Deutsche Asset Management
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Mutual Fund
Semi-Annual Report
June 30, 2000
Institutional
Treasury Assets
Formerly Institutional Treasury Assets Fund, a BT Mutual Fund
A Member of the
Deutsche Bank Group
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<PAGE>
Treasury Assets Institutional
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TABLE OF CONTENTS
LETTER TO SHAREHOLDERS ................................ 3
TREASURY ASSETS INSTITUTIONAL
Schedule of Investments ............................ 6
Statement of Assets and Liabilities ................ 8
Statement of Operations ............................ 9
Statements of Changes in Net Assets ................ 10
Financial Highlights ............................... 11
Notes to Financial Statements ...................... 12
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The Fund is not insured by the FDIC and is not a
deposit, obligation of or guaranteed by Deutsche
Bank. The Fund is subject to investment risks,
including possible loss of principal amount
invested.
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2
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Treasury Assets Institutional
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LETTER TO SHAREHOLDERS
We are pleased to present you with this semi-annual report for Treasury Assets
Institutional (the "Fund"), providing a detailed review of the market, the
portfolio, and our outlook. Included are a complete financial summary of the
Fund's operations and a listing of the portfolio's holdings.
With the acquisition of Bankers Trust by Deutsche Bank, the name of your Fund
has changed to Treasury Assets Institutional. However, the Fund's investment
objectives, policies and strategies, as well as its portfolio manager, remain
the same.
MARKET ACTIVITY
Concerns over Y2K proved to be unfounded as the new century rolled in without a
glitch. Thus, the major factors impacting the money markets over the first half
of 2000 were the ongoing strength of the U.S. economy and the interest rate
increases by the Federal Reserve Board in response to such strength. These
factors combined to push yields on short-term money market securities
significantly higher.
THE U.S. ECONOMY CONTINUED TO EXPAND OVER THE SEMI-ANNUAL PERIOD, CAUSING ALARM
AMONG THE FINANCIAL MARKETS THAT INFLATION MAY BE IMMINENT AND THAT THE FEDERAL
RESERVE BOARD MAY CONTINUE ITS TIGHTENING CYCLE.
o Existing home sales in the U.S. soared through the first half of 2000, as did
durable goods orders and retail sales.
o At the same time, productivity improvements and competitive pressures held
prices steady. Both the Consumer Price Index and Producer Price Index
reflected these steady prices, providing a glimmer of hope to the financial
markets that perhaps the Federal Reserve Board would remain on the sidelines.
o Nominal GDP, however, continued to surge, pushing the year-over-year growth
rate to 7%. These numbers put the financial markets on notice that the Fed was
probably not done raising interest rates.
IN FACT, THE FEDERAL RESERVE BOARD FOLLOWED UP ITS 0.75% RATE INCREASE IN 1999
WITH THREE ADDITIONAL INTEREST RATE HIKES, TOTALING ANOTHER 1.00%, IN THE FIRST
HALF OF 2000 -- ON FEBRUARY 2, MARCH 21, AND MAY 16.
o The Federal Reserve Board continued to take a hard stance against inflation
and argued that labor force growth and productivity could not indefinitely
support the pace of the economy.
STATUS AT JUNE 30, 2000
Average maturity: 35 days
Net assets: $579 million
<TABLE>
<CAPTION>
INVESTMENT REVIEW
CUMULATIVE TOTAL AVERAGE ANNUAL
RETURNS TOTAL RETURNS ANNUALIZED
7 day 7 day
Periods ended Past 6 Past 1 Since Past 1 Since current effective
June 30, 2000 months year inception year inception yield yield
<S> <C> <C> <C> <C> <C> <C> <C>
Treasury Assets Institutional 1
(inception 12/1/97) 2.92% 5.58% 14.39% 5.58% 5.35% 6.34% 6.54%
----------------------------------------------------------------------------------------------------------------
iMoneyNet Institutional
Government Money Funds
Average 2 2.76% 5.25% 13.58%* 5.25% 5.05%* 5.93% 6.11%
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<FN>
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1 PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. Yields and total return
will fluctuate. Yields quoted for money market funds most closely reflect the
fund's current earnings. "Current yield" refers to the income generated by an
investment in the Fund over a 7-day period. This income is then "annualized".
The "effective yield" is calculated similarly but, when annualized, the income
earned by an investment in the Fund is assumed to be reinvested.The "effective
yield" will be slightly higher than the "current yield" because of the
compounding effect of this assumed reinvestment.
