ANNUAL
................................................................................
FINANCIAL REPORT
................................................................................
STI CLASSIC FUNDS
................................................................................
A Family of Mutual Funds
................................................................................
May 31, 1997
STI CLASS FUNDS (LOGO)
[GRAPHIC OMITTED]
<PAGE>
Dear STI Classic Trust Shareholder:
As of May 31, 1997, your STI Classic Funds' assets totaled $8.6 billion or 26.5%
more than the $6.8 billion reported to you as of May 31, 1996.
Since the last semi-annual report of November 30, 1996, four new STI Classic
Funds have been added, including a new small cap equity "value style" fund and
an international emerging markets fund. The STI Classic family now includes 23
funds covering a broad range of investment objectives and management styles.
The U.S. economic expansion is now more than six years old and it has been
characterized by modest inflation and strong investment returns. Economic growth
has been somewhat erratic in nature, including a strong rebound in late 1996 and
early 1997 followed by a slowdown recently.
In response to accelerated growth and fears of renewed inflation, the Federal
Reserve raised interest rates by a quarter of one percent. As the economy grew,
interest rates initially rose and the stock market declined by approximately
10%. Recently, economic data has confirmed that slower, more sustainable growth
has occurred; thereby, causing long interest rates to decline by approximately
one half of one percent and stocks have rebounded to record levels.
Given the STI Classic Funds' quality oriented, disciplined investment approach,
we believe our shareholders are well positioned for future investment
opportunities.
Sincerely,
/s/ ANTHONY R. GRAY
Anthony R. Gray
President, Chief Investment Officer
STI Capital Management, N.A.
/s/ DOUGLAS S. PHILLIPS
Douglas S. Phillips, CFA
President, Chief Investment Officer
Trusco Capital Management, Inc.
<PAGE>
STI CLASSIC VALUE INCOME STOCK FUND
- --------------------------------------------------------------------------------
The STI Classic Value Income Stock Fund (the "Fund") seeks to provide current
income with the secondary goal of achieving capital appreciation by investing
primarily in equity securities.
The Fund's investment philosophy is a very structured, methodical approach to
purchasing stocks. The bottom-up approach has three key factors to consider in
all investment decisions -- minimum dividend yield criteria, low historical
relative valuation, and a fundamental catalyst which could upwardly value the
individual security.
Our process seeks high-dividend paying stocks that are trading at the lower end
of their historical valuation ranges. These companies are in the midst of
fundamental change that we expect will reignite investor interest in the near
term. They tend to exhibit value characteristics such as low price-to-earnings
ratios and have lower volatility. As a result, the Fund benefits when the market
becomes less exuberant and more value oriented.
A good example of a company whose stock was depressed and was in the midst of
fundamental change is Dow Jones & Co., publisher of The Wall Street Journal and
Telerate, a business data service. A group of disenchanted stockholders recently
insisted that the company consider selling Telerate, a perennially poor
performer, and the stock rose sharply as a result.
We believe the Fund performed well relative to the standard value equity
benchmarks, the S&P/Barra Value Index and the Lipper Equity Income Funds
Average. The performance was due in part to the high yield of the portfolio.
Stock selection also played a key factor.
Other stocks that proved to be top performers this year include, Reynolds
Metals, which is in the midst of a major restructuring in which several
divisions are being considered for sale. A strong performing group was energy.
Amoco has a massive share repurchase plan underway. Marathon has aggressively
paid down debt, and is a major force in refining in the Midwest.
/s/ MILLS A. RIDDICK
Mills A. Riddick, CFA
Managing Director
2
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 compared with the growth
of hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- --------------------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- --------------------------------------------------------------------------------
22.18% 23.00% 18.87% 110.15%
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Invested in the STI Growth of $10,000 Growth of $10,000
Classic Value Income Invested in the Invested in the Lipper
Stock Fund, S&P/BARRA Value Equity Income Funds
Trust Shares Index Average
Period Ended
2/28/93 $10,000 $10,000 $10,000
5/31/93 10,395 10,426 10,345
5/31/94 11,432 11,202 10,836
5/31/95 13,611 13,114 12,234
5/31/96 17,410 16,568 15,123
5/31/97 21,271 20,787 18,515
Investor Shares
- --------------------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- --------------------------------------------------------------------------------
21.69% 22.54% 19.20% 112.16% Without load
- --------------------------------------------------------------------------------
17.14% 20.99% 18.14% 104.19% With load
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Invested in the STI Growth of $10,000 Growth of $10,000
Classic Value Income Invested in the Invested in the Lipper
Stock Fund, S&P/BARRA Value Equity Income Funds
Investor Shares Index Average
Period Ended
2/28/93 $ 9,625 $10,000 $10,000
5/31/93 10,010 10,426 10,345
5/31/94 10,940 11,202 10,836
5/31/95 12,986 13,114 12,234
5/31/96 16,543 16,568 15,123
5/31/97 20,132 20,787 18,515
Flex Shares
- --------------------------------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- --------------------------------------------------------------------------------
20.91% 23.68% 52.97% Without load
- --------------------------------------------------------------------------------
18.91% 23.68% 52.97% With load
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Invested in the STI Growth of $10,000 Growth of $10,000
Classic Value Income Invested in the Invested in the Lipper
Stock Fund, S&P/BARRA Value Equity Income Funds
Flex Shares Index Average
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 12,566 12,539 12,211
5/31/97 15,193 15,731 14,950
Past performance is no indication of future performance.
The Funds'comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
3
<PAGE>
STI CLASSIC MID-CAP EQUITY FUND
- --------------------------------------------------------------------------------
The STI Classic Mid-Cap Equity Fund (the "Fund") seeks capital appreciation by
investing in the stocks of companies with a market capitalization between $50
million and $5 billion.
Mid-cap securities with a strong growth history are the primary consideration
for this investment philosophy. These companies are evaluated relative to their
industry sector and the market in general. Each industry sector is considered in
relation to the business cycle, and the Fund maintains large positions in the
sectors which appear to perform best in the given cycle. Stocks that fall within
favored sectors are analyzed based on fundamentals -- the quality of earnings,
dependability of growth rates, and relative attractiveness of price/earnings
ratios.
The mid-cap stock universe continued to underperform the large capitalization
averages such as the Standard & Poor's 500 and the Dow Jones Industrial Average.
This broad underperformance of mid-cap as well as small cap stocks began last
summer, as investors sought the liquidity and brand name appeal of big
companies.
Our Fund included technology stocks of all sizes, which fared poorly. Our worst
holding was Atmel, a midsized chipmaker. Regional bank stocks were adversely
impacted by the rise in interest rates, even though these banks all raised their
prime lending rate along with their higher cost of funds. On the plus side,
building sector stocks such as Stanley Works, Foster Wheeler and American
Standard were among the strongest performers.
/s/ ELLIOT PERNY
Elliot Perny
Managing Director
4
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- --------------------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- --------------------------------------------------------------------------------
14.23% 17.30% 15.01% 59.17%
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Invested in the STI Growth of $10,000
Classic Mid-Cap Equity Invested in the S&P
Fund, Trust Shares Mid-Cap 400 Index
Period Ended
2/28/94 $10,000 $10,000
5/31/94 9,735 9,516
5/31/95 10,958 10,803
5/31/96 13,756 13,877
5/31/97 15,714 16,397
Investor Shares
- ---------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- ---------------------------------------------------------------
13.76% 16.75% 14.42% 56.58% Without load
- ---------------------------------------------------------------
9.46% 15.28% 13.11% 50.70% With load
- ---------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Invested in the STI Growth of $10,000
Classic Mid-Cap Equity Invested in the S&P
Fund, Investor Shares Mid-Cap 400 Index
Period Ended
1/31/94 $ 9,625 $10,000
5/31/94 9,471 9,381
5/31/95 10,603 10,650
5/31/96 13,247 13,676
5/31/97 15,070 16,164
Flex Shares
- ---------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ---------------------------------------------------
13.06% 17.91% 38.78% Without load
- ---------------------------------------------------
11.06% 17.91% 38.78% With load
- ---------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Invested in the STI Growth of $10,000
Classic Mid-Cap Equity Invested in the S&P
Fund, Flex Shares Mid-Cap 400 Index
Period Ended
6/30/95 $10,000 $10,000
5/31/96 11,639 12,339
5/31/97 13,385 14,584
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
5
<PAGE>
STI SMALL CAP EQUITY FUND
- --------------------------------------------------------------------------------
The STI Classic Small Cap Equity Fund seeks capital appreciation with a
secondary goal of achieving current income by investing in the stocks of
companies with a market capitalization of less than $1 billion.
In a period that was very difficult for small capitalization stocks in general,
our small cap value equity style produced strong returns. There are several
reasons for this outperformance. First, the value style outperformed the growth
style of investment by a wide margin. Second, our insistence that every stock we
select pay a dividend provided a cushion in a negative margin. Third, we were
very underweighted in technology, an area that was very bearish. Finally, we
were also underweighted in financial services, an industry that became very
richly valued in the fourth quarter.
The top performing stock during the period was Security Connecticut, a life
insurance company that focuses on high net worth individuals. The company was
bought out by a company with a much larger salesforce that is properly equipped
to market Security Connecticut's products. Another winner was Applied Industrial
Technology. The company is a large distributor of ball bearings and other
manufacturing products. On the downside, Alamo Group, which makes industrial
lawn mowing equipment was down. Bad weather negatively impacted the company, and
inventories built up dramatically.
/s/ BRETT L. BARNER
Brett L. Barner, CFA
Principal
6
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance is a
line graph depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmark.
Trust Shares*
- ---------------------------------------------------------
Three Cumulative
Month Inception
Return to Date
- ---------------------------------------------------------
6.60% 10.97%
- ---------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Invested in STI Clasic Growth of $10,000
Small Cap Equity Fund, Invested in the Frank
Trust Shares Russell 2000 Index
Period Ended
1/31/97 $10,000 $10,000
5/31/97 11,097 10,360
*Commenced operations on January 31, 1997.
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
7
<PAGE>
STI CLASSIC CAPITAL GROWTH FUND
- --------------------------------------------------------------------------------
The STI Classic Capital Growth Fund (the "Fund") seeks capital appreciation by
investing primarily in stocks which, in the advisor's opinion are undervalued in
the marketplace at the time of purchase.
Large capitalization stocks with a strong growth history are the primary
consideration for this investment philosophy. Out of this universe of companies,
a security is selected for the portfolio when it appears undervalued based on
the relative earnings ratios. In order to make this relative value comparison,
each stock is compared to its own historical price earnings ratio range, to
other stocks in the sector, and to the stock market as measured by indices such
as the Standard & Poor's 500 Index.
Our strong performance -- particularly in comparison with other growth managers
- -- was partly due to heavy concentration in the aerospace conglomerate area,
with such holdings as Allied Signal, Textron, United Technology and Tyco. In
addition, the Fund benefited from a large position in Microsoft, which was one
of the few technology stocks to perform reasonably well during the quarter. The
style also benefited from its low weighting in commodity chemicals, financial
services, papers and utilities, all of which tend to be negatively impacted by
rising interest rates and efforts by the Federal Reserve Board to slow down the
economy.
Sincerely,
/s/ ANTHONY R. GRAY
Anthony R. Gray
President, Chief Investment Officer
8
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- -------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- -------------------------------------------------------------------
24.66% 19.68% 15.98% 107.19%
- -------------------------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
Growth of $10,000
Invested in the STI Growth of $10,000 Growth of $10,000
Classic Capital Growth Invested in the S&P Invested in the Lipper
Fund, Trust Shares 500 Composite Index Growth Funds Average
Period Ended
7/31/92 $10,000 $10,000 $10,000
5/31/93 11,203 10,885 11,206
5/31/94 11,638 11,345 11,780
5/31/95 12,409 13,631 13,390
5/31/96 16,004 17,505 17,350
5/31/97 19,951 22,652 20,424
Investor Shares
- -----------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- -----------------------------------------------------------------
23.74% 18.88% 15.86% 108.05% Without load
- -----------------------------------------------------------------
19.10% 17.37% 14.98% 100.24% With load
- -----------------------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
Growth of $10,000
Invested in the STI Growth of $10,000 Growth of $10,000
Classic Capital Growth Invested in the S&P Invested in the Lipper
Fund, Investor Shares 500 Composite Index Growth Funds Average
Period Ended
6/30/92 $ 9,625 $10,000 $10,000
5/31/93 11,206 11,329 11,607
5/31/94 11,572 11,808 12,202
5/31/95 12,258 14,187 13,870
5/31/96 15,712 18,219 17,971
5/31/97 19,442 23,576 21,155
Flex Shares
- ---------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ---------------------------------------------------------
23.24% 25.34% 57.10% Without load
- ---------------------------------------------------------
21.24% 25.34% 57.10% With load
- ---------------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
Growth of $10,000
Invested in the STI Growth of $10,000 Growth of $10,000
Classic Capital Growth Invested in the S&P Invested in the Lipper
Fund, Flex Shares 500 Composite Index Growth Funds Average
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 12,387 12,549 12,432
5/31/97 15,266 16,239 14,635
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
9
<PAGE>
STI CLASSIC BALANCED FUND
- --------------------------------------------------------------------------------
The STI Classic Balanced Fund (the "Fund") seeks capital appreciation and
current income through investments in a diversified portfolio of common stocks,
bonds and money market securities.
The Fund uses a bottom-up selection process to find stocks of high quality
companies with a history of earnings growth. Bonds are selected by attempting to
exploit undervalued bond sectors and areas along the yield curve. No more than
70% of the total assets of the Fund are invested in stocks, and no more than 60%
are invested in bonds. At least 20% of the Fund 's total assets will be in
senior fixed income securities.
Strong performance for the equity allocation of the Fund was due to its
concentration in the aerospace conglomerate area, with such holdings as Allied
Signal, Textron and Tyco. The Fund's performance also benefited from its low
weighting in commodity chemicals, financial services, papers and utilities, all
of which tend to be negatively impacted by rising interest rates.
During a period of rising interest rates, it is advantageous to have a shorter
than average maturity structure in a bond portfolio. We maintained such a
posture during the quarter, which helped limit the impact of the interest rate
hike. The Federal Reserve Board's Chairman, Alan Greenspan, indicated that the
rate increase might just be the "first step" and not the final move. We have
positioned the Fund accordingly.
/s/ ANTHONY R. GRAY
Anthony R. Gray
President and Chief Investment Officer
/s/ L. EARL DENNEY
L. Earl Denney, CFA
Managing Director
10
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- -------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- -------------------------------------------------------------------
16.66% 14.14% 11.77% 46.06%
- -------------------------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
<TABLE>
<CAPTION>
Growth of
$10,000 Invested Growth of $10,000 Growth of $10,000 Growth of
in the STI Classic Invested in Invested in the Lehman $10,000 Lipper
Balanced Fund, the S&P 500 Government/Corporate Balanced Funds
Trust Shares Composite Index Bond Index Average
Period Ended
<C> <C> <C> <C> <C>
1/31/94 $10,000 $10,000 $10,000 $10,000
5/31/94 9,554 9,579 9,446 9,505
5/31/95 10,387 11,510 10,543 10,632
5/31/96 12,180 14,781 10,975 12,505
5/31/97 14,210 19,126 11,842 14,525
</TABLE>
Investor Shares
- --------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- --------------------------------------------------------------------
16.27% 13.74% 11.32% 44.07% Without load
- --------------------------------------------------------------------
11.92% 12.31% 10.07% 38.66% With load
- --------------------------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
Period Ended
<TABLE>
<CAPTION>
Growth of
$10,000 Invested Growth of $10,000 Growth of $10,000 Growth of
in the STI Classic Invested in Invested in the Lehman $10,000 Lipper
Balanced Fund, the S&P 500 Government/Corporate Balanced Funds
Investor Shares Composite Index Bond Index Average
Period Ended
<C> <C> <C> <C> <C>
1/31/94 $ 9,625 $10,000 $10,000 $10,000
5/31/94 9,238 9,579 9,446 9,505
5/31/95 10,004 11,510 10,543 10,632
5/31/96 11,693 14,781 10,975 12,505
5/31/97 13,595 19,126 11,842 14,525
</TABLE>
Flex Shares
- --------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- --------------------------------------------------
15.40% 15.51% 32.75% Without load
- --------------------------------------------------
13.40% 15.51% 32.75% With load
- --------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
<TABLE>
<CAPTION>
Growth of
$10,000 Invested Growth of $10,000 Growth of $10,000 Growth of
in the STI Classic Invested in Invested in the Lehman $10,000 Lipper
Balanced Fund, the S&P 500 Government/Corporate Balanced Funds
Flex Shares Composite Index Bond Index Average
Period Ended
<C> <C> <C> <C> <C>
6/30/95 $10,000 $10,000 $10,000 $10,000
5/31/96 11,401 12,549 10,327 11,536
5/31/97 13,157 16,239 11,143 13,399
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
</TABLE>
11
<PAGE>
STI CLASSIC EMERGING MARKETS EQUITY FUND
- --------------------------------------------------------------------------------
The STI Classic Emerging Markets Equity Fund (the "Fund") seeks long-term
capital appreciation by investing primarily in equity securities of companies
located in emerging markets that appear undervalued relative to their global
peers.
Emerging markets performances for the year were led by Eastern Europe and Latin
America. The Fund's overweighted positions in these two regions aided our
performance for the year compared to the Fund's benchmark, Morgan Stanley
Capital International ("MSCI") Emerging Markets Free Index.
The Fund's Asian exposure is underweight relative to the Index. This is based on
our belief that the region and the stocks within the region were overvalued. Our
reasoning is that as economies become more global, prices for goods and services
will become more competitive. The company which can produce higher quality
products at the lowest cost will be more profitable and attract more investors.
We feel that each and every company should be viewed on its own valuation
regardless of where its stock trades, and therefore focus on industries and
companies with better valuations.
A few of the Fund's brightest stars were Telebras, Brazil's telecommunication
system which was aided by favorable regulatory issues and a low relative
valuation, and Gedeon Richter, Hungary's main manufacturer of pharmaceutical
products for the heart and central nervous system. In India, Hindalco, a major
aluminum producer, has also contributed to the performance of the Fund. It is
one of the lowest cost producers in the world and is benefiting from the
expectation that metal prices will strengthen.
/s/ NED DAU
Ned Dau
Managing Director
12
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance is a
line graph depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmark.
Trust Shares*
- ---------------------------------------------------------
Three Cumulative
Month Inception
Return to Date
- ---------------------------------------------------------
3.45% 7.90%
- ---------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Invested in the STI Growth of $10,000
Classic Emerging Invested in the MSCI
Markets Equity Fund Emerging Markets
Trust Shares Free Index
Period Ended
1/31/97 $10,000 $10,000
5/31/97 10,790 10,365
*Commenced operations on January 31, 1997.
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
13
<PAGE>
STI CLASSIC INTERNATIONAL EQUITY INDEX FUND
- --------------------------------------------------------------------------------
The STI Classic International Equity Index Fund (the "Fund") seeks to provide
investment results that correspond to the aggregate price and dividend
performance of the securities included in the Morgan Stanley Capital
International Europe, Australasia, Far East Gross Domestic Product Index (the
"MSCI EAFE-GDP Index"). The Fund has been constructed to have the aggregate
investment characteristics similar to those of the MSCI EAFE-GDP Index. The Fund
limits investments to a representative sample of securities contained within the
Index. Not all securities or countries in the Index will be held in the Fund.
Securities are selected using a statistically-based optimization process. No
attempt is made to manage the Fund using traditional economic, financial and
market analysis. All securities are purchased and held in their local
currencies.
For the year ending May 31, 1997, the Fund met its objective. The Fund's
correlation to the MSCI EAFE-GDP Index was .99. This exceeded the expected
annual correlation of over .951. The Fund's overall performance for the fiscal
year was similar to the MSCI EAFE-GDP Index on a post fee adjusted basis.
/s/ ROBERT J. RHODES, CFA
Robert J. Rhodes, CFA
Group Vice President
/s/ STANLEY J. CHERNY
Stanley J. Cherny
Vice President
- ------------
1Prospectus, Trust Shares, STI Classic Funds, dated October 1, 1996, page 12.
14
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmark.
Trust Shares
- --------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ---------------------------------------------------------
7.48% 6.48% 20.62%
- ---------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the MSCI
Classic International EAFE-GDP Weighted,
Equity Index Fund, Index in U.S.
Trust Shares $(Price Return)
Period Ended
6/30/94 $10,000 $10,000
5/31/95 10,331 10,343
5/31/96 11,291 11,255
5/31/97 12,135 12,066
Investor Shares
- ------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ------------------------------------------------------
7.12% 6.06% 19.20% Without load
- ------------------------------------------------------
3.14% 4.71% 14.72% With load
- ------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the MSCI
Classic International EAFE-GDP Weighted,
Equity Index Fund, Index in U.S.
