BAILARD, BIEHL & KAISER
INTERNATIONAL FUND GROUP, INC.
[GRAPHIC]
Bailard, Biehl & Kaiser International Equity Fund
A No Load Fund With No 12B-1 Plan
Annual Report
As of September 30, 1996
<PAGE>
November 29, 1996
Dear Shareholders:
We are pleased to present your September 30, 1996 annual shareholders' report
for the Bailard Biehl & Kaiser International Equity Fund. In this report, we
will review the Fund's performance over the past year, discuss the movements of
the world's stock markets and present our outlook for the future.
Performance Review
The Bailard Biehl & Kaiser International Equity Fund returned 2.02%* for the six
months ending September 30th and 7.33%* over the year ending September 30, 1996.
For comparison, the Morgan Stanley Europe Australia and Far East Index (EAFE)
returned 1.46% and 8.61% over the same respective time periods. The European
stock markets, which represented approximately 60% of the Funds investments
throughout the year, provided most of the higher returns. However, over the
year, the Fund achieved returns of more than 24% from its stock holdings in Hong
Kong. Japanese equities, which represented 20% to 25% of the Fund over the year,
performed well in local terms but were diminished by dollar strength. Successful
hedging by the Fund reduced the impact of the dollar's strength against the yen.
In the final quarter of 1995 and through the first six months of 1996, the
world's major stock markets generally moved higher. Although long-term interest
rates in the U.S. had moved up in March, world equity markets were gaining
strength. The economic recovery in Japan appeared to be underway. In continental
Europe, investors were looking forward to better economic growth and the
comforting fiscal framework of the Maastricht Treaty.
Then, in July, a sharp downdraft of selling, fanned by fears of higher interest
rates, sent U.S. stocks tumbling. The effects were also felt across virtually
all of the world's stock markets. However, once it became apparent that the U.S.
economy was likely to slow again in the final months of 1996, the U.S. stock
market and most international stock markets recovered their poise. By the end of
September, the net effect of this bumpy three month ride was that international
equity returns were flat.
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Looking back on the year as a whole, the returns from the world's stock markets
have been very mixed. In Europe, for example, the German, French and Swiss
markets all posted solid 13% to 15% gains in their major market indices. The
U.K. lagged slightly, rising only 11%. However, some of the smaller markets of
Europe, like Sweden and Spain, showed gains of 18% and 21% in their respective
market indices.
In the Far East, the leading market for the year to September was Hong Kong,
showing a rise of 23%. Investors in Hong Kong have become more sanguine about
the prospective impact of rule from mainland China in 1997. In contrast, doubts
about the outlook for its important electronics industry hurt the Singapore
stock market, which rose just 4% for the year. In Japan, the stock market ended
1995 with a strong showing which carried through the first few months of 1996.
However, in the last few months, the robustness of the economic recovery has
been called into question once again. As a result, the Japanese stock market has
made little forward progress since May. For the year ending September 1996, the
Japanese stock market returned 13% in local terms. Dollar strength against the
yen reduced this return to only 0.5% for U.S. investors.
The year to September 1996 was also mixed for the stock markets of emerging
countries. Thailand suffered from an overheated economy and the threat of
capital outflows. The result was a decline of 16%. In contrast, the Mexican
economy and stock market are rising slowly from the ashes of the peso crisis of
late 1994. According to the Barings Emerging Markets Index (BEMI), emerging
markets were up 1% for the past six months and 8% for the full year to September
30, 1996.
Over the six months to September, the dollar has been strong against the German
mark and particularly the yen. Between March 31 and September 30, 1996, the
dollar has gained 3.2% against the German mark and 4.1% against the yen. For the
full year to September, the dollar was up 6.7% versus the German mark and 11.4%
against the yen. The Fund successfully retained some of the gains from its
Japanese and European holdings, by hedging a portion of the yen and European
exposure from April through September.
Europe -- Market Outlook
Europe appears to be firmly on a path to faster economic growth. Germany, which
began 1996 in a mini-recession, has reported economic growth of over 5% for the
second quarter. France struggled in the second quarter, but some political
progress on fiscal policy has set the stage for better economic prospects in the
year ahead. In Italy, the economy has slowed drastically. However, investors are
encouraged by low inflation and the prospect of still lower interest rates
ahead. The U.K. economy has followed a course nearer to that of the U.S. than
continental Europe. Concerns that economic growth has been too strong have
prompted the Bank of England to raise short-term interest rates at the beginning
of November.
2
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Across continental Europe, two factors continue to look encouraging for
investors. First, there is considerable room for better economic growth in 1997.
French unemployment is running at over 12 %. German unemployment is just over
10%. In effect, there is considerable capacity to expand output without running
into higher inflation. Second, the determination of most of the governments of
Europe to meet the relatively stringent fiscal requirements of the Maastricht
agreement has meant fiscal prudency has been the rule. The governments of
Germany and France have fought considerable political battles over cuts in
government expenditure. The governments of Italy and Spain have also made
pledges of fiscal sobriety. Tight fiscal policies have created room for easier
money policy, and low interest rates have become the policy of choice for
stimulating economic growth. So long as inflation remains low, this is a
favorable environment for investors.
In 1997, therefore, we expect European corporate earnings to benefit from this
environment of improving economic growth, low inflation and relatively low
interest rates. In addition, European stock markets will be encouraged by more
corporate restructurings, deregulation and privatizations. Furthermore, given
that relative valuations look more attractive in Europe than in the U.S., the
stage is set for European equities to outperform U.S. stocks in the year ahead.
Japan -- Market Outlook
In the first quarter of 1996, economic activity in Japan spiked upwards, driven
largely by huge public works spending by the Japanese authorities. The Japanese
stock market, anticipating this as the turning point for the economic recovery,
rallied strongly until May. However, economic statistics released over the
summer have been sobering, and the true robustness of the Japanese economic
outlook has come into question again. With fiscal budget deficits at around 5%,
compared with 1.5% for the U.S., and short-term interest rates well below 1%,
compared with 3% in Germany and 5.5% in the U.S., the Japanese economy is out of
step with the world's major economies.
For the Japanese stock market to move ahead, investors need to see firmer signs
of economic growth, a return to more fiscal responsibility, stable low interest
rates and, most important, deregulation of the economy. Ultimately it is the
pace of change in Japan that will determine the scope for stock market gains.
By a number of important valuation measures such as book to price, the Japanese
market still looks relatively attractive. However, the pace of economic reform
in Japan is still moving slowly. As long as global volatility remains low, other
stock markets look more likely to outpace Japan in the year ahead.
3
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Far East -- Market Outlook
The past year has witnessed very disparate returns from the smaller stock
markets of the Far East. Hong Kong has been a leading performer and has remained
strong over recent months. The important Hong Kong property market is doing well
due to solid economic growth and renewed confidence about Chinese rule. Stable
and still relatively low U.S. interest rates have also helped to boost the
market. Like many Asian economies, Hong Kong has suffered from the cyclical
weakness affecting exports throughout the region. However, prospects still look
good for strong economic growth in 1997. We expect the stock market to continue
to perform relatively well.
The Singapore stock market has struggled in the past six months. A slowdown in
the electronics industry, which by some estimates represents half the
manufacturing sector of Singapore, and a clamp down on property speculation have
dampened investor enthusiasm. However, a slowdown in Singapore means growth in
the 5% to 6% region compared to the 10% and 9% economic growth of 1994 and 1995,
and the likelihood is that economic growth will recover in 1997. Malaysia, too,
is going through a relative slowdown after eight years of robust growth. Higher
interest rates have boosted the ringgit and eased investors fears about rising
trade deficits. The rising tide of competition in low-end production for the
electronics industry is bringing an enormous long-term challenge to both
Singapore and Malaysia. Although a brief period of readjustment is necessary for
these rapidly growing economies, the signs are that their respective stock
markets will be back on track in 1997.
Investment Strategy
Bailard, Biehl & Kaiser uses an investment approach driven by quantitative
models. We want to invest in those markets and stocks representing the best
relative value on the basis of fundamental measures such as book to price.
However, our research indicates investor anxiety is a key determinant of when
the pursuit of value will be most productive. In our models, we use global stock
market volatility as a proxy for investor anxiety. When volatility is high,
investor anxiety rises, creating more opportunities to enhance returns by
focusing on undervalued markets and securities. When volatility is low, as it
currently is, our research suggests markets that have been performing well will
continue to do so. Consequently, we are focusing our overweight positions in
Hong Kong, Holland and the smaller markets of Europe like Spain and Sweden. The
loss of market momentum and the uncertainties over future economic growth have
led us to slightly underweight the Japanese stock market.
At a more strategic level, the Equity Fund has targeted a 15% exposure to the
world's emerging markets. Over 10% of world market capitalization is represented
by emerging markets. Currently, 10% of the Bailard, Biehl & Kaiser International
Equity Fund is invested in these markets.
4
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We have made this strategic move for three reasons. First, most economists agree
that economies at an early stage of development have the potential to grow at
more rapid rates than mature economies. Over the longer term, as investors we
want to participate in that growth. Second, the spread of capitalism around the
world has encouraged emerging nations to develop their stock markets. The
development of a healthy stock market adds liquidity and distributes wealth in
an emerging nation. Thirdly, we gain diversification benefits through investing
in emerging markets.
For 1997, we expect slow economic growth in the U.S. and improving economic
growth in Japan, Europe and the Far East. As world trade expands, 1997 also
looks promising for many emerging markets. Overall, the global economic outlook
is encouraging, and your Fund is well positioned to benefit from this
environment.
We appreciate your continued investment in the Bailard, Biehl & Kaiser
International Equity Fund. If you have any questions concerning the Fund, please
do not hesitate to call us.
Sincerely,
/s/ Peter M. Hill /s/ Burnice E. Sparks, Jr.
Peter M. Hill Burnice E. Sparks, Jr.
Chairman President
* Average annual total returns for investment periods ended September 30,
1996: 3 months: 0.00%; 6 months: 2.02%; 12 months: 7.33%; 5 years: 3.17%
annualized; and 10 years: 2.18%, annualized. As required by the Securities
and Exchange Commission, these figures reflect the average compounded
return over the period indicated that would equate an initial amount
invested in shares of the Fund to the ending redeemable value of such
shares, assuming that all dividends and distributions by the Fund were
reinvested at net asset value. These figures also reflect the deduction of
an assumed 1% annual investment management fee (0.25% quarterly) payable by
clients of Bailard, Biehl & Kaiser through 9/30/93. As of 10/1/93, the Fund
charged a management fee of 0.95%. Actual fees varied during this period.
The performance data quoted represents past performance, and the investment
return and principal value of an investment in the Bailard, Biehl & Kaiser
International Equity Fund will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than their original cost.
