111 CORCORAN BOND FUND
- --------------------------------------------------------------------------------
ANNUAL REPORT FOR FISCAL YEAR ENDED MAY 31, 1996
INVESTMENT REVIEW
---------------------------------------------------------------------------
The 111 Corcoran Bond Fund (the "Fund") had a total return of 4.41%*
on a net asset value basis for the fiscal year ended May 31, 1996. Rates
have risen sharply since the end of January as the economy has been much
stronger than anticipated. Inflation continues to show only moderate
increases.
The market value of the fund is approximately $87,000,000 with almost
80% of the assets in government obligations and conservative government
insured mortgages. The average maturity of the fund is 8.33 years which is
shorter than last year and in line with the investment goals of producing a
good current income with reduced volatility. Quality is excellent.
Barring a sharp increase in inflation we remain positive on the bond
market.
* Performance quoted represents past performance. 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.
111 CORCORAN BOND FUND
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN 111 CORCORAN BOND FUND
SINCE INCEPTION AS OF MAY 31, 1996.
The graph below illustrates the hypothetical investment of $10,000 in the
111 Corcoran Bond Fund (the "Fund") from July 15, 1992 (start of performance) to
May 31, 1996, compared to the Lehman Brothers Aggregate Bond Index ("LBAI").
<TABLE> (Graphic representation omitted see Appendix A)
<CAPTION>
Lehman Brothers
Measurement Period 111 Corcoran Aggregate Bond
(Fiscal Year Covered) Bond Fund Index
<S> <C> <C>
15-Jul-92 9550 10000
5/31/93 10150 10980
5/31/94 10273 11058
5/31/95 11436 12326
5/31/96 11940 12866
</TABLE>
AVERAGE ANNUAL TOTAL RETURN** FOR THE PERIOD ENDED MAY 31, 1996
<TABLE>
<S> <C>
1 Year....................................................................... (0.28%)
Start of Performance, July 15, 1992.......................................... 4.68%
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. YOUR INVESTMENT RETURN
AND PRINCIPAL VALUE WILL FLUCTUATE SO WHEN SHARES ARE REDEEMED, THEY MAY BE
WORTH MORE OR LESS THAN THE ORIGINAL COST. MUTUAL FUNDS ARE NOT OBLIGATIONS OF
OR GUARANTEED BY ANY BANK AND ARE NOT FEDERALLY INSURED.
This report must be preceded or accompanied by the Fund's prospectus dated July
31, 1996, and, together with the financial statements contained therein,
constitutes the Fund's annual report.
* Represents a hypothetical investment of $10,000 in the Fund, after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions.
** Total return quoted reflects all applicable sales charges and contingent
deferred sales charges.
The LBAI is not adjusted to reflect sales charges, expenses, or other fees that
the SEC requires to be reflected in the Fund's performance. The LBAI has been
adjusted to reflect reinvestment of dividends on securities. This index is
unmanaged.
LOGO
Cusip 682365200
G00315-01 (7/96)
111 CORCORAN NORTH CAROLINA MUNICIPAL SECURITIES FUND
- --------------------------------------------------------------------------------
ANNUAL REPORT FOR FISCAL YEAR ENDED MAY 31, 1996
INVESTMENT REVIEW
---------------------------------------------------------------------------
The 111 Corcoran North Carolina Municipal Securities Fund (the "Fund")
had a total return of 3.72%* on a net asset value basis for the fiscal year
ended May 31, 1996. Interest rates began rising several months ago as the
economy has shown surprising strength despite the fact that the current
recovery is over five years old.
There is one interesting phenomenon that should be mentioned. North
Carolina bonds have historically sold at lower yields than other states.
Last year, however, these yield spreads narrowed to the point that our best
bonds sold at the same yields as other states. This was due to the large
supply of new bonds that came to the market in North Carolina. We think
this is temporary and with the higher quality, North Carolina bonds will
again trade at a premium.
The average maturity of the fund is 9.47 years which represents a
slight decline from last year. The quality continues to be excellent.
Management does not feel the additional yield available warrants lowering
our credit standards at this time.
Municipal bonds still represent good value versus taxable issues
especially in the longer end of the market. Your management will remain
alert to opportunities to capture this value.
* Performance quoted represents past performance. 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.
111 CORCORAN NORTH CAROLINA MUNICIPAL SECURITIES FUND
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN 111 CORCORAN NORTH CAROLINA MUNICIPAL SECURITIES
FUND
SINCE INCEPTION AS OF MAY 31, 1996.
