Combined Semi-Annual
Report To Shareholders
October 31, 1999
- ----------------------
Class R Shares
Riggs U.S. Treasury Money Market Fund
Riggs Prime Money Market Fund
Riggs U.S. Government Securities Fund
Riggs Stock Fund
Riggs Small Company Stock Fund
Class Y Shares
Riggs U.S. Treasury Money Market Fund
Riggs Prime Money Market Fund
[LOGO OF RIGGS FUNDS]
Mutual funds are not FDIC insured and are not deposits or obligations of or
guaranteed by Riggs Bank N.A. They involve investment risks, including the
possible loss of the principal amount invested.
Federated Securities Corp., Distributor
PRESIDENT'S MESSAGE
Dear Investor:
I am pleased to present the Semi-Annual Report for the Riggs Funds--Class R and
Class Y Shares--for the first half of the funds' current fiscal year, which is
the six-month reporting period ending October 31, 1999. It begins with an
investment commentary by each portfolio manager, followed by a complete list of
holdings and the financial statements for the Riggs U.S. Treasury Money Market
Fund, Riggs Prime Money Market Fund, Riggs U.S. Government Securities Fund,
Riggs Stock Fund, and Riggs Small Company Stock Fund.
The following highlights summarize fund performance over the six-month reporting
period:
Riggs U.S. Treasury Money Market Fund
This is the most conservative Riggs fund, which is managed to help shareholders
earn daily income on their ready cash through a portfolio of direct U.S.
Treasury money market securities or repurchase agreements fully backed by U.S.
Treasury securities.* The fund's portfolio of U.S. Treasury money market
securities paid dividends totaling $0.02 per share for Class Y Shares and $0.02
per share for Class R Shares over the reporting period. Assets in the fund
totaled $130 million at the end of the reporting period.
Riggs Prime Money Market Fund
This fund helps shareholders earn daily income on their ready cash through a
portfolio of high-quality money market securities.* The fund's Class Y Shares
and Class R Shares each paid dividends totaling $0.02 per share. The fund ended
the reporting period with total assets of $342 million.
Riggs U.S. Government Securities Fund
This fund's government-focused bond portfolio paid Class R Share dividends
totaling $0.26 per share. Due to a rising rate environment that caused bond
prices to decline, the fund's net asset value declined from $9.85 to $9.54. The
dividends and net asset value decrease resulted in a total return of (0.54%)**,
or (2.48%)** adjusted for the redemption fee. The fund's $35 million in assets
at the end of the reporting period were invested across government agency
securities (62.6%) and U.S. Treasury obligations (28.3%), corporate bonds
(2.8%), and a repurchase agreement (5.3%).
Riggs Stock Fund
The six-month reporting period was a weak period for the U.S. stock market. As a
result, the fund's diversified portfolio of high-quality stocks--which included
many household names like American Express, AT&T, Intel, Johnson & Johnson,
Mobil, Sears, and Xerox--produced a negative total return. The Class R Shares
total return was (7.55%)**, or (9.22%)** adjusted for the redemption fee. The
Class R Shares return was the result of a $2.67 decline in net asset value,
$0.01 per share in dividend income and a $1.44 capital gains distribution. The
fund's net assets totaled $78.3 million at the end of the reporting period.
Riggs Small Company Stock Fund
As the most aggressive fund in the Riggs family, the fund invests in carefully
selected stocks issued by small companies.+ Small-company stocks continued to
show weakness during the period. Reflecting the decline in values among
small-company stocks, the total return for Class R Shares was (7.28%)** or
(9.13%)** adjusted for the fund's redemption fee. At the end of the reporting
period, fund assets totaled $32 million.
The past six-month reporting period was a weak one for stocks and bonds. Whether
you're a stock or bond investor, in times like these, it's particularly
important to keep focused on the long-term--which is the true measure of total
return performance. Of course, if you're a money market fund investor, your
outlook is considerably shorter--your money is at work earning daily income and
ready whenever you need it.
However near or far your financial goals are, thank you for selecting one or
more Riggs Funds. We'll continue to keep you up-to-date on your progress.
Sincerely,
/s/Edward C. Gonzales
Edward C. Gonzales
President
December 15, 1999
* An investment in the Money Market funds is neither insured nor guaranteed by
the Federal Deposit Insurance Corporation or any other government agency.
Although Money Market funds seek to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the funds.
** Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
+ Small cap stocks have historically experienced greater volatility than
average.
INVESTMENT REVIEW
Riggs U.S. Treasury Money Market Fund
Riggs Prime Money Market Fund
During this reporting period yields rose across the maturity spectrum. The yield
on the 3-month Treasury bill rose 55 basis points, while the yields on the
6-month and one year Treasury bills rose 65 basis points. The spread between the
3-month and one year Treasury bill widened from 21 to 32 basis points.
Commercial paper rates also were up, particularly in the 90-day and longer area
of the curve. The bond market in 1999 has experienced eight consecutive down
months and this year will likely be the second worst bear market for bonds in 50
years. Meanwhile, the core rate of inflation remains relatively low although the
bond market will be watching for any evidence of acceleration by monitoring
indicators such as Gross Domestic Product ("GDP"), employment and productivity
growth.
The Federal Reserve Board (the "Fed") tightened monetary policy two times in
June and August 1999 by a total of 50 basis points, raising the Federal Funds
Rate from 4.75% to 5.25%. In early 2000, the Fed may resume its tightening if
core inflation begins to rise as a function of higher commodity and food prices
as well as a weaker dollar. As we move towards year-end there is uncertainty
surrounding Y2K and its effect on the markets, particularly in the short end.
Investors may seek additional liquidity in treasury and agency issues. We have
increased our holdings of Treasury bills maturing in early 2000 and we will
continue to take opportunities to move into other asset classes such as
commercial paper, short corporate and treasury securities when yields look
attractive relative to repurchase agreements.
Riggs U.S. Government Securities Fund
Throughout 1999, growth has been strong while core inflation has remained
relatively benign. Labor markets are tight, with unemployment at a 29-year low
of 4.1%, yet wage pressures have remained fairly tame. The lack of wage-driven
inflation is due in part to strong productivity growth (since 1997, productivity
has grown at an average annual rate of 2.6%, considerably higher then the
average rate of 1% during the 1970's and 1980's). Investment remains strong
while the "wealth effect" from the surging stock market continues to fuel
consumer confidence to high levels, as evidenced by strong retail and housing
sales. Foreign economies also appear to be recovering from the problems of
1997-98. As the economy continues its long expansion, the bond market remains
vigilant for any evidence of acceleration in the core inflation rate.
The Fed raised the Federal Funds Rate to 5.25% through two 25 basis point rate
increases on June 30 and August 24, 1999. Factors affecting the Fed's decision
to tighten credit included strong GDP growth--above 4% over the last three
years--and growing evidence of economic stabilization and growth in Asia and
Europe. Rates during this reporting period were higher across the board, while
the yield curve flattened amid expectations of further Fed tightening. The
spread between the 2-year Treasury and the 30-year Treasury narrowed from 59 to
36 basis points. A downward bias in fixed income markets throughout the year has
resulted in bonds closing down eight months in a row. It appears as though 1999
will be second only to 1994 as the worst bear market in 50 years.
We maintained our duration at slightly below the benchmark until the middle of
the second quarter when the 30-year Treasury breached a 6.00% yield. At that
point, we increased our duration to slightly above the benchmark by purchasing
Treasury and agency securities and we maintained this longer duration throughout
the third quarter. Looking forward, the market faces several major sources of
uncertainty including Y2K and the impending presidential election. In addition,
the economic expansion is currently in its ninth year and we need to closely
monitor growth and productivity levels as well as the dollar and commodity
prices. These factors could contribute to greater volatility in the bond market
over the next six to nine months.
* Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
Riggs Stock Fund
Riggs Small Company Stock Fund
For the first half of our fiscal year, the equity markets were in a corrective,
consolidating phase, yet ended the reporting period on an upbeat note. Strong
economic growth of 4.5% and low unemployment have yet to fuel the engines of
inflation which remain close to 40 year lows of 2.1%, as measured by the
Consumer Price Index ("CPI"). Corporate earnings growth has also remained strong
yet narrow, with the technology sector providing a majority of the increase.
During this reporting period, we saw a continuation of the narrowness of the
market itself, in other words, a few large stocks providing the major
contribution to overall market returns. This concentration of returns (mainly
from the technology sector) is close to a 20 year extreme. Twenty years ago the
energy sector dominated the equity market returns as the high price of oil
fueled a large capital spending cycle. Today, several factors have sparked a
major capital and consumer spending cycle in both hardware and software; Y2K
preparedness, the internet and the global competitive economy. It is our belief
that the market will broaden out to encompass other sectors. This is due to the
extremely high price-to-earnings multiples accorded to certain technology
companies and correspondingly low multiples found elsewhere.
For the six month reporting period ended October 31, 1999, the Class R shares of
the Riggs Stock Fund (the "Stock Fund") generated a total return of (7.55)%*
based on net asset value while the class R shares of the Riggs Small Company
Stock Fund (the "Small Company Fund") generated a total return of (7.28)%* based
on net asset value. Our investment philosophy in managing both equity funds is
to balance long-term valuation with the catalyst of short-term earnings
acceleration. We employ our methodology which we call value/momentum, by
initially analyzing four key factors: (1) relative valuation; (2) earnings
growth relative to the stock's price-to-earnings multiple; (3) consensus
earnings estimate revisions; and (4) relative price strength. For stocks scoring
highly in this process, we focus on the fundamental changes that management is
implementing within these companies to generate earnings growth. We then invest
in those companies in which we have the most confidence in management.
We maintain a broad diversification of stocks among industries. In the Stock
Fund, the largest sector exposure is in technology. IBM, Lucent Technology and
Apple Computer are some of the major holdings here. We are impressed with the
successful restructuring and new products that Steve Jobs has been able to bring
about at Apple Computer. Focusing on the consumer market with a facile, stylish
and powerful array of products has generated an acceleration of earnings. During
this reporting period we increased our sector weights in finance and consumer
cyclicals. Wells Fargo, Fannie Mae and Zion Bancorporation are new additions in
finance. The Gap, Circuit City, Dayton Hudson and Toys R Us are new additions in
the consumer cyclical sector.
In the Small Company Fund, the current valuation of this sector of the market is
still close to 30 year lows. We believe the opportunities are great as
confidence in earnings growth appears to be improving. Health care, consumer
service and technology are the largest sectors. Metamor Worldwide, Eclipsys and
LCC International are some of the leading stocks in these sectors. While we are
entering one of the longest stretches of equity market returns in history, we
are optimistic about the future. Moderate economic growth with low inflation
have colored the equity market canvas with brilliant pastels. We are mindful
that certain sectors of the market represent high optimism and high valuation
yet others represent low valuation and opportunities.
* Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
LAST MEETING OF SHAREHOLDERS
A Special Meeting for the shareholders of Riggs U.S. Treasury Money Market Fund
was held on June 30, 1999. On April 27, 1999, the record date for shareholders
voting at the meeting, there were 145,141,817 total outstanding shares. The
following items were considered by shareholders and the results of their voting
were as follows:
(1) Election of Trustees:
<TABLE>
<CAPTION>
Abstentions and Withheld Authority
Names For Against Broker Non-Votes To Vote
<S> <C> <C> <C> <C>
Thomas G. Bigley 76,162,803 60,060
Nicholas P. Constantakis 76,162,803 60,060
John F. Cunningham 76,162,833 60,030
J. Christopher Donahue 76,222,863 0
Charles F. Mansfield, Jr. 76,222,863 0
John E. Murray, Jr. 76,222,863 0
John S. Walsh 76,222,863 0
</TABLE>
1 The following Directors of the Trust continued their terms as Directors of
the Trust: John F. Donahue, Lawrence D. Ellis, and Marjorie P. Smuts.
(2) To ratify the selection of Ernst & Young as the Trust's Independent
Auditors.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
54,924,677 1,445,470 19,852,715
(3) To make changes to the Fund's fundamental investment policies.
a. To amend the Fund's fundamental investment policy regarding diversification.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
54,888,643 1,458,910 19,875,309 1
b. To amend the Fund's fundamental policy regarding borrowing money and issuing
senior securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
54,890,684 1,456,869 19,875,309 1
c. To amend the Fund's fundamental investment policy regarding investments in
real estate.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
54,915,172 1,481,504 19,826,186
d. To amend the Fund's fundamental investment policy regarding investments in
commodities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
52,919,528 3,487,506 19,815,828 1
e. To amend the Fund's fundamental investment policy regarding underwriting
securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
54,891,704 1,520,711 19,810,447 1
f. To amend the Fund's fundamental investment policy regarding lending by the
Fund.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
54,853,371 1,531,068 19,838,422 2
g. To amend the Fund's fundamental investment policy regarding concentration of
the Fund's investments in the securities of companies in the same industry.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
54,816,485 1,520,711 19,885,667
h. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding buying securities on margin.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
54,843,791 1,543,305 19,835,767
i. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding pledging assets.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
54,900,236 1,543,403 19,779,222
(4) To eliminate the Fund's fundamental investment policy on selling securities
short.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
56,291,105 154,885 19,776,872 1
LAST MEETING OF SHAREHOLDERS
A Special Meeting for the shareholders of Riggs Prime Money Market Fund was held
on June 15, 1999. On April 27, 1999, the record date for shareholders voting at
the meeting, there were 390,220,577 total outstanding shares. The following
items were considered by shareholders and the results of their voting were as
follows:
(1) Election of Trustees:
<TABLE>
<CAPTION>
Abstentions and Withheld Authority
Names For Against Broker Non-Votes To Vote
<S> <C> <C> <C> <C>
Thomas G. Bigley 202,443,919 1,774,311
Nicholas P. Constantakis 202,443,919 1,774,311
John F. Cunningham 202,443,919 1,774,311
J. Christopher Donahue 202,454,690 1,763,540
Charles F. Mansfield, Jr. 202,454,690 1,763,540
John E. Murray, Jr. 202,454,690 1,763,540
John S. Walsh 202,454,690 1,763,540
</TABLE>
1 The following Directors of the Trust continued their terms as Directors of the
Trust: John F. Donahue, Lawrence D. Ellis, and Marjorie P. Smuts.
(2) To ratify the selection of Ernst & Young as the Trust's Independent
Auditors.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
202,679,070 325,585 1,213,574
(3) To make changes to the Fund's fundamental investment policies.
a. To amend the Fund's fundamental investment policy regarding diversification.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
201,031,629 1,876,589 1,310,011 1
b. To amend the Fund's fundamental policy regarding borrowing money and issuing
senior securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
200,831,150 1,897,129 1,489,950 1
c. To amend the Fund's fundamental investment policy regarding investments in
real estate.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
200,935,362 1,965,023 1,317,845
d. To amend the Fund's fundamental investment policy regarding investments in
commodities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
200,727,701 2,168,979 1,321,549 1
e. To amend the Fund's fundamental investment policy regarding underwriting
securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
200,106,709 2,637,893 1,473,626 2
f. To amend the Fund's fundamental investment policy regarding lending by the
Fund.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
200,748,913 2,113,523 1,355,793 1
g. To amend the Fund's fundamental investment policy regarding concentration of
the Fund's investments in the securities of companies in the same industry.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
200,784,211 2,070,852 1,363,166 1
h. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding buying securities on margin.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
200,281,300 2,696,010 1,240,919 1
i. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding pledging assets.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
200,124,937 2,870,499 1,222,794
(4) To eliminate certain of the Fund's fundamental investment policies:
a. To remove the Fund's fundamental investment policy on selling securities
short.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
200,021,791 2,742,938 1,453,500 1
b. To remove the Fund's fundamental investment policy on investments in
restricted securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
200,127,966 2,774,407 1,301,976 13,881
LAST MEETING OF SHAREHOLDERS
A Special Meeting for the shareholders of Riggs U.S. Government Securities Fund
was held on June 15, 1999. On April 27, 1999, the record date for shareholders
voting at the meeting, there were 3,944,242 total outstanding shares. The
following items were considered by shareholders and the results of their voting
were as follows:
(1) Election of Trustees:
<TABLE>
<CAPTION>
Abstentions and Withheld Authority
Names For Against Broker Non-Votes To Vote
<S> <C> <C> <C> <C>
Thomas G. Bigley 3,054,094 302
Nicholas P. Constantakis 3,054,094 302
John F. Cunningham 3,054,094 302
J. Christopher Donahue 3,054,094 302
Charles F. Mansfield, Jr. 3,054,094 302
John E. Murray, Jr. 3,054,094 302
John S. Walsh 3,054,094 302
</TABLE>
1 The following Directors of the Trust continued their terms as Directors of the
Trust: John F. Donahue, Lawrence D. Ellis, and Marjorie P. Smuts.