Performance figures assume the reinvestment of dividends. During the period
the Fund waived certain fees and expenses. Had these fees and expenses not
been waived, the Fund's return would have been lower. An investment in the
Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation
or any other government agency. Although the Fund seeks to preserve the value
of your investment at $1.00 per share, it is possible to lose money by
investing in the Fund.
2 The iMoneyNet, Inc. Money Fund Report Averages, a service of iMoneyNet, Inc.
(formerly the IBC Financial Data, Inc.) are averages for categories of similar
money market funds.
* Benchmark returns are for the period beginning November 30, 1997.
</FN>
</TABLE>
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Treasury Assets Institutional
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LETTER TO SHAREHOLDERS
PORTFOLIO DIVERSIFICATION
By Asset Type as of June 30, 2000 (percentages are based on net assets)
U.S. Treasury Notes 11%
U.S. Government and Agency Obligations 19%
Floating Rate Notes 5%
Repurchase Agreements 65%
o The Federal Reserve Board raised interest rates by 0.25% in February and
March, but stronger economic numbers in April led policymakers to believe that
inflation was accelerating and the economy not slowing, prompting a 0.50%
increase in May.
o Following its June meeting, the Federal Reserve Board explained that the
slowing of domestic demand was the reason for its holding the federal funds
rate steady that month, but it reiterated the point that core inflation was
rising. Thus, the Fed warned such a neutral stance, based on signs of the
economy cooling, was "tentative and preliminary."
o On June 30, 2000, the targeted federal funds rate stood at 6.50%.
ALTHOUGH MONEY MARKET YIELDS IN GENERAL ROSE SUBSTANTIALLY DURING THE SIX MONTH
PERIOD, A STRONG TECHNICAL CONDITION KEPT TREASURY YIELDS FROM RISING IN TANDEM
WITH THE OTHER MARKETS.
o There were three major reasons contributing to Treasuries being an expensive
market during this period. These were:
-- investors' decisions to remain on the sidelines to avoid volatile equity
and bond markets while the Federal Reserve Board continued to raise
interest rates
-- the government's cutback in overall issuance of Treasuries, and
-- the U.S. Treasury's buyback program of 30-year issues with budget surplus
monies.
o The combination of these factors led to greater demand and less supply.
We were able to produce competitive yields during the six month period in
Treasury Assets Institutional. Once Y2K liquidity issues were behind us, we were
able to once again focus on the economy and normal, technical factors. Thus, our
strategy during the first half of the year was to maintain a somewhat shorter
than average duration, taking advantage of the higher yields offered by
repurchase agreements, federal agencies, and cash management bills when
opportunities presented themselves.
MANAGER OUTLOOK
Looking ahead to the second half of the year, we expect that the "soft landing"
scenario -- slower economic growth without inflation -- should play out.
Economic indicators announced late in the semi-annual period were a little
weaker than those reported in prior months, including a weaker National
Purchasing Manager's report and a cooler labor market, as reported in weekly
jobless claims. We feel that these weaker numbers will enable the Federal
Reserve Board to stay on hold for a couple of months, although we are not
convinced that the Federal Reserve Board has completed its cycle of interest
rate increases.
The larger question for the Federal Reserve Board may be whether or not this
slowdown is temporary or if it is a longer lasting downturn. One key indicator
to monitor will be oil prices, as the current higher prices are noticeably
diminishing consumer purchasing power and slowing demand in the economy. A
moderation of energy prices would reduce these pressures.
In Treasury Assets Institutional, we intend to continue to concentrate on
repurchase agreements, since the yields have often been substantially higher
than short-term Treasury securities. We will likely manage the Fund with a
neutral position, while we continue to assess economic data for further signs of
the direction of the economy.
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Treasury Assets Institutional
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LETTER TO SHAREHOLDERS
We will, of course, continue to closely observe economic conditions and how they
affect the financial markets, as we seek to provide high current income
consistent with liquidity and capital preservation.
We appreciate your support of Treasury Assets Institutional and look forward to
continuing to serve your investment needs for many years ahead.
