<PAGE>
[LOGO]
Dear Shareholder:
We are pleased to present the 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, 1998.
ECONOMIC REVIEW
In the past six months, the Federal Open Market Committee twice moved to
lower the Federal funds rate, easing 25 basis points each time, thus dropping
the Federal funds rate to 5.00%. This action was largely in response to the
risks posed by the continuing global financial crisis on U.S. growth,
exacerbated by the bailout of a major hedge fund.
LOOKING AHEAD
As we look forward, several thoughts come to mind that lead us to remain
optimistic about the economy: 1) interest rates have dropped to thirty-year
lows and the U.S. economy is very rate sensitive; 2) inflation remains in
check; 3) the Federal Reserve Board has moved to lower the target on the
Federal funds rate in an effort to fend off any "credit crunch"; and 4)
Japan's government is attacking its banking crisis with an approach similar
to that used in the U.S. savings and loan crisis in the 1980s.
While the risk for recession in 1999 is growing, we believe conditions in the
U.S. will remain sound and that next year will be another year of positive
economic activity. Consistent monetary policy, a solid fiscal condition, low
inflation and high employment are important ingredients for our economic
picture. As these economic and market conditions evolve, our portfolio
managers will continue to manage the Funds strategically to seek to capture
relative value along the yield curve.
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 Funds to help pursue your short-term cash
management needs.
Sincerely,
A. MAX WALKER ROBERT H. GORDON
PRESIDENT AND CHAIRMAN OF THE BOARD PRESIDENT, NATIONSBANC ADVISORS, INC.
October 31, 1998
MONEY MARKET FUNDS SEEK TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER
SHARE. HOWEVER, THERE CAN BE NO ASSURANCE THAT THE FUNDS WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE. INVESTMENTS IN MONEY
MARKET FUNDS ARE NEITHER INSURED NOR GUARANTEED BY THE U.S. GOVERNMENT.
This report is submitted for the general information of Nations Institutional
Reserves shareholders and must be preceded or accompanied by a current
Nations Institutional Reserves prospectus.
Source for all statistical data: TradeStreet Investment Associates, Inc.
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Maturity Value
(000s) NATIONS CASH RESERVES Date (000s)
- ----------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
CERTIFICATES OF DEPOSIT - DOMESTIC - 3.5%
Bankers Trust:
$ 35,000 5.670% . . . . . . . . . . . . . . . . . . . . . . . . . . 02/26/99 $ 34,995
23,500 5.770% . . . . . . . . . . . . . . . . . . . . . . . . . . 04/28/99 23,486
45,000 5.780% . . . . . . . . . . . . . . . . . . . . . . . . . . 04/28/99 44,989
40,000 5.330%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 39,988
Chase Manhattan Bank USA:
50,000 5.000% . . . . . . . . . . . . . . . . . . . . . . . . . . 02/16/99 50,000
20,000 5.685% . . . . . . . . . . . . . . . . . . . . . . . . . . 08/03/99 19,991
Morgan Guaranty Trust Company,
36,000 5.550% . . . . . . . . . . . . . . . . . . . . . . . . . . 02/02/99 35,976
- ----------------------------------------------------------------------------------------------------
Total Certificates of Deposit - Domestic (Cost $249,425). . . . . . . 249,425
- ----------------------------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT - YANKEE - 6.0%
ABN-Amro Bank,
25,000 5.750% . . . . . . . . . . . . . . . . . . . . . . . . . . 03/31/99 24,994
Bank Nationale de Paris,
30,000 5.710% . . . . . . . . . . . . . . . . . . . . . . . . . . 02/25/99 30,000
Commerzbank,
27,500 5.640% . . . . . . . . . . . . . . . . . . . . . . . . . . 03/02/99 27,485
Credit Agricole,
40,000 5.750% . . . . . . . . . . . . . . . . . . . . . . . . . . 04/01/99 39,992
National Bank of Canada, (New York):
20,000 5.940% . . . . . . . . . . . . . . . . . . . . . . . . . . 12/03/98 20,000
30,000 5.640% . . . . . . . . . . . . . . . . . . . . . . . . . . 01/04/99 30,000
Society Generale, (New York):
25,000 5.700% . . . . . . . . . . . . . . . . . . . . . . . . . . 02/26/99 24,997
16,250 5.700% . . . . . . . . . . . . . . . . . . . . . . . . . . 03/23/99 16,247
29,000 5.800% . . . . . . . . . . . . . . . . . . . . . . . . . . 03/31/99 28,995
30,000 5.750% . . . . . . . . . . . . . . . . . . . . . . . . . . 04/16/99 29,986
30,000 5.800% . . . . . . . . . . . . . . . . . . . . . . . . . . 04/28/99 29,986
125,000 5.323%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 124,903
- ----------------------------------------------------------------------------------------------------
Total Certificates of Deposit - Yankee (Cost $427,585) . . . . . . . . 427,585
- ----------------------------------------------------------------------------------------------------
COMMERCIAL PAPER - 44.5%
AON Corporation:
15,581 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/12/98 15,555
25,066 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/01/98 24,955
34,296 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/07/98 34,118
50,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/08/98 49,724
21,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/22/98 20,844
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
2
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Maturity Value
(000s) NATIONS CASH RESERVES Date (000s)
- ----------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
Commercial Paper (continued)
Bankers Trust:
$ 20,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/24/98 $ 19,930
53,564 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/15/99 52,922
12,500 Discount note. . . . . . . . . . . . . . . . . . . . . . . 02/19/99 12,288
BT Alex Brown,
30,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/21/99 29,624
Burmah Castrol Finance PLC,
16,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/16/98 15,963
Chase Manhattan Corporation,
125,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/29/99 123,399
Countrywide Home Loans:
58,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/02/98 57,991
50,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/18/98 49,872
35,500 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/24/98 35,380
50,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/25/98 49,824
20,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/30/98 19,912
Edison Asset Securitization,
45,000 Discount note (a). . . . . . . . . . . . . . . . . . . . . 04/23/99 43,919
Finova Capital Corporation:
6,034 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/20/98 6,016
27,500 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/05/99 27,232
28,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/29/99 27,624
General Electric Capital Corporation,
200,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/02/98 199,968
General Electric Company,
92,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/31/98 91,213
General Motors Acceptance Corporation,
300,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/02/98 299,952
Hitachi America Ltd.:
30,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/02/98 29,868
15,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/16/98 14,897
21,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 02/24/99 20,661
9,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 04/13/99 8,776
12,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 05/11/99 11,653
16,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 05/14/99 15,533
International Securitization Corporation:
60,500 Discount note (a). . . . . . . . . . . . . . . . . . . . . 11/12/98 60,399
76,146 Discount note (a). . . . . . . . . . . . . . . . . . . . . 12/10/98 75,715
35,250 Discount note (a). . . . . . . . . . . . . . . . . . . . . 04/22/99 34,408
55,050 Discount note (a). . . . . . . . . . . . . . . . . . . . . 04/29/99 53,704
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
3
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Maturity Value
(000s) NATIONS CASH RESERVES Date (000s)
- ----------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMERCIAL PAPER (CONTINUED)
Lehman Brothers Holdings Inc.:
$ 50,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/16/98 $ 49,884
60,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/21/98 59,538
Lexington Parker Capital Company,
75,000 Floating rate (a). . . . . . . . . . . . . . . . . . . . . 04/27/99 75,000
Mitsubishi International Corporation:
60,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/03/98 59,981
45,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/12/98 44,920
10,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/16/98 9,976
17,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/23/98 16,941
65,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/26/99 64,107
50,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/27/99 49,305
National Bank of Canada:
20,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/31/98 19,820
72,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 02/24/99 70,818
PHH Corporation:
50,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/18/98 49,866
33,500 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/09/98 33,302
90,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/20/99 88,888
40,208 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/21/99 39,703
Safeco Credit Corporation:
25,000 Discount note (a). . . . . . . . . . . . . . . . . . . . . 11/12/98 24,958
30,000 Discount note (a). . . . . . . . . . . . . . . . . . . . . 11/19/98 29,917
38,100 Discount note (a). . . . . . . . . . . . . . . . . . . . . 12/04/98 37,908
10,000 Discount note (a). . . . . . . . . . . . . . . . . . . . . 12/09/98 9,944
10,000 Discount note (a). . . . . . . . . . . . . . . . . . . . . 12/10/98 9,944
58,000 Discount note (a). . . . . . . . . . . . . . . . . . . . . 12/14/98 57,631
7,500 Discount note (a). . . . . . . . . . . . . . . . . . . . . 12/18/98 7,448
Safeco Corporation:
20,000 Discount note (a). . . . . . . . . . . . . . . . . . . . . 11/12/98 19,966
20,000 Discount note (a). . . . . . . . . . . . . . . . . . . . . 11/17/98 19,951
12,000 Discount note (a) . . . . . . . . . . . . . . . . . . . . 12/02/98 11,943
90,000 Discount note (a). . . . . . . . . . . . . . . . . . . . . 12/08/98 89,514
30,000 Discount note (a). . . . . . . . . . . . . . . . . . . . . 12/10/98 29,830
Sumitomo Corporation of America:
10,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/19/98 9,972
5,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 12/11/98 4,969
Tulip Funding Corporation:
18,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/10/98 17,976
32,263 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/16/98 32,189
18,627 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/17/98 18,581
25,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/04/99 24,760
45,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/26/99 44,425
100,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 01/28/99 98,680
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
4
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Maturity Value
(000s) NATIONS CASH RESERVES Date (000s)
- ----------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMERCIAL PAPER (CONTINUED)
Variable Funding Capital,
$ 187,000 Discount note. . . . . . . . . . . . . . . . . . . . . . . 11/02/98 $ 186,970
- ----------------------------------------------------------------------------------------------------
Total Commercial Paper (Cost $3,153,364) . . . . . . . . . . 3,153,364
- ----------------------------------------------------------------------------------------------------
BANK NOTE - 1.5% (COST $110,000)
First Union National Bank,
110,000 5.480%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 110,000
- ----------------------------------------------------------------------------------------------------
CORPORATE OBLIGATIONS - 20.0%
Bankers Trust Corporation:
40,000 5.390%**+. . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 39,997
45,000 5.386%**+. . . . . . . . . . . . . . . . . . . . . . . . . 11/16/98++ 45,000
Bear Stearns Company Inc.:
10,000 5.690% . . . . . . . . . . . . . . . . . . . . . . . . . . 02/25/99 9,998
48,000 5.800% . . . . . . . . . . . . . . . . . . . . . . . . . . 06/14/99 48,069
50,000 5.190%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/30/98++ 50,000
Credit Suisse First Boston Inc.,
70,000 5.409%**+. . . . . . . . . . . . . . . . . . . . . . . . . 11/09/98++ 69,930
Goldman Sachs Group:
50,000 5.438%**+. . . . . . . . . . . . . . . . . . . . . . . . . 12/28/98++ 50,000
200,000 5.646%+ (Floating rate promisory note) . . . . . . . . . . 12/28/98++ 200,000
Lehman Brothers Holdings:
20,000 4.870%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/03/98++ 20,000
50,000 5.460%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 50,000
70,000 5.466%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/12/98++ 70,000
40,000 5.530%+. . . . . . . . . . . . . . . . . . . . . . . . . . 12/23/98++ 40,000
13,500 10.000%. . . . . . . . . . . . . . . . . . . . . . . . . . 05/15/99 13,781
Liberty Light US Capital:
25,000 5.760%.. . . . . . . . . . . . . . . . . . . . . . . . . . 07/23/99 24,998
50,000 5.390%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 50,000
50,000 5.390%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 50,000
125,000 5.389%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/16/98++ 124,983
25,000 5.430%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 25,000
Merrill Lynch & Company:
50,000 4.754%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/03/98++ 50,000
70,000 5.370%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 70,000
67,000 5.440%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 67,000
30,000 4.770%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/03/98++ 30,000
Morgan Stanley Dean Witter,
25,000 5.298%+. . . . . . . . . . . . . . . . . . . . . . . . . . 01/15/99++ 24,999
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
5
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Maturity Value
(000s) NATIONS CASH RESERVES Date (000s)
- ----------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
CORPORATE OBLIGATIONS (CONTINUED)
Morgan (J.P.) Company,
$ 20,000 5.750% . . . . . . . . . . . . . . . . . . . . . . . . . . 03/10/99 $ 20,000
PHH Corporation:
25,000 5.346%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/10/98++ 24,990
50,000 5.476%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/16/98++ 50,000
40,000 5.465%+. . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/99++ 39,997
Philip Morris Company:
20,000 7.375% . . . . . . . . . . . . . . . . . . . . . . . . . . 02/15/99 20,084
35,176 8.625% . . . . . . . . . . . . . . . . . . . . . . . . . . 03/01/99 35,489
- ----------------------------------------------------------------------------------------------------
Total Corporate Obligations (Cost $1,414,315) . . . . . . 1,414,315
- ----------------------------------------------------------------------------------------------------
GUARANTEED INVESTMENT CONTRACTS - 7.1%
Commonwealth Life Insurance,
75,000 5.530%**+. . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 75,000
First Allmerica Finance Life Insurances:
50,000 5.780% . . . . . . . . . . . . . . . . . . . . . . . . . . 05/15/03++ 50,000
50,000 5.620% . . . . . . . . . . . . . . . . . . . . . . . . . . 09/22/03++ 50,000
Jackson National Life Insurance Company:
50,000 5.650%** . . . . . . . . . . . . . . . . . . . . . . . . . 01/01/50++ 50,000
50,000 5.410%** . . . . . . . . . . . . . . . . . . . . . . . . . 01/01/99++ 50,000
New York Life Insurance Company,
100,000 5.292%+**. . . . . . . . . . . . . . . . . . . . . . . . . 11/17/98++ 100,000
Peoples Security Life Insurance Company,
25,000 5.450%** . . . . . . . . . . . . . . . . . . . . . . . . . 01/01/50++ 25,000
Travelers Insurance Company:
50,000 5.368%** . . . . . . . . . . . . . . . . . . . . . . . . . 11/12/98++ 50,000
50,000 5.645%** . . . . . . . . . . . . . . . . . . . . . . . . . 01/04/99++ 50,000
- ----------------------------------------------------------------------------------------------------
Total Guaranteed Investment Contracts (Cost $500,000) . . 500,000
- ----------------------------------------------------------------------------------------------------
MUNICIPAL BOND - 0.6% (COST $40,000)
Virginia (State of), Housing Development Authority,
40,000 5.100%+. . . . . . . . . . . . . . . . . . . . . . . . . . 01/01/46++ 40,000
- ----------------------------------------------------------------------------------------------------
TIME DEPOSITS - EURO - 13.9%
Chase Manhattan,
150,000 5.563% . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 150,000
Deutsche Bank,
350,000 5.688% . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 350,000
First Union,
82,000 5.250% . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 82,000
Societe Generale,
50,000 5.563% . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 50,000
</TABLE>
See Notes to Financial Statements.