(2) To ratify the selection of Ernst & Young as the Trust's Independent
Auditors.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,054,301 95
(3) To make changes to the Fund's fundamental investment policies.
a. To amend the Fund's fundamental investment policy regarding diversification.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,020,016 8,450 702 25,228
b. To amend the Fund's fundamental policy regarding borrowing money and issuing
senior securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,016,909 8,439 3,821 25,227
c. To amend the Fund's fundamental investment policy regarding investments in
real estate.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,016,909 11,558 702 25,227
d. To amend the Fund's fundamental investment policy regarding investments in
commodities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,020,028 9,141 25,227
e. To amend the Fund's fundamental investment policy regarding underwriting
securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,016,909 8,439 3,821 25,227
f. To amend the Fund's fundamental investment policy regarding lending by the
Fund.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,020,028 8,439 702 25,227
g. To amend the Fund's fundamental investment policy regarding concentration of
the Fund's investments in the securities of companies in the same industry.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,020,016 8,450 702 25,228
h. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding buying securities on margin.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,016,802 12,367 25,227
i. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding pledging assets.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,016,897 11,570 702 25,227
(4) To eliminate certain of the Fund's fundamental investment policies:
a. To remove the Fund's fundamental investment policy on selling securities
short.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,016,897 8,450 3,822 25,227
b. To remove the Fund's fundamental investment policy on investments in
restricted securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,016,897 8,450 3,822 25,227
LAST MEETING OF SHAREHOLDERS
A Special Meeting for the shareholders of Riggs Stock Fund was held on June 15,
1999. On April 27, 1999, the record date for shareholders voting at the meeting,
there were 6,433,566 total outstanding shares. The following items were
considered by shareholders and the results of their voting were as follows:
(1) Election of Trustees:
<TABLE>
<CAPTION>
Abstentions and Withheld Authority
Names For Against Broker Non-Votes To Vote
<S> <C> <C> <C> <C>
Thomas G. Bigley 3,833,572 1,455
Nicholas P. Constantakis 3,833,572 1,455
John F. Cunningham 3,833,572 1,455
J. Christopher Donahue 3,833,669 1,358
Charles F. Mansfield, Jr. 3,833,669 1,358
John E. Murray, Jr. 3,833,569 1,458
John S. Walsh 3,833,931 1,096
</TABLE>
1 The following Directors of the Trust continued their terms as Directors of the
Trust: John F. Donahue, Lawrence D. Ellis, and Marjorie P. Smuts.
(2) To ratify the selection of Ernst & Young as the Trust's Independent
Auditors.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,820,504 13,175 1,346
(3) To make changes to the Fund's fundamental investment policies.
a. To amend the Fund's fundamental investment policy regarding diversification.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,737,889 23,489 3,471 70,178
b. To amend the Fund's fundamental policy regarding borrowing money and issuing
senior securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,735,225 18,882 10,742 70,178
c. To amend the Fund's fundamental investment policy regarding investments in
real estate.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,742,616 18,594 3,640 70,177
d. To amend the Fund's fundamental investment policy regarding investments in
commodities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,732,214 29,164 3,471 70,178
e. To amend the Fund's fundamental investment policy regarding underwriting
securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,738,878 15,324 10,647 70,178
f. To amend the Fund's fundamental investment policy regarding lending by the
Fund.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,739,611 19,001 6,238 70,177
g. To amend the Fund's fundamental investment policy regarding concentration of
the Fund's investments in the securities of companies in the same industry.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,735,493 18,783 10,573 70,178
h. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding buying securities on margin.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,730,116 28,477 6,256 70,178
i. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding pledging assets.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,734,881 23,696 6,272 70,178
(4) To eliminate certain of the Fund's fundamental investment policies:
a. To remove the Fund's fundamental investment policy on selling securities
short.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,734,525 24,048 6,277 70,177
b. To remove the Fund's fundamental investment policy on investments in
restricted securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
3,734,892 23,700 6,258 70,177
LAST MEETING OF SHAREHOLDERS
A Special Meeting for the shareholders of Riggs Small Company Stock Fund was
held on June 15, 1999. On April 27, 1999, the record date for shareholders
voting at the meeting, there were 3,447,703 total outstanding shares. The
following items were considered by shareholders and the results of their voting
were as follows:
(1) Election of Trustees:
<TABLE>
<CAPTION>
Abstentions and Withheld Authority
Names For Against Broker Non-Votes To Vote
<S> <C> <C> <C> <C>
Thomas G. Bigley 2,705,055 1,067
Nicholas P. Constantakis 2,705,055 1,067
John F. Cunningham 2,705,055 1,067
J. Christopher Donahue 2,705,192 930
Charles F. Mansfield, Jr. 2,705,192 930
John E. Murray, Jr. 2,705,192 930
John S. Walsh 2,705,192 930
</TABLE>
1 The following Directors of the Trust continued their terms as Directors of the
Trust: John F. Donahue, Lawrence D. Ellis, and Marjorie P. Smuts.
(2) To ratify the selection of Ernst & Young as the Trust's Independent
Auditors.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,705,151 602 368
(3) To make changes to the Fund's fundamental investment policies.
a. To amend the Fund's fundamental investment policy regarding diversification.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,680,881 6,504 1,005 17,732
b. To amend the Fund's fundamental policy regarding borrowing money and issuing
senior securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,680,906 6,314 1,170 17,732
c. To amend the Fund's fundamental investment policy regarding investments in
real estate.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,681,961 5,423 1,005 17,733
d. To amend the Fund's fundamental investment policy regarding investments in
commodities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,677,800 9,584 1,005 17,733
e. To amend the Fund's fundamental investment policy regarding underwriting
securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,681,715 5,618 1,056 17,733
f. To amend the Fund's fundamental investment policy regarding lending by the
Fund.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,681,458 5,876 1,056 17,732
g. To amend the Fund's fundamental investment policy regarding concentration of
the Fund's investments in the securities of companies in the same industry.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,681,622 5,711 1,056 17,733
h. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding buying securities on margin.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,677,327 10,006 1,056 17,733
i. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding pledging assets.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,681,289 6,066 1,035 17,732
(4) To eliminate certain of the Fund's fundamental investment policies:
a. To remove the Fund's fundamental investment policy on selling securities
short.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,677,378 9,842 1,170 17,732
b. To remove the Fund's fundamental investment policy on investments in
restricted securities.
For Against Abstain Broker Non-Votes
- ---------- --------- ---------- -----------------
2,681,370 5,901 1,118 17,733
PORTFOLIO OF INVESTMENTS
Riggs U.S. Treasury Money Market Fund
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount
Value
<S>
<C>
U.S. Treasury Obligations--59.7%
U.S. Treasury Bills--19.0%
$ 5,000,000 (1)
1/6/2000 $ 4,957,934
5,000,000 (1)
2/10/2000 4,930,983
15,000,000 (1)
2/3/2000 14,812,020
Total 24,700,937
U.S. Treasury Notes--40.7%
14,400,000 (1) 5.375%,
1/31/2000 14,417,081
9,000,000 (1) 5.500%,
2/29/2000 9,017,673
10,000,000 5.500%,
5/31/2000 10,001,541
9,400,000 (1) 5.875%,
11/15/1999 9,404,113
10,000,000 5.875%,
2/15/2000 10,023,368
Total 52,863,776
Total U.S. Treasury
Obligations 77,564,713
(2) Repurchase Agreements--39.9%
17,254,000 Donaldson, Lufkin and Jenrette Securities Corp., 5.220%, dated 10/29/1999, due
11/1/1999 17,254,000
17,252,000 Paine Webber Inc., 5.190%, dated 10/29/1999, due
11/1/1999 17,252,000
17,254,000 Prudential Securities, Inc., 5.180%, dated 10/29/1999, due
11/1/1999 17,254,000
Total Repurchase
Agreements 51,760,000
Total Investments (at amortized
cost)(3) $129,324,713
</TABLE>
(1) Certain principal amounts on loan to broker.
(2) The repurchase agreements are fully collateralized by U.S. Treasury
obligations based on market prices at the date of the portfolio.
(3) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($129,822,457) at October 31, 1999.
(See Notes which are an integral part of the Financial Statements)
PORTFOLIO OF INVESTMENTS
Riggs Prime Money Market Fund
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
<S> <C>
Certificate Of Deposit--1.5%
$ 5,000,000 Canadian Imperial Bank of Commerce, NY,
5.150%, 2/23/2000 $ 4,999,537
Commercial Paper--9.9%
Finance--6.4%
8,000,000 Charta Corp., 10.868%, 12/6/1999 7,958,000
2,000,000 Chase Manhattan Corp., 7.757%, 11/1/1999 2,000,000
4,025,000 Fleet Boston Corp., 10.724%, 12/6/1999 4,004,143
8,000,000 Salomon Smith Barney Holdings, Inc.,
10.724%, 11/1/1999 8,000,000
Total 21,962,143
Finance-Automotive--0.6%
2,000,000 General Motors Acceptance Corp., 1994-A,
5.029%, 1/17/2000 2,005,988
Health Technology--2.9%
10,000,000 Altaire Pharmaceuticals, Inc., 10.816% -
10.829%, 11/2/1999 - 11/8/1999 9,994,033
Total Commercial Paper 33,962,164
Corporate Bonds--40.2%
Consumer Durables--1.6%
5,500,000 USL Capital Corp., 8.125%, 2/15/2000 5,542,058
Consumer Non-Durables--1.6%
4,500,000 PepsiCo, Inc., 6.375%, 12/31/1999 4,509,159
1,000,000 (1) PepsiCo, Inc., 6.800%, 5/15/2000 1,003,598
Total 5,512,757
Finance--30.0%
7,975,000 American General Finance Corp., 6.125%,
9/15/2000 7,963,181
1,000,000 American General Finance Corp., 6.875%,
1/15/2000 1,001,773
3,000,000 American General Finance Corp., 7.250%,
4/15/2000 3,017,115
5,000,000 Associates Corp. of North America,
8.250%, 12/1/1999 5,011,497
6,000,000 Associates Financial Services Co. of
Puerto Rico, Inc., (Guaranteed by
Associates Corp. of North America),
10.793%, 11/3/1999 5,998,223
1,500,000 Bear Stearns Cos., Inc., 5.150%,
4/20/2000 1,493,705
2,215,000 Bear Stearns Cos., Inc., 6.500%, 7/5/2000 2,219,173
2,000,000 Bear Stearns Cos., Inc., 6.560%,
6/20/2000 2,004,227
5,000,000 Beneficial Corp., 8.375%, 12/29/1999 5,025,637
9,550,000 Caterpillar Financial Services Corp.,
5.750%, 1/31/2000 9,545,614
1,000,000 CIT Group, Inc., 5.875%, 3/10/2000 999,947
1,000,000 CIT Group, Inc., 6.400%, 1/28/2000 1,001,228
6,500,000 CIT Group, Inc., 6.700%, 6/2/2000 6,525,610
4,000,000 Commercial Credit Co., 6.000%, 4/15/2000 4,000,114
5,000,000 Deere (John) Capital Corp., 7.370%,
3/22/2000 5,027,578
1,300,000 First National Bank of Commerce, 6.500%,
1/14/2000 1,302,256
1,670,000 Fleet Boston Corp., 8.625%, 12/15/1999 1,677,160
6,000,000 Household Finance Corp., 5.920%,
3/13/2000 5,998,994
3,620,000 Household Finance Corp., 6.000%, 5/8/2000 3,616,438
4,000,000 IBM Credit Corp., 5.065%, 4/12/2000 3,998,748
5,550,000 International Lease Finance Corp.,
5.750%, 12/15/1999 5,554,210
8,000,000 (1) International Lease Finance Corp.,
6.375%, 1/18/2000 8,016,926
1,500,000 International Lease Finance Corp.,
7.000%, 5/15/2000 1,508,275
2,550,000 Morgan Stanley, Dean Witter & Co.,
6.375%, 1/18/2000 2,556,437
3,615,000 Norwest Financial, Inc., 7.250%,
3/15/2000 3,637,912
3,000,000 Salomon, Inc., 6.500%, 3/1/2000 3,005,683
775,000 Travelers Group, Inc., 7.250%, 1/15/2000 778,138
Total 102,485,799
Finance-Automotive--4.1%
1,000,000 Chrysler Financial Co. L.L.C., 6.375%,
1/28/2000 1,001,061
1,100,000 Ford Motor Credit Corp., 6.375%,
4/15/2000 1,102,792
2,000,000 Ford Motor Credit Corp., 6.850%,
8/15/2000 2,009,593
3,797,000 Ford Motor Credit Corp., 8.375%,
1/15/2000 3,820,872
1,000,000 General Motors Acceptance Corp., 5.450%,
2/22/2000 999,375
3,210,000 General Motors Acceptance Corp., 6.250%,
1/6/2000 3,214,555
2,000,000 General Motors Acceptance Corp., 7.000%,
3/1/2000 2,011,537
Total 14,159,785
Health Technology--2.9%
9,800,000 American Home Products Corp., 7.700%,
2/15/2000 9,860,779
Total Corporate Bonds 137,561,178
Corporate Notes--3.2%
Finance--1.7%
4,000,000 Beneficial Corp., 7.990%, 2/16/2000 4,031,049
2,000,000 Morgan Stanley, Dean Witter & Co.,
6.250%, 3/15/2000 2,002,125
Total 6,033,174
Finance-Automotive--1.5%
5,000,000 Ford Motor Credit Corp., 8.625%,
1/24/2000 5,037,612
Total Corporate Notes 11,070,786
(2) Government Agencies--17.5%
Federal Farm Credit Bank--2.2%
7,475,000 Federal Farm Credit Bank, 5.560%,
1/18/2000 7,475,000
Federal Home Loan Bank System--3.9%
3,150,000 5.005%, 4/20/2000 3,145,065
5,000,000 5.686%, 1/28/2000 5,000,000
5,000,000 5.745%, 1/28/2000 4,999,843
Total 13,144,908
Federal Home Loan Mortgage Corp.--2.3%
8,000,000 5.000%, 1/10/2000 7,915,067
Federal National Mortgage
Association--0.3%
1,075,000 4.780%, 11/30/1999 1,074,366
Student Loan Marketing Association--8.8%
6,150,000 5.405%, 3/7/2001 6,107,824
5,000,000 5.415%, 12/16/1999 5,000,000
4,000,000 5.735%, 3/8/2000 4,001,476
10,000,000 5.795%, 1/12/2000 9,999,408
5,000,000 5.886%, 11/10/1999 5,000,060
Total 30,108,768
Total Government Agencies 59,718,109
(2) Notes - Variable--12.6%
Finance--11.1%
5,000,000 Allstate Life Insurance Co., 5.511%,
11/1/1999 5,000,000
13,000,000 IBM Credit Corp., 5.313%, 11/2/1999 13,000,024
10,000,000 Merrill Lynch & Co., Inc., 5.544%,
11/22/1999 10,000,629
10,000,000 Morgan Stanley, Dean Witter & Co.,
5.611%, 3/13/2001 10,000,000
Total 38,000,653
Finance-Insurance--1.5%
5,000,000 Allstate Life Insurance Co., GIC,
5.431%, 11/1/1999 5,000,000
Total Notes - Variable 43,000,653
U.S. Treasury Obligations--1.4%
5,000,000 (1) U.S. Treasury Bill, 5.000%, 1/6/2000 4,957,934
(3) Repurchase Agreements--12.7%
14,518,000 Donaldson, Lufkin and Jenrette
Securities Corp., 5.220%, dated
10/29/1999, due 11/1/1999 14,518,000
14,517,000 Paine Webber, Inc., 5.190%, dated
10/29/1999, due 11/1/1999 14,517,000
14,518,000 Prudential Securities, Inc., 5.180%,
dated 10/29/1999, due 11/1/1999 14,518,000
Total Repurchase Agreements 43,553,000
Total Investments (at amortized cost)(4) $338,823,361
</TABLE>
(1) Certain principal amounts on loan to broker. (2) Current rate and next reset
date shown.
