due 3/10/00 94,072 93,935,596
Aspen Funding Corp.,
5.93% due 3/01/00 250,000 250,000,000
Barton Capital Corp.,
5.90% due 4/07/00 36,449 36,227,977
Bear Stearns Cos. Inc.,
5.79% due 3/24/00 250,000 249,075,208
5.79% due 5/12/00 150,000 148,263,000
British Telecommunications Plc.,
6.18% due 11/17/00 100,000 95,519,500
Cregem North America Inc.,
5.73% due 5/22/00 125,000 123,368,542
5.99% due 10/10/00 100,000 96,289,528
Den Danske Bank,
5.92% due 7/06/00 160,000 156,658,489
6.03% due 10/10/00 50,000 48,132,375
Exxon Asset Mgmt.,
5.88% due 3/01/00 70,000 70,000,000
Exxon Corp.,
5.90% due 3/01/00 100,000 100,000,000
Four Winds Funding Corp.,
5.79% due 3/10/00 100,000 99,855,250
General Electric Capital Corp.,
5.95% due 3/17/00 200,000 199,471,111
5.75% due 4/20/00 50,000 49,600,694
General Electric Capital Services Inc.,
5.75% due 4/20/00 100,000 99,201,389
Greyhawk Capital Corp.,
5.85% due 4/06/00 130,000 129,239,500
5.85% due 4/10/00 100,000 99,350,000
International Nederland,
6.18% due 11/17/00 100,000 95,519,500
Johnson & Johnson,
5.82% due 6/30/00 43,380 42,531,415
5.80% due 7/05/00 50,000 48,985,000
5.80% due 7/25/00 25,000 24,411,944
5.77% due 7/26/00 50,000 48,821,958
Kittyhawk Funding,
5.79% due 3/09/00 105,611 105,475,114
Morgan Stanley Dean Witter Discover,
5.90% due 3/01/00 300,000 300,000,000
Moriarty Ltd.,
5.87% due 4/10/00 150,000 149,021,666
Pooled Accounts Receivable Capital Corp.,
5.80% due 3/10/00 42,042 41,981,039
Sigma Finance Corp.,
6.22% due 3/15/00 200,000 199,998,460
5.75% due 5/17/00 50,000 49,385,069
5.75% due 5/22/00 21,000 20,724,958
5.75% due 5/30/00 30,000 29,568,750
6.20% due 11/21/00 75,000 71,579,844
---------------
3,687,094,462
---------------
CORPORATE NOTES -- 1.4%
- --------------------------------------------------------------------------------
J. P. Morgan & Co., Inc.
5.92% due 5/04/00 200,000 200,000,000
---------------
MEDIUM TERM NOTES -- 2.7%
- --------------------------------------------------------------------------------
Abbey National Treasury Services,
6.19% due 10/18/00 100,000 99,963,800
Credit Suisse,
6.01% due 5/10/00 200,000 200,000,000
Household Financial Corp.,
6.15% due 9/14/00 74,000 73,976,102
---------------
373,939,902
---------------
13
<PAGE>
CASH RESERVES PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued) February 29, 2000
(Unaudited)
PRINCIPAL
AMOUNT
ISSUER (000'S OMITTED) VALUE
- --------------------------------------------------------------------------------
TIME DEPOSITS -- 4.2%
- --------------------------------------------------------------------------------
BankAmerica,
5.81% due 3/01/00 $300,000 $300,000,000
Barclays Bank Plc.,
5.81% due 3/01/00 285,155 285,155,000
---------------
585,155,000
---------------
UNITED STATES GOVERNMENT AGENCY -- 2.7%
- --------------------------------------------------------------------------------
Federal Home Loan Bank,
5.97% due 12/01/00 100,000 99,892,555
Federal Home Loan Bank Consumer Discount Notes,
5.39% due 7/28/00 50,000 48,884,569
Federal Home Loan Mortgage Discount Notes,
5.21% due 3/09/00 48,062 48,006,355
5.16% due 6/13/00 50,000 49,254,667
5.22% due 6/15/00 135,000 132,925,050
---------------
378,963,196
---------------
UNITED STATES TREASURY BILLS -- 2.3%
- --------------------------------------------------------------------------------
United States Treasury Bills,
5.21% due 11/09/00 50,000 48,169,264
5.28% due 11/09/00 50,000 48,144,667
5.40% due 11/09/00 50,000 48,102,500
5.56% due 11/09/00 100,000 96,310,416
5.62% due 11/09/00 85,000 81,826,519
---------------
322,553,366
---------------
TOTAL INVESTMENTS,
AT AMORTIZED COST 105.5% $14,672,508,771
OTHER ASSETS,
LESS LIABILITIES (5.5) (770,572,308)
----- ---------------
NET ASSETS 100.0% $13,901,936,463
===== ===============
* Variable interest rate -- subject to periodic change.