6
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Principal Amount Maturity Value
(000S) NATIONS CASH RESERVES Date (000S)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
TIME DEPOSITS -- EURO -- (CONTINUED)
Westdeutsche,
$ 350,000 5.688%................................................................. 11/02/98 $ 350,000
- ----------------------------------------------------------------------------------------------------------------
Total Time Deposits -- Euro (Cost $982,000)........................... 982,000
- ----------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT -- 1.4% (Cost $100,000)
Agreement with Merrill Lynch
100,00 5.720% dated 10/30/98 to be repurchased at $100,048 on 11/02/98,
collateralized by $106,271, Discount Commercial Paper due 11/10/98 --
05/03/99 (value $105,055) 100,000
- ----------------------------------------------------------------------------------------------------------------
Shares
- ----------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 1.5%
56,347,559 Aim Liquid Asset Portfolio.............................................. 56,348
18,474,000 Aim Prime Fund.......................................................... 18,474
30,376,000 Dreyfus Cash Management Plus Fund....................................... 30,376
- ----------------------------------------------------------------------------------------------------------------
Total Money Market Funds (Cost $105,198).............................. 105,198
- ----------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (Cost $7,081,887*) 100.0% 7,081,887
- ----------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (NET)...................................... 0.0%#
Other assets............................................................ 33,917
Dividends payable....................................................... (30,530)
Investment advisory fee payable......................................... (980)
Shareholder servicing and distribution fees payable..................... (772)
Accrued Trustees' fees and expenses..................................... (151)
Custodian fees payable.................................................. (36)
Administration fees payable............................................. (67)
Accrued expenses and other liabilities.................................. (473)
- ----------------------------------------------------------------------------------------------------------------
TOTAL OTHER ASSETS AND LIABILITIES (NET)................................ 908
- ----------------------------------------------------------------------------------------------------------------
NET ASSETS.............................................................. 100.0% $7,082,795
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
7
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Value
NATIONS CASH RESERVES (000S)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Capital Class Shares:
($3,808,855,000 DIVIDED BY 3,808,850,249 shares outstanding)...................... $ 1.00
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
Liquidity Class Shares:
($1,300,321,000 DIVIDED BY 1,300,318,724 shares outstanding)...................... $ 1.00
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
Adviser Class Shares:
($810,617,000 DIVIDED BY 810,616,096 shares outstanding)........................... $ 1.00
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
Market Class Shares:
($1,163,002,000 DIVIDED BY 1,163,000,010 shares outstanding)...................... $ 1.00
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
* Aggregate cost for Federal tax purposes.
** Restricted security (Note 5).
+ 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.
# Amount represents less than 0.1%.
(a) Securities are 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, 1998, NET ASSETS CONSIST OF:
Accumulated net realized gain on investments sold.................................. $ 10
Paid-in capital.................................................................... 7,082,785
- ----------------------------------------------------------------------------------------------------------------
NET ASSETS......................................................................... $7,082,795
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
8
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Principal Amount Maturity Value
(000S) NATIONS TREASURY RESERVES Date (000S)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
TIME DEPOSITS -- EURO -- 1.4% (Cost $30,152)
Bank of New York Cayman Island,
$ 30,152 4.750%................................................................. 11/02/98 $ 30,152
- ----------------------------------------------------------------------------------------------------------------
U.S. TREASURY NOTES -- 19.5%
45,000 5.875%#................................................................ 01/31/99 45,043
50,000 5.000%................................................................. 02/15/99 50,039
15,000 5.500%#................................................................ 02/28/99 14,999
75,000 6.375%#................................................................ 04/30/99 75,443
100,000 6.250%................................................................. 05/31/99 100,926
30,000 6.000%#................................................................ 06/30/99 30,089
65,000 5.875%#................................................................ 07/31/99 65,382
50,000 5.875%#................................................................ 08/31/99 50,152
- ----------------------------------------------------------------------------------------------------------------
Total U.S. Treasury Notes (Cost $432,073).......................................... 432,073
- ----------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS -- 86.3%
547,000 Agreement with ABN AMRO,
5.400% dated 10/30/98 to be repurchased at $547,246 on 11/02/98,
collateralized by $532,525 U.S. Government Securities, 3.375% -- 8.875%
due 11/30/98 -- 04/15/28 (value $547,001)......................................... 547,000
105,000 Agreement with Bear Stearns,
5.600% dated 10/30/98 to be repurchased at $105,049 on 11/02/98,
collateralized by $130,454 GNMA, 6.000% -- 8.000% due 06/15/03 --
10/15/28 (value $108,977)......................................................... 105,000
277,113 Agreement with CS First Boston,
Interest is payable monthly. The agreement is terminable by the fund
daily. The final maturity of the agreement is 11/02/98, collateralized
by $412,027 U.S. Treasury Strips Interest only, due 11/15/98 --
05/15/09 (value $286,837)##....................................................... 277,113
90,000 Agreement with Deutsche Bank,
5.400% dated 10/30/98 to be repurchased at $90,041 on 11/02/98,
collateralized by $53,910 U.S. Treasury Bond, 11.250% due 02/15/15
(value $90,000)................................................................... 90,000
50,000 Agreement with Dresdner Kleinwort Benson,
4.900% dated 10/30/98 to be repurchased at $50,020 on 11/02/98,
collateralized by $28,078 U.S. Treasury Bonds, 6.000% -- 11.875% due
11/15/03 -- 02/15/26; $12,000 U.S. Treasury Note, 5.875% due 08/31/99
(value $51,004)........................................................ 50,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
9
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (UNAUDITED)
Principal Amount Value
(000s) NATIONS TREASURY RESERVES (000s)
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
REPURCHASE AGREEMENTS (CONTINUED)
$ 45,000 Agreement with Dresdner Kleinwort Benson,
5.580% dated 10/30/98 to be repurchased at $45,021
on 11/02/98, collateralized by $55,031 GNMA,
6.500% -- 7.000% due 12/20/24 -- 07/15/28
(value $45,901)................................................................... $ 45,000
105,000 Agreement with First Union Capital,
5.420% dated 10/30/98 to be repurchased at $105,047
on 11/02/98, collateralized by $17,642 U.S. Treasury Bills,
due 01/14/99 -- 07/22/99; $1,302 U.S. Treasury Bond,
6.500%, due 11/15/26; $79,688 U.S. Treasury Notes,
5.875% -- 7.750% due 05/15/99 -- 10/15/06 (value $105,095)........................ 105,000
100,000 Agreement with Goldman Sachs & Company,
5.210% dated 10/30/98 to be repurchased at $100,043
on 11/02/98, collateralized by $760,309 GNMA,
5.500% -- 14.000% due 11/15/98 -- 10/20/28
(value $100,000).................................................................. 100,000
105,000 Agreement with HSBC Securities,
5.420% dated 10/30/98 to be repurchased at $105,047
on 11/02/98, collateralized by $73,555 U.S. Treasury Bond,
8.875% due 02/15/19 (value $107,106).............................................. 105,000
110,000 Agreement with J.P. Morgan & Company,
4.830% dated 10/30/98 to be repurchased at $110,207
on 11/03/98, collateralized by $461,635 GNMA,
8.500% -- 9.000% due 03/15/16 -- 01/15/28
(value $110,295).................................................................. 110,000
170,000 Agreement with Lehman Brothers Holdings Inc.,
5.500% dated 10/30/98 to be repurchased at $170,078
on 11/02/98, collateralized by $168,417 U.S. Treasury
Notes, 5.125% -- 6.375% due 05/15/00 -- 08/31/00
(value $173,367).................................................................. 170,000
105,000 Agreement with Morgan Stanley Dean Witter,
5.560% dated 10/30/98 to be repurchased at $105,049
on 11/02/98, collateralized by $166,087 GNMA,
5.500% -- 7.000% due 07/20/23 -- 04/20/28
(value 105,739)................................................................... 105,000
105,000 Agreement with West Deutlandesbank,
5.600% dated 10/30/98 to be repurchased at $105,049
on 11/02/98, collateralized by $189,990 GNMA,
6.875% -- 8.500% due 10/15/17 -- 06/20/24
(value $105,000).................................................................. 105,000
- ----------------------------------------------------------------------------------------------------------------
Total Repurchase Agreements (Cost $1,914,113).................................... $1,914,113
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Value
SHARES NATIONS TREASURY RESERVES (000S)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MONEY MARKET FUNDS -- 3.2%
49,531,000 AIM Treasury Fund.................................................................. $ 49,531
22,050,000 Dreyfus Treasury Cash Management Fund.............................................. 22,050
- ----------------------------------------------------------------------------------------------------------------
Total Money Market Funds (Cost $71,581)............................................ 71,581
TOTAL INVESTMENTS (COST $2,447,919*) ....................................... 110.4% 2,447,919
- ----------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (NET) ........................................ (10.4)%
Other assets....................................................................... 11,109
Receivable for investments matured................................................. 45,000
Payable for reverse repurchase agreement........................................... (277,113)
Dividends payable.................................................................. (8,004)
Shareholder servicing and distribution fees payable................................ (487)
Investment advisory fee payable.................................................... (373)
Accrued Trustees' fees and expenses................................................ (55)
Custodian fees payable............................................................. (13)
Administration fee payable......................................................... (21)
Accrued expenses and other liabilities............................................. (99)
- ----------------------------------------------------------------------------------------------------------------
TOTAL OTHER ASSETS AND LIABILITIES (NET)........................................... (230,056)
- ----------------------------------------------------------------------------------------------------------------
NET ASSETS ................................................................. 100.0% $2,217,863
- ----------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Capital Class Shares:
($466,959,000 DIVIDED BY 466,882,129 shares outstanding).......................... $ 1.00
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
Liquidity Class Shares:
($294,293,000 DIVIDED BY 294,310,720 shares outstanding).......................... $ 1.00
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
Adviser Class Shares:
($345,679,000 DIVIDED BY 345,699,380 shares outstanding).......................... $ 1.00
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
Market Class Shares:
($1,110,932,000 DIVIDED BY 1,111,000,010 shares outstanding)...................... $ 1.00
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
* Aggregate cost for Federal tax purposes.
# Denotes securities subject to repurchase under reverse repurchase agreements as of October 31, 1998.
## Security segregated as collateral for reverse repurchase agreement.
- ----------------------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1998, NET ASSETS CONSIST OF:
Accumulated net realized loss on investments sold.................................. $ (30)
Paid-in capital.................................................................... 2,217,893
- ----------------------------------------------------------------------------------------------------------------
NET ASSETS......................................................................... $2,217,863
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Principal Amount Maturity Value
(000S) NATIONS GOVERNMENT RESERVES Date (000S)
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 46.8%
FEDERAL FARM CREDIT BANK (FFCB) -- 2.6%
$ 6,000 5.700%.............................................................. 11/03/98 $ 6,000
11,000 5.650%.............................................................. 01/04/99 11,000
- ---------------------------------------------------------------------------------------------------------------
17,000
- ---------------------------------------------------------------------------------------------------------------
FEDERAL HOME LOAN BANK (FHLB) -- 20.7%
8,000 Discount note....................................................... 11/13/98 7,987
7,000 Discount note....................................................... 12/11/98 6,959
8,000 Discount note....................................................... 01/04/99 7,928
7,151 Discount note....................................................... 02/11/99 7,044
6,000 Discount note....................................................... 02/12/99 5,915
6,901 Discount note....................................................... 04/14/99 6,756
20,000 4.620%+............................................................. 11/04/98++ 19,999
6,000 5.415%.............................................................. 02/10/99 5,999
15,000 5.570%.............................................................. 03/09/99 14,999
9,000 5.650%.............................................................. 04/09/99 8,999
4,000 5.705%.............................................................. 05/05/99 4,013
13,000 4.574%+............................................................. 11/04/98++ 12,998
12,000 5.510%.............................................................. 07/06/99 11,992
12,000 5.240%+............................................................. 11/02/98++ 12,000
- ---------------------------------------------------------------------------------------------------------------
133,588
- ---------------------------------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) NOTES -- 13.6%
4,000 Discount note....................................................... 11/06/98 3,997
5,034 Discount note....................................................... 11/12/98 5,026
6,000 Discount note....................................................... 12/10/98 5,968
8,000 Discount note....................................................... 01/07/99 7,923
8,000 Discount note....................................................... 01/08/99 7,921
8,905 Discount note....................................................... 01/15/99 8,809
8,000 Discount note....................................................... 01/22/99 7,905
8,000 Discount note....................................................... 01/26/99 7,904
6,703 Discount note....................................................... 02/05/99 6,610
7,000 Discount note....................................................... 02/16/99 6,903
5,000 Discount note....................................................... 02/17/99 4,929
8,000 Discount note....................................................... 02/19/99 7,884
3,293 Discount note....................................................... 03/12/99 3,232
3,108 Discount note....................................................... 03/29/99 3,048
- ---------------------------------------------------------------------------------------------------------------
88,059
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
12
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Principal Amount Maturity Value
(000s) NATIONS GOVERNMENT RESERVES Date (000s)
- ---------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATION (CONTINUED)
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) -- 4.5%
$ 8,000 Discount note....................................................... 02/18/99 $ 7,885
5,000 5.660%.............................................................. 11/20/98 5,000
8,000 4.441%+............................................................. 11/03/98++ 7,998
8,000 5.630%.............................................................. 05/05/99 7,998
- ---------------------------------------------------------------------------------------------------------------
28,881
- ---------------------------------------------------------------------------------------------------------------
STUDENT LOAN MARKETING ASSOCIATION (SLMA) -- 5.4%
17,000 5.400%.............................................................. 02/10/99 16,993
12,000 5.190%+............................................................. 11/02/98++ 11,992
6,000 5.510%.............................................................. 09/16/99 6,000
- ---------------------------------------------------------------------------------------------------------------
34,985
- ---------------------------------------------------------------------------------------------------------------
Total U.S. Government Agency Obligations (Cost $302,513)........... 302,513
- ---------------------------------------------------------------------------------------------------------------
TIME DEPOSITS -- EURO -- 2.8% (Cost $17,847)
Bank of New York Cayman Island,
17,847 4.750%.............................................................. 11/02/98 17,847
- ---------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS -- 49.1%
157,000 Agreement with ABN-AMRO,
5.625% dated 10/30/98 to be repurchased at $157,074 on 11/02/98, collateralized
by $156,092 U.S. Government Agency Securities, 5.107% -- 6.850% due 12/24/98 --
03/04/08 (value $157,000)........................................................ 157,000
140,000 Agreement with First Union Capital Markets,
5.620% dated 10/30/98 to be repurchased at $140,066 on 11/02/98,
collateralized by $136,134 U.S. Government Agency Securities, 4.915%
-- 10.000% due 11/23/98 -- 07/15/45 (value $140,000)................ 140,000
20,000 Agreement with Goldman Sachs,
5.210% dated 10/30/98 to be repurchased at $20,009 on 11/02/98,
collateralized by $41,715,000 GNMA, 6.000% -- 9.000% due 10/15/07 --
10/15/28 (value $20,000)............................................ 20,000
- ---------------------------------------------------------------------------------------------------------------
Total Repurchase Agreements (Cost $317,000)........................ 317,000
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
13
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Value
SHARES NATIONS GOVERNMENT RESERVES (000s)
- -------------------------------------------------------------------------------------------------------------
<C> <S> <C>
MONEY MARKET FUND -- 1.4% (Cost $9,105)
9,105,000 Dreyfus Treasury Cash Management Fund........................................... $ 9,105
- -------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (Cost $646,465*) .................................... 100.1% 646,465
- -------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (NET) ...................................... (0.1)%
Other assets.................................................................... 2,204
Dividends payable............................................................... (2,600)
Shareholder servicing and distribution fees payable............................. (152)
Investment advisory fee payable................................................. (94)
Accrued Trustees' fees and expenses............................................. (22)
Administration fee payable...................................................... (6)
Accrued expenses and other liabilities.......................................... (8)
- -------------------------------------------------------------------------------------------------------------
TOTAL OTHER ASSETS AND LIABILITIES (NET)...................................... (678)
- -------------------------------------------------------------------------------------------------------------
NET ASSETS .............................................................. 100.0% $ 645,787
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Capital Class Shares:
($160,300,000 DIVIDED BY 160,300,511 shares outstanding)........................ $ 1.00
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
Liquidity Class Shares:
($42,718,000 DIVIDED BY 42,718,892 shares outstanding).......................... $ 1.00
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
Adviser Class Shares:
($115,769,000 DIVIDED BY 115,769,079 shares outstanding)........................ $ 1.00
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
Market Class Shares:
($327,000,000 DIVIDED BY 327,000,010 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.