(3) The repurchase agreements are fully collateralized by U.S. Treasury
obligations based on market prices at the date of the portfolio.
(4) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($342,034,883) at October 31, 1999.
The following acronym is used throughout this portfolio:
GIC--Guaranteed Investment Contract
(See Notes which are an integral part of the Financial Statements)
PORTFOLIO OF INVESTMENTS
Riggs U.S. Government Securities Fund
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
<S> <C>
Corporate Bond--2.8%
Finance--2.8%
$ 1,000,000 EQCC Home Equity Loan Trust 1997-3, $ 984,100
Class A8, 6.41%, 12/15/2004 (identified
cost $999,844)
Government Agencies--62.6%
Federal Home Loan Mortgage
Corporation--27.0%
9,700,000 (1) 5.75%, 7/15/2003 9,501,053
Federal National Mortgage
Association--16.7%
3,000,000 5.625%, 3/15/2001 2,984,580
888,000 6.00%, 5/15/2008 848,955
530,631 7.50%, 6/1/2012 537,099
1,000,000 8.50%, 2/1/2005 1,006,300
359,127 9.50%, 6/25/2018 380,700
136,455 9.50%, 7/25/2019 143,866
Total 5,901,500
Government National Mortgage
Association--18.9%
1,183,770 6.50%, 5/15/2028 1,131,613
1,951,627 7.00%, 8/15/2027 1,921,143
1,773,334 7.50%, 10/15/2027 1,778,317
1,772,817 8.00%, 10/15/2027 1,811,606
Total 6,642,679
Total Government Agencies 22,045,232
(identified cost $23,033,152)
U.S. Treasury Obligations--28.3%
U.S. Treasury Bonds--28.3%
3,550,000 6.125%, 11/15/2027 3,432,495
4,251,000 (1) 6.25%, 8/15/2023 4,162,962
2,350,000 (1) 6.50%, 11/15/2026 2,378,364
Total 9,973,821
U.S. Treasury Note--0.0%
1,000 6.50%, 5/15/2005 1,019
Total U.S. Treasury Obligations 9,974,840
(identified cost $10,410,069)
(2) Repurchase Agreement--5.3%
1,865,000 Donaldson, Lufkin and Jenrette 1,865,000
Securities Corp., 5.22%, dated
10/29/1999, due 11/1/1999 (at
amortized cost)
Total Investments (identified cost $ 34,869,172
$36,308,065)(3)
</TABLE>
(1) Certain principal amounts on loan to broker.
(2) The repurchase agreement is fully collateralized by U.S. Treasury
obligations based on market prices at the date of the portfolio.
(3) The cost of investments for federal tax purposes amounts to $36,308,065.
The net unrealized depreciation of investments on a federal tax basis
amounts to $1,438,893 which is comprised of $0 appreciation and $1,438,893
depreciation at October 31, 1999.
Note: The categories of investments are shown as a percentage of net assets
($35,200,837) at October 31, 1999.
(See Notes which are an integral part of the Financial Statements)
PORTFOLIO OF INVESTMENTS
Riggs Stock Fund
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Common Stocks--98.5%
Banking--0.9%
9,435 SouthTrust Corp. $ 384,588
5,372 Zions BanCorp 320,459
Total 705,047
Commercial Services--1.8%
27,190 Donnelley (R.R.) & Sons Co. 659,357
68,585 (1) Modis Professional Services, Inc. 767,295
Total 1,426,652
Consumer Durables--1.3%
15,094 Eastman Kodak Co. 1,040,543
Consumer Non-Durables--5.3%
29,265 Fort James Corp. 770,035
41,585 Philip Morris Cos., Inc. 1,047,422
31,670 (2) R.J.R. Nabisco, Inc., Class A 1,183,666
64,725 The Pepsi Bottling Group, Inc. 1,177,186
Total 4,178,309
Consumer Services--5.0%
78,685 (1) Cendant Corp. 1,298,302
43,645 Tribune Co. 2,618,700
Total 3,917,002
Electronic Technology--19.1%
21,165 (1) Apple Computer, Inc. 1,695,846
30,935 (1) Cisco Systems, Inc. 2,289,190
10,705 (1) EMC Corp. Mass 781,465
8,660 (1) General Instrument Corp. 466,016
16,480 Intel Corp. 1,276,170
16,116 International Business Machines Corp. 1,585,412
15,039 Koninklijke (Royal) Philips 1,563,116
Electronics NV, ADR
30,767 Lucent Technologies, Inc. 1,976,780
24,395 (1)(2) SCI Systems, Inc. 1,204,503
4,680 Texas Instruments, Inc. 420,030
28,220 United Technologies Corp. 1,707,310
Total 14,965,838
Energy Minerals--5.3%
28,305 BP Amoco PLC, ADR 1,634,614
17,770 Mobil Corp. 1,714,805
12,261 Texaco, Inc. 752,519
Total 4,101,938
Finance--16.6%
9,005 American Express Co. 1,386,770
29,112 Bank of America Corp 1,874,085
21,495 Federal National Mortgage Association 1,520,771
38,394 Fleet Boston Corp. 1,674,921
34,925 Hartford Financial Services Group, Inc. 1,809,552
18,490 Lincoln National Corp. 852,851
11,915 Merrill Lynch & Co., Inc. 935,328
44,880 Washington Mutual, Inc. 1,612,875
28,440 Wells Fargo Co. 1,361,565
Total 13,028,718
Health Services--1.3%
23,799 Cardinal Health, Inc. 1,026,332
Health Technology--8.2%
20,425 Abbott Laboratories 824,659
30,140 American Home Products Corp. 1,574,815
14,695 Baxter International, Inc. 953,338
35,549 (1) Elan Corp. Plc, ADR 915,387
20,755 Johnson & Johnson 2,174,086
Total 6,442,285
Industrial Services--1.4%
17,305 Schlumberger Ltd. 1,048,034
Producer Manufacturing--6.9%
18,049 Georgia-Pacific Corp. 716,320
20,671 Ingersoll-Rand Co. 1,080,060
20,235 Textron, Inc. 1,561,889
27,250 Tyco International Ltd. 1,088,297
32,789 Xerox Corp. 918,092
Total 5,364,658
Retail Trade--12.1%
24,141 Albertsons, Inc. 876,620
20,180 Circuit City Stores, Inc. 861,434
13,095 Dayton-Hudson Corp. 846,264
24,515 The Gap, Inc. 910,119
94,168 (1) Office Depot, Inc. 1,171,215
46,699 (1) Safeway, Inc. 1,649,058
31,725 Sears, Roebuck & Co. 894,248
51,770 TJX Cos., Inc. 1,404,261
62,780 (1) Toys `R' Us, Inc. 886,768
Total 9,499,987
Technology Services--1.3%
22,190 First Data Corp. 1,013,806
Utilities--12.0%
16,832 AT&T Corp. 786,896
27,405 Coastal Corp. 1,154,436
34,105 Edison International 1,010,361
22,027 GPU, Inc. 747,541
17,240 GTE Corp. 1,293,000
21,395 (1) MCI Worldcom, Inc. 1,835,958
30,445 Peco Energy Co. 1,162,618
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
<S> <C>
Common Stocks--continued
Utilities--continued
26,800 SBC Communications, Inc. $ 1,365,142
Total 9,355,952
Total Common Stocks (identified cost 77,115,101
$63,942,047)
Preferred Stocks--0.5%
Consumer Services--0.5%
14,382 Cendant Corp., Conv. Pfd., 7.50% 402,696
(identified cost $551,099)
(3) Repurchase Agreement--3.1%
$ 2,448,000 Donaldson, Lufkin and Jenrette 2,448,000
Securities Corp., 5.22%, dated
10/29/1999, due 11/1/1999 (at
amortized cost)
Total Investments (identified cost $ 79,965,797
</TABLE>
(1) Non-income producing security.
(2) Certain shares on loan to broker.
(3) The repurchase agreement is fully collateralized by U.S. Treasury
obligations based on market prices at the date of the portfolio.
(4) The cost of investments for federal tax purposes amounts to $66,941,146.
The net unrealized appreciation of investments on a federal tax basis
amounts to $13,024,651 which is comprised of $18,345,132 appreciation and
$5,320,481 depreciation at October 31, 1999.
Note: The categories of investments are shown as a percentage of net assets
($78,319,705) at October 31, 1999.
The following acronym is used throughout this portfolio:
ADR--American Depositary Receipt
(See Notes which are an integral part of the Financial Statements)
PORTFOLIO OF INVESTMENTS
Riggs Small Company Stock Fund
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Common Stocks--86.7%
Commercial Services--3.4%
19,335 (1) AHL Services, Inc. $ 367,365
37,660 (1) Modis Professional Services, Inc. 421,321
3,540 (1) NCO Group, Inc. 150,007
5,570 (1) Navigant Consulting, Inc. 159,093
Total 1,097,786
Consumer Durables--4.1%
36,266 (1)(2) Action Performance Cos., Inc. 737,786
20,859 (1) Furniture Brands International, Inc. 404,143
16,380 (1) Topps Co. 160,729
Total 1,302,658
Consumer Non-Durables--2.8%
47,338 (1) NBTY, Inc. 381,663
41,882 (1) Steven Madden Ltd. 513,054
Total 894,717
Consumer Services--8.2%
12,390 CBRL Group, Inc. 165,716
45,210 (1) Diedrich Coffee, Inc. 254,306
22,495 (1) Global Imaging Systems, Inc. 310,712
20,805 (1) Metamor Worldwide, Inc. 392,694
19,353 (1) Performance Food Group Co. 524,950
13,505 (1)(2) NetRadio Corp. 107,196
18,999 (1) Rare Hospitality International, Inc. 378,792
32,327 (1) ResortQuest International, Inc. 248,514
28,094 (1) Travel Services International, Inc. 245,822
Total 2,628,702
Electronic Technology--2.7%
28,919 (1) Aeroflex, Inc. 160,862
35,678 (1) Brooktrout, Inc. 461,584
4,788 (1) RadiSys Corp. 253,764
Total 876,210
Finance--18.8%
36,355 Advanta Corp., Class B 468,071
22,255 Allied Capital Corp. 446,491
8,000 (1) American Bancshares, Inc. 111,000
55,495 (1) Amresco, Inc. 163,016
14,336 (2) Apartment Investment & Management Co., 539,392
Class A
22,530 (1)(2) Creditrust Corp. 401,316
34,600 (1) FPIC Insurance Group, Inc. 549,275
22,250 First Industrial Realty Trust 549,297
33,045 (2) Gold Banc Corp., Inc. 349,038
16,690 Hudson United Bancorp 524,692
59,985 Imperial Credit Commercial Mortgage 652,337
Investment Corp.
40,485 (1) Rainbow Rentals, Inc. 359,304
10,050 Southwest Securities Group, Inc. 239,316
2,685 Sterling Bancorp 50,679
5,880 (1) Sun Bancorp, Inc. 60,638
14,272 Weingarten Realty Investors 545,904
Total 6,009,766
Health Services--11.4%
20,480 (1) Eclipsys Corp. 325,120
43,400 (1) First Consulting Group, Inc. 366,187
23,249 (1)(2) InfoCure Corp. 366,172
79,208 (1) InterDent, Inc. 653,466
24,190 (1) Pharmaceutical Product Development, Inc. 243,412
11,026 (1) Priority HealthCare Corp., Class B 221,209
23,626 (1) Trigon Healthcare, Inc. 670,388
51,284 (1) US Oncology, Inc. 229,175
34,442 (1) United Payors & United Providers, Inc. 579,056
Total 3,654,185
Health Technology--5.6%
20,155 (1) Cephalon, Inc. 327,519
20,380 (1) Colorado MEDtech, Inc. 264,940
10,996 Cooper Companies, Inc. 274,900
28,150 (1) Hanger Orthopedic Group, Inc. 346,597
23,222 (1) Maxxim Medical, Inc. 557,328
Total 1,771,284
Industrial Services--5.2%
49,320 (1) Group Maintenance America Corp. 474,705
33,842 (1)(2) National-Oilwell, Inc. 458,982
14,445 (1)(2) Precision Drilling Corp. 334,943
29,070 (1) Pride International, Inc. 399,713
Total 1,668,343
Non-Energy Minerals--0.8%
12,565 (1) Stillwater Mining Co. 252,871
Process Industries--1.3%
36,937 (1) Building One Services Corp. 410,924
Producer Manufacturing--1.0%
5,965 (1)(2) Zebra Technologies Corp., Class A 324,347
Retail Trade--4.3%
18,645 (1)(2) Buckle, Inc. 307,643
37,115 (1)(2) Rent-A-Center, Inc. 679,668
28,172 (1) White Cap Industries, Inc. 397,929
Total 1,385,240
Technology Services--7.2%
31,037 (1) Axent Technologies, Inc. 459,736
15,885 (1)(2) Navidec, Inc. 161,828
71,635 (1) Netplex Group, Inc. 134,316
29,505 (1) Novadigm, Inc. 385,409
65,235 (1) SOFTWORKS, Inc. 199,782
</TABLE>
<TABLE>
<CAPTION>
Shares or
Principal
Amount Value
<S> <C>
Common Stocks--continued
Technology Services--continued
7,704 (1) ScanSource, Inc. $ 260,973
38,568 (1) Symix Systems, Inc. 397,733
15,410 (1) Tech Data Corp. 289,901
Total 2,289,678
Transportation--7.2%
25,469 (1)(2) Atlantic Coast Airlines Holdings 592,154
9,770 (1) Landstar System, Inc. 395,685
53,950 (1) Mesa Air Group, Inc. 303,469
11,771 (1) Ryanair Holdings PLC, ADR 485,554
21,415 SkyWest, Inc. 531,360
Total 2,308,222
Utilities--2.7%
53,415 (1)(2) LCC International, Inc., Class A 454,028
17,495 Northwestern Corp. 399,105
Total 853,133
Total Common Stocks 27,728,066
(identified cost $30,464,400)
(3) Repurchase Agreement--12.4%
$ 3,948,000 Donaldson, Lufkin and Jenrette Securities 3,948,000
Corp., 5.22%, dated 10/29/1999, due
11/1/1999 (at amortized cost)
Total Investments (identified cost $ 31,676,066
$34,412,400)(4)
</TABLE>
(1) Non-income producing security.
(2) Certain shares on loan to broker.
(3) The repurchase agreement is fully collateralized by U.S. Treasury
obligations based on market prices at the date of the portfolio.
(4) The cost of investments for federal tax purposes amounts to $34,412,400.
The net unrealized depreciation of investments on a federal tax basis
amounts to $2,736,334 which is comprised of $2,363,998 appreciation and
$5,100,332 depreciation at October 31, 1999.
Note: The categories of investments are shown as a percentage of net assets
($31,973,670) at October 31, 1999.
The following acronym is used throughout this portfolio:
ADR--American Depositary Receipt
(See Notes which are an integral part of the Financial Statements)
STATEMENTS OF ASSETS AND LIABILITIES
Riggs Funds
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
U.S. Treasury Prime U.S. Government
Money Market Money Market Securities
Fund Fund Fund
<S> <C> <C> <C>
Assets:
Investments in securities, at value $ 77,564,713 $ 295,270,361 $ 33,004,172
Investments in repurchase agreements 51,760,000 43,553,000 1,865,000
Total investments, at amortized cost
and value 129,324,713 338,823,361 34,869,172
Cash 2,753 135,561 --
Collateral for securities loaned,
at fair value (Note 2) 54,168,749 5,733,300 6,606,013
Income receivable 983,876 4,422,443 511,889
Receivable for shares sold -- -- 1,000
Total assets 184,480,091 349,114,665 41,988,074
Liabilities:
Income distribution payable 488,885 1,344,418 157,579
Payable upon return of securities
loaned (Note 2) 54,168,749 5,733,300 6,606,013
Payable to Bank -- -- 1,398
Payable for shares redeemed -- -- 21,418
Accrued expenses -- 2,064 829
Total liabilities 54,657,634 7,079,782 6,787,237
Net Assets 129,822,457 $ 342,034,883 $ 35,200,837
Net Assets Consists of:
Paid in capital 129,822,457 $ 342,322,678 $ 38,651,520
Net unrealized appreciation
(depreciation) of investments -- -- (1,438,893)
Accumulated net realized gain
(loss) on investments -- (867,840) (2,060,447)
Accumulated undistributed net
investment income -- 580,045 48,657
Total Net Assets $ 129,822,457 $ 342,034,883 $ 35,200,837
Class Y Shares $ 125,771,272 $ 323,082,244 $ --
Class R Shares $ 4,051,185 $ 18,952,639 $ 35,200,837
Net Asset Value, Offering Price and
Redemption Proceeds Per Share:
Net Asset Value Per Share
Class Y Shares $1.00 $1.00 --
Class R Shares $1.00 $1.00 $9.54
Offering Price Per Share(1)
Class Y Shares $1.00 $1.00 --
Class R Shares $1.00 $1.00 $9.54(3)
Redemption Proceeds Per Share(2)
Class Y Shares $1.00 $1.00 --
Class R Shares $1.00 $1.00 $9.35(4)
Shares Outstanding:
Class Y Shares 125,771,272 323,366,868 --
Class R Shares 4,051,185 18,952,274 3,687,976
Investments, at identified cost $ 129,324,713 $ 338,823,361 $ 36,308,065
Investments, at tax cost $ 129,324,713 $ 338,823,361 $ 36,308,065
</TABLE>
(1) See "What Shares Cost" in the Prospectus.