Investor Shares $(Price Return)
Period Ended
6/30/94 $ 9,625 $10,000
5/31/95 9,904 10,343
5/31/96 10,786 11,255
5/31/97 11,554 12,066
Flex Shares
- ---------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ---------------------------------------------------------
6.41% 7.34% 15.07% Without load
- ---------------------------------------------------------
4.41% 7.34% 15.07% With load
- ---------------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the MSCI
Classic International EAFE-GDP Weighted,
Equity Index Fund, Index in U.S.
Flex Shares $(Price Return)
Period Ended
6/30/95 $10,000 $10,000
5/31/96 10,911 11,019
5/31/97 11,610 11,813
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
15
<PAGE>
STI CLASSIC INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
The STI Classic International Equity Fund (the "Fund") invests in equity
securities of foreign issuers and seeks to provide long term capital
appreciation. We strive to obtain investment results that outperform the
international markets and the average international mutual fund. The Fund
focuses on sector and company fundamentals specifically looking for companies
which exhibit top managements, quality products and sound financial positions.
Our goal is to find companies which fit the above criteria but are selling at a
discount to their global peers.
During the past year, the Fund's under weighting in the Japanese market and its
relative over weighting in the European markets contributed to the strong
return. On a sector basis, the Fund's overweight position in capital equipment
and consumer goods sector was a positive factor in its relative out performance.
Our current stock selection process continues to lead us to overweight the
capital equipment and the consumer goods sector based on bottom up company
valuations. Our other weightings which deviate from the index averages include
services and energy where we are underweighted.
Geographically our largest exposure remains Europe. As we view the world on an
industry and regional basis we continue to find financially solid companies with
appealing valuations in Europe. Emerging markets continue to show good relative
valuations, particularly in the Latin and South American markets where
fundamentals are improving and we maintain an overweight position.
The Fund's largest market weighting deviation continues to be underweight in the
Japanese market. While the Japanese economy appears to be showing signs of life
and some companies have improved their competitive position by moving
manufacturing offshore, we continue to believe that on valuation measures, the
Japanese market remains expensive to its global industry peers, and thus we
remain underweight.
/s/ NED DAU
Ned Dau
Managing Director
16
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmark.
Trust Shares
- --------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ---------------------------------------------------------
23.29% 25.50% 40.56%
- ---------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Invested in the STI Growth of $10,000
Classic International Invested in the MSCI
Equity Fund, EAFE Index,
Trust Shares in U.S.$
Period Ended
12/31/95 $10,000 $10,000
5/31/96 10,973 10,393
5/31/97 13,528 11,178
Investor Shares
- ------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ------------------------------------------------------
22.85% 22.99% 33.91% Without load
- ------------------------------------------------------
18.28% 19.68% 28.85% With load
- ------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Invested in the STI Growth of $10,000
Classic International Invested in the MSCI
Equity Fund, EAFE Index,
Investor Shares in U.S.$
Period Ended
1/31/96 $ 9,625 $10,000
5/31/96 10,421 10,351
5/31/97 12,802 11,132
Flex Shares
- ------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ------------------------------------------------------
21.98% 22.30% 32.85% Without load
- ------------------------------------------------------
19.98% 22.30% 32.85% With load
- ------------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
Growth of $10,000
Invested in the STI Growth of $10,000
Classic International Invested in the MSCI
Equity Index Fund, EAFE Index,
Flex Shares in U.S.$
Period Ended
1/31/96 $10,000 $10,000
5/31/96 10,818 10,351
5/31/97 13,196 11,132
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
17
<PAGE>
STI CLASSIC SUNBELT EQUITY FUND
- --------------------------------------------------------------------------------
The objective of the STI Classic Sunbelt Equity Fund (the "Fund") is to provide
capital appreciation by investing in U.S. companies located in the Sunbelt
region. The Fund's philosophy is centered on the belief that a portfolio of
companies with positive earnings trends will generate above average returns over
time. This focus on favorable earnings characteristics has been and remains the
Fund's cornerstone.
The Fund invests in companies which are headquartered or conduct the majority of
their business in the twelve state Sunbelt region which runs from Virginia down
to Florida and over to Texas. The favorable economic and demographic trends in
the Sunbelt have resulted in a vibrant and growing business climate. Such an
environment leads to above average investment opportunities. Key trends in the
Sunbelt are low cost levels, an excellent transportation system, expansion in
personal income and growth in population.
The Fund's investment universe consists of approximately 1,400 public companies,
of which roughly 270 are covered extensively by our nine dedicated research
analysts. Before a company can be considered for investment, it must satisfy
initial screening criteria which include: five year operating history, market
capitalization of a least $50 million, monthly trading volume of $20 million,
management continuity and strong fundamental history. Once the initial screening
is complete, the stocks chosen for purchase generally have strong or improving
growth rates, a demonstrated ability to meet expectations and rising estimates.
Over time, the companies owned in the Fund have shown above average earnings
growth rates. The above average growth rates have continued through the Fund's
1997 fiscal year and are a direct result of the Fund's bottom up orientation.
Yet the Fund's performance did not reflect these favorable earnings trends and
fundamentals. The reason is that the Sunbelt region is biased towards small and
mid-sized companies. The smaller stocks were overlooked during the past twelve
months as the stock market was dominated by investors seeking larger more liquid
stocks. Recently, smaller more growth-oriented stocks, including those owned in
the Fund, have rebounded as the large companies' earnings growth has become more
suspect. The Fund is expected to continue to benefit from this shift.
/s/ JAMES P. FOSTER
James P. Foster
Vice President
18
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
TRUST SHARES
- -------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- -------------------------------------------------------------------
1.48% 14.69% 11.83% 46.34%
- -------------------------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
Growth of Growth of Growth of
$10,000 Invested $10,000 Invested $10,000 Invested
in the STI Classic in the S&P 600 in the Frank
Sunbelt Equity Small Cap Index Russell 2000
Fund, Trust Growth Index (1)
Shares
Period Ended
1/31/94 $10,000 $10,000 $10,000
5/31/94 9,530 9,209 9,149
5/31/95 9,893 10,110 10,309
5/31/96 14,165 13,995 14,907
5/31/97 14,375 15,671 14,102
Investor Shares
- ---------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- ---------------------------------------------------------------
1.05% 14.14% 11.32% 44.08% Without load
- ---------------------------------------------------------------
-2.71% 12.68% 10.08% 38.68% With load
- ---------------------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
Growth of Growth of Growth of
$10,000 Invested $10,000 Invested $10,000 Invested
in the STI Classic in the S&P 600 in the Frank
Sunbelt Equity Small Cap Index Russell 2000
Fund, Investor Growth Index (1)
Shares
Period Ended
1/31/94 $ 9,625 $10,000 $10,000
5/31/94 9,162 9,209 9,149
5/31/95 9,455 10,110 10,309
5/31/96 13,481 13,995 14,907
5/31/97 13,622 15,671 14,102
Flex Shares
- -------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- -------------------------------------------------------
0.46% 18.46% 40.07% Without load
- -------------------------------------------------------
-1.40% 18.46% 40.07% With load
- -------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of Growth of Growth of
$10,000 Invested $10,000 Invested $10,000 Invested
in the STI Classic in the S&P 600 in the Frank
Sunbelt Equity Small Cap Index Russell 2000
Fund, Flex Growth Index (1)
Shares
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 13,571 13,122 13,528
5/31/97 13,633 14,695 12,797
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
(1) In the current year, the Fund changed its benchmark index from the S&P 600
Small Cap Index to the Frank Russell 2000 Growth Index. The new index more
accurately reflects the investment strategies and objectives of the Fund.
Future comparisons will be based solely on the new index.
19
<PAGE>
STI CLASSIC INVESTMENT GRADE TAX-EXEMPT BOND FUND
- --------------------------------------------------------------------------------
The STI Classic Investment Grade Tax-Exempt Bond Fund (the "Fund") seeks to
provide as high a level of total return through current income and capital
appreciation as is consistent with the preservation of capital by investing in
investment grade fixed income securities.
In the municipal bond market we try to limit risk as much as possible. We do not
make major maturity shifts. We will bias the Fund based upon our near term
fundamental and technical analysis, however, these will be moderate maturity
shifts. Our style of investing enables us to enhance performance by utilizing
various techniques. One such technique is emphasizing cheap sectors of the yield
curve. Another is to be a relative value investor, we try to overweight
undervalued sectors and underweight overvalued sectors. Also, we take advantage
of changes in yield spreads. We buy specific bonds when spreads are trading
historically wide and sell when the spreads are trading historically narrow.
Credit analysis is an important technique especially in today's market. We try
to identify and invest in improving credits and avoid those credits which are
deteriorating. The underlying concept to all these techniques is to enhance
total return without adding risk.
Due to rising interest rates, fixed-income funds of all types had a difficult
six months. However, tax-exempt bonds performed relatively well compared to U.S.
Treasuries. As is typical for the municipal market, the supply of bonds was
light during January and February, keeping prices firm. For instance, a
five-year AAA municipal bond was priced to yield about 70% of similar maturity
U.S. Treasuries, which is slightly lower than average. Since bond prices move in
the opposite direction to bond yields, that means that municipal bond prices
were higher than normal in relation to U.S. Treasuries.
/s/ Ronald H. Schwartz
Ronald H. Schwartz, CFA, CFP
Managing Director
20
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- --------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- --------------------------------------------------------------------
7.13% 7.70% 6.04% 23.58%
- --------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Immediate
Classic Investment Brothers 5 Year G.O. Municipal Debt
Grade Tax-Exempt Index Average
Bond Fund, Trust
Shares
Period Ended
10/31/93 $10,000 $10,000 $10,000
5/31/94 9,976 9,943 9,828
5/31/95 10,995 10,627 10,518
5/31/96 11,635 11,131 10,934
5/31/97 12,464 11,807 11,615
Investor Shares
- ---------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- ---------------------------------------------------------------
6.69% 7.32% 7.80% 45.33% Without load
- ---------------------------------------------------------------
2.72 5.95% 6.98% 39.88% With load
- ---------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Immediate
Classic Investment Brothers 5 Year G.O. Municipal Debt
Grade Tax-Exempt Index Average
Bond Fund, Investor
Shares
Period Ended
6/30/92 $ 9,625 $10,000 $10,000
5/31/93 10,731 10,778 10,891
5/31/94 11,309 11,112 11,213
5/31/95 12,429 11,877 12,001
5/31/96 13,101 12,440 12,475
5/31/97 13,977 13,196 13,252
Flex Shares
- ------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ------------------------------------------------------
6.19% 5.55% 11.41% Without load
- ------------------------------------------------------
4.19% 5.55% 11.41% With load
- ------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Immediate
Classic Investment Brothers 5 Year G.O. Municipal Debt
Grade Tax-Exempt Index Average
Bond Fund, Flex
Shares
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 10,541 10,465 10,439
5/31/97 11,193 11,102 11,089
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
21
<PAGE>
STI CLASSIC FLORIDA TAX-EXEMPT BOND FUND
- --------------------------------------------------------------------------------
The STI Classic Florida Tax-Exempt Bond Fund (the "Fund") seeks to provide
current income exempt from regular federal income tax by investing in municipal
bonds issued by the state of Florida and its municipalities.