- -------------------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1998 NET ASSETS CONSIST OF:
Accumulated net realized loss on investments sold............................... $ (1)
Paid-in capital................................................................. 645,788
- -------------------------------------------------------------------------------------------------------------
NET ASSETS...................................................................... $ 645,787
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
14
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- -------------------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES -- 99.3%
ALABAMA -- 3.5%
Alabama (State of), Housing Finance Authority Revenue,
(Multi-Family Housing-SKI III A), (Credit Suisse First Boston),
$ 6,100 3.100% due 03/01/15++.......................................................... $ 6,100
Arab, Alabama, Industrial Development Board, IDR,
(Syncro Corporation Project), AMT,
(SouthTrust Bank of Alabama LOC),
680 3.350% due 06/01/02++ (a)...................................................... 680
Foley, Alabama, Industrial Development Board, IDR,
(Vulcan Inc. Project),
(AmSouth Bank of Alabama LOC),
1,600 3.250% due 12/01/00++ (a)...................................................... 1,600
North, Alabama, Environmental Improvement Authority, PCR,
(Reynolds Metals Company), (Bank of Nova Scotia LOC),
1,000 3.650% due 12/01/00+........................................................... 1,000
Phoenix (County of), Alabama, Industrial Development Board:
(Georgia Kraft Project), (Deutsche Bank A.G. LOC),
1,350 3.700% due 12/01/15+........................................................... 1,350
(Mead Coated Board Project), (Toronto Dominion Bank LOC),
2,470 3.750% due 06/01/28+........................................................... 2,470
- -------------------------------------------------------------------------------------------------------------
13,200
- -------------------------------------------------------------------------------------------------------------
ARIZONA -- 3.6%
Apache (County of), Arizona, Industrial Development Authority,
(Tucson Electric Power Company), (Toronto Dominion Bank LOC),
7,700 3.150% due 12/15/18++.......................................................... 7,700
Arizona (State of), Educational Loan Marketing Corporation,
Educational Loan Revenue, Refunding Series A,
(Guaranteed Student Loans),
3,250 6.550% due 03/01/99............................................................ 3,279
Maricopa (County of), Arizona, Corporate PCR, Refunding,
(Arizona Public Service Company) Series A,(Morgan Guaranty LOC)
1,300 3.700% due 05/01/29+........................................................... 1,300
Pinal (County of), Arizona, Industrial Development Authority,
PCR, (Magma Copper Company Project),
(Banque Nationale de Paris LOC),
1,000 3.100% due 12/01/11++.......................................................... 1,000
- -------------------------------------------------------------------------------------------------------------
13,279
- -------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
15
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Value
SHARES NATIONS MUNICIPAL RESERVES (000s)
- -------------------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA -- 1.5%
California (State of), Higher Education Loan Authority, Student
Loan Revenue, Refunding, Sr Lien Series A-1, (Sallie Mae LOC),
$ 2,500 3.650% due 07/01/99+........................................................... $ 2,500
Los Angeles, California, Regional Airports Improvement, Corporate
Lease Revenue, Sublease LA Int'l-LAX2, (Societe Generale LOC),
400 3.650% due 12/01/25+........................................................... 400
Regional Airports Improvement Corporation, Los Angeles, California,
(Los Angeles International Airport), (Societe Generale LOC),
1,500 3.750% due 12/01/25+........................................................... 1,500
San Diego, California, IDR, (Kaiser Aerospace and Electric Project),
Series A, AMT, (ABN-AMRO Bank LOC),
1,200 2.900% due 10/01/07++.......................................................... 1,200
- -------------------------------------------------------------------------------------------------------------
5,600
- -------------------------------------------------------------------------------------------------------------
COLORADO -- 6.1%
Colorado (State of), Health Facilities Authority Revenue,
(Goodwill Industries), (Bank One of Denver LOC),
1,485 3.150% due 12/01/04++ (a)...................................................... 1,485
Colorado (State of), Post Secondary Educational Authority, Economic
Development Revenue, (U.S. Swimming), (Banc One of Denver LOC),
3,070 3.150% due 06/01/11++ (a)...................................................... 3,070
Colorado (State of), Student Obligation Authority, Student Loan
Revenue, (Student Loan Marketing Association LOC): Series C,
3,600 3.050% due 08/01/00++.......................................................... 3,600
AMT, Series B
2,000 3.150% due 07/01/20++.......................................................... 2,000
Denver, Colorado, City & County Multi-Family Housing Revenue,
(Merrill Lynch guarantee and liquidity)
4,985 3.350% due 10/15/08++.......................................................... 4,985
Larimer (County of), Colorado, IDR, (Ultimate Support System Project),
Series A, (Bank One of Denver LOC),
1,035 3.150% due 06/01/10++ (a)...................................................... 1,035
Moffat (County of), Colorado, PCR, (National Rural Utility Cooperation),
(Societe Generale liquidity), (AMBAC insured)
3,000 3.200% due 07/01/10++ (a)...................................................... 3,000
Pitkin (County of) Colorado, IDR,
(Aspen Skiing Co., Project) Series A,
(First National Bank of Chicago LOC),
3,500 3.700% due 04/01/16+ (a)....................................................... 3,500
- -------------------------------------------------------------------------------------------------------------
22,675
- -------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
16
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- -------------------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
FLORIDA -- 5.2%
Brevard (County of), Florida, Multi-family Housing Authority Revenue,
(Malabar Lakes & Park Village), Series A,
(U.S. Bank, Minneapolis LOC),
$ 2,775 3.200% due 12/01/10++.......................................................... $ 2,775
Florida Housing Finance Agency, (FLTF -- Multi-family- Lake-RMK),
(SouthTrust Bank of Alabama LOC),
1,700 3.250% due 06/01/07++.......................................................... 1,700
Fort Walton Beach, Florida, IDR, (Burton Golf Inc. Project), AMT,
(Columbus Bank & Trust Company LOC),
1,845 3.400% due 10/01/11++.......................................................... 1,845
Indian River (County of), Florida, Hospital District Revenue,
(Kredietbank N.V. LOC),
7,000 3.200% due 10/01/15++.......................................................... 7,000
Orange (County of), Florida, Health Facilities Authority Revenue,
(Mayflower Retirement Community Project),
(Rabobank Nederland LOC),
800 3.100% due 03/01/18++.......................................................... 800
Palm Beach, (County of), Florida, Revenue,
(Norton Gallery Inc. Project), (Northern Trust LOC),
5,500 3.050% due 05/01/25++.......................................................... 5,500
- -------------------------------------------------------------------------------------------------------------
19,620
- -------------------------------------------------------------------------------------------------------------
GEORGIA -- 10.0%
Burke (County of), Georgia, Development Authority, PCR,
(Georgia Power Company Vogtle):
2nd Series,
3,000 3.700% due 04/01/25+........................................................... 3,000
3rd Series,
2,2700 3.700% due 09/01/25+........................................................... 2,200
Clayton (County of), Georgia, Multi-family Housing Revenue,
(FSA insured) (Barclays Bank PLC, liquidity):
Refunding, (Chateau Forest Apartments) Series E,
1,140 3.150% due 01/01/21++.......................................................... 1,140
(Ten Oaks Apartments) Series F,
3,945 3.150% due 01/01/21++.......................................................... 3,945
Cobb (County of), Georgia, Development Authority Revenue,
Refunding, (Highlands Park Associates Project), (Suntrust Bank LOC),
2,000 3.150% due 08/01/08++.......................................................... 2,000
Cobb (County of), Georgia, Residential Care Facilities for the Elderly
Authority Revenue, Refunding, (Presbyterian VLG Austell),
(Suntrust Bank LOC),
1,900 3.150% due 08/01/15++.......................................................... 1,900
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
17
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- -------------------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
GEORGIA (CONTINUED)
Columbia (County of), Georgia, Elderly Authority,
Residential Care Facilities Revenue, (Augusta Res Ctr on Aging),
(SunTrust Company Bank LOC),
$ 3,585 3.150% due 01/01/21++ (a) $ 3,585
De Kalb (County of), Georgia, Housing Authority,
Multi-family Housing Revenue, (Cedar Creek Apartments Project),
AMT, (General Electric Capital Corporation Guaranty),
1,400 3.300% due 12/01/20++.......................................................... 1,400
Fulton (County of), Georgia, Development Authority Revenue:
(Alfred & Adele Davis Inc.), (Suntrust Bank LOC),
3,500 3.150% due 12/01/10++.......................................................... 3,500
(Georgia Tech Athletic Association Inc.), (Trust Company Bank LOC),
3,500 3.150% due 07/01/14++.......................................................... 3,500
(Lovett School Project), (Suntrust Bank LOC),
3,000 3.150% due 04/01/17++.......................................................... 3,000
Georgia (State of), Municipal Electricity Authority,
Project One-Sub Series D-Rmkt 4/11/97, (ABM-AMRO LOC)
1,150 3.250% due 01/01/22++.......................................................... 1,150
Smyrna, Georgia, Multi-family Housing Authority Revenue,
(Hills of Post Village Project), (FNMA Collateral Agreement),
7,000 3.150% due 06/01/25++.......................................................... 7,000
- -------------------------------------------------------------------------------------------------------------
37,320
- -------------------------------------------------------------------------------------------------------------
IDAHO -- 0.6%
Power (County of), Idaho, PCR, (FMC Corporation Project),
(Wachovia Bank LOC),
2,200 3.750% due 12/01/10+........................................................... 2,200
- -------------------------------------------------------------------------------------------------------------
ILLINOIS -- 6.0%
Chicago, Illinois, O'Hare International Airport, American Airlines Inc:
Series A, (Credit Suisse LOC),
2,000 3.700% due 12/01/17+........................................................... 2,000
Series D, (Royal Bank of Canada LOC),
1,050 3.700% due 12/01/17+........................................................... 1,050
Illinois (State of), Development Financial Authority Revenue,
(Chicago Symphony), (Northern Trust Company LOC):
2,000 3.050% due 12/01/28++.......................................................... 2,000
(Park Ridge Youth Campus Project),
2,000 3.250% due 09/01/18++.......................................................... 2,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
18
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- -------------------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
ILLINOIS (CONTINUED)
Illinois (State of), Development Financial Authority, PCR, Refunding,
(Commonwealth Edison Company Project Series B),
(ABN Amro Bank NV LOC),
$ 2,000 3.050% due 10/15/14++.......................................................... $ 2,000
Illinois (State of), Development Financial Authority, IDR:
(Quality Screw & Nut Company Project), AMT, (NBD Bank N.A.LOC),
1,700 3.350% due 05/01/15++.......................................................... 1,700
(Randolph Pickle Corporation Project), AMT, (NBD Bank N.A. LOC),
870 3.350% due 06/01/12++.......................................................... 870
(Unique Building Corporation Project), AMT, (NBD Bank N.A. LOC),
2,300 3.350% due 05/01/09++.......................................................... 2,300
Illinois (State of), Education Facilities Authority Revenue,
(Northwestern University), (NBD Bank N.A. SBPA),
1,400 3.150% due 12/01/25++.......................................................... 1,400
Illinois (State of), Health Facilities Authority Revenue,
(Northwestern Memorial Hospital), (Northern Trust Liquidity)
3,600 3.700% due 08/15/25+........................................................... 3,600
Lombard, Illinois, Multifamily Housing,
(Clover Creek Apartment Project), (Continental Casualty Guaranty),
1,975 4.000% due 12/15/06............................................................ 1,975
Lombard Village, Illinois, Industrial Project Revenue, B&H Partnership,
(Comerica Bank LOC),
1,500 3.450% due 10/01/13++.......................................................... 1,500
- -------------------------------------------------------------------------------------------------------------
22,395
- -------------------------------------------------------------------------------------------------------------
INDIANA -- 2.1%
Auburn, Indiana, Economic Development Revenue, (RJ Tower
Corporation Project), AMT, (Comerica Bank LOC),
760 3.300% due 09/01/00++.......................................................... 760
Indiana (State of), Health Facilities, Financing Authority Revenue,
(Cardinal Center), Series A, (Key Bank, N.A. LOC),
2,085 3.250% due 12/01/16++ (a)...................................................... 2,085
Indianapolis, Indiana, Economic Development, (EDGCOMB Metals Co.),
(Banque Nationale Paris LOC),
2,700 3.100% due 12/01/08++.......................................................... 2,700
Kendallville, Indiana, Revenue, (McCray Memorial Hospital Project),
770 3.250% due 01/01/04++ (a)...................................................... 770
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
19
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- -------------------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
INDIANA (CONTINUED)
Princeton, Indiana, PCR, Refunding, PSI, (Energy Inc. Project),
(Canadian Imperial Bank LOC),
$ 1,200 3.750% due 03/01/19+........................................................... $ 1,200
Rockport, Indiana, PCR, (AEP Generating Company Project B),
(AMBAC Guaranty, BONY Liquidity)
265 3.750% due 07/01/25+........................................................... 265
- -------------------------------------------------------------------------------------------------------------
7,780
- -------------------------------------------------------------------------------------------------------------
KENTUCKY -- 1.1%
Jefferson (County of), Kentucky, IDR,
(Belknap Inc Project), (National City Bank LOC),
1,160 3.550% due 12/01/14++ (a)...................................................... 1,160
Jefferson (County of), Kentucky, Industrial Building Revenue,
(Seven Counties Services Inc. Project), (Banc One LOC),
1,440 3.150% due 06/01/11++ (a)...................................................... 1,440
Jeffersontown, Kentucky, Industrial Building Revenue,
(Raque Food System Inc. Project), AMT, (PNC Bank LOC),
1,700 3.300% due 04/01/20++ (a)...................................................... 1,700
- -------------------------------------------------------------------------------------------------------------
4,300
- -------------------------------------------------------------------------------------------------------------
LOUISIANA -- 6.3%
Ascension Parish, Louisiana, PCR:
(Borden Inc Project), (Credit Suisse First Boston LOC),
8,000 3.150% due 12/01/09++.......................................................... 8,000
Refunding, (Shell Oil Company Project),
7,400 3.700% due 09/01/23+........................................................... 7,400
Lake Charles, Louisiana, (Citgo Petroleum Corporation),
(Westdeutsche Landesbank LOC),
2,300 3.250% due 08/01/07++.......................................................... 2,300
Louisiana (State of), Offshore Terminal Authority, Deepwater Port
Revenue, Refunding, 1st Stage Series A, (Loop Inc.), (UBS_AG_LOC),
1,300 3.700% due 09/01/08+........................................................... 1,300
South Louisiana, Port Community Marine Terminal Facilities Revenue,
(Occidental Petroleum), (UBS_AG LOC),
4,500 3.000% due 07/01/21++.......................................................... 4,500
- -------------------------------------------------------------------------------------------------------------
23,500
- -------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
20
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
OCTOBER 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- -------------------------------------------------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
MARYLAND -- 4.0%
Baltimore, Maryland, Industrial Development Authority,
Baltimore Capital Acquisition, (Bayerische Landesbank LOC),
$ 15,000 3.100% due 08/01/16++.......................................................... $ 15,000
Montgomery (County of), Maryland, IDR,
(Information Systems and Network Corporation Project),
(PNC Bank LOC),
170 3.650% due 04/01/14++ (a)...................................................... 170
- -------------------------------------------------------------------------------------------------------------
15,170
- -------------------------------------------------------------------------------------------------------------
MICHIGAN -- 0.7%
Delta (County of), Michigan, Economic Development, Corporate
Environmental Improvement Revenue, (Mead-Escanaba Paper Series F), (Bank of
Nova Scotia LOC),
1,000 3.700% due 12/01/13+........................................................... 1,000
University of Michigan, Medical Service Plan -- Series A,
1,800 3.750% due 12/01/27++.......................................................... 1,800
- -------------------------------------------------------------------------------------------------------------
2,800
- -------------------------------------------------------------------------------------------------------------
MINNESOTA -- 0.6%
Minneapolis, Minnesota, Revenue, (Catholic Charities Project),
(Norwest Bank Minnesota LOC),
2,410 3.150% due 11/01/16++ (a)...................................................... 2,410