(2) See "Contingent Deferred Sales Charge" in the Prospectus.
(3) Computation of offering price per share 100/100.00 of net asset value.
(4) Computation of offering price per share 98.00/100 of net asset value.
(See Notes which are an integral part of the Financial Statements)
Riggs Funds
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Small
Stock Company Stock
Fund Fund
<S> <C> <C>
Assets:
Investments in securities, at value $ 77,517,797 $ 27,728,066
Investments in repurchase agreements 2,448,000 3,948,000
Total investments, at amortized cost and value 79,965,797 31,676,066
Cash 9,147 2,593
Collateral for securities loaned, at fair value 1,436,655 4,822,791
(Note 2)
Income receivable 66,291 1,717
Receivable for shares sold -- 3,000
Receivable for investments sold -- 554,041
Deferred organizational costs -- 3,885
Other Assets -- 14,874
Total assets 81,477,890 37,078,967
Liabilities:
Income distribution payable 461 184
Payable for investments purchased 1,664,007 281,922
Payable upon return of securities loaned (Note 2) 1,436,655 4,822,791
Payable for shares redeemed 41,915 400
Accrued expenses 15,147 --
Total liabilities 3,158,185 5,105,297
Net Assets $ 78,319,705 $ 31,973,670
Net Assets Consists of:
Paid in capital $ 61,585,394 $ 39,009,580
Net unrealized appreciation (depreciation) of 13,024,651 (2,736,334)
investments
Accumulated net realized gain (loss) on 3,713,353 (4,185,487)
investments
Accumulated distributions in excess of net (3,693) --
investment income
Net operating loss -- (114,089)
Total Net Assets $ 78,319,705 $ 31,973,670
Class R Shares $ 77,953,107 $ 31,869,294
Class B Shares $ 366,598 $ $104,376
Net Asset Value, Offering Price and Redemption
Proceeds Per Share:
Net Asset Value Per Share
Class R Shares $13.13 $10.45
Class B Shares $13.07 $10.37
Offering Price Per Share(1)
Class R Shares $13.13(3) $10.45(3)
Class B Shares $13.07(3) $10.37(3)
Redemption Proceeds Per Share(2)
Class R Shares $12.87(4) $10.24(4)
Class B Shares $12.42(5) $9.85(5)
Shares Outstanding:
Class R Shares 5,935,269 3,051,081
Class B Shares 28,058 10,065
Investments, at identified cost $ 66,941,146 $ 34,412,400
Investments, at tax cost $ 66,941,146 $ 34,412,400
</TABLE>
(1) See "What Shares Cost" in the Prospectus.
(2) See "Contingent Deferred Sales Charge" in the Prospectus.
(3) Computation of offering price per share 100/100.00 of net asset value.
(4) Computation of offering price per share 98.00/100 of net asset value.
(5) Computation of offering price per share 95/100 of net asset value.
(See Notes which are an integral part of the Financial Statements)
STATEMENTS OF OPERATIONS
Riggs Funds
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
U.S.
U.S. Treasury Prime Government
Small Company
Money Market Money Market Securities
Stock Stock
Fund Fund Fund
Fund Fund
<S> <C> <C> <C> <C>
<C>
Investment Income:
Dividends $ -- $ -- $ -- $ 602,125
$ 108,155
Interest 3,504,020 9,182,628 1,155,291
67,618 76,179
Total investment income 3,504,020 9,182,628 1,155,291
669,743 184,334
Expenses:
Investment advisory fee 356,496 884,665 139,599
350,659 153,826
Administrative personnel
and
services fee 111,676 276,826 29,130
73,095 30,090
Custodian fees 14,260 35,387 3,723
9,351 3,846
Transfer and dividend
disbursing
agent fees and expenses 14,134 23,337 13,522
27,278 18,583
Trustees' fees 1,890 1,435 1,359
1,257 1,360
Auditing fees 7,064 7,792 7,792
5,768 8,087
Legal fees 1,425 1,489 1,403
1,257 1,413
Portfolio accounting fees 248 522 1,084
723 1,395
Distribution services fee--Class R Shares 8,919 36,798 46,533
116,568 47,931
Distribution services fee--Class B Shares -- -- --
954 419
Shareholder services fees--Class Y Shares 173,789 423,933 --
- -- --
Shareholder services fees--Class R Shares 4,459 18,399 46,533
116,568 47,931
Shareholder services fees--Class B Shares -- -- --
318 140
Share registration costs 12,395 15,873 7,423
10,223 4,262
Printing and postage 4,383 3,887 3,562
4,525 3,120
Insurance premiums 1,759 1,207 1,207
754 1,257
Miscellaneous 2,366 2,587 1,234
1,760 3,605
Total expenses 715,263 1,734,137 304,104
721,058 327,265
Waivers:
Waiver of investment advisory fee -- -- (74,453)
- -- --
Waiver of Distribution
services
fee--Class R Shares (4,459) (18,399) --
- -- --
Waiver of Shareholder
services
fee--Class Y Shares (173,789) (423,933) --
- -- --
Waiver of Shareholder
services
fee--Class R Shares (2,676) (11,039) (27,920)
(69,941) (28,758)
Waiver of Shareholder
services
fee--Class B Shares -- -- --
(191) (84)
Total waivers (180,924) (453,371) (102,373)
(70,132) (28,842)
Net expenses 534,339 1,280,766 201,731
650,926 298,423
Net investment income
(Net
operating loss) 2,969,681 7,901,862 953,560
18,817 (114,089)
Realized and Unrealized
Gain
(Loss) on
Investments:
Net realized gain (loss)
on
investments -- (451) (7,963)
4,186,714 574,336
Net change in
unrealized
appreciation
(depreciation)
of investments -- -- (1,148,720)
(11,422,818) (2,731,219)
Net realized and unrealized
loss
on investments -- (451) (1,156,683)
(7,236,104) (2,156,883)
Change in net assets
resulting
from operations $ 2,969,681 $ 7,901,411 $ (203,123) $(7,217,287)
$(2,270,972)
</TABLE>
(See Notes which are an integral part of the Financial Statements)
STATEMENTS OF CHANGES IN NET ASSETS
Riggs Funds
<TABLE>
<CAPTION>
U.S. Treasury Money Prime Money
U.S. Government
Market Fund Market Fund
Securities Fund
Six Months Six Months Six
Months
Ended Ended
Ended
(unaudited) Year Ended (unaudited) Year Ended
(unaudited) Year Ended
October 31, April 30, October 31, April 30, October
31, April 30,
1999 1999 1999 1999
1999 1999
<S> <C> <C> <C> <C>
<C> <C>
Increase (Decrease)
in
Net
Assets:
Operations--
Net investment income $ 2,969,681 $ 5,563,658 $ 7,901,862 $ 15,370,884 $
953,560 $ 1,893,617
Net realized
gain
(loss) in investments -- -- (451) 20,206
(7,963) 695,321
Net change in
unrealized
appreciation
(depreciation)
of investments -- -- -- --
(1,148,720) (498,899)
Change in net
assets
resulting from operations 2,969,681 5,563,658 7,901,411 15,391,090
(203,123) 2,090,039
Distributions to
Shareholders--
Distributions from net
investment
income
Class Y Shares (2,901,182) (5,454,096) (7,593,732) (15,228,454)
- -- --
Class R Shares (68,499) (109,562)(1) (308,130) (142,430)
(985,086) (1,847,619)
Change in net assets
resulting from distributions
to shareholders (2,969,681) (5,563,658) (7,901,862) (15,370,884)
(985,086) (1,847,619)
Share
Transactions--
Proceeds from sales of shares 109,145,740 275,302,536 617,096,434 1,459,921,511
5,317,758 10,292,077
Net asset value of shares
issued to shareholders
in payment of
distributions
declared 366,406 1,407,097 2,292,122 4,903,575
166,391 367,680
Cost of shares redeemed (121,096,125) (252,727,690) (710,828,466) (1,350,000,108)
(8,023,054) (6,526,922)
Change in net
assets
resulting from
share
transactions (11,583,979) 23,981,943 (91,439,910) 114,824,978
(2,538,905) 4,132,835
Change in net assets (11,583,979) 23,981,943 (91,440,361) 114,845,184
(3,727,114) 4,375,255
Net
Assets:
Beginning of period 141,406,436 117,424,493 433,475,244 318,630,060
38,927,951 34,552,696
End of period $ 129,822,457 $ 141,406,436 $ 342,034,883 $ 433,475,244 $
35,200,837 38,927,951
Undistributed net
investment
income included in net
assets at end of period -- -- $ 580,045 $ 580,045 $
48,657 $ 80,183
Net gain (loss) as computed
for federal tax purposes -- -- $ (451) $ 8,716 $
(7,963) $ 682,054
</TABLE>
(1) Reflects operations for the period from July 7, 1998 (date of initial public
investment) to April 30, 1999.
(See Notes which are an integral part of the Financial Statements)
Riggs Funds
<TABLE>
<CAPTION>
Small Company
Stock Fund Stock Fund
Six Months Six Months
Ended Ended
(unaudited) Year Ended (unaudited) Year
Ended
October 31, April 30, October 31, April
30,
1999 1999 1999 1999
<S> <C> <C> <C>
<C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income (net operating loss) $ 18,817 $ 262,526 $ (114,089) $
(60,901)
Net realized gain (loss) in investments 4,186,714 8,227,259 574,336
(4,753,762)
Net change in unrealized appreciation
(depreciation) of investments (11,422,818) (3,149,465) (2,731,219)
(11,661,505)
Change in net assets resulting
from operations (7,217,287) 5,340,320 (2,270,972)
(16,476,168)
Distributions to Shareholders--
Distributions from net investment income
Class R Shares (59,243) (292,776) --
- --
Class B Shares -- (57)(2) --
- --
Distributions from net realized gains
Class R Shares (8,502,330) (10,140,817) --
(5,407,163)
Class B Shares (28,707) (11,768)(2) --
(18,999)(3)
Change in net assets resulting from
distributions to shareholders (8,590,280) (10,445,418) --
(5,426,162)
Share Transactions--
Proceeds from sales of shares 7,062,727 23,801,961 4,495,004
23,672,150
Net asset value of shares issued to
shareholders in payment of
distributions declared 7,381,846 10,170,057 --
5,415,147
Cost of shares redeemed (21,973,908) (44,325,647) (9,079,081)
(26,579,582)
Change in net assets resulting
from share transactions (7,529,335) (10,353,629) (4,584,077)
2,507,715
Change in net assets (23,336,902) (15,458,727) (6,855,049)
(19,394,615)
Net Assets:
Beginning of period 101,656,607 117,115,334 38,828,719
58,223,334
End of period $ 78,319,705 $ 101,656,607 $ 31,973,670 $
38,828,719
Undistributed (distributions in
excess of/net operating loss)
net investment income included in net
assets at end of period $ (3,693) $ 36,733 $ (114,089)
- --
Net gain (loss) as computed for
federal tax purposes $ 4,186,714 $ 8,539,951 $ 574,336 $
(3,967,647)
</TABLE>
(2) Reflects operations for the period from July 19, 1998 (date of initial
public investment) to April 30, 1999.
(3) Reflects operations for the period from July 17, 1998 (date of initial
public investment) to April 30, 1999.
(See Notes which are an integral part of the Financial Statements)
FINANCIAL HIGHLIGHTS (unaudited)
Riggs Funds
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Net
Realized
Net
and
Net Asset Investment Unrealized Distribution
Distribution
Year Value, Income Gain Total From from net
from Net
Ended beginning (Operating (Loss) on Investment Investment
Realized Capital
April 30, of period Loss) Investments Operations Income
Gains Contribution
<S> <C> <C> <C> <C> <C>
<C> <C>
U.S. Treasury Money Market Fund
Y
Shares
1995 $1.00 0.04 -- 0.04 (0.04)
- -- --
1996 $1.00 0.05 -- 0.05 (0.05)
- -- --
1997 $1.00 0.05 -- 0.05 (0.05)
- -- --
1998 $1.00 0.05 -- 0.05 (0.05)
- -- --
1999 $1.00 0.04 -- 0.04 (0.04)
- -- --
1999(8) $1.00 0.02 -- 0.02 (0.02)
- -- --
U.S. Treasury Money Market Fund
R
Shares
1999(3) $1.00 0.03 -- 0.03 (0.03)
- -- --
1999(8) $1.00 0.02 -- 0.02 (0.02)
- -- --
Prime Money Market Fund Y Shares
1995 $1.00 0.047 (0.003) 0.044 (0.047)
- -- 0.003
1996 $1.00 0.05 -- 0.05 (0.05)
- -- --
1997 $1.00 0.05 -- 0.05 (0.05)
- -- --
1998 $1.00 0.05 -- 0.05 (0.05)
- -- --
1999 $1.00 0.05 -- 0.05 (0.05)
- -- --
1999(8) $1.00 0.02 -- 0.02 (0.02)
- -- --
Prime Money Market Fund R Shares
1996(6) $1.00 0.02 -- 0.02 (0.02)
- -- --
1997 $1.00 0.05 -- 0.05 (0.05)
- -- --
1998 $1.00 0.05 -- 0.05 (0.05)
- -- --
1999 $1.00 0.04 -- 0.04 (0.04)
- -- --
1999(8) $1.00 0.02 -- 0.02 (0.02)
- -- --
U.S. Government Securities Fund
R
Shares
1995 $9.46 0.56 (0.11) 0.45 (0.56)
- -- --
1996 $9.35 0.59 0.12 0.71 (0.59)
- -- --
1997 $9.47 0.60 (0.07) 0.53 (0.59)
- -- --
1998 $9.41 0.56 0.37 0.93 (0.57)
- -- --
1999 $9.77 0.52 0.06 0.58 (0.50)
- -- --
1999(8) $9.85 0.25 (0.30) (0.05) (0.26)
- -- --
Stock Fund R Shares
1995 $11.89 0.20 1.39 1.59 (0.19)
(0.60) --
1996 $12.69 0.18 4.00 4.18 (0.18)
(0.85) --
1997 $15.84 0.20 2.28 2.48 (0.20)
(2.71) --
1998 $15.41 0.11 5.20 5.31 (0.11)
(4.04) --
1999 $16.57 0.04 0.94 0.98 (0.04)
(1.71) --
1999(8) $15.80 0.00(9) (1.22) (1.22) (0.01)
(1.44) --
Small Company Stock Fund R
Shares
1995(7) $10.00 0.02 0.41 0.43 --
- -- --
1996 $10.43 (0.02) 4.05 4.03 (0.01)
(0.35) --
1997 $14.10 (0.01) (0.47) (0.48) --
(0.82) --
1998 $12.80 (0.04) 9.23 9.19 --
(3.19) --
1999 $18.80 (0.02) (5.66) (5.68) --
(1.85) --
1999(8) $11.27 (0.04) (0.78) (0.82) --
- -- --
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(2) During the period, certain fees were voluntarily waived. If such voluntary
waivers had not occurred, the ratios would have been as indicated.
(3) Reflects operations for the period from July 7, 1998 (date of initial public
investment) to April 30, 1999.
(4) Computed on an annualized basis.
(5) Total return would have remained at 4.84% absent the capital contribution by
Riggs National Corp.