/S/ SIGNATURE DARLENE M. RASEL
Darlene M. Rasel
Portfolio Manager of TREASURY ASSETS INSTITUTIONAL
June 30, 2000
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5
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Treasury Assets Institutional
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SCHEDULE OF INVESTMENTS June 30, 2000 (Unaudited)
PRINCIPAL
AMOUNT SECURITY VALUE
FLOATING RATE NOTES -- 5.4%
Federal Home Loan Bank,
Daily Variable Rate,
$ 7,140,000 4.65%, 10/20/00 .................................. $ 7,105,837
-----------
Federal Home Loan Bank,
Monthly Variable Rate:
10,000,000 6.465%, 7/12/00 .................................. 9,999,877
4,000,000 6.35%, 2/2/01 .................................... 3,997,521
-----------
13,997,398
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Federal National Mortgage Association,
Daily Variable Rate,
10,000,000 6.83%, 7/17/00 ................................... 9,999,809
-----------
TOTAL FLOATING RATE NOTES
(Amortized Cost $31,103,044) ................................. 31,103,044
-----------
AGENCY OBLIGATIONS -- 19.2%
Federal Home Loan Mortgage Corporation
30,000,000 6.57%, 7/3/00 .................................... 30,000,000
20,000,000 6.42%, 8/3/00 .................................... 19,889,433
8,000,000 6.425%, 8/15/00 .................................. 7,938,606
10,000,000 6.46%, 8/31/00 ................................... 9,894,128
-----------
67,722,167
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Federal National Mortgage Association
10,000,000 5.935%, 8/3/00 ................................... 9,948,893
19,042,000 6.49%, 9/21/00 ................................... 18,767,372
7,000,000 6.55%, 11/1/00 ................................... 6,845,893
8,000,000 6.515%, 12/7/00 .................................. 7,772,699
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43,334,857
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TOTAL AGENCY OBLIGATIONS
(Amortized Cost $111,057,024) ................................ 111,057,024
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U.S. TREASURY NOTES -- 11.0%
9,000,000 6.125%, 7/31/00 .................................. 9,001,193
15,000,000 4.00%, 10/31/00 .................................. 14,894,382
10,000,000 5.75%, 10/31/00 .................................. 9,982,887
30,000,000 4.625%, 11/30/00 ................................. 29,808,673
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63,687,135
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TOTAL U.S. TREASURY NOTES
(Amortized Cost $63,687,135) ................................. 63,687,135
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See Notes to Financial Statements.
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6
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Treasury Assets Institutional
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SCHEDULE OF INVESTMENTS June 30, 2000 (Unaudited)
PRINCIPAL
AMOUNT SECURITY VALUE
REPURCHASE AGREEMENTS -- 64.7%
$20,000,000 Banque Paribas, 6.32%, 7/5/00 (dated 6/20/00,
collaterized by $130,965, U.S. Treasury
Strip, 5.75%, due 10/31/02, market value
$133,584 and $ 20,061,987, U.S. Treasury
Bond, 7.50% to 8.00%, due 11/15/18
to11/15/21, market value $20,295,093 and
$14,036, Federal Mortagage Acceptance Corp.,
6.791%, due 1/1/28, market value $14,239) ....... $ 20,000,000
20,000,000 Chase Manhattan, 6.50%, 7/5/00 (dated 6/29/00,
collaterized by $20,402,507, U.S. Treasury
Note, 5.875%, due 11/15/04, market value
$20,241,750) .................................... 20,000,000
20,000,000 Credit Suisse First Boston, 6.39%, 8/7/00 (dated 6/7/00,
collateralized by U.S. Treasury Strip 1,
6.075% to 6.625%, due from 11/15/26 to
8/15/27, market value $20,678,809) .............. 20,000,000
25,000,000 Credit Suisse First Boston, 6.55%,
7/3/00 (dated 6/30/00, collaterized by
$12,979,133, U.S. Treasury Note, 7.75%, due
2/15/01, market value $12,616,748 and,
$52,903, Federal National Mortgage
Association Strip 1, 6.93%, due 2/15/08,
market value $52,903 and $12,698,331, U.S.