See notes to financial statements
14
<PAGE>
CASH RESERVES PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
FEBRUARY 29, 2000 (Unaudited)
================================================================================
ASSETS:
Investments at value (Note 1A) $14,672,508,771
Cash 938
Interest receivable 175,364,534
- --------------------------------------------------------------------------------
Total assets 14,847,874,243
- --------------------------------------------------------------------------------
LIABILITIES:
Payable for investments purchased 944,854,899
Payable to affiliate--Investment Advisory fee (Note 2A) 864,921
Accrued expenses and other liabilities 217,960
- --------------------------------------------------------------------------------
Total liabilities 945,937,780
- --------------------------------------------------------------------------------
NET ASSETS $13,901,936,463
================================================================================
REPRESENTED BY:
Paid-in capital for beneficial interests $13,901,936,463
================================================================================
See notes to financial statements
15
<PAGE>
CASH RESERVES PORTFOLIO
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED FEBRUARY 29, 2000 (Unaudited)
================================================================================
INTEREST INCOME (Note 1B): $437,190,840
EXPENSES:
Investment Advisory fees (Note 2A) $ 11,526,046
Administrative fees (Note 2B) 3,842,015
Custody and fund accounting fees 1,767,061
Trustees' fees 31,814
Audit fees 21,000
Legal fees 19,982
Other 28,152
- --------------------------------------------------------------------------------
Total expenses 17,236,070
Less aggregate amounts waived by Investment Adviser
and Administrator (Notes 2A, and 2B) (9,549,938)
Less fees paid indirectly (Note 1E) (421)
- --------------------------------------------------------------------------------
Net expenses 7,685,711
- --------------------------------------------------------------------------------
Net investment income $429,505,129
================================================================================
See notes to financial statements
16
<PAGE>
CASH RESERVES PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED
FEBRUARY 29, 2000 YEAR ENDED
(Unaudited) AUGUST 31, 1999
================================================================================
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment income $ 429,505,129 $ 628,439,104
- --------------------------------------------------------------------------------
CAPITAL TRANSACTIONS:
Proceeds from contributions 27,245,381,664 47,581,662,450
Value of withdrawals (28,702,294,978) (42,086,666,522)
- --------------------------------------------------------------------------------
Net increase (decrease) in net assets from
capital transactions (1,456,913,314) 5,494,995,928
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (1,027,408,185) 6,123,435,032
- --------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 14,929,344,648 8,805,909,616
- --------------------------------------------------------------------------------
End of period $13,901,936,463 $14,929,344,648
================================================================================
See notes to financial statements
17
<PAGE>
x
CASH RESERVES PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED AUGUST 31,
FEBRUARY 29, 2000 ----------------------------------------------------------------
(Unaudited) 1999 1998 1997 1996 1995
================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
RATIOS/SUPPLEMENTAL DATA:
Net assets (000's omitted) $13,901,936 $14,929,345 $8,805,910 $7,657,400 $4,442,187 $4,765,406
Ratio of expenses to average
net assets 0.10%* 0.10% 0.10% 0.10% 0.10% 0.10%
Ratio of net investment income
to average net assets 5.57%* 5.13% 5.65% 5.57% 5.64% 5.88%
Note: If agents of the Portfolio had not voluntarily waived a portion of their
fees for the periods indicated, the ratios would have been as follows:
RATIOS:
Expenses to average net
assets 0.22%* 0.22% 0.22% 0.23% 0.23% 0.23%
Net investment income to
average net assets 5.45%* 5.01% 5.53% 5.44% 5.50% 5.75%
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
* Annualized
See notes to financial statements
18
<PAGE>
CASH RESERVES PORTFOLIO
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES Cash Reserves Portfolio (the "Portfolio") is
registered under the U.S. Investment Company Act of 1940, as amended, as a
no-load, diversified, open-end management investment company which was organized
as a trust under the laws of the State of New York. The Declaration of Trust
permits the Trustees to issue beneficial interests in the Portfolio. Signature
Financial Group (Grand Cayman), Ltd. ("SFG") acts as the Portfolio's
Administrator and Citibank, N.A. ("Citibank") acts as the Investment Adviser.
Citibank is a wholly-owned subsidiary of Citigroup Inc.
The preparation of financial statements in accordance with United States of
America generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts and disclosures in
the financial statements. Actual results could differ from those estimates.
The significant accounting policies consistently followed by the Portfolio
are as follows:
A. VALUATION OF INVESTMENTS Money market instruments are valued at amortized
cost, which the Trustees have determined in good faith constitutes fair value.
This method involves valuing a portfolio security at its cost and thereafter
assuming a constant amortization to maturity of any discount or premium. The
Portfolio's use of amortized cost is subject to the Portfolio's compliance with
certain conditions as specified under Rule 2a-7 of the U.S. Investment Company
Act of 1940.
B. INTEREST INCOME AND EXPENSES Interest income consists of interest accrued
and discount earned (including both original issue and market discount) on the
investments of the Portfolio, accrued ratably to the date of maturity, plus or
minus net realized gain or loss, if any, on investments. Expenses of the
Portfolio are accrued daily. The Portfolio bears all costs of its operations
other than expenses specifically assumed by Citibank and SFG.
C. U.S. FEDERAL INCOME TAXES The Portfolio is considered a partnership under
the U.S. Internal Revenue Code. Accordingly, no provision for federal income
taxes is necessary.
D. REPURCHASE AGREEMENT It is the policy of the Portfolio 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 in support of repurchase agreement
investments. Additionally, procedures have been established by the Portfolio to
monitor, on a daily basis, the market value of the repurchase agreement's
underlying investments to ensure the existence of a proper level of collateral.
E. OTHER Purchases, maturities and sales of money market instruments are
accounted for on the date of the transaction.
19
<PAGE>
CASH RESERVES PORTFOLIO
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
2. INVESTMENT ADVISORY FEES AND ADMINISTRATIVE FEES
A. INVESTMENT ADVISORY FEE The investment advisory fees paid to Citibank, as
compensation for overall investment management services, amounted to $11,526,046
of which $5,707,922 was voluntarily waived for the six months ended February 29,
2000. The investment advisory fees are computed at an annual rate of 0.15% of
the Portfolio's average daily net assets.
B. ADMINISTRATIVE FEES Under the terms of an Administrative Services
Agreement, the administrative fee paid to the Administrator, as compensation for
overall administrative services and general office facilities, are computed at
the annual rate of 0.05% of the Portfolio's average daily net assets. The
Administrative fees amounted to $3,842,015, all of which were voluntarily waived
for the six months ended February 29, 2000. The Portfolio pays no compensation
directly to any Trustee or to any officer who is affiliated with the
Administrator, all of whom receive remuneration for their services to the
Portfolio from the Administrator or its affiliates. Certain of the officers and
a Trustee of the Portfolio are officers and a director of the Administrator or
its affiliates.
3. INVESTMENT TRANSACTIONS Purchases, maturities and sales of money market
instruments aggregated $175,256,041,856 and $175,492,697,226, respectively, for
the six months ended February 29, 2000.