- -------------------------------------------------------------------------------------------------------------
MISSISSIPPI -- 0.7%
Flowood, Mississippi, IDR,
(BSC Steel Inc. Project), AMT, (PNC Bank LOC),
2,500 3.300% due 11/01/01++ (a)...................................................... 2,500
- -------------------------------------------------------------------------------------------------------------
MISSOURI -- 2.3%
Missouri, (State of), Health & Educational Facilities Authority Revenue,
(Morgan Guaranty Trust SBPA):
(Washington University, Series B),
1,800 3.150% due 09/01/10++.......................................................... 1,800
(Sisters of Mercy-Ref-B), (ABN-AMRO SBPA),
6,700 3.100% due 06/01/14++.......................................................... 6,700
- -------------------------------------------------------------------------------------------------------------
8,500
- -------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
21
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
NEBRASKA - 0.6%
Douglas (County of), Nebraska, School District #017 Milliard, BAN,
$ 2,250 4.250% due 01/15/99. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,252
- ------------------------------------------------------------------------------------------------------------------
NEVADA - 0.9%
Grand Forks, Nevada, Hospital Facilities Revenue,
(United Hospital Obligation Group Project),
(Lasalle National Bank LOC),
3,250 3.650% due 12/01/16+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,250
300 3.650% due 12/01/25+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300
- ------------------------------------------------------------------------------------------------------------------
3,550
- ------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 1.3%
New Jersey (State of), Higher Education Assistance Authority Student
Loan Revenue, FLTR Certificates Series 18, (Morgan Stanley liquidity),
(AMBAC Insured)
5,000 3.360% due 06/01/17++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000
- ------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 1.6%
Dona Ana (County of), New Mexico, Industrial Development Revenue,
(Foamex Products Inc Project), (Bank of Nova Scotia LOC),
5,900 3.100% due 11/01/13++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 5,900
- ------------------------------------------------------------------------------------------------------------------
OHIO - 9.2%
Centerville, Ohio, Health Care Revenue,
(Bethany Lutheran Village Project),(PNC Bank of Ohio LOC),
960 3.150% due 11/01/13++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 960
Clinton (County of), Ohio, Airport Facilities Revenue, Refunding,
(Wilmington Air PK Inc.), (Wachovia Bank of NC),
5,000 3.150% due 06/01/11++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000
Cuyahoga (County of), Ohio, IDR,
(Pleasant Lake Project), (Key Bank, N.A. LOC),
895 3.250% due 05/01/11++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 895
Greene (County of), Ohio, IDR,
(AFC Stamping Project), AMT, (Key Bank, N.A. LOC),
1,000 3.400% due 09/01/16++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,000
Lucas (County of), Ohio, Revenue, Facilities Improvement,
(Toledo Project), (Keybank LOC),
10,000 3.250% due 10/01/05++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
22
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
OHIO (CONTINUED)
Lucas (County of), Ohio, IDR,
(Dynamic Dies Inc., Project), (National City Bank LOC), AMT
$ 2,060 3.300% due 07/01/09++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,060
Ohio (State of), Air Quality Development Authority Revenue,
Daily-Conversion 12/8/95, Series B, (Morgan (J.P.) LOC),
3,600 3.700% due 12/01/15++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,600
Ohio (State of), Housing Finance Agency, Multi-family Housing
Revenue, Kenwood Congregate Retirement Community,
(Morgan Guaranty Trust Company LOC),
2,279 3.500% due 12/01/15++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,279
Ohio (State of), PCR, Refunding, (Sohio Water Project),
1,210 3.700% due 05/01/22+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,210
Ottawa (County of), Ohio, BAN,
5,000 4.000% due 08/06/99++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,012
Summit (County of), Ohio, IDR,
(Oliver Printing Project), AMT, (Bank One Akron LOC),
1,350 3.250% due 02/01/07++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,350
Toledo-Lucas (County of), Ohio, Port Authority Facilities Improvement
Revenue, (Young Mens Christian Association), (Fifth Third Bank LOC),
1,065 3.350% due 12/01/21++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,065
- ------------------------------------------------------------------------------------------------------------------
34,431
- ------------------------------------------------------------------------------------------------------------------
OREGON - 2.8%
Oregon (State of), Housing & Community Services Department
Mortgage Revenue, (Single Family Mortgage PG-Series J),
4,595 3.850% due 12/03/98. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,595
Port Portland, Oregon, Industrial Development, Refunding,
(Schnitzer Steel Project), (Comerica Bank LOC),
2,000 3.200% due 11/01/07++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000
Port Portland, Oregon, Special Obligation Revenue,
(Horizon Air Industries Inc. Project), (Bank of Montreal LOC),
4,100 3.750% due 06/15/27+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,100
- ------------------------------------------------------------------------------------------------------------------
10,695
- ------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 3.5%
Delaware (County of), Pennsylvania, Industrial Development Authority,
PCR, (BP Oil Inc. Project),
3,900 3.700% due 12/01/09+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,900
1,000 3.700% due 10/01/19+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
23
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
PENNSYLVANIA (CONTINUED)
Elk (County of), Pennsylvania, IDR, (Clarion Project),
(PNC Bank LOC)
$ 3,100 3.300% due 03/01/09 (a). . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,100
Philadelphia, Pennsylvania, Authority for IDRs,
(Fox Chase Cancer Center Project), (Morgan Guaranty LOC)
2,100 3.700% due 07/01/25+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,100
Schuylkill (County of), Pennsylvania, Industrial Development Authority
Revenue, (PNC Bank LOC):
(Bon-Ton Stores Project), AMT,
1,240 3.150% due 02/01/12++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,240
(Bon-Ton Stores Project),
1,760 3.300% due 02/01/12++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,760
- ------------------------------------------------------------------------------------------------------------------
13,100
- ------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 3.2%
Anderson (County of), South Carolina, Industrial Revenue,
(Mikron Corporation), (UBS AG LOC), AMT,
4,000 3.250% due 11/01/12++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,000
Cherokee (County of), South Carolina, IDR,
(Holmberg Electric Corporation Project), (Wachovia Bank LOC),
1,000 3.500% due 11/01/04++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,000
South Carolina (State of), Jobs, Economic Development Authority
Revenue: (Chambers Oakridge Landfill), AMT, (Morgan Guaranty
Trust Company LOC),
1,300 3.250% due 12/01/01++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,300
(Greenville Baptist Project), (Wachovia Bank of NC),
3,100 3.150% due 10/01/19++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 3,100
(Spartanburg Young Mens Project), (First Union National Bank LOC),
1,800 3.150% due 06/01/18++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,800
York (County of), South Carolina, PCR, (CFC Guaranty),
700 3.200% due 09/15/14 .. . . . . . . . . . . . . . . . . . . . . . . . . . . . 700
- ------------------------------------------------------------------------------------------------------------------
11,900
- ------------------------------------------------------------------------------------------------------------------
SOUTH DAKOTA - 0.2%
South Dakota (State of), Economic Development Finance Authority,
IDR, (Lomar Development Company Project),
Series B, AMT, (U.S. Bank LOC),
730 3.500% due 08/01/08++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 730
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
24
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
TENNESSEE - 4.6%
Dickson (County of), Tennessee, Industrial Development Board,
Renaissance Learning Center, (Suntrust Bank LOC),
$ 2,000 3.150% due 11/01/12++. . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,000
Franklin (County of), Tennessee, Health & Educational Facilities Board
Revenue, (University of the South-Series B), (Amsouth Bank LOC),
6,685 3.100% due 09/01/18++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,685
Jefferson City, Tennessee, Industrial Development Board,
(BA Property Project), AMT, (American National B&T LOC),
1,265 3.200% due 11/01/24++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,265
Metropolitan Nashville, Tennessee, Airport Authority Special Facilities
Revenue, (American Airlines Project-Series B), (Bayerische
Lankesbank LOC),
5,600 3.650% due 10/01/12+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,600
Springfield, Tennessee, Industrial Development Board,
All American Homes of Tennessee, AMT, (NBD Bank N.A. LOC),
1,700 3.350% due 11/15/09++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,700
- ------------------------------------------------------------------------------------------------------------------
17,250
- ------------------------------------------------------------------------------------------------------------------
TEXAS - 9.5%
Grapevine, Texas, Industrial Development Corporation Revenue,
(Morgan Guaranty Trust LOC):
(American Airlines, Series A1),
400 3.650% due 12/01/24+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 400
(American Airlines, Series A2),
100 3.650% due 12/01/24+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
(American Airlines, Series B2),
1,100 3.650% due 12/01/24+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,100
Guadalupe-Blanco, Texas, PCR, Refunding,
(Central Power & Light Company Project), (ABN Amro Bank LOC),
3,200 3.750% due 11/01/15+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,200
Harris (County of ), Texas, Health Facilities Development Corporation,
Hospital Revenue, (Methodist Hospital), (Morgan Guaranty SBPA):
2,900 3.700% due 12/01/25+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,900
4,000 3.700% due 12/01/26+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,000
Lone Star, Texas, Airport Improvement Authority,
(Royal Bank of Canada LOC): (American Airlines DEM-A-1),
600 3.650% due 12/01/14+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 600
(American Airlines DEM-A-2),
700 3.650% due 12/01/14+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700
(American Airlines DEM-A-4),
930 3.650% due 12/01/14+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 930
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
25
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
<S> <C> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
TEXAS (CONTINUED)
(American Airlines DEM-B-1),
$ 900 3.650% due 12/01/14+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 900
(American Airlines DEM-B-2),
300 3.650% due 12/01/14+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300
(American Airlines DEM-B-3),
1,100 3.650% due 12/01/14+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,100
McAllen, Texas, Health Facilities Development Corporation Revenue,
(McAllen Associate No. 1), (PNC Bank LOC),
4,300 3.300% due 12/01/24++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,300
Nueces (County of), Texas, Health Facilities Development Corporation
Revenue, (Driscoll Foundation Children's Project),
(Bank One of Texas LOC),
1,200 3.200% due 07/01/15++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,200
Sabine River Authority, Texas, PCR, Refunding,
(Texas Utilities Electric Company Project Series A), (AMBAC
Insured, BONY Liquidity),
4,000 3.750% due 03/01/26+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,000
Texas (State of), Municipal Gas Corporation, Gas Reserves Revenue,
Sr Lien, (Societe Generale SBPA), (FSA Insured),
5,000 3.050% due 01/15/23++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000
Trinity River, Texas, Industrial Development Authority, IDR Bond,
(Toys R Us Project), Series 1994, (Bankers Trust Company LOC),
1,000 3.225% due 11/01/14++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,000
West Side Calhoun (County of), Texas,
Development Authority Revenue, (Sohio Chemical Corp Project),
3,900 3.700% due 12/01/15+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,900
- ------------------------------------------------------------------------------------------------------------------
35,630
- ------------------------------------------------------------------------------------------------------------------
VIRGINIA - 4.8%
Albemarle (County of),Virginia, Industrial Development Authority,
Health Services Revenue, (University of Virginia Services Foundation),
(First Union National Bank (North Carolina) LOC),
5,800 3.100% due 02/01/26++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,800
Madison (County of), Virginia, Industrial Development Authority,
IDR, (Madison Wood Preservers),
(Wachovia Bank of NC LOC), AMT
7,125 3.200% due 06/01/13++. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,125
Richmond, Virginia, Equip Notes,
3,595 4.250% due 05/15/99. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,603
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
26
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Value
(000s) NATIONS MUNICIPAL RESERVES (000s)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
VIRGINIA (CONTINUED)
Winchester, Virginia, Industrial Development Authority Revenue,
Midwesco Filter, (Harris Trust & Savings Bank LOC),
$ 1,575 3.450% due 08/01/07++. . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,575
- ------------------------------------------------------------------------------------------------------------------
18,103
- ------------------------------------------------------------------------------------------------------------------
WASHINGTON - 0.2%
Port Skagit (County of), Washington, Industrial Development Authority
Revenue, (Cascade Clear Water Company Project), AMT, (Key Bank
of Washington LOC),
800 3.400% due 12/01/20++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 800
- ------------------------------------------------------------------------------------------------------------------
WEST VIRGINIA - 0.4%
Ohio (County of), West Virginia, IDR,
(Ohio Valley Clarksburg Drug Company Project), (PNC Bank LOC),
AMT,
1,600 3.850% due 12/01/01++ (a). . . . . . . . . . . . . . . . . . . . . . . . . . 1,600
- ------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.8%
Menasha, Wisconsin, JT School District, TRAN,
3,000 3.150% due 09/30/99. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,001
Milwaukee, Wisconsin, IDR,
(Mandel Company Project), AMT, (U.S. Bank LOC),
940 3.500% due 04/01/07 ++ . . . . . . . . . . . . . . . . . . . . . . . . . . . 940
Watertown, Wisconsin, School District, TRAN,
3,000 3.100% due 10/28/99. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,002
- ------------------------------------------------------------------------------------------------------------------
6,943
- ------------------------------------------------------------------------------------------------------------------
WYOMING - 0.4%
Sublette (County of), Wyoming, PCR, (Exxon Project Series-A),
(Guaranty Agreement), AMT
1,500 3.800% due 07/01/17+ (a) . . . . . . . . . . . . . . . . . . . . . . . . . . 1,500
- ------------------------------------------------------------------------------------------------------------------
Total Municipal Bonds and Notes (Cost $372,633) . . . . . . . . . . . . . . 372,633
- ------------------------------------------------------------------------------------------------------------------
Shares
- ------------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS - 0.6%
1,650,000 AIM Tax-Exempt Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,650
575,000 Federated Tax-Exempt Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . 575
- ------------------------------------------------------------------------------------------------------------------
Total Money Market Funds (Cost $2,225). . . . . . . . . . . . . . . . . . . 2,225
- ------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (Cost $374,858*) . . . . . . . . . . . . . . . . . . . 99.9% $ 374,858
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
27
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Value
NATIONS MUNICIPAL RESERVES (000s)
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
OTHER ASSETS AND LIABILITIES (NET) . . . . . . . . . . . . . . . . . . . . 0.1%
Other assets.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,778
Dividends payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (963)
Shareholder servicing and distribution fees payable . . . . . . . . . . . . . (72)
Investment advisory fee payable . . . . . . . . . . . . . . . . . . . . . . . (28)
Accrued Trustees' fees and expenses . . . . . . . . . . . . . . . . . . . . . (12)
Administration fee payable . . . . . . . . . . . . . . . . . . . . . . . . . . (3)
Accrued expenses and other liabilities . . . . . . . . . . . . . . . . . . . . (188)
- -------------------------------------------------------------------------------------------------------------------
TOTAL OTHER ASSETS AND LIABILITIES (NET) . . . . . . . . . . . . . . . . . . . 512
- -------------------------------------------------------------------------------------------------------------------
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.0% $ 375,370
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Capital Class Shares:
($117,664,000 DIVIDED BY 117,664,588 shares outstanding) . . . . . . . . . . . $ 1.00
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Liquidity Class Shares:
($66,738,000 DIVIDED BY 66,738,031 shares outstanding) . . . . . . . . . . . . $ 1.00
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Adviser Class Shares:
($49,969,000 DIVIDED BY 49,969,376 shares outstanding) . . . . . . . . . . . . $ 1.00
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Market Class Shares:
($140,999,000 DIVIDED BY 141,000,100 shares outstanding) . . . . . . . . . . . $ 1.00
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
* Aggregate cost for Federal tax purposes.
+ Variable rate demand notes payable upon not more than one business
day's notice. The interest rate shown reflects the rate currently
in effect.
++ Variable rate demand notes payable upon not more than seven
calendar days' notice. The interest rate shown reflects the rate
currently in effect.
(a) Securities are not registered under the Securities Act of 1933.
These securities may be resold in transactions exempt from
registration to qualified institutional buyers.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
<S> <C>
AT OCTOBER 31, 1998, NET ASSETS CONSIST OF:
Accumulated net realized loss on investment sold. . . . . . . . . . . . . . . $ (2)
Paid-in capital.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 375,372
- -------------------------------------------------------------------------------------------------------------------
NET ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 375,370
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
28
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Maturity Value
(000s) NATIONS MONEY MARKET RESERVES Date (000s)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
CERTIFICATES OF DEPOSIT - DOMESTIC - 4.9%
Chase Manhattan Bank USA:
$ 50,000 5.000%. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 02/16/99 $ 50,000
5,000 5.685%. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 08/03/99 4,998
- -------------------------------------------------------------------------------------------------------------------------------
Total Certificates of Deposit - Domestic (Cost $54,998). . . . . . . . . . 54,998
- -------------------------------------------------------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT - YANKEE - 2.2%
Societe Generale (NY):
20,000 5.142%+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/20/98++ 19,980
5,000 5.323%+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 4,997
- -------------------------------------------------------------------------------------------------------------------------------
Total Certificates of Deposit - Yankee (Cost $24,977). . . . . . . . . . . . . . . . . 24,977
- -------------------------------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER - 56.0%
Asset Securitization Cooperative Corp.,
60,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/12/98 59,902
Associates Corporation of North America,
50,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 49,992
Bayerische Hypo,
50,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 49,992
Caisse Des Depots Et Consignations,
50,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 49,992
Edison Securitization L.L.C.,
50,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/12/98 49,919
Ford Motor Credit Company,
50,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 49,992
General Electric Company,
8,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12/31/98 7,932
General Motors Acceptance Corporation,
50,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 49,992
Hitachi America Ltd.,
5,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 05/14/99 4,854
International Securitization Corporation:
30,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/12/98 29,950
10,255 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 04/29/99 10,005
Koch Industries Inc.,
50,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 49,992
National Bank of Canada,
8,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 02/24/99 7,869
Tulip Funding Corporation:
17,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/10/98 16,977
46,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 01/04/99 45,558
WCP Funding,Inc.
50,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 01/21/99 49,412
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
29
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Principal Amount Maturity Value
(000s) NATIONS MONEY MARKET RESERVES Date (000s)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMERCIAL PAPER (CONTINUED)
Xerox Corporation,
$ 50,000 Discount note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 $ 49,992
- -------------------------------------------------------------------------------------------------------------------------------
Total Commercial Paper (Cost $632,322) . . . . . . . . . . . . . . . . . . 632,322
- -------------------------------------------------------------------------------------------------------------------------------
BANK NOTE - 4.4% (Cost $50,000)
First Union National Bank,
50,000 5.480%+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 50,000
- -------------------------------------------------------------------------------------------------------------------------------
CORPORATE OBLIGATIONS - 9.5%
Bankers Trust Corporation,
5,000 5.386%+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12/14/98++ 5,000
Bear Stearns & Company Inc.:
40,000 5.800%. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 06/14/99++ 40,057
5,000 5.190%+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/30/98++ 5,000
Credit Suisse First Boston Inc.,
50,000 5.409%+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/09/98++ 49,950
Merrill Lynch & Company,
8,000 5.440%+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98++ 8,000
- -------------------------------------------------------------------------------------------------------------------------------
Total Corporate Obligations (Cost $108,007). . . . . . . . . . . . . . . . 108,007
- -------------------------------------------------------------------------------------------------------------------------------
TIME DEPOSITS - EURO - 11.5%
Deutsche Bank,
50,000 5.688% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 50,000
Societe General,
30,000 5.563% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 30,000
Westdeutsche Landesbank Girozentrale,
50,000 5.688% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11/02/98 50,000
- -------------------------------------------------------------------------------------------------------------------------------
Total Time Deposits - Euro (Cost $130,000) . . . . . . . . . . . . . . . . 130,000
- -------------------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT - 8.9% (Cost $100,000)
Agreement with Morgan (J.P.) Securities Inc.,
100,000 5.550% dated 10/30/98 to be repurchased at $100,046
on 11/02/98, collateralized by $440,165 GNMA,
9.000% due 05/15/16 - 02/15/28 (value $100,000). . . . . . . . . . . . . . . 100,000
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
30
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Value
Shares NATIONS MONEY MARKET RESERVES (000s)
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
MONEY MARKET FUNDS - 2.8%
17,837,000 Aim Liquid Asset Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . $ 17,837
13,976,000 Dreyfus Cash Management Plus Fund . . . . . . . . . . . . . . . . . . . . . . 13,976
- --------------------------------------------------------------------------------------------------------------
Total Money Market Funds (Cost $31,813). . . . . . . . . . . . . . . . . . 31,813
- --------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (Cost $1,132,117*). . . . . . . . . . . . . . . . . . 100.2% 1,132,117
- --------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (NET). . . . . . . . . . . . . . . . . . . (0.2)%
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,534
Dividends payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,661)
Investment advisory fee payable . . . . . . . . . . . . . . . . . . . . . . . (121)
Shareholder servicing and distribution fees payable . . . . . . . . . . . . . (277)
Accrued Trustees' fees and expenses . . . . . . . . . . . . . . . . . . . . . (1)
Administration fees payable . . . . . . . . . . . . . . . . . . . . . . . . . (9)
Accrued expenses and other liabilities. . . . . . . . . . . . . . . . . . . . (6)
- --------------------------------------------------------------------------------------------------------------
TOTAL OTHER ASSETS AND LIABILITIES (NET). . . . . . . . . . . . . . . . . . . (2,541)
- --------------------------------------------------------------------------------------------------------------
NET ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.0% $1,129,576
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Capital Class Shares:
($190,743,000 DIVIDED BY 190,744,591 shares outstanding). . . . . . . . . . . $ 1.00
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
Liquidity Class Shares:
($607,000 DIVIDED BY 607,047 shares outstanding). . . . . . . . . . . . . . . $ 1.00
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
Adviser Class Shares:
($3,233,000 DIVIDED BY 3,232,639 shares outstanding). . . . . . . . . . . . . $ 1.00
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
Market Class Shares:
($934,993,000 DIVIDED BY 935,000,010 shares outstanding). . . . . . . . . . . $ 1.00
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
</TABLE>
* 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.
SEE NOTES TO FINANCIAL STATEMENTS.
31
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF NET ASSETS (CONTINUED) NATIONS INSTITUTIONAL RESERVES
October 31, 1998 (unaudited)
Value
NATIONS MONEY MARKET RESERVES (000s)
- --------------------------------------------------------------------------------------------------------------
<S> <C>
AT OCTOBER 31, 1998, NET ASSETS CONSIST OF:
Accumulated net realized loss
on investments sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (12)
Undistributed net investment income . . . . . . . . . . . . . . . . . . . . . 4
Paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,129,584
- --------------------------------------------------------------------------------------------------------------
NET ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,129,576
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
</TABLE>
ABBREVIATIONS:
AMT -- Alternative Minimum Tax
BAN -- Bond Anticipation Notes
CFC -- Cooperative Finance Corporation
FNMA -- Federal National Mortgage Association
FSA -- Financial Security Assurance
GO -- General Obligation Bonds
IDR -- Industrial Development Revenue
LOC -- Letter of Credit
MBIA -- Municipal Bond Investors Assurance
PCR -- Pollution Control Revenue
SBPA -- Standby Bond Purchase Agreement
TRAN -- Tax and Revenue Anticipation Notes
SEE NOTES TO FINANCIAL STATEMENTS.
32
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF OPERATIONS NATIONS INSTITUTIONAL RESERVES
For the Six Months Ended October 31, 1998 (unaudited)
CASH TREASURY GOVERNMENT MUNICIPAL MONEY MARKET MONEY MARKET
RESERVES RESERVES RESERVES RESERVES RESERVES (a) RESERVES (b)
- -----------------------------------------------------------------------------------------------------------------------------------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
Investment Income:
Interest. . . . . . . . . . . . . . . $ 184,002 $ 49,001 $ 15,338 $ 5,350 $ 6,792 $ 3,690
Dividends . . . . . . . . . . . . . . 2,076 1,720 205 48 214 --
- -----------------------------------------------------------------------------------------------------------------------------------
Total Investment Income. . . . . . 186,078 50,721 15,543 5,398 7,006 3,690
- -----------------------------------------------------------------------------------------------------------------------------------
Expenses:
Investment advisory fee . . . . . . . 9,868 2,797 843 459 388 64
Administration fee. . . . . . . . . . 3,289 932 281 152 129 50
Transfer agent fees . . . . . . . . . 72 25 20 22 14 16
Custodian fees. . . . . . . . . . . . 166 39 24 14 10 11
Trustees' fees and expenses . . . . . 49 14 4 2 1 --
Registration and filing fees. . . . . 504 65 31 47 23 4
Legal and audit fees. . . . . . . . . 51 17 8 5 4 13
Other . . . . . . . . . . . . . . . . 58 21 11 4 2 13
- -----------------------------------------------------------------------------------------------------------------------------------
Subtotal . . . . . . . . . . . . . 14,057 3,910 1,222 705 571 171
Shareholder servicing
and distribution fees:
Capital Class Shares . . . . . . . -- -- -- -- -- --
Liquidity Class Shares . . . . . . 5,376 1,933 143 205 3 --
Adviser Class Shares . . . . . . . 921 382 117 59 3 --
Market Class Shares. . . . . . . . 2,221 1,331 677 271 277 --
Fees waived by investment adviser,
administrator and distributor. . . (12,268) (3,900) (903) (617) (318) (44)
- -----------------------------------------------------------------------------------------------------------------------------------
Net Expenses . . . . . . . . . . . 10,307 3,656 1,256 623 536 127
- -----------------------------------------------------------------------------------------------------------------------------------
Net Investment Income . . . . 175,771 47,065 14,287 4,775 6,470 3,563
- -----------------------------------------------------------------------------------------------------------------------------------
Net Realized Gain/(Loss)
on Investments. . . . . . . . (17) (2) -- (1) 1 --
- -----------------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting From Operations. . . . $ 175,754 $ 47,063 $ 14,287 $ 4,774 $ 6,471 $ 3,563
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) For the period from May 16, 1998 through October 31, 1998.
(b) Represents financial information for the Emerald Prime Advantage
Institutional Fund, which was reorganized into Money Market Reserves
on May 22, 1998. Certain amounts have been reclassified to conform to
the current period's presentation.
SEE NOTES TO FINANCIAL STATEMENTS.
33
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF CASH FLOWS NATIONS INSTITUTIONAL RESERVES
For the Six Months Ended October 31, 1998 (unaudited)
TREASURY RESERVES
- -------------------------------------------------------------------------------------------------------------
(IN THOUSANDS)
<S> <C> <C>
Cash flows from operating and investing activities:
Interest income received. . . . . . . . . . . . . . . . . . . . . . . . . $ 41,270
Dividend income received. . . . . . . . . . . . . . . . . . . . . . . . . 1,662
Payment of operating expenses . . . . . . . . . . . . . . . . . . . . . . (3,262)
Net proceeds from reverse repurchase agreements outstanding . . . . . . . 85,767
Net purchases of short-term investments . . . . . . . . . . . . . . . . . (680,307)
- -------------------------------------------------------------------------------------------------------------
Cash used by operating and investing activities ** . . . . . . . . . . . . . $(554,870)
Cash flows from financing activities:
Proceeds from shares sold **. . . . . . . . . . . . . . . . . . . . . . . 5,443,705
Payments on shares redeemed . . . . . . . . . . . . . . . . . . . . . . . (4,858,500)
Distributions paid *. . . . . . . . . . . . . . . . . . . . . . . . . . . (30,334)
- -------------------------------------------------------------------------------------------------------------
Cash provided by financing activities. . . . . . . . . . . . . . . . . . . . 554,871
- -------------------------------------------------------------------------------------------------------------
Increase in cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Cash at beginning of period. . . . . . . . . . . . . . . . . . . . . . . . . 0
- -------------------------------------------------------------------------------------------------------------
Cash at end of period. . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
RECONCILIATION OF NET INCREASE IN NET ASSETS FROM OPERATIONS TO CASH
USED BY OPERATING AND INVESTING ACTIVITIES:
Net increase in net assets resulting from operations . . . . . . . . . . . . $ 47,063
Increase in investments . . . . . . . . . . . . . . . . . . . . . . . . . $ (679,741)
Increase in payable for reverse repurchase agreement transactions . . . . 85,767
Increase in interest and dividends receivable . . . . . . . . . . . . . . (8,354)
Decrease in other assets. . . . . . . . . . . . . . . . . . . . . . . . . 164
Increase in accrued expenses and other payables . . . . . . . . . . . . . 231
- -------------------------------------------------------------------------------------------------------------
Cash used by operating and investing activities ** . . . . . . . . . . . . . $ (554,870)
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
</TABLE>
* Non-cash activities include reinvestment of dividends of $10,560.
** Non-cash activities include acquisition of Emerald Treasury Advantage
Fund net assets of $144,375 in exchange for shares of the Portfolio.
(Note 9)
SEE NOTES TO FINANCIAL STATEMENTS.
34
<PAGE>
[ This page intentionally left blank ]
35
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS NATIONS INSTITUTIONAL RESERVES
For the Six Months Ended October 31, 1998 (unaudited)
CASH TREASURY GOVERNMENT MUNICIPAL MONEY MARKET MONEY MARKET
RESERVES RESERVES RESERVES RESERVES RESERVES(a) RESERVES(b)(c)
- ----------------------------------------------------------------------------------------------------------------------------------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
Net investment income. . . . . . . . . . . $ 175,771 $47,065 $ 14,287 $ 4,775 $ 6,470 $ 3,563
Net realized gain (loss) on investments . . (17) (2) -- (1) 1 --
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting
from operations . . . . . . . . . . . . 175,754 47,063 14,287 4,774 6,471 3,563
Distributions to shareholders from
net investment income:
Capital Class Shares . . . . . . . . (97,909) (14,185) (3,560) (1,497) (3,550) (3,563)
Liquidity Class Shares . . . . . . . (33,588) (10,897) (867) (767) (16) --
Adviser Class Shares . . . . . . . . (19,179) (7,651) (2,378) (719) (70) --
Market Class Shares. . . . . . . . . (25,095) (14,332) (7,482) (1,792) (2,834) --
Net increase/(decrease) in net assets from
shares of beneficial interest transactions: 1,601,464 740,142 77,744 126,111 1,010,695 (59,028)
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) in net assets. . 1,601,447 740,140 77,744 126,110 1,010,696 (59,028)
Net assets:
Beginning of period. . . . . . . . . . . . 5,481,348 1,477,723 568,043 249,260 118,880 177,908
- ----------------------------------------------------------------------------------------------------------------------------------
End of period (e). . . . . . . . . . . . . $7,082,795 $2,217,863 $ 645,787 $ 375,370 $1,129,576 $ 118,880
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) For the period from May 16, 1998 through October 31, 1998.