The graph below illustrates the hypothetical investment of $10,000 in the
111 Corcoran North Carolina Municipal Securities Fund (the "Fund") from July 22,
1992 (start of performance) to May 31, 1996 compared to the Lehman Brothers
State General Obligation Bond Index ("LSGOB").
<TABLE> (Graphic representation omitted see Appendix B)
<CAPTION>
111 Corcoran Lehman Brothers
North Carolina State Gener al
Measurement Period Municipal Obligations
(Fiscal Year Covered) Securities Fund Bond Index
<S> <C> <C>
22-Jul-92 9550 10000
5/31/93 10254 10983
5/31/94 10530 11305
5/31/95 11352 12264
5/31/96 11774 12832
</TABLE>
AVERAGE ANNUAL TOTAL RETURN** FOR THE PERIOD ENDED MAY 31, 1996
<TABLE>
<S> <C>
1 Year....................................................................... (0.93%)
Start of Performance, July 22, 1992.......................................... 4.32%
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. YOUR INVESTMENT RETURN
AND PRINCIPAL VALUE WILL FLUCTUATE SO WHEN SHARES ARE REDEEMED, THEY MAY BE
WORTH MORE OR LESS THAN THE ORIGINAL COST. MUTUAL FUNDS ARE NOT OBLIGATIONS OF
OR GUARANTEED BY ANY BANK AND ARE NOT FEDERALLY INSURED.
This report must be preceded or accompanied by the Fund's prospectus dated July
31, 1996, and, together with the financial statements contained therein,
constitutes the Fund's annual report.
* Represents a hypothetical investment of $10,000 in the Fund after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions.
** Total return quoted reflects all applicable sales charges and contingent
deferred sales charges.
The LSGOB is not adjusted to reflect sales charges, expenses, or other fees that
the SEC requires to be reflected in the Fund's performance. The LSGOB has been
adjusted to reflect reinvestment of dividends on securities. This index is
unmanaged.
LOGO
Cusip 682365101
G00316-01 (7/96)
111 CORCORAN EQUITY FUND
- --------------------------------------------------------------------------------
ANNUAL REPORT FOR THE FISCAL YEAR ENDED MAY 31, 1996
INVESTMENT REVIEW
---------------------------------------------------------------------------
The investment objective of the 111 Corcoran Equity Fund (the "Fund")
is to provide high total return over longer periods of time through
appreciation of capital and current income. The Fund attempts to achieve
its investment objective by investing primarily in a broad, diversified
range of dividend paying common stocks in companies deemed to have above
average earnings growth prospect.
For the fiscal year ended May 31, 1996, the fund produced a total
return, on a net asset basis, of 23.91%.* During this period, U.S. equity
markets advanced on the prospect for moderate economic growth and mild
inflation. Recent data has yielded evidence of a strengthening global
economy. This has heightened inflation concerns causing interest rates to
move sharply higher. However, the encouraging signs of economic growth
enhance the outlook for sustained corporate profit improvement and higher
stock prices.
As of May 31, 1996, the Fund's portfolio was 99% invested in stocks
and had a cash position of 1%. Total Fund assets were approximately $29
million. The Fund's ten largest holdings were:
<TABLE>
<S> <C>
Intel Corp. 3.4%
General Motors Corp. 3.1
American Express Co. 2.9
General Electric Co. 2.8
AT&T Corp. 2.7
Jefferson-Pilot Corp. 2.6
Sears, Roebuck & Co. 2.6
Johnson & Johnson 2.5
Grace W.R. & Co. 2.3
Motorola, Inc. 2.3
</TABLE>
Fund management considers the Fund to be well positioned for continued
favorable relative returns. Growing markets in Latin America, the Pacific
Basin and Asia offer unlimited opportunities for the sale of U.S. goods and
services. The Fund holds stocks of multinational companies that are both
world-class competitors and low cost producers.
Thank you for your investment in the 111 Corcoran Equity Fund.
* Performance quoted represents past performance. 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.
111 CORCORAN EQUITY FUND
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN 111 CORCORAN EQUITY FUND
SINCE INCEPTION AS OF MAY 31, 1996.
The graph below illustrates the hypothetical investment of $10,000 in the
111 Corcoran Equity Fund (the "Fund") from December 5, 1994 (start of
performance) to May 31, 1996 compared to the Standard & Poor's 500 Index ("S&P
500").