In the municipal bond market we try to limit risk as much as possible. We do not
make major maturity shifts. We will bias the Fund based upon our near term
fundamental and technical analysis, however, these will be moderate maturity
shifts. Our style of investing enables us to enhance performance by utilizing
various techniques. One such technique is emphasizing cheap sectors of the yield
curve. Another is to be a relative value investor, we try to overweight
undervalued sectors and underweight overvalued sectors. Also, we take advantage
of changes in yield spreads. We buy specific bonds when spreads are trading
historically wide and sell when the spreads are trading historically narrow.
Credit analysis is an important technique especially in today's market. We try
to identify and invest in improving credits and avoid those credits which are
deteriorating. The underlying concept to all these techniques is to enhance
total return without adding risk.
Due to rising interest rates, fixed-income funds of all types had a difficult
six months. However, tax-exempt bonds performed relatively well compared to U.S.
Treasuries. As is typical for the municipal market, the supply of bonds was
light during January and February, keeping prices firm. For instance, a
five-year AAA municipal bond was priced to yield about 70% of similar maturity
U.S. Treasuries, which is slightly lower than average. Since bond prices move in
the opposite direction to bond yields, that means that municipal bond prices
were higher than normal in relation to U.S.
Treasuries.
/s/ RONALD H. SCHWARTZ
Ronald H. Schwartz,CFA, CFP
Managing Director
22
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- -------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- -------------------------------------------------------------------
7.22% 6.76% 5.66% 20.24%
- -------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Florida
Classic Florida Tax- 10-Year Municipal Municipal Debt
Exempt Bond Fund, Bond Index Average
Trust Shares
Period Ended
1/31/94 $10,000 $10,000 $10,000
5/31/94 9,786 9,533 9,354
5/31/95 10,692 10,389 10,203
5/31/96 11,106 10,880 10,548
5/31/97 11,908 11,769 11,335
Investor Shares
- ---------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- ---------------------------------------------------------------
7.00% 6.58% 5.46% 19.59% Without load
- ---------------------------------------------------------------
3.01% 5.23% 4.27% 15.10% With load
- ---------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Florida
Classic Florida Tax- 10-Year Municipal Municipal Debt
Exempt Bond Fund, Bond Index Average
Investor Shares
Period Ended
1/31/94 $ 9,625 $10,000 $10,000
5/31/94 9,418 9,533 9,354
5/31/95 10,270 10,389 10,203
5/31/96 10,656 10,880 10,548
5/31/97 11,402 11,769 11,335
Flex Shares
- ------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ------------------------------------------------------
6.48% 4.86% 9.96% Without load
- ------------------------------------------------------
4.48% 4.86% 9.96% With load
- ------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Florida
Classic Florida Tax- 10-Year Municipal Municipal Debt
Exempt Bond Fund, Bond Index Average
Flex Shares
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 10,424 10,539 10,484
5/31/97 11,099 11,400 11,266
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
23
<PAGE>
STI CLASSIC TENNESSEE TAX-EXEMPT BOND FUND
- --------------------------------------------------------------------------------
The STI Classic Tennessee Tax-Exempt Bond Fund (the "Fund") seeks to provide
current income exempt from regular federal and state income tax by investing in
municipal bonds issued by the state of Tennessee and its municipalities.
In the municipal bond market we try to limit risk as much as possible. We do not
make major maturity shifts. We will bias the Fund based upon our near term
fundamental and technical analysis, however, these will be moderate maturity
shifts. Our style of investing enables us to enhance performance by emphasizing
cheap sectors of the yield curve, overweighting undervalued sectors and
underweighting overvalued sectors. Another technique is credit analysis, where
we try to identify and invest in improving credits and avoid those credits which
are deteriorating.
Due to rising interest rates, fixed-income funds of all types had a difficult
six months. However, tax-exempt bonds performed relatively well compared to U.S.
Treasuries. As is typical for the municipal market, the supply of bonds was
light during January and February, keeping prices firm. For instance, a
five-year AAA municipal bond was priced to yield about 70% of similar maturity
U.S. Treasuries, which is slightly lower than average. Since bond prices move in
the opposite direction to bond yields, that means that municipal bond prices
were higher than normal in relation to U.S. Treasuries.
/s/ RONALD H. SCHWARTZ
Ronald H. Schwartz, CFA, CFP
Managing Director
24
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- -------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- -------------------------------------------------------------------
7.16% 6.23% 3.47% 12.08%
- -------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Tennessee
Classic Tennessee Tax- 10-Year Municipal Municipal Debt
Exempt Bond Fund, Bond Index Average
Trust Shares
Period Ended
1/31/94 $10,000 $10,000 $10,000
5/31/94 9,282 9,533 9,430
5/31/95 10,040 10,389 10,189
5/31/96 10,385 10,880 10,564
5/31/97 11,128 11,769 11,350
Investor Shares
- ------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- ------------------------------------------------------------
6.93% 6.13% 3.40% 11.89% Without load
- ------------------------------------------------------------
2.89% 4.78% 2.23% 7.69% With load
- ------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Tennessee
Classic Tennessee Tax- 10-Year Municipal Municipal Debt
Exempt Bond Fund, Bond Index Average
Investor Shares
Period Ended
1/31/94 $ 9,625 $10,000 $10,000
5/31/94 8,942 9,533 9,430
5/31/95 9,679 10,389 10,189
5/31/96 9,996 10,880 10,564
5/31/97 10,689 11,769 11,350
Flex Shares
- ------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ------------------------------------------------------
6.42% 4.19% 8.50% Without load
- ------------------------------------------------------
4.42% 4.19% 8.50% With load
- ------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Tennessee
Classic Tennessee Tax- 10-Year Municipal Municipal Debt
Exempt Bond Fund, Bond Index Average
Flex Shares
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 10,401 10,539 10,477
5/31/97 11,068 11,400 11,257
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
25
<PAGE>
STI CLASSIC GEORGIA TAX-EXEMPT BOND FUND
- --------------------------------------------------------------------------------
The STI Classic Georgia Tax-Exempt Bond Fund (the Fund") seeks to provide
current income exempt from federal and state income taxes for Georgia residents
without undue investment risk. Total return for the Fund includes current income
as well as changes in the value of the Fund's assets. As of May 31, 1997, the
Fund had an average maturity of 9.4 years and a one year annualized total return
of 6.79% which compared with the Lipper Georgia Municipal Debt at 7.68%. The
Lehman Ten Year Municipal Bond Index, which does not include Fund expenses, had
an annual return of 8.17%. The lower return for the Fund reflects our
conservative strategy which tends to better protect our participants from undue
principal risk if interest rates rise. As a consequence, returns on the Fund may
lag the indices if interest rates fall which was the case for this fiscal year.
Our investment philosophy in the municipal market is to provide our
shareholders, as conservative investors, with high quality investments, income
stability, and a favorable risk/return ratio. In keeping with our philosophy we
look for value within the state of Georgia utilizing internal as well as outside
credit analysis to identify areas in the state that are possible quality upgrade
candidates, monitoring shifts within the Georgia market which may create
investment opportunities and subsequently allow the Fund to achieve gains, while
at the same time maintaining a geographical diversity to minimize credit risk.
Given our philosophy, and in light of the market's volatile nature in recent
years, we are maintaining a relatively defensive position. The average maturity
and duration may vary slightly in the future however, depending on our outlook
for the market.
The municipal market was volatile in the second half of 1996 as well as during
the first half of 1997 as investors nervously watched economic data trying to
determine if a possible rise in inflation was indicated. The economy showed
strength while inflation remained low. However, in a much anticipated move the
Federal Reserve Board (the "Fed") raised short term interest rates in March
1997. Investors continued to monitor the economic data and many expected the Fed
to tighten again in May 1997, but there was no move at that time, which has led
to speculation that additional Fed action may be taken to raise interest rates
later this year.
Municipal yields fell in the second half of 1996 with prices peaking in
December. Despite rallies in December 1996 and February 1997 interest rates
gradually rose until early May 1997 when they began to fall again. With all the
volatility experienced during the fiscal year, there was very little net change
in the short rates. Long term rates saw the biggest move with a price increase
of almost thirty-five basis points.
The current data being released is mixed as to the direction of the economy so
many investors are reluctant to commit resources. Sporadic supply and investors'
wavering enthusiasm for bonds has resulted in the market trading in a fairly
narrow range. That trend will likely continue near term.
The Georgia municipal market, in the first half of 1997, experienced heavy
volume in new school district deals, all with short maturities. Issuance of
other Georgia bonds was lighter, but fairly active. As a result of the current
appetite for Georgia municipal bonds, all were well received by investors. We
should continue to see greater volume in new Georgia deals throughout the rest
of 1997.
/s/ GAY B. CASH
Gay B. Cash
Vice President
26
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment as $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- -------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- -------------------------------------------------------------------
6.79% 5.87% 3.81% 13.40%
- -------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Georgia
Classic Georgia Tax- 10-Year Municipal Municipal Debt
Exempt Bond Fund, Bond Index Average
Trust Shares
Period Ended
1/31/94 $10,000 $10,000 $10,000
5/31/94 9,529 9,533 9,338
5/31/95 10,190 10,389 10,124
5/31/96 10,587 10,880 10,496
5/31/97 11,305 11,769 11,302
Investor Shares
- -------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- -------------------------------------------------------------------
6.47% 5.61% 3.63% 12.75% Without load
- -------------------------------------------------------------------
2.51% 4.27% 2.46% 8.52% With load
- -------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Georgia
Classic Georgia Tax- 10-Year Municipal Municipal Debt
Exempt Bond Fund, Bond Index Average
Investor Shares
Period Ended
1/31/94 $ 9,625 $10,000 $10,000
5/31/94 9,171 9,533 9,338
5/31/95 9,785 10,389 10,124
5/31/96 10,147 10,880 10,496
5/31/97 10,803 11,769 11,302
Flex Shares
- ------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ------------------------------------------------------
6.06% 4.15% 8.41% Without load
- ------------------------------------------------------
4.06% 4.15% 8.41% With load
- ------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Georgia
Classic Georgia Tax- 10-Year Municipal Municipal Debt
Exempt Bond Fund, Bond Index Average
Flex Shares
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 10,370 10,539 10,482
5/31/97 10,998 11,400 11,287
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
27
<PAGE>
STI CLASSIC INVESTMENT GRADE BOND FUND
- --------------------------------------------------------------------------------
The STI Classic Investment Grade Bond Fund (the "Fund") seeks to provide as high
a level of total return through current income and capital appreciation as is
consistent with the preservation of capital by investing in corporate investment
grade bonds and U.S. government securities.