<TABLE>
<CAPTION>
Ratios to Average Net Assets
Net
Investment
Net
Income
Investment (Operating Net
Assets,
Net Asset Income Expenses Loss) end
of
Total Value, end Total (Operating (after (after
period Portfolio
Distributions of period Return(1) Expenses(2) Loss)(2) waivers) waivers) (000
omitted) Turnover
<S> <C> <C> <C> <C> <C> <C>
<C> <C>
(0.04) $1.00 4.39% 0.80% 4.13% 0.60% 4.33%
$81,089 --
(0.05) $1.00 5.28% 0.78% 4.99% 0.60% 5.17%
$107,104 --
(0.05) $1.00 4.83% 0.70% 4.61% 0.57% 4.74%
$141,011 --
(0.05) $1.00 5.00% 0.71% 4.80% 0.63% 4.88%
$117,424 --
(0.04) $1.00 4.49% 0.97% 4.14% 0.72% 4.39%
$138,097 --
(0.02) $1.00 2.12% 0.99%(4) 3.92%(4) 0.74%(4) 4.17%(4)
$125,771 --
(0.03) $1.00 3.35% 1.55%(4) 3.39%(4) 1.08%(4) 3.86%(4)
$3,309 --
(0.02) $1.00 1.94% 1.49%(4) 3.44%(4) 1.09%(4) 3.84%(4)
$4,051 --
(0.044) $1.00 4.84%(5) 0.68% 4.48% 0.44% 4.72%
$284,059 --
(0.05) $1.00 5.50% 0.70% 5.07% 0.51% 5.26%
$367,742 --
(0.05) $1.00 5.09% 0.68% 4.83% 0.51% 5.00%
$372,037 --
(0.05) $1.00 5.22% 0.69% 5.00% 0.58% 5.11%
$318,122 --
(0.05) $1.00 4.76% 0.94% 4.40% 0.69% 4.65%
$425,054 --
(0.02) $1.00 2.27% 0.96%(4) 4.22%(4) 0.71%(4) 4.47%(4)
$323,082 --
(0.02) $1.00 0.74% 1.26%(4) 4.39%(4) 1.07%(4) 4.58%(4)
$10 --
(0.05) $1.00 4.57% 1.18% 4.41% 1.01% 4.58%
$26,263 --
(0.05) $1.00 4.92% 1.18% 4.33% 1.00% 4.51%
$508 --
(0.04) $1.00 4.49% 1.49% 3.79% 1.03% 4.25%
$8,422 --
(0.02) $1.00 2.09% 1.46%(4) 3.79%(4) 1.06%(4) 4.19%(4)
$18,953 --
(0.56) $9.35 5.01% 1.20% 5.66% 0.80% 6.06%
$46,820 262%
(0.59) $9.47 7.60% 1.20% 5.64% 0.80% 6.04%
$50,919 128%
(0.59) $9.41 5.79% 1.27% 5.96% 0.87% 6.36%
$31,829 171%
(0.57) $9.77 10.14% 1.22% 5.47% 0.82% 5.87%
$34,521 175%
(0.50) $9.85 6.03% 1.58% 4.45% 0.91% 5.12%
$38,928 55%
(0.26) $9.54 (0.54%) 1.63%(4) 4.56%(4) 1.08%(4) 5.11%(4)
$35,201 4%
(0.79) $12.69 14.16% 1.12% 1.52% 0.98% 1.66%
$66,019 46%
(1.03) $15.84 33.73% 1.08% 1.14% 0.96% 1.26%
$84,797 81%
(2.91) $15.41 16.34% 1.03% 1.14% 0.91% 1.26%
$89,142 75%
(4.15) $16.57 39.68% 1.00% 0.56% 0.93% 0.63%
$117,115 94%
(1.75) $15.80 6.50% 1.48% 0.00% 1.22% 0.26%
$101,474 52%
(1.45) $13.13 (7.55%) 1.54%(4) (0.11%)(4) 1.39%(4) 0.04%(4)
$77,953 21%
-- $10.43 4.30% 3.20%(4) (0.56%)(4) 1.66%(4) 0.98%(4)
$7,609 8%
(0.36) $14.10 39.43% 1.94% (0.93%) 1.14% (0.13%)
$19,289 70%
(0.82) $12.80 (3.76%) 1.46% (0.53%) 1.00% (0.07%)
$27,777 93%
(3.19) $18.80 77.85% 1.18% (0.35%) 1.09% (0.26%)
$58,223 108%
(1.85) $11.27 (30.33%) 1.63% (0.40%) 1.37% (0.14%)
$38,728 100%
-- $10.45 (7.28%) 1.70%(4) (0.74%)(4) 1.55%(4) (0.59%)(4)
$31,869 50%
</TABLE>
(6) Reflects operations for the period from December 12, 1995 (date of initial
public investment) to April 30, 1996.
(7) Reflects operations for the period from February 27, 1995 (date of initial
public investment) to April 30, 1995.
(8) For the six month period ended October 31, 1999 (unaudited).
(9) Amount represents less than $0.01 per share.
(See Notes which are an integral part of the Financial Statements)
COMBINED NOTES TO FINANCIAL STATEMENTS
Riggs Funds
October 31, 1999 (unaudited)
(1) Organization
Riggs Funds (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "Act"), as an open-end management investment company. The
Trust consists of five diversified portfolios (individually referred to as the
"Fund", or collectively as the "Funds") which are presented herein:
<TABLE>
<CAPTION>
Portfolio Name Investment Objective
<S> <C>
Riggs U.S. Treasury Money Market Fund Seeks to provide current income
("Treasury Fund") consistent with stability of
principal and liquidity.
Riggs Prime Money Market Fund Seeks to provide current income
("Prime Fund") consistent with stability of
principal and liquidity.
Riggs U.S. Government Securities Fund Seeks to achieve current income.
("U.S. Government Securities Fund")
Riggs Stock Fund Seeks to provide growth of capital ("Stock Fund") and income.
Riggs Small Company Stock Fund Seeks to provide long-term capital
("Small Company Fund") appreciation.
</TABLE>
The assets of each portfolio are segregated and a shareholder's interest is
limited to the portfolio in which shares are held.
(2) Significant Accounting Policies
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. These
policies are in conformity with generally accepted accounting principles.
Investment Valuations
U.S. government securities, listed corporate bonds (other fixed income and
asset-backed securities), and unlisted securities and private placement
securities are generally valued at the mean of the latest bid and asked price as
furnished by an independent pricing service. Listed equity securities (and
investments in closed-end investment companies) are valued at the last sale
price reported on a primary national securities exchange. For the money market
Funds within the Trust, the use of the amortized cost method to value portfolio
securities is in accordance with Rule 2a-7 under the Act. For fluctuating net
asset value Funds within the Trust, short-term securities are valued at the
prices provided by an independent pricing service. However, short-term
securities purchased with remaining maturities of sixty days or less may be
valued at amortized cost, which approximates fair market value.
Repurchase Agreements
It is the policy of the Funds to require the custodian bank to take possession,
to have legally segregated in the Federal Reserve Book Entry System, or to have
segregated within the custodian bank's vault, all securities held as collateral
under repurchase agreement transactions. Additionally, procedures have been
established by the Funds to monitor, on a daily basis, the market value of each
repurchase agreement's collateral to ensure that the value of collateral at
least equals the repurchase price to be paid under the repurchase agreement
transaction.
The Funds will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed by
the Funds' adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the "Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Funds could receive less
than the repurchase price on the sale of collateral securities.
Investment Income, Expenses and Distributions
Interest income and expenses are accrued daily. Bond premium and discount, if
applicable, are amortized as required by the Internal Revenue Code, as amended
(the "Code"). Dividend income and distributions to shareholders are recorded on
the ex-dividend date.
Federal Taxes
It is the Funds' policy to comply with the provisions of the Code applicable to
regulated investment companies and to distribute to shareholders each year
substantially all of their income. Accordingly, no provisions for federal tax
are necessary.
At April 30, 1999, the Prime Fund, U.S. Government Securities Fund and Small
Company Fund, for federal tax purposes, had a capital loss carryforward of
$867,389, $2,051,149, and $3,967,647, respectively, which will reduce each
Fund's taxable income arising from future net realized gains on investments, if
any, to the extent permitted by the Code, and thus will reduce the amount of the
distributions to shareholders which would otherwise be necessary to relieve the
Prime Fund, U.S. Government Securities Fund and Small Company Fund of any
liability for federal tax. Pursuant to the Code, such capital loss carryforward
of the Prime Fund will expire 2002 ($828,203), 2003 ($20,474), 2005 ($14,610),
and 2006 ($4,102). The capital loss carryforward of the U.S. Government
Securities Fund will expire 2003 ($1,580,823), and 2005 ($470,326). The capital
loss carryforward of the Small Company Fund will expire in 2006.
When-Issued and Delayed Delivery Transactions
The Funds may engage in when-issued or delayed delivery transactions. The Funds
record when-issued securities on the trade date and maintain security positions
such that sufficient liquid assets will be available to make payment for the
securities purchased. Securities purchased on a when-issued or delayed delivery
basis are marked to market daily and begin earning interest on the settlement
date.
Securities Lending
Under guidelines adopted by the Board of Trustees, each Fund may lend portfolio
securities to brokers/dealers and other financial organizations in order to
generate additional income. Loans of portfolio securities by a Fund will be
collateralized by cash, letters of credit or U.S. government securities which
are maintained at 100% of the current market value of the loaned securities.
Collateral is either held as cash or reinvested in short-term securities
including overnight repurchase agreements, commercial paper, master notes,
floating rate corporate notes (with at least quarterly reset rates) and money
market funds. The Funds return a portion of the interest on any cash received as
collateral and continue to receive interest or dividends on securities loaned.
Included in interest income is $28,092, $3,024, $2,649, $1,738, and $8,582 for
Treasury Fund, Prime Fund, U.S. Government Securities Fund, Stock Fund and Small
Company Fund, respectively, of income earned on securities lending transactions.
Loans will be made to firms deemed by the Company's advisor to be of good
financial standing and will not be made unless, in the judgement of the
Company's adviser, the consideration to be earned from such loans would justify
the risk. The risks associated with lending portfolio securities consist of
possible decline in value of collateral, possible delays receiving additional
collateral or in the recovery of the loaned securities or expenses from
enforcing the Funds' rights should the borrower of the securities fail
financially.
As of October 31, 1999, the value of securities loaned and the payable on
collateral due to broker were as follows:
<TABLE>
<CAPTION>
Market Value of Payable on
Securities Collateral
Fund Loaned Due Broker
<S> <C> <C>
Treasury Fund $53,280,878 $54,168,749
Prime Fund $ 5,625,742 $ 5,733,300
U.S. Government Securities Fund $ 6,433,306 $ 6,606,013
Stock Fund $ 1,441,834 $ 1,436,655
Small Company Fund $ 4,705,067 $ 4,822,791
</TABLE>
Cash collateral is held in a segregated account.
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 amounts of assets, liabilities, expenses and revenues reported in the
financial statements. Actual results could differ from those estimated.
Other
Investment transactions are accounted for on the trade date.
(3) Shares of Beneficial Interest
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in shares were as follows:
Riggs Funds
<TABLE>
<CAPTION>
Treasury Fund
Six Months
Ended Year Ended
Class Y Shares October 31, 1999 April 30, 1999
<S> <C>
<C>
Shares sold 107,664,245 268,593,093
Shares issued to shareholders in payment of
distributions declared 311,053 1,297,638
Shares redeemed (120,301,128) (249,218,122)
Net change resulting from Class Y Shares transactions (12,325,830) 20,672,609
</TABLE>
<TABLE>
<CAPTION>
Treasury Fund
Six Months
Ended Year Ended
Class R Shares October 31, 1999 April 30, 1999(1)
<S> <C>
<C>
Shares sold 1,481,495 6,709,443
Shares issued to shareholders in payment of
distributions declared 55,353 109,459
Shares redeemed (794,997) (3,509,568)
Net change resulting from Class R Shares transactions 741,851 3,309,334
Net change resulting from share transactions (11,583,979) 23,981,943
</TABLE>
<TABLE>
<CAPTION>
Prime Fund
Six Months
Ended Year Ended
Class Y Shares October 31, 1999 April 30, 1999
<S> <C> <C>
Shares sold 590,035,761 1,431,651,736
Shares issued to shareholders in payment of
distributions declared 2,052,971 4,766,066
Shares redeemed (694,059,754) (1,329,505,824)
Net change resulting from Class Y Shares transactions (101,971,022) 106,911,978
</TABLE>
<TABLE>
<CAPTION>
Prime Fund
Six Months
Ended Year Ended
Class R Shares October 31, 1999 April 30, 1999
<S> <C> <C>
Shares sold 27,060,673 28,269,775
Shares issued to shareholders in payment of
distributions declared 239,151 137,509
Shares redeemed (16,768,712) (20,494,284)
Net change resulting from Class R Shares transactions 10,531,112 7,913,000
Net change resulting from share transactions (91,439,910) 114,824,978
</TABLE>
<TABLE>
<CAPTION>
U.S. Government Securities Fund
Six Months
Ended Year Ended
Class R Shares October 31, 1999 April 30, 1999
<S> <C> <C>
Shares sold 553,975 1,031,656
Shares issued to shareholders in payment of
distributions declared 17,309 36,800
Shares redeemed (834,601) (653,284)
Net change resulting from Class R Shares transactions (263,317) 415,172
</TABLE>
<TABLE>
<CAPTION>
Stock Fund
Six Months Ended Year Ended
October 31, 1999 April 30, 1999
Class R Shares Amount Shares Amount Shares
<S> <C> <C> <C> <C>
Shares sold $ 6,856,477 456,027 $ 23,625,339 1,542,657
Shares issued to shareholders in
payment of distributions declared 7,353,256 572,084 10,158,300 676,733
Shares redeemed (21,972,074) (1,513,863) (44,312,176) (2,867,893)
Net change resulting from
Class R Shares transactions $ (7,762,341) (485,752) $(10,528,537) (648,503)
</TABLE>
(1) Reflects operations for the period from July 7, 1998 (date of initial
public investment) to April 30, 1999.
Riggs Funds
<TABLE>
<CAPTION>
Stock Fund
Six Months Ended Period Ended
October 31, 1999 April 30, 1999(2)
Class B Shares Amount Shares Amount Shares
<S> <C> <C> <C> <C>
Shares sold $ 206,250 14,368 $ 176,622 11,692
Shares issued to shareholders in
payment of distributions declared 28,590 2,241 11,757 785
Shares redeemed (1,834) (137) (13,471) (891)
Net change resulting from
Class B Shares transactions $ 233,006 16,472 $ 174,908 11,586
Net change resulting from $(7,529,335) (469,280) $(10,353,629) (636,917)
shares transactions
</TABLE>
<TABLE>
<CAPTION>
Small Company Fund
Six Months Ended Period Ended
October 31, 1999 April 30, 1999
Class R Shares Amount Shares Amount Shares
<S> <C> <C> <C> <C>
Shares sold $ 4,481,039 380,151 $ 23,513,675 1,811,335
Shares issued to shareholders in
payment of distributions declared -- -- 5,396,154 472,104
Shares redeemed (9,077,779) (766,731) (26,536,536) (1,942,196)
Net change resulting from
Class R Shares transactions $(4,596,740) (386,580) $ 2,373,293 341,243
</TABLE>
<TABLE>
<CAPTION>
Small Company Fund
Six Months Ended Period Ended
October 31, 1999 April 30, 1999(3)
Class B Shares Amount Shares Amount Shares
<S> <C> <C> <C> <C>
Shares sold $ 13,965 1,157 $ 158,475 11,167
Shares issued to shareholders in
payment of distributions declared -- -- 18,993 1,668
Shares redeemed (1,302) (104) (43,046) (3,822)
Net change resulting from
Class B Shares transactions $ 12,663 1,053 $ 134,422 9,013
Net change resulting from
transactions $(4,584,077) (385,527) $2,507,715 350,256
</TABLE>
(2) Reflects operations for the period from July 19, 1998 (date of initial
public investment) to April 30, 1999.
(3) Reflects operations for the period from July 17, 1998 (date of initial
public investment) to April 30, 1999.
(4) Investment Advisory Fee and Other Transactions with Affiliates
Investment Advisory Fee
Riggs Investment Management Corp., the Trust's investment adviser (the
"Adviser"), receives for its services an annual investment advisory fee based on
a percentage of each Fund's average daily net assets (see below). The Adviser
may voluntarily choose to waive a portion of its fee. The Adviser can modify or
terminate this voluntary waiver at any time at its sole discretion.
<TABLE>
<CAPTION>
Fund Annual Rate
<S> <C>
Treasury Fund 0.50%
Prime Fund 0.50%
U.S. Government Securities Fund 0.75%
Stock Fund 0.75%
Small Company Fund 0.80%
</TABLE>
Administrative Fee
Federated Administrative Services ("FAS") provides the Trust with certain
administrative personnel and services (including certain legal, fund accounting
and transfer agency services). The FAS fee is based on the level of average
aggregate net assets of the Trust for the period.
Distribution Services Fee
The Funds have adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1
under the Act. Under the terms of the Plan, the Fund will compensate Federated
Securities Corp. ("FSC"), the principal distributor, from the net assets of the
fund to finance activities intended to result in the sale of the Fund's Class R
and Class B Shares. The Plan provides that the Funds may incur distribution
expenses according to the following schedule annually, to compensate FSC. FSC
may voluntarily choose to waive any portion of its fee. FSC can modify or
terminate this voluntary waiver at any time at its sole discretion.
<TABLE>
<CAPTION>
Percentage of Average
Share Class Name Net Assets of Class
<S> <C>
Class R Shares 0.25%
Class B Shares 0.75%
</TABLE>
The Class R Shares of the Money Market Funds may pay the distributor a fee
computed at an annual rate of up to 0.50% of the average daily net assets.
Shareholder Services Fee
Under the terms of a Shareholder Services Agreement with FAS each Fund pays up
to 0.25% of average daily net assets of the Fund for the period. The fee is paid
to FAS to finance certain services for shareholders and to maintain shareholder
accounts. FAS may voluntarily choose to waive any portion of its fee. FSC can
modify or terminate this voluntary waiver at any time at its sole discretion.
Custodian Fees
Riggs Bank N.A. is the Fund's custodian. The fee is based on the level of each
Fund's average daily net assets for the period, plus out-of-pocket expenses.
Organizational Expenses
Organizational expenses were borne initially by FAS. The Funds have agreed to
reimburse FAS for the organizational expenses during the five year period
following each Fund's effective date. For the six months ended October 31, 1999,
the following amounts were paid pursuant to this agreement:
<TABLE>
<CAPTION>
Organizational Expenses
Organizational Paid for the Six Months
Fund Effective Date Expenses Ended October 31, 1999
<S> <C> <C> <C>
Small Company Fund February 6, 1995 $22,693 $2,269
</TABLE>
General
Certain of the Officers and Trustees of the Trust are Officers and Directors or
Trustees of the above companies.
(5) Investment Transactions
Purchases and sales of investments, excluding short-term obligations, for the
six months ended October 31, 1999, were as follows:
<TABLE>
<CAPTION>
Fund Purchases Sales
<S> <C> <C>
U.S. Government Securities Fund $ 3,005,156 $ 1,339,228
Stock Fund 19,124,677 33,858,956
Small Company Fund 17,669,457 24,185,716
</TABLE>
(6) Subsequent Event
On December 17, 1999, the Trust will add four portfolios to the Riggs Funds
Family: Riggs Large Cap Growth Fund (Class R and Class B Shares), Riggs Bond
Fund (Class R Shares), Riggs Intermediate Tax Free Bond Fund (Class R Shares),
and Riggs Long Term Tax Free Bond Fund (Class R Shares).
(7) Year 2000
Similar to other financial organizations, the Funds could be adversely affected
if the computer systems used by the Fund's service providers do not properly
process and calculate date-related information and data from and after January
1, 2000. The Fund's Adviser and administrator are taking measures that they
believe are reasonably designed to address the Year 2000 issue with respect to
computer systems that they use and to obtain reasonable assurances that
comparable steps are being taken by each of the Fund's other service providers.
At this time, however, there can be no assurance that these steps will be
sufficient to avoid any adverse impact to the Funds.
<TABLE>
<CAPTION>
TRUSTEES OFFICERS
<S> <C>
John F. Donahue John F. Donahue
Chairman
Thomas G. Bigley
Edward C. Gonzales
John T. Conroy, Jr. President and Treasurer
Nicholas P. Constantakis J. Christopher Donahue
Executive Vice President
John F. Cunningham
John W. McGonigle
J. Christopher Donahue Executive Vice President and Secretary
Lawrence D. Ellis, M.D. Joseph S. Machi
Vice President and Assistant Treasurer
Peter E. Madden
Richard B. Fisher
Charles F. Mansfield, Jr. Vice President
John E. Murray, Jr. C. Grant Anderson
Assistant Secretary
Marjorie P. Smuts
John S. Walsh
</TABLE>
Mutual funds are not bank deposits or obligations, are not guaranteed by any
bank, and are not insured or guaranteed by the U.S. government, the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in mutual funds involves risk, including possible
loss of principal.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by the Funds' prospectus which contains facts concerning
the Funds' objectives and policies, management fees, expenses and other
information.
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1111202A (12/99)
Combined Semi-Annual
Report To Shareholders
October 31, 1999
- -------------------------
Class B Shares
Riggs Stock Fund
Riggs Small Company Stock Fund
[LOGO OF RIGGS FUNDS]
Mutual funds are not FDIC insured and are not deposits or obligations of or
guaranteed by Riggs Bank N.A. They involve investment risks, including the
possible loss of the principal amount invested.
Federated Securities Corp., Distributor
- --------------------------------------------------------------------------------
PRESIDENT'S MESSAGE
- --------------------------------------------------------------------------------
Dear Investor:
I am pleased to present the Semi-Annual Report for the Riggs Funds--Class B
Shares--for the first half of the funds' current fiscal year, which is the
six-month reporting period ending October 31, 1999. It begins with an investment
commentary by each portfolio manager, followed by a complete list of holdings
and the financial statements for the Riggs Stock Fund, and Riggs Small Company
Stock Fund.
The following highlights summarize fund performance over the six-month reporting
period:
Riggs Stock Fund
The six-month reporting period was a weak period for the U.S. stock market. As a
result, the fund's diversified portfolio of high-quality stocks--which included
many household names like American Express, AT&T, Intel, Johnson & Johnson,
Mobil, Sears, and Xerox --produced a negative total return. The Class B Shares
return was (7.57%)*, or (11.72%)* adjusted for the redemption fee, resulting
from a $2.66 decline in net asset value and a $1.44 per share capital gains
distribution. The fund's net assets totaled $78.3 million at the end of the
reporting period.
Riggs Small Company Stock Fund
As the most aggressive fund in the Riggs family, the fund invests in carefully
selected stocks issued by small companies.** Small-company stocks were
particularly impacted during the reporting period's stock market decline.
Reflecting the decline in values among small-company stocks, the Class B Shares
total return was (7.49%)*, or (12.12%)* adjusted for the redemption fee. At the
end of the reporting period, fund assets totaled $32 million.
The six-month reporting period proved to be a weak period for stock investors.
In times like these, it's particularly important to keep focused on the long-
term--which is the true measure of stock performance.
Thank you for selecting one or more Riggs Stock Funds to pursue your long-term
goals. We'll continue to keep you up-to-date on your progress.
Sincerely,
/s/ Edward C. Gonzales
Edward C. Gonzales
President
December 15, 1999
* Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
** Small cap stocks have historically experienced greater volatility than
average.
- --------------------------------------------------------------------------------
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
Riggs Stock Fund
Riggs Small Company Stock Fund
For the first half of our fiscal year, the equity markets were in a corrective,
consolidating phase, yet ended the reporting period on an upbeat note. Strong
economic growth of 4.5% and low unemployment have yet to fuel the engines of
inflation which remains close to 40 year lows of 2.1%, as measured by the
Consumer Price Index ("CPI"). Corporate earnings growth has also remained strong
yet narrow, with the technology sector providing a majority of the increase.
During this reporting period, we saw a continuation of the narrowness of the
market itself, in other words, a few large stocks providing the major
contribution to overall market returns. This concentration of returns (mainly
from the technology sector) is close to a 20 year extreme. Twenty years ago the
energy sector dominated the equity market returns as the high price of oil
fueled a large capital spending cycle. Today, several factors have sparked a
major capital and consumer spending cycle in both hardware and software; Y2K
preparedness, the internet and the global competitive economy. It is our belief
that the market will broaden out to encompass other sectors. This is due to the
extremely high price-to-earnings multiples accorded to certain technology
companies and correspondingly low multiples found elsewhere.
For the six month reporting period ended October 31, 1999, the Class B shares of
the Riggs Stock Fund (the "Stock Fund") generated a total return of (7.57)*
based on net asset value while the Class B shares of the Riggs Small Company
Stock Fund (the "Small Company Fund") generated a total return of (7.49)* based
on net asset value. Our investment philosophy in managing both equity funds is
to balance long-term valuation with the catalyst of short-term earnings
acceleration. We employ our methodology which we call value/momentum, by
initially analyzing four key factors: (1) relative valuation; (2) earnings
growth relative to the stock's price-to-earnings multiple; (3) consensus
earnings estimate revisions; and (4) relative price strength. For stocks scoring
highly in this process, we focus on the fundamental changes that management is
implementing within these companies to generate earnings growth. We then invest
in those companies in which we have the most confidence in management.
We maintain a broad diversification of stocks among industries. In the Stock
Fund, the largest sector exposure is in technology. IBM, Lucent Technology and
Apple Computer are some of the major holdings here. We are impressed with the
successful restructuring and new products that Steve Jobs has been able to bring
about at Apple Computer. Focusing on the consumer market with a facile, stylish
and powerful array of products has generated an acceleration of earnings. During
this reporting period we increased our sector weights in finance and consumer
cyclicals. Wells Fargo, Fannie Mae and Zion Bancorporation are new additions in
finance. The Gap, Circuit City, Dayton Hudson and Toys R Us are new additions in
the consumer cyclical sector.
In the Small Company Fund, the current valuation of this sector of the market is
still close to 30 year lows. We believe the opportunities are great as
confidence in earnings growth appears to be improving. Health care, consumer
service and technology are the largest sectors. Metamor Worldwide, Eclipsys and
LCC International are some of the leading stocks in these sectors. While we are
entering one of the longest stretches of equity market returns in history, we
are optimistic about the future. Moderate economic growth with low inflation
have colored the equity market canvas with brilliant pastels. We are mindful
that certain sectors of the market represent high optimism and high valuation
yet others represent low valuation and opportunities.
* Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed,
may be worth more or less than their original cost.
- --------------------------------------------------------------------------------
LAST MEETING OF SHAREHOLDERS
- --------------------------------------------------------------------------------
A Special Meeting for the shareholders of Riggs Stock Fund was held on June 15,
1999. On April 27, 1999, the record date for shareholders voting at the meeting,
there were 6,433,566 total outstanding shares. The following items were
considered by shareholders and the results of their voting were as follows:
(1) Election of Trustees:
<TABLE>
<CAPTION>
Abstentions and Withheld Authority
Names For Against Broker Non-Votes To Vote
- ------------------------- --------- ------- ---------------- ------------------
<S> <C> <C> <C> <C>
Thomas G. Bigley 3,833,572 1,455
Nicholas P. Constantakis 3,833,572 1,455
John F. Cunningham 3,833,572 1,455
J. Christopher Donahue 3,833,669 1,358
Charles F. Mansfield, Jr. 3,833,669 1,358
John E. Murray, Jr. 3,833,569 1,458
John S. Walsh 3,833,931 1,096
</TABLE>
1 The following Directors of the Trust continued their terms as Directors of
the Trust: John F. Donahue, Lawrence D. Ellis, and Marjorie P. Smuts.
(2) To ratify the selection of Ernst & Young as the Trust's Independent
Auditors.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,820,504 13,175 1,346
(3) To make changes to the Fund's fundamental investment policies.
a. To amend the Fund's fundamental investment policy regarding
diversification.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,737,889 23,489 3,471 70,178
b. To amend the Fund's fundamental policy regarding borrowing money and
issuing senior securities.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,735,225 18,882 10,742 70,178
c. To amend the Fund's fundamental investment policy regarding investments
in real estate.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,742,616 18,594 3,640 70,177
d. To amend the Fund's fundamental investment policy regarding investments
in commodities.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,732,214 29,164 3,471 70,178
e. To amend the Fund's fundamental investment policy regarding underwriting
securities.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,738,878 15,324 10,647 70,178
f. To amend the Fund's fundamental investment policy regarding lending by the
Fund.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,739,611 19,001 6,238 70,177
g. To amend the Fund's fundamental investment policy regarding concentration of
the Fund's investments in the securities of companies in the same industry.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,735,493 18,783 10,573 70,178
h. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding buying securities on margin.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,730,116 28,477 6,256 70,178
LAST MEETING OF SHAREHOLDERS--CONTINUED
i. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding pledging assets.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,734,881 23,696 6,272 70,178
(4) To eliminate certain of the Fund's fundamental investment policies:
a. To remove the Fund's fundamental investment policy on selling securities
short.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,734,525 24,048 6,277 70,177
b. To remove the Fund's fundamental investment policy on investments in
restricted securities.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
3,734,892 23,700 6,258 70,177
LAST MEETING OF SHAREHOLDERS
A Special Meeting for the shareholders of Riggs Small Company Stock Fund was
held on June 15, 1999. On April 27, 1999, the record date for shareholders
voting at the meeting, there were 3,447,703 total outstanding shares. The
following items were considered by shareholders and the results of their voting
were as follows:
(1) Election of Trustees:
<TABLE>
<CAPTION>
Abstentions and Withheld Authority
- -------------------------------------------------------------------------------------------------------
Names For Against Broker Non-Votes To Vote
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Thomas G. Bigley 2,705,055 1,067
- -------------------------------------------------------------------------------------------------------
Nicholas P. Constantakis 2,705,055 1,067
- -------------------------------------------------------------------------------------------------------
John F. Cunningham 2,705,055 1,067
- -------------------------------------------------------------------------------------------------------
J. Christopher Donahue 2,705,192 930
- -------------------------------------------------------------------------------------------------------
Charles F. Mansfield, Jr. 2,705,192 930
- -------------------------------------------------------------------------------------------------------
John E. Murray, Jr. 2,705,192 930
- -------------------------------------------------------------------------------------------------------
John S. Walsh 2,705,192 930
- -------------------------------------------------------------------------------------------------------
</TABLE>
1 The following Directors of the Trust continued their terms as Directors of
the Trust: John F. Donahue, Lawrence D. Ellis, and Marjorie P. Smuts.
(2) To ratify the selection of Ernst & Young as the Trust's Independent
Auditors.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,705,151 602 368
(3) To make changes to the Fund's fundamental investment policies.
a. To amend the Fund's fundamental investment policy regarding
diversification.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,680,881 6,504 1,005 17,732
b. To amend the Fund's fundamental policy regarding borrowing money and
issuing senior securities.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,680,906 6,314 1,170 17,732
c. To amend the Fund's fundamental investment policy regarding investments in
real estate.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,681,961 5,423 1,005 17,733
d. To amend the Fund's fundamental investment policy regarding investments in
commodities.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,677,800 9,584 1,005 17,733
e. To amend the Fund's fundamental investment policy regarding underwriting
securities.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,681,715 5,618 1,056 17,733
f. To amend the Fund's fundamental investment policy regarding lending by the
Fund.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,681,458 5,876 1,056 17,732
g. To amend the Fund's fundamental investment policy regarding concentration of
the Fund's investments in the securities of companies in the same industry.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,681,622 5,711 1,056 17,733
h. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding buying securities on margin.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,677,327 10,006 1,056 17,733
LAST MEETING OF SHAREHOLDERS--CONTINUED
i. To amend, and to make non-fundamental, the Fund's fundamental investment
policy regarding pledging assets.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,681,289 6,066 1,035 17,732
(4) To eliminate certain of the Fund's fundamental investment policies:
a. To remove the Fund's fundamental investment policy on selling securities
short.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,677,378 9,842 1,170 17,732
b. To remove the Fund's fundamental investment policy on investments in
restricted securities.
For Against Abstain Broker Non-Votes
- ---------- ------- ------- ----------------
2,681,370 5,901 1,118 17,733
PORTFOLIO OF INVESTMENTS
Riggs Stock Fund
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
Common Stocks--98.5%
Banking--0.9%
<C> <S> <C>
9,435 SouthTrust Corp. $ 384,588
5,372 Zions BanCorp 320,459
Total 705,047
Commercial Services--1.8%
27,190 Donnelley (R.R.) & Sons Co. 659,357
68,585 (1) Modis Professional Services, Inc. 767,295
Total 1,426,652
Consumer Durables--1.3%
15,094 Eastman Kodak Co. 1,040,543
Consumer Non-Durables--5.3%
29,265 Fort James Corp. 770,035
41,585 Philip Morris Cos., Inc. 1,047,422
31,670 (2) R.J.R. Nabisco, Inc., Class A 1,183,666
64,725 The Pepsi Bottling Group, Inc. 1,177,186
Total 4,178,309
Consumer Services--5.0%
78,685 (1) Cendant Corp. 1,298,302
43,645 Tribune Co. 2,618,700
Total 3,917,002
Electronic Technology--19.1%
21,165 (1) Apple Computer, Inc. 1,695,846
30,935 (1) Cisco Systems, Inc. 2,289,190
10,705 (1) EMC Corp. Mass 781,465
8,660 (1) General Instrument Corp. 466,016
16,480 Intel Corp. 1,276,170
16,116 International Business Machines Corp. 1,585,412
15,039 Koninklijke (Royal) Philips 1,563,116
Electronics NV, ADR
30,767 Lucent Technologies, Inc. 1,976,780
24,395 (1)(2) SCI Systems, Inc. 1,204,503
4,680 Texas Instruments, Inc. 420,030
28,220 United Technologies Corp. 1,707,310
Total 14,965,838
Energy Minerals--5.3%
28,305 BP Amoco PLC, ADR 1,634,614
17,770 Mobil Corp. 1,714,805
12,261 Texaco, Inc. 752,519
Total 4,101,938
Finance--16.6%
9,005 American Express Co. 1,386,770
29,112 Bank of America Corp 1,874,085
21,495 Federal National Mortgage Association 1,520,771
38,394 Fleet Boston Corp. 1,674,921
34,925 Hartford Financial Services Group, 1,809,552
Inc.
18,490 Lincoln National Corp. 852,851
11,915 Merrill Lynch & Co., Inc. 935,328
44,880 Washington Mutual, Inc. 1,612,875
28,440 Wells Fargo Co. 1,361,565
Total 13,028,718
Health Services--1.3%
23,799 Cardinal Health, Inc. 1,026,332
Health Technology--8.2%
20,425 Abbott Laboratories 824,659
30,140 American Home Products Corp. 1,574,815
14,695 Baxter International, Inc. 953,338
35,549 (1) Elan Corp. Plc, ADR 915,387
20,755 Johnson & Johnson 2,174,086
Total 6,442,285
Industrial Services--1.4%
17,305 Schlumberger Ltd. 1,048,034
Producer Manufacturing--6.9%
18,049 Georgia-Pacific Corp. 716,320
20,671 Ingersoll-Rand Co. 1,080,060
20,235 Textron, Inc. 1,561,889
27,250 Tyco International Ltd. 1,088,297
32,789 Xerox Corp. 918,092
Total 5,364,658
Retail Trade--12.1%
24,141 Albertsons, Inc. 876,620
20,180 Circuit City Stores, Inc. 861,434
13,095 Dayton-Hudson Corp. 846,264
24,515 The Gap, Inc. 910,119
94,168 (1) Office Depot, Inc. 1,171,215
46,699 (1) Safeway, Inc. 1,649,058
31,725 Sears, Roebuck & Co. 894,248
51,770 TJX Cos., Inc. 1,404,261
62,780 (1) Toys `R' Us, Inc. 886,768
Total 9,499,987
Technology Services--1.3%
22,190 First Data Corp. 1,013,806
Utilities--12.0%
16,832 AT&T Corp. 786,896
27,405 Coastal Corp. 1,154,436
34,105 Edison International 1,010,361
22,027 GPU, Inc. 747,541
17,240 GTE Corp. 1,293,000
21,395 (1) MCI Worldcom, Inc. 1,835,958
30,445 Peco Energy Co. 1,162,618
Shares or
Principal
Amount Value
Common Stocks--continued
Utilities--continued
26,800 SBC Communications, Inc. $ 1,365,142
Total 9,355,952
Total Common Stocks (identified cost 77,115,101
$63,942,047)
Preferred Stocks--0.5%
Consumer Services--0.5%
14,382 Cendant Corp., Conv. Pfd., 7.50% 402,696
(identified cost $551,099)
(3) Repurchase Agreement--3.1%
$2,448,000 Donaldson, Lufkin and Jenrette 2,448,000
Securities Corp., 5.22%, dated
10/29/1999, due 11/1/1999 (at
amortized cost)
Total Investments (identified cost $ 79,965,797
$66,941,146)(4)
</TABLE>
(1) Non-income producing security.
(2) Certain shares on loan to broker.
(3) The repurchase agreement is fully collateralized by U.S. Treasury
obligations based on market prices at the date of the portfolio.
(4) The cost of investments for federal tax purposes amounts to $66,941,146. The
net unrealized appreciation of investments on a federal tax basis amounts to
$13,024,651 which is comprised of $18,345,132 appreciation and $5,320,481
depreciation at October 31, 1999.
Note: The categories of investments are shown as a percentage of net assets
($78,319,705) at October 31, 1999.
The following acronym is used throughout this portfolio:
ADR--American Depositary Receipt
(See Notes which are an integral part of the Financial Statements)
PORTFOLIO OF INVESTMENTS
Riggs Small Company Stock Fund
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
Common Stocks--86.7%
Commercial Services--3.4%
<C> <S> <C>
19,335 (1) AHL Services, Inc. $ 367,365
37,660 (1) Modis Professional Services, Inc. 421,321
3,540 (1) NCO Group, Inc. 150,007
5,570 (1) Navigant Consulting, Inc. 159,093
Total 1,097,786
Consumer Durables--4.1%
36,266 (1)(2) Action Performance Cos., Inc. 737,786
20,859 (1) Furniture Brands International, 404,143
Inc.
16,380 (1) Topps Co. 160,729
Total 1,302,658
Consumer Non-Durables--2.8%
47,338 (1) NBTY, Inc. 381,663
41,882 (1) Steven Madden Ltd. 513,054
Total 894,717
Consumer Services--8.2%
12,390 CBRL Group, Inc. 165,716
45,210 (1) Diedrich Coffee, Inc. 254,306
22,495 (1) Global Imaging Systems, Inc. 310,712
20,805 (1) Metamor Worldwide, Inc. 392,694
19,353 (1) Performance Food Group Co. 524,950
13,505 (1)(2) NetRadio Corp. 107,196
18,999 (1) Rare Hospitality International, 378,792
Inc.
32,327 (1) ResortQuest International, Inc. 248,514
28,094 (1) Travel Services International, 245,822
Inc.
Total 2,628,702
Electronic Technology--2.7%
28,919 (1) Aeroflex, Inc. 160,862
35,678 (1) Brooktrout, Inc. 461,584
4,788 (1) RadiSys Corp. 253,764
Total 876,210
Finance--18.8%
36,355 Advanta Corp., Class B 468,071
22,255 Allied Capital Corp. 446,491
8,000 (1) American Bancshares, Inc. 111,000
55,495 (1) Amresco, Inc. 163,016
14,336 (2) Apartment Investment & Management 539,392
Co., Class A
22,530 (1)(2) Creditrust Corp. 401,316
34,600 (1) FPIC Insurance Group, Inc. 549,275
22,250 First Industrial Realty Trust 549,297
33,045 (2) Gold Banc Corp., Inc. 349,038
16,690 Hudson United Bancorp 524,692
59,985 Imperial Credit Commercial Mortgage 652,337
Investment Corp.
40,485 (1) Rainbow Rentals, Inc. 359,304
10,050 Southwest Securities Group, Inc. 239,316
Shares Value
Common Stocks--continued
Finance--continued
2,685 Sterling Bancorp $ 50,679
5,880 (1) Sun Bancorp, Inc. 60,638
14,272 Weingarten Realty Investors 545,904
Total 6,009,766
Health Services--11.4%
20,480 (1) Eclipsys Corp. 325,120
43,400 (1) First Consulting Group, Inc. 366,187
23,249 (1)(2) InfoCure Corp. 366,172
79,208 (1) InterDent, Inc. 653,466
24,190 (1) Pharmaceutical Product 243,412
Development, Inc.
11,026 (1) Priority HealthCare Corp., Class B 221,209
23,626 (1) Trigon Healthcare, Inc. 670,388
51,284 (1) US Oncology, Inc. 229,175
34,442 (1) United Payors & United Providers, 579,056
Inc.
Total 3,654,185
Health Technology--5.6%
20,155 (1) Cephalon, Inc. 327,519
20,380 (1) Colorado MEDtech, Inc. 264,940
10,996 Cooper Companies, Inc. 274,900
28,150 (1) Hanger Orthopedic Group, Inc. 346,597
23,222 (1) Maxxim Medical, Inc. 557,328
Total 1,771,284
Industrial Services--5.2%
49,320 (1) Group Maintenance America Corp. 474,705
33,842 (1)(2) National-Oilwell, Inc. 458,982
14,445 (1)(2) Precision Drilling Corp. 334,943
29,070 (1) Pride International, Inc. 399,713
Total 1,668,343
Non-Energy Minerals--0.8%
12,565 (1) Stillwater Mining Co. 252,871
Process Industries--1.3%
36,937 (1) Building One Services Corp. 410,924
Producer Manufacturing--1.0%
5,965 (1)(2) Zebra Technologies Corp., 324,347
Class A
Retail Trade--4.3%
18,645 (1)(2) Buckle, Inc. 307,643
37,115 (1)(2) Rent-A-Center, Inc. 679,668
28,172 (1) White Cap Industries, Inc. 397,929
Total 1,385,240
Technology Services--7.2%
31,037 (1) Axent Technologies, Inc. 459,736
15,885 (1)(2) Navidec, Inc. 161,828
71,635 (1) Netplex Group, Inc. 134,316
29,505 (1) Novadigm, Inc. 385,409
65,235 (1) SOFTWORKS, Inc. 199,782
7,704 (1) ScanSource, Inc. 260,973
Shares or
Principal
Amount Value
Common Stocks--continued
Technology Services--continued
38,568 (1) Symix Systems, Inc. $ 397,733
15,410 (1) Tech Data Corp. 289,901
Total 2,289,678
Transportation--7.2%
25,469 (1)(2) Atlantic Coast Airlines 592,154
Holdings
9,770 (1) Landstar System, Inc. 395,685
53,950 (1) Mesa Air Group, Inc. 303,469
11,771 (1) Ryanair Holdings PLC, ADR 485,554
21,415 SkyWest, Inc. 531,360
Total 2,308,222
Utilities--2.7%
53,415 (1)(2) LCC International, Inc., Class 454,028
A
17,495 Northwestern Corp. 399,105
Total 853,133
Total Common Stocks (identified cost 27,728,066
$30,464,400)
(3) Repurchase Agreement--12.4%
$3,948,000 Donaldson, Lufkin and Jenrette 3,948,000
Securities Corp., 5.22%, dated
10/29/1999, due 11/1/1999 (at
amortized cost)
Total Investments (identified cost $ 31,676,066
$34,412,400)(4)
</TABLE>
(1) Non-income producing security.
(2) Certain shares on loan to broker.
(3) The repurchase agreement is fully collateralized by U.S. Treasury
obligations based on market prices at the date of the portfolio.
(4) The cost of investments for federal tax purposes amounts to $34,412,400. The
net unrealized depreciation of investments on a federal tax basis amounts to
$2,736,334 which is comprised of $2,363,998 appreciation and $5,100,332
depreciation at October 31, 1999.
Note: The categories of investments are shown as a percentage of net assets
($31,973,670) at October 31, 1999.
The following acronym is used throughout this portfolio:
ADR--American Depositary Receipt
(See Notes which are an integral part of the Financial Statements)
STATEMENTS OF ASSETS AND LIABILITIES
Riggs Funds
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Small
Stock Company Stock
Fund Fund
<S> <C> <C>
Assets:
Investments in securities, at value $ 77,517,797 $ 27,728,066
Investments in repurchase agreements 2,448,000 3,948,000
Total investments, at amortized cost and value 79,965,797 31,676,066
Cash 9,147 2,593
Collateral for securities loaned, at fair value 1,436,655 4,822,791
(Note 2)
Income receivable 66,291 1,717
Receivable for shares sold -- 3,000
Receivable for investments sold -- 554,041
Deferred organizational costs -- 3,885
Other Assets -- 14,874
Total assets 81,477,890 37,078,967
Liabilities:
Income distribution payable 461 184
Payable for investments purchased 1,664,007 281,922
Payable upon return of securities loaned (Note 2) 1,436,655 4,822,791
Payable for shares redeemed 41,915 400
Accrued expenses 15,147 --
Total liabilities 3,158,185 5,105,297
Net Assets $ 78,319,705 $ 31,973,670
Net Assets Consists of:
Paid in capital $ 61,585,394 $ 39,009,580
Net unrealized appreciation (depreciation) of 13,024,651 (2,736,334)
investments
Accumulated net realized gain (loss) on investments 3,713,353 (4,185,487)
Accumulated distributions in excess of net (3,693) --
investment income
Net operating loss -- (114,089)
Total Net Assets $ 78,319,705 $ 31,973,670
Class R Shares $ 77,953,107 $ 31,869,294
Class B Shares $ 366,598 $ 104,376
Net Asset Value, Offering Price and Redemption
Proceeds Per Share:
Net Asset Value Per Share
Class R Shares $ 13.13 $ 10.45
Class B Shares $ 13.07 $ 10.37
Offering Price Per Share(1)
Class R Shares(3) $ 13.13 $ 10.45
Class B Shares(3) $ 13.07 $ 10.37
Redemption Proceeds Per Share(2)
Class R Shares(4) $ 12.87 $ 10.24
Class B Shares(5) $ 12.42 $ 9.85
Shares Outstanding:
Class R Shares 5,935,269 3,051,081
Class B Shares 28,058 10,065
Investments, at identified cost $ 66,941,146 $ 34,412,400
Investments, at tax cost $ 66,941,146 $ 34,412,400
</TABLE>
(1) See "What Shares Cost" in the Prospectus.
(2) See "Contingent Deferred Sales Charge" in the Prospectus.
(3) Computation of offering price per share 100/100.00 of net asset value.
(4) Computation of offering price per share 98/100 of net asset value.
(5) Computation of offering price per share 95/100 of net asset value.
(See Notes which are an integral part of the Financial Statements)
STATEMENTS OF OPERATIONS
Riggs Funds
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Small
Stock Company Stock
Fund Fund
<S> <C> <C>
Investment Income:
Dividends $ 602,125 $ 108,155
Interest 67,618 76,179
Total investment income 669,743 184,334
Expenses:
Investment advisory fee 350,659 153,826
Administrative personnel and services fee 73,095 30,090
Custodian fees 9,351 3,846
Transfer and dividend disbursing agent fees and expenses 27,278 18,583
Trustees' fees 1,257 1,360
Auditing fees 5,768 8,087
Legal fees 1,257 1,413
Portfolio accounting fees 723 1,395
Distribution services fee--Class R Shares 116,568 47,931
Distribution services fee--Class B Shares 954 419
Shareholder services fees--Class R Shares 116,568 47,931
Shareholder services fees--Class B Shares 318 140
Share registration costs 10,223 4,262
Printing and postage 4,525 3,120
Insurance premiums 754 1,257
Miscellaneous 1,760 3,605
Total expenses 721,058 327,265
Waivers:
Waiver of Shareholder services fee--Class R Shares (69,941) (28,758)
Waiver of Shareholder services fee--Class B Shares (191) (84)
Total waivers (70,132) (28,842)
Net expenses 650,926 298,423
Net investment income/(Net operating loss) 18,817 (114,089)
Realized and Unrealized Gain (Loss) on Investments:
Net realized gain on investments 4,186,714 574,336
Net change in unrealized appreciation (depreciation) of investments (11,422,818) (2,731,219)
Net realized and unrealized loss on investments (7,236,104) (2,156,883)
Change in net assets resulting from operations $ (7,217,287) $(2,270,972)
(See Notes which are an integral part of the Financial Statements)
</TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
Riggs Funds
<TABLE>
<CAPTION>
Small Company
Stock Fund
Stock Fund
Six Months Six Months
Ended Year Ended
Ended Year Ended
(unaudited) (unadited)
October 31, April 30, October
31, April 30,
1999 1999
1999 1999
<S> <C> <C> <C>
<C>
Increase (Decrease) in Net Assets:
Operations--
Net investment income (net operating loss) $ 18,817 $ 262,526 $ (114,089)
$ (60,901)
Net realized gain (loss) in investments 4,186,714 8,227,259
574,336 (4,753,762)
Net change in unrealized appreciation (depreciation) of
investments (11,422,818) (3,149,465)
(2,731,219) (11,661,505)
Change in net assets resulting from operations (7,217,287) 5,340,320
(2,270,972) (16,476,168)
Distributions to Shareholders--
Distributions from net investment income
Class R Shares (59,243) (292,776)
- -- --
Class B Shares -- (57)(1)
- -- --
Distributions from net realized gains
Class R Shares (8,502,330) (10,140,817)
- -- (5,407,163)
Class B Shares (28,707) (11,768)(1)
- -- (18,999)(2)
Change in net assets resulting from distributions to
shareholders (8,590,280) (10,445,418)
- -- (5,426,162)
Share Transactions--
Proceeds from sales of shares 7,062,727 23,801,961
4,495,004 23,672,150
Net asset value of shares issued to shareholders in payment of
distributions declared 7,381,846 10,170,057
- -- 5,415,147
Cost of shares redeemed (21,973,908) (44,325,647)
(9,079,081) (26,579,582)
Change in net assets resulting from share transactions (7,529,335) (10,353,629)
(4,584,077) 2,507,715
Change in net assets (23,336,902) (15,458,727)
(6,855,049) (19,394,615)
Net Assets:
Beginning of period 101,656,607 117,115,334
38,828,719 58,223,334
End of period $ 78,319,705 $101,656,607 $31,973,670
$ 38,828,719
Undistributed (distributions in excess of/net operating loss)
net investment income
included in net assets at end of period $ (3,693) $ 36,733 $
(114,089) --
Net gain as computed for federal tax purposes $ 4,186,714 $ 8,539,951 $ 574,336
$ (3,967,647)
</TABLE>
(1) Reflects operations for the period from July 19, 1998 (date of initial
public investment) to April 30, 1999.
(2) Reflects operations for the period from July 17, 1998 (date of initial
public investment) to April 30, 1999.
(See Notes which are an integral part of the Financial Statements)
FINANCIAL HIGHLIGHTS
Riggs Funds
Class B Shares
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Net Asset Net Realized
Distributions Distributions
Year Value, Net and Unrealized Total From from
Net from Net
Ended beginning Operating Gain (Loss) on Investment Investment
Realized Total
April 30, of period Loss Investments Operations Income
Gains Distributions
<S> <C> <C> <C> <C> <C>
<C> <C>
Stock Fund
1999(3) $16.65 (0.03) 0.83 0.80 (0.01)
(1.71) (1.72)
1999(6) $15.73 (0.00)(7) (1.22) (1.22) --
(1.44) (1.44)
Small Company Stock Fund
1999(5) $17.25 (0.07) (4.12) (4.19) --
(1.85) (1.85)
1999(6) $11.21 (0.04) (0.80) (0.84) --
- -- --
</TABLE>
(1) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(2) During the period certain fees were voluntarily waived. If such voluntary
waivers had not occurred, the ratios would have been as indicated.
(3) Reflects operations for the period from July 19, 1998 (date of initial
public investment) to April 30, 1999.
(4) Computed on an annualized basis.
<TABLE>
<CAPTION>
Ratios to Average Net Assets
Net Net
Net Asset Investment/ Investment/ Net Assets,
Value, end Total Operating Expenses Operating Loss end of period
Portfolio
of period Return(1) Expenses(2) Loss(2) (after waivers) (after waivers) (000
omitted) Turnover
<S> <C> <C> <C> <C> <C> <C>
<C>
$15.73 5.31% 2.16%(4) (0.67%)(4) 1.97%(4) (0.48%)(4)
$182 52%
$13.07 (7.57%) 2.04%(4) (0.61%)(4) 1.89%(4) (0.46%)(4)
$367 21%
$11.21 24.43% 2.33%(4) (0.97%)(4) 2.13%(4) (0.77%)(4)
$101 100%
$10.37 (7.49%) 2.20%(4) (1.24%)(4) 2.05%(4) (1.09%)(4)
$104 50%
</TABLE>
(5) Reflects operations for the period from July 17, 1998 (date of initial
public investment) to April 30, 1999.
(6) For the six month period ended October 31, 1999 (unaudited). (7) Amount
represents less than $0.01 per share. (See Notes which are an integral part of
the Financial Statements)
COMBINED NOTES TO FINANCIAL STATEMENTS
Riggs Funds
October 31, 1999 (unaudited)
(1) Organization
Riggs Funds (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "Act"), as an open-end management investment company. The
Trust consists of five diversified portfolios, two of which offer Class B Shares
(individually referred to as the "Fund", or collectively as the "Funds") which
are presented herein:
Portfolio Name Investment Objective
Riggs Stock Fund ("Stock Fund") Seeks to provide growth of capital and income.
Riggs Small Company Stock Fund Seeks to provide long-term capital
("Small Company Fund") appreciation.
The assets of each portfolio are segregated and a shareholders interest is
limited to the portfolio in which shares are held.
(2) Significant Accounting Policies
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. These
policies are in conformity with generally accepted accounting principles.
Investment Valuations
U.S. government securities, listed corporate bonds (other fixed income and
asset-backed securities), and unlisted securities and private placement
securities are generally valued at the mean of the latest bid and asked price as
furnished by an independent pricing service. Listed equity securities (and
investments in closed-end investment companies) are valued at the last sale
price reported on a primary national securities exchange. For the money market
Funds within the Trust, the use of the amortized cost method to value portfolio
securities is in accordance with Rule 2a-7 under the Act. For fluctuating net
asset value Funds within the Trust, short-term securities are valued at the
prices provided by an independent pricing service. However, short-term
securities purchased with remaining maturities of sixty days or less may be
valued at amortized cost, which approximates fair market value.
Repurchase Agreements
It is the policy of the Funds to require the custodian bank to take possession,
to have legally segregated in the Federal Reserve Book Entry System, or to have
segregated within the custodian bank's vault, all securities held as collateral
under repurchase agreement transactions. Additionally, procedures have been
established by the Funds to monitor, on a daily basis, the market value of each
repurchase agreement's collateral to ensure that the value of collateral at
least equals the repurchase price to be paid under the repurchase agreement
transaction.
The Funds will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed by
the Funds' adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the "Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Funds could receive less
than the repurchase price on the sale of collateral securities.
Investment Income, Expenses and Distributions
Interest income and expenses are accrued daily. Bond premium and discount, if
applicable, are amortized as required by the Internal Revenue Code, as amended
(the "Code"). Dividend income and distributions to shareholders are recorded on
the ex-dividend date.
Federal Taxes
It is the Funds' policy to comply with the provisions of the Code applicable to
regulated investment companies and to distribute to shareholders each year
substantially all of their income. Accordingly, no provisions for federal tax
are necessary.
At April 30, 1999, the Small Company Fund, for federal tax purposes, had a
capital loss carryforward of $3,967,647, which will reduce the Fund's taxable
income arising from future net realized gains on investments, if any, to the
extent permitted by the Code, and thus reduce the amount of the distributions to
shareholders which would otherwise be necessary to relieve the Small Company
Fund of any liability for federal tax. Pursuant to the Code, such capital loss
carryforward will expire in 2006.
When-Issued and Delayed Delivery Transactions
The Funds may engage in when-issued or delayed delivery transactions. The Funds
record when-issued securities on the trade date and maintain security positions
such that sufficient liquid assets will be available to make payment for the
securities purchased. Securities purchased on a when-issued or delayed delivery
basis are marked to market daily and begin earning interest on the settlement
date.
Securities Lending
Under guidelines adopted by the Board of Trustees, each Fund may lend portfolio
securities to brokers/dealers and other financial organizations in order to
generate additional income. Loans of portfolio securities by a Fund will be
collateralized by cash, letters of credit or U.S. government securities which
are maintained at 100% of the current market value of the loaned securities.
Collateral is either held as cash or reinvested in short-term securities
including overnight repurchase agreements, commercial paper, master notes,
floating rate corporate notes (with at least quarterly reset rates) and money
market funds. The Funds return a portion of the interest on any cash received as
collateral and continue to receive interest or dividends on securities loaned.
Included in interest income is $1,738 and $8,582 for Stock Fund and Small
Company Fund, respectively, of income earned on securities lending transactions.
Loans will be made to firms deemed by the Company's advisor to be of good
financial standing and will not be made unless, in the judgement of the
Company's adviser, the consideration to be earned from such loans would justify
the risk. The risks associated with lending portfolio securities consist of
possible decline in value of collateral, possible delays receiving additional
collateral or in the recovery of the loaned securities or expenses from
enforcing the Funds' rights should be the borrower of the securities fail
financially.
As of October 31, 1999, the value of securities loaned and the payable on
collateral due to broker were as follows:
<TABLE>
<CAPTION>
Payable on
Market Value of Collateral
Fund Securities Loaned Due Broker
<S> <C> <C>
Stock Fund $1,441,834 $1,436,655
Small Company Fund $4,705,067 $4,822,791
Cash collateral is held in a segregated account.
</TABLE>
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 amounts of assets, liabilities, expenses and revenues reported in the
financial statements. Actual results could differ from those estimated.
Other
Investment transactions are accounted for on the trade date.
(3) Shares of Beneficial Interest
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in shares were as follows:
<TABLE>
<CAPTION>
Stock Fund
Six Months Ended
Year Ended
October 31, 1999
April 30, 1999
Class R Shares Amount Shares
Amount Shares
<S> <C> <C>
<C> <C>
Shares sold $ 6,856,477 456,027 $
23,625,339 1,542,657
Shares issued to shareholders in payment of distributions declared 7,353,256 572,084
10,158,300 676,733
Shares redeemed (21,972,074) (1,513,863)
(44,312,176) (2,867,893)
Net change resulting from Class R Shares transactions $ (7,762,341) (485,752)
$(10,528,537) (648,503)
Stock Fund
Six Months Ended
Period Ended
October 31, 1999
April 30, 1999 (1)
Class B Shares Amount Shares
Amount Shares
Shares sold $ 206,250 14,368 $
176,622 11,692
Shares issued to shareholders in payment of distributions declared 28,590 2,241
11,757 785
Shares redeemed (1,834) (137)
(13,471) (891)
Net change resulting from Class B Shares transactions $ 233,006 16,472 $
174,908 11,586
Net change resulting from share transactions $ (7,529,335) (469,280)
$(10,353,629) (636,917)
</TABLE>
(1) Reflects operations for the period from July 19, 1998 (date of initial
public investment) to April 30, 1999.
<TABLE>
<CAPTION>
Small Company Fund
Six Months Ended
Year Ended
October 31, 1999
April 30, 1999
Class R Shares Amount Shares
Amount Shares
<S> <C> <C>
<C> <C>
Shares sold $ 4,481,039 380,151 $
23,513,675 1,811,335
Shares issued to shareholders in payment of distributions declared --- ---
5,396,154 472,104
Shares redeemed (9,077,779) (766,731)
(26,536,536) (1,942,196)
Net change resulting from Class R Shares transactions $(4,596,740) (386,580) $
2,373,293 341,243
Small Company Fund
Six Months Ended
Period Ended
October 31, 1999
April 30, 1999 (2)
Class B Shares Amount Shares
Amount Shares
Shares sold $ 13,965 1,157 $
158,475 11,167
Shares issued to shareholders in payment of distributions declared -- --
18,993 1,668
Shares redeemed (1,302) (104)
(43,046) (3,822)
Net change resulting from Class B Shares transactions $ 12,663 1,053 $
134,422 9,013
Net change resulting from transactions $(4,584,077) (385,527) $
2,507,715 350,256
</TABLE>
(2) Reflects operations for the period from July 17, 1998 (date of initial
public investment) to April 30, 1999.
(4) Investment Advisory Fee and Other Transactions with Affiliates
Investment Advisory Fee
Riggs Investment Management Corp., the Trust's investment adviser (the
"Adviser"), receives for its services an annual investment advisory fee based on
a percentage of each Fund's average daily net assets (see below). The Adviser
may voluntarily choose to waive a portion of its fee. The Adviser can modify or
terminate this voluntary waiver at any time at its sole discretion.
Fund Annual Rate
Stock Fund 0.75%
Small Company Fund 0.80%
Administrative Fee
Federated Administrative Services ("FAS") provides the Trust with certain
administrative personnel and services (including certain legal, fund accounting
and transfer agency services). The FAS fee is based on the level of average
aggregate net assets of the Trust for the period.
Distribution Services Fee
The Funds have adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1
under the Act. Under the terms of the Plan, the Fund will compensate Federated
Securities Corp. ("FSC"), the principal distributor, from the net assets of the
fund to finance activities intended to result in the sale of the Fund's Class R
and Class B Shares. The Plan provides that the Funds may incur distribution
expenses according to the following schedule annually, to compensate FSC. FSC
may voluntarily choose to waive any portion of its fee. FSC can modify or
terminate this voluntary waiver at any time at its sole discretion.
Percentage of Average
Share Class Name Net Assets of Class
Class R Shares 0.25%
Class B Shares 0.75%
Shareholder Services Fee
Under the terms of a Shareholder Services Agreement with FAS, each Fund will pay
up to 0.25% of average daily net assets of the Fund for the period. The fee is
paid to FAS to finance certain services for shareholders and to maintain
shareholder accounts. FAS may voluntarily choose to waive any portion of its
fee. FAS can modify or terminate this voluntary waiver at any time at its sole
discretion.
Custodian Fees
Riggs Bank N.A. is the Fund's custodian. The fee is based on the level of each
Fund's average daily net assets for the period, plus out-of-pocket expenses.
Organizational Expenses
Organizational expenses were borne initially by FAS. The Funds have agreed to
reimburse FAS for the organizational expenses during the five year period
following each Fund's effective date. For the year ended October 31, 1999, the
following amounts were paid pursuant to this agreement:
<TABLE>
<CAPTION>
Riggs Funds
Organizational Expenses
Organizational Paid for the Six Months Ended
Fund Effective Date Expenses October 31, 1999
<S> <C> <C> <C>
Small Company Fund February 6, 1995 $22,693 $2,269
</TABLE>
General
Certain of the Officers and Trustees of the Trust are Officers and Directors or
Trustees of the above companies.
(5) Investment Transactions
Purchases and sales of investments, excluding short-term obligations, for the
six months ended October 31, 1999, were as follows:
<TABLE>
<CAPTION>
Fund Purchases Sales
<S> <C> <C>
Stock Fund $19,124,677 $33,858,956
Small Company Fund 17,669,457 24,185,716
</TABLE>
(6) Subsequent Event
On December 17, 1999, the Trust will add four new portfolios to the Riggs Funds
Family: Riggs Large Cap Growth Fund (Class R and Class B Shares), Riggs Bond
Fund (Class R Shares), Riggs Intermediate Tax Free Bond Fund (Class R Shares),
and Riggs Long Term Tax Free Bond Fund (Class R Shares).
(7) Year 2000
Similar to other financial organizations, the Funds could be adversely affected
if the computer systems used by the Fund's service providers do not properly
process and calculate date-related information and data from and after January
1, 2000. The Fund's Adviser and administrator are taking measures that they
believe are reasonably designed to address the Year 2000 issue with respect to
computer systems that they use and to obtain reasonable assurances that
comparable steps are being taken by each of the Fund's other service providers.
At this time, however, there can be no assurance that theses steps will be
sufficient to avoid any adverse impact to the Funds.
TRUSTEES
John F. Donahue
Thomas G. Bigley
John T. Conroy, Jr.
Nicholas P. Constantakis
John F. Cunningham
J. Christopher Donahue
Lawrence D. Ellis, M.D.
Peter E. Madden
Charles F. Mansfield, Jr.
John E. Murray, Jr.
Marjorie P. Smuts
John S. Walsh
OFFICERS
John F. Donahue
Chairman
Edward C. Gonzales
President and Treasurer
J. Christopher Donahue
Executive Vice President
John W. McGonigle
Executive Vice President and Secretary
Joseph S. Machi
Vice President and Assistant Treasurer
Richard B. Fisher
Vice President
C. Grant Anderson
Assistant Secretary
Mutual funds are not bank deposits or obligations, are not guaranteed by any
bank, and are not insured or guaranteed by the U.S. government, the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in mutual funds involves risk, including possible
loss of principal.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by the Funds' prospectus which contains facts concerning
the Funds' objectives and policies, management fees, expenses and other
information.
Cusip 76656A 708
Cusip 76656A 880
G00356-02 (12/99)