<TABLE> (Graphic representation omitted see Appendix C)
<CAPTION>
Standard &
Measurement Period 111 Corcoran Poor's 500
(Fiscal Year Covered) Equity Fund Index
<S> <C> <C>
5-Dec-94 9550 10000
5/31/95 10539 11923
5/31/96 13059 15314
</TABLE>
AVERAGE ANNUAL TOTAL RETURN** FOR THE PERIOD ENDED MAY 31, 1996
<TABLE>
<S> <C>
1 Year................................................................. 18.35%
Start of Performance, December 5, 1994................................. 23.36%
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. YOUR INVESTMENT RETURN
AND PRINCIPAL VALUE WILL FLUCTUATE SO WHEN SHARES ARE REDEEMED, THEY MAY BE
WORTH MORE OR LESS THAN THE ORIGINAL COST. MUTUAL FUNDS ARE NOT OBLIGATIONS OF
OR GUARANTEED BY ANY BANK AND ARE NOT FEDERALLY INSURED.
This report must be preceded or accompanied by the Fund's prospectus dated July
31, 1996, and, together with the financial statements contained therein,
constitutes the Fund's annual report.
* Represents a hypothetical investment of $10,000 in the Fund, after deducting
the maximum sales charge of 4.50% ($10,000 investment minus $450 sales charge
= $9,550). The Fund's performance assumes the reinvestment of all dividends
and distributions.
** Total return quoted reflects all applicable sales charges and contingent
deferred sales charges.
The S&P 500 is not adjusted to reflect sales charges, expenses, or other fees
that the SEC requires to be reflected in the Fund's performance. The S&P 500 has
been adjusted to reflect reinvestment of the dividends on securities. This index
is unmanaged.
LOGO
Cusip 682365309
G00925-01 (7/96)
Blanchard Group of Funds
Annual Report Graphic Appendix
A. The graphic representation here displayed consists of a line graph.
The corresponding components of the line graph are listed underneath.
The Shares of the 111 Corcoran Bond Fund are represented by a solid
line. The Lehman Brothers Aggregate Bond Index is represented by a
dotted line. The line graph is a visual representation of a
comparison of change in value of a hypothetical investment of $10,000
in Shares of the 111 Corcoran Bond Fund and the Lehman Brothers
Aggregate Bond Index for the period from July 15, 1992 (dated of
inception) to May 31, 1996. The "y" axis reflects the cost of
investment. The "x" axis reflects computation periods from July 15,
1992 (date of inception) to May 31, 1996. The right margin of the
chart reflects the ending value of the hypothetical investment in the
Shares of the Fund as compared to the Lehman Brothers Aggregate Bond
Index. The ending values are $11,940 and $12,866, respectively.
B. The graphic representation here displayed consists of a line graph.
The corresponding components of the line graph are listed underneath.
The Shares of the 111 Corcoran North Carolina Municipal Securities
Fund are represented by a solid line. The Lehman Brothers State
General Obligation Bond Index is represented by a dotted line. The
line graph is a visual representation of a comparison of change in
value of a hypothetical investment of $10,000 in Shares of the 111
Corcoran North Carolina Municipal Securities Fund and Lehman Brothers
State General Obligation Bond Index for the period from July 22, 1992
(date of inception) to May 31, 1996. The "y" axis reflects the cost
of investment. The "x" axis reflects computation periods from July
22, 1992 (date of inception) to May 31, 1996. The right margin of the
chart reflects the ending value of the hypothetical investment in the
Shares of the Fund as compared to Lehman Brothers State General
Obligation Bond Index. The ending values are $11,774 and $12,832,
respectively.
C. The graphic representation here displayed consists of a line graph.
The corresponding components of the line graph are listed underneath.
The Shares of the 111 Corcoran Equity Fund are represented by a solid
line. The Standard & Poor's 500 Index is represented by a dotted
line. The line graph is a visual representation of a comparison of
change in value of a hypothetical investment of $10,000 in Shares of
the 111 Corcoran Equity Fund and Standard & Poor's 500 Index for the
period from December 5, 1994 (date of inception) to May 31, 1996. The
"y" axis reflects the cost of investment. The "x" axis reflects
computation periods from December 5, 1994 (date of inception) to May
31, 1996. The right margin of the chart reflects the ending value of
the hypothetical investment in the Shares of the Fund as compared to
the Standard & Poor's 500 Index. The ending values are $13,059 and
15,314, respectively.