The Fund utilizes an investment philosophy which minimizes risk, while
attempting to outperform selected market indices. The core portfolio is
structured around the composition of the Lehman Brothers Government/ Corporate
Bond Index. The composition of the index is reviewed and quantitative historical
data is analyzed to determine the optimal spread ranges of the different market
sectors.
Once the optimum market sectors are selected, an over- or under-weighting is
developed in different sectors by investing in well-valued issues. All
securities purchased are carefully reviewed for value. Yield curve analysis and
credit ratings are an important part of this process.
Over the last year, mortgage-backed securities and corporate bonds have tended
to outperform U.S. Treasury bonds. Because mortgage outperformed strongly in the
beginning of the calendar year, we reduced the Fund's allocation by about 15%.
Meanwhile we increased our allocation of corporate bonds by about 10%.
/s/ L. EARL DENNEY
L. Earl Denney, CFA
Managing Director
28
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment as $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- --------------------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- --------------------------------------------------------------------------------
6.99% 7.10% 6.26% 34.44%
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Intermediate
Classic Investment Government/Corporate Investment Grade Debt
Grade Bond Fund, Trust Bond Index Average
Shares
Period Ended
7/31/92 $10,000 $10,000 $10,000
5/31/93 10,736 10,788 10,698
5/31/94 10,861 10,897 10,737
5/31/95 11,990 12,162 11,813
5/31/96 12,472 12,660 12,255
5/31/97 13,344 13,661 13,182
Investor Shares
- --------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- --------------------------------------------------------------
6.66% 6.70% 5.99% 33.54% Without load
- --------------------------------------------------------------
2.68% 5.34% 5.18% 28.52% With load
- --------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Intermediate
Classic Investment Government/Corporate Investment Grade Debt
Grade Bond Fund, Trust Bond Index Average
Shares
Period Ended
6/30/92 $ 9,625 $10,000 $10,000
5/31/93 10,486 11,064 10,941
5/31/94 10,577 11,176 10,981
5/31/95 11,639 12,473 12,082
5/31/96 12,046 12,984 12,533
5/31/97 12,849 14,010 13,481
Flex Shares
- ---------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ---------------------------------------------------
6.16% 4.33% 8.77% Without load
- ---------------------------------------------------
4.16% 4.33% 8.77% With load
- ---------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lehman Lipper Intermediate
Classic Investment Government/Corporate Investment Grade Debt
Grade Bond Fund, Flex Bond Index Average
Shares
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 10,232 10,327 10,313
5/31/97 10,862 11,143 11,093
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
29
<PAGE>
STI CLASSIC SHORT-TERM BOND FUND
- --------------------------------------------------------------------------------
The investment objective of the STI Classic Short-Term Bond Fund (the "Fund") is
to provide as high a level of current income, relative to funds with like
investment objectives, as is consistent with the preservation of capital
primarily through investment in short to intermediate-term investment grade
fixed income securities. The Fund attempts to capture the yield advantage which
normally exists between money market instruments and short to intermediate-term
bonds. The price volatility of short to intermediate-term bonds is fairly modest
and over time it consistently has been offset by the incremental yield these
instruments offer relative to money market securities. The Fund is managed from
a total return perspective; that is, day to day decisions are made with a view
towards maximizing income and price appreciation. The investment discipline
applied in managing the Fund emphasizes adding value through yield curve, sector
and credit analysis. Investments are made in those sectors, credits, and
segments of the yield curve within the applicable universe which offer the most
attractive risk/reward trade-offs. For example, we study historical yield spread
data of the corporate and mortgage sectors and compare it with the current
environment to identify buying and selling opportunities between various
sectors. We also use internal credit analysis and screening to identify
opportunities in corporate bonds. We look for those instruments that offer
incremental yield for a given level of credit risk.
The total return earned by the Fund (Trust Shares) over the last twelve months
was 6.30%, as compared to 6.23% for the Salomon One-Year Treasury Benchmark
On-the-Run and 6.63% for the Salomon 1-3 year Treasury/Government
Sponsored/Corporate Index, neither of which include fees or expenses. The Fund's
return was approximately 1.35% above the average taxable money market fund. We
believe the Fund continues to meet or exceed its objective.
/s/ DAVID S. YEALY
David S. Yealy
Vice President
30
<PAGE>
Shown immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment as $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- --------------------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- --------------------------------------------------------------------------------
6.30% 6.11% 5.04% 23.02%
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Growth of $10,000 Growth of $10,000 Invested in the
Invested in the STI Invested in the Salomon Salomon One Year
Classic Short-Term 1-3 Year Treasury Benchmark
Bond Fund, Trust Treasury/Government On-the-Run
Shares Sponsored/Corporate
Index
Period Ended
3/31/93 $10,000 $10,000 $10,000
5/31/93 10,035 10,039 10,035
5/31/94 10,238 10,260 10,303
5/31/95 11,016 11,021 10,965
5/31/96 11,506 11,614 11,593
5/31/97 12,231 12,384 12,315
Investor Shares
- --------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- --------------------------------------------------------------
5.97% 5.87% 4.69% 21.20% Without load
- --------------------------------------------------------------
3.87% 5.16% 4.18% 18.72% With load
- --------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Growth of $10,000 Growth of $10,000 Invested in the
Invested in the STI Invested in the Salomon Salomon One Year
Classic Short-Term 1-3 Year Treasury Benchmark
Bond Fund, Investor Treasury/Government On-the-Run
Shares Sponsored/Corporate
Index
Period Ended
3/31/93 $ 9,800 $10,000 $10,000
5/31/93 9,838 10,039 10,035
5/31/94 10,017 10,260 10,303
5/31/95 10,762 11,021 10,965
5/31/96 11,218 11,614 11,593
5/31/97 11,887 12,384 12,315
Flex Shares
- ---------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ---------------------------------------------------
5.62% 4.70% 9.36% Without load
- ---------------------------------------------------
3.62% 4.70% 9.36% With load
- ---------------------------------------------------
GRAPH CHART (GRAPHIC OMITTED)
Comparison of Change in the Value of a $10,000 Investment
Growth of $10,000
Growth of $10,000 Growth of $10,000 Invested in the
Invested in the STI Invested in the Salomon Salomon One Year
Classic Short-Term 1-3 Year Treasury Benchmark
Bond Fund, Flex Treasury/Government On-the-Run
Shares Sponsored/Corporate
Index
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 10,359 10,481 10,511
5/31/97 10,941 11,176 11,166
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
31
<PAGE>
STI CLASSIC SHORT-TERM U.S. TREASURY SECURITIES FUND
- --------------------------------------------------------------------------------
The investment objective of STI Classic Short-Term U.S. Treasury Securities Fund
(the "Fund") is to provide as high a level of current income, relative to funds
with like investment objectives, as is consistent with the preservation of
capital through investment exclusively in short-term U.S. Treasury securities.
The goal of the Fund is to capture the yield advantage which normally exists
between money market instruments and short-term bonds. The price volatility of
short-term bonds is very modest and over time has consistently been offset by
the incremental yield of these instruments relative to money market securities.
The Fund is managed from a total return perspective, that is, day to day
decisions are made with a view toward maximizing income and price appreciation.
The investment discipline applied in managing the Fund emphasizes adding value
through yield curve analysis. Investments are made in those segments of the
yield curve within the applicable universe which offer the most attractive
risk/reward trade-off.
The total return earned by the Fund (Trust Shares) over the last twelve months
was 5.76%, as compared to 5.38% for the Salomon 6-month Treasury Bill Index. The
Fund's return was also approximately one percent above the average treasury
money market fund. We believe the Fund continues to meet or exceed its
objective.
/s/ DAVID S. YEALY
David S. Yealy
Vice President
32
<PAGE>
Shown Immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- --------------------------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- --------------------------------------------------------------------------------
5.76% 5.53% 4.56% 20.66%
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Salomon Invested in the
Classic Short-Term U.S. 1-3 Year Salomon 6 Month
Treasury Securities Treasury/Government Treasury Bill Index
Fund, Trust Shares Sponsored/Corporate
Period Ended Index
3/31/93 $10,000 $10,000 $10,000
5/31/93 10,024 10,039 10,053
5/31/94 10,242 10,260 10,391
5/31/95 10,868 11,021 10,953
5/31/96 11,382 11,614 11,554
5/31/97 12,038 12,384 12,176
Investor Shares
- -------------------------------------------------------------
One Year Annualized Annualized Cumulative
Return 3 Year Inception Inception
Return to Date to Date
- -------------------------------------------------------------
5.59% 5.38% 4.40% 19.83% Without load
- -------------------------------------------------------------
4.53% 5.03% 4.15% 18.65% With load
- -------------------------------------------------------------
Comparison of Change in the Value of a $10,000 investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000
Growth of $10,000 Invested in the Salomon
Invested in the STI 1-3 Year Growth of $10,000
Classic Short-Term U.S. Treasury/Government Invested in the
Treasury Securities Sponsored/Corporate Salomon 6 Month
Fund, Investor Shares Index Treasury Bill Index
Period Ended
3/31/93 $9,900 $10,000 $10,000
5/31/93 9,920 10,039 10,053
5/31/94 10,121 10,260 10,391
5/31/95 10,731 11,021 10,953
5/31/96 11,216 11,614 11,554
5/31/97 11,843 12,384 12,176
Flex Shares
- ---------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ---------------------------------------------------
5.19% 4.48% 8.88% Without load
- ---------------------------------------------------
3.19% 4.48% 8.88% With load
- ---------------------------------------------------
Comparison of Change in the Value of a $10,000 investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Salomon
Classic Short-Term U.S. 1-3 Year Growth of $10,000
Treasury Securities Treasury/Government Invested in the
Fund, Flex Shares Sponsored/Corporate Salomon 6 Month
Index Treasury Bill Index
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 10,357 10,481 10,500
5/31/97 10,894 11,176 11,065
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
33
<PAGE>
STI CLASSIC LIMITED-TERM FEDERAL MORTGAGE SECURITIES FUND
- --------------------------------------------------------------------------------
The STI Classic Limited-Term Federal Mortgage Securities Fund seeks to provide
as high a level of current income as is consistent with the preservation of
capital by investing in mortgage related securities issued or guaranteed by the
U.S. government.