Treasury Strip 1, 5.75% to 6.125%, due from
10/31/00 to 2/15/29, market value $12,698,331) .. 25,000,000
39,588,203 Goldman Sachs and Co., 6.50%, 7/3/00
(dated 6/30/00, collaterized by $39,588,437,
U.S. Treasury Note, 5.50%, due 5/15/09,
market value $40,091,855) ....................... 39,588,203
20,000,000 Greenwich Capital, Inc., 6.60%, 7/3/00
(dated 6/30/00, collaterized by $20,401,274,
U.S. Resolution Funding Strip 1, 6.33% to
6.64%, due from 7/15/00 to 1/15/30, market
value $20,401,274), ............................. 20,000,000
20,000,000 J.P. Morgan Inc., 6.40%, 7/3/00 (dated 6/29/00,
collateralized by $20,000,287, U.S. Treasury
Note, 6.625%, due 1/30/02, market value
$20,179,331) .................................... 20,000,000
20,000,000 Merrill Lynch and Co., 6.53%, 8/7/00 (dated 6/6/00,
collaterized by $3,134,170, Federal Home
Loan Bank, 8.508%, due 8/11/17, market value
$3,134,170 and $7,891,840, Federal Home Loan
Mortgage Corp., 8.153%, due 1/26/18, market
value $7,891,840 and $9,374,114, Federal
National Mortgage Association, 5.90% to
8.51%, due 2/11/04 to 6/22/18, market value
$9,222,379) ..................................... 20,000,000
20,000,000 Morgan Stanley Dean Witter and Co., 6.39%, 8/7/00
(dated 6/7/00, collaterized by $20,102,108,
U.S. Treasury Note, 6.25%, due 10/31/01,
market value $20,293,219) ....................... 20,000,000
20,000,000 Salomon Smith Barney, 6.32%, 7/5/00 (dated 6/20/00,
collaterized by $20,000,243, U.S. Treasury
Note, 6.375%, due 6/30/02, market value
$20,400,400) .................................... 20,000,000
18,000,000 Swiss Bank Corp., 6.45%, 9/12/00 (dated 6/13/00,
collaterized by $18,364,899, U.S. Treasury
Inflation Index Bond, 3.625%, due 7/15/02,
market value $18,062,724) ....................... 18,000,000
50,000,000 UBS Warburg LLC., 6.55%, 7/3/00 (dated 6/30/00,
collaterized by 51,004,014, U.S. Treasury
Inflation Index Bond, 3.625%, due 7/15/02,
market value $50,164,797) ....................... 50,000,000
82,044,108 West Deutsche Landesbank Girozentrale, 6.55%, 7/3/00
(dated 6/30/00, collaterized by $82,088,890,
U.S. Treasury Bond, 7.50%, due 11/15/24,
market value $82,044,108) ....................... 82,044,108
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TOTAL REPURCHASE AGREEMENTS
(Amortized Cost $374,632,311) ................................ 374,632,311
===========
TOTAL INVESTMENTS
(Amortized Cost $580,479,514) ....................... 100.3% 580,479,514
LIABILITIES IN EXCESS OF OTHER ASSETS .................. (0.3) (1,548,151)
----- -------------
NET ASSETS ............................................. 100.0% $578,931,363
===== ============
See Notes to Financial Statements.
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7
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Treasury Assets Institutional
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STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
JUNE 30, 2000
ASSETS
Investment at Value (Amortized Cost $580,479,514) ......... $ 580,479,514
Cash ...................................................... 31,900
Interest Receivable ....................................... 1,501,212
Prepaid Expenses and Other ................................ 10,980
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Total Assets ................................................. 582,023,606
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LIABILITIES
Dividends Payable ......................................... 3,010,842
Due to Bankers Trust ...................................... 68,416
Accrued Expenses and Other ................................ 12,985
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Total Liabilities ............................................ 3,092,243
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NET ASSETS ................................................... $ 578,931,363
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COMPOSITION OF NET ASSETS
Paid-in Capital ........................................... $ 578,940,336
Distributions in Excess of Income ......................... (4,341)
Accumulated Net Realized Loss from Investment
Transactions ........................................... (4,632)
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NET ASSETS ................................................... $ 578,931,363
=============
SHARES OUTSTANDING ($0.001 par value per share,
unlimited number of shares
of beneficial interest authorized) ........................ 578,933,851
=============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
(net assets divided by shares outstanding) ................ $ 1.00
=============
See Notes to Financial Statements.
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Treasury Assets Institutional
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STATEMENT OF OPERATIONS (Unaudited)
FOR THE SIX
MONTHS ENDED
JUNE 30, 2000
INVESTMENT INCOME
Interest Income ......................................... $ 19,120,129
------------
EXPENSES
Advisory Fees ........................................... 496,954
Administration and Services Fees ........................ 331,696
Professional Fees ....................................... 12,102
Trustees Fees ........................................... 2,773
Miscellaneous ........................................... 615
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Total Expenses ............................................. 844,140
Less: Fee Waivers and/or Expense Reimbursements ............ (329,978)
------------
Net Expenses ............................................... 514,162
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NET INVESTMENT INCOME ...................................... 18,605,967
NET REALIZED GAIN ON INVESTMENT TRANSACTIONS ............... 1,102
------------
NET INCREASE IN NET ASSETS FROM OPERATIONS ................. $ 18,607,069
============
See Notes to Financial Statements.
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Treasury Assets Institutional
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STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX FOR THE
MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
2000 1 1999
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS
Net Investment Income ............................ $ 18,605,967 $ 31,599,525
Net Realized Gain (Loss) from Investments ........ 1,102 (4,014)
--------------- ---------------
Net Increase in Net Assets from Operations .......... 18,607,069 31,595,511
--------------- ---------------
DISTRIBUTIONS TO SHAREHOLDERS
Net Investment Income ............................ (18,605,967) (31,599,525)
--------------- ---------------
CAPITAL TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
(at net asset value of $1.00 per share)2
Proceeds from Sales of Shares .................... 1,463,078,189 3,152,772,659
Cost of Shares Redeemed .......................... (1,523,014,368) (3,002,127,706)
--------------- ---------------
Net Increase (Decrease) from Capital Transactions in
Shares of Beneficial Interest .................... (59,936,179) 150,644,953
--------------- ---------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ............. (59,935,077) 150,640,939
NET ASSETS
Beginning of Period .............................. 638,866,440 488,225,501
--------------- ---------------
End of Period .................................... $ 578,931,363 $ 638,866,440
=============== ===============
<FN>
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1 Unaudited.
2 As of June 30, 2000 and December 31,1999, one shareholder held 8% and 7% of
the Fund's outstanding shares, respectively.
</FN>
</TABLE>
See Notes to Financial Statements.
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Treasury Assets Institutional
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FINANCIAL HIGHLIGHTS
Contained below are selected data for a share of beneficial interest
outstanding, total investment return, ratios to average net assets and other
supplemental data for each of the periods indicated for Treasury Assets
Institutional.
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEARS FOR THE PERIOD
MONTHS ENDED ENDED JUNE 30, DEC. 1, 1997 2 TO
JUNE 30, 2000 1 1999 1998 DEC. 31, 1997
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
NET ASSET VALUE, BEGINNING OF PERIOD ......... $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------ -------
INCOME FROMINVESTMENT OPERATIONS
Net Investment Income ..................... 0.03 0.05 0.05 0.0046
Net Realized Gain from Investment
Transactions ............................ 0.00 3 0.00 3 0.00 3 0.00 3
------ ------ ------ -------
Total from Investment Operations ............. 0.03 0.05 0.05 0.0046
------ ------ ------ -------
DISTRIBUTIONS TO SHAREHOLDERS
Net Investment Income ..................... (0.03) (0.05) (0.05) (0.0046)
------ ------ ------ -------
NET ASSET VALUE, END OF PERIOD ............... $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== =======
TOTAL INVESTMENT RETURN ...................... 2.92% 4.97% 5.33% 0.46%
SUPPLEMENTAL DATA AND RATIOS:
Net Assets, End of Period
(000s omitted) .......................... $578,931 $638,866 $488,226 $ 94,386
Ratios to Average Net Assets:
Net Investment Income ..................... 5.86%4 4.86% 5.24% 5.43%4
Expenses After Waivers .................... 0.16%4 0.16% 0.16% 0.16%4
Expenses Before Waivers ................... 0.26%4 0.26% 0.27% 0.97%4
<FN>
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1 Unaudited.
2 The Fund's inception date.
3 Less than $0.01 per share.
4 Annualized.
</FN>
</TABLE>
See Notes to Financial Statements.
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Treasury Assets Institutional
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NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1 -- ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
A. ORGANIZATION
BT Institutional Funds (the "Trust") is registered under the Investment Company
Act of 1940 (the "Act"), as amended, as an open-end management investment
company. The Trust was organized on March 26, 1990, as an unincorporated
business trust under the laws of the Commonwealth of Massachusetts. Treasury
Assets Institutional (the "Fund") is offered to "accredited investors" as
defined under the Securities Act of 1933. The Fund began operations and offering
shares of beneficial interest on December 1, 1997. The Declaration of Trust
permits the Board of Trustees (the "Trustees") to issue shares of beneficial
interest in the Fund. The following summarizes the significant accounting
policies of the Fund:
B. VALUATION OF SECURITIES
Investments are valued at amortized cost in accordance with Rule 2a-7 of the
Investment Company Act of 1940.
C. SECURITIES TRANSACTIONS AND INTEREST INCOME
Securities transactions are accounted for on a trade date basis. Interest income
is recorded on the accrual basis and includes amortization of premium and
accretion of discount on investments. Expenses are recorded as incurred.
Realized gains and losses from securities transactions are recorded on the basis
of identified cost.
D. DISTRIBUTIONS
It is the Fund's policy to declare dividends daily and pay them monthly to
shareholders from net investment income. Dividends payable to shareholders are
recorded by the Fund on the ex-dividend date. Distributions of net capital gains
earned by the Fund, if any, are made at least annually to the extent they exceed
capital loss carryforwards.
E. REPURCHASE AGREEMENTS
The Fund may enter into repurchase agreements with financial institutions deemed
to be creditworthy by the Fund's Investment Adviser, subject to the seller's
agreement to repurchase such securities at a mutually agreed upon price.
Securities purchased subject to repurchase agreements are deposited with the
Fund's custodian, and, pursuant to the terms of the repurchase agreement, must
have an aggregate market value greater than or equal to the repurchase price
plus accrued interest at all times. If the value of the underlying securities
falls below the value of the repurchase price plus accrued interest, the Fund
will require the seller to deposit additional collateral by the next business
day. If the request for additional collateral is not met, or the seller defaults
on its repurchase obligation, the Fund maintains the right to sell the
underlying securities at market value and may claim any resulting loss against
the seller. However, in the event of default or bankruptcy by the seller,
realization and/or retention of the collateral may be subject to legal
proceedings.
The Fund may enter into tri-party repurchase agreements with broker-dealers and
domestic banks. The third party, which is the broker's custodial bank, holds the
collateral in a separate account until the repurchase agreement matures. The
agreement ensures that the collateral's market value, including any accrued
interest, is adequate to cover the agreement if the broker defaults.
F. FEDERAL INCOME TAXES
It is the Fund's policy to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and distribute all of its
taxable income to shareholders. Therefore, no federal income tax provision is
required.
G. OTHER
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts in the financial statements.
Actual results could differ from those estimates.
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12
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Treasury Assets Institutional
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NOTES TOFINANCIAL STATEMENTS (Unaudited)
NOTE 2 -- FEES AND TRANSACTIONS WITH AFFILIATES
The Fund has entered into an Administration and Services Agreement with Bankers
Trust Company ("Bankers Trust"), an indirect wholly owned subsidiary of Deutsche
Bank AG. Under this agreement, Bankers Trust provides administrative, custody,
transfer agency and shareholder services to the Fund in return for a fee
computed daily and paid monthly at an annual rate of .10% of the Fund's average
daily net assets.
The Fund has entered into an Advisory Agreement with Bankers Trust. Under this
agreement, the Fund pays Bankers Trust a fee computed daily and paid monthly at
an annual rate of .15% of the Fund's average daily net assets.
Bankers Trust has contractually agreed to waive its fees and reimburse expenses
of the Fund through April 30, 2001, to the extent necessary, to limit all
expenses to .16% of the average daily net assets of the Fund.
At June 30, 2000, the Fund was a participant with other affiliated entities in a
revolving credit facility in the amount of $200,000,000, which expires April 27,
2001. A commitment fee on the average daily amount of the available commitment
is payable on a quarterly basis and apportioned among all participants based on
net assets. No amounts were drawn down or outstanding for this fund under the
credit facility for the six months ended June 30, 2000.
NOTE 3 -- CAPITAL LOSS CARRYFORWARDS
At June 30, 2000, capital loss carryforwards available as a reduction against
future net realized capital gains consisted of $538, which will expire in 2007.
NOTE 4 -- FUND NAME CHANGE
On April 30, 2000, the Fund changed its name from BT Institutional Treasury
Assets Fund to Treasury Assets Institutional.
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[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
For information on how to invest, shareholder account information and current
price and yield information, please contact your relationship manager or write
to us at:
DEUTSCHE ASSET MANAGEMENT SERVICE CENTER
P.O. BOX 219210
KANSAS CITY, MO 64121-9210
or call our toll-free number: 1-800-730-1313
This report must be preceded or accompanied by a current prospectus for the
Fund.
Deutsche Asset Management is the marketing name for the asset management
activities of Deutsche Bank AG, Deutsche Fund Management, Inc., Bankers Trust
Company, DB Alex. Brown LLC, Deutsche Asset Management, Inc. and Deutsche Asset
Management Investment Services Limited.
Treasury Assets Institutional CUSIP #055924815
1664SA (06/00)
Exclusive Placement Agent:
ICC Distributors, Inc.