5
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BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------ ----------
Equity Securities (96.58%)
I. Argentina (0.45%)
Argentina Banco de Galicia SA Class B ADR 1,300 $ 28,438
Astra Corp. Argentina 15,500 24,959
Banco Frances Del Rio Plata ADR 1,200 31,350
*Comercial Del Plata 10,900 26,382
Perez Companc SA Class B 11,600 73,440
Siderca 18,600 27,719
Telecom Argentina Stet France SA ADR 800 32,300
Telefonica de Argentina SA ADR Class B 2,700 67,163
Transportadora Gas Del Sur SA ADR 2,500 30,625
YPF SA ADR Class D 4,600 105,225
-----------
Total Argentina 447,601
-----------
II. Austria (0.17%)
OMV AG 900 90,483
VA Technologie AG (Bearer) 600 78,191
-----------
Total Austria 168,674
-----------
III. Australia (3.03%)
*Acacia Resources Ltd. 25,000 46,114
Australia & New Zealand Bank Group Ltd. 40,000 228,945
Brambles Inds Ltd. 8,500 137,945
Broken Hill Proprietary Ltd. 50,000 641,237
CRA Ltd. 16,900 254,199
CSR Ltd. 32,100 112,575
Coca-Cola Amatil Ltd. 6,000 78,848
Coles Myer Ltd. 12,500 45,421
Davids Ltd. 75,000 104,498
Fosters Brewing Group Ltd. 70,000 125,793
Goldfields Ltd. 20,000 35,624
Goodman Fielder Ltd. 75,000 76,592
Lend Lease Corp Ltd. 10,700 173,648
National Australia Bank Ltd. 22,000 232,333
QBE Insurance Group Ltd. 25,000 134,580
The News Corporation Ltd. 57,000 299,172
WMC Ltd. 20,000 128,722
Westpac Banking Corp. 25,000 129,435
Woolworth Ltd. 25,000 55,811
-----------
Total Australia 3,041,492
-----------
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------ ----------
IV. Belgium (0.49%)
Bekaert SA 50 $ 37,702
Fortis 800 112,501
Kredietbank 600 196,621
Petrofina SA 200 61,850
Powerfin SA 350 50,221
*Union Miniere 500 36,906
----------
Total Belgium 495,801
----------
V. Canada (4.28%)
Abitibi Price Inc. 5,500 70,813
Alcan Aluminum Ltd. 3,000 90,000
BC Gas Inc. 6,500 88,525
BC Telecom Inc. 6,000 120,040
Bank of Montreal 5,000 134,356
Bank of Nova Scotia 4,000 113,359
Barrick Gold Corporation 7,000 175,875
Bombardier Inc. Class B 11,000 156,676
Brascan Ltd. Class A 7,500 138,750
Cambior Inc. 6,000 83,250
Canadian Imperial Bank of Commerce 6,100 221,240
*Canadian Natural Resources 3,500 78,631
Canadian Utilities Ltd. Class A 3,000 62,333
Dofasco Inc. 3,500 53,834
Falconbridge Ltd. 2,500 50,200
IPL Energy 1,200 32,510
Imasco Ltd. 6,300 138,299
Imperial Oil Ltd. 5,000 212,500
Inco Ltd. 4,000 123,000
Ipsco Inc. 2,500 55,982
Loblaw Cos Ltd. 6,000 50,218
Magna Intl Class A 1,200 57,900
Molson Companies Ltd. Class A 5,300 76,851
*Newbridge Networks Corp. 2,500 159,375
Noranda Inc. 10,000 204,471
Northern Telecom Ltd. 3,400 196,350
Power Financial Corp 1,000 31,533
Quebecor Inc. Class B 5,000 74,887
*Renaissance Energy Ltd. 10,000 293,308
Royal Bank of Canada 8,900 253,530
Seagram Ltd. 7,000 261,625
Shell Canada Ltd. Class A 1,500 48,016
*TVX Gold Corp. 5,000 33,750
Telus Corp. 4,500 61,617
Thomson Corp. 6,000 107,926
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------ -----------
Canada - Continued
Transcanada Pipelines Ltd. 4,700 $ 75,788
*Wajax Ltd. 11,000 114,680
-----------
Total Canada 4,301,998
-----------
VI. China (0.10%)
Huaneng Power Intl ADR Series N 5,800 96,425
-----------
VII. France (6.56%)
Air Liquide (L) SA 1,925 298,132
Alcatel Alsthom CGE SA 3,000 252,928
Altran Technologies SA 100 27,916
Axa SA 2,700 161,723
Canal Plus 500 122,931
Carrefour Super Marche 1,475 827,805
Casino Guichard Perrachon 2,000 81,309
Credit Local de France (CLF) SA 4,000 340,722
De Dietrich 3,300 113,716
Ecco 1,500 359,501
Eramet 1,800 107,362
Eridania Beghin Say SA 1,580 243,783
Financiere De Paribas 2,000 128,545
Generale des Eaux 1,700 184,629
L'Oreal 600 203,272
Michelin "B" Regd 5,000 255,058
Peugeot SA 2,510 276,486
Rhone Poulenc SA Series A 3,000 83,632
Sagem 400 232,311
Saint Gobain 1,200 162,617
Sanofi 5,460 447,328
Seita 4,000 168,038
Soc. Nationale Elf Aquitaine 10,380 811,631
Societe Generale Paris 3,550 392,421
Technip SA 1,500 137,034
UAP Companie 8,000 161,533
-----------
Total France 6,582,363
-----------
VIII. Germany (7.67%)
BASF AG 13,500 424,403
Bankgesellschaft Berlin AG 15,000 299,637
Bayer AG 16,500 605,168
Bayeriache Motoren Werke AG 500 286,046
Berliner Kraft & Licht CL A 1,150 312,572
CKAG Colonia Konzern AG 10,100 777,254
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- --------------------------------------------------------------------------------
Shares Value
------- ----------
Germany - Continued
Commerzbank AG 1,600 $ 365,196
Degussa 560 202,639
Deutsche Bank AG 11,100 522,704
Fresenius AG Pfd. 1,000 184,694
Gehe AG 2,700 180,371
Hochtief AG 2,500 119,200
Hoechst AG 4,500 164,103
Industrie Werke Karlsruhe (IWKA) AG 450 100,177
Man AG 1,000 258,048
Mannesmann AG 1,200 449,553
Sap AG Pfd. 1,600 268,789
Siemens AG Bearer 18,300 964,350
Veba AG 12,800 669,823
Volkswagen AG 1,450 540,361
-----------
Total Germany 7,695,088
-----------
IX. Hong Kong (5.89%)
Cheung Kong Holdings Ltd. 70,000 538,601
Citic Pacific Ltd. 40,000 181,042
Dickson Concept Intl Ltd. 36,000 115,686
Electric & Eltek Intl Ltd. 14,000 39,620
Electric & Eltek Intl Holdings Ltd. 680,000 129,264
Goldlion Holdings Ltd. 70,000 59,744
*Guangshen Railway Co. Ltd. 258,000 99,256
HSBC Holdings Plc 30,000 556,705
Hang Seng Bank 20,000 212,078
Henderson Land Development Ltd. 65,000 556,867
Hong Kong & China Gas 99,600 169,370
*Hong Kong & China Gas Wts (Ex 9/30/97) 10,800 3,282
Hong Kong & Shanghai Hotels 81,000 146,121
Hong Kong Telecommunications 125,000 226,303
Hutchison Whampoa Ltd. 88,000 591,750
New World Development Co. Ltd. 100,000 526,316
*New World Infrastructure 64,400 152,401
*Peregrine Investment Wts (Ex 5/15/98) 4,500 844
Qingling Motor Companies Ltd. Class H 396,000 152,347
Shanghai Industrial Holdings Ltd. 85,000 195,105
Sinocan Holdings Ltd. 315,000 140,534
Sun Hung Kai Properties Ltd. 52,000 553,084
Swire Pacific Ltd. Class A 35,000 313,429
Tingyi Holding Corp. 454,000 95,696
Varitronix Intl 37,000 67,943
Zhenhai Refining & Chem Co. Ltd. Class H 330,000 89,616
-----------
Total Hong Kong 5,913,004
-----------
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------- ---------
X. Indonesia (0.49%)
*Bank Danamon Pt (Fgn Regd) 16,500 $ 12,075
Bank International Indonesia (Fgn Regd) 18,347 26,853
Citra Marga Nusaphale Persad 35,000 23,730
Gudang Garam (Fgn Regd) 12,000 45,200
Indah Kiat Pulp & Paper 62,240 47,153
Indosat ADR 1,500 49,500
*Lippo Bank (Fgn Regd) 7,000 10,999
Matahari Putra Prima (Fgn Regd) 16,000 17,391
Mayorah Indah (Fgn Regd) 51,000 21,406
Mulia Industrindo (Fgn Regd) 16,500 16,514
Sampoerna H.M. (Fgn Regd) 5,000 48,644
Semen Gresik (Fgn Regd) 17,000 50,495
Tambang Timah 5,500 9,352
Telekom Indonesia ADR Series B 3,300 102,713
*Wicaksana Overseas 7,000 8,739
----------
Total Indonesia 490,764
----------
XI. Ireland (0.81%)
Allied Irish Banks 32,500 191,304
CRH Plc 18,000 183,902
DCC Plc 2,500 10,826
Independent News Plc 4,999 25,898
Irish Life Plc 16,500 66,690
Irish Permanent Plc 3,500 25,261
Kerry Group A Shares 15,000 161,191
Smurfit (Jefferson) Plc 43,000 117,244
Waterford Wedgewood Units 20,000 25,823
----------
Total Ireland 808,139
----------
XII. Italy (3.49%)
Assicurazione Generali 6,600 140,404
Autostrade CEC Pfd. B Shares 55,000 93,892
Banca Popolare di Bergamo Credito 3,000 48,062
Banca Popolare di Milano 4,000 21,142
Benetton Group SpA 9,000 101,344
Bulgari SpA 800 14,891
Credito Italiano 42,900 49,265
Danieli & Co. 6,000 38,804
Danieli & Co. Di Risp 3,900 13,162
Edison SpA 11,000 68,541
ENI SpA 132,400 676,764
Fiat SpA 66,500 186,877
Fiat SpA di Risp 45,000 66,184
IFIL di Risp 9,100 13,772
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------- ----------
Italy - Continued
Istituto Mobiliare Italiano 44,800 $ 380,630
Istituto Nazionale delle Assicurazioni SpA (A) 264,200 382,501
Italgas 13,700 51,273
*Luxottica Group SpA ADR 1,100 80,025
*Olivetti & Co. SpA 77,000 28,211
Parmalat Finanziaria SpA 10,200 14,667
Pirelli SpA 79,900 145,580
R.A.S. 5,970 58,895
Tecnost SpA 5,800 11,044
Telecom Italia Mobile SpA 140,000 310,696
Telecom Italia SpA 40,000 88,902
Telecom Italia SpA di Risp 227,500 418,991
-----------
Total Italy 3,504,519
-----------
XIII. Japan (19.10%)
77th Bank 20,000 197,106
Advantest Corp. 10,000 408,547
Amada Co. Ltd. 20,000 184,563
Amway Japan Ltd. 6,000 260,180
Aoyama Trading 9,000 245,935
Atsugi Nylon Industrial 40,000 177,037
Autobacs Seven 3,000 264,212
Bridgstone Metalpha 35,000 410,787
Canon Inc. 22,000 431,662
Canon Sales Co. Inc. 500 13,573
Chubu Electric Power 30 634
Chugoku Bank 20,000 329,705
Chugoku Electric Power 15,000 315,818
Dai Ichi Kangyo Bank 32,000 538,996
Daiichi Pharmaceutical 5,000 78,842
Daikyo Inc. 40,000 269,139
Daiwa House Ind. Co. Ltd. 18,000 258,030
Dowa Fire & Marine 60,000 308,561
Fuji Bank Ltd. 28,000 546,880
Fuji Machine Manufacturing 15,000 383,013
Fuji Photo Film Co. 10,000 303,723
Fujita Corp. 28,000 117,153
Fukuda Corp. 12,000 105,362
Fukuda Denshi Ltd. 4,000 93,177
Hitachi Ltd. 115,000 1,112,754
Jaccs Co. Ltd. 14,000 118,031
Japan Tobacco Inc. 80 589,168
Kitz Corp. 12,000 56,121
*Kobe Steel 88,000 235,739
Komai Tekko 3,000 22,040
Kurita Water Industries 18,000 388,657
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------ -----------
Japan - Continued
Long Term Credit Bank of Japan 40,000 $ 287,775
Makita Corp. 10,000 146,038
Marubeni Corp. 70,000 363,750
Matsushita Electric Industrial Ltd. 25,000 418,851
Mitsubishi Corp. 9,000 114,501
Mitsubishi Estate 20,000 274,157
Mitsubishi Heavy Industries Ltd. 18,000 146,271
Mitsubishi Motors 70,000 590,154
Mitsubishi Oil Co. 26,000 198,002
New Oji Paper Co. Ltd. 17,000 128,701
Nippon Steel Corp. 95,000 294,494
Omron Corp. 10,000 187,251
Orix Corp. 2,000 77,051
Roland Corp. 15,000 262,062
Sankyo Co. Ltd. 11,000 404,068
Santen Pharmaceutical Co. 7,700 167,639
Sanwa Bank Ltd. 53,000 954,442
Sega Enterprises 3,000 130,359
Seino Transportation 30,000 427,362
Sekisui House Ltd. 50,000 546,522
Sumitomo Bank Ltd. 37,000 682,883
Sumitomo Electric 15,000 205,618
Sumitomo Trust & Banking Ltd. 12,000 150,517
Suzuki Motor Corp. 50,000 609,237
Tohoku Electric Power 13,000 281,862
Tokyo Electric Power 7,070 171,025
Tokyo Electron Ltd. 7,000 202,571
Tokyo Ohka Kogyo Co. Ltd. 13,000 329,615
Toyo Seikan Kaisha 2,000 65,403
Toyo Trust & Banking 44,000 402,096
Toyota Motor Corp. 2,000 51,068
Yakult Honsha Co. Ltd. 30,000 403,172
Yamaichi Securities Co. 66,000 405,053
Yamamura Glass Co. 47,000 248,443
Yamanouchi Pharmaceutical Co. Ltd. 4,000 84,576
------------
Total Japan 19,177,734
------------
XIV. Malaysia (2.22%)
*Arab Malaysian Finance 16,000 86,179
Commerce Asset Holdings Berhad (Fgn Regd) 15,000 93,361
DCB Holdings Berhad 25,000 85,780
Ekran Berhad 10,000 43,090
Fraser & Neave Holdings Berhad 10,000 47,877
Genting Berhad 9,000 65,353
Golden Hope Plantations Berhad 38,000 63,677
Hong Leong Inds Berhad 12,000 56,017
MBF Capital Berhad 37,000 52,553
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------ ----------
Malaysia - Continued
Magnum Corp. Berhad 22,000 $ 37,392
Malayan Banking Berhad 15,000 149,019
Malaysia Intl Shipping (Fgn Regd) 22,000 67,587
Malaysian Airline Systems 12,000 31,120
Malaysian Oxygen Berhad 10,000 48,675
New Straits Times 7,000 36,866
Nylex Malaysia Berhad 15,000 30,821
Perusahaan Otomobil Nasional Berhad 19,000 103,096
Petronas Gas Berhad 45,000 183,131
Public Bank Berhad (Fgn Regd) 20,000 37,025
Rashid Hussain Berhad 16,000 88,733
Resorts World Berhad 12,000 67,986
Sime Darby Berhad 60,000 198,691
Sime UEP Properties Berhad 10,000 24,537
Sungei Way Holdings 19,000 101,580
Telekom Malaysia 35,000 308,610
Tractors Malaysia 33,000 69,123
UMW Holdings Berhad 14,000 53,902
-----------
Total Malaysia 2,231,781
-----------
XV. Mexico (1.70%)
Alfa SA De Cv Class A 6,500 28,822
*Carso Global Telecom 19,000 49,795
Cemex ADR 25,200 206,325
*Cifra SA De Cv ADR 59,500 83,300
Coca Cola Femsa SA De Cv ADR 1,500 35,625
Comercial Mexicana SA De Cv 21,000 20,680
Desc SA De Cv ADR 1,500 33,375
*Empaques Ponderosa Ser B 10,800 33,594
Empressa La Moderna SA De Cv ADR 2,100 40,163
Femsa B SA De Cv Class B 23,000 70,020
Grupo Carso A1 SA De Cv 16,600 76,024
*Grupo Corvi SA De Cv Units 40,000 44,897
Grupo Elektra SA de Cv GDR 3,700 49,488
*,**Grupo Financiero Bancomer SA ADR 144A 7,000 67,375
Grupo Financiero Inbursa "Ser B" 7,000 27,333
Grupo Indl Durango SA De Cv ADR 4,100 48,688
Grupo Indl Maseca SA ADR 2,900 54,738
Grupo Modelo SA "Ser C" 6,600 33,895
*Grupo Televisa GDR 144A 3,100 89,513
Kimberly Clark de Mexico SA ADR 4,200 157,500
Nacional De Drogas SA De Cv L Shares 10,000 33,355
Telefonos de Mexico SA ADR 13,100 420,838
-----------
Total Mexico 1,705,343
-----------
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------ ----------
XVI. Netherlands (6.82%)
ABN-AMRO Holdings NV 14,600 $ 809,040
Aegon NV 3,500 172,693
D.S.M. NV 3,500 343,343
Fortis Amev NV CVA 6,000 179,379
Getronics NV 22,800 577,798
Heineken NV 1,700 310,206
Hoogovens NV CVA 1,800 64,429
IHC Caland NV 4,900 257,794
ING Groep NV 33,250 1,036,774
Koninklijke Ahold NV 2,800 158,428
Nutricia Ver Bedrijven 3,800 501,468
OCE - Van Der Grinten NV 2,500 272,835
Royal Dutch Petroleum 12,900 2,014,952
Van Ommeren NV CVA (Ptg Cert) 3,900 152,578
-----------
Total Netherlands 6,851,717
-----------
XVII. Norway (0.36%)
Awilco AS B 4,500 38,737
Christiania Bank OG Kreditkasse 6,500 16,686
Den Norske Bank AS 5,000 15,910
Elkem AS A 2,500 33,818
Leif Hoegh & Co 2,000 33,511
Norsk Hydro AS 3,500 163,826
Saga Petroleum AS Class A 2,500 40,351
*UNI Storebrand AS 4,500 24,280
-----------
Total Norway 367,119
-----------
XVIII. Philippines (0.44%)
Ayala Land Inc. Class B 43,650 53,242
Cosmos Botting Corp. 132,000 18,113
*DMCI Holdings Inc. 25,400 18,879
Davao Union Cement Corp. 24,400 8,929
Far East Bank & Trust 5,000 17,534
*Filinvest Development Corp. 66,000 25,157
*Filinvest Land Inc. 130,900 47,400
*Fortune Cement Corp. 30,900 16,195
Manila Electric Class B 2,210 16,342
Metropolitan Bank & Trust Co. 1,750 41,690
*Mondragon Intl Philippines Inc. 60,800 34,763
Petron Corp. 36,500 13,217
Philippine Long Distance Telephone 300 18,639
*Philippine National Bank 4,000 65,942
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------ ----------
Philippines - Continued
*Pilipino Telephone 13,500 $ 18,525
*Primetown Property Group 48,500 12,201
*Robinsons Land Corp. Class B 78,000 15,460
-----------
Total Philippines 442,228
-----------
XIX. Portugal (0.42%)
Banco Commercial Portugues (Fgn Regd) 7,500 90,593
Banco Totta & Acores (Fgn Regd) 5,000 87,388
Cimpor Cimentos De Portugal SA 1,400 29,447
Jeronimo Martins SA 300 27,289
Portugal Telecom ADR 4,500 115,875
Portucel Industrial Empresa SA 2,500 16,299
Sonae Investimentos 1,500 43,485
Tranquilidade Cia Seguros SA (Fgn Regd) 700 13,574
-----------
Total Portugal 423,950
-----------
XX. Singapore (1.30%)
ACMA Ltd. 30,000 71,581
City Developments 6,000 51,129
Clipsal Industries 15,000 43,500
Cycle & Carriage Ltd. 5,000 54,325
DBS Land (Fgn Regd) 32,000 105,894
Development Bank of Singapore (Fgn Regd) 10,000 122,852
GP Batteries Intl 15,000 43,350
Jardine Strategic 32,000 101,760
Keppel Corp. 10,000 77,404
Overseas Chinese Bank (Fgn Regd) 15,000 180,017
Prima Ltd. 12,000 42,608
Singapore Airlines Ltd. (Fgn Regd) 18,000 181,508
United Industrial Corp. 70,000 61,639
United Overseas Land 35,000 55,177
*United Overseas Land Wts (Ex 5/28/01) 10,000 7,101
Want Want Holdings 44,000 104,720
-----------
Total Singapore 1,304,565
-----------
XXI. South Korea (0.18%)
Daewoo Heavy Industries Ltd. 1,800 13,511
Kepco/ Korea Electric Power Corp. 2,939 97,136
Korea Long Term Credit Bank 1,700 40,096
Samsung Electronics 400 31,380
-----------
Total Korea 182,123
-----------
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------ ----------
XXII. Spain (2.68%)
*Argentaria (Fgn Regd) 9,000 $ 372,696
Aumar (Fgn Regd) 3,000 42,968
Autopistas Cesa (Fgn Regd) 8,925 106,639
Banco Bilbao Vizcaya 4,000 184,324
Banco Popular Esp. 300 55,111
Banco de Santander (Fgn Regd) 3,000 155,991
Bankinter Banco Interncontinental 700 80,642
Endesa 4,000 235,387
Fuerzas Electrica de Cataluna (FECSA) Series A 17,800 133,290
Iberdrola SA 30,000 290,731
Portland Valderrivas 400 24,348
Repsol SA ORD 8,000 262,787
Tabacalera SA Ser A (Fgn Regd) 1,000 42,656
Telefonica de Espana SA 25,000 464,119
Union Electrica Fenosa 32,000 198,522
Valle Hermoso SA 2,000 38,686
-----------
Total Spain 2,688,897
-----------
XXIII. Sweden (2.38%)
ABB AB Series A 2,200 232,983
AGA AB Series B 11,900 193,881
Astra AB Series A 9,500 401,278
Ericsson Telecom Series B 16,500 415,685
Investor AB Class B 5,100 193,881
Nordbanken 6,800 174,390
*Scania AB Wts (Ex 6/4/99) 5,100 5,386
Stora Kopparbergs Series A 15,700 203,686
Svedala Industri Free 3,800 65,924
Svenska Handelsbanken Series A 6,700 164,750
*Swedish Match AB Free 9,300 28,059
Sydkraft Series C 5,500 105,373
Volvo AB Class B Free 9,300 199,922
-----------
Total Sweden 2,385,198
-----------
XXIV. Switzerland (7.32%)
ABB AG Baden Bearer 100 122,221
Adecco SA 750 206,159
Alusuisse-Lonza Holding Ltd. 100 74,974
CS Holdings (Fgn Regd) 7,000 691,578
Ciba Geigy AG (Fgn Regd) 500 638,993
Clariant AG (Fgn Regd) 1,000 346,586
Danzas Holdings AG (Ptg Cert) 900 172,815
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
------- ----------
Switzerland - Continued
Nestle S.A. (Fgn Regd) 700 $ 779,699
Roche Holdings AG (Ptg Cert) 120 882,958
Sandoz AG (Fgn Regd) 1,550 1,859,852
Swiss Bank Corp. (Fgn Regd) 3,100 590,929
Swiss Reinsurance (Fgn Regd) 270 284,392
*Swissair (Fgn Regd) 100 82,145
Union Bank of Switzerland (Bearer) 300 288,503
Zellweger Luwa AG (Bearer) 150 105,768
Zurich Insurance (Fgn Regd) 800 221,178
-----------
Total Switzerland 7,348,750
-----------
XXV. Thailand (0.57%)
Advanced Info. Svcs (Fgn Regd) 5,700 77,999
Bangkok Bank (Fgn Regd) Pcl 15,600 203,657
Ptt Exploration and Production (Fgn Regd) Pcl 4,200 62,097
Shinawatra Comp & Comm Pcl (Fgn Regd) 3,000 51,669
Siam City Cement 2,700 18,474
Thai Airways International (Fgn Regd) Pcl 12,200 23,986
Thai Farmers Bank Pcl (Fgn Regd) 12,400 130,675
-----------
Total Thailand 568,557
-----------
XXVI. United Kingdom (17.66%)
Anglian Water Plc 26,000 218,744
Associated British Foods 50,000 320,094
BAA Plc 24,400 188,669
BAT Industries Plc 80,000 532,811
BTR Plc 60,000 254,040
Barclays Plc 105,800 1,555,016
Bardon Group Plc 390,000 210,604
Bass Plc 56,200 685,703
Brammer Plc 21,300 205,873
Britannic Assurance 20,000 214,752
*British Aerospace 36,200 598,635
*British Biotechnology Plc 218,750 719,037
British Gas Plc 86,600 270,424
British Petroleum Plc 100,000 1,037,761
British Steel Plc 90,000 278,928
British Telecom Plc 200,000 1,116,023
East Midland Electric Plc 20,000 162,943
Fine Art Developments Plc 30,000 224,926
GKN Plc 21,300 373,906
General Accident Plc 34,700 369,880
General Electric Plc 44,500 275,480
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY COUNTRY
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
Shares Value
---------- ------------
United Kingdom - Continued
Great Universal Stores Plc 25,000 $ 250,831
Hyder Plc Pfd 44,100 70,667
Imperial Chemical Industries Plc 30,400 402,081
Iceland Group Plc 140,000 192,839
Invesco Plc 40,000 148,073
Land Securities Plc 28,800 314,202
Lloyds Chemists Plc 40,000 315,241
Lloyds TSB Group Plc 174,989 1,035,348
London Clubs International 100,000 469,575
London Electric Plc 15,000 144,042
Lonrho Plc 51,100 136,373
Mirror Group Plc 190,000 645,353
National Westminister Bank Plc 20,000 212,561
Prudential Corp. Plc 30,000 211,074
Reuters Holdings Plc 60,000 693,562
Shell Transport & Trading 35,000 534,142
Smithkline Beecham Plc 54,464 665,375
Tate & Lyle 40,000 292,702
Unichem Plc 97,000 381,091
Yorkshire Electricity Group 37,000 432,619
Yorkshire Water Plc 8,000 79,202
Zeneca Plc 11,500 285,841
-------------
Total United Kingdom 17,727,043
-------------
Total Equity Securities
(Identified Cost $90,223,486) 96,950,873
-------------
Total Short-Term Investments (2.60%)
Brown Brothers Harriman & Co. (Grand Cayman Branch)
5.00% Call Account
(Identified Cost $2,609,000) $2,609,000 2,609,000
-------------
Total Investments (99.18%)
(Identified Cost $92,832,486) 99,559,873
Other Assets Less Liabilities (0.82%) 821,919
-------------
Net Assets (100.00%) $100,381,792
=============
__________________________________________________________
*This security is non-income producing.
**This security is exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers. On
September 30, 1996, these securities were valued at $67,375 or 0.07% of
Net Assets.
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS BY INDUSTRY
SEPTEMBER 30, 1996
UNAUDITED
- -------------------------------------------------------------------------------
Industry Percent of
- -------- Net Assets
----------
Aerospace 0.75%
Air Transportation 0.32
Appliances and Household Products 0.45
Automobile 3.51
Banking 17.06
Beverages and Tobacco 2.07
Broadcasting and Publishing 1.40
Building Materials & Components 0.98
Business and Public Services 3.11
Chemicals 3.89
Construction and Housing 1.51
Data Products 1.31
Electrical and Electronics 4.50
Electronic Components and Instruments 0.89
Energy Sources 7.60
Finance/Financial Services 2.20
Food and Housing Products 3.07
Gold 0.37
Health and Personal Care 7.04
Industrial Components 0.80
Insurance 3.98
Leisure 1.47
Machinery 3.56
Materials 0.61
Merchandising 2.86
Metals (Non-Ferrous) 1.03
Multi-Industry 3.28
Other Industries 0.18
Paper & Allied Products 0.63
Real Estate 3.69
Recreation 0.88
Railroad Transportation 0.43
Steel 1.09
Shipping 0.29
Telecommunications 4.07
Textiles 0.28
Utilities 4.75
Wholesale and International 0.70
Short-Term Investments 2.60
Assets Less Other Liabilities 0.82
------
Net Assets 100.00%
======
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
Assets
Investments, at value
(Identified cost $92,832,486) $ 99,559,873
Cash 270
Receivables:
Dividend, interest and recoverable foreign taxes receivable $ 447,141
Unrealized gain on forward currency contracts (Note 5) 145,729
Portfolio securities sold 662,139
Fund shares sold 25,737 1,280,746
-----------
Prepaid expenses 4,751
-------------
Total assets 100,845,640
-------------
Liabilities
Payable for portfolio securities purchased 172,794
Accrued management fees (Note 3) 77,221
Other accrued expenses 213,833
-------------
Total liabilities 463,848
-------------
Net assets (equivalent to $6.05 per share of $.0001 par value
capital stock, representing the offering and redemption
price for 16,581,606 shares outstanding,
100,000,000 shares authorized) $100,381,792
=============
Net assets consist of:
Capital paid in $ 85,962,975
Accumulated undistributed net investment income 692,870
Accumulated net realized gain on investments
and foreign currency transactions 6,851,262
Unrealized appreciation on:
Investments $6,727,387
Foreign currency 147,298 6,874,685
----------- -------------
$100,381,792
=============
</TABLE>
See "Notes to Financial Statements"
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
STATEMENT OF OPERATIONS
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
Investment Income
Dividends (net of foreign taxes withheld of $302,886) $2,240,449
Interest 161,543
-----------
2,401,992
Expenses
Advisory fees $988,625
Custodian fees 392,252
Audit and legal fees 90,015
Transfer agent fees 37,344
Administrative fees 33,179
Directors' fees and expenses 16,089
Insurance 7,186
Printing fees 5,045
Registration fees 7,406
Miscellaneous expenses 20,156
---------
Total expenses 1,597,297
-----------
Net investment income 804,695
-----------
Realized and Unrealized Gain (Loss)
on Investments and Foreign Currency
Net realized gain on investments 6,873,079
Net unrealized loss on investments (769,440)
-----------
Net gain on investments 6,103,639
-----------
Net realized gain on foreign currency 78,900
Net unrealized gain on foreign currency
and foreign currency denominated assets and
liabilities 123,385
-----------
Net gain on foreign currency 202,285
-----------
Net gain on investments and foreign currency 6,305,924
-----------
FOREIGN CURRENCY
Net increase in net assets resulting from operations $7,110,619
===========
</TABLE>
See "Notes to Financial Statements"
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
STATEMENT OF CHANGES IN NET ASSETS
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the year ended September 30,
-------------------------------
1996 1995
---- ----
<S> <C> <C>
Increase (Decrease) in Net Assets
Operations:
Net investment income $ 804,695 $ 1,119,886
Net realized gain on investments 6,873,079 5,460,318
Net unrealized loss on investments (769,440) (11,515,113)
Net realized gain (loss) on foreign currency 78,900 (213,691)
Net unrealized gain on foreign currency and
foreign currency denominated assets and liabilities 123,385 12,374
------------- -------------
Net increase (decrease) resulting from operations 7,110,619 (5,136,226)
------------- -------------
Distributions to shareholders:
From net investment income (1,061,398) --
From net realized gains (5,483,889) (3,077,445)
------------- -------------
Total distributions (6,545,287) (3,077,445)
------------- -------------
Fund share transactions:
Proceeds from shares sold 15,242,997 35,594,714
Net asset value of shares issued on
reinvestment of distributions 5,720,256 2,576,600
Cost of shares redeemed (29,356,526) (126,536,057)
------------- -------------
Net decrease resulting from Fund share
transactions (8,393,273) (88,364,743)
------------- -------------
Net decrease (7,827,941) (96,578,414)
Net Assets
Beginning of year 108,209,733 204,788,147
------------- -------------
End of year (including undistributed
net investment income of $692,870 and
$906,195, respectively) $ 100,381,792 $ 108,209,733
============= =============
Number of Fund Shares
Sold 2,576,621 6,030,952
Issued on reinvestment of distributions 999,560 448,885
Redeemed (5,035,947) (21,996,752)
------------- -------------
Net decrease (1,459,766) (15,516,915)
============= =============
</TABLE>
See "Notes to Financial Statements"
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
SEPTEMBER 30, 1996
- -------------------------------------------------------------------------------
For a share outstanding throughout the year:
<TABLE>
<CAPTION>
Year Ended September 30,(1)
------------------------------------------------------------------------------
1996 1995 1994 1993 1992
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year $ 6.00 $ 6.10 $ 5.66 $ 4.80 $ 5.69
------------- ------------- ------------- ------------- -------------
Income from Investment Operations:
Net Investment Income(2) 0.05 0.06(2) 0.01 0.07 0.06
Net Realized/Unrealized Gain (Loss) on
Securities and Foreign Currency 0.37 0.06(3) 0.43 0.79 (0.87)
------------- ------------- ------------- ------------- -------------
Total from Investment Operations 0.42 0.12 0.44 0.86 (0.81)
------------- ------------- ------------- ------------- -------------
Less Distributions:
Net Investment Income (0.06) -- -- -- (0.08)
Capital Gains (0.31) (0.22) -- -- --
------------- ------------- ------------- ------------- -------------
Total Distributions (0.37) (0.22) -- -- (0.08)
------------- ------------- ------------- ------------- -------------
Net Asset Value, End of Year $ 6.05 $ 6.00 $ 6.10 $ 5.66 $ 4.80
============= ============= ============= ============= =============
Total Return 7.33% 2.13% 7.77% 17.92% (14.20%)
Ratios/Supplemental Data:
Net Assets, End of Year (000's) $ 100,382 $ 108,210 $ 204,788 $ 182,894 $ 127,092
Ratio of Expenses to Average Net Assets 1.54% 1.53% 1.39% 0.68% 1.05%
Ratio of Net Investment Income to
Average Net Assets 0.78% 0.97% 0.29% 1.88% 1.55%
Portfolio Turnover Rate 103% 174% 176% 131% 77%
Average Commission Rate Paid(4) $ 0.0268 -- -- -- --
</TABLE>
_______________________________________________
1. Prior to February, 1993, the investment managers of the Fund were Nomura
Capital Management, Inc. and certain affiliates (collectively, "Nomura"),
Acadian Asset Management, Inc. ("Acadian"), and, with respect to foreign
currency hedging transactions and allocation of Fund assets to the other
managers, Bailard, Biehl & Kaiser, Inc. The Fund paid Nomura and Acadian fees at
varying rates for their services. Effective February, 1993, Bailard, Biehl &
Kaiser, Inc. (the "Advisor") assumed full responsibility for investment
management services to the Fund.
On October 1, 1993, the Fund and the Advisor entered into a new Investment
Management Agreement pursuant to which the Fund pays management fees to the
Advisor. At all times prior to that date, the Advisor directly charged
management fees to clients and the Fund paid no fees to the Advisor. If fees
directly charged to clients were included as a Fund expense at an assumed 1%
annual rate payable quarterly, pro-forma total returns were 16.74% and (15.05%)
(unaudited) for the years ended September 30, 1993 and 1992, respectively.
2. 1995 amounts are computed on the basis of average shares outstanding.
3. The amount shown for each share outstanding may not accord with the change
in the aggregate gains and losses in the portfolio securities for the period
because of the timing of purchases and redemptions of shares in relation to the
fluctuating market value of the portfolio.
4. Represents average commission rate paid per share on purchases and sales of
equity securities by the Fund, as computed under SEC rule effective with the
Fund's 1996 fiscal year. Prior year rates have not been presented as permitted
by the rule.
See "Notes to Financial Statements"
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
Note 1 - Summary of Significant Accounting Policies
Bailard, Biehl & Kaiser International Equity Fund (the "Fund") is a
non-diversified series of the Bailard, Biehl & Kaiser International Fund Group,
Inc. (the "Group"), a Maryland corporation and an open-end management investment
company registered under the Investment Company Act of 1940. The following
significant accounting policies are followed by the Fund in the preparation of
its financial statements and are in conformity with generally accepted
accounting principles for investment companies.
Security Valuation
Each listed investment security is valued at the closing price thereof reported
by the principal securities exchange on which the issue is traded, or if no sale
is reported, the mean of the closing bid and asked prices. Securities which are
traded over-the-counter are normally valued at the mean of the closing bid and
asked prices quoted by major dealers of such securities, or in the absence of
such prices, as determined in good faith by, or under procedures determined by,
the Board of Directors of the Fund. Short-term obligations with a maturity of 60
days or less are valued at amortized cost which approximates market.
The Fund's investment in foreign securities may entail risks due to the
potential of political and economic instability in the countries in which
securities are offered or the issuers conduct their operations. It is the Fund's
policy to continuously monitor its exposure to these risks.
Foreign Currency
Foreign currency amounts, other than the cost of investments, are translated
into U.S. dollar values at the mean of the bid and offer price of such currency
against U.S. dollars last quoted on the valuation date. The cost of investments
is translated at the rates of exchange prevailing on the dates the portfolio
securities were acquired.
The Fund includes foreign exchange gains and losses from dividends and interest
receivable and other foreign-currency denominated payables and receivables in
realized and unrealized gain (loss) on foreign currency. The Fund does not
isolate that portion of the results of operations resulting from changes in
foreign exchange rates on investments from fluctuations arising from changes in
the market price of securities for financial reporting purposes. Fluctuations in
foreign exchange rates on investments are included with net realized and
unrealized gain (loss) on investments.
Forward Foreign Currency Exchange Contracts
In connection with portfolio purchases and sales of securities denominated in a
foreign currency, the Fund may enter into forward foreign exchange contracts
("contracts"). Additionally, from time to time the Fund may enter into contracts
to sell foreign currencies to hedge certain foreign currency denominated assets.
All commitments are "marked-to-market" daily at the applicable translation rates
supplied by a quotation service and any resulting unrealized gains or losses are
included in unrealized appreciation (depreciation) on foreign currency
denominated assets and liabilities. The Fund records realized gains or losses at
the time the forward contract is settled. Risks may arise upon entering into
these contracts from the potential inability of counterparties to meet the terms
of their contracts and from unanticipated movements in the value of a foreign
currency relative to the U.S. dollar.
Federal Income Taxes
The Fund's policy is to comply with the requirements of the Internal Revenue
Code ("Code") applicable to regulated investment companies and to distribute all
of its taxable income to its shareholders. Therefore, no provision is made for
Federal income taxes.
For the fiscal year ended September 30, 1996, the Fund distributed to
shareholders $5,483,889 of long term capital gains.
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
NOTES TO FINANCIAL STATEMENTS(Continued)
- -------------------------------------------------------------------------------
Paid in capital, undistributed net investment income and undistributed realized
net gain have been adjusted for permanent book-tax differences.
Reclassifications between undistributed net investment income and undistributed
realized net gain arose principally from differing book and tax treatments for
foreign currency transactions.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Other
Investment security transactions are accounted for on the trade date. Dividend
income is recorded on the ex-dividend date or when the Fund first becomes aware
of such dividend. Interest income is recorded on the accrual basis.
Distributions to shareholders are recorded on the ex-dividend date. The Fund
uses the identified cost method for determining realized gain or loss on
investments. Certain expenses of the Group are allocated between the series of
the Group in such manner as the Directors deem appropriate.
Note 2 - Purchases and Sales of Securities
For the fiscal year ended September 30, 1996, purchases and sales of securities,
other than short-term investments, aggregated $103,910,541 and $117,464,007,
respectively. There were no purchases or sales of U.S. Government obligations.
Note 3 - Management Fee and Other Transactions with Affiliates
The Fund has entered into an Investment Management Agreement with Bailard, Biehl
& Kaiser, Inc. (the "Advisor") for investment advisory services, under which the
Advisor receives a fee, payable monthly, at the annual rate of 0.95% of the
average net assets of the Fund. Advisory fees paid on shares of the Fund are
taken into account in the computation of fees payable under individual advisory
agreements for advisory clients of the Advisor.
The Advisor has agreed to reimburse the Fund to the extent that the Fund's
operating expenses (as defined) exceed 2.5% of the first $30 million of the
average net assets of the Fund, 2.0% of the next $70 million, and 1.5% of the
remaining average net assets of the Fund.
Certain officers and directors of the Group are currently officers and directors
of the Advisor and receive compensation of $500 per year. Each other director is
compensated by the Group at the rate of $6,000 per year plus $1,000 for each
meeting of the Board of Directors attended and travel expenses incurred in
attending such meetings.
Note 4 - Tax Basis Appreciation
Unrealized appreciation (depreciation) at September 30, 1996, based on the cost
of securities for federal income tax purposes of $92,935,867, consists of:
Gross unrealized appreciation $ 9,395,198
Gross unrealized depreciation (2,771,192)
--------------
Net unrealized appreciation $ 6,624,006
==============
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
NOTES TO FINANCIAL STATEMENTS(Continued)
- -------------------------------------------------------------------------------
Note 5 - Forward Foreign Currency Contracts
At September 30, 1996 the Fund had entered into forward foreign currency
contracts which obligated the Fund to exchange currencies at specified future
dates. At the maturity of a forward contract, the Fund may either make delivery
of the foreign currency from currency held, if any, or from the proceeds of
portfolio securities sold, or it may terminate its obligation to deliver the
foreign currency at any time by purchasing an offsetting contract. The forward
value of amounts due to the Fund under the contracts, including contracts which
have been offset but remained unsettled, has been netted against the forward
value of the currency to be delivered by the Fund and the remaining amount is
shown as receivable (payable) for forward currency contracts in the financial
statements. Open forward foreign currency exchange contracts outstanding at
September 30, 1996 were as follows:
Currency Currency Delivery Unrealized
Receivable Deliverable Date Appreciation/(Depreciation)
- ---------- ----------- -------- ---------------------------
$2,000,000 (pound) 1,284,027 12/10/96 $ (8,889)
2,000,000 NLG 3,327,800 12/11/96 46,226
1,950,000 CHF 2,386,800 12/12/96 31,931
500,000 FIM 2,271,600 12/12/96 276
1,012,969 SEK 6,756,500 12/16/96 (8,415)
1,003,807 C$ 1,371,200 12/20/96 (6,732)
655,480 ITL 1,006,915,000 12/20/96 (2,254)
675,736 ESP 86,430,000 12/24/96 4,855
4,233,436 (Y) 456,787,750 12/24/96 88,730
----------
$ 145,729
==========
Currency Legend:
C$ - Canadian Dollar NLG - Netherlands Guilder
CHF - Swiss Franc (pound) - British Sterling
ESP - Spanish Peseta SEK - Swedish Krona
FIM - Finnish Markka (Y) - Japanese Yen
ITL - Italian Lira
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareholders and the Board of Directors of
Bailard, Biehl & Kaiser International Equity Fund
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Bailard, Biehl & Kaiser
International Equity Fund (a series of Bailard, Biehl & Kaiser International
Fund Group, Inc.) at September 30, 1996, and the results of its operations, the
changes in its net assets and its financial highlights for the periods
indicated, in conformity with generally accepted accounting principles. These
financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities owned at
September 30, 1996 by correspondence with the custodian and brokers (and the
application of alternative auditing procedures where confirmations from brokers
were not received), provide a reasonable basis for the opinion expressed above.
Price Waterhouse LLP
Boston, Massachusetts
November 15, 1996
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
Federal Income Tax Information: (Unaudited)
For the fiscal year ended September 30, 1996, the Fund accrued foreign source
income of $2,369,574 and the Fund accrued foreign taxes amounting to $302,886,
which are expected to be passed through to shareholders as foreign tax credits
on Form 1099-DIV for the year ending December 31, 1996.
<PAGE>
BB&K Int'l Equity Fund
BB&K Int'l Morgan St MS EAFE (US$)
Sep-86 $ 10,000 $ 10,000 $ 10,000
Dec-86 $ 9,864 $ 10,455 $ 10,397
Mar-87 $ 10,770 $ 11,896 $ 12,840
Jun-87 $ 10,969 $ 12,796 $ 13,753
Sep-87 $ 11,524 $ 13,507 $ 14,532
Dec-87 $ 10,029 $ 10,215 $ 12,982
Mar-88 $ 10,637 $ 12,043 $ 14,977
Jun-88 $ 10,109 $ 12,417 $ 14,316
Sep-88 $ 10,083 $ 12,670 $ 14,408
Dec-88 $ 11,110 $ 13,688 $ 16,681
Mar-89 $ 10,936 $ 14,556 $ 16,727
Jun-89 $ 10,598 $ 14,624 $ 15,689
Sep-89 $ 11,981 $ 15,922 $ 17,645
Dec-89 $ 12,555 $ 16,646 $ 18,449
Mar-90 $ 10,936 $ 14,004 $ 14,781
Jun-90 $ 11,976 $ 14,746 $ 16,203
Sep-90 $ 9,544 $ 10,739 $ 12,747
Dec-90 $ 10,027 $ 11,651 $ 14,100
Mar-91 $ 10,875 $ 13,378 $ 15,155
Jun-91 $ 10,308 $ 12,909 $ 14,323
Sep-91 $ 10,621 $ 13,279 $ 15,559
Dec-91 $ 10,106 $ 12,673 $ 15,822
Mar-92 $ 9,555 $ 11,906 $ 13,932
Jun-92 $ 9,544 $ 11,854 $ 14,229
Sep-92 $ 9,008 $ 11,700 $ 14,445
Dec-92 $ 8,853 $ 12,372 $ 13,884
Mar-93 $ 9,096 $ 13,430 $ 15,560
Jun-93 $ 9,769 $ 14,326 $ 17,135
Sep-93 $ 10,583 $ 15,247 $ 18,278
Dec-93 $ 12,149 $ 16,013 $ 18,437
Mar-94 $ 11,303 $ 15,755 $ 19,085
Jun-94 $ 11,135 $ 15,919 $ 20,065
Sep-94 $ 11,360 $ 15,762 $ 20,085
Dec-94 $ 10,609 $ 15,686 $ 19,879
Mar-95 $ 10,665 $ 14,454 $ 20,250
Jun-95 $ 11,234 $ 14,523 $ 20,399
Sep-95 $ 11,604 $ 16,159 $ 21,254
Dec-95 $ 11,944 $ 17,183 $ 22,118
Mar-96 $ 12,214 $ 18,111 $ 22,761
Jun-96 $ 12,462 $ 18,892 $ 23,122
Sep-96 $ 12,462 $ 18,752 $ 23,092
Average Annual Total Return
---------------------------
1 Year 5 Year 10 Year
------ ------ -------
7.33% 3.17% 2.18%
This graph (as mandated by the Securities and Exchange Commission), shows the
historic growth of a $10,000 investment in the Bailard, Biehl & Kaiser
International Equity Fund since October 1, 1986. We compare this investment to
the growth in the Morgan Stanley EAFE stock index over the same time period. The
index, which measures the performance of the international equity markets, is
given in both U.S. dollar and local currency terms. As the graph indicates, a
$10,000 investment in the Bailard, Biehl & Kaiser International Equity Fund
would have grown to $12,462 over the ten-year period ended September 30, 1996.
* Total return summary for investment periods ended September 30, 1996; 12
months: 7.33%; 5 years: 3.17% annualized; and 10 years: 2.18% annualized. As
required by the Securities and Exchange Commission, these figures reflect
the average annual compounded return over the period indicated that would
equate an initial amount invested in shares of the Fund to the ending
redeemable value of such shares, assuming that all dividends and
distributions by the Fund were reinvested at net asset value. These figures
also reflect the deduction of an assumed 1% annual investment management fee
(-0.25% quarterly) payable by clients of Bailard, Biehl & Kaiser through
9/30/93. As of 10/1/93, the Fund charged a management fee of 0.95%. Actual
fees varied during this period. The performance data quoted represents past
performance, and the investment return and principal value of an investment
in the Bailard, Biehl & Kaiser International Equity Fund will fluctuate so
that an investor's shares, when redeemed, may be worth more or less than
their original cost.
<PAGE>
Investment Advisor
Bailard, Biehl & Kaiser, Inc.
2755 Campus Drive
San Mateo, California 94403
Transfer Agent
Chase Global Funds Services Company
Boston, Massachusetts
Custodian and Accountant
Brown Brothers Harriman & Co.
Boston, Massachusetts
Counsel
Howard, Rice, Nemerovski, Canady, Falk & Rabkin
San Francisco, California
Distributor
BB&K Fund Services, Inc.
2755 Campus Drive
San Mateo, California 94403
Independent Accountant
Price Waterhouse LLP
Boston, Massachusetts
IRA Custodian
The Chase Manhattan Bank, N.A.
New York, New York
International Equity Fund Officers And Directors
Peter M. Hill, Chairman, Director
Burnice E. Sparks, Jr., President, Director
Barbara V. Bailey, Treasurer
Janis M. Horne, Secretary
Sofi Zacharias, Assistant Treasurer & Assistant Secretary
Shirley L. Clayton, Director
David B. Shippey, Director
James C. Van Horne, Director
Investor Services Department
(800) 882-8383
This report is submitted for the general information of the shareholders of the
Bailard, Biehl & Kaiser International Equity. The report is not authorized for
distribution to prospective investors unless preceded or accompanied by an
effective prospectus.
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL FUND GROUP, INC.
[GRAPHIC]
Bailard, Biehl & Kaiser International Bond Fund
A No Load Fund With No 12B-1 Plan
Annual Report
As of September 30, 1996
<PAGE>
November 29, 1996
Dear Shareholder:
We are pleased to present your September 30, 1996, annual shareholders' report
for the Bailard Biehl & Kaiser International Bond Fund. It includes a review of
the Fund's performance and our outlook for the months ahead.
Performance and Market Review
The last year has been good for international bonds, for slow economic growth
abroad led to local market returns of greater than 10% in most countries.
Stronger economic growth in the U.S., however, pushed the dollar higher relative
to many European currencies and the Japanese yen. This currency appreciation
offset some of the favorable returns overseas. U.S. dollar returns in the larger
European markets were generally less than 5%. In contrast, optimism over
monetary union in Europe caused the currencies of Spain, Italy and Sweden to
rise against the dollar. U.S. dollar returns were as high as 29% in Italy. The
Australian currency also gained against the dollar, bringing returns for U.S.
investors to 17.8%. Japanese bonds were weak throughout the year, returning only
3.2% in local currency terms and losing 8.6% in dollar terms. Due to its
investments in the smaller European markets and the dollar block markets of
Australia and Canada, the Bailard Biehl & Kaiser International Bond Fund
performed well, with a total return of 9.32%* for the year ended September 30,
1996. The Fund's currency hedging strategy also helped boost its returns.
Market Outlook
Looking ahead, we expect to see the recovery in the European economies gain
momentum in 1997. However, stubborn structural problems in the labor market and
the social welfare system will ensure that only slow growth will be achieved. As
a result, monetary policy should continue to be favorable in the near term since
inflation is likely to remain subdued. In general, we expect European bond
yields to be stable over the next few months. By the second quarter of 1997,
growth may be strong enough to cause central banks to tighten and bond yields to
rise.
In Japan, despite a strong first quarter, growth remains disappointing. As a
result, the bond market has rallied in September and October. Now yields are
approaching all time lows of 2.5%. Even with the economic weakness, we do not
expect to see yields move significantly lower from here. With yields this low,
it will be difficult to match returns in other markets. As a consequence, we
expect another year of underperformance for Japanese bonds.
<PAGE>
The dollar block bond markets offer the best opportunity for further gains. Both
Canada and Australia continue to have high yields relative to their inflation
rates. The Australian economy is more favorable for bonds because slowing
economic growth should allow bond yields to decline further. In Canada, the
economy has been slow, but is expected to accelerate in the coming year.
Canadian bond yields are now close to U.S. yields, and their future performance
is likely to be tied to the U.S. market.
Conclusion
In spite of low inflation rates, the prospect of improving economic growth in
Europe and Japan will make it difficult for bond yields to decline in 1997.
However, there are two areas of opportunity for international bonds: the smaller
markets of Europe and the dollar bloc markets. Provided their governments
continue to adopt fiscal and monetary policies that support the achievement of
monetary union, the smaller bond markets of Europe should continue to perform
well. In the dollar bloc markets, if inflation remains low, real yields are too
high, and there remains considerable room for long-term yields to decline
further.
We appreciate the opportunity to manage your international bond investments and
look forward to continued success. If you have any questions, please feel free
to call us at (800) 882-8383.
Sincerely,
/s/ Peter M. Hill /s/ Burnice E. Sparks, Jr.
Peter M. Hill Burnice E. Sparks, Jr.
Chairman President
* Average annual total returns for investment periods ended September 30,
1996: 3 months: 3.59%; 6 months: 5.26%; 12 months: 9.32%; 5 years: 5.29%
annualized; and since inception (10/1/90): 6.15%, annualized. As required
by the Securities and Exchange Commission, these figures reflect the
average compounded return over the period indicated that would equate an
initial amount invested in shares of the Fund to the ending redeemable
value of such shares, assuming that all dividends and distributions by the
Fund were reinvested at net asset value. These figures also reflect the
deduction of an assumed 1% annual investment management fee (0.25%
quarterly) payable by clients of Bailard, Biehl & Kaiser through 9/30/93.
As of 10/1/93, the Fund charged a management fee of 0.75%. Actual fees
varied during this period. The performance data quoted represents past
performance, and the investment return and principal value of an investment
in the Bailard, Biehl & Kaiser International Bond Fund will fluctuate so
that an investor's shares, when redeemed, may be worth more or less than
their original cost.
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1996
- --------------------------------------------------------------------------------
Par Value Value
-------------- -----------------
Senior Securities (94.70%) 94.70%
Australian Dollar (2.32%) 2.32%
Government of Australia
10.000% 10/15/02 A$ 675,000 $ 597,670
Government of Australia
7.000% 04/15/00 A$ 500,000 394,050
Queensland Treasury Corp.
8.000% 05/14/03 A$ 650,000 523,186
-----------------
Total Australian Dollar 1,514,906
-----------------
Belgium Franc (5.09%) 5.10%
Government of Belgium
10.000% 08/02/00 BEF 25,000,000 941,428
Government of Belgium
9.000% 03/28/03 BEF 36,000,000 1,354,511
Government of Belgium
8.750% 06/25/02 BEF 28,000,000 1,036,227
-----------------
Total Belgium Franc 3,332,166
-----------------
British Pound (9.52%) 9.52%
Republic of Austria
9.000% 07/22/04 (pound) 1,750,000 2,942,059
European Investment Bank
9.000% 07/16/01 (pound) 600,000 1,007,238
United Kingdom Treasury
9.750% 08/27/02 (pound) 1,300,000 2,272,645
-----------------
Total British Pound 6,221,942
-----------------
Canadian Dollar (8.12%) 8.12%
Government of Canada
6.500% 06/01/04 C$ 4,000,000 2,869,167
Government of Canada
10.250% 03/15/14 C$ 1,000,000 922,386
KFW International Finance
10.000% 03/05/01 C$ 1,825,000 1,516,972
-----------------
Total Canadian Dollar 5,308,525
-----------------
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value Value
------------------- -----------------
<S> <C> <C>
Danish Kroner (5.96%) 5.96%
Kingdom of Denmark
9.000% 11/15/00 DKr 12,500,000 $ 2,407,503
Kingdom of Denmark
8.000% 05/15/03 DKr 8,000,000 1,486,461
-----------------
Total Danish Kroner 3,893,964
-----------------
Finnish Markka (0.80%) 0.80%
Government of Finland
10.000% 09/15/01 FIM 2,000,000 524,950
-----------------
French Franc (10.37%) 10.37%
Government of France (O.A.T.)
7.750% 04/12/00 FF 15,000,000 3,185,038
Government of France (O.A.T.)
6.750% 10/25/03 FF 17,500,000 3,595,876
-----------------
Total French Franc 6,780,914
-----------------
German Mark (19.87%) 19.87%
Baden Wurttemberg
6.000% 01/25/06 DM 2,000,000 1,284,527
Deutsche Bundespost
6.250% 10/01/03 DM 2,500,000 1,674,199
European Investment Bank
7.500% 11/04/02 DM 1,300,000 933,589
German Federal Republic
8.375% 05/21/01 DM 7,700,000 5,732,923
German Federal Republic
8.250% 09/20/01 DM 1,500,000 1,115,750
German Federal Republic
7.375% 01/03/05 DM 1,300,000 926,777
International Bank for Reconstruction & Development
5.875% 11/10/03 DM 2,000,000 1,326,181
-----------------
Total German Mark 12,993,946
-----------------
Italian Lira (9.21%) 9.21%
American International Group Inc.
11.700% 12/04/01 ITL 5,500,000,000 4,143,870
</TABLE>
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value Value
----------------- -----------------
<S> <C> <C>
Italian Lira - Continued
Government of Italy
10.500% 04/01/00 ITL 2,650,000,000 $ 1,875,926
-----------------
Total Italian Lira 6,019,796
-----------------
Japanese Yen (11.54%) 11.54%
Asian Development Bank
5.625% 02/18/02 (Y) 235,000,000 2,462,326
Autobahnen & Schnellstrassen Fin AG
6.000% 03/11/00 (Y) 215,000,000 2,207,017
International Bank For Reconstruction & Development
4.750% 12/20/04 (Y) 113,000,000 1,161,233
Japan Development Bank
6.500% 09/20/01 (Y) 158,000,000 1,713,560
-----------------
Total Japanese Yen 7,544,136
-----------------
Netherlands Guilder (5.92%) 5.92%
Government of Netherlands
8.500% 03/15/01 NLG 2,700,000 1,802,026
Government of Netherlands
7.750% 03/01/05 NLG 3,150,000 2,068,336
-----------------
Total Netherlands Guilder 3,870,362
-----------------
Spanish Peseta (2.89%) 2.89%
Government of Spain
7.400% 07/30/99 ESP 240,000,000 1,886,461
-----------------
Swedish Krona (3.09%) 3.09%
Kingdom of Sweden
10.250% 05/05/00 SEK 2,600,000 440,216
Kingdom of Sweden
10.250% 05/05/03 SEK 9,000,000 1,581,757
-----------------
Total Swedish Kroner 2,021,973
-----------------
Total Senior Securities (94.70%)
(Identified Cost $60,893,809) 94.70% 61,914,041
-----------------
</TABLE>
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value Value
------------------ ----------------
<S> <C> <C>
Short-Term Investments (1.33%)
Brown Brothers Harriman & Co. (Grand Cayman Branch)
5.00% Call Account 1.33%
(Identified Cost $871,000) $ 871,000 $ 871,000
-----------------
Total Investments (96.03%) 96.03%
(Identified Cost $61,764,809) 62,785,041
Other Assets Less Liabilities (3.97%) 3.97% 2,595,663
-----------------
Net Assets (100%) 100.00% $ 65,380,704
=================
</TABLE>
Currency Legend:
A$ - Australian Dollar DM - German Mark
BEF - Belgium Franc ITL - Italian Lira
(pound) - British Sterling (Y) - Japanese Yen
C$ - Canadian Dollar NLG - Netherlands Guilder
DKr - Danish Kroner ESP - Spanish Peseta
FIM - Finnish Markka SEK - Swedish Krona
FF - French Franc
(See "Notes to Financial Statements")
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets
<S> <C> <C>
Investments, at value
(Identified cost $61,764,809) $ 62,785,041
Foreign currency, at value
(Identified cost $67,730) 66,647
Cash 778
Receivables:
Interest and recoverable foreign taxes receivable $2,211,119
Unrealized gain on forward currency contracts (Note 5) 474,266
Fund shares sold 7,553 2,692,938
----------
Prepaid expenses 14,107
------------
Total assets 65,559,511
------------
Liabilities
Payable for shares of the Fund redeemed 2,872
Accrued management fees (Note 3) 32,420
Other accrued expenses 143,515
------------
Total liabilities 178,807
------------
Net assets (equivalent to $8.38 per share,
representing the offering and redemption
price for 7,800,539 shares outstanding,
100,000,000 shares authorized) $ 65,380,704
============
Net assets consist of:
Capital paid in $ 79,215,200
Accumulated undistributed net investment income 1,149,884
Accumulated net realized loss on investments
and foreign currency transactions (16,458,026)
Unrealized appreciation on:
Investments $1,020,232
Foreign currency 453,414 1,473,646
---------- ------------
$ 65,380,704
============
</TABLE>
See "Notes to Financial Statements"
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
STATEMENT OF OPERATIONS
SEPTEMBER 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment Income
Interest (net of foreign taxes withheld of $37,125) $4,232,891
Expenses
Advisory fees $461,792
Custodian fees 144,326
Audit and legal fees 68,002
Transfer agent fees 36,999
Administrative fees 32,999
Directors' fees and expenses 16,002
Insurance 1,278
Registration fees 2,371
Miscellaneous expenses 15,239
--------
Total expenses 779,008
----------
Net investment income 3,453,883
----------
Realized and Unrealized Gain (Loss)
on Investments and Foreign Currency
Net realized gain on investments 1,650,647
Net unrealized loss on investments (979,859)
----------
Net gain on investments 670,788
----------
Net realized gain on foreign currency 425,210
Net unrealized gain on foreign currency
and foreign currency denominated assets and
liabilities 1,192,632
----------
Net gain on foreign currency 1,617,842
----------
Net gain on investments and foreign currency 2,288,630
----------
FOREIGN CURRENCY
Net increase in net assets resulting from operations $5,742,513
==========
</TABLE>
See "Notes to Financial Statements"
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the year ended September 30,
--------------------------------
1996 1995
---- ----
<S> <C> <C>
Increase (Decrease) in Net Assets
Operations:
Net investment income $ 3,453,883 $ 5,805,168
Net realized gain on investments 1,650,647 13,483,733
Net unrealized gain (loss) on investments (979,859) 1,750,599
Net realized gain (loss) on foreign currency 425,210 (4,104,103)
Net unrealized gain on foreign currency and
foreign currency denominated assets and liabilities 1,192,632 627,058
------------- -------------
Net increase resulting from operations 5,742,513 17,562,455
------------- -------------
Distributions to shareholders:
From net investment income (3,453,883) (5,805,168)
For tax purposes in excess of
net investment income (4,924,771) (1,595,884)
------------- -------------
Total distributions (8,378,654) (7,401,052)
------------- -------------
Fund share transactions:
Proceeds from shares sold 8,593,553 38,075,626
Net asset value of shares issued on
reinvestment of distributions 6,776,337 5,311,388
Cost of shares redeemed (11,993,072) (125,274,300)
------------- -------------
Net increase (decrease) resulting from
Fund share transactions 3,376,818 (81,887,286)
------------- -------------
Net increase (decrease) 740,677 (71,725,883)
Net Assets
Beginning of year 64,640,027 136,365,910
------------- -------------
End of year (including undistributed
net investment income of $1,149,884 and
$5,239,089, respectively) $ 65,380,704 $ 64,640,027
============= =============
Number of Fund Shares
Sold 1,041,195 4,780,250
Issued on reinvestment of distributions 828,660 651,288
Redeemed (1,430,146) (15,069,674)
------------- -------------
Net increase (decrease) 439,709 (9,638,136)
============= =============
</TABLE>
See "Notes to Financial Statements"
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
For a share outstanding throughout the year:
<TABLE>
<CAPTION>
Year Ended September 30,(1)
-----------------------------------------------------------------------------
1996(2) 1995(2) 1994(2) 1993 1992
------- ------- ------- ---- ----
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year $ 8.78 $ 8.02 $ 10.85 $ 11.29 $ 10.94
----------- ----------- ----------- ----------- -----------
Income from Investment Operations:
Net Investment Income 0.59 0.47 0.61 0.67 0.85
Net Realized/Unrealized Gain (Loss) on
Securities and Foreign Currency 0.16 0.86 (2.39) 0.39 0.53
----------- ----------- ----------- ----------- -----------
Total from Investment Operations 0.75 1.33 (1.78) 1.06 1.38
----------- ----------- ----------- ----------- -----------
Less Distributions:
Net Investment Income (0.45) (0.45) (0.26) (1.08) (0.94)
For Tax Purposes in Excess of Book
Net Investment Income (0.70) (0.12) -- -- --
Capital Gains -- -- (0.27) (0.42) (0.09)
Return of Capital -- -- (0.52) -- --
----------- ----------- ----------- ----------- -----------
Total Distributions (1.15) (0.57) (1.05) (1.50) (1.03)
----------- ----------- ----------- ----------- -----------
Net Asset Value, End of Year $ 8.38 $ 8.78 $ 8.02 $ 10.85 $ 11.29
=========== =========== =========== =========== ===========
Total Return 9.32% 17.33% (17.90%) 10.65% 13.57%
Ratios/Supplemental Data:
Net Assets, End of Year (000's) $ 65,381 $ 64,640 $ 136,366 $ 165,484 $ 115,628
Ratio of Expenses to Average Net Assets 1.22% 1.16% 1.12% 0.42% 0.64%
Ratio of Net Investment Income to
Average Net Assets 5.41% 5.66% 5.87% 6.25% 7.37%
Portfolio Turnover Rate 61% 179% 319% 157% 140%
</TABLE>
___________________________________________________________
1. On October 1, 1993, the Fund and the Advisor entered into a new
Investment Management Agreement pursuant to which the Fund is required
to pay certain management fees to the Advisor. Prior to that date,
advisory fees were directly charged to clients of Bailard, Biehl &
Kaiser, Inc. and the Fund did not pay any management fees. If such
directly charged fees were included as Fund expense at an assumed 1%
annual rate payable quarterly, pro-forma total return (unaudited) was
9.55% and 12.44% for the years ended September 30, 1993 and 1992,
respectively.
2. Net investment income per share has been computed before adjustments for
book/tax differences. "Distributions for Tax Purposes in Excess of Net
Investment Income" represent amounts paid from foreign currency gains
reclassified to net investment income under the Internal Revenue Code.
See "Notes to Financial Statements"
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Note 1 - Summary of Significant Accounting Policies
The Bailard, Biehl & Kaiser International Bond Fund (the "Fund") (prior to
January 26, 1996, the Bailard, Biehl & Kaiser International Fixed-Income Fund)
is a series of the Bailard, Biehl & Kaiser International Fund Group, Inc. (the
"Group"), which was organized as a Maryland corporation in June 1990 and is
registered under the Investment Company Act of 1940 as a non-diversified,
open-end management investment company. The following significant accounting
policies are followed by the Fund in the preparation of its financial statements
and are in conformity with generally accepted accounting principles.
Security Valuation
Investments in securities traded on an exchange or quoted on the
over-the-counter market are valued at the last transaction price reported on the
principal exchange or market on which the issue is traded, or, if no transaction
occurred during the day, at the mean between the current closing bid and asked
prices, except U.S. Government obligations which in all cases are stated at the
mean between the current closing bid and asked price, as last reported by a
pricing service approved by the Board of Directors.
When market quotations are not readily available, or when restricted securities
or other assets are being valued, such assets are valued at fair value as
determined in good faith by or under procedures established by the Board of
Directors. Short-term investments denominated in U.S. dollars that will mature
in 60 days or less are stated at amortized cost; such investments denominated in
foreign currencies are stated at amortized cost as determined in the foreign
currency and translated to U.S. dollars at the current day's exchange rate.
The Fund's investment in foreign securities may entail risks due to the
potential of political and economic instability in the countries in which the
securities are offered or the issuers conduct their operations. It is the Fund's
policy to continuously monitor its exposure to these risks.
Foreign Currency
Foreign currency amounts, other than the cost of investments, are translated
into U.S. dollar values at the mean of the bid and offer price of such currency
against U.S. dollars last quoted on the valuation date. The cost of investments
is translated at the rates of exchange prevailing on the dates the portfolio
securities were acquired.
The Fund includes foreign exchange gains and losses from interest receivable and
other foreign-currency denominated payables and receivables in realized and
unrealized gain (loss) on foreign currency. The Fund does not isolate that
portion of realized and unrealized gain (loss) on investments resulting from
changes in foreign exchange rates on investments from fluctuations arising from
changes in the market price of securities for financial reporting purposes.
Fluctuations in foreign exchange rates on investments are thus included with net
realized and unrealized gain (loss) on investments.
Forward Foreign Currency Exchange Contracts
In connection with purchases and sales of securities denominated in a foreign
currency the Fund may enter into forward foreign currency exchange contracts
("contracts"). Additionally, from time to time the Fund may enter into contracts
to sell foreign currencies to hedge certain foreign currency denominated assets.
All commitments are "marked-to-market" daily at the applicable translation rates
supplied by a quotation service and any resulting unrealized gains or losses are
included as unrealized appreciation (depreciation) on foreign currency
denominated assets and liabilities. The Fund records realized gains or losses at
the time the forward contract is settled. Risks may arise upon entering into
these contracts from the potential inability of counterparties to meet the terms
of their contracts and from unanticipated movements in the value of a foreign
currency relative to the U.S. dollar.
Federal Income Taxes
The Fund's policy is to comply with the requirements of the Internal Revenue
Code ("Code") applicable to regulated investment companies and to distribute all
of its income to its shareholders. It is also the Fund's intention to make
distributions in amounts sufficient to avoid imposition of excise tax under the
Code. Therefore, no provision is made for Federal income or excise taxes.
The amount of distributions for tax purposes in excess of book net investment
income for the years ended September 30, 1996 and 1995 represents amounts paid
to shareholders from foreign currency gains reclassified to net investment
income under the Code.
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
NOTE 1 - Continued
At September 30, 1996, the Fund had a capital loss carryforward of approximately
$16,401,000, which may be carried forward through the fiscal year ending
September 30, 2003.
Paid in capital, undistributed net investment income and accumulated net
realized loss have been adjusted for permanent book-tax differences.
Reclassifications between undistributed net investment income and accumulated
net realized loss arose principally from differing book and tax treatments for
foreign currency transactions.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Other
Investment security transactions are accounted for on the trade date (the date
the order to buy or sell is executed). Interest income is recorded on the
accrual basis. Distributions to shareholders are recorded on the ex-dividend
date. The Fund uses the identified cost method for determining realized gain or
loss on investments. Certain expenses of the Group are allocated between the
series of the Group in such manner as the Directors deem appropriate.
Note 2 - Purchases and Sales of Securities
For the year ended September 30, 1996, purchases and sales of investment
securities other than short-term investments aggregated $36,995,207 and
$37,183,656, respectively. There were no purchases and sales of U.S. Government
obligations during the year ended September 30, 1996.
Note 3 - Management Agreement and Other Transactions with Affiliates
The Fund has entered into an Investment Management Agreement with Bailard, Biehl
& Kaiser, Inc. (the "Advisor") for investment advisory services. Under the
agreement, the Advisor receives a fee, payable monthly, at the annual rate of
0.75% of the average net assets of the Fund. Advisory fees paid on shares of the
Fund owned are taken into account in the computation of fees payable under
individual advisory agreements for advisory clients of the Advisor.
The Advisor has agreed to reimburse the Fund to the extent that the Fund's
operating expenses (as defined) exceed 2.5% of the first $30 million of average
net assets, 2.0% of the next $70 million and 1.5% of average net assets in
excess of $100 million.
Certain officers and directors of the Group are currently officers and directors
of the Advisor and receive total compensation from the Group of $500 per year.
Each other director is compensated by the Group at the total rate of $6,000 per
year plus $1,000 for each meeting of the Board of Directors attended and travel
expenses incurred in such meetings.
Note 4 - Unrealized Appreciation (Depreciation) on a Tax Basis
Unrealized appreciation (depreciation) on September 30, 1996, based on the cost
of securities of $61,822,219 for federal income tax purposes, consists of the
following:
Gross unrealized appreciation $ 2,358,116
Gross unrealized depreciation (1,395,294)
--------------
Net unrealized appreciation $ 962,822
==============
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
Note 5 - Forward Foreign Currency Contracts
At September 30, 1996 the Fund had entered into forward foreign currency
contracts which obligated the Fund to exchange currencies at specified future
dates. At the maturity of a forward contract, the Fund may either make delivery
of the foreign currency from currency held, if any, or from the proceeds of
portfolio securities sold, or it may terminate its obligation to deliver the
foreign currency at any time by purchasing an offsetting contract. The forward
value of amounts due to the Fund under the contracts, including contracts which
have been offset but remained unsettled, has been netted against the forward
value of the currency to be delivered by the Fund and the remaining amount is
shown as receivable (payable) for forward currency contracts in the financial
statements. Open forward foreign currency exchange contracts outstanding at
September 30, 1996 were as follows:
Currency Currency Delivery Unrealized
Receivable Deliverable Date Appreciation/(Depreciation)
---------- ----------- -------- ---------------------------
$1,714,667 DKr 9,730,733 10/29/96 $ 51,021
814,112 A$ 1,031,468 11/29/96 (1,044)
2,111,928 (Y) 226,187,500 11/29/96 68,274
1,174,105 SEK 7,755,550 11/29/96 2,242
6,079,866 DM 9,014,123 12/09/96 148,112
4,598,317 FF 23,267,484 12/10/96 75,406
3,006,021 (pound) 1,922,997 12/10/96 (2,553)
1,000,000 NLG 1,663,900 12/11/96 23,113
750,000 FIM 3,407,400 12/12/96 414
1,383,017 (pound) 889,400 12/16/96 (8,454)
ESP
1,883,085 BEF 58,225,000 12/16/96 20,499
2,340,493 NLG 3,936,710 12/16/96 28,263
2,071,361 DM 3,111,184 12/18/96 22,676
3,401,640 C$ 4,646,640 12/20/96 (22,813)
4,011,865 ITL 6,162,827,000 12/20/96 (13,794)
1,522,693 ESP 194,760,000 12/24/96 10,941
3,912,276 (Y) 423,384,575 12/24/96 70,657
1,500,000 CHF 1,860,480 12/31/96 1,305
----------
SKr $ 474,266
==========
Currency Legend:
A$ - Australian Dollar ITL - Italian Lira
BEF - Belgian Franc NLG - Netherlands Guilder
C$ - Canadian Dollar (pound) - British Sterling
CHF - Swiss Franc FIM - Finnish Markka
DKr - Danish Kroner FF - French Franc
DM - German Mark SEK - Swedish Krona
ESP - Spanish Peseta (Y) - Japanese Yen
<PAGE>
BAILARD, BIEHL & KAISER
INTERNATIONAL BOND FUND
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareholders and the Board of Directors of
Bailard, Biehl & Kaiser International Bond Fund
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Bailard, Biehl & Kaiser
International Bond Fund (a series of Bailard, Biehl & Kaiser International Fund
Group, Inc.); formerly Bailard, Biehl & Kaiser International Fixed- Income Fund,
at September 30, 1996, and the results of its operations, the changes in its net
assets and its financial highlights for the periods indicated, in conformity
with generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Fund's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities owned at September 30, 1996 by
correspondence with the custodian, provide a reasonable basis for the opinion
expressed above.
Price Waterhouse LLP
Boston, Massachusetts
November 15, 1996
<PAGE>
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<PAGE>
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<PAGE>
BB&K Int'l Bond
BB&K Int'l SB WG10Non$H
Sep-90 $10,000 $10,000
Dec-90 $10,256 $10,565
Mar-91 $10,343 $10,933
Jun-91 $10,235 $10,992
Sep-91 $11,022 $11,424
Dec-91 $11,585 $11,750
Mar-92 $11,411 $11,821
Jun-92 $11,971 $12,037
Sep-92 $12,405 $12,362
Dec-92 $12,274 $12,678
Mar-93 $12,927 $13,041
Jun-93 $13,304 $13,258
Sep-93 $13,599 $13,774
Dec-93 $13,999 $14,358
Mar-94 $12,637 $13,829
Jun-94 $11,383 $13,538
Sep-94 $11,147 $13,580
Dec-94 $11,291 $13,821
Mar-95 $12,399 $14,586
Jun-95 $12,887 $15,296
Sep-95 $13,097 $15,816
Dec-95 $13,639 $16,414
Mar-96 $13,606 $16,543
Jun-96 $13,827 $16,881
Sep-96 $14,327 $17,575
Average Annual Total Return
---------------------------
1 Year 5 Year Since Inception
------ ------ ---------------
9.32% 5.29% 6.15%
The above graph shows the historic growth of a $10,000 investment in the
Bailard, Biehl & Kaiser International Bond Fund since October 1, 1990. The graph
shows the cumulative return of the Bailard, Biehl & Kaiser International Bond
Fund and the Salomon Brothers World Government 10 country, non-U.S. bond index,
fully hedged. The index, which measures the performance of the government bonds
of ten countries, is given on a fully hedged basis. As the graph indicates, a
$10,000 investment in the Bailard, Biehl & Kaiser International Bond Fund would
have grown to $14,327 by September 30, 1996.
* Total return summary for investment periods ended September 30, 1995, 12
months: 9.32%; 5 years: 5.29% annualized; since inception (10/1/90): 6.15%,
annualized. These figures reflect the average annual compounded return over
the period indicated that would equate an initial amount invested in shares
of the Fund to the ending redeemable value of such shares, assuming that
all dividends and distributions by the Fund were reinvested at net asset
value. These figures also reflect the deduction of an assumed 1% annual
investment management fee (0.25% quarterly) payable by clients of Bailard,
Biehl & Kaiser through September 30, 1993. As of 10/1/93, the Fund began
charging a management fee of 0.75%. Actual fees varied during this period.
The performance data quoted represents past performance, and the investment
return and principal value of an investment in the Bailard, Biehl & Kaiser
International Bond Fund will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than their original cost.
<PAGE>
Investment Advisor
Bailard, Biehl & Kaiser, Inc.
2755 Campus Drive
San Mateo, California 94403
Transfer Agent
Chase Global Funds Services Company
Boston, Massachusetts
Custodian and Accountant
Brown Brothers Harriman & Co.
Boston, Massachusetts
Counsel
Howard, Rice, Nemerovski, Canady, Falk & Rabkin
San Francisco, California
Distributor
BB&K Fund Services, Inc.
2755 Campus Drive
San Mateo, California 94403
Independent Accountant
Price Waterhouse LLP
Boston, Massachusetts
IRA Custodian
The Chase Manhattan Bank, N.A.
New York, New York
International Bond Fund Officers and Directors
Peter M. Hill, Chairman, Director
Burnice E. Sparks, Jr., President, Director
Barbara V. Bailey, Treasurer
Janis M. Horne, Secretary
Sofi Zacharias, Assistant Treasurer & Assistant Secretary
Shirley L. Clayton, Director
David B. Shippey, Director
James C. Van Horne, Director
Investor Services Department
(800) 882-8383
This report is submitted for the general information of the shareholders of the
Bailard, Biehl & Kaiser International Bond Fund. The report is not authorized
for distribution to prospective investors unless preceded or accompanied by an
effective prospectus.