There are three reasons that our style performed well during the past year: 1)
its short maturity, which is less sensitive to adverse interest rate movements;
2) its emphasis on income as the biggest component of total return; and 3) the
virtual elimination of credit risk by the absence of corporate securities. We
hold a mixture of Federal National Mortgage Association ("FNMA") balloon
mortgages, very seasoned Government National Mortgage Association ("GNMA") and
FNMA conventional mortgages, as well as high quality Collateralized Mortgage
Obligations ("CMOs") -- all combined to have an effective average maturity of
3.3 years. These government securities currently offer half a percentage point
to more than one percentage point more yield than U.S. Treasuries.
In the mortgage market, prepayment is a big concern. We minimize this risk by
holding securities that are less prone to this occurrence. Seasoned GNMA or FNMA
mortgages that have been outstanding for several years provide an advantage
because the mortgagees have had many opportunities to prepay them and have
chosen not to for whatever reason. If rates drop again, these mortgagees are
unlikely to prepay the loans. Similarly, the high quality CMOs that the
portfolio acquires are structured in such a way to minimize this prepayment
volatility risk.
/s/ L. EARL DENNEY
L. Earl Denney, CFA
Managing Director
/s/ DAVID WEST
David West, CFA
Principal
34
<PAGE>
Shown Immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmarks.
Trust Shares
- --------------------------------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- --------------------------------------------------------------------------------
6.43% 6.29% 19.95%
Comparison of Change in the Value of a $10,000 investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Merrill Invested in the
Classic Limited-Term Lynch 1-5 Year Lipper.
Federal Mortgage Short/Intermediate U.S. Short/Intermediate
Securities Fund, Trust Treasury Index U.S. Government Average
Shares
Period Ended
6/30/94 $10,000 $10,000 $10,000
5/31/95 10,756 10,809 10,737
5/31/96 11,276 11,341 11,175
5/31/97 12,002 12,110 11,887
Investor Shares
- ---------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ---------------------------------------------------
6.17% 6.35% 19.32% Without load
- ---------------------------------------------------
3.47% 5.40% 16.29% With load
- ---------------------------------------------------
Comparison of Change in the Value of a $10,000 investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Merrill Invested in the
Classic Limited-Term Lynch 1-5 Year Lipper Short/
Federal Mortgage Short/Intermediate U.S. Intermediate U.S.
Securities Fund, Investor Treasury Index Government Average
Shares
Period Ended
7/31/94 $ 9,750 $10,000 $10,000
5/31/95 10,440 10,697 10,634
5/31/96 11,919 11,223 11,068
5/31/97 11,593 11,984 11,773
Flex Shares
- ---------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- ---------------------------------------------------
5.80% 4.95% 10.06% Without load
- ---------------------------------------------------
3.80% 4.95% 10.06% With load
- ---------------------------------------------------
Comparison of Change in the Value of a $10,000 investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Merrill Invested in the
Classic Limited-Term Lynch 1-5 Year Lipper Short/
Federal Mortgage Short/Intermediate Intermediate U.S.
Securities Fund, Flex Treasury Index Government Average
Shares
Period Ended
6/30/95 $10,000 $10,000 $10,000
5/31/96 10,393 10,431 10,356
5/31/97 10,996 11,139 11,016
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
35
<PAGE>
STI CLASSIC U.S. GOVERNMENT SECURITIES FUND
- --------------------------------------------------------------------------------
The objective for the STI Classic U.S. Government Securities Fund (the "Fund")
is to provide as high a level of current income as is consistent with the
preservation of capital by investing in obligations issued or guaranteed by the
U.S. Government or its agencies or instrumentalities. We believe the Fund met
its objectives for the fiscal year of operations ending May 31, 1997. The Fund
(Trust Class) had an annualized one year total return of 7.54%. In addition, the
Fund was comprised of 28% U.S. Treasuries and 66% Government Agency
Mortgage-Backed Securities.
The fact that the yield on the benchmark 30 year U.S. Treasury bond ended May
31, 1997 was only 3 basis points lower than on May 31, 1996 (6.96% vs. 6.99%)
belies the volatility in interest rates that occurred within the one year
period. Indeed, the yield dropped as low as 6.42% in November 1996, only to rise
as high as 7.26% in April 1997. Amidst this volatility we continued to take
opportunities to increase income for shareholders when rates were higher. In
addition, we increased our allocation to the Government Agency MBS Sector which
performed very well during the period.
Despite recent growth spurts in the fourth quarter '96 and first quarter '97 we
feel overall that growth will continue on a moderate sustainable path and that
inflation will remain well controlled. We feel this will be a good environment
for bonds and have currently positioned the fund to take advantage of these
trends.
/s/ CHARLES B. LEONARD
Charles B. Leonard, CFA
First Vice President
/s/ MICHAEL L. FORD
Michael L. Ford
Associate
36
<PAGE>
Shown Immediately following the Advisor's Discussion of Fund Performance are
three line graphs depicting the growth (including reinvestment of dividends and
capital gains) of a hypothetical investment of $10,000 as compared with the
growth of a hypothetical investment of $10,000 in the Fund's benchmark.
Trust Shares
- --------------------------------------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- --------------------------------------------------------------------------------
7.54% 6.67% 20.06%
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lipper
Classic U.S. Intermediate
Government Securities Government Funds
Fund, Trust Shares Average
Period Ended
8/31/94 $10,000 $10,000
5/31/95 10,832 10,751
5/31/96 11,132 11,103
5/31/97 11,972 11,874
Investor Shares
- --------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- --------------------------------------------------
7.21% 6.09% 19.31% Without load
- --------------------------------------------------
3.14% 4.74% 14.83% With load
- --------------------------------------------------
Comparison of Change in the Value of a $10,000 investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lipper
Classic U.S. Intermediate
Government Securities Government Funds
Fund, Investor Shares Average
Period Ended
6/30/94 $ 9,625 $10,000
5/31/95 10,571 10,912
5/31/96 10,833 11,270
5/31/97 11,614 12,052
Flex Shares
- --------------------------------------------------
One Year Annualized Cumulative
Return Inception Inception
to Date to Date
- --------------------------------------------------
6.57% 3.98% 8.06% Without load
- --------------------------------------------------
4.57% 3.98% 8.06% With load
- --------------------------------------------------
Comparison of Change in the Value of a $10,000 investment
GRAPH CHART (GRAPHIC OMITTED)
Growth of $10,000 Growth of $10,000
Invested in the STI Invested in the Lipper
Classic U.S. Intermediate
Government Securities Government Funds
Fund, Flex Shares Average
Period Ended
6/30/95 $10,000 $10,000
5/31/96 10,144 10,264
5/31/97 10,810 10,977
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
37
<PAGE>
STI CLASSIC PRIME QUALITY MONEY MARKET FUND
- --------------------------------------------------------------------------------
The investment objective of the STI Classic Prime Quality Money Market Fund (the
"Fund") is to provide as high a level of current income as is consistent with
the preservation of capital and liquidity by investing exclusively in high
quality money market instruments. The investment discipline which we use in
managing the Fund emphasizes adding incremental value through yield curve,
sector and credit analysis. Investments are made in those sectors, credits, and
segments of the yield curve within the universe of money market eligible
securities which offer the most attractive risk/reward trade-off and current
yield. The maturity structure and average maturity of the Fund are actively
managed to maximize the yield of the Fund over time based on the current market
rates and conditions and on our market outlook.
The Federal Reserve raised the Federal Funds Rate one time during the fiscal
year ending May 31, 1997. Interest rates on short-term money market securities
and money market funds have followed the modest rise in the Federal Funds Rate.
During most of this period, the Fund maintained an extended average maturity in
order to maximize the yield of the Fund.
STI CLASSIC U.S. GOVERNMENT SECURITIES MONEY MARKET FUND
- --------------------------------------------------------------------------------
The investment objective of the STI Classic U.S. Government Securities Money
Market Fund (the "Fund") is to provide as high a level of current income as is
consistent with the preservation of capital and liquidity by investing
exclusively in money market eligible securities. Eligible securities include
U.S. Treasury securities, U.S. Government Subsidiary Corporation securities that
are backed by the full faith and credit of the U.S. Government, and repurchase
agreements ("repos") collateralized by U.S. Treasury obligations and U.S.
Government Subsidiary Corporation securities. The investment discipline which is
used in managing the Fund emphasizes adding incremental value through yield
curve analysis. The maturity structure and average maturity of the Fund are
actively managed to maximize the yield of the Fund over time based on the
current market rates and conditions and our market outlook.
The Federal Reserve raised the Federal Funds Rate one time during the fiscal
year ending May 31, 1997. Interest rates on short-term money market securities
and money market funds have followed the modest rise in the Federal Funds Rate.
During most of this period, the Fund maintained an extended average maturity in
order to maximize the yield of the Fund.
/s/ DAVID S. YEALY
David S. Yealy
Vice President
38
<PAGE>
STI CLASSIC TAX-EXEMPT MONEY MARKET FUND
- --------------------------------------------------------------------------------
The STI Classic Tax-Exempt Money Market Fund (the "Fund") seeks to provide as
high a level of current interest income exempt from regular federal income tax
as is consistent with preserving capital and liquidity. The Fund invests in high
quality, U.S. dollar-denominated municipal securities of issuers located in all
fifty states, the District of Columbia, and Puerto Rico.
The Federal Reserve raised the Federal Funds Rate one time during the fiscal
year ending May 31, 1997. Interest rates on short-term money market securities
and money market funds have followed the modest rise in the Federal Funds Rate.
During most of this period, the Fund maintained an extended average maturity in
order to maximize the yield of the Fund.
/s/ MARY F. CERNILLI
Mary F. Cernilli
Associate
39
<PAGE>
[This Page Left Intentionally Blank]
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and Board of Trustees of
STI Classic Funds:
We have audited the accompanying statements of net assets of the Value Income
Stock, Mid-Cap Equity, Small Cap Equity, Capital Growth, Balanced, Emerging
Markets Equity, International Equity Index, International Equity, Sunbelt
Equity, Investment Grade Tax-Exempt Bond, Florida Tax-Exempt Bond, Tennessee
Tax-Exempt Bond, Georgia Tax-Exempt Bond, Investment Grade Bond, Short-Term
Bond, Short-Term U.S. Treasury Securities, Limited-Term Federal Mortgage
Securities, U.S. Government Securities, Prime Quality Money Market, U.S.