4. LINE OF CREDIT The Portfolio, along with other CitiFunds, entered into an
agreement with a bank which allows the Funds collectively to borrow up to $75
million for temporary or emergency purposes. Interest on borrowings, if any, is
charged to the specific fund executing the borrowing at the base rate of the
bank. The line of credit requires a quarterly payment of a commitment fee based
on the average daily unused portion of the line of credit. For the six months
ended February 29, 2000, the commitment fee allocated to the Portfolio was
$22,033. Since the line of credit was established, there have been no
borrowings.
20
<PAGE>
TRUSTEES AND OFFICERS
Philip W. Coolidge*, President
Mark T. Finn
Riley C. Gilley
William S. Woods, Jr.**
SECRETARY
Linda T. Gibson*
TREASURER
Linwood Downs*
*AFFILIATED PERSON OF ADMINISTRATOR AND DISTRIBUTOR
**TRUSTEE EMERITUS
INVESTMENT ADVISER
(OF CASH RESERVES PORTFOLIO)
Citibank, N.A.
153 East 53rd Street, New York, NY 10043
ADMINISTRATOR AND DISTRIBUTOR
CFBDS, Inc.
21 Milk Street, 5th Floor, Boston, MA 02109
(617) 423-1679
TRANSFER AGENT AND CUSTODIAN
State Street Bank and Trust Company
225 Franklin Street, Boston, MA 02110
AUDITORS
PricewaterhouseCoopers LLP
160 Federal Street, Boston, MA 02110
LEGAL COUNSEL
Bingham Dana LLP
150 Federal Street, Boston, MA 02110
<PAGE>
THE CITIFUNDS FAMILY
LARGE CAP STOCKS
CitiFunds Growth & Income Portfolio
CitiFunds Large Cap Growth Portfolio
SMALL CAP STOCKS
CitiFunds Small Cap Growth Portfolio
CitiFunds Small Cap Value Portfolio
INTERNATIONAL STOCKS
CitiFunds International Growth & Income Portfolio
CitiFunds International Growth Portfolio
GROWTH WITH INCOME
CitiFunds Balanced Portfolio
BONDS
CitiFunds Short-Term U.S. Government Income Portfolio
CitiFunds Intermediate Income Portfolio
CitiFunds National Tax Free Income Portfolio
CitiFunds New York Tax Free Income Portfolio
CitiFunds California Tax Free Income Portfolio
MONEY MARKETS
CitiFunds Cash Reserves
CitiFunds U.S. Treasury Reserves
CitiFunds Tax Free Reserves
CitiFunds New York Tax Free Reserves
CitiFunds California Tax Free Reserves
CitiFunds Connecticut Tax Free Reserves
PREMIUM MONEY MARKETS
CitiFunds Premium Liquid Reserves
CitiFunds Premium U.S. Treasury Reserves
INSTITUTIONAL MONEY MARKETS
CitiFunds Institutional Liquid Reserves
CitiFunds Institutional U.S. Treasury Reserves
CitiFunds Institutional TaxFree Reserves
CitiFunds Institutional Cash Reserves
This report is prepared for the information of shareholders of CitiFunds Premium
Liquid Reserves. It is authorized for distribution to prospective investors only
when preceded or accompanied by an effective prospectus of CitiFunds Premium
Liquid Reserves.
For more information about any of the CitiFunds listed above, ask for a
prospectus (except for CitiFunds Premium Liquid Reserves, which preceded or
accompanies this report) containing more complete information, including all
sales charges (if any), fees and expenses. Please read the prospectus carefully
before you invest or send money.
Although each money market fund seeks to maintain the value of your investment
at $1.00 per share, it is possible to lose money by investing in the funds.
Mutual fund shares are not guaranteed or insured by the Federal Deposit
Insurance Corporation or any other government agency.
CitiFunds are made available by CFBDS, Inc. as distributor. For more information
contact your Service Agent or call 1-800-625-4554.
(c)2000 Citicorp [GRAPHIC OMITTED] Printed on recycled paper CFS/PLR/200
<PAGE>
CITIFUNDS(SM) [LOGO]
PREMIUM
U.S. TREASURY
RESERVES
SEMI-ANNUAL REPORT
FEBRUARY 29, 2000 CITIFUNDS
- --------------------------------------------------------------------------------
INVESTMENT PRODUCTS: NOT FDIC INSURED o NO BANK GUARANTEE o MAY LOSE VALUE
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Letter to Our Shareholders 1
- --------------------------------------------------------------------------------
Portfolio Environment and Outlook 2
- --------------------------------------------------------------------------------
Fund Facts 3
- --------------------------------------------------------------------------------
Fund Performance 4
- --------------------------------------------------------------------------------
CITIFUNDS PREMIUM U.S. TREASURY RESERVES
Statement of Assets and Liabilities 5
- --------------------------------------------------------------------------------
Statement of Operations 6
- --------------------------------------------------------------------------------
Statement of Changes in Net Assets 7
- --------------------------------------------------------------------------------
Financial Highlights 8
- --------------------------------------------------------------------------------
Notes to Financial Statements 9
- --------------------------------------------------------------------------------
U.S. TREASURY RESERVES PORTFOLIO
Portfolio of Investments 12
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities 13
- --------------------------------------------------------------------------------
Statement of Operations 13
- --------------------------------------------------------------------------------
Statement of Changes in Net Assets 14
- --------------------------------------------------------------------------------
Financial Highlights 14
- --------------------------------------------------------------------------------
Notes to Financial Statements 15
- --------------------------------------------------------------------------------
<PAGE>
LETTER TO OUR SHAREHOLDERS
Dear Shareholder:
Rising interest rates during the reporting period have benefited money market
investors, who earned higher yields while preserving capital. The Federal
Reserve Board (the "Fed") raised interest rates three times in 1999 and most
recently on February 2, 2000 for a total increase of 100 basis points. (A basis
point is .01% or one one-hundredth of a percent.) The Fed's actions were
implemented to forestall a reacceleration of inflation, a potential consequence
of the continued growth of the U.S. economy.
In this environment, the CitiFunds' investment adviser, Citibank, N.A.,
continued to manage CitiFunds Premium U.S. Treasury Reserves with the goal of
achieving its investment objective: providing liquidity and as high a level of
current income from U.S. government obligations as is consistent with the
preservation of capital.
This report reviews the Fund's investment activities and performance during
the six months ended February 29, 2000, and provides a summary of Citibank's
perspective on and outlook for the money market securities marketplace.
Thank you for your continued confidence and participation.
Sincerely,
/s/ Philip W. Coolidge
- ----------------------
Philip W. Coolidge
President
March 15, 2000
1
<PAGE>
PORTFOLIO ENVIRONMENT AND OUTLOOK
THE PAST SIX MONTHS HAVE BEEN GENERALLY REWARDING FOR MANY INVESTORS IN
SHORT-TERM U.S. TREASURY SECURITIES. Yields on such investments ended the
six-month reporting period higher than where they began, reflecting the general
trend of higher short-term interest rates in a period of rising interest rates.
While rising interest rates negatively affected the prices of long-term bonds,
price declines were much more modest among short-term securities such as those
in which the Portfolio invests.
The positive economic conditions that led to higher interest rates during the
reporting period included strong U.S. economic growth, low inflation, robust
consumer spending and rising demand for U.S. exports. As a result of these
factors, many investors became concerned that unsustainable U.S. economic growth
might cause inflationary pressures to resurface. As previously noted, in an
attempt to forestall a potential reacceleration of inflation, the Fed raised
interest rates in three 25-basis point increments during 1999 and raised them an
additional 25 basis points on February 2, 2000.
DESPITE THE POSITIVE EFFECTS OF HIGHER INTEREST RATES, THE U.S. TREASURY
MARKET'S RETURNS WERE CONSTRAINED BY ITS OWN MARKET-SPECIFIC INFLUENCES, MOST
NOTABLY CHANGES IN THE BALANCE BETWEEN SUPPLY AND DEMAND. Issuance of short-term
U.S. Treasury securities generally fell during the reporting period, as the
strong U.S. economy enabled the federal government to post a budget surplus,
reducing the government's need to borrow.
At the same time, demand was strong from foreign and domestic investors
seeking a relatively safe place for money awaiting reinvestment in longer-term
securities. Because of this imbalance between supply and demand, yields on U.S.
Treasury securities tended to rise less than yields of other short-term
instruments.
THE PORTFOLIO MANAGERS' STRATEGY DURING THE SIX-MONTH PERIOD WAS TO MAINTAIN
A RELATIVELY SHORT AVERAGE MATURITY, which was designed to enhance liquidity and
keep assets available for higher-yielding securities as they became available.
As of February 29, 2000, the Portfolio's average maturity was 52 days. (Maturity
is the date on which the principal amount of a note, draft, acceptance bond or
other debt instrument becomes due and payable.) The portfolio's policy is to
maintain a maximum average maturity of not more than 60 days in order to
maintain its AAA/Aaa ratings by both Standard & Poor's and Moody's Investors
Service Inc. (Standard & Poor's Corporation and Moody's Investor Service Inc.
are two major credit reporting and bond-rating agencies.)
In addition, THE MANAGERS ACTIVELY MANAGED THE MIX OF MATURITIES WITHIN THE
FUND'S PORTFOLIO. Because of year-end and Y2K-related concerns, many investors
gravitated to U.S. Treasury securities maturing during the first quarter of
2000. The Fund's managers avoided these maturities because of their low yields.
Instead, short-term securities were emphasized as the end of 1999 approached,
and the investment team purchased short-term Cash Management Bills issued by the
U.S. Treasury to ensure market liquidity during the transition from 1999 to
2000. Y2K-related market disruptions have not materialized. However, the
managers took advantage of this temporary opportunity to capture higher yield
potential for the Fund's portfolio.
2
<PAGE>
Looking forward, the Fund's managers expect interest rates to remain near or
slightly above current levels if the Fed continues to move toward a more
restrictive monetary policy. However, MANAGEMENT BELIEVES THAT OVER THE LONG
TERM, INTEREST RATES MAY BEGIN TO DECLINE IF THE ECONOMY BEGINS TO SHOW EVIDENCE
THAT IT IS MODERATING. Accordingly, the managers are carefully searching for
opportunities to take advantage of changes in the direction of interest rates,
including possibly extending the Fund's average maturity within its conservative
parameters to lock in higher yields in the near term.
FUND FACTS
FUND OBJECTIVE
To provide liquidity and as high a level of current income from U.S. government
obligations as is consistent with the preservation of capital.
INVESTMENT ADVISER, DIVIDENDS
U.S. TREASURY RESERVES PORTFOLIO Declared daily, paid monthly
Citibank, N.A
COMMENCEMENT OF OPERATIONS BENCHMARK*
March 1, 1991 o Lipper S&P AAA rated U.S.
Treasury Money Market
Funds Average
NET ASSETS AS OF 2/29/00 o IBC Financial Data 100% U.S.
$323.1 million Treasury Rated Money
Market Funds Average
* The Lipper Funds Average and IBC Funds Average reflect the performance
(excluding sales charges) of mutual funds with similar objectives.
3
<PAGE>
FUND PERFORMANCE
TOTAL RETURNS
<TABLE>
<CAPTION>
SINCE
MARCH 1,
ALL PERIODS ENDING FEBRUARY 29, 2000 SIX ONE FIVE 1991
(Unaudited) MONTHS** YEAR YEARS* INCEPTION*
===============================================================+++++=================
<S> <C> <C> <C> <C>
CitiFunds Premium U.S. Treasury Reserves 2.32% 4.48% 4.83% 4.39%
Lipper S&P AAA rated U.S. Treasury
Money Market Funds Average 2.31% 4.46% 4.77% 4.28%+
IBC Financial Data 100% U.S. Treasury
Rated Money Market Funds Average 2.23% 4.29% 4.64% 4.27%+
</TABLE>
* Average Annual Total Return
** Not Annualized
+ From 2/28/91
7-DAY YIELDS
Annualized Current 5.05%
Effective 5.18%
The ANNUALIZED CURRENT 7-DAY YIELD reflects the amount of income generated by
the investment during the seven day period and assumes that the income is
generated each week over a 365 day period. The yield is shown as a percentage of
the investment.
The EFFECTIVE 7-DAY YIELD is calculated similarly, but when annualized, the
income earned by the investment during that seven-day period is assumed to be
reinvested. The effective yield is slightly higher than the current yield
because of the compounding effect of this assumed reinvestment.
Note: A money market fund's yield more closely reflects the current earnings of
the fund than does the total return.
Note: Mutual fund shares are not guaranteed or insured by the Federal Deposit
Insurance Corporation or any other government agency. Yields and total returns
will fluctuate and past performance is no guarantee of future results. Total
return figures include reinvestment of dividends. Returns and yields reflect
certain voluntary fee waivers. If the waivers were not in place, the Fund's
returns and yields would have been lower.
4
<PAGE>
CITIFUNDS PREMIUM U.S. TREASURY RESERVES
STATEMENT OF ASSETS AND LIABILITIES
FEBRUARY 29, 2000 (Unaudited)
================================================================================
ASSETS:
Investment in U.S. Treasury Reserves Portfolio, at value (Note 1) $324,592,528
Receivable for shares of beneficial interest sold 7,000
- --------------------------------------------------------------------------------
Total assets 324,599,528
- --------------------------------------------------------------------------------
LIABILITIES:
Dividends payable 877,776
Payable for shares of beneficial interest repurchased 535,331
Payable to affiliate--Shareholder servicing agents' fees (Note 3B) 26,080
Accrued expenses and other liabilities 109,046
- --------------------------------------------------------------------------------
Total liabilities 1,548,233
- --------------------------------------------------------------------------------
NET ASSETS For 323,051,295 shares of
beneficial interest outstanding $323,051,295
================================================================================
NET ASSETS CONSIST OF:
Paid-in capital $323,051,295
================================================================================
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION PRICE PER SHARE $1.00
================================================================================
See notes to financial statements
5
<PAGE>
CITIFUNDS PREMIUM U.S. TREASURY RESERVES
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED FEBRUARY 29, 2000 (Unaudited)
================================================================================
INVESTMENT INCOME (Note 1A):
Income from U.S. Treasury Reserves Portfolio $6,874,834
Allocated expenses from U.S. Treasury
Reserves Portfolio (134,553)
- --------------------------------------------------------------------------------
$6,740,281
EXPENSES:
Administrative fees (Note 3A) 468,548
Shareholder Servicing Agents' fees (Note 3B) 133,871
Distribution fees (Note 4) 133,871
Registration fees 23,809
Legal fees 16,500
Audit fees 10,792
Custody and fund accounting fees 9,877
Shareholder Reports 7,014
Transfer agent fees 6,000
Trustees' fees 3,441
Miscellaneous 13,697
- --------------------------------------------------------------------------------
Total expenses 827,420
Less aggregate amounts waived by
Administrator and Distributor (Notes 3A and 4) (355,966)
- --------------------------------------------------------------------------------
Net expenses 471,454
- --------------------------------------------------------------------------------
Net investment income $6,268,827
================================================================================
See notes to financial statements
6
<PAGE>
CITIFUNDS PREMIUM U.S. TREASURY RESERVES
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED
FEBRUARY 29, 2000 YEAR ENDED
(Unaudited) AUGUST 31, 1999
- --------------------------------------------------------------------------------
FROM INVESTMENT ACTIVITIES:
Net investment income, declared as
dividends to shareholders (Note 2) $ 6,268,827 $ 11,207,763
- --------------------------------------------------------------------------------
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST AT
NET ASSET VALUE OF $1.00 PER SHARE (Note 5):
Proceeds from sale of shares 498,655,549 570,585,556
Net asset value of shares issued to shareholders
from reinvestment of dividends 2,644,852 6,647,364
Cost of shares repurchased (415,768,974) (665,450,936)
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS 85,531,427 (88,218,016)
- --------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 237,519,868 325,737,884
- --------------------------------------------------------------------------------
End of period $ 323,051,295 $ 237,519,868
================================================================================
See notes to financial statements
7
<PAGE>
CITIFUNDS PREMIUM U.S. TREASURY RESERVES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED AUGUST 31,
FEBRUARY 29, 2000 -----------------------------------------------------
(Unaudited) 1999 1998 1997 1996 1995
===================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning
of period $1.00000 $1.00000 $1.00000 $1.00000 $1.00000 $1.00000
Net investment income 0.02295 0.04195 0.04802 0.04794 0.04851 0.04999
Less dividends from net
investment income (0.02295) (0.04195) (0.04802) (0.04794) (0.04851) (0.04999)
- ---------------------------------------------------------------------------------------------------
Net Asset Value, end of period 1.00000 $1.00000 $1.00000 $1.00000 $1.00000 $1.00000
===================================================================================================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000's omitted) $323,051 $237,520 $325,738 $239,441 $235,271 $317,312
Ratio of expenses to
average net assets+ 0.45%* 0.45% 0.45% 0.45% 0.45% 0.45%
Ratio of net investment income
to average net assets+ 4.67%* 4.21% 4.81% 4.80% 4.88% 5.02%
Total return 2.32%** 4.28% 4.91% 4.90% 4.96% 5.12%
Note: If Agents of the Fund and agents of U.S. Treasury Reserves Portfolio had
not waived all or a portion of their fees during the periods indicated, the net
investment income per share and the ratios would have been as follows:
Net investment income per share $0.02098 $0.03836 $0.04433 $0.04414 $0.04463 $0.04601
RATIOS:
Expenses to average net assets+ 0.85%* 0.81% 0.82% 0.83% 0.85% 0.84%
Net investment income to
average net assets+ 4.27%* 3.85% 4.44% 4.42% 4.49% 4.62%
===================================================================================================
</TABLE>
+ Includes the Fund's share of U.S. Treasury Reserves Portfolio's allocated
expenses.
* Annualized
** Not Annualized.
See notes to financial statements
8
<PAGE>
CITIFUNDS PREMIUM U.S. TREASURY RESERVES
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES CitiFunds Premium U.S. Treasury Reserves (the
"Fund") is a diversified separate series of CitiFunds Premium Trust (the
"Trust"), a Massachusetts business trust. The Trust is registered under the
Investment Company Act of 1940, as amended, as an open-end management investment
company. The Fund invests all of its investable assets in U.S. Treasury Reserves
Portfolio (the "Portfolio"), an open-end, diversified management investment
company for which Citibank, N.A. ("Citibank") serves as Investment Adviser. The
value of such investment reflects the Fund's proportionate interest (26.5% at
February 29, 2000) in the net assets of the Portfolio. CFBDS, Inc. ("CFBDS"),
acts as the Trust's Administrator and Distributor. Citibank also serves as
Sub-Administrator and makes shares available to customers through various
Shareholder Servicing Agents. Citibank is a wholly-owned subsidiary of Citigroup
Inc.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates.
The financial statements of the Portfolio, including the portfolio of
investments, are contained elsewhere in this report and should be read in
conjunction with the Fund's financial statements.
The significant accounting policies consistently followed by the Fund are as
follows:
A. INVESTMENT INCOME The Fund earns income, net of Portfolio expenses, daily
on its investment in the Portfolio.
B. FEDERAL TAXES The Fund's policy is to comply with the provisions of the
Internal Revenue Code available to regulated investment companies and to
distribute to shareholders all of its taxable income. Accordingly, no provision
for federal income or excise tax is necessary.
C. EXPENSES The Fund bears all costs of its operations other than expenses
specifically assumed by Citibank and CFBDS. Expenses incurred by the Trust with
respect to any two or more Funds in a series are allocated in proportion to the
average net assets of each Fund, except where allocations of direct expenses to
each Fund can otherwise be made fairly. Expenses directly attributable to a Fund
are charged to that Fund.
D. OTHER All the net investment income of the Portfolio is allocated pro
rata, based on respective ownership interests, among the Fund and other
investors in the Portfolio at the time of such determination.
2. DIVIDENDS The net income of the Fund is determined once daily, as of 12:00
noon Eastern Standard Time, and all of the net income of the Fund so determined
is declared as a dividend to shareholders of record at the time of such
determination. Dividends are distributed in the form of additional shares of the
Fund or, at the election of the shareholder, in cash (subject to the policies of
the shareholder's Shareholder Servicing Agent) on or prior to the last business
day of the month.
9
<PAGE>
CITIFUNDS PREMIUM U.S. TREASURY RESERVES
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
3. ADMINISTRATIVE SERVICES PLAN The Trust has adopted an Administrative Services
Plan which provides that the Trust, on behalf of each Fund, may obtain the
services of an Administrator, one or more Shareholder Servicing Agents, and
other Servicing Agents and may enter into agreements providing for the payment
of fees for such services. Under the Trust's Administrative Services Plan, the
aggregate of the fee paid to the Administrator from the Fund and of the fees
paid to the Shareholder Servicing Agents from the Fund under such plan may not
exceed 0.45% of the Fund's average daily net assets on an annualized basis for
the Fund's then-current fiscal year. For the six months ended February 29, 2000,
management agreed to voluntarily limit Fund expenses to 0.45%.
A. ADMINISTRATIVE FEES Under the terms of an Administrative Services
Agreement, CFBDS is entitled to an administrative fee from the Fund, as
compensation for overall administrative services and general office facilities
which is accrued daily and paid monthly at the annual rate of 0.35% of the
Fund's average daily net assets. The Administrative fees amounted to $468,548,
of which $222,095 was voluntarily waived for the six months ended February 29,
2000. Citibank acts as Sub-Administrator and performs such duties and receives
such compensation from CFBDS as from time to time is agreed to by CFBDS and
Citibank. The Fund pays no compensation directly to any Trustee or to any
officer who is affiliated with the Administrator, all of whom receive
remuneration for their services to the Fund from the Administrator or its
affiliates. Certain of the officers and a Trustee of the Fund are officers and a
director of the Administrator or its affiliates.
B. SHAREHOLDER SERVICING AGENT FEES The Trust, on behalf of the Fund, entered
into shareholder servicing agreements with each Shareholder Servicing Agent
pursuant to which the Shareholder Servicing Agent acts as an agent for its
customers and provides other related services. For their services, each
Shareholder Servicing Agent receives fees from the Fund, which may be paid
periodically, but may not exceed, on an annualized basis, an amount equal to
0.10% of the average daily net assets of the Fund represented by shares owned
during the period for which payment is being made by investors for whom such
Shareholder Servicing Agent maintains a servicing relationship. The Shareholder
Servicing Agent fees amounted to $133,871 for the six months ended February 29,
2000.
4. DISTRIBUTION FEES The Trust adopted a Plan of Distribution pursuant to Rule
12b-1 under the Investment Company Act of 1940, as amended, in which the Fund
reimburses the Distributor for expenses incurred or anticipated in connection
with the sale of shares of the Fund, limited to an annual rate of 0.10% of the
average daily net assets of the Fund. The Distribution fees amounted to
$133,871, all of which was voluntarily waived for the six months ended February
29, 2000. The Distributor has voluntarily agreed to assume all distribution
expenses through February 29, 2000.
10
<PAGE>
CITIFUNDS PREMIUM U.S. TREASURY RESERVES
NOTES TO FINANCIAL STATEMENTS (Unaudited)
5. SHARES OF BENEFICIAL INTEREST The Declaration of Trust permits the Trustees
to issue an unlimited number of full and fractional shares of beneficial
interest ($0.00001 par value).
6. INVESTMENT TRANSACTIONS Increases and decreases in the Fund's investment in
the Portfolio aggregated $916,563,441 and $836,644,597, respectively, for the
six months ended February 29, 2000.
11
<PAGE>
U.S. TREASURY RESERVES PORTFOLIO
PORTFOLIO OF INVESTMENTS February 29, 2000
(Unaudited)
PRINCIPAL
AMOUNT
ISSUER (000'S OMITTED) VALUE
- --------------------------------------------------------------------------------
U.S. TREASURY BILLS--99.9%
- --------------------------------------------------------------------------------
United States Treasury Bill,
due 3/23/00 $177,730 $ 177,151,078
United States Treasury Bill,
due 3/30/00 236,017 235,029,871
United States Treasury Bill,
due 4/06/00 165,047 164,177,781
United States Treasury Bill,
due 4/13/00 150,000 149,060,122
United States Treasury Bill,
due 4/27/00 20,437 20,252,575
United States Treasury Bill,
due 5/11/00 25,000 24,728,819
United States Treasury Bill,
due 5/15/00 50,000 50,053,406
United States Treasury Bill,
due 5/18/00 307,213 303,551,493
United States Treasury Bill,
due 5/25/00 100,000 98,669,514
--------------
TOTAL INVESTMENTS,
AT AMORTIZED COST 99.9% $1,222,674,659
OTHER ASSETS,
LESS LIABILITIES 0.1 866,321
----- --------------
NET ASSETS 100.0% $1,223,540,980
===== ==============
See notes to financial statements
12
<PAGE>
U.S. TREASURY RESERVES PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
FEBRUARY 29, 2000 (Unaudited)
================================================================================
ASSETS:
Investments, at amortized cost (Note 1A) $1,222,674,659
Cash 795
Interest receivable 936,985
- --------------------------------------------------------------------------------
Total assets 1,223,612,439
- --------------------------------------------------------------------------------
LIABILITIES:
Payable to affiliate - Investment advisory fees (Note 2A) 24,659
Accrued expenses and other liabilities 46,800
- --------------------------------------------------------------------------------
Total liabilities 71,459
- --------------------------------------------------------------------------------
NET ASSETS $1,223,540,980
================================================================================
REPRESENTED BY:
Paid-in capital for beneficial interests $1,223,540,980
================================================================================
U.S. TREASURY RESERVES PORTFOLIO
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED FEBRUARY 29, 2000 (Unaudited)
================================================================================
INVESTMENT INCOME (Note 1B) $30,465,756
EXPENSES:
Investment Advisory fees (Note 2A) $ 899,841
Administrative fees (Note 2B) 299,947
Custody and fund accounting fees 147,100
Legal fees 31,960
Audit fees 11,300
Trustees' fees 7,469
Miscellaneous 22,808
- --------------------------------------------------------------------------------
Total expenses 1,420,425
Less aggregate amounts waived by Investment Adviser
and Administrator (Notes 2A and 2B) (820,411)
Less fees paid indirectly (Note 1D) (10)
- --------------------------------------------------------------------------------
Net expenses 600,004
- --------------------------------------------------------------------------------
Net investment income $29,865,752
================================================================================
See notes to financial statements
13
<PAGE>
U.S. TREASURY RESERVES PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED
FEBRUARY 29, 2000 YEAR ENDED
(Unaudited) AUGUST 31, 1999
================================================================================
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income $ 29,865,752 $ 40,398,488
- --------------------------------------------------------------------------------
CAPITAL TRANSACTIONS:
Proceeds from contributions 2,663,317,942 3,426,724,559
Value of withdrawals (2,658,269,225) (3,190,341,131)
- --------------------------------------------------------------------------------
Net increase in net assets from
capital transactions 5,048,717 236,383,428
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS 34,914,469 276,781,916
- --------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 1,188,626,511 911,844,595
- --------------------------------------------------------------------------------
End of period $ 1,223,540,980 $ 1,188,626,511
================================================================================
U.S. TREASURY RESERVES PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED AUGUST 31,
FEBRUARY 29, 2000 -----------------------------------------------------------
(Unaudited) 1999 1998 1997 1996 1995
=============================================================================================================
<S> <C> <C> <C> <C> <C> <C>
RATIOS/SUPPLEMENTAL DATA:
Net Assets, end of period
(000's omitted) $1,223,541 $1,188,627 $911,845 $907,910 $767,804 $832,258
Ratio of expenses to
average net assets 0.10%* 0.10% 0.10% 0.10% 0.10% 0.10%
Ratio of net investment income
to average net assets 4.96%* 4.55% 5.14% 5.15% 5.20% 5.36%
Note: If the agents of the Portfolio had not voluntarily waived a portion of
their fees for the periods indicated and the expenses were not reduced for fees
paid indirectly for the years after August 31, 1995, the ratios would have been
as follows:
RATIOS:
Expenses to average net assets 0.24%* 0.23% 0.23% 0.24% 0.25% 0.25%
Net investment income to
average net assets 4.82%* 4.42% 5.01% 5.01% 5.05% 5.21%
=============================================================================================================
</TABLE>
* Annualized
See notes to financial statements
14
<PAGE>
U.S. TREASURY RESERVES PORTFOLIO
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES U.S. Treasury Reserves Portfolio (the
"Portfolio") is registered under the Investment Company Act of 1940, as amended,
as a no-load, diversified, open-end management investment company which was
organized as a trust under the laws of the State of New York. The Declaration of
Trust permits the Trustees to issue beneficial interests in the Portfolio.
CFBDS, Inc ("CFBDS"), acts as the Portfolio's Administrator. Citibank N.A.
("Citibank") acts as the Investment Adviser. Citibank is a wholly-owned
subsidiary of Citigroup Inc.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates.
The significant accounting policies consistently followed by the Portfolio
are as follows:
A. VALUATION OF INVESTMENTS Money market instruments are valued at amortized
cost, which the Trustees have determined in good faith constitutes fair value.
The Portfolio's use of amortized cost is subject to the Portfolio's compliance
with certain conditions as specified under Rule 2a-7 of the Investment Company
Act of 1940.
B. INVESTMENT INCOME AND EXPENSES Investment income consists of interest
accrued and discount earned (including both original issue and market discount),
adjusted for amortization of premium, on the investments of the Portfolio,
accrued ratably to the date of maturity, plus or minus net realized gain or
loss, if any, on investments. Expenses of the Portfolio are accrued daily.
C. FEDERAL INCOME TAXES The Portfolio's policy is to comply with the
applicable provisions of the Internal Revenue Code. Accordingly, no provision
for federal income taxes is necessary.
D. FEES PAID INDIRECTLY The Portfolio's custodian calculates its fees based
on the Portfolio's average daily net assets. The fee is reduced according to a
fee arrangement, which provides for custody fees to be reduced based on a
formula developed to measure the value of cash deposited with the custodian by
the Portfolio. This amount is shown as a reduction of expenses on the Statement
of Operations.
E. OTHER Purchases, maturities and sales of money market instruments are
accounted for on the date of the transaction.
2. INVESTMENT ADVISORY FEES AND ADMINISTRATIVE FEES
A. INVESTMENT ADVISORY FEE The Investment advisory fees paid to Citibank, as
compensation for overall investment management services, amounted to $899,841 of
which $520,464 was voluntarily waived for the six months ended February 29,
2000. The investment advisory fee is computed at an annual rate of 0.15% of the
Portfolio's average daily net assets.
15
<PAGE>
U.S. TREASURY RESERVES PORTFOLIO
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
B. ADMINISTRATIVE FEES Under the terms of an Administrative Services
Agreement, the administrative fee paid to the Administrator, as compensation for
overall administrative services and general office facilities, is accrued daily
and paid monthly at the annual rate of 0.05% of the Portfolio's average daily
net assets. The Administrative fees amounted to $299,947, all of which was
contractually waived for the six months ended February 29, 2000. The contractual
fee waivers terminate on December 31, 2000. The Portfolio pays no compensation
directly to any Trustee or any officer who is affiliated with the Administrator,
all of whom receive remuneration for their services to the Portfolio from the
Administrator or its affiliates. Certain of the officers and a Trustee of the
Portfolio are officers and a director of the Administrator or its affiliates.
3. INVESTMENT TRANSACTIONS Purchases, maturities and sales of U.S. Treasury
obligations, aggregated $5,191,970,429 and $5,156,117,240, respectively, for the
six months ended February 29, 2000.
4. LINE OF CREDIT The Portfolio, along with other CitiFunds, entered into an
agreement with a bank which allows the Funds collectively to borrow up to $75
million for temporary or emergency purposes. Interest on borrowings, if any, is
charged to the specific fund executing the borrowing at the base rate of the
bank. The line of credit requires a quarterly payment of a commitment fee based
on the average daily unused portion of the line of credit. For the six months
ended February 29, 2000, the commitment fee allocated to the Portfolio was
$1,815. Since the line of credit was established, there have been no borrowings.
16
<PAGE>
TRUSTEES AND OFFICERS
Philip W. Coolidge*, President
Mark T. Finn
Riley C. Gilley
William S. Woods, Jr.**
SECRETARY
Linda T. Gibson*
TREASURER
Linwood Downs*
*AFFILIATED PERSON OF ADMINISTRATOR AND DISTRIBUTOR
**TRUSTEE EMERITUS
INVESTMENT ADVISER
(OF U.S. TREASURY RESERVES PORTFOLIO)
Citibank, N.A.
153 East 53rd Street, New York, NY 10043
ADMINISTRATOR AND DISTRIBUTOR
CFBDS, Inc.
21 Milk Street, 5th Floor, Boston, MA 02109
(617) 423-1679
TRANSFER AGENT AND CUSTODIAN
State Street Bank and Trust Company
225 Franklin Street, Boston, MA 02110
AUDITORS
Deloitte & Touche LLP
200 Berkeley Street, Boston, MA 02116
LEGAL COUNSEL
Bingham Dana LLP 150 Federal Street, Boston, MA 02110
<PAGE>
- --------------------------------------------------------------------------------
THE CITIFUNDS FAMILY
LARGE CAP STOCKS
CitiFunds Growth & Income Portfolio
CitiFunds Large Cap Growth Portfolio
SMALL CAP STOCKS
CitiFunds Small Cap Growth Portfolio
CitiFunds Small Cap Value Portfolio
INTERNATIONAL STOCKS
CitiFunds International Growth & Income Portfolio
CitiFunds International Growth Portfolio
GROWTH WITH INCOME
CitiFunds Balanced Portfolio
BONDS
CitiFunds Short-Term U.S. Government Income Portfolio
CitiFunds Intermediate Income Portfolio
CitiFunds National Tax Free Income Portfolio
CitiFunds New York Tax Free Income Portfolio
CitiFunds California Tax Free Income Portfolio
MONEY MARKETS
CitiFunds Cash Reserves
CitiFunds U.S. Treasury Reserves
CitiFunds Tax Free Reserves
CitiFunds New York Tax Free Reserves
CitiFunds California Tax Free Reserves
CitiFunds Connecticut Tax Free Reserves
PREMIUM MONEY MARKETS
CitiFunds Premium Liquid Reserves
CitiFunds Premium U.S. Treasury Reserves
INSTITUTIONAL MONEY MARKETS
CitiFunds Institutional Liquid Reserves
CitiFunds Institutional U.S. Treasury Reserves
CitiFunds Institutional TaxFree Reserves
CitiFunds Institutional Cash Reserves
This report is prepared for the information of shareholders of CitiFunds Premium
U.S. Treasury Reserves. It is authorized for distribution to prospective
investors only when preceded or accompanied by an effective prospectus of
CitiFunds Premium U.S. Treasury Reserves.
For more information about any of the CitiFunds listed above, ask for a
prospectus (except for CitiFunds Premium U.S. Treasury Reserves, which preceded
or accompanies this report) containing more complete information, including all
sales charges (if any), fees and expenses. Please read the prospectus carefully
before you invest or send money.
Although each money market fund seeks to maintain the value of your investment
at $1.00 per share, it is possible to lose money by investing in the funds.
Mutual fund shares are not guaranteed or insured by the Federal Deposit
Insurance Corporation or any other government agency.
CitiFunds are made available by CFBDS, Inc. as distributor. For more information
contact your Service Agent or call 1-800-625-4554.
(C)2000 Citicorp [Logo] Printed on recycled paper CFS/PUS/200