(b) Represents financial information for the Emerald Prime Advantage
Institutional Fund, which was reorganized into Money Market Reserves
on May 22, 1998. Certain amounts have been reclassified to conform to
the current period's presentation.
(c) For the period December 1, 1997 through May 15, 1998.
(d) For the year ended November 30, 1997.
(e) Includes undistributed net investment income of $--, $--, $--, $--, $4
and $4 respectively.
SEE NOTES TO FINANCIAL STATEMENTS.
36
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS NATIONS INSTITUTIONAL RESERVES
For the Year Ended April 30, 1998
CASH TREASURY GOVERNMENT MUNICIPAL MONEY MARKET
RESERVES RESERVES RESERVES RESERVES RESERVES (b)(d)
- ------------------------------------------------------------------------------------------------------------------------------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Net investment income. . . . . . . . . . . . . . $ 204,354 $ 49,848 $ 24,685 $ 8,161 $ 7,902
Net realized gain on investments . . . . . . . . 30 -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting
from operations . . . . . . . . . . . . . . . 204,384 49,848 24,685 8,161 7,902
Distributions to shareholders from net
investment income:
Capital Class Shares . . . . . . . . . . . (122,110) (13,736) (9,042) (2,352) (7,902)
Liquidity Class Shares . . . . . . . . . . (29,597) (13,290) (1,783) (1,798) --
Adviser Class Shares . . . . . . . . . . . (27,433) (12,530) (2,427) (948) --
Market Class Shares. . . . . . . . . . . . (25,214) (10,292) (11,433) (3,063) --
Net increase/(decrease) in net assets from
shares of beneficial interest transactions: . 2,796,684 649,521 192,840 49,287 44,864
- ------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets . . . . . . . . . . . 2,796,714 649,521 192,840 49,287 44,864
Net assets:
Beginning of year. . . . . . . . . . . . . . . . 2,684,634 828,202 375,203 199,973 133,044
- ------------------------------------------------------------------------------------------------------------------------------
End of year. . . . . . . . . . . . . . . . . . . $ 5,481,348 1,477,723 $ 568,043 $ 249,260 $ 177,908
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
37
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Share outstanding of each class of Cash Reserves throughout each period.
SIX MONTHS
ENDED YEAR PERIOD YEAR PERIOD YEAR
10/31/98 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 4/30/98 4/30/97 4/30/96 4/30/95 4/30/94
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period
Capital Class . . . . . . . . . . . . . . . . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Liquidity Class . . . . . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 1.00
Adviser Class*. . . . . . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 --
Market Class* . . . . . . . . . . . . . . . . 1.00 1.00 1.00 -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Net investment income
Capital Class . . . . . . . . . . . . . . . . 0.0275 0.0554 0.0531 0.0570 0.0480 0.0283
Liquidity Class . . . . . . . . . . . . . . . 0.0268 0.0539 0.0516 0.0555 0.0471 0.0273
Adviser Class*. . . . . . . . . . . . . . . . 0.0263 0.0529 0.0506 0.0545 0.0316 --
Market Class* . . . . . . . . . . . . . . . . 0.0257 0.0519 0.0493 -- -- --
Dividends from net investment income
Capital Class . . . . . . . . . . . . . . . . (0.0275) (0.0554) (0.0531) (0.0570) (0.0480) (0.0283)
Liquidity Class . . . . . . . . . . . . . . . (0.0268) (0.0539) (0.0516) (0.0555) (0.0471) (0.0273)
Adviser Class*. . . . . . . . . . . . . . . . (0.0263) (0.0529) (0.0506) (0.0545) (0.0316) --
Market Class* . . . . . . . . . . . . . . . . (0.0257) (0.0519) (0.0493) -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, end of period
Capital Class . . . . . . . . . . . . . . . . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Liquidity Class . . . . . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 1.00
Adviser Class*. . . . . . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 --
Market Class* . . . . . . . . . . . . . . . . 1.00 1.00 1.00 -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Total Return++
Capital Class . . . . . . . . . . . . . . . . 2.79% 5.70% 5.44% 5.84% 4.91% 2.87%
Liquidity Class . . . . . . . . . . . . . . . 2.71% 5.53% 5.28% 5.70% 4.81% 2.77%
Adviser Class*. . . . . . . . . . . . . . . . 2.66% 5.43% 5.19% 5.58% 3.20% --
Market Class* . . . . . . . . . . . . . . . . 2.60% 5.33% 5.04% -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets/supplemental data:
Net assets, end of period (000s)
Capital Class. . . . . . . . . . . . . . . $ 3,808,855 $ 3,051,559 $ 1,684,233 $ 607,433 $ 134,064 $ 109,852
Liquidity Class. . . . . . . . . . . . . . 1,300,321 1,107,869 419,851 35,477 2 69,786
Adviser Class* . . . . . . . . . . . . . . 810,617 672,417 247,551 397,809 47,682 --
Market Class*. . . . . . . . . . . . . . . 1,163,002 649,503 333,000 -- -- --
Ratio of operating expenses to average
net assets
Capital Class. . . . . . . . . . . . . . . 0.20%+ 0.20%** 0.20% 0.20% 0.29% 0.45%
Liquidity Class. . . . . . . . . . . . . . 0.35%+ 0.35%** 0.35% 0.35% 0.38% 0.55%
Adviser Class* . . . . . . . . . . . . . . 0.45%+ 0.45%** 0.45% 0.45% 0.54%+ --
Market Class*. . . . . . . . . . . . . . . 0.57%+ 0.55%** 0.55%+ -- -- --
Ratio of net investment income to average
net assets
Capital Class. . . . . . . . . . . . . . . 5.46%+ 5.54% 5.32% 5.53% 4.96% 2.83%
Liquidity Class. . . . . . . . . . . . . . 5.31%+ 5.39% 5.17% 5.38% 4.87% 2.74%
Adviser Class* . . . . . . . . . . . . . . 5.21%+ 5.29% 5.07% 5.28% 4.71%+ --
Market Class*. . . . . . . . . . . . . . . 5.09%+ 5.19% 4.97%+ -- -- --
Ratio of operating expenses to average
net assets without waivers
Capital Class. . . . . . . . . . . . . . . 0.43%+ 0.44% 0.45% 0.51% 0.52% 0.56%
Liquidity Class. . . . . . . . . . . . . . 1.28%+ 1.29% 0.60% 0.66% 0.61% 0.65%
Adviser Class* . . . . . . . . . . . . . . 0.68%+ 0.69% 0.70% 0.76% 0.77%+ --
Market Class*. . . . . . . . . . . . . . . 0.88%+ 0.89% 0.80%+ -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* The commencement dates of the Classes of Shares of the Portfolios were as
follows:
Nations Cash Reserves Adviser Class - September 22, 1994.
Nations Cash Reserves Market Class - May 3, 1996.
** The effect of interest expense on the operating expense ratio was less
than 0.01%
+ Annualized.
++ Total return represents aggregate total return for the periods indicated.
SEE NOTES TO FINANCIAL STATEMENTS.
38
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Share outstanding of each class of Treasury Reserves throughout each period
SIX MONTHS
ENDED YEAR PERIOD YEAR PERIOD YEAR
10/31/98 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 4/30/98 4/30/97 4/30/96 4/30/95 4/30/94
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period
Capital Class . . . . . . . . . . . . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Liquidity Class . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 1.00
Adviser Class*. . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 --
Market Class* . . . . . . . . . . . . 1.00 1.00 1.00 -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Net Investment Income
Capital Class . . . . . . . . . . . . 0.0269 0.0541 0.0519 0.0556 0.0480 0.0298
Liquidity Class . . . . . . . . . . . 0.0262 0.0526 0.0504 0.0541 0.0462 0.0263
Adviser Class*. . . . . . . . . . . . 0.0257 0.0516 0.0494 0.0531 0.0308 --
Market Class* . . . . . . . . . . . . 0.0251 0.0505 0.0481 -- -- --
Dividends from net investment income
Capital Class . . . . . . . . . . . . (0.0269) (0.0541) (0.0519) (0.0556) (0.0480) (0.0298)
Liquidity Class . . . . . . . . . . . (0.0262) (0.0526) (0.0504) (0.0541) (0.0462) (0.0263)
Adviser Class*. . . . . . . . . . . . (0.0257) (0.0516) (0.0494) (0.0531) (0.0308) --
Market Class* . . . . . . . . . . . . (0.0251) (0.0505) (0.0481) -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, end of period
Capital Class . . . . . . . . . . . . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Liquidity Class . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 1.00
Adviser Class*. . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 --
Market Class* . . . . . . . . . . . . 1.00 1.00 -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Total Return++
Capital Class . . . . . . . . . . . . 2.72% 5.55% 5.30% 5.71% 4.91% 3.02%
Liquidity Class . . . . . . . . . . . 2.63% 5.38% 5.15% 5.57% 4.71% 2.67%
Adviser Class*. . . . . . . . . . . . 2.58% 5.28% 5.06% 5.45% 3.11% --
Market Class* . . . . . . . . . . . . 2.53% 5.18% 4.92% -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets/
supplemental data:
Net assets, end of period (000s)
Capital Class. . . . . . . . . . . $ 466,959 $ 246,058 $ 468,975 $ 304,342 $ 251,694 $ 338,504
Liquidity Class. . . . . . . . . . 294,293 743,410 81,575 11,804 674 14,227
Adviser Class* . . . . . . . . . . 345,679 222,760 154,256 175,691 55,762 --
Market Class*. . . . . . . . . . . 1,110,932 265,495 123,396 -- -- --
Ratio of operating expenses to
average net assets
Capital Class. . . . . . . . . . . 0.20%+ 0.20% 0.20% 0.20% 0.20% 0.20%
Liquidity Class. . . . . . . . . . 0.35%+ 0.35% 0.35% 0.35% 0.49% 0.55%
Adviser Class* . . . . . . . . . . 0.45%+ 0.45% 0.45% 0.45% 0.45%+ --
Market Class*. . . . . . . . . . . 0.57%+ 0.55% 0.55%+ -- -- --
Ratio of net investment income to
average net assets
Capital Class. . . . . . . . . . . 5.24%+ 5.41% 5.20% 5.50% 4.79% 2.99%
Liquidity Class. . . . . . . . . . 5.09%+ 5.26% 5.05% 5.35% 4.50% 2.67%
Adviser Class* . . . . . . . . . . 4.99%+ 5.16% 4.95% 5.25% 4.54%+ --
Market Class*. . . . . . . . . . . 4.86%+ 5.06% 4.85%+ -- -- --
Ratio of operating expenses to
average net assets without waivers
Capital Class. . . . . . . . . . . 0.42%+ 0.45% 0.46% 0.51% 0.50% 0.52%
Liquidity Class. . . . . . . . . . 1.32%+ 1.35% 0.61% 0.66% 0.79% 0.87%
Adviser Class* . . . . . . . . . . 0.67%+ 0.70% 0.71% 0.76% 0.75%+ --
Market Class*. . . . . . . . . . . 0.87%+ 0.90% 0.81%+ -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* The commencement dates of the Classes of Shares of the Portfolios were as
follows:
Nations Treasury Reserves Adviser Class - September 22, 1994.
Nations Treasury Reserves Market Class - May 3, 1996.
+ Annualized.
++ Total return represents aggregate total return for periods indicated.
SEE NOTES TO FINANCIAL STATEMENTS.
39
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Share outstanding of each class of Government Reserves throughout each
period.
SIX MONTHS
ENDED YEAR PERIOD YEAR PERIOD YEAR
10/31/98 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 4/30/98 4/30/97 4/30/96 4/30/95 4/30/94
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period
Capital Class . . . . . . . . . . . . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Liquidity Class . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 1.00
Adviser Class*. . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 --
Market Class* . . . . . . . . . . . . 1.00 1.00 1.00 -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Net Investment Income
Capital Class . . . . . . . . . . . . 0.0269 0.0543 0.0520 0.0556 0.0463 0.0278
Liquidity Class . . . . . . . . . . . 0.0262 0.0528 0.0505 0.0537 0.0453 0.0268
Adviser Class*. . . . . . . . . . . . 0.0257 0.0518 0.0495 0.0527 0.0299 --
Market Class* . . . . . . . . . . . . 0.0251 0.0508 0.0482 -- -- --
Dividends from net investment income
Capital Class . . . . . . . . . . . . (0.0269) (0.0543) (0.0520) (0.0556) (0.0463) (0.0278)
Liquidity Class . . . . . . . . . . . (0.0262) (0.0528) (0.0505) (0.0537) (0.0453) (0.0268)
Adviser Class*. . . . . . . . . . . . (0.0257) (0.0518) (0.0495) (0.0527) (0.0299) --
Market Class* . . . . . . . . . . . . (0.0251) (0.0508) (0.0482) -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, end of period
Capital Class . . . . . . . . . . . . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Liquidity Class . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 1.00
Adviser Class*. . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 --
Market Class* . . . . . . . . . . . . 1.00 1.00 1.00 -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Total Return++
Capital Class . . . . . . . . . . . . 2.73% 5.57% 5.33% 5.71% 4.72% 2.82%
Liquidity Class . . . . . . . . . . . 2.66% 5.40% 5.19% 5.51% 4.59% 2.71%
Adviser Class*. . . . . . . . . . . . 2.61% 5.30% 5.07% 5.39% 3.04% --
Market Class* . . . . . . . . . . . . 2.54% 5.20% 4.93% -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets/
supplemental data:
Net assets, end of period (000s)
Capital Class. . . . . . . . . . . $ 160,300 $ 190,607 $ 125,377 $ 58,121 $ 2 $ 10,819
Liquidity Class. . . . . . . . . . 42,718 32,773 6,482 129 2 259,836
Adviser Class* . . . . . . . . . . 115,769 70,164 24,845 108,168 99,246 --
Market Class*. . . . . . . . . . . 327,000 274,499 218,499 -- -- --
Ratio of operating expenses to average
net assets
Capital Class. . . . . . . . . . . 0.20%+ 0.20% 0.20%(a) 0.20% 0.32% 0.45%
Liquidity Class. . . . . . . . . . 0.35%+ 0.35% 0.35%(a) 0.35% 0.40% 0.55%
Adviser Class* . . . . . . . . . . 0.45%+ 0.45% 0.45%(a) 0.45% 0.57%+ --
Market Class*. . . . . . . . . . . 0.57%+ 0.55% 0.55%+(a) -- -- --
Ratio of net investment income to average
net assets
Capital Class. . . . . . . . . . . 5.33%+ 5.43% 5.22% 5.48% 4.35% 2.78%
Liquidity Class. . . . . . . . . . 5.18%+ 5.28% 5.07% 5.33% 4.27% 2.68%
Adviser Class* . . . . . . . . . . 5.08%+ 5.18% 4.97% 5.23% 4.10%+ --
Market Class*. . . . . . . . . . . 4.96%+ 5.08% 4.87%+ -- -- --
Ratio of operating expenses to average
net assets
without waivers
Capital Class. . . . . . . . . . . 0.44%+ 0.45% 0.49%(a) 0.53% 0.54% 0.51%
Liquidity Class. . . . . . . . . . 1.29%+ 1.30% 0.64%(a) 0.68% 0.62% 0.61%
Adviser Class* . . . . . . . . . . 0.69%+ 0.70% 0.74%(a) 0.78% 0.79%+ --
Market Class*. . . . . . . . . . . 0.89%+ 0.90% 0.84%+(a) -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* The commencement dates of the Classes of Shares of the Portfolios
were as follows:
Nations Government Reserves Adviser Class - September 22, 1994.
Nations Government Reserves Market Class - May 3, 1996.
+ Annualized.
++ Total return represents aggregate total return for periods indicated.
(a) The effect of the fees reduced by credits allowed by the custodian on
the operating expense ratio, with and without waivers, was less than
0.01%
SEE NOTES TO FINANCIAL STATEMENTS.
40
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Share outstanding of each class of Municipal Reserves throughout each
period.
SIX MONTHS
ENDED YEAR PERIOD YEAR PERIOD YEAR
10/31/98 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 4/30/98 4/30/97 4/30/96 4/30/95 4/30/94
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period
Capital Class . . . . . . . . . . . . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Liquidity Class . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 1.00
Adviser Class*. . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 --
Market Class* . . . . . . . . . . . . 1.00 1.00 1.00 -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Net Investment Income
Capital Class . . . . . . . . . . . . 0.0170 0.0353 0.0337 0.0362 0.0313 0.0198
Liquidity Class . . . . . . . . . . . 0.0162 0.0341 0.0323 0.0347 0.0304 0.0188
Adviser Class*. . . . . . . . . . . . 0.0157 0.0332 0.0313 0.0337 0.0199 --
Market Class* . . . . . . . . . . . . 0.0151 0.0318 0.0301 -- -- --
Dividends from net investment income
Capital Class . . . . . . . . . . . . (0.0170) (0.0353) (0.0337) (0.0362) (0.0313) (0.0198)
Liquidity Class . . . . . . . . . . . (0.0162) (0.0341) (0.0323) (0.0347) (0.0304) (0.0188)
Adviser Class*. . . . . . . . . . . . (0.0157) (0.0332) (0.0313) (0.0337) (0.0199) --
Market Class* . . . . . . . . . . . . (0.0151) (0.0318) (0.0301) -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, end of period
Capital Class . . . . . . . . . . . . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Liquidity Class . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 1.00
Adviser Class*. . . . . . . . . . . . 1.00 1.00 1.00 1.00 1.00 --
Market Class* . . . . . . . . . . . . 1.00 1.00 1.00 -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Total Return++
Capital Class . . . . . . . . . . . . 1.71% 3.61% 3.44% 3.70% 3.19% 2.00%
Liquidity Class . . . . . . . . . . . 1.63% 3.43% 3.29% 3.52% 3.09% 1.90%
Adviser Class*. . . . . . . . . . . . 1.58% 3.34% 3.19% 3.43% 2.02% --
Market Class* . . . . . . . . . . . . 1.52% 3.24% 3.06% -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets/supplemental
data:
Net assets, end of year (000s)
Capital Class. . . . . . . . . . . $ 117,664 $74,251 $59,701 $48,482 $32,353 $35,698
Liquidity Class. . . . . . . . . . 66,738 53,074 54,677 6,734 2,591 13,805
Adviser Class* . . . . . . . . . . 49,969 29,936 7,296 55,511 64,123 --
Market Class*. . . . . . . . . . . 140,999 92,000 78,300 -- -- --
Ratio of operating expenses to average
net assets
Capital Class. . . . . . . . . . . 0.20%+ 0.20%** 0.35% 0.20% 0.23% 0.45%
Liquidity Class. . . . . . . . . . 0.35%+ 0.35%** 0.35% 0.35% 0.33% 0.55%
Adviser Class* . . . . . . . . . . 0.45%+ 0.45%** 0.45% 0.45% 0.48%+ --
Market Class*. . . . . . . . . . . 0.57%+ 0.55%** 0.35%+ -- -- --
Ratio of net investment income to average
net assets
Capital Class. . . . . . . . . . . 3.34%+ 3.53% 3.38% 3.61% 3.36% 1.98%
Liquidity Class. . . . . . . . . . 3.19%+ 3.38% 3.23% 3.46% 3.26% 1.86%
Adviser Class* . . . . . . . . . . 3.09%+ 3.28% 3.13% 3.36% 3.11%+ --
Market Class*. . . . . . . . . . . 2.97%+ 3.18% 3.03%+ -- -- --
Ratio of operating expenses to average
net assets without waivers
Capital Class. . . . . . . . . . . 0.46%+ 0.48% 0.52% 0.58% 0.59% 0.58%
Liquidity Class. . . . . . . . . . 1.31%+ 1.33% 0.67% 0.73% 0.69% 0.67%
Adviser Class* . . . . . . . . . . 0.71%+ 0.73% 0.77% 0.83% 0.84%+ --
Market Class*. . . . . . . . . . . 0.91%+ 0.93% 0.87%+ -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* The commencement dates of the Classes of Shares of the Portfolios
were as follows:
Nations Municipal Reserves Adviser Class - September 22, 1994.
Nations Municipal Reserves Market Class - May 3, 1996.
** The effect of interest expense on the operating expense ratio was
0.02%
+ Annualized.
++ Total return represents aggregate total return for periods indicated.
SEE NOTES TO FINANCIAL STATEMENTS.
41
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS NATIONS INSTITUTIONAL RESERVES
For a Share outstanding in each class of Money Market Reserves throughout each
period.
PERIOD
ENDED PERIOD YEAR YEAR YEAR YEAR
10/31/98** ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 5/15/98*** 11/30/97 11/30/96 11/30/95 11/30/94
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, beginning of period
Capital Class*. . . . . . . . . . . . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Liquidity Class . . . . . . . . . . . 1.00 -- -- -- -- --
Adviser Class . . . . . . . . . . . . 1.00 -- -- -- -- --
Market Class. . . . . . . . . . . . . 1.00 -- -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
Net investment income
Capital Class*. . . . . . . . . . . . 0.0249 0.0252 0.0545 0.0516 0.0561 0.0377
Liquidity Class . . . . . . . . . . . 0.0122 -- -- -- -- --
Adviser Class . . . . . . . . . . . . 0.0171 -- -- -- -- --
Market Class. . . . . . . . . . . . . 0.0029 -- -- -- -- --
Dividends from net investment income
Capital Class*. . . . . . . . . . . . (0.0249) (0.0252) (0.0545) (0.0516) (0.0561) (0.0377)
Liquidity Class . . . . . . . . . . . (0.0122) -- -- -- -- --
Adviser Class . . . . . . . . . . . . (0.0171) -- -- -- -- --
Market Class. . . . . . . . . . . . . (0.0029) -- -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, end of period
Capital Class*. . . . . . . . . . . . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Liquidity Class . . . . . . . . . . . 1.00 -- -- -- -- --
Adviser Class . . . . . . . . . . . . 1.00 -- -- -- -- --
Market Class. . . . . . . . . . . . . 1.00 -- -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total Return++
Capital Class*. . . . . . . . . . . . 2.73% 2.55% 5.58% 5.29% 5.76% 3.83%
Liquidity Class . . . . . . . . . . . 1.20% -- -- -- -- --
Adviser Class . . . . . . . . . . . . 1.72% -- -- -- -- --
Market Class. . . . . . . . . . . . . 0.29% -- -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets/
supplemental data:
Net assets, end of year (000s)
Capital Class* . . . . . . . . . . $190,743 $118,880 $177,908 $133,044 $131,089 $131,758
Liquidity Class. . . . . . . . . . 607 -- -- -- -- --
Adviser Class. . . . . . . . . . . 3,233 -- -- -- -- --
Market Class . . . . . . . . . . . 934,993 -- -- -- -- --
Ratio of operating expenses to average
net assets
Capital Class* . . . . . . . . . . 0.20%(a) 0.20%(a) 0.20% 0.35% 0.40% 0.40%
Liquidity Class. . . . . . . . . . 0.35%(a) -- -- -- -- --
Adviser Class. . . . . . . . . . . 0.45%(a) -- -- -- -- --
Market Class . . . . . . . . . . . 0.65%(a) -- -- -- -- --
Ratio of net investment income to average
net assets
Capital Class* . . . . . . . . . . 5.21%(a) 5.54%(a) 5.45% 5.16% 5.60% 3.80%
Liquidity Class. . . . . . . . . . 5.06%(a) -- -- -- -- --
Adviser Class. . . . . . . . . . . 4.96%(a) -- -- -- -- --
Market Class . . . . . . . . . . . 4.76%(a) -- -- -- -- --
Ratio of operating expenses to average
net assets without waivers
Capital Class* . . . . . . . . . . 0.44%(a) 0.27%(a) 0.28% 0.35% 0.46% 0.44%
Liquidity Class. . . . . . . . . . 1.29%(a) -- -- -- -- --
Adviser Class. . . . . . . . . . . 0.69%(a) -- -- -- -- --
Market Class . . . . . . . . . . . 0.89%(a) -- -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* The financial information for the fiscal periods through May 15, 1998
reflect the financial information for the Emerald Prime Advantage
Institutional Fund, which was reorganized into Capital Class shares as
of May 16, 1998.
** Money Market Reserve Liquidity Class, Adviser Class and Market Class
commenced operations on August 7, 1998, July 2, 1998 and October 9,
1998, respectively.
*** For the period from December 1, 1997 through May 15, 1998.
++ Total return represents aggregate total return for the periods
indicated.
(a) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
42
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NATIONS INSTITUTIONAL RESERVES
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. At October 31, 1998, the Trust offered five portfolios:
Nations Cash Reserves, Nations Treasury Reserves, Nations Government Reserves,
Nations Municipal Reserves and Nations Money Market Reserves (individually, a
"Portfolio", and collectively, the "Portfolios"). The Portfolios currently offer
four classes of shares: Capital Class Shares, Liquidity Class Shares, Adviser
Class Shares and Market Class Shares. Each class of shares of a Portfolio has
identical voting rights, except shareholders of a class have exclusive voting
rights on matters that relate solely to that class.
1. SIGNIFICANT ACCOUNTING POLICIES
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 -- Securities 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 market value of the
instrument is not significant. Restricted securities and certain other
assets are valued by the investment advisor under the supervision of the
Board of Trustees.
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. The Portfolio's investment advisor and sub-advisor, acting under
the supervision of the Board of Trustees, monitor 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 may enter into reverse repurchase
agreements with institutions that the Portfolios' investment advisor and
sub-advisor have determined are credit worthy. Under the terms of a typical
reverse repurchase agreement, a 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 establishes a
segregated account with its custodian bank in which it will maintain cash,
U.S. Government securities or other appropriate liquid securities 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.
43
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NATIONS INSTITUTIONAL RESERVES
At October 31, 1998, the Nations Treasury Reserves had reverse repurchase
agreements outstanding as follows:
<TABLE>
<CAPTION>
<S> <C>
Maturity Amount . . . . . . . . . . . . . . . . $ 277,113,000
Maturity Date . . . . . . . . . . . . . . . . . 11/02/98
Market Value of Assets Sold Under Agreements. . $ 270,000,000
</TABLE>
The average daily balance of reverse repurchase agreements outstanding by
Nations Treasury Reserves during the six months ended October 31, 1998 was
$196,966,000. Nations Cash Reserves and Nations Government Reserves did not
enter into any reverse repurchase agreements during the six months ended
October 31, 1998.
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, 1998, representing
the difference between interest rates on the reverse repurchase and
repurchase agreements, amounted to $135,000 and 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 accretion of discounts and amortization of premiums
calculated ratably, 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 its classes based upon the relative 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 the
capital gains were earned or more frequently to maintain a net asset value
of $1.00 per share, unless offset by any available capital loss
carryforward. 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.
FEDERAL INCOME TAX -- Each Portfolio intends to continue 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 provision is made for Federal income or
excise taxes.
EXPENSES -- General expenses of the Trust are allocated to the relevant
Portfolios based upon relative net assets. Operating expenses directly
attributable to a Portfolio or class of shares are charged to such
Portfolio's or class's 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 net assets of each class of shares.
CASH FLOW INFORMATION -- Cash, as used in the Statement of Cash Flows, is
the amount reported in the Statement of Net Assets and represents 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.
44
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NATIONS INSTITUTIONAL RESERVES
2. INVESTMENT ADVISORY FEE, SUB-ADVISORY FEE, ADMINISTRATION FEE AND RELATED
PARTY TRANSACTIONS.
The Trust has, on behalf of its Portfolios, entered into an investment advisory
agreement with NationsBanc Advisors, Inc. ("NBAI"), a wholly-owned subsidiary of
NationsBank, N.A. ("NationsBank"), pursuant to which NBAI provides investment
advisory services to the Portfolios and is entitled to receive a fee which is
calculated daily and paid monthly equal to 0.30%, on an annualized basis, of the
average daily net assets of each Portfolio.
The Trust has, on behalf of its Portfolios, entered into a sub-advisory
agreement with NBAI and TradeStreet Investment Associates, Inc. ("TradeStreet"),
a wholly-owned subsidiary of NationsBank, pursuant to which TradeStreet is
entitled to receive a sub-advisory fee from NBAI at the annual rate of 0.033% of
each Portfolio's average daily net assets.
Stephens Inc. ("Stephens") serves as the administrator of the Trust. First Data
Investor Services Group, Inc. ("First Data"), a wholly-owned subsidiary of First
Data Corporation, serves as the co-administrator of the Trust. Stephens and
First Data are entitled to receive a combined fee, computed daily and paid
monthly, at the annual rate of 0.10% of the average daily net assets of the
investment portfolios of the Trust. For the six months ended October 31, 1998,
Stephens earned $478,000, net of waivers, from the Portfolios for its
administration services.
The investment advisor, sub-advisor and administrator may, from time to time,
reduce their fees payable by each Portfolio. For the six months ended October
31, 1998, the fees waived were as follows:
<TABLE>
<CAPTION>
FEES WAIVED BY FEES WAIVED BY
INVESTMENT ADVISOR ADMINISTRATOR
------------------ -------------
<S> <C> <C>
Nations Cash Reserves. . . . . . . . . . . $ 4,521,000 $2,926,000
Nations Treasury Reserves. . . . . . . . . 1,248,000 829,000
Nations Government Reserves. . . . . . . . 412,000 250,000
Nations Municipal Reserves . . . . . . . . 264,000 136,000
Nations Money Market Reserves. . . . . . . 202,000 115,000
</TABLE>
NationsBank of Texas, N.A. ("NationsBank of Texas"), served as the custodian for
the Trust's assets until it merged with NationsBank on May 6, 1998. NationsBank
began serving as custodian for the Trusts' assets on that date and provided the
same services as were previously provided by NationsBank of Texas. For the six
months ended October 31, 1998, NationsBank of Texas and NationsBank earned less
than $500 and $14,000 respectively, for providing such services.
Prior to October 19, 1998, The Bank of New York ("BNY"), pursuant to an
agreement with each of the Portfolios and NationsBank, served as sub-custodian
for the Portfolios. Effective October 19, 1998, BNY began serving as the
custodian for the Trusts' assets and is providing the same services as were
previously provided by NationsBank. There is no longer a sub-custodian for the
Trust.
First Data also serves as the transfer agent for the Portfolios' shares.
NationsBank of Texas served as the sub-transfer agent for the Capital Class
Shares of the Portfolios until it merged with NationsBank on May 6, 1998.
NationsBank began serving as sub-transfer agent for the Capital Class Shares of
the Portfolios on that date and provides the same services as were previously
provided by NationsBank of Texas. For the six months ended October 31, 1998,
NationsBank of Texas and NationsBank earned less than $500 and $11,000
respectively, for providing such services. Stephens also served as distributor
of the Portfolios' shares.
45
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NATIONS INSTITUTIONAL RESERVES
The Trust pays each unaffiliated 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 each unaffiliated
Trustee in attending such meetings.
The Trust's 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 participants 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 and retirement plans is included in the
"Trustees' fees and expenses" line of the Statements of Operations.
Certain other affiliated Nations Funds, advised by NBAI, have made daily
investments of cash balances in Nations Cash Reserves, pursuant to an exemptive
order received from the Securities and Exchange Commission. At October 31, 1998,
approximately 3.0% of the net assets of the Nations Cash Reserves was held by
other affiliated Nations Funds.
On September 30, 1998, NationsBank Corporation, the parent of NationsBank,
merged with BankAmerica Corporation.
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. 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.
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, respectively, 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.
46
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NATIONS INSTITUTIONAL RESERVES
For the six months ended October 31, 1998, 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 ADVISER MARKET
CLASS CLASS MARKET CLASS
SHARES SHARES CLASS SHARES
SERVICING SERVICING SHARES SERVICING
PORTFOLIO PLAN PLAN PLAN PLAN
----------------------------- -------- --------- ------- ---------
<S> <C> <C> <C> <C>
Nations Cash Reserves 0.15% 0.25% 0.20%* 0.25%
Nations Treasury Reserves 0.15% 0.25% 0.20%* 0.25%
Nations Government Reserves 0.15% 0.25% 0.20%* 0.25%
Nations Municipal Reserves 0.15% 0.25% 0.20%* 0.25%
Nations Money Market Reserves 0.15% 0.25% 0.20%* 0.25%
</TABLE>
A substantial portion of the fees paid pursuant to the plans described above are
paid to NationsBank and its affiliates.
* Reflects an increase in the Market Class Shares Plan from 0.10%, effective
October 1, 1998.
4. SHARES OF BENEFICIAL INTEREST.
At October 31, 1998, an unlimited number of shares of beneficial interest
without par value were authorized for the Trust. The Trust's Declaration of
Trust authorizes the Board of Trustees to classify or reclassify any shares
authorized, but not issued, 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
(amounts in thousands):
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, 1998 APRIL 30, 1998
---------------- --------------
<S> <C> <C>
NATIONS CASH RESERVES:
Capital Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 17,646,112 $ 27,029,346
Issued as reinvestment of dividends . . . . . . . . . . 36,407 64,512
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (16,925,213) (25,726,549)
------------ ------------
Net increase/(decrease) . . . . . . . . . . . . . . . . $ 757,306 $ 1,367,309
------------ ------------
Liquidity Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,974,485 $ 8,183,907
Issued as reinvestment of dividends . . . . . . . . . . 22,391 18,291
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (4,804,421) (7,514,186)
------------ ------------
Net increase/(decrease) . . . . . . . . . . . . . . . . $ 192,455 $ 688,012
------------ ------------
Adviser Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,086,577 $ 3,993,186
Issued as reinvestment of dividends . . . . . . . . . . 17,553 20,314
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (1,965,927) (3,588,638)
------------ ------------
Net increase/(decrease) . . . . . . . . . . . . . . . . $ 138,203 $ 424,862
------------ ------------
Market Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,085,500 $ 1,504,300
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (572,000) (1,187,800)
------------ ------------
Net increase/(decrease) . . . . . . . . . . . . . . . . $ 513,500 $ 316,500
------------ ------------
Total Increase/(decrease) . . . . . . . . . . . . . . $ 1,601,464 $ 2,796,683
------------ ------------
------------ ------------
</TABLE>
47
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NATIONS INSTITUTIONAL RESERVES
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, 1998 APRIL 30, 1998
---------------- --------------
<S> <C> <C>
NATIONS TREASURY RESERVES:
Capital Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,266,570 $ 1,816,628
Issued in exchange for net assets of
Emerald Treasury Advantage Fund (Note 9). . . . . . 144,375 --
Issued as reinvestment of dividends . . . . . . . . . . 4,941 4,525
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (1,195,066) (2,044,082)
----------- -----------
Net increase/(decrease) . . . . . . . . . . . . . . . $ 220,820 $ (222,929)
----------- -----------
Liquidity Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,434,366 $ 2,905,975
Issued as reinvestment of dividends . . . . . . . . . . 2,703 10,849
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (1,886,182) (2,254,978)
----------- -----------
Net increase/(decrease) . . . . . . . . . . . . . . . . $ (449,113) $ 661,846
----------- -----------
Adviser Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,501,972 $ 2,542,456
Issued as reinvestment of dividends . . . . . . . . . . 2,916 9,722
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (1,381,953) (2,483,674)
----------- -----------
Net increase/(decrease) . . . . . . . . . . . . . . . . $ 122,935 $ 68,504
----------- -----------
Market Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,240,800 $ 903,800
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (395,300) (761,700)
Net increase/(decrease) . . . . . . . . . . . . . . . . $ 845,500 $ 142,100
----------- -----------
Total Increase/(decrease) . . . . . . . . . . . . . . $ 740,142 $ 649,521
----------- -----------
----------- -----------
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, 1998 APRIL 30, 1998
---------------- --------------
<S> <C> <C>
NATIONS GOVERNMENT RESERVES:
Capital Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 661,191 1,207,038
Issued as reinvestment of dividends . . . . . . . . . . 3,501 6,640
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (694,999) (1,148,448)
---------- -----------
Net increase/(decrease) . . . . . . . . . . . . . . . . $ (30,307) $ 65,230
---------- -----------
Liquidity Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 262,693 $ 655,655
Issued as reinvestment of dividends . . . . . . . . . . 817 1,718
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (253,564) (631,082)
---------- -----------
Net increase/(decrease) . . . . . . . . . . . . . . . . $ 9,946 $ 26,291
---------- -----------
Adviser Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 335,526 $ 392,891
Issued as reinvestment of dividends . . . . . . . . . . 1,765 1,934
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (291,686) (349,506)
---------- -----------
Net increase/(decrease) . . . . . . . . . . . . . . . . $ 45,605 $ 45,319
---------- -----------
</TABLE>
48
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NATIONS INSTITUTIONAL RESERVES
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, 1998 APRIL 30, 1998
---------------- --------------
<S> <C> <C>
NATIONS GOVERNMENT RESERVES (CONTINUED):
Market Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . $ 312,300 $ 799,150
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . (259,800) (743,150)
---------- ----------
Net increase/(decrease) . . . . . . . . . . . . . . . . $ 52,500 $ 56,000
---------- ----------
Total Increase/(decrease) . . . . . . . . . . . . . . $ 77,744 $ 192,840
---------- ----------
---------- ----------
SIX MONTHS ENDED YEAR ENDED
OCTOBER 31, 1998 APRIL 30, 1998
---------------- --------------
NATIONS MUNICIPAL RESERVES:
Capital Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . . $ 160,565 $ 344,665
Issued as reinvestment of dividends . . . . . . . . . . . 193 195
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . . (117,345) (330,310)
---------- ----------
Net increase/(decrease) . . . . . . . . . . . . . . . . . $ 43,413 $ 14,550
---------- ----------
Liquidity Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . . $ 178,931 $ 702,167
Issued as reinvestment of dividends . . . . . . . . . . . 393 1,606
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . . (165,660) (705,376)
---------- ----------
Net increase/(decrease) . . . . . . . . . . . . . . . . . $ 13,664 $ (1,603)
---------- ----------
Adviser Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . . $ 166,807 $ 275,459
Issued as reinvestment of dividends . . . . . . . . . . . 288 875
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . . (147,061) (253,694)
---------- ----------
Net increase/(decrease) . . . . . . . . . . . . . . . . . $ 20,034 $ 22,640
---------- ----------
Market Class Shares:
Sold. . . . . . . . . . . . . . . . . . . . . . . . . . . $ 160,070 $ 326,000
Redeemed. . . . . . . . . . . . . . . . . . . . . . . . . (111,070) (312,300)
Net increase/(decrease) . . . . . . . . . . . . . . . . . $ 49,000 $ 13,700
Total Increase/(decrease) . . . . . . . . . . . . . . . $ 126,111 $ 49,287
---------- ----------
---------- ----------
</TABLE>
<TABLE>
<CAPTION>
PERIOD ENDED PERIOD ENDED YEAR ENDED
OCTOBER 31, 1998 MAY 15, 1998* NOVEMBER 30, 1997*
---------------- ------------- ------------------
<S> <C> <C> <C>
NATIONS MONEY MARKET RESERVES:
Capital Class Shares:
Sold . . . . . . . . . . . . . . . . . . . . . . . . . . $ 467,039 $ 188,673 $ 386,649
Issued as reinvestment of dividends. . . . . . . . . . . 252 -- --
Redeemed . . . . . . . . . . . . . . . . . . . . . . . . (395,436) (247,701) (341,785)
----------- ---------- ----------
Net ncrease/(decrease). . . . . . . . . . . . . . . . . $ 71,855 $ (59,028) $ 44,864
----------- ---------- ----------
Liquidity Class Shares:
Sold . . . . . . . . . . . . . . . . . . . . . . . . . . $ 8,201 $ -- $ --
Issued as reinvestment of dividends. . . . . . . . . . . 12 -- --
Redeemed . . . . . . . . . . . . . . . . . . . . . . . . (7,606) -- --
----------- ---------- ----------
Net increase/(decrease). . . . . . . . . . . . . . . . . $ 607 $ -- $ --
----------- ---------- ----------
</TABLE>
49
<PAGE>
<TABLE>
<CAPTION>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NATIONS INSTITUTIONAL RESERVES
PERIOD ENDED PERIOD ENDED YEAR ENDED
OCTOBER 31, 1998 MAY 15, 1998* NOVEMBER 30, 1997*
---------------- ------------- ------------------
<S> <C> <C> <C>
NATIONS MONEY MARKET RESERVES (CONTINUED):
Adviser Class Shares:
Sold . . . . . . . . . . . . . . . . . . . . . . . . . . $ 61,737 $ -- $ --
Issued as reinvestment of dividends. . . . . . . . . . . -- -- --
Redeemed . . . . . . . . . . . . . . . . . . . . . . . . (58,504) -- --
------------ ------------- ------------
Net increase/(decrease). . . . . . . . . . . . . . . . . $ 3,233 $ -- $ --
------------ ------------- ------------
Market Class Shares:
Sold . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,200,000 $ -- $
Issued as reinvestment of dividends. . . . . . . . . . . -- -- --
Redeemed . . . . . . . . . . . . . . . . . . . . . . . . (265,000) -- --
------------ ------------- ------------
Net increase/(decrease). . . . . . . . . . . . . . . . . $ 935,000 $ -- $ --
------------ ------------- ------------
Total Increase/(decrease). . . . . . . . . . . . . . . $ 1,010,695 $ (59,028) $ 44,864
------------ ------------- ------------
------------ ------------- ------------
</TABLE>
* Reflects financial information for the Emerald Prime Advantage Institutional
Fund, which was reorganized into Nations Money Market Reserves on May 22,
1998.
5. RESTRICTED SECURITIES
The following securities of Nations Cash Reserves are illiquid and
restricted as to the resale and, accordingly, are valued at fair market value in
good faith by or under the direction of the Trust's Board of Trustees taking
into consideration such factors as the Board deems appropriate.
The following table summarizes illiquid restricted securities outstanding
at October 31, 1998.
<TABLE>
<CAPTION>
ACQUISITION PAR VALUE FAIR PERCENTAGE COST AT
SECURITY DATE VALUE PER UNIT VALUE OF NET ASSETS 10/31/98
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Commonwealth Life
Insurance Co.
5.530% 11/02/98+ 02/05/98 $75,000,000 $ 1.00 $ 75,000,000 1.1% $ 75,000,000
Jackson National Life
Insurance Co.
5.650% 04/29/99# 01/02/98 50,000,000 1.00 50,000,000 0.7 50,000,000
Jackson National Life
Insurance Co.
5.410% 01/01/99+ 12/14/97 50,000,000 1.00 50,000,000 0.7 50,000,000
Peoples Security Life
Insurance Co.
5.450% 04/29/99# 05/09/98 25,000,000 1.00 25,000,000 0.4 25,000,000
Travelers Insurance
Company
5.645% 01/14/99+ 07/31/98 50,000,000 1.00 50,000,000 0.7 50,000,000
Travelers Insurance
Company
5.368% 11/02/98+ 10/14/98 50,000,000 1.00 50,000,000 0.7 50,000,000
- -----------------------------------------------------------------------------------------------------------------------------
$ 300,000,000 4.3% $ 300,000,000
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
# Put Date
+ Reset Date
Certain securities are subject to legal restrictions that may make them
difficult to sell. No Portfolio will invest in more than 10% of the value
of its assets in such illiquid securities.
50
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NATIONS INSTITUTIONAL RESERVES
The following security of Nations Cash Reserves is restricted as to resale:
however, at October 31, 1998, this security was considered liquid due to its
put feature, which allows the Portfolio to put the security back to the
issuer upon seven calendar days notice.
<TABLE>
<CAPTION>
ACQUISITION PAR VALUE FAIR PERCENTAGE COST AT
SECURITY DATE VALUE PER UNIT VALUE OF NET ASSETS 10/31/98
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
New York Life
Insurance Co.
5.292% 11/07/98# 11/17/97 $ 100,000,000 $ 1.00 $ 100,000,000 1.4% $ 100,000,000
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
# Put Date
6. LINE OF CREDIT
The Trust participates in an uncommitted line of credit provided by BNY under a
line of credit agreement dated July 10, 1998 (the "Agreement"). Advances under
the Agreement may be made primarily for temporary or emergency purposes,
including the meeting of redemption requests that otherwise might require the
untimely disposition of securities. Interest on borrowings is payable at the
Federal funds rate plus 0.50% on an annualized basis. The Agreement requires,
among other things, that each participating Portfolio maintain a ratio of no
less than 4 to 1 net assets (not including funds borrowed pursuant to the
Agreement) to aggregate amount of indebtedness pursuant to the Agreement.
For the six months ended October 31, 1998, there were no borrowings by the
Portfolios under the Agreement.
7. CAPITAL LOSS CARRYFORWARD.
At October 31, 1998 , the Portfolios had available for Federal income tax
purposes the following unused capital losses expiring April 30 of the following
years:
<TABLE>
<CAPTION>
2002 2003 2004 2005
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Nations Treasury Reserves $ 9,000 $ 3,000 -- $ 15,000
Nations Government Reserves -- -- $ 0* --
Nations Municipal Reserves -- 1,000 -- --
</TABLE>
* Represents less than $500.
8. PRINCIPAL SHAREHOLDERS
At October 31, 1998, there were no shareholders in any Portfolio holding more
than 10% of shares outstanding of that portfolio.
51
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NATIONS INSTITUTIONAL RESERVES
9. REORGANIZATIONS
On May 15, 1998, Treasury Reserves (the "Acquiring Portfolio") acquired the
assets and liabilities of the Emerald Treasury Advantage Fund (the "Acquired
Fund") in a tax-free reorganization in exchange for shares of the Acquiring
Fund, pursuant to an agreement and plan of reorganization approved by the
Acquired Fund's shareholders. The value of shares issued by the Acquiring
Portfolio is presented in note 4. The total net assets, as of the reorganization
date, of the Acquired Fund and Acquiring Portfolio prior to Acquisition, and the
Acquiring Portfolio after acquisition were $144,375,000, $1,630,778,000, and
$1,775,153,000, respectively.
On May 22, 1998, Money Market Reserves, a newly established Portfolio, acquired
the assets and certain liabilities of the Emerald Prime Advantage Institutional
Fund, pursuant to a plan of reorganization approved by its shareholders. The
acquisition was accomplished by a tax-free exchange of shares of Money Market
Reserves in an amount equal to the value of the outstanding shares of the
Emerald Prime Advantage Institutional Fund. The financial statements of Money
Market Reserves reflect the historical financial results of the Emerald Prime
Advantage Institutional Fund prior to the reorganization. Additionally, the
fiscal year-end of the Emerald Prime Advantange Institutional Fund for reporting
purposes was changed to coincide with that of the Trust.
10. SUBSEQUENT EVENT
On November 5, 1998, the Board of Trustees approved changes in the Portfolios'
administration arrangements whereby NBAI and Stephens will each serve as
co-administrators for the Portfolios and BNY will serve as sub-administrator.
52