Government Securities Money Market, and Tax-Exempt Money Market Funds of STI
Classic Funds (the "Trust") as of May 31, 1997, and the related statements of
operations, changes in net assets, and financial highlights for the periods
presented. These financial statements and financial highlights are the
responsibility of the Trust's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of May
31, 1997, by correspondence with the custodian and the application of
alternative auditing procedures with respect to unsettled securities
transactions. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Value Income Stock, Mid-Cap Equity, Small Cap Equity, Capital Growth, Balanced,
Emerging Markets Equity, International Equity Index, International Equity,
Sunbelt Equity, Investment Grade Tax-Exempt Bond, Florida Tax-Exempt Bond,
Tennessee Tax-Exempt Bond, Georgia Tax-Exempt Bond, Investment Grade Bond,
Short-Term Bond, Short-Term U.S. Treasury Securities, Limited-Term Federal
Mortgage Securities, U.S. Government Securities, Prime Quality Money Market,
U.S. Government Securities Money Market, and Tax-Exempt Money Market Funds of
STI Classic Funds as of May 31, 1997, the results of their operations, changes
in their net assets, and financial highlights for the periods presented, in
conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Philadelphia, PA
July 11, 1997
41
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
VALUE INCOME STOCK FUND
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
COMMON STOCKS (92.6%)
BASIC MATERIALS (14.8%)
Consolidated Papers 233,700 $ 12,737
Cyprus AMAX Minerals 707,200 17,238
Eastman Chemical 119,700 7,122
Ethyl 1,428,100 13,388
Georgia Pacific 246,700 21,771
Hercules 617,800 28,959
Imperial Chemical Industries 315,900 17,217
International Flavors
& Fragrances 592,100 26,274
International Paper 531,300 25,502
Nalco Chemical 394,600 14,650
Olin 464,700 19,053
Reynolds Metals 247,100 16,772
Union Camp 338,100 17,750
Witco Chemical 467,200 17,286
----------
Total Basic Materials 255,719
----------
CAPITAL GOODS (12.8%)
AMP 1,034,400 42,540
Cooper Industries 329,100 16,784
Federal Signal 198,300 5,057
Foster Wheeler 544,000 21,080
General Signal 563,300 23,729
National Service Industries 278,100 12,202
Pall 556,500 13,147
Tenneco 770,100 34,462
Thomas & Betts 362,200 18,427
Trinity Industries 319,800 9,594
Waste Management 769,100 24,419
----------
Total Capital Goods 221,441
----------
COMMUNICATIONS SERVICES (7.7%)
Alltel 538,700 17,710
BellSouth 460,200 20,882
Frontier 984,100 18,083
GTE 899,600 39,695
Southern New England
Telecommunications 577,200 22,511
Sprint 269,400 13,167
----------
Total Communication Services 132,048
----------
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
CONSUMER CYCLICALS (15.9%)
American Greetings, Cl A 514,900 $ 17,635
Dana 617,300 22,300
Echlin 597,300 19,935
Ford Motor 455,500 17,081
H & R Block 497,800 16,427
ITT Industries 1,291,700 31,970
J.C. Penney 767,200 39,511
Masco 428,800 16,670
May Department Stores 532,100 25,075
Maytag 683,900 18,294
McGraw-Hill 307,300 16,786
Mercantile Stores 287,700 15,464
Reader's Digest, Cl A 200,800 4,970
Shaw Industries 1,033,200 12,915
----------
Total Consumer Cyclicals 275,033
----------
CONSUMER STAPLES (9.3%)
Cadbury Schweppes
ADR 461,800 16,740
CPC International 271,900 23,383
Deluxe 261,600 8,502
Food Lion, Cl A 1,101,900 7,369
Kelly Services, Cl A 334,900 9,838
McCormick 617,100 16,122
R.R. Donnelley & Sons 660,200 24,510
Rubbermaid 896,400 24,987
UST 620,200 17,676
Whitman 495,500 11,954
----------
Total Consumer Staples 161,081
----------
ENERGY (9.2%)
Amoco 291,400 26,044
Chevron 358,900 25,123
Dresser Industries 753,100 25,794
Kerr-McGee 352,700 22,837
Mobil 179,400 25,094
Phillips Petroleum 612,900 26,048
Sun 278,200 8,311
----------
Total Energy 159,251
----------
42
<PAGE>
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
FINANCIALS (8.2%)
American Financial Group 435,700 $ 16,557
American General 397,500 17,589
AmSouth Bancorp 233,850 9,149
Central Fidelity Banks 292,000 8,541
Crestar Financial 259,600 9,865
First American Bank 127,400 8,775
First American of Tennessee 281,600 10,278
Hibernia, Cl A 651,800 8,636
Magna Group 273,000 8,804
Merchantile Bancorp 150,700 8,891
Signet Banking 260,900 8,577
Summit Bancorp 183,854 9,078
TIG Holdings 624,000 16,848
----------
Total Financials 141,588
----------
HEALTH CARE (6.2%)
American Home Products 345,600 26,352
Baxter International 490,800 25,890
C.R. Bard 525,400 16,813
Pharmacia Upjohn ADR 1,118,900 38,742
----------
Total Health Care 107,797
----------
TECHNOLOGY (1.5%)
Eastman Kodak 307,900 25,517
----------
TRANSPORTATION (2.2%)
KLM Royal Dutch Air* 664,000 19,505
Illinois Central 493,400 17,824
----------
Total Transportation 37,329
----------
UTILITIES (4.8%)
Central & South West 697,200 14,815
Duke Power 201,300 9,058
Pacificorp 873,000 17,351
Questar 445,900 17,502
Southern 1,124,800 23,902
----------
Total Utilities 82,628
----------
Total Common Stocks
(Cost $1,445,015) 1,599,432
----------
- -------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- -------------------------------------------------------------
REPURCHASE AGREEMENTS (6.8%)
Deutsche Bank
5.56%, dated 05/30/97,
matures 06/02/97,
repurchase price
$70,160,347
(collateralized by FHLMC
obligation, par value
$69,192,840, 6.63%,
05/15/08:FNMA obligation,
par value $54,184,000,
8.50%, 04/01/17: total
market value $71,530,412) $70,128 $70,128
Salomon Brothers
5.56%, dated 05/30/97,
matures 06/02/97, repurchase
price $46,073,839
(collateralized by various
FHLMC obligations,
total par value
$68,587,421, 6.00%-9.50%,
11/01/01-05/01/27: various
FNMA obligations total
par value $71,651,398,
5.50%-9.00%, 06/01/01-05/01/27:
total market value $44,159,361) 43,054 43,054
Swiss Bank
5.56%, dated 05/30/97,
matures 06/02/97,
repurchase price
$4,954,044
(collateralized by
FNMA obligation, par
value $6,319,000,
6.071%, matures
04/01/34: market
value $5,075,690) 4,952 4,952
----------
Total Repurchase Agreements
(Cost $118,134) 118,134
----------
Total Investments (99.4%)
(Cost $1,563,149) 1,717,566
----------
OTHER ASSETS AND LIABILITIES, NET (0.6%) 9,961
----------
43
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
VALUE INCOME STOCK FUND--CONCLUDED
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 108,557,380
outstanding shares of beneficial
interest $1,171,719
Fund shares of the Investor Shares
(unlimited authorization --
no par value) based on 12,133,042
outstanding shares of beneficial
interest 134,021
Fund shares of the Flex Shares
(unlimited authorization --
no par value) based on
5,399,733
outstanding shares of
beneficial interest 68,125
Undistributed net investment income 6,428
Accumulated net realized gain
on investments 192,817
Unrealized appreciation on investments 154,417
----------
Total Net Assets (100.0%) $1,727,527
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 13.71
==========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 13.68
==========
Maximum Offering Price Per Share --
Investor Class ($13.68 (Divide) 96.25%) $ 14.21
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 13.61
==========
(1) The Flex Shares have a contingent sales charge. For a description
of a possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
44
<PAGE>
MID-CAP EQUITY FUND
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
COMMON STOCKS (92.6%)
BASIC MATERIALS (5.0%)
IMC Fertilizer Group 168,800 $ 6,604
James River 94,300 3,312
Potash of Saskatchewan 71,800 5,897
----------
Total Basic Materials 15,813
----------
CAPITAL GOODS (15.1%)
Agco 111,400 3,551
Fisher Scientific International 86,500 3,136
Foster Wheeler 79,400 3,077
Hubbell, Cl B 84,540 3,847
Molten Metal Technology* 203,300 1,449
Philip Services* 405,600 5,932
Solectron* 119,100 7,444
Sundstrand 90,200 4,487
United Waste Systems* 136,200 5,227
U.S. Filter* 156,900 4,942
York International 100,850 4,891
----------
Total Capital Goods 47,983
----------
COMMUNICATIONS SERVICES (1.1%)
Nextel Communications, Cl A* 243,500 3,592
----------
CONSUMER CYCLICALS (15.5%)
Bed Bath and Beyond* 116,000 3,292
Dollar General 183,200 6,160
Harley-Davidson 158,900 7,111
International Speedway* 123,500 2,439
Men's Wearhouse* 123,600 4,125
Nine West Group* 113,000 4,350
Saks Holdings* 224,300 5,579
Stanley Works 87,700 3,596
Staples* 336,700 7,407
West Marine* 203,800 5,350
----------
Total Consumer Cyclicals 49,409
----------
CONSUMER STAPLES (12.0%)
Boston Chicken* 313,700 5,647
Cracker Barrel Old
Country Stores 182,700 5,298
Dial 186,500 3,124
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
CONSUMER STAPLES--CONTINUED
Hannaford Brothers 137,600 $ 4,799
JP Foodservice* 152,000 4,408
McKesson 75,300 5,657
Nabisco Holdings, Cl A 130,200 5,159
Papa John's International* 122,400 3,902
----------
Total Consumer Staples 37,994
----------
ENERGY (6.3%)
Anadarko Petroleum 105,400 6,640
Kerr-McGee 47,400 3,069
Tosco 91,600 2,988
Western Atlas* 106,300 7,215
----------
Total Energy 19,912
----------
FINANCIALS (9.9%)
Crestar Financial 139,000 5,282
First Security 162,075 3,971
Hartford Life, Cl A* 62,400 2,090
North Fork Bancorporation 88,000 1,848
Regions Financial 57,500 3,436
SouthTrust 77,100 2,997
Summit Bancorp 111,000 5,481
Union Planters 66,700 3,152
PMI Group 56,600 3,106
----------
Total Financials 31,363
----------
HEALTH CARE (9.9%)
Allergan 112,200 3,324
Biogen* 187,300 6,216
DePuy* 136,500 3,310
Medpartners* 179,700 3,414
Pacificare Health Systems, Cl B* 91,400 7,243
Teva Pharmaceuticals ADR 65,600 3,936
Watson Pharmaceuticals* 105,100 4,112
----------
Total Health Care 31,555
----------
TECHNOLOGY (15.0%)
ADC Telecommunications* 177,500 6,079
Adobe Systems 110,300 4,922
Analog Devices* 240,133 6,424
45
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
MID-CAP EQUITY FUND--CONCLUDED
- ---------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------
TECHNOLOGY--CONTINUED
Atmel* 151,900 $ 4,367
Ceridian* 141,000 5,182
Flextronics International* 207,000 4,890
Micron Electronics* 193,600 2,940
Network General* 226,600 4,164
Teradyne* 214,400 8,790
----------
Total Technology 47,758
----------
TRANSPORTATION (1.4%)
ASA Holdings 172,300 4,501
----------
UTILITIES (1.4%)
Wisconsin Energy 185,200 4,468
----------
Total Common Stocks
(Cost $268,513) 294,348
----------
REPURCHASE AGREEMENTS (6.8%)
Deutsche Bank
5.55%, dated 05/30/97,
matures 06/02/97, repurchase
price $12,270,617 (collateralized
by FNMA obligation, par value
$13,389,534, 0.000%,
01/01/26: market value
$12,510,245) $12,265 12,265
Merrill Lynch
5.55%, dated 05/30/97,
matures 06/02/97, repurchase
price $9,389,853 (collateralized
by FNMA obligation, par value
$465,000, 0.000%, 11/25/22;
and various GNMA obligations,
total par value $10,608,368,
6.000%-8.500%, 05/20/06-05/15/26:
total market value $9,577,430) 9,386 9,386
----------
Total Repurchase Agreements
(Cost $21,651) 21,651
----------
- -------------------------------------------------------------
VALUE (000)
- -------------------------------------------------------------
Total Investments (99.4%)
(Cost $290,164) $ 315,999
----------
OTHER ASSETS AND LIABILITIES, NET (0.6%) 1,736
----------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 21,752,271
outstanding shares of beneficial
interest 239,440
Fund shares of the Investor Shares
(unlimited authorization --
no par value) based on 1,537,279
outstanding shares of beneficial
interest 17,180
Fund shares of the Flex Shares
(unlimited authorization --
no par value) based on 776,273
outstanding shares of
beneficial interest 9,538
Accumulated net investment loss (10)
Accumulated net realized gain
on investments 25,752
Net unrealized appreciation
on investments 25,835
----------
Total Net Assets (100.0%) $ 317,735
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 13.21
==========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 13.17
==========
Maximum Offering Price Per Share --
Investor Shares ($13.17 (Divide) 96.25%) $ 13.68
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 13.04
==========
(1) The Flex Shares have a contingent sales charge. For a description
of a possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
46
<PAGE>
SMALL CAP EQUITY FUND
- -------------------------------------------------------------
SHARES VALUE (000)
- -------------------------------------------------------------
COMMON STOCKS (95.2%)
BASIC MATERIALS (3.1%)
Columbus Mckinnon 63,700 $ 1,147
Commonwealth Industries 94,700 1,788
Lilly Industries Incorporated, Cl A 9,000 189
Schnitzer Steel Industries, Cl A 38,800 970
----------
Total Basic Materials 4,094
----------
CAPITAL GOODS (11.7%)
A.M. Castle 87,600 1,905
Applied Industrial Technology 45,500 1,598
Barnes Group 13,300 357
Fisher Scientific International 69,000 2,501
Regal Beloit 115,700 3,081
Valmont Industries 24,100 1,012
Thomas Industries 34,000 956
Zurn Industries 145,900 3,866
----------
Total Capital Goods 15,276
----------
CONSUMER CYCLICALS (27.4%)
Ameron 6,600 366
Angelica 104,900 1,888
Brown Group 107,000 1,926
Bush Industries 116,300 2,617
Cross A.T., Cl A 54,800 610
Guilford Mills 132,250 2,595
Hardinge 38,000 988
Harman International 84,800 3,540
K2 55,500 1,603
Libbey 74,800 2,497
LSI Industries 72,300 1,103
Movado Group 86,625 1,917
Optical Coating Laboratories 43,900 466
Rock Tenn, Cl A 63,000 953
Sotheby's Holdings, Cl A 124,000 1,922
Springs Industries, Cl A 75,200 3,807
Talbots 143,700 3,772
WD-40 32,700 1,856
Wellman 73,100 1,307
Winnebago Industries 20,400 140
----------
Total Consumer Cyclicals 35,873
----------
- -------------------------------------------------------------
SHARES VALUE (000)
- -------------------------------------------------------------
CONSUMER STAPLES (15.4%)
ABM Industries 99,700 $ 1,932
Banta 87,000 2,414
Bowne & Company 106,000 3,167
Earthgrains 34,200 1,949
Ingles Markets, Cl A 136,000 1,964
John H. Harland 163,300 3,736
Kelly Services, Cl A 61,000 1,792
Rykoff-Sexton 52,100 996
Smucker (J.M.), Cl B 115,100 2,144
TCA Cable Television 3,000 101
----------
Total Consumer Staples 20,195
----------
ENERGY (5.6%)
Giant Industries 44,700 648
Monterey Resources 118,500 1,866
Pittston Minerals Group 73,400 1,009
Quaker State 255,400 3,863
----------
Total Energy 7,386
----------
FINANCIALS (10.1%)
Banco Latinamericano
de Exportaciones 46,600 2,196
Bank United, Cl A 28,700 997
GCR Holdings 7,800 209
Interwest Bancorp 26,700 935
IPC Holdings 79,300 2,022
Klamath First Bancorp 61,500 1,138
Lawyers Title 43,800 788
National Bancorp of Alaska 14,400 1,130
Seacoast Banking of Florida 49,000 1,286
West Coast Bancorp 40,625 1,016
Willis Corroon Public Limited 132,900 1,495
----------
Total Financials 13,212
----------
HEALTH CARE (8.9%)
Bindley Western Industries 75,600 1,663
Chemed 26,300 960
Invacare 117,000 2,516
Morrison Health Care 103,100 1,675
Vital Signs 101,000 2,007
47
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
SMALL CAP EQUITY FUND--CONCLUDED
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
HEALTH CARE--CONTINUED
West Company 96,100 $ 2,835
----------
Total Health Care 11,656
----------
TECHNOLOGY (3.0%)
Methode Electronics, Cl A 231,200 3,902
----------
TRANSPORTATION (4.3%)
Arnold Industries 107,300 1,797
Knightsbridge Tankers Limited* 50,000 1,231
Sea Containers 127,200 2,544
----------
Total Transportation 5,572
----------
UTILITIES (5.7%)
Eastern Enterprises 12,800 442
Enron Global Power &
Pipelines 12,800 422
Minnesota Power & Light 65,300 1,894
Northwest Natural Gas 39,050 952
TNP Enterprises 56,000 1,232
United Water Resources 74,100 1,334
Wicor 33,900 1,246
----------
Total Utilities 7,522
----------
Total Common Stocks
(Cost $117,054) 124,688
----------
PREFERRED STOCKS (1.9%)
PRECIOUS METALS (1.9%)
Coeur D'Alene Mines 151,100 2,512
----------
Total Preferred Stocks
(Cost $2,502) 2,512
----------
- -------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- -------------------------------------------------------------
REPURCHASE AGREEMENT (3.7%)
Deutsche Bank 5.56%, dated 05/30/97,
matures 06/02/97, repurchase
price $4,900,504 (collateralized
by FHLMC obligation, total par
value $5,062,244,
6.092%, 10/01/32,
market value: $4,996,199) $4,898 $ 4,898
----------
Total Repurchase Agreements
(Cost $4,898) 4,898
----------
Total Investments (100.8%)
(Cost $124,454) 132,098
----------
OTHER ASSETS AND LIABILITIES, NET (-0.8%) (1,049)
----------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 11,836,719
outstanding shares of beneficial
interest 121,332
Undistributed net investment income 316
Accumulated net realized gain
on investments 1,757
Net unrealized appreciation
on investments 7,644
----------
Total Net Assets (100.0%) $ 131,049
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 11.07
==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
48
<PAGE>
================================================================================
CAPITAL GROWTH FUND
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
COMMON STOCKS (86.6%)
BASIC MATERIALS (4.7%)
Aluminum Company of America 117,500 $ 8,651
Air Products & Chemicals 27,100 2,107
Fort Howard* 179,000 8,223
Hercules 228,800 10,725
Monsanto 265,100 11,664
Morton International 198,000 6,386
Potash of Saskatchewan 54,100 4,443
Praxair 123,900 6,520
W.R. Grace 67,500 3,527
----------
Total Basic Materials 62,246
----------
CAPITAL GOODS (13.9%)
Allied Signal 361,100 27,714
Avery Dennison 62,300 2,344
Deere 163,000 8,333
Emerson Electric 285,000 15,390
Fluor 57,500 3,040
General Electric 688,700 41,580
General Signal 311,700 13,130
Keystone International 54,400 1,775
Lockheed Martin 96,000 8,988
McDonnell Douglas 58,200 3,747
Molten Metal Technology* 243,500 1,735
Pall 140,000 3,308
Rockwell International 171,400 11,055
Thomas & Betts 34,064 1,733
Tyco International 359,100 22,803
United Technologies 164,400 13,214
United Waste Systems* 8,700 334
USA Waste Services* 112,900 4,093
Waste Management 21,000 667
Wheelabrator Technologies 135,900 1,750
----------
Total Capital Goods 186,733
----------
COMMUNICATION SERVICES (1.6%)
Airtouch Communications* 12,700 354
BellSouth 71,700 3,253
Ericsson Telephone ADR* 263,800 9,398
GTE 196,000 8,649
----------
Total Communication Services 21,654
----------
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
CONSUMER CYCLICALS (8.4%)
American Stores 157,900 $ 7,184
Borders Group* 6,700 146
Carnival 282,300 10,727
Costco* 211,100 7,125
CUC International* 291,700 6,709
Federated Department Stores* 309,400 11,448
Ford Motor 82,100 3,079
Fruit of the Loom* 90,400 3,153
Gannett 44,500 4,116
Hollinger International 64,200 714
Home Depot 244,432 15,399
Intimate Brands 190,900 4,081
ITT* 33,400 1,991
Lear* 332,100 12,703
Marriott 27,100 1,565
Mattel 348,500 10,411
McGraw-Hill 35,900 1,961
Office Depot* 407,400 7,028
TJX 9,800 470
Tribune 46,900 2,028
----------
Total Consumer Cyclicals 112,038
----------
CONSUMER STAPLES (11.7%)
American Standard* 27,700 1,388
Avon Products 276,600 17,633
Colgate-Palmolive 24,400 1,513
CPC International 37,800 3,251
CVS 360,600 17,264
Dial 28,300 474
Gillette 171,817 15,270
Kimberly Clark 101,400 5,083
JP Foodservice* 132,900 3,854
Nabisco Holdings, Cