<PAGE> 1
[LOGO]
NATIONS INSTITUTIONAL RESERVES
[LOGO: NATIONS FUND
SEMI-ANNUAL REPORT]
NATIONS CASH RESERVES
NATIONS TREASURY RESERVES
NATIONS GOVERNMENT RESERVES
NATIONS MUNICIPAL RESERVES
FOR THE PERIOD ENDED OCTOBER 31, 1996
<PAGE> 2
<TABLE>
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<S> <C>
NOT MAY LOSE VALUE
FDIC-
INSURED NO BANK GUARANTEE
- -------------------------------------------------------------------------------------
</TABLE>
Nations Institutional Reserves Distributor: Stephens Inc. Stephens Inc., which
is not affiliated with NationsBank, N.A., is not a bank, and the securities
offered by it are not guaranteed by any bank or insured by the FDIC. Stephens
Inc., member NYSE-SIPC.
Nations Institutional Reserves Investment Adviser: NationsBanc Advisors, Inc.
Nations Institutional Reserves Investment Sub-Adviser: TradeStreet Investment
Associates, Inc.
<PAGE> 3
DEAR SHAREHOLDER:
We are pleased to present this Semi-Annual Financial Report for Nations
Institutional Reserves (the "Funds"). We hope you will take a moment to review
this report. It contains important financial information regarding your
investment for the six-month period ended October 31, 1996.
LOOKING BACK -- AN ELUSIVE ECONOMY
To tighten or not to tighten? That was the question of the summer to which most
major economic analysts claimed to have the answer. Yet, they came up short, or
rather the Federal Reserve Board (the "Fed") did. Though the early consensus
called for a Federal Funds tightening of at least 0.25% -- and some analysts
even predicted a 0.50% move -- the early economic indicators subsequently proved
to be misleading.
Second quarter data suggested a booming economy which fueled the fire for
tightening forecasts. After the June economic data release, the initial real
Gross Domestic Product ("GDP") estimate of 4.2% revised up to 4.8% as retail
sales jumped 0.7%*. With the unemployment rate low, and the capacity utilization
rate and supplier delivery speed index rising, history suggested the time was
ripe for the Fed to tighten at the August Federal Open Market Committee meeting.
The economy appeared to have grown from solid to stronger-than-expected. One
more month's worth of data would be available before the decision had to be
made.
As the July results came in, an unusually intense reversal in data suggested a
potentially slowing and self-correcting economy. Inflation seemed benign and
leading indicators slacked off. The supplier delivery speed index fell enough to
push back a possible Fed move. From July through October, the National
Association of Purchasing Management report's overall index fell significantly,
with new orders down from 61.3 to 51.6. These trends put the Fed into a holding
pattern for the time being.
LOOKING AHEAD
With GDP growth estimates down to a more modest 2.5% for the fourth quarter, it
looks like a Fed tightening will not be on the near-term horizon. However, a
rebound in economic climates may spring a series of interest-rate hikes
beginning in the second quarter of 1997. The Funds will continue to be managed
strategically to capture relative yield value along the curve within the
changing economic climate. As economic and market conditions evolve, the adviser
will attempt to position the portfolios appropriately.
SERVING YOUR SHORT-TERM INVESTMENT NEEDS
As a series of money market funds designed specifically for the needs of
institutional investors, the Funds are managed daily to provide your
organization with access to the major sectors of the money
market -- conveniently and cost effectively. We thank you for choosing Nations
Institutional Reserves to help pursue your short-term investment needs.
Sincerely,
/s/ A. Max Walker /s/ Mark H. Williamson
A. Max Walker Mark H. Williamson
President and Chairman of the Board President, NationsBanc Advisors, Inc.
October 31, 1996
MONEY MARKET FUNDS SEEK TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
HOWEVER, THERE IS NO ASSURANCE THAT MONEY MARKET FUNDS WILL BE ABLE TO MAINTAIN
A STABLE NET ASSET VALUE OF $1.00. YIELDS WILL FLUCTUATE AS MARKET CONDITIONS
CHANGE. PAST PERFORMANCE IS NOT A GUARANTEE OF FUTURE RESULTS. INVESTMENTS IN
MONEY MARKET FUNDS ARE NEITHER INSURED NOR GUARANTEED BY THE U.S. GOVERNMENT.
*SOURCE: BLOOMBERG
1
<PAGE> 4
STATEMENT OF NET ASSETS NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Maturity Value
Amount NATIONS CASH RESERVES Date (Note 1)
- ----------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
CERTIFICATES OF DEPOSIT -- DOMESTIC -- 1.2% (Cost $20,000,000)
Deutsche Bank, (New York),
$ 20,000,000 5.700%..................................................... 09/17/97 $ 20,000,000
- ----------------------------------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT -- EURO -- 1.2% (Cost $19,989,814)
Morgan Guaranty Trust Company,
20,000,000 4.920%..................................................... 02/12/97 19,989,814
- ----------------------------------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT -- YANKEE -- 11.0%
Bayerische Landesbank, (New York),
50,000,000 5.788%..................................................... 08/01/97 50,000,000
Bayerische Vereinsbank AG, (New York):
35,000,000 5.320%..................................................... 02/24/97 35,000,000
20,000,000 5.840%..................................................... 10/28/97 20,000,000
Deutsche Bank, (New York),
25,000,000 5.780%..................................................... 11/17/97 25,000,000
Sanwa Bank Ltd. of New York:
25,000,000 5.360%..................................................... 11/15/96 25,000,000
30,000,000 5.360%..................................................... 11/18/96 30,000,282
- ----------------------------------------------------------------------------------------------------------
Total Certificates of Deposit -- Yankee (Cost $185,000,282)....... 185,000,282
- ----------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER -- 39.1%
Aetna Life and Casualty Company:
20,000,000 Discount note.............................................. 01/17/97 19,756,167
10,000,000 Discount note.............................................. 04/11/97 9,739,717
Bankers Trust Company of New York:
10,000,000 Discount note.............................................. 02/18/97 9,835,592
20,000,000 Discount note.............................................. 04/15/97 19,507,750
Barnett Banks, Inc.,
15,000,000 Discount note.............................................. 11/22/96 14,953,800
Chrysler Financial Corporation,
25,000,000 Discount note.............................................. 01/28/97 24,668,778
Countrywide Funding Corporation:
20,000,000 Discount note.............................................. 11/18/96 19,950,228
14,000,000 Discount note.............................................. 11/20/96 13,960,839
15,000,000 Discount note.............................................. 12/10/96 14,914,200
Finova Capital Corporation:
10,000,000 Discount note.............................................. 11/12/96 9,983,836
20,000,000 Discount note.............................................. 11/13/96 19,964,000
15,000,000 Discount note.............................................. 11/14/96 14,971,021
7,000,000 Discount note.............................................. 11/18/96 6,982,481
5,000,000 Discount note.............................................. 11/27/96 4,979,778
10,200,000 Discount note.............................................. 01/22/97 10,074,540
</TABLE>
See Notes to Financial Statements.
2
<PAGE> 5
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Maturity Value
Amount NATIONS CASH RESERVES Date (Note 1)
- ----------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMERCIAL PAPER (continued)
General Motors Acceptance Corporation:
$ 9,000,000 Discount note.............................................. 12/04/96 $ 8,954,460
15,000,000 Discount note.............................................. 12/13/96 14,905,500
10,000,000 Discount note.............................................. 03/12/97 9,796,222
Gotham Funding Corporation,
25,000,000 Discount note(a)........................................... 02/14/97 24,597,500
GTE Corporation:
40,000,000 Discount note.............................................. 11/07/96 39,964,867
20,000,000 Discount note.............................................. 11/15/96 19,958,856
10,000,000 Discount note.............................................. 11/18/96 9,975,067
International Securitization Corporation,
9,542,000 Discount note(a)........................................... 12/27/96 9,461,847
Lehman Brothers Holdings Inc.:
20,000,000 Discount note.............................................. 11/13/96 19,964,532
9,000,000 Discount note.............................................. 01/07/97 8,904,190
Mitsubishi International Corporation:
11,000,000 Discount note.............................................. 11/08/96 10,988,600
30,000,000 Discount note.............................................. 01/03/97 29,718,075
National Bank of Canada:
20,000,000 Discount note.............................................. 11/26/96 19,931,389
10,000,000 Discount note.............................................. 03/07/97 9,802,249
15,000,000 Discount note.............................................. 06/02/97 14,486,138
New Center Asset Trust,
25,000,000 Discount note.............................................. 11/22/96 24,921,978
NYNEX Corporation:
16,500,000 Discount note.............................................. 11/18/96 16,458,704
9,997,000 Discount note.............................................. 11/22/96 9,966,093
7,000,000 Discount note.............................................. 12/16/96 6,953,624
ODC Capital Corporation,
26,217,000 Discount note.............................................. 12/04/96 26,089,629
Sumitomo Corporation of America:
25,000,000 Discount note.............................................. 11/08/96 24,973,555
15,000,000 Discount note.............................................. 11/15/96 14,968,792
14,000,000 Discount note.............................................. 12/11/96 13,915,378
22,000,000 Discount note.............................................. 12/23/96 21,829,036
7,000,000 Discount note.............................................. 01/31/97 6,903,388
TI Group Inc.,
7,000,000 Discount note(a)........................................... 04/15/97 6,826,750
Tri-Lateral Capital (USA) Inc.,
20,000,000 Discount note(a)........................................... 01/17/97 19,766,006
- ----------------------------------------------------------------------------------------------------------
Total Commercial Paper (Cost $659,225,152)......................... 659,225,152
- ----------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
3
<PAGE> 6
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Maturity Value
Amount NATIONS CASH RESERVES Date (Note 1)
- ----------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
CORPORATE OBLIGATIONS -- 13.0%
Bank of New York,
$25,000,000 5.130%..................................................... 03/07/97 $ 24,994,182
Bear Stearns Companies Inc.,
25,000,000 5.484%+.................................................... 11/04/96++ 25,000,000
Beta Finance Inc.,
25,000,000 5.570%+.................................................... 11/05/96++ 25,000,000
CS First Boston Inc.:
25,000,000 5.460%+.................................................... 11/01/96++ 25,000,000
25,000,000 5.480%+.................................................... 11/01/96++ 25,000,000
General Motors Acceptance Corporation,
25,000,000 5.480%+.................................................... 11/01/96++ 24,996,500
Lehman Brothers Holdings Inc.,
50,000,000 5.514%+.................................................... 11/08/96++ 50,000,000
Merrill Lynch & Company, Inc.,
20,000,000 5.460%+.................................................... 11/01/96++ 20,000,000
- ----------------------------------------------------------------------------------------------------------
Total Corporate Obligations (Cost $219,990,682)..................... 219,990,682
- ----------------------------------------------------------------------------------------------------------
MEDIUM TERM NOTES -- 2.4%
Bank of America,
5,700,000 7.250%..................................................... 02/03/97 5,731,442
Bear Stearns Companies Inc.,
25,000,000 5.025%..................................................... 02/10/97 25,000,000
Citicorp,
10,000,000 8.550%..................................................... 02/12/97 10,095,848
- ----------------------------------------------------------------------------------------------------------
Total Medium Term Notes (Cost $40,827,290)......................... 40,827,290
- ----------------------------------------------------------------------------------------------------------
GUARANTEED INVESTMENT CONTRACTS -- 7.4%
Jackson National Life Insurance Company,
50,000,000 5.720%#.................................................... 01/01/97++ 50,000,000
New York Life Insurance Company,
50,000,000 5.695%..................................................... 01/01/97++ 50,000,000
Peoples Security Life Insurance Company,
25,000,000 5.510%#.................................................... 11/01/96++ 25,000,000
- ----------------------------------------------------------------------------------------------------------
Total Guaranteed Investment Contracts (Cost $125,000,000)......... 125,000,000
- ----------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 4.4%
Federal Home Loan Bank, (FHLB), Note,
25,000,000 5.460%+.................................................... 11/01/96++ 25,000,000
Student Loan Marketing Association (SLMA), Note:
25,000,000 5.580%+.................................................... 11/01/96++ 25,000,000
25,000,000 5.480%+.................................................... 11/05/96++ 24,999,495
- ----------------------------------------------------------------------------------------------------------
Total U.S. Government Agency Obligations (Cost $74,999,495)........ 74,999,495
- ----------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
4
<PAGE> 7
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Maturity Value
Amount NATIONS CASH RESERVES Date (Note 1)
- --------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
U.S. TREASURY OBLIGATION -- 0.3% (Cost $5,028,114)
U.S. Treasury Note,
$ 5,000,000 8.000%..................................................... 01/15/97 $ 5,028,114
- --------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS -- 17.2%
40,000,000 Agreement with CS First Boston Corporation,
5.580% dated 10/31/96 to be repurchased at $40,006,200
on 11/01/96, collateralized by $42,045,000 FNMA Discount Notes,
due 11/19/96 - 03/03/97 (value $41,408,510)........................ 40,000,000
25,000,000 Agreement with CS First Boston Corporation,
5.625% dated 10/31/96 to be repurchased at $25,003,906
on 11/01/96, collateralized by $25,900,000 Qualified First Tier
Money Market Instruments, 5.340% due 01/27/97 (value
$25,554,235)....................................................... 25,000,000
75,000,000 Agreement with HSBC Securities,
6.000% dated 10/31/96 to be repurchased at $75,012,500
on 11/01/96, collateralized by $104,558,769 GNMA, 6.500% - 8.500%
due 05/15/11 - 10/15/26 (value $76,500,524)........................ 75,000,000
125,000,000 Agreement with Lehman Brothers Holdings Inc.,
5.600% dated 10/31/96 to be repurchased at $125,019,444
on 11/01/96, collateralized by $127,502,000 Qualified First Tier
Money Market Instruments, Zero-coupon - 5.450% due 11/01/96 -
07/18/97 (value $127,502,000)...................................... 125,000,000
25,000,000 Agreement with Merrill Lynch & Company, Inc.,
5.620% dated 10/31/96 to be repurchased at $25,003,903
on 11/01/96, collateralized by $27,000,000 Yankee Certificates of
Deposit (value $27,000,000)........................................ 25,000,000
- --------------------------------------------------------------------------------------------------------
Total Repurchase Agreements (Cost $290,000,000).................. 290,000,000
- --------------------------------------------------------------------------------------------------------
Shares
- --------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 4.1%
40,586,548 AIM Liquid Asset Portfolio........................................... 40,586,548
4,057,000 AIM Prime Fund....................................................... 4,057,000
23,507,000 Dreyfus Cash Management Plus Fund.................................... 23,507,000
435,500 Fidelity Institutional Cash Variable Rate Fund....................... 435,500
- --------------------------------------------------------------------------------------------------------
Total Money Market Funds (Cost $68,586,048)...................... 68,586,048
- --------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (Cost $1,708,646,877*)................... 101.3% $1,708,646,877
- --------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
5
<PAGE> 8
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Value
NATIONS CASH RESERVES (Note 1)
<C> <S> <C> <C>
- --------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (NET)......................... (1.3)%
Other assets......................................................... $ 8,102,394
Payable for investment securities purchased.......................... (25,000,000)
Dividends payable.................................................... (4,198,945)
Investment advisory fee payable (Note 2)............................. (161,170)
Shareholder servicing and distribution fees payable (Note 3)......... (137,403)
Accrued Trustees' fees and expenses (Note 2)......................... (44,531)
Custodian fees payable (Note 2)...................................... (31,798)
Administration fee payable (Note 2).................................. (18,420)
Accrued expenses and other payables.................................. (201,494)
- --------------------------------------------------------------------------------------------------------
TOTAL OTHER ASSETS AND LIABILITIES (NET)............................. (21,691,367)
- --------------------------------------------------------------------------------------------------------
NET ASSETS................................................. 100.0% $1,686,955,510
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Capital Class Shares:
($1,041,156,132 / 1,041,159,059 shares outstanding).................. $ 1.00
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
Liquidity Class Shares:
($129,992,695 / 129,993,060 shares outstanding)...................... $ 1.00
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
Adviser Class Shares:
($365,307,097 / 365,308,126 shares outstanding)...................... $ 1.00
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
Market Class Shares:
($150,499,586 / 150,500,020 shares outstanding)...................... $ 1.00
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
* Aggregate cost for Federal tax purposes.
+ Floating rate note. The interest rate shown reflects the rate currently in effect.
++ Reset date. Interest rates reset either daily, weekly, monthly, quarterly or semi-annually.
# Security subject to a demand feature which allows the Fund to put the security back to the
issuer from 7 to 180 calendar days.
(a) Security is not registered under the Securities Act of 1933. These securities may be resold in
transactions exempt from registration to qualified institutional buyers.
- --------------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1996 NET ASSETS CONSIST OF:
Accumulated net realized loss on investments sold.................... $ (4,755)
Paid-in capital...................................................... 1,686,960,265
- --------------------------------------------------------------------------------------------------------
NET ASSETS........................................................... $1,686,955,510
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
6
<PAGE> 9
STATEMENT OF NET ASSETS NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Maturity Value
Amount NATIONS TREASURY RESERVES Date (Note 1)
<C> <S> <C> <C>
- -------------------------------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS -- 25.3%
U.S. TREASURY BILLS -- 13.0%
$ 35,000,000 Discount note#............................................. 02/06/97 $ 34,523,083
5,000,000 Discount note#............................................. 04/03/97 4,887,375
5,000,000 Discount note.............................................. 04/10/97 4,886,111
5,000,000 Discount note.............................................. 05/01/97 4,870,535
10,000,000 Discount note#............................................. 08/21/97 9,550,733
5,000,000 Discount note.............................................. 10/16/97 4,740,552
- -------------------------------------------------------------------------------------------------------
63,458,389
- -------------------------------------------------------------------------------------------------------
U.S. TREASURY NOTES -- 10.3%
5,000,000 8.000%#.................................................... 01/15/97 5,028,114
20,000,000 6.875%#.................................................... 02/28/97 20,108,718
5,000,000 6.625%..................................................... 03/31/97 5,024,667
10,000,000 6.500%#.................................................... 04/30/97 10,027,080
5,000,000 6.125%#.................................................... 05/31/97 5,010,830
5,000,000 5.750%..................................................... 09/30/97 5,002,341
- -------------------------------------------------------------------------------------------------------
50,201,750
- -------------------------------------------------------------------------------------------------------
U.S. TREASURY STRIP -- 2.0%
10,000,000 Zero coupon................................................ 11/15/96 9,980,560
- -------------------------------------------------------------------------------------------------------
Total U.S. Treasury Obligations (Cost $123,640,699).................. 123,640,699
- -------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS -- FIXED RATE -- 81.0%
121,000,000 Agreement with Bankers Trust Company,
5.550% dated 10/31/96 to be repurchased at $121,018,654
on 11/01/96, collateralized by $43,482,000 U.S. Treasury Bills due
02/06/97 - 10/16/97; $9,945,000 U.S. Treasury Bond, 8.875% due
08/15/17; $67,096,000 U.S. Treasury Notes, 4.375% - 8.750% due
11/15/96 - 06/30/01 (value $123,469,466)........................... 121,000,000
89,667,000 Agreement with CS First Boston Corporation,
Interest is payable monthly. The agreement is terminable by the
fund daily. The final maturity of the agreement is 07/01/97,
collateralized by $20,391,000 U.S. Treasury Strips, Principal Only,
due 11/15/14 - 08/15/17; $173,720,604 U.S. Treasury Strips,
Interest Only, due 05/15/97 - 02/15/15 (value $91,462,930)##....... 89,667,000
24,000,000 Agreement with Deutsche Bank Financial Inc.,
5.550% dated 10/31/96 to be repurchased at $24,003,700
on 11/01/96, collateralized by $23,903,000 U.S. Treasury Note,
6.250% due 07/31/98 (value $24,480,975)............................ 24,000,000
24,000,000 Agreement with Dresdner Bank Inc.,
5.550% dated 10/31/96 to be repurchased at $24,003,700
on 11/01/96, collateralized by $21,645,000 U.S. Treasury Note,
7.875% due 11/15/04 (value $24,484,068)............................ 24,000,000
24,000,000 Agreement with Goldman Sachs & Company,
5.580% dated 10/31/96 to be repurchased at $24,003,720
on 11/01/96, collateralized by $27,925,000 GNMA, 7.125% due
07/20/25 (value $24,483,888)....................................... 24,000,000
</TABLE>
See Notes to Financial Statements.
7
<PAGE> 10
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS TREASURY RESERVES (Note 1)
- -------------------------------------------------------------------------------------------------------
<C> <S> <C>
REPURCHASE AGREEMENTS -- FIXED RATE (continued)
$24,000,000 Agreement with HSBC Securities,
5.600% dated 10/31/96 to be repurchased at $24,003,733
on 11/01/96, collateralized by $23,807,000 U.S. Treasury Notes,
5.500% - 7.125% due 02/29/00 - 04/30/00 (value $24,484,691)........ $ 24,000,000
9,000,000 Agreement with Lehman Brothers Holdings Inc.,
5.580% dated 10/31/96 to be repurchased at $9,001,395
on 11/01/96, collateralized by $8,485,000 U.S. Treasury Note,
7.750% due 11/30/99 (value $9,176,167)............................. 9,000,000
24,000,000 Agreement with Merrill Lynch & Company, Inc.,
5.580% dated 10/31/96 to be repurchased at $24,003,720
on 11/01/96, collateralized by $29,697,100 GNMA, 6.000% - 7.000%
due 11/20/24 - 10/20/26 (value $24,566,245)........................ 24,000,000
24,000,000 Agreement with Morgan Stanley Group Inc.,
5.580% dated 10/31/96 to be repurchased at $24,003,720
on 11/01/96, collateralized by $38,122,118 GNMA, 6.500% - 9.500%
due 07/15/07 - 10/15/26 (value $24,825,880)........................ 24,000,000
9,000,000 Agreement with Smith Barney & Company,
5.580% dated 10/31/96 to be repurchased at $9,001,395
on 11/01/96, collateralized by $8,835,000 U.S. Treasury Note,
6.500% due 05/05/15 (value $9,180,727)............................. 9,000,000
24,000,000 Agreement with UBS Securities, Inc.,
5.580% dated 10/31/96 to be repurchased at $24,003,720
on 11/01/96, collateralized by $32,609,491 GNMA, 6.500% - 7.250%
due 09/20/23 - 02/20/25 (value $24,480,897)........................ 24,000,000
- -------------------------------------------------------------------------------------------------------
Total Repurchase Agreements -- Fixed Rate (Cost $396,667,000).. 396,667,000
- -------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS -- TERM -- 9.2%
15,000,000 Agreement with CIBC Wood Gundy Securities Corporation,
5.250%, terminable by the Portfolio daily, with a final maturity
date of 12/16/96. Interest receivable as of 10/31/96 was $4,375
collateralized by $15,120,000 U.S. Treasury Note, 6.875% due
03/31/97 (value $15,303,029)....................................... 15,000,000
15,000,000 Agreement with Lehman Brothers Holdings Inc.,
5.280%, terminable by the Portfolio daily, with a final maturity
date of 11/04/96. Interest receivable as of 10/31/96 was $63,800
collateralized by $78,845,000 U.S. Treasury Strips, Principal Only,
due 08/15/20 (value $15,300,661)................................... 15,000,000
</TABLE>
See Notes to Financial Statements.
8
<PAGE> 11
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS TREASURY RESERVES (Note 1)
- -------------------------------------------------------------------------------------------------------
<C> <S> <C>
REPURCHASE AGREEMENTS -- TERM (continued)
$15,000,000 Agreement with Smith Barney & Company,
5.280%, terminable by the Portfolio daily, with a final maturity
date of 11/04/96. Interest receivable as of 10/31/96 was $63,800
collateralized by $14,789,000 U.S. Treasury Note, 7.250% due
02/15/98 (value $15,300,564)....................................... $ 15,000,000
- -------------------------------------------------------------------------------------------------------
Total Repurchase Agreements -- Term (Cost $45,000,000)......... 45,000,000
- -------------------------------------------------------------------------------------------------------
Shares
- -------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 3.1%
9,155,000 AIM Treasury Fund.................................................... 9,155,000
2,301,000 Dreyfus Treasury Cash Management Fund................................ 2,301,000
3,837,000 Fidelity Institutional Cash Fund..................................... 3,837,000
- -------------------------------------------------------------------------------------------------------
Total Money Market Funds (Cost $15,293,000).................... 15,293,000
- -------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (Cost $580,600,699*)..................... 118.6% 580,600,699
- -------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (NET)......................... (18.6)%
Other assets......................................................... 808,946
Payable for reverse repurchase agreement (Note 1).................... (89,667,000)
Dividends payable.................................................... (2,054,519)
Shareholder servicing and distribution fees payable (Note 3)......... (51,527)
Investment advisory fee payable (Note 2)............................. (37,051)
Accrued Trustees' fees and expenses.................................. (24,066)
Custodian fees payable (Note 2)...................................... (23,920)
Administration fee payable (Note 2).................................. (6,091)
Accrued expenses and other payables.................................. (52,429)
- -------------------------------------------------------------------------------------------------------
TOTAL OTHER ASSETS AND LIABILITIES (NET)............................. (91,107,657)
- -------------------------------------------------------------------------------------------------------
NET ASSETS................................................. 100.0% $ 489,493,042
=======================================================================================================
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Capital Class Shares:
($261,106,002 / 261,121,303 shares outstanding)...................... $ 1.00
=======================================================================================================
Liquidity Class Shares:
($7,417,200 / 7,417,636 shares outstanding).......................... $ 1.00
=======================================================================================================
Adviser Class Shares:
($143,174,389 / 143,182,780 shares outstanding)...................... $ 1.00
=======================================================================================================
Market Class Shares:
($77,795,451 / 77,800,010 shares outstanding)........................ $ 1.00
=======================================================================================================
</TABLE>
See Notes to Financial Statements.
9
<PAGE> 12
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
NATIONS TREASURY RESERVES
- --------------------------------------------------------------------------------------------------------
<C> <S>
* Aggregate cost for Federal tax purposes.
+ Rate resets daily. The interest rate shown reflects the rate currently in effect.
# Denotes securities subject to repurchase under reverse repurchase agreements as of October 31,
1996 (Note 1).
## Security segregated as collateral for reverse repurchase agreement.
- --------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C>
AT OCTOBER 31, 1996 NET ASSETS CONSIST OF:
Accumulated net realized loss on investments sold....................... $ (27,839)
Paid-in capital......................................................... 489,520,881
- --------------------------------------------------------------------------------------------------------
NET ASSETS.............................................................. $489,493,042
========================================================================================================
</TABLE>
See Notes to Financial Statements.
10
<PAGE> 13
STATEMENT OF NET ASSETS NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Maturity Value
Amount NATIONS GOVERNMENT RESERVES Date (Note 1)
- ------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 63.2%
FEDERAL FARM CREDIT BANK (FFCB) NOTES -- 7.7%
$ 5,000,000 5.300%+................................................... 11/01/96++ $ 4,998,747
5,000,000 5.300%+................................................... 11/01/96++ 4,998,226
5,000,000 5.600%.................................................... 06/03/97 4,995,896
5,000,000 5.840%.................................................... 06/18/97 4,995,198
- ------------------------------------------------------------------------------------------------------
19,988,067
- ------------------------------------------------------------------------------------------------------
FEDERAL HOME LOAN BANK (FHLB) -- 13.7%
4,000,000 Discount note............................................. 11/14/96 3,992,532
Notes:
10,000,000 5.460%+................................................... 11/01/96++ 10,000,000
3,000,000 4.860%.................................................... 02/07/97 2,999,180
5,000,000 5.265%.................................................... 03/13/97 5,000,000
3,000,000 5.392%.................................................... 03/18/97 3,000,000
2,605,000 5.400%.................................................... 03/20/97 2,604,310
4,000,000 5.850%.................................................... 11/06/97 4,000,000
4,000,000 5.800%.................................................... 11/07/97 4,000,000
- ------------------------------------------------------------------------------------------------------
35,596,022
- ------------------------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) -- 12.0%
3,000,000 Discount note............................................. 11/14/96 2,994,340
3,000,000 Discount note............................................. 11/19/96 2,992,230
3,000,000 Discount note............................................. 11/20/96 2,991,799
6,000,000 Discount note............................................. 11/21/96 5,982,708
8,000,000 Discount note............................................. 12/11/96 7,953,756
2,580,000 Discount note............................................. 01/02/97 2,556,761
3,000,000 Discount note............................................. 01/07/97 2,970,799
3,000,000 Discount note............................................. 01/16/97 2,966,813
- ------------------------------------------------------------------------------------------------------
31,409,206
- ------------------------------------------------------------------------------------------------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) -- 6.4%
3,000,000 Discount note............................................. 12/09/96 2,983,533
3,000,000 Discount note............................................. 12/27/96 2,975,780
3,000,000 Discount note............................................. 03/18/97 2,937,208
3,000,000 Discount note............................................. 09/08/97 2,862,124
Note,
5,000,000 5.340%+................................................... 11/05/96++ 4,998,567
- ------------------------------------------------------------------------------------------------------
16,757,212
- ------------------------------------------------------------------------------------------------------
STUDENT LOAN MARKETING ASSOCIATION (SLMA) -- 23.4%
3,000,000 Discount note............................................. 12/18/96 2,979,555
Notes:
10,000,000 5.580%+................................................... 11/01/96++ 10,000,000
20,000,000 5.350%+................................................... 11/05/96++ 19,971,440
10,000,000 5.360%+................................................... 11/05/96++ 9,997,127
</TABLE>
See Notes to Financial Statements.
11
<PAGE> 14
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Maturity Value
Amount NATIONS GOVERNMENT RESERVES Date (Note 1)
- ------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
STUDENT LOAN MARKETING ASSOCIATION (SLMA) (continued)
$ 8,000,000 5.370%+................................................... 11/05/96++ $ 8,000,000
5,000,000 5.480%+................................................... 11/05/96++ 4,999,874
5,000,000 5.870%.................................................... 06/30/97 5,004,678
- ------------------------------------------------------------------------------------------------------
60,952,674
- ------------------------------------------------------------------------------------------------------
Total U.S. Government Agency Obligations (Cost $164,703,181)...... 164,703,181
- ------------------------------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS -- 5.8%
U.S. Treasury Notes:
5,000,000 6.250%.................................................... 01/31/97 5,014,051
5,000,000 6.750%.................................................... 02/28/97 5,025,401
5,000,000 6.500%.................................................... 04/30/97 5,013,540
- ------------------------------------------------------------------------------------------------------
Total U.S. Treasury Obligations (Cost $15,052,992)................ 15,052,992
- ------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT -- FIXED RATE -- 26.0%
12,000,000 Agreement with Lehman Brothers Holdings Inc.,
5.580% dated 10/31/96 to be repurchased at $12,001,860
on 11/01/96, collateralized by $8,085,000 FNMA, 7.990%
due 11/01/96; $4,360,000 FNMA Strips due 11/13/96 -
06/20/97 (value $12,240,665)........................... 12,000,000
55,913,000 Agreement with CS First Boston Corporation,
5.580% dated 10/31/96 to be repurchased at $55,921,667
on 11/01/96, collateralized by $54,525,000 U.S. Treasury
Notes, 5.000% - 8.500% due 11/30/96 - 02/15/05
(value $57,947,836)..................................... 55,913,000
- ------------------------------------------------------------------------------------------------------
Total Repurchase Agreements -- Fixed Rate (Cost $67,913,000)...... 67,913,000
- ------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT -- TERM -- 7.7% (Cost $20,000,000)
20,000,000 Agreement with Smith Barney & Company,
5.280%** terminable by the Portfolio daily, with a final
maturity date of 11/04/96. Interest receivable as of
10/31/96 was $85,067, collateralized by $8,579,000 U.S.
Treasury Note, 6.500% due 05/15/05; $19,169,000 U.S.
Treasury Strips, Interest Only, due 10/15/04 (value
$20,400,199)............................................ 20,000,000
- ------------------------------------------------------------------------------------------------------
Shares
- ------------------------------------------------------------------------------------------------------
MONEY MARKET FUND -- 0.2% (Cost $528,000)
528,000 Fidelity Institutional Cash Fund...................................... 528,000
- ------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (Cost $268,197,173*).................... 102.9 % 268,197,173
- ------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
12
<PAGE> 15
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
NATIONS GOVERNMENT RESERVES
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
OTHER ASSETS AND LIABILITIES (NET)........................ (2.9)%
Other assets.......................................................... $ 1,614,126
Payable for investment securities purchased........................... (8,000,000)
Dividends payable..................................................... (894,641)
Shareholder servicing and distribution fees payable (Note 3).......... (61,684)
Investment advisory fee payable (Note 2).............................. (15,342)
Accrued Trustees' fees and expenses (Note 2).......................... (8,422)
Custodian fees payable (Note 2)....................................... (7,106)
Administration fee payable (Note 2)................................... (2,817)
Accrued expenses and other payables................................... (62,573)
- ------------------------------------------------------------------------------------------------------
TOTAL OTHER ASSETS AND LIABILITIES (NET).............................. (7,438,459)
- ------------------------------------------------------------------------------------------------------
NET ASSETS................................................ 100.0 % $260,758,714
- ------------------------------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Capital Class Shares:
($44,203,793 / 44,204,267 shares outstanding)......................... $ 1.00
======================================================================================================
Liquidity Class Shares:
($700,692 / 700,700 shares outstanding)............................... $ 1.00
======================================================================================================
Adviser Class Shares:
($22,056,338 / 22,056,578 shares outstanding)......................... $ 1.00
======================================================================================================
Market Class Shares:
($193,797,891 / 193,800,020 shares outstanding)....................... $ 1.00
======================================================================================================
<FN>
* Aggregate cost for Federal tax purposes
** Rate resets daily. The interest rate shown reflects the rate currently in
effect.
+ Floating rate note. The interest rate shown reflects the rate currently in
effect.
++ Reset date.
</TABLE>
<TABLE>
- ------------------------------------------------------------------------------------------------------
<S> <C>
AT OCTOBER 31, 1996 NET ASSETS CONSIST OF:
Accumulated net realized loss on investments sold..................... $ (2,062)
Paid-in capital....................................................... 260,760,776
- ------------------------------------------------------------------------------------------------------
NET ASSETS............................................................ $260,758,714
======================================================================================================
</TABLE>
See Notes to Financial Statements.
13
<PAGE> 16
STATEMENT OF NET ASSETS NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS MUNICIPAL RESERVES (Note 1)
- -----------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES -- 97.5%
ALABAMA -- 5.9%
Columbia, Alabama, Industrial Development Board, PCR, (Alabama Power
Company Project), Series A,
$2,200,000 3.650% due 05/01/22+.................................................. $ 2,200,000
Fort Payne, Alabama, Industrial Development Board, Industrial Development
Revenue, (Brookwood Expansion Project), (AmSouth Bank N.A., Birmingham
LOC),
1,300,000 3.700% due 12/01/97++................................................. 1,300,000
Gadsden, Alabama, Industrial Development Board, PCR, (Alabama Power
Company Project),
1,900,000 3.650% due 06/01/15+.................................................. 1,900,000
Homewood, Alabama, Education Building Authority, Educational Facilities,
(Samford University), Series C, (AmSouth Bank N.A., Birmingham LOC),
1,265,000 3.600% due 12/01/13++................................................. 1,265,000
McIntosh, Alabama, Industrial Development Board, PCR, (Ciba-Geigy
Corporation Project), Series A, (Swiss Bank LOC),
2,200,000 3.550% due 12/01/03++................................................. 2,200,000
Mobile, Alabama, Industrial Development Board, PCR, (Alabama Power
Company Project),
3,000,000 3.650% due 06/01/15+.................................................. 3,000,000
Parrish, Alabama, Industrial Development Board, PCR, (Alabama Power
Company Project),
1,400,000 3.650% due 06/01/15+.................................................. 1,400,000
- -----------------------------------------------------------------------------------------------------
13,265,000
- -----------------------------------------------------------------------------------------------------
ALASKA -- 0.8%
Valdez, Alaska, Marine Terminal Revenue, (Arco Transportation Project),
Series B,
1,900,000 3.650% due 05/01/31++................................................. 1,900,000
- -----------------------------------------------------------------------------------------------------
ARIZONA -- 1.3%
Glendale, Arizona, United High School District, No. 205, TAN, Series A,
2,000,000 4.400% due 07/31/97................................................... 2,005,745
Pinal (County of), Arizona, Industrial Development Authority, PCR,
(Magma Copper Company Project), (Banque Nationale de Paris LOC),
1,000,000 3.550% due 12/01/11++................................................. 1,000,000
- -----------------------------------------------------------------------------------------------------
3,005,745
- -----------------------------------------------------------------------------------------------------
ARKANSAS -- 1.0%
Little Rock, Arkansas, Metrocenter, Improvement District No. 1 Revenue,
(Little Rock Newspapers Inc. Project), (Bank of New York, N.Y. LOC),
2,300,000 3.650% due 12/01/25+.................................................. 2,300,000
- -----------------------------------------------------------------------------------------------------
CALIFORNIA -- 4.3%
Los Angeles, California, Regional Airports Improvement Corporation Lease
Revenue, (Societe Generale de France LOC),
5,600,000 3.650% due 12/01/25+.................................................. 5,600,000
San Bernardino (County of), California, TRAN, GO, (Toronto Dominion
Bank, Landesbank Hessen LOC),
3,000,000 4.500% due 06/30/97................................................... 3,011,918
</TABLE>
See Notes to Financial Statements.
14
<PAGE> 17
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS MUNICIPAL RESERVES (Note 1)
- -----------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (continued)
CALIFORNIA (continued)
San Diego, California, Industrial Development Revenue, (Kaiser Aerospace
and Electrical Project), Series A, AMT, (ABN-AMRO Bank LOC),
$1,200,000 3.700% due 10/01/07++................................................. $ 1,200,000
- -----------------------------------------------------------------------------------------------------
9,811,918
- -----------------------------------------------------------------------------------------------------
COLORADO -- 2.8%
Colorado (State of), Health Facilities Authority Revenue, (Goodwill
Industries), (Bank One of Denver LOC),
1,835,000 3.600% due 12/01/04++................................................. 1,835,000
Colorado (State of), Post Secondary Educational Authority, Economic
Development Revenue, (U.S. Swimming), (Bank One LOC),
1,400,000 3.650% due 06/01/11++................................................. 1,400,000
Colorado (State of), Student Obligation Authority, Student Loan Revenue,
Series B, AMT, (Student Loan Marketing Association LOC),
2,000,000 3.600% due 07/01/20++................................................. 2,000,000
Larimer (County of), Colorado, Industrial Development Revenue, (Ultimate
Support System Project), Series A, (Bank One of Denver LOC),
1,150,000 3.600% due 06/01/10++................................................. 1,150,000
- -----------------------------------------------------------------------------------------------------
6,385,000
- -----------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA -- 1.6%
District of Columbia, Hospital Revenue, (Columbia Women's Hospital),
Series A, (Mitsubishi Bank Ltd. LOC),
1,500,000 3.700% due 07/01/20++................................................. 1,500,000
District of Columbia Revenue, (Georgetown University), Series D,
(Bayerische Landesbank LOC),
2,100,000 3.550% due 04/01/17++................................................. 2,100,000
- -----------------------------------------------------------------------------------------------------
3,600,000
- -----------------------------------------------------------------------------------------------------
FLORIDA -- 4.7%
Brevard (County of), Florida, Multi-family Housing Authority Revenue,
(Malabar Lakes & Park Village), Series A, (First Bank, Minneapolis
LOC),
2,575,000 3.650% due 12/01/10++................................................. 2,575,000
Fort Walton Beach, Florida, Industrial Development Revenue, (Burton Golf
Inc. Project), AMT, (Columbus Bank & Trust Company LOC),
2,000,000 3.800% due 10/01/11++................................................. 2,000,000
Jacksonville, Florida, Health Facilities Authority, (Baptist Health
Properties Project), (Barnett Bank (Jacksonville) LOC),
2,500,000 3.650% due 06/01/20+.................................................. 2,500,000
Orange (County of), Florida, Health Facilities Authority Revenue,
(Mayflower Retirement Community Project), (Rabobank Nederland LOC),
1,000,000 3.650% due 03/01/18++................................................. 1,000,000
Orange (County of), Florida, Housing Finance Agency, Series B, AMT,
2,500,000 3.650% due 04/01/97................................................... 2,500,000
- -----------------------------------------------------------------------------------------------------
10,575,000
- -----------------------------------------------------------------------------------------------------
GEORGIA -- 7.0%
Clayton (County of), Georgia, Multi-family Housing Authority Revenue:
(Rolling Hills Apartments Project), (AmSouth Bank N.A., Birmingham
LOC),
1,820,000 3.700% due 06/15/17++................................................. 1,820,000
</TABLE>
See Notes to Financial Statements.
15
<PAGE> 18
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS MUNICIPAL RESERVES (Note 1)
- -----------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (continued)
GEORGIA (continued)
Clayton (County of), Georgia, Multi-family Housing Authority Revenue
(continued):
(Ten Oaks Apartments Project), Series F, (FSA Insured),
(Barclays Bank Plc LOC),
$1,760,000 3.550% due 01/01/21++................................................. $ 1,760,000
Cobb (County of), Georgia, Residential Care Facilities Authority
Revenue, (Presbyterian Homes Project), (Trust Company Bank LOC),
3,800,000 3.600% due 08/01/18++................................................. 3,800,000
Crisp County-Cordele, Georgia, Industrial Development Authority Revenue,
(Florida Seed Company Inc. Project), AMT,
(SouthTrust Bank of Alabama LOC),
1,200,000 3.850% due 12/01/10++................................................. 1,200,000
De Kalb (County of), Georgia, Housing Authority, Multi-family Housing
Revenue: (Camden Brook Project), (FNMA Insured),
2,800,000 3.550% due 06/15/25++................................................. 2,800,000
(Cedar Creek Apartments Project), AMT,
(General Electric Capital Corporation Insured),
1,400,000 3.900% due 12/01/20++................................................. 1,400,000
(Terrace Club Project), Series A, (AmSouth Bank N.A. LOC),
1,000,000 3.700% due 11/01/15++................................................. 1,000,000
Smyrna, Georgia, Multi-family Housing Authority Revenue, (Hills of Post
Village Project), (FNMA Collateral Agreement),
2,000,000 3.550% due 06/01/25++................................................. 2,000,000
- -----------------------------------------------------------------------------------------------------
15,780,000
- -----------------------------------------------------------------------------------------------------
ILLINOIS -- 13.2%
Burbank, Illinois, Industrial Development Revenue, (Service Merchandise,
Inc. Project), (Canadian Imperial Bank of Commerce LOC),
400,000 3.650% due 09/15/24+++................................................ 400,000
Chicago, Illinois, O'Hare International Airport, American Airlines Inc.:
Series A, (Westdeutsche Landesbank LOC),
6,800,000 3.650% due 12/01/17+.................................................. 6,800,000
Series C, (Royal Bank of Canada LOC),
1,300,000 3.650% due 12/01/17+.................................................. 1,300,000
Series D, (Royal Bank of Canada LOC),
800,000 3.650% due 12/01/17+.................................................. 800,000
Illinois (State of), Development Finance Authority Revenue:
(Chicago Symphony Orchestra), (Northern Trust Company LOC),
2,000,000 3.600% due 12/01/28++................................................. 2,000,000
(Residential Rental River Oaks Project), AMT, (Swiss Bank Corporation
LOC),
1,500,000 3.600% due 12/15/19++................................................. 1,500,000
Illinois (State of), Development Financial Authority, Industrial
Development Revenue:
(Quality Screw & Nut Company Project), AMT, (National Bank of Detroit
LOC),
1,700,000 3.750% due 05/01/15++................................................. 1,700,000
(Randolph Pickle Corporation Project), (American National Bank and
Trust Company (Chicago) LOC),
800,000 3.800% due 06/01/12++................................................. 800,000
</TABLE>
See Notes to Financial Statements.
16
<PAGE> 19
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS MUNICIPAL RESERVES (Note 1)
- -----------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (continued)
ILLINOIS (continued)
Illinois (State of), Development Financial Authority, Industrial
Development Revenue (continued):
(Unique Building Corporation Project), AMT, (American National Bank and
Trust Company (Chicago) LOC),
$1,200,000 3.800% due 05/01/09++................................................. $ 1,200,000
Illinois (State of), Education Facilities Authority Revenue,
(Northwestern University, First National Bank (Chicago) SBPA),
1,400,000 3.650% due 12/01/25++................................................. 1,400,000
Illinois (State of), Health Facilities Authority Revenue:
Health, Hospital & Nursing Home Improvements, (Streeterville
Corporation Project), Series B, (First National Bank (Chicago) LOC),
1,000,000 3.600% due 08/15/23++................................................. 1,000,000
(Multi-family Park Plaza Center), (ABN-AMRO Bank LOC),
3,000,000 3.600% due 09/15/20++................................................. 3,000,000
(Resurrection Health Care Systems), (First National Bank of Chicago,
NBD Bank, Comerica Bank, Lasalle Bank (SBPA)),
4,500,000 3.650% due 05/01/11+.................................................. 4,500,000
(Victory Health Project), Series C,
2,000,000 3.600% due 12/05/96................................................... 2,000,000
Lombard Village, Illinois, Industrial Project Revenue, B&H Partnership,
(Comerica Bank LOC),
1,500,000 3.875% due 10/01/13++................................................. 1,500,000
- -----------------------------------------------------------------------------------------------------
29,900,000
- -----------------------------------------------------------------------------------------------------
INDIANA -- 3.0%
Auburn, Indiana, Economic Development Revenue, (RJ Tower Corporation
Project), AMT, (Comerica Bank LOC),
1,680,000 3.900% due 09/01/00++................................................. 1,680,000
Carmel Clay, Indiana, Schools Tax Anticipation Warrants, Transportation
Fund,
1,200,000 3.740% due 12/31/96................................................... 1,200,264
Indiana Bond Bank, Advance Funding Notes,
650,000 4.250% due 01/09/97................................................... 650,860
Indianapolis, Indiana, Local Public Improvement, Bond Bank Notes,
Series A,
830,000 6.669% due 12/01/96................................................... 830,000
Indianapolis, Indiana, Multi-family Housing Revenue, (Canal Square
Project),
1,300,000 3.500% due 12/01/15++................................................. 1,300,000
Kendallville, Indiana, Revenue, (McCray Memorial Hospital Project),
(First National Bank (Chicago) LOC),
1,085,000 3.650% due 01/01/04++................................................. 1,085,000
- -----------------------------------------------------------------------------------------------------
6,746,124
- -----------------------------------------------------------------------------------------------------
IOWA -- 2.2%
Iowa (State of), School Corporations, Warrant Certificates:
(Iowa School Cash Anticipation Program), Series B, (FSA Insured),
2,000,000 4.250% due 01/30/97................................................... 2,004,050
Series A, (FSA Insured),
3,000,000 4.750% due 06/27/97................................................... 3,015,043
- -----------------------------------------------------------------------------------------------------
5,019,093
- -----------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
17
<PAGE> 20
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS MUNICIPAL RESERVES (Note 1)
- -----------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (continued)
KENTUCKY -- 3.5%
Daviess (County of), Kentucky, Solid Waste Disposal Facilities Revenue,
(Scott Paper Company Project), Series B, AMT, (Kimberly Clark
Guaranteed),
$3,700,000 3.800% due 05/01/24+.................................................. $3,700,000
Jefferson (County of), Kentucky, Industrial Building Revenue, (Seven
Counties Services Inc. Project), (Bank One LOC),
1,595,000 3.600% due 06/01/11++................................................. 1,595,000
Jefferson (County of), Kentucky, Industrial Development Revenue,
(Belknap Inc. Project), (Chemical Bank LOC),
1,296,000 3.450% due 12/01/14+++................................................ 1,296,000
Jeffersontown, Kentucky, Industrial Building Revenue, (Raque Food System
Inc. Project), AMT, (PNC Bank LOC),
1,300,000 3.850% due 04/01/20++................................................. 1,300,000
- ---------------------------------------------------------------------------------------------------
7,891,000
- ---------------------------------------------------------------------------------------------------
MARYLAND -- 1.0%
Montgomery (County of), Maryland, Industrial Development Revenue,
(Information Systems and Network Corporation Project), (PNC Bank LOC),
200,000 3.550% due 04/01/14+++................................................ 200,000
Prince Georges (County of), Maryland, Housing Authority Mortgage
Revenue, (Laurel-Oxford Project), (Bankers Trust Company LOC),
2,000,000 3.625% due 10/01/07++................................................. 2,000,000
- ---------------------------------------------------------------------------------------------------
2,200,000
- ---------------------------------------------------------------------------------------------------
MISSISSIPPI -- 1.1%
Flowood, Mississippi, Industrial Development Revenue, (BSC Steel Inc.
Project), AMT, (PNC Bank LOC),
2,500,000 3.900% due 11/01/01++................................................. 2,500,000
- ---------------------------------------------------------------------------------------------------
MONTANA -- 0.4%
Billings, Montana, Industrial Development Revenue, (CFS-Continental
Project),
(Toronto Dominion Bank LOC),
1,000,000 3.600% due 12/01/14++................................................. 1,000,000
- ---------------------------------------------------------------------------------------------------
NEBRASKA -- 0.5%
Omaha, Nebraska, Auditorium Facilities Corporation Lease Revenue, (Omaha
Civic Auditorium Project),
1,095,000 3.850% due 08/15/97................................................... 1,093,676
- ---------------------------------------------------------------------------------------------------
NORTH DAKOTA -- 0.4%
Mercer (County of), North Dakota, Solid Waste Disposal Revenue, AMT,
National Rural Utilities, Series A, (CFC Insured),
1,000,000 3.700% due 03/01/97................................................... 1,000,000
- ---------------------------------------------------------------------------------------------------
OHIO -- 2.8%
Centerville, Ohio, Health Care Revenue, (Bethany Lutheran Village
Project), (PNC Bank of Ohio LOC),
1,000,000 3.550% due 11/01/13++................................................. 1,000,000
Cuyhoga (County of), Ohio, Industrial Development Revenue, (Pleasant
Lake Project), (Key Bank, N.A. LOC),
990,000 3.650% due 05/01/11++................................................. 990,000
</TABLE>
See Notes to Financial Statements.
18
<PAGE> 21
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS MUNICIPAL RESERVES (Note 1)
- -----------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (continued)
OHIO (continued)
Greene (County of), Ohio, Industrial Development Revenue, (AFC Stamping
Project), AMT, (Key Bank, N.A. LOC),
$1,000,000 3.800% due 09/01/16++................................................. $1,000,000
Ohio (State of), Housing Finance Agency, Multi-family Housing Revenue,
Kenwood Congregate Retirement Community, (Morgan Guaranty Trust
Company LOC),
2,355,000 3.500% due 12/01/15+++................................................ 2,355,000
Trumbull (County of), Ohio, Industrial Development Revenue,
(ATD Corporation Project), AMT, (Key Bank, N.A. LOC),
1,000,000 3.800% due 08/01/10++................................................. 1,000,000
- -----------------------------------------------------------------------------------------------------
6,345,000
- -----------------------------------------------------------------------------------------------------
OKLAHOMA -- 0.4%
Tulsa (County of), Oklahoma, Independent School District No. 5, GO,
(AMBAC Insured),
1,000,000 5.200% due 04/01/97................................................... 1,007,640
- -----------------------------------------------------------------------------------------------------
PENNSYLVANIA -- 3.6%
Chester (County of), Pennsylvania, Industrial Development Revenue,
(Keystone Foods Corporation Project), (Bank of Scotland LOC),
400,000 3.950% due 10/15/99+++................................................ 400,000
Delaware (County of), Pennsylvania, Industrial Development Authority, PCR,
(BP Oil Inc. Project):
2,800,000 3.650% due 12/01/09+.................................................. 2,800,000
2,700,000 3.650% due 10/01/19+.................................................. 2,700,000
Schuylkill (County of), Pennsylvania, Industrial Development Authority
Revenue, Industrial Development, (PNC Bank LOC):
(Bon-Ton Stores Project), AMT,
1,000,000 3.850% due 02/01/12++................................................. 1,000,000
(Grumbacher & Son Project),
1,240,000 3.650% due 02/01/12++................................................. 1,240,000
- -----------------------------------------------------------------------------------------------------
8,140,000
- -----------------------------------------------------------------------------------------------------
SOUTH CAROLINA -- 3.4%
Cherokee (County of), South Carolina, Industrial Development Revenue,
(Holmberg Electric Corporation Project), (Wachovia Bank LOC),
1,000,000 3.600% due 11/01/04++................................................. 1,000,000
South Carolina (State of), Housing Authority, Rental Housing Revenue,
(Hampton Pointe Apartment Project), (Bank of New York LOC),
5,000,000 3.750% due 12/01/07++................................................. 5,000,000
South Carolina (State of), Jobs, Economic Development Authority Revenue,
(Spartanburg Young Mens Project), (First Union National Bank LOC),
1,800,000 3.650% due 06/01/18++................................................. 1,800,000
- -----------------------------------------------------------------------------------------------------
7,800,000
- -----------------------------------------------------------------------------------------------------
SOUTH DAKOTA -- 0.4%
South Dakota (State of), Economic Development Finance Authority,
Industrial Development Revenue, (Lomar Development Company Project),
Series B, AMT, (First Bank LOC),
930,000 4.000% due 08/01/08++................................................. 930,000
- -----------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
19
<PAGE> 22
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS MUNICIPAL RESERVES (Note 1)
- -----------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (continued)
TENNESSEE -- 5.1%
Chattanooga, Tennessee, Industrial Development Board, (Seaboard Farms of
Chattanooga Project), (Bank of Nova Scotia LOC),
$2,000,000 3.550% due 06/01/04++................................................. $ 2,000,000
Jefferson City, Tennessee, Industrial Development Board, (BA Property
Project), AMT, (American National Bank and Trust Company (Chicago)
LOC),
1,000,000 3.700% due 11/01/24++................................................. 1,000,000
Jefferson (County of), Tennessee, Industrial Development Board, Economic
Development Revenue, (Ball Corporation Project), AMT, (PNC Bank LOC),
1,000,000 3.850% due 04/01/98++................................................. 1,000,000
Knoxville, Tennessee, Refunding & Improvement Revenue, GO, Series A,
(MBIA Insured),
2,505,000 3.800% due 05/01/97................................................... 2,505,000
Memphis, Tennessee, Capital Outlay Notes, GO,
1,770,000 5.000% due 07/01/97................................................... 1,782,519
Metropolitan Nashville Airport Authority, Special Facilities Revenue,
(American Airlines Inc., Project), Series B, (Bayerische Landesbank
LOC),
1,300,000 3.650% due 10/01/12+.................................................. 1,300,000
Springfield, Tennessee, Industrial Development Board, All American Homes
of Tennessee, AMT, (NBD Bank LOC),
1,900,000 3.750% due 11/15/09++................................................. 1,900,000
- -----------------------------------------------------------------------------------------------------
11,487,519
- -----------------------------------------------------------------------------------------------------
TEXAS -- 8.7%
Austin (County of), Texas, Industrial Development Corporation,
Industrial Development Revenue, (Justin Industries Inc. Project),
(Citibank LOC),
1,900,000 3.600% due 12/01/14++................................................. 1,900,000
Dallas, Texas, GO, Pre-refunded,
1,000,000 7.000% due 02/15/97................................................... 1,024,658
Harris (County of), Texas, Health Facilities Development Corporation,
Hospital Revenue, (St. Luke's Episcopal Hospital), Series A,
1,550,000 3.650% due 02/15/21+.................................................. 1,550,000
Harris (County of), Texas, (Toll Road Multimode Project), Senior Lien,
Series A, Pre-refunded,
2,000,000 7.450% due 02/15/97................................................... 2,082,389
Lubbock, Texas, Health Facilities Development Corporation Revenue,
(Charter Plains Hospital), (Bankers Trust Company LOC),
2,000,000 3.600% due 10/01/13++................................................. 2,000,000
Nueces (County of), Texas, Health Facilities Development Corporation
Revenue, (Driscoll Foundation Children's Project), (Bank One of Texas
LOC),
1,200,000 3.600% due 07/01/15++................................................. .1,200,000
Sabine River Authority, Texas, PCR, Daily Collection, (Texas Utilities
Electric Company Project), Series A, (AMBAC Insured), (Bank of New
York SBPA),
2,300,000 3.600% due 03/01/26+.................................................. 2,300,000
Texas (State of), TRAN, Series A,
3,000,000 4.750% due 08/29/97................................................... 3,019,028
</TABLE>
See Notes to Financial Statements.
20
<PAGE> 23
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS MUNICIPAL RESERVES (Note 1)
- -----------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (continued)
TEXAS (continued)
Trinity River, Texas, Industrial Development Authority, Industrial
Development Revenue Bond, (Toys "R" Us Project), Series 1994, (Bankers
Trust Company LOC),
$1,000,000 3.625% due 11/01/14++................................................. $ 1,000,000
West Side Calhoun (County of), Texas, Development Corporation, PCR,
(BP Oil Inc. Project),
3,600,000 3.650% due 12/01/15+.................................................. 3,600,000
- -----------------------------------------------------------------------------------------------------
19,676,075
- -----------------------------------------------------------------------------------------------------
UTAH -- 4.4%
Murray City, Utah, Industrial Development Revenue, (Zevex Inc. Project),
AMT, (Bank One LOC),
2,000,000 3.750% due 10/01/16++................................................. 2,000,000
Salt Lake City, Utah, Housing Authority, Sandy Retirement Center,
(Morgan Guaranty Trust Company, New York LOC),
1,000,000 3.500% due 01/01/09++................................................. 1,000,000
Salt Lake City, Utah, Industrial Development Revenue, (SPS Technologies
Inc. Project), AMT, (National Australia Bank LOC),
4,500,000 3.850% due 12/01/12++................................................. 4,500,000
Utah (County of), Utah, Industrial Development Revenue, (McWare Inc.
Project), (AmSouth Bank N.A. (Birmingham) LOC),
1,380,000 3.700% due 02/01/98++................................................. 1,380,000
West Valley City, Utah, Industrial Development Revenue, (Johnson Mattney
Inc. Project), (Canadian Imperial Bank of Commerce LOC),
1,200,000 3.750% due 12/01/11+.................................................. 1,200,000
- -----------------------------------------------------------------------------------------------------
10,080,000
- -----------------------------------------------------------------------------------------------------
VIRGINIA -- 5.9%
Albemarle (County of), Virginia, Industrial Development Authority,
Health Services Revenue, (University of Virginia Services Foundation),
(First Union National Bank (North Carolina) LOC),
5,000,000 3.650% due 02/01/26++................................................. 5,000,000
Bedford (County of), Virginia, Industrial Development Revenue, (Nekoosa
Packaging Corporation Project), (Industrial Bank of Japan Ltd. LOC),
1,300,000 3.750% due 10/01/04++................................................. 1,300,000
Virginia College, Virginia, Building Authority, Educational Facilities
Revenue, (University of Richmond Project), (Crestar Bank LOC),
5,500,000 3.600% due 11/01/26++................................................. 5,500,000
Winchester, Virginia, Industrial Development Authority Revenue, Midwesco
Filter, (Harris Trust & Savings Bank LOC),
1,575,000 3.850% due 08/01/07++................................................. 1,575,000
- -----------------------------------------------------------------------------------------------------
13,375,000
- -----------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
21
<PAGE> 24
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Principal Value
Amount NATIONS MUNICIPAL RESERVES (Note 1)
- -----------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (continued)
WASHINGTON -- 1.4%
Port Skagit (County of), Washington, Industrial Development Authority
Revenue, (Cascade Clear Water Company Project), AMT, (Key Bank of
Washington LOC),
$1,000,000 3.800% due 12/01/20++................................................. $ 1,000,000
Washington (State of), Motor Vehicle Fuel Tax, Series B,
2,030,000 6.500% due 07/01/97................................................... 2,063,967
- -----------------------------------------------------------------------------------------------------
3,063,967
- -----------------------------------------------------------------------------------------------------
WEST VIRGINIA -- 2.1%
Marshall (County of), West Virginia, PCR, (BP Oil Inc. Project),
3,800,000 3.650% due 12/01/20+.................................................. 3,800,000
Ohio (County of), West Virginia, Industrial Development Revenue, (Ohio
Valley Clarksburg Drug Company Project), (PNC Bank LOC),
900,000 4.000% due 12/01/01+++................................................ 900,000
- -----------------------------------------------------------------------------------------------------
4,700,000
- -----------------------------------------------------------------------------------------------------
WISCONSIN -- 4.6%
Howard Suamico, Wisconsin, School District, TRAN,
1,750,000 4.400% due 08/22/97................................................... 1,755,418
Kenosha, Wisconsin, TRAN,
2,500,000 4.250% due 06/30/97................................................... 2,503,970
Oshkosh, Wisconsin, Area School District, TRAN,
2,000,000 4.250% due 08/20/97................................................... 2,004,608
Pleasant Prairie, Wisconsin, Industrial Development Revenue, (Nucon
Corporation Project), AMT, (First National Bank (Chicago) LOC),
955,000 3.700% due 02/01/22++................................................. 955,000
Sheboygan Falls, Wisconsin, School District, TRAN,
1,000,000 4.250% due 10/01/97................................................... 1,001,312
Sun Prairie, Wisconsin, Area School District, TRAN,
2,100,000 4.250% due 08/22/97................................................... 2,104,052
- -----------------------------------------------------------------------------------------------------
10,324,360
- -----------------------------------------------------------------------------------------------------
Total Municipal Bonds and Notes (Cost $220,902,117)..................... 220,902,117
- -----------------------------------------------------------------------------------------------------
Shares
- -----------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 0.4%
850,000 AIM Tax-Exempt Fund..................................................... 850,000
25,000 Fidelity Institutional Tax-Exempt Cash Management Fund.................. 25,000
- -----------------------------------------------------------------------------------------------------
Total Money Market Funds (Cost $875,000)............................ 875,000
- -----------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (Cost $221,777,117*).......................... 97.9% 221,777,117
- -----------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
22
<PAGE> 25
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
Value
NATIONS MUNICIPAL RESERVES (Note 1)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
OTHER ASSETS AND LIABILITIES (NET).............................. 2.1%
Other assets........................................................... $ 5,500,282
Dividends payable...................................................... (421,606)
Due to custodian....................................................... (111,809)
Shareholder servicing and distribution fees payable (Note 3)........... (39,740)
Investment advisory fee payable (Note 2)............................... (14,989)
Accrued Trustees' fees and expenses (Note 2)........................... (6,760)
Custodian fees payable (Note 2)........................................ (6,062)
Administration fee payable (Note 2).................................... (2,541)
Accrued expenses and other payables.................................... (46,734)
- ------------------------------------------------------------------------------------------------------
TOTAL OTHER ASSETS AND LIABILITIES (NET)............................... 4,850,041
- ------------------------------------------------------------------------------------------------------
NET ASSETS...................................................... 100.0% $226,627,158
======================================================================================================
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Capital Class Shares:
($55,879,506 / 55,879,781 shares outstanding).......................... $ 1.00
======================================================================================================
Liquidity Class Shares:
($59,387,675 / 59,387,976 shares outstanding).......................... $ 1.00
======================================================================================================
Adviser Class Shares:
($9,360,486 / 9,360,533 shares outstanding)............................ $ 1.00
======================================================================================================
Market Class Shares:
($101,999,491 / 102,000,020 shares outstanding)........................ $ 1.00
======================================================================================================
<FN>
* Aggregate cost for Federal tax purposes.
+ Variable rate demand notes are payable upon not more than one business day's notice. The interest
rate shown reflects the rate currently in effect.
++ Variable rate demand notes are payable upon not more than seven calendar days' notice. The
interest rate shown reflects the rate currently in effect.
+++ Variable rate demand notes are payable upon not more than thirty calendar days' notice. The
interest rate shown reflects the rate currently in effect.
</TABLE>
Nations Municipal Reserves had the following industry concentrations greater
than 10% at October 31, 1996 (as a percentage of net assets):
<TABLE>
<S> <C>
Education Revenue 13.1%
Pollution Control Revenue 12.8%
Hospital Revenue 12.3%
Housing Revenue 10.0%
</TABLE>
See Notes to Financial Statements.
23
<PAGE> 26
STATEMENT OF NET ASSETS (continued) NATIONS INSTITUTIONAL RESERVES
October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
NATIONS MUNICIPAL RESERVES
- -----------------------------------------------------------------------------------------------------
<S> <C> <C>
Abbreviations:
AMBAC -- American Municipal Bond Assurance Corporation
AMT -- Alternative Minimum Tax
CFC -- Cooperative Finance Corporation
FNMA -- Federal National Mortgage Association
FSA -- Financial Security Assurance
GO -- General Obligation Bonds
LOC -- Letter of Credit
MBIA -- Municipal Bond Investors Assurance
PCR -- Pollution Control Revenue
SBPA -- Standby Bond Purchase Agreement
TAN -- Tax Anticipation Notes
TRAN -- Tax and Revenue Anticipation Notes
- -----------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1996 NET ASSETS CONSIST OF:
Accumulated net realized loss on investment sold........................ $ (1,152)
Paid-in capital......................................................... 226,628,310
- -----------------------------------------------------------------------------------------------------
NET ASSETS.............................................................. $226,627,158
=====================================================================================================
</TABLE>
See Notes to Financial Statements.
24
<PAGE> 27
STATEMENTS OF OPERATIONS NATIONS INSTITUTIONAL RESERVES
For the Six Months Ended October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
NATIONS NATIONS NATIONS NATIONS
CASH TREASURY GOVERNMENT MUNICIPAL
RESERVES RESERVES RESERVES RESERVES
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investment Income:
Interest...................................... $33,178,116 $11,669,650 $6,083,968 $3,075,963
Dividends..................................... 1,628,601 391,875 38,355 89,134
- -------------------------------------------------------------------------------------------------------
Total Investment Income..................... 34,806,717 12,061,525 6,122,323 3,165,097
- -------------------------------------------------------------------------------------------------------
Expenses:
Investment advisory fee (Note 2).............. 1,904,975 677,573 341,441 265,243
Administration fee (Note 2)................... 634,992 225,858 113,814 88,414
Transfer agent fees (Note 2).................. 26,815 24,725 27,240 23,613
Custodian fees (Note 2)....................... 93,770 67,041 22,180 16,355
Trustees' fees and expenses (Note 2).......... 36,690 12,045 6,678 5,480
Registration and filing fees.................. 257,182 33,804 54,256 55,581
Legal and audit fees.......................... 49,245 12,998 16,317 13,820
Other......................................... 37,063 55,990 12,051 5,949
- -------------------------------------------------------------------------------------------------------
Subtotal.................................... 3,040,732 1,110,034 593,977 474,455
Shareholder servicing and distribution fees
(Note 3):
Liquidity Class Shares...................... 61,777 3,515 168 13,976
Adviser Class Shares........................ 423,922 147,945 11,327 12,962
Market Class Shares......................... 198,909 126,336 305,842 148,386
Fees waived by investment adviser and
administrator............................... (1,773,287) (659,834) (369,750 ) (299,289)
- -------------------------------------------------------------------------------------------------------
Total Expenses.............................. 1,952,053 727,996 541,564 350,490
- -------------------------------------------------------------------------------------------------------
Net Investment Income..................... 32,854,664 11,333,529 5,580,759 2,814,607
- -------------------------------------------------------------------------------------------------------
Net Realized Gain on Investments
(Note 1).................................. -- 6,650 -- --
- -------------------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting From
Operations................................ $32,854,664 $11,340,179 $5,580,759 $2,814,607
=======================================================================================================
</TABLE>
See Notes to Financial Statements.
25
<PAGE> 28
STATEMENT OF CASH FLOWS NATIONS INSTITUTIONAL RESERVES
For the Six Months Ended October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
NATIONS TREASURY RESERVES
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
Cash flows from operating and investing activities:
Investment income received............................................ $ 11,750,998
Payment of operating expenses......................................... (641,444)
Net proceeds of short-term investments................................ 18,278,285
- ------------------------------------------------------------------------------------------------------
Cash provided by operating and investing activities..................... $ 29,387,839
Cash flows from financing activities:
Proceeds from shares sold............................................. 777,997,921
Payments on shares redeemed........................................... (780,737,682)
Cash used from reverse repurchase agreements.......................... (15,577,000)
Distributions paid*................................................... (11,071,472)
- ------------------------------------------------------------------------------------------------------
Cash used by financing activities....................................... (29,388,233)
- ------------------------------------------------------------------------------------------------------
Decrease in cash........................................................ (394)
Cash at beginning of period............................................. 534
- ------------------------------------------------------------------------------------------------------
Cash at end of period................................................... $ 140
======================================================================================================
RECONCILIATION OF NET INCREASE IN NET ASSETS FROM
OPERATIONS TO CASH PROVIDED BY OPERATING AND
INVESTING ACTIVITIES:
Net increase in net assets resulting from operations.................... $ 11,340,179
Decrease in investments............................................... $ 17,101,973
Decrease in interest and dividends receivable......................... 859,135
Decrease in other assets.............................................. 90,545
Decrease in accrued expenses.......................................... (3,993)
- ------------------------------------------------------------------------------------------------------
Cash provided by operating and investing activities..................... $ 29,387,839
======================================================================================================
</TABLE>
* Non-cash activities include reinvestment of dividends of $388,931.
See Notes to Financial Statements.
26
<PAGE> 29
STATEMENTS OF CHANGES IN NET ASSETS NATIONS INSTITUTIONAL RESERVES
For the Six Months Ended October 31, 1996 (unaudited)
<TABLE>
<CAPTION>
NATIONS NATIONS NATIONS NATIONS
CASH TREASURY GOVERNMENT MUNICIPAL
RESERVES RESERVES RESERVES RESERVES
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net investment income..................... $ 32,854,664 $ 11,333,529 $ 5,580,759 $ 2,814,607
Net realized gain on investments.......... -- 6,650 -- --
- -------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from
operations.............................. 32,854,664 11,340,179 5,580,759 2,814,607
Distributions to shareholders from net
investment income:
Capital Class Shares.................. (19,437,313) (6,610,324) (1,176,500) (1,079,277)
Liquidity Class Shares................ (2,114,986) (117,002) (5,729) (304,520)
Adviser Class Shares.................. (8,528,928) (2,894,793) (222,958) (160,923)
Market Class Shares................... (2,773,437) (1,711,410) (4,175,572) (1,269,887)
Net increase/(decrease) in net assets from
shares of beneficial interest
transactions (Note 4):
Capital Class Shares.................. 433,513,378 (43,242,637) (13,918,053) 7,397,092
Liquidity Class Shares................ 94,545,758 (4,387,336) 571,305 52,654,404
Adviser Class Shares.................. (32,502,410) (32,520,867) (86,112,833) (46,151,513)
Market Class Shares................... 150,500,020 77,800,010 193,800,020 102,000,020
- -------------------------------------------------------------------------------------------------------
Net increase/(decrease) in net assets..... 646,056,746 (2,344,180) 94,340,439 115,900,003
Net Assets:
Beginning of period....................... 1,040,898,764 491,837,222 166,418,275 110,727,155
- -------------------------------------------------------------------------------------------------------
End of period............................. $1,686,955,510 $489,493,042 $260,758,714 $226,627,158
=======================================================================================================
</TABLE>
See Notes to Financial Statements.
27
<PAGE> 30
STATEMENTS OF CHANGES IN NET ASSETS NATIONS INSTITUTIONAL RESERVES
For the Year Ended April 30, 1996
<TABLE>
<CAPTION>
NATIONS NATIONS NATIONS NATIONS
CASH TREASURY GOVERNMENT MUNICIPAL
RESERVES RESERVES RESERVES RESERVES
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net investment income..................... $ 28,719,705 $ 26,673,804 $ 6,892,333 $ 3,808,332
Net realized loss on investments.......... (467) (21,910) (1,654) --
- -------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from
operations.............................. 28,719,238 26,651,894 6,890,679 3,808,332
Distributions to shareholders from net
investment income:
Capital Class Shares.................. (20,455,385) (19,934,505) (1,507,329) (1,408,074)
Liquidity Class Shares................ (1,102,564) (145,195) (989) (144,956)
Adviser Class Shares.................. (7,161,756) (6,594,104) (5,384,015) (2,255,302)
Net increase/(decrease) in net assets from
shares of beneficial interest
transactions (Note 4):
Capital Class Shares.................. 473,578,788 52,659,758 58,120,309 16,129,224
Liquidity Class Shares................ 35,445,236 11,130,769 127,332 4,142,504
Adviser Class Shares.................. 350,127,136 119,938,978 8,921,865 (8,611,389)
- -------------------------------------------------------------------------------------------------------
Net increase in net assets................ 859,150,693 183,707,595 67,167,852 11,660,339
Net Assets:
Beginning of year......................... 181,748,071 308,129,627 99,250,423 99,066,816
- -------------------------------------------------------------------------------------------------------
End of year............................... $1,040,898,764 $491,837,222 $166,418,275 $110,727,155
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
28
<PAGE> 31
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Capital Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS CASH RESERVES
- ---------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR PERIOD
10/31/96 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95 04/30/94 04/30/93 04/30/92 04/30/91*
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Capital Class Shares:
Net asset value, beginning of
year.............................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------------------------
Net investment income............... 0.0266 0.0570 0.0480 0.0283 0.0315 0.0492 0.0392
Dividends from net investment
income............................ (0.0266 ) (0.0570) (0.0480) (0.0283) (0.0315) (0.0492) (0.0392)
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
===========================================================================================================================
Total Return++...................... 2.69% 5.84% 4.91% 2.87% 3.19% 5.03% 7.35%+
===========================================================================================================================
Ratios to average net assets/
supplemental data:
Net assets, end of year (000's)... $1,041,156 $607,643 $134,064 $109,852 $ 55,739 $100,943 $ 19,387
Ratio of operating expenses to
average net assets.............. 0.20%+ 0.20% 0.29% 0.45% 0.45% 0.45% 0.45%+
Ratio of net investment income to
average net assets.............. 5.28%+ 5.53% 4.96% 2.83% 3.15% 4.61% 7.04%+
Ratio of operating expenses to
average net assets without
waivers......................... 0.48%+ 0.51% 0.52% 0.56% 0.59% 0.74% 0.79%+
Ratio of net investment income to
average net assets without
waivers......................... 5.00%+ 5.22% 4.73% 2.72% 3.01% 4.32% 6.70%+
Net investment income per share
without waivers................. $ 0.0252 $ 0.0538 $ 0.0458 $ 0.0272 $ 0.0298 $ 0.0455 $ 0.0373
===========================================================================================================================
<FN>
* The Nations Cash Reserves Capital Class Shares commenced operations on October 10, 1990.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
</TABLE>
See Notes to Financial Statements.
29
<PAGE> 32
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Liquidity Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS CASH RESERVES
- ---------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR PERIOD
10/31/96 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95 04/30/94 04/30/93 04/30/92 04/30/91*
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Liquidity Class Shares:
Net asset value, beginning of
year.............................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------------------------
Net investment income............... 0.0259 0.0555 0.0471 0.0273 0.0305 0.0482 0.0197
Dividends from net investment
income............................ (0.0259) (0.0555) (0.0471) (0.0273) (0.0305) (0.0482) (0.0197)
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
===========================================================================================================================
Total Return++...................... 2.62% 5.70% 4.81% 2.77% 3.09% 4.92% 6.44%+
==========================================================================================================================
Ratios to average net assets/
supplemental data:
Net assets, end of year (000's)... $129,993 $ 35,447 $ 2 $ 69,786 $ 19,411 $ 4,776 $ 10,361
Ratio of operating expenses to
average net assets.............. 0.35%+ 0.35% 0.38% 0.55% 0.55% 0.55% 0.55%+
Ratio of net investment income to
average net assets.............. 5.13%+ 5.38% 4.87% 2.74% 2.96% 4.94% 6.41%+
Ratio of operating expenses to
average net assets without
waivers......................... 0.63%+ 0.66% 0.61% 0.65% 0.68% 0.85% 0.87%+
Ratio of net investment income to
average net assets without
waivers......................... 4.85%+ 5.07% 4.64% 2.64% 2.82% 4.64% 6.09%+
Net investment income per share
without waivers................. $ 0.0245 $ 0.0523 $ 0.0448 $ 0.0262 $ 0.0287 $ 0.0447 $ 0.0186
===========================================================================================================================
<FN>
* The Nations Cash Reserves Liquidity Class Shares commenced operations on January 9, 1991.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
</TABLE>
See Notes to Financial Statements.
30
<PAGE> 33
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For an Adviser Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS CASH RESERVES
- --------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR PERIOD
10/31/96 ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95*
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Adviser Class Shares:
Net asset value, beginning of year..................................... $ 1.00 $ 1.00 $ 1.00
- --------------------------------------------------------------------------------------------------------------------
Net investment income.................................................. 0.0254 0.0545 0.0316
Dividends from net investment income................................... (0.0254) (0.0545) (0.0316)
- --------------------------------------------------------------------------------------------------------------------
Net asset value, end of year........................................... $ 1.00 $ 1.00 $ 1.00
====================================================================================================================
Total Return++......................................................... 2.57% 5.58% 3.20%
====================================================================================================================
Ratios to average net assets/supplemental data:
Net assets, end of year (000's)...................................... $365,307 $397,809 $ 47,682
Ratio of operating expenses to average net assets.................... 0.45%+ 0.45% 0.54%+
Ratio of net investment income to average net assets................. 5.03%+ 5.28% 4.71%+
Ratio of operating expenses to average net assets without waivers.... 0.73%+ 0.76% 0.77%+
Ratio of net investment income to average net assets without
waivers............................................................ 4.75%+ 4.97% 4.48%+
Net investment income per share without waivers...................... $ 0.0240 $ 0.0513 $ 0.0300
====================================================================================================================
<FN>
* The Nations Cash Reserves Adviser Class Shares commenced operations on September 22, 1994.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
</TABLE>
See Notes to Financial Statements.
31
<PAGE> 34
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Market Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS CASH RESERVES
- -----------------------------------------------------------------------------------------------------------------
PERIOD
ENDED
10/31/96*
(UNAUDITED)
- -----------------------------------------------------------------------------------------------------------------
<S> <C>
Market Class Shares:
Net asset value, beginning of year................................................... $ 1.00
- -----------------------------------------------------------------------------------------------------------------
Net investment income................................................................ 0.0246
Dividends from net investment income................................................. (0.0246)
- -----------------------------------------------------------------------------------------------------------------
Net asset value, end of year......................................................... $ 1.00
=================================================================================================================
Total Return++....................................................................... 2.49%
=================================================================================================================
Ratios to average net assets/supplemental data:
Net assets, end of year (000's).................................................... $150,500
Ratio of operating expenses to average net assets.................................. 0.55%+
Ratio of net investment income to average net assets............................... 4.93%+
Ratio of operating expenses to average net assets without waivers.................. 0.83%+
Ratio of net investment income to average net assets without waivers............... 4.65%+
Net investment income per share without waivers.................................... $ 0.0232
=================================================================================================================
<FN>
* The Nations Cash Reserves Market Class Shares commenced operations on May 3, 1996.
+ Annualized.
++ Total return represents aggregate total return for the period indicated.
</TABLE>
See Notes to Financial Statements.
32
<PAGE> 35
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Capital Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS TREASURY RESERVES
---------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR PERIOD
10/31/96 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95 04/30/94 04/30/93 04/30/92 04/30/91*
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Capital Class Shares:
Net asset value, beginning of
year.............................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income............... 0.0259 0.0556 0.0480 0.0298 0.0323 0.0481 0.0176
Net realized gain on investments.... -- -- -- -- 0.0001 0.0003 --
- ---------------------------------------------------------------------------------------------------------------------------
Total from investment operations.... 0.0259 0.0556 0.0480 0.0298 0.0324 0.0484 0.0176
- ---------------------------------------------------------------------------------------------------------------------------
Less distributions:
Dividends from net investment
income.......................... (0.0259) (0.0556) (0.0480) (0.0298) (0.0323) (0.0481) (0.0176)
Distributions from net realized
gains........................... -- -- -- -- (0.0001) (0.0003) --
- ---------------------------------------------------------------------------------------------------------------------------
Total distributions............... (0.0259) (0.0556) (0.0480) (0.0298) (0.0324) (0.0484) (0.0176)
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
Total Return++...................... 2.62% 5.71% 4.91% 3.02% 3.29% 4.92% 5.89%+
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets/
supplemental data:
Net assets, end of year (000's)... $ 261,106 $304,342 $251,694 $338,504 $418,644 $ 19,587 $ 4,519
Ratio of operating expenses to
average net assets.............. 0.20%+ 0.20% 0.20% 0.20% 0.20% 0.26% 0.45%+
Ratio of net investment income to
average net assets.............. 5.14%+ 5.50% 4.79% 2.99% 2.99% 4.39% 5.85%+
Ratio of operating expenses to
average net assets without
waivers......................... 0.49%+ 0.51% 0.50% 0.52% 0.72% 1.06% 0.94%+
Ratio of net investment income to
average net assets without
waivers......................... 4.85%+ 5.19% 4.50% 2.67% 2.48% 3.59% 5.36%+
Net investment income per share
without waivers................. $ 0.0244 $ 0.0525 $ 0.0451 $ 0.0267 $ 0.0251 $ 0.0368 $ 0.0161
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
* The Nations Treasury Reserves Capital Class Shares commenced operations on January 11, 1991.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
</TABLE>
See Notes to Financial Statements.
33
<PAGE> 36
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Liquidity Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS TREASURY RESERVES
- ---------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR PERIOD
10/31/96 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95 04/30/94 04/30/93 04/30/92 04/30/91*
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Liquidity Class Shares:
Net asset value, beginning of year....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income.................... 0.0252 0.0541 0.0462 0.0263 0.0288 0.0454 0.0173
Net realized gain on investments......... -- -- -- -- 0.0001 0.0003 --
- ---------------------------------------------------------------------------------------------------------------------------
Total from investment operations......... 0.0252 0.0541 0.0462 0.0263 0.0289 0.0457 0.0173
- ---------------------------------------------------------------------------------------------------------------------------
Less distributions:
Dividends from net investment
income............................... (0.0252) (0.0541) (0.0462) (0.0263) (0.0288) (0.0454) (0.0173 )
Distributions from net realized
gains................................ -- -- -- -- (0.0001) (0.0003) --
- ---------------------------------------------------------------------------------------------------------------------------
Total distributions.................. (0.0252) (0.0541) (0.0462) (0.0263) (0.0289) (0.0457) (0.0173 )
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
===========================================================================================================================
Total Return++........................... 2.54% 5.57% 4.71% 2.67% 2.93% 4.64% 5.79%+
===========================================================================================================================
Ratios to average net assets/
supplemental data:
Net assets, end of year (000's)........ $ 7,417 $ 11,804 $ 674 $ 14,227 $ 3,369 $ 2,807 $ 2,891
Ratio of operating expenses to average
net assets........................... 0.35%+ 0.35% 0.49% 0.55% 0.55% 0.52% 0.55%+
Ratio of net investment income to
average net assets................... 4.99%+ 5.35% 4.50% 2.67% 2.89% 4.62% 5.75%+
Ratio of operating expenses to average
net assets without waivers........... 0.64%+ 0.66% 0.79% 0.87% 1.07% 1.32% 1.04%+
Ratio of net investment income to
average net assets without waivers... 4.70%+ 5.04% 4.21% 2.35% 2.37% 3.82% 5.26%+
Net investment income per share without
waivers.............................. $ 0.0237 $ 0.0510 $ 0.0431 $ 0.0232 $ 0.0213 $ 0.0349 $ 0.0160
===========================================================================================================================
</TABLE>
* The Nations Treasury Reserves Liquidity Class Shares commenced operations on
January 11, 1991.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
See Notes to Financial Statements.
34
<PAGE> 37
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For an Adviser Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS TREASURY RESERVES
- --------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR PERIOD
10/31/96 ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95*
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Adviser Class Shares:
Net asset value, beginning of year........................................ $ 1.00 $ 1.00 $ 1.00
- --------------------------------------------------------------------------------------------------------------------
Net investment income..................................................... 0.0247 0.0531 0.0308
Dividends from net investment income...................................... (0.0247) (0.0531) (0.0308)
- --------------------------------------------------------------------------------------------------------------------
Net asset value, end of year.............................................. $ 1.00 $ 1.00 $ 1.00
- --------------------------------------------------------------------------------------------------------------------
Total Return++............................................................ 2.50% 5.45% 3.11%
====================================================================================================================
Ratios to average net assets/supplemental data:
Net assets, end of year (000's)......................................... $143,174 $175,691 $ 55,762
Ratio of operating expenses to average net assets....................... 0.45%+ 0.45% 0.45%+
Ratio of net investment income to average net assets.................... 4.89%+ 5.25% 4.54%+
Ratio of operating expenses to average net assets without waivers....... 0.74%+ 0.76% 0.75%+
Ratio of net investment income to average net assets without waivers.... 4.60%+ 4.94% 4.25%+
Net investment income per share without waivers......................... $ 0.0232 $ 0.0500 $ 0.0288
====================================================================================================================
</TABLE>
* The Nations Treasury Reserves Adviser Class Shares commenced operations on
September 22, 1994.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
See Notes to Financial Statements.
35
<PAGE> 38
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Market Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS TREASURY RESERVES
- ------------------------------------------------------------------------------------------------------------------
PERIOD
ENDED
10/31/96*
(UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------
<S> <C>
Market Class Shares:
Net asset value, beginning of year............................................................. $ 1.00
- ------------------------------------------------------------------------------------------------------------------
Net investment income.......................................................................... 0.0239
Dividends from net investment income........................................................... (0.0239)
- ------------------------------------------------------------------------------------------------------------------
Net asset value, end of year................................................................... $ 1.00
==================================================================================================================
Total Return++................................................................................. 2.41%
==================================================================================================================
Ratios to average net assets/supplemental data:
Net assets, end of year (000's).............................................................. $ 77,795
Ratio of operating expenses to average net assets............................................ 0.55%+
Ratio of net investment income to average net assets......................................... 4.79%+
Ratio of operating expenses to average net assets without waivers............................ 0.84%+
Ratio of net investment income to average net assets without waivers......................... 4.50%+
Net investment income per share without waivers.............................................. $ 0.0224
==================================================================================================================
</TABLE>
* The Nations Treasury Reserves Market Class Shares commenced operations on
May 3, 1996.
+ Annualized.
++ Total return represents aggregate total return for the period indicated.
See Notes to Financial Statements.
36
<PAGE> 39
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Capital Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS GOVERNMENT RESERVES
- ---------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR PERIOD
10/31/96 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95 04/30/94 04/30/93 04/30/92 04/30/91*
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Capital Class Shares:
Net asset value, beginning of year........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income................... 0.0261 0.0556 0.0463 0.0278 0.0312 0.0343 0.0168
Net realized gain on investments........ -- -- -- -- -- 0.0023 --
- ---------------------------------------------------------------------------------------------------------------------------
Total from investment operations.... 0.0261 0.0556 0.0463 0.0278 0.0312 0.0366 0.0168
- ---------------------------------------------------------------------------------------------------------------------------
Less distributions:
Dividends from net investment
income................................ (0.0261) (0.0556) (0.0463) (0.0278) (0.0312) (0.0343) (0.0168)
Distributions from net realized
gains................................. -- -- -- -- -- (0.0023) --
- ---------------------------------------------------------------------------------------------------------------------------
Total distributions................... (0.0261) (0.0556) (0.0463) (0.0278) (0.0312) (0.0366) (0.0168)
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year.............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
===========================================================================================================================
Total Return++............................ 2.63% 5.71% 4.72% 2.82% 3.15% 3.71% 5.57%+
===========================================================================================================================
Ratios to average net assets/
supplemental data:
Net assets, end of year (000's)......... $ 44,204 $ 58,121 $ 2 $ 10,819 $ 7,396 $ 1,800 $ 295
Ratio of operating expenses to average
net assets............................ 0.20%+ 0.20% 0.32% 0.45% 0.45% 0.45% 0.45%+
Ratio of net investment income to
average net assets.................... 5.20%+ 5.48% 4.35% 2.78% 3.07% 4.24% 5.89%+
Ratio of operating expenses to average
net assets without waivers............ 0.52%+ 0.53% 0.54% 0.51% 0.64% 0.76% 0.80%+
Ratio of net investment income to
average net assets without waivers.... 4.87%+ 5.15% 4.13% 2.72% 2.88% 3.93% 5.54%+
Net investment income per share without
waivers............................... $ 0.0245 $ 0.0523 $ 0.0439 $ 0.0272 $ 0.0288 $ 0.0313 $ 0.0158
===========================================================================================================================
<FN>
* The Nations Government Reserves Capital Class Shares commenced operations on January 17, 1991.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
</TABLE>
See Notes to Financial Statements.
37
<PAGE> 40
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Liquidity Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS GOVERNMENT RESERVES
---------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR PERIOD
10/31/96 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95 04/30/94 04/30/93 04/30/92 04/30/91*
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Liquidity Class Shares:
Net asset value, beginning of year....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income.................. 0.0253 0.0537 0.0453 0.0268 0.0302 0.0461 0.0176
Net realized gain on investments....... -- -- -- -- -- 0.0023 --
- ---------------------------------------------------------------------------------------------------------------------------
Total from investment operations..... 0.0253 0.0537 0.0453 0.0268 0.0302 0.0484 0.0176
- ---------------------------------------------------------------------------------------------------------------------------
Less distributions:
Dividends from net investment
income............................... (0.0253) (0.0537) (0.0453) (0.0268) (0.0302) (0.0461) (0.0176)
Distributions from net realized
gains................................ -- -- -- -- -- (0.0023) --
- ---------------------------------------------------------------------------------------------------------------------------
Total distributions.................. (0.0253) (0.0537) (0.0453) (0.0268) (0.0302) (0.0484) (0.0176)
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
===========================================================================================================================
Total Return++........................... 2.57% 5.51% 4.59% 2.71% 3.05% 4.70% 6.04%+
===========================================================================================================================
Ratios to average net assets/
supplemental data:
Net assets, end of year (000's)........ $ 701 $ 129 $ 2 $259,836 $149,252 $ 12,486 $ 5,589
Ratio of operating expenses to average
net assets........................... 0.35%+ 0.35% 0.40% 0.55% 0.55% 0.55% 0.55%+
Ratio of net investment income to
average net assets................... 5.05%+ 5.33% 4.27% 2.68% 2.71% 4.46% 5.86%+
Ratio of operating expenses to average
net assets without waivers........... 0.67%+ 0.68% 0.62% 0.61% 0.74% 0.86% 0.94%+
Ratio of net investment income to
average net assets without waivers... 4.72%+ 5.00% 4.05% 2.62% 2.52% 4.18% 5.47%+
Net investment income per share without
waivers.............................. $ 0.0237 $ 0.0504 $ 0.0430 $ 0.0262 $ 0.0274 $ 0.0422 $ 0.0170
===========================================================================================================================
<FN>
* The Nations Government Reserves Liquidity Class Shares commenced operations on January 11, 1991.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
</TABLE>
See Notes to Financial Statements.
38
<PAGE> 41
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For an Adviser Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS GOVERNMENT RESERVES
- -------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR PERIOD
10/31/96 ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95*
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Adviser Class Shares:
Net asset value, beginning of year............................................ $ 1.00 $ 1.00 $ 1.00
- -------------------------------------------------------------------------------------------------------------------------
Net investment income......................................................... 0.0248 0.0527 0.0299
Dividends from net investment income.......................................... (0.0248) (0.0527) (0.0299)
- -------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year.................................................. $ 1.00 $ 1.00 $ 1.00
=========================================================================================================================
Total Return++................................................................ 2.51% 5.39% 3.04%
=========================================================================================================================
Ratios to average net assets/supplemental data:
Net assets, end of year (000's)............................................. $ 22,056 $108,168 $ 99,246
Ratio of operating expenses to average net assets........................... 0.45%+ 0.45% 0.57%+
Ratio of net investment income to average net assets........................ 4.95%+ 5.23% 4.10%+
Ratio of operating expenses to average net assets without waivers........... 0.77%+ 0.78% 0.79%+
Ratio of net investment income to average net assets without waivers........ 4.62%+ 4.90% 3.88%+
Net investment income per share without waivers............................. $ 0.0232 $ 0.0494 $ 0.0283
=========================================================================================================================
<FN>
* The Nations Government Reserves Adviser Class Shares commenced operations on September 22, 1994.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
</TABLE>
See Notes to Financial Statements.
39
<PAGE> 42
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Market Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS GOVERNMENT RESERVES
- -----------------------------------------------------------------------------------------------------------------------
PERIOD
ENDED
10/31/96*
(UNAUDITED)
- -----------------------------------------------------------------------------------------------------------------------
<S> <C>
Market Class Shares:
Net asset value, beginning of year.................................................................... $ 1.00
- -----------------------------------------------------------------------------------------------------------------------
Net investment income................................................................................. 0.0241
Dividends from net investment income.................................................................. (0.0241)
- -----------------------------------------------------------------------------------------------------------------------
Net asset value, end of year.......................................................................... $ 1.00
=======================================================================================================================
Total Return++........................................................................................ 2.42%
=======================================================================================================================
Ratios to average net assets/supplemental data:
Net assets, end of year (000's)..................................................................... $193,798
Ratio of operating expenses to average net assets................................................... 0.55%+
Ratio of net investment income to average net assets................................................ 4.85%+
Ratio of operating expenses to average net assets without waivers................................... 0.87%+
Ratio of net investment income to average net assets without waivers................................ 4.52%+
Net investment income per share without waivers..................................................... $ 0.0225
=======================================================================================================================
<FN>
* The Nations Government Reserves Market Class Shares commenced operations on May 3, 1996.
+ Annualized.
++ Total return represents aggregate total return for the period indicated.
</TABLE>
See Notes to Financial Statements.
40
<PAGE> 43
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Capital Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS MUNICIPAL RESERVES
- ---------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR PERIOD
10/31/96 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95 04/30/94 04/30/93 04/30/92 04/30/91*
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Capital Class Shares:
Net asset value, beginning of year... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------------------------
Net investment income................ 0.0171 0.0362 0.0313 0.0198 0.0231 0.0356 0.0245
Dividends from net investment
income............................. (0.0171) (0.0362) (0.0313) (0.0198) (0.0231) (0.0356) (0.0245)
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
===========================================================================================================================
Total Return++....................... 1.72% 3.70% 3.19% 2.00% 2.34% 3.62% 4.62%+
===========================================================================================================================
Ratios to average net assets/
supplemental data:
Net assets, end of year (000's).... $ 55,880 $ 48,482 $ 32,353 $ 35,698 $ 26,145 $ 18,150 $ 5,064
Ratio of operating expenses to
average net assets............... 0.20%+ 0.20% 0.23% 0.45% 0.45% 0.45% 0.45%+
Ratio of net investment income to
average net assets............... 3.38%+ 3.61% 3.36% 1.98% 2.27% 3.38% 4.70%+
Ratio of operating expenses to
average net assets without
waivers and/or expenses
reimbursed....................... 0.54%+ 0.58% 0.59% 0.58% 0.66% 0.89% 0.99%+
Ratio of net investment income to
average net assets without
waivers and/or expenses
reimbursed....................... 3.04%+ 3.23% 2.99% 1.85% 2.05% 2.94% 4.16%+
Net investment income per share
without waivers and/or expenses
reimbursed....................... $ 0.0154 $ 0.0324 $ 0.0279 $ 0.0186 $ 0.0203 $ 0.0296 $ 0.0216
===========================================================================================================================
<FN>
* The Nations Municipal Reserves Capital Class Shares commenced operations on October 23, 1990.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
</TABLE>
See Notes to Financial Statements.
41
<PAGE> 44
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Liquidity Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS MUNICIPAL RESERVES
- ---------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR PERIOD
10/31/96 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95 04/30/94 04/30/93 04/30/92 04/30/91*
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Liquidity Class Shares:
Net asset value, beginning of year... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------------------------
Net investment income................ 0.0163 0.0347 0.0304 0.0188 0.0221 0.0346 0.0478
Dividends from net investment
income............................. (0.0163) (0.0347) (0.0304) (0.0188) (0.0221) (0.0346) (0.0478)
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
===========================================================================================================================
Total Return++....................... 1.64% 3.52% 3.09% 1.90% 2.24% 3.52% 4.60%+
===========================================================================================================================
Ratios to average net assets/
supplemental data:
Net assets, end of year (000's).... $ 59,388 $ 6,734 $ 2,591 $ 13,805 $ 10,766 $ 11,473 $ 8,927
Ratio of operating expenses to
average net assets............... 0.35%+ 0.35% 0.33% 0.55% 0.55% 0.55% 0.55%+
Ratio of net investment income to
average net assets............... 3.23%+ 3.46% 3.26% 1.86% 2.21% 3.36% 5.22%+
Ratio of operating expenses to
average net assets without
waivers and/or expenses
reimbursed....................... 0.69%+ 0.73% 0.69% 0.67% 0.76% 0.99% 0.81%+
Ratio of net investment income to
average net assets without
waivers and/or expenses
reimbursed....................... 2.89%+ 3.08% 2.89% 1.74% 2.00% 2.92% 4.96%+
Net investment income per share
without waivers and/or expenses
reimbursed....................... $ 0.0146 $ 0.0309 $ 0.0270 $ 0.0176 $ 0.0192 $ 0.0285 $ 0.0455
===========================================================================================================================
<FN>
* The Nations Municipal Reserves Liquidity Class Shares commenced operations on June 1, 1990.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
</TABLE>
See Notes to Financial Statements.
42
<PAGE> 45
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For an Adviser Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS MUNICIPAL RESERVES
- --------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR PERIOD
10/31/96 ENDED ENDED
(UNAUDITED) 04/30/96 04/30/95*
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Adviser Class Shares:
Net asset value, beginning of year............................................... $ 1.00 $ 1.00 $ 1.00
- --------------------------------------------------------------------------------------------------------------------------
Net investment income............................................................ 0.0158 0.0337 0.0199
Dividends from net investment income............................................. (0.0158) (0.0337) (0.0199)
- --------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year..................................................... $ 1.00 $ 1.00 $ 1.00
==========================================================================================================================
Total Return++................................................................... 1.59% 3.43% 2.02%
==========================================================================================================================
Ratios to average net assets/supplemental data:
Net assets, end of year (000's)................................................ $ 9,360 $ 55,511 $ 64,123
Ratio of operating expenses to average net assets.............................. 0.45%+ 0.45% 0.48%+
Ratio of net investment income to average net assets........................... 3.13%+ 3.36% 3.11%+
Ratio of operating expenses to average net assets without waivers and/or
expenses reimbursed.......................................................... 0.79%+ 0.83% 0.84%+
Ratio of net investment income to average net assets without waivers and/or
expenses reimbursed.......................................................... 2.79%+ 2.98% 2.74%+
Net investment income per share without waivers and/or expenses reimbursed..... $ 0.0141 $ 0.0299 $ 0.0176
==========================================================================================================================
<FN>
* The Nations Municipal Reserves Adviser Class Shares commenced operations on September 22, 1994.
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
</TABLE>
See Notes to Financial Statements.
43
<PAGE> 46
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Market Class Share outstanding throughout each year.
<TABLE>
<CAPTION>
NATIONS MUNICIPAL RESERVES
- -------------------------------------------------------------------------------------------------------------------------
PERIOD
ENDED
10/31/96*
(UNAUDITED)
- -------------------------------------------------------------------------------------------------------------------------
<S> <C>
Market Class Shares:
Net asset value, beginning of year...................................................................... $ 1.00
- -------------------------------------------------------------------------------------------------------------------------
Net investment income................................................................................... 0.0151
Dividends from net investment income.................................................................... (0.0151)
- -------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year............................................................................ $ 1.00
=========================================================================================================================
Total Return++.......................................................................................... 1.52%
=========================================================================================================================
Ratios to average net assets/supplemental data:
Net assets, end of year (000's)....................................................................... $101,999
Ratio of operating expenses to average net assets..................................................... 0.55%+
Ratio of net investment income to average net assets.................................................. 3.03%+
Ratio of operating expenses to average net assets without waivers..................................... 0.89%+
Ratio of net investment income to average net assets without waivers.................................. 2.69%+
Net investment income per share without waivers....................................................... $ 0.0134
=========================================================================================================================
<FN>
* The Nations Municipal Reserves Market Class Shares commenced operations on May 3, 1996.
+ Annualized.
++ Total return represents aggregate total return for the period indicated.
</TABLE>
See Notes to Financial Statements.
44
<PAGE> 47
NOTES TO FINANCIAL STATEMENTS (unaudited) NATIONS INSTITUTIONAL RESERVES
1. Significant Accounting Policies.
NATIONS INSTITUTIONAL RESERVES (the "Trust") is registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as an open-end management
investment company. As of the date of this report, the Trust offers four
portfolios: Nations Cash Reserves, Nations Treasury Reserves, Nations Government
Reserves and Nations Municipal Reserves (individually, a "Portfolio",
collectively, the "Portfolios"). The Portfolios currently offer four classes of
shares: Capital Class Shares, Liquidity Class Shares, Adviser Class Shares and
Market Class Shares. Matters affecting each class will be voted on exclusively
by its respective shareholders. 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 may differ from those estimates. The
following is a summary of significant accounting policies followed by the
Portfolios in the preparation of their financial statements.
Securities Valuation -- The securities of each Portfolio are valued on the
basis of amortized cost, which approximates market value. Amortized cost
valuation involves initially valuing an instrument at its cost and
thereafter assuming a constant amortization to maturity of any discount or
premium, as long as the effect of fluctuating interest rates on the fair
market value of the instrument is not significant.
Repurchase Agreements -- Each Portfolio may engage in repurchase agreement
transactions. Under the terms of a typical repurchase agreement, the
Portfolio takes possession of an underlying debt obligation subject to an
obligation of the seller to repurchase, and the Portfolio to resell, the
obligation at an agreed-upon price and time, thereby determining the yield
during the Portfolio's holding period. This arrangement results in a fixed
rate of return that is not subject to market fluctuations during the
Portfolio's holding period. The value of the collateral is at least equal at
all times to the total amount of the repurchase obligations, including
interest. Generally, in the event of counterparty default, the Portfolio has
the right to use the collateral to offset losses incurred. There would be a
potential loss to the Portfolio in the event the Portfolio is delayed or
prevented from exercising its right to dispose of the collateral securities,
including the risk of a possible decline in the value of the underlying
securities during the period while the Portfolio seeks to assert its right.
Unless permitted by the Securities and Exchange Commission, the Portfolio
will not enter into repurchase agreements with its investment adviser,
distributor or any of its affiliates. The Portfolio's investment adviser,
acting under the supervision of the Board of Trustees, monitors the value of
the collateral received as well as the creditworthiness of those banks and
dealers with which the Portfolios enter into repurchase agreements to
evaluate potential risks.
Reverse Repurchase Agreements -- Nations Cash Reserves, Nations Treasury
Reserves and Nations Government Reserves are authorized to enter into
reverse repurchase agreements with institutions that the Portfolio's
investment adviser has determined to be credit worthy. Under a reverse
repurchase agreement, the Portfolio sells securities and agrees to
repurchase them at a mutually agreed upon date and price. At the time the
Portfolio enters into a reverse repurchase agreement, it is required to
establish a segregated account with its custodian bank in which it will
maintain cash, U.S. Government securities or other liquid high grade debt
obligations in an amount at least equal in value to the Portfolio's
obligations arising under the reverse repurchase agreement. Reverse
repurchase agreements involve the risk that the market value of the
securities purchased with the proceeds from the sale of securities received
by the Portfolio may decline below the price of the securities that the
Portfolio is obligated to repurchase. Securities subject to repurchase under
reverse repurchase agreements are designated in the Statement of Net Assets.
At October 31, 1996, the Nations Treasury Reserves had reverse repurchase
agreements outstanding as follows:
<TABLE>
<S> <C>
Maturity Amount................................................. $89,667,000
Maturity Date................................................... 07/01/97
Market Value of Assets Sold Under Agreements.................... $89,135,933
</TABLE>
The average daily balance of reverse repurchase agreements outstanding
during the six months ended October 31, 1996 was $91,130,370. Nations Cash
Reserves and Nations Government Reserves did not enter into any reverse
repurchase agreements during the six months ended October 31, 1996.
45
<PAGE> 48
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued) NATIONS INSTITUTIONAL
RESERVES
The proceeds received by Nations Treasury Reserves under the reverse
repurchase agreements were reinvested in a tri-party repurchase agreement.
Net fees earned during the six months ended October 31, 1996, representing
the difference between interest rates on the reverse repurchase and
repurchase agreements, amounted to $66,955. Such amounts have been included
in interest income in the Statement of Operations.
Securities Transactions and Investment Income -- Securities transactions are
accounted for on a trade date basis. Realized gains and losses are computed
on the specific identification of the securities sold. Interest income,
adjusted for amortization of discounts and premiums on investments to
maturity, is earned from the settlement date and is recorded on the accrual
basis. Dividend income is recorded on the ex-dividend date. Each Portfolio's
investment income and realized gains and losses are allocated among classes
based upon the relative average net assets of each class of shares.
Dividends and Distributions to Shareholders -- It is the policy of each
Portfolio to declare dividends daily from net investment income and to pay
such dividends monthly. Each Portfolio will distribute net realized
short-term capital gains annually after the fiscal year in which earned or
more frequently to maintain a net asset value of $1.00 per share, unless
offset by any available capital loss carryforward. Additional distributions
of net investment income and capital gains may be made at the discretion of
the Board of Trustees in order to avoid application of a 4% non-deductible
Federal excise tax. Income distributions and capital gain distributions on a
Portfolio level are determined in accordance with Federal income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to timing differences and differing
characterization of distributions made by the Portfolio as a whole.
Federal Income Tax -- It is the policy of each Portfolio to qualify as a
regulated investment company by complying with the requirements of the
Internal Revenue Code of 1986, as amended, applicable to regulated
investment companies and by distributing substantially all of its earnings
to its shareholders. Therefore, no Federal income or excise tax provision is
applicable.
Expenses -- General expenses of the Trust are allocated to the relevant
Portfolios based upon relative net assets. Operating expenses directly
attributable to a class of shares are charged to such class' operations.
Expenses of each Portfolio not directly attributable to the operations of
any class of shares are prorated among the classes based on the relative
average net assets of each class of shares.
Cash Flow Information -- Cash, as used in the Statement of Cash Flows, is
the amount of cash on hand at custodian banks. The Trust issues and redeems
shares, invests in securities, and distributes dividends from net investment
income and net capital gains (which are either paid in cash or reinvested at
the discretion of shareholders). These activities are reported in the
Statements of Changes in Net Assets. Information on cash payments is
presented in the Statement of Cash Flows.
2. Investment Advisory Fee, Administrative Fee and Related Party Transactions.
The Trust has, on behalf of its Portfolios, entered into an investment advisory
agreement ("Investment Advisory Agreement") with NationsBanc Advisors, Inc.
("NBAI"), a wholly-owned subsidiary of NationsBank, N.A. ("NationsBank").
Under the terms of the Investment Advisory Agreement, NBAI is entitled to
receive an advisory fee from the Portfolios equal to 0.30% on an annualized
basis, of the average daily net assets of each Portfolio.
The Trust has entered into a sub-advisory agreement ("Sub-Advisory Agreement")
with NBAI and TradeStreet Investment Associates, Inc. ("TradeStreet"), a
wholly-owned subsidiary of NationsBank. Under the terms of the Sub-Advisory
Agreement, TradeStreet is entitled to receive from NBAI a sub-advisory fee for
each Portfolio at the annual rate of 0.033% of such Portfolio's average daily
net assets.
Stephens Inc. ("Stephens") serves as the administrator of the Trust pursuant to
an administration agreement ("Administration Agreement"). First Data Investor
Services Group, Inc. ("First Data"), a wholly-owned subsidiary of First Data
Corporation, serves as the co-administrator of the Trust pursuant to a
co-administration agreement ("Co-Administration Agreement"). Pursuant to the
Administration and Co-Administration Agreements, the administrator and the
co-administrator are entitled to receive a combined fee, computed daily and paid
monthly, at the annual rate of 0.10% of average daily net assets of the
Portfolios on a combined basis.
46
<PAGE> 49
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued) NATIONS INSTITUTIONAL
RESERVES
For the six months ended October 31, 1996, Stephens earned $106,308 (after fee
waivers) from the Portfolios for its administration services.
The investment adviser, sub-adviser, administrator and co-administrator may,
from time to time, reduce their fees payable by each Portfolio (either
voluntarily or pursuant to applicable state limitations). For the six months
ended October 31, 1996, the investment adviser and administrator voluntarily
waived the following fees:
<TABLE>
<CAPTION>
FEES
WAIVED BY FEES
INVESTMENT WAIVED BY
ADVISER ADMINISTRATOR
---------- -------------
<S> <C> <C>
Nations Cash Reserves....................................... $1,231,794 $541,493
Nations Treasury Reserves................................... 467,260 192,574
Nations Government Reserves................................. 272,733 97,017
Nations Municipal Reserves.................................. 223,894 75,395
</TABLE>
No officer, director or employee of NationsBank, NBAI, TradeStreet, Stephens,
First Data or any affiliate thereof, receives any compensation from the Trust
for serving as a trustee, officer or employee of the Trust. The Trust pays each
Trustee an annual fee of $1,000 ($3,000 for the Chairman of the Board), plus
$500 per Portfolio and an additional $1,000 for each in-person board meeting,
and $500 for each telephonic board meeting attended. The Trust also reimburses
expenses incurred by the Trustees in attending such meetings.
The Portfolios' eligible Trustees may participate in a non-qualified deferred
compensation plan and retirement plans, which may be terminated at any time. All
benefits provided under these plans are unfunded and any payments to plan
participants are paid solely out of the Portfolios' assets. Income earned on
each plan participant's deferral account is tied to the rate of return of the
eligible mutual funds selected by the participant or, if no funds are selected,
to the rate of return of Nations Treasury Fund, a fund of Nations Fund, Inc. The
expenses for the deferred compensation plan are included in the "Trustees' fees
and expenses" line of the Statements of Operations.
NationsBank of Texas, N.A. ("NationsBank of Texas") acts as the custodian for
the Portfolios and, for the six months ended October 31, 1996, earned $199,346
for providing such services. On October 18, 1996, the Bank of New York became
the sub-custodian for the Portfolios. First Data also serves as the transfer
agent for the Portfolios' shares. NationsBank of Texas acts as the sub-transfer
agent for the Capital Class Shares of the Portfolios and, for the six months
ended October 31, 1996, earned approximately $11,499 for providing such
services. Stephens also acts as distributor of the Portfolios' shares.
3. Shareholder Servicing and Distribution Plans.
The Trust has adopted a distribution plan pursuant to Rule 12b-1 under the 1940
Act for the Liquidity Class Shares ("Liquidity Class Shares Plan") and the
Market Class Shares ("Market Class Shares Plan") of the Portfolios. Under the
Liquidity Class Shares Plan, the Trust may reimburse Stephens for actual
expenses incurred by Stephens in connection with the distribution of Liquidity
Class Shares up to 0.30% of the average daily net assets of the Liquidity Class
Shares of the Portfolios. Under the Market Class Shares Plan, the Trust may
compensate or reimburse Stephens for any activities or expenses primarily
intended to result in the sale of the Market Class Shares up to 0.20% of the
average daily net assets of the Market Class Shares of the Portfolios.
Currently, the Trust is not reimbursing Stephens for any portion of such
expenses for Liquidity Class Shares and Market Class Shares. Unreimbursed
expenses incurred by Stephens in a given year may not be recovered by Stephens
in subsequent years.
In addition, the Liquidity Class Shares Plan permits the Trust to pay Stephens
an annual fee of up to 0.30% of the average daily net assets of the Liquidity
Class Shares of Nations Cash Reserves, Nations Government Reserves, and Nations
Municipal Reserves and 0.35% of the average daily net assets of the Liquidity
Class Shares of Nations Treasury Reserves. Stephens may use this fee to
compensate certain financial institutions, with which it has entered into
servicing agreements, that provide administrative and/or distribution services
to Liquidity Class Shares shareholders. Currently, the Trust is not accruing
fees pursuant to the Liquidity Class Shares Plan.
47
<PAGE> 50
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued) NATIONS INSTITUTIONAL
RESERVES
The Trust also has adopted shareholder servicing plans ("Servicing Plans") for
the Liquidity Class Shares, Adviser Class Shares and Market Class Shares of the
Portfolios. Under the Servicing Plans, a Portfolio may pay servicing agents that
have entered into a shareholder servicing agreement with the Trust for certain
shareholder support services that are provided by the servicing agents to
holders of Liquidity Class Shares, Adviser Class Shares and Market Class Shares.
Payments under the Servicing Plans are accrued daily and paid monthly at rates
that will not exceed 0.25%, on an annualized basis, of the average daily net
assets of the Liquidity Class Shares, Adviser Class Shares and Market Class
Shares, of the Portfolios. Fees paid pursuant to the Servicing Plans are charged
as expenses of Liquidity Class Shares, Adviser Class Shares and Market Class
Shares, respectively, as accrued.
For the six months ended October 31, 1996, the effective annualized rates paid
by the Portfolios, as a percentage of average daily net assets, pursuant to the
plans are as follows:
<TABLE>
<CAPTION>
LIQUIDITY CLASS ADVISER CLASS MARKET CLASS
LIQUIDITY CLASS SHARES SHARES MARKET CLASS SHARES
SHARES SERVICING SERVICING SHARES SERVICING
PORTFOLIO PLAN PLAN PLAN PLAN PLAN
---------------- --------------- --------------- ------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Nations Cash
Reserves...... 0.00% 0.15% 0.25% 0.10% 0.25%
Nations Treasury
Reserves...... 0.00% 0.15% 0.25% 0.10% 0.25%
Nations
Government
Reserves...... 0.00% 0.15% 0.25% 0.10% 0.25%
Nations
Municipal
Reserves...... 0.00% 0.15% 0.25% 0.10% 0.25%
</TABLE>
A substantial portion of the fees paid pursuant to the plans described above are
paid to affiliates of NationsBank.
4. Shares of Beneficial Interest.
As of October 31, 1996, an unlimited number of shares without par value were
authorized for the Trust. The Trust's Declaration of Trust authorizes the Board
of Trustees to classify or reclassify any authorized, but unissued, shares into
one or more additional classes or series of shares. Since the Portfolios have
sold and redeemed shares only at a constant net asset value of $1.00 per share,
the number of shares represented by such sales and redemptions is the same as
the amounts shown below for such transactions. Changes in capital stock for each
Portfolio were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- --------------
<S> <C> <C>
NATIONS CASH RESERVES:
Capital Class Shares:
Sold............................................ $ 1,934,166,985 $1,186,447,620
Issued as reinvestment of dividends............. 5,291,619 1,201,076
Redeemed........................................ (1,505,945,226) (714,069,908)
--------------- --------------
Net increase.................................... $ 433,513,378 $ 473,578,788
=============== ==============
</TABLE>
48
<PAGE> 51
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued) NATIONS INSTITUTIONAL
RESERVES
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- -------------
<S> <C> <C>
NATIONS CASH RESERVES (CONTINUED):
Liquidity Class Shares:
Sold............................................ $ 1,097,080,482 $ 316,764,360
Issued as reinvestment of dividends............. 1,377,445 842,517
Redeemed........................................ (1,003,912,169) (282,161,641)
--------------- -------------
Net increase.................................... $ 94,545,758 $ 35,445,236
=============== =============
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- --------------
<S> <C> <C>
Adviser Class Shares:
Sold............................................ $ 397,443,550 $ 764,101,646
Issued as reinvestment of dividends............. 471,502 78,897
Redeemed........................................ (430,417,462) (414,053,407)
------------- -------------
Net increase/(decrease)......................... $ (32,502,410) $ 350,127,136
============= =============
</TABLE>
<TABLE>
<CAPTION>
PERIOD ENDED
OCTOBER 31,
1996*
----------------
<S> <C>
Market Class Shares:
Sold............................................ $224,800,020
Redeemed........................................ (74,300,000)
------------
Net increase.................................... $150,500,020
============
</TABLE>
- ---------------
* The Nations Cash Reserves Market Class Shares commenced operations on May 3,
1996.
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- --------------
<S> <C> <C>
NATIONS TREASURY RESERVES:
Capital Class Shares:
Sold............................................ $ 478,046,567 $1,731,309,808
Issued as reinvestment of dividends............. 69,255 --
Redeemed........................................ (521,358,459) (1,678,650,050)
------------- --------------
Net increase/(decrease)........................... $ (43,242,637) $ 52,659,758
============= ==============
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- --------------
<S> <C> <C>
Liquidity Class Shares:
Sold............................................ $ 15,519,444 $ 23,746,115
Issued as reinvestment of dividends............. 77,747 113,655
Redeemed........................................ (19,984,527) (12,729,001)
------------ ------------
Net increase/(decrease)......................... $ (4,387,336) $ 11,130,769
============ ============
</TABLE>
49
<PAGE> 52
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued) NATIONS INSTITUTIONAL
RESERVES
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- --------------
<S> <C> <C>
NATIONS TREASURY RESERVES (CONTINUED):
Adviser Class Shares:
Sold............................................ $ 158,881,910 $ 569,065,291
Issued as reinvestment of dividends............. 241,929 31,406
Redeemed........................................ (191,644,706) (449,157,719)
------------- -------------
Net increase/(decrease)......................... $ (32,520,867) $ 119,938,978
============= =============
</TABLE>
<TABLE>
<CAPTION>
PERIOD ENDED
OCTOBER 31,
1996*
-------------
<S> <C>
Market Class Shares:
Sold............................................ $125,550,010
Redeemed........................................ (47,750,000)
------------
Net increase.................................... $ 77,800,010
============
</TABLE>
- ---------------
* The Nations Treasury Reserves Market Class Shares commenced operations on May
3, 1996.
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- -------------
<S> <C> <C>
NATIONS GOVERNMENT RESERVES:
Capital Class Shares:
Sold............................................ $ 74,866,607 $154,655,322
Issued as reinvestment of dividends............. 67,934 30,543
Redeemed........................................ (88,852,594) (96,565,556)
------------ ------------
Net increase/(decrease)......................... $(13,918,053) $ 58,120,309
============ ============
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- -----------
<S> <C> <C>
Liquidity Class Shares:
Sold............................................ $1,025,576 $ 346,343
Issued as reinvestment of dividends............. 5,729 989
Redeemed........................................ (460,000) (220,000)
---------- ---------
Net increase.................................... $ 571,305 $ 127,332
========== =========
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- --------------
<S> <C> <C>
Adviser Class Shares:
Sold............................................ $ 52,997,634 $ 327,190,413
Issued as reinvestment of dividends............. 157,964 14,421
Redeemed........................................ (139,268,431) (318,282,969)
------------- -------------
Net increase/(decrease)......................... $ (86,112,833) $ 8,921,865
============= =============
</TABLE>
50
<PAGE> 53
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued) NATIONS INSTITUTIONAL
RESERVES
<TABLE>
<CAPTION>
PERIOD ENDED
OCTOBER 31,
1996*
----------------
<S> <C>
NATIONS GOVERNMENT RESERVES (CONTINUED):
Market Class Shares:
Sold............................................ $ 331,900,020
Redeemed........................................ (138,100,000)
-------------
Net increase.................................... $ 193,800,020
=============
</TABLE>
- ---------------
* The Nations Government Reserves Market Class Shares commenced operations on
May 3, 1996.
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- --------------
<S> <C> <C>
NATIONS MUNICIPAL RESERVES:
Capital Class Shares:
Sold............................................ $ 108,793,133 $ 176,646,799
Redeemed........................................ (101,396,041) (160,517,575)
------------- -------------
Net increase.................................... $ 7,397,092 $ 16,129,224
============= =============
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- --------------
<S> <C> <C>
Liquidity Class Shares:
Sold............................................ $143,500,066 $ 60,121,685
Issued as reinvestment of dividends............. 299,694 135,917
Redeemed........................................ (91,145,356 ) (56,115,098)
------------ ------------
Net increase/(decrease)......................... $ 52,654,404 $ 4,142,504
============ ============
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, APRIL 30,
1996 1996
---------------- --------------
<S> <C> <C>
Adviser Class Shares:
Sold............................................ $ 39,336,540 $ 265,087,129
Issued as reinvestment of dividends............. 143,871 71
Redeemed........................................ (85,631,924) (273,698,589)
------------ -------------
Net increase/(decrease)......................... $(46,151,513) $ (8,611,389)
============ =============
</TABLE>
<TABLE>
<CAPTION>
PERIOD ENDED
OCTOBER 31,
1996*
-------------
<S> <C>
Market Class Shares:
Sold............................................ $163,500,020
Redeemed........................................ (61,500,000)
------------
Net increase.................................... $102,000,020
============
</TABLE>
- ---------------
* The Nations Municipal Reserves Market Class Shares commenced operations on May
3, 1996.
51
<PAGE> 54
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued) NATIONS INSTITUTIONAL
RESERVES
5. Concentration of Credit.
The Portfolios invest primarily in money market instruments maturing in one year
or less whose ratings are within the highest ratings categories by a nationally
recognized statistical rating agency or, if not rated, are believed by NBAI or
TradeStreet to be of comparable quality. The ability of the issuers of the
securities held by the Portfolios to meet their obligations may be affected by
economic and political developments in a specific industry, state or region.
6. Capital Loss Carryforward.
As of April 30, 1996, the Portfolios had available for Federal income tax
purposes unused capital losses as follows:
<TABLE>
<CAPTION>
EXPIRING EXPIRING EXPIRING EXPIRING EXPIRING EXPIRING EXPIRING
IN 1998 IN 1999 IN 2000 IN 2001 IN 2002 IN 2003 IN 2004
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Nations Cash Reserves........... -- $270 $2,594 $850 $ 574 -- --
Nations Treasury Reserves....... -- -- -- -- 9,255 $3,324 --
Nations Government Reserves..... -- -- -- -- -- 408 $1,654
Nations Municipal Reserves...... $72 -- -- -- -- 1,080 --
</TABLE>
Under current tax law, capital losses realized after October 31 may be deferred
and treated as occurring on the first day of the following fiscal year. For the
fiscal year ended April 30, 1996, the following Portfolios have elected to defer
losses occurring between November 1, 1995 and April 30, 1996 under these rules,
as follows:
<TABLE>
<CAPTION>
CAPITAL
LOSSES
DEFERRED
--------
<S> <C>
Nations Cash Reserves.......... $ 467
Nations Treasury Reserves...... 21,910
</TABLE>
52
<PAGE> 55
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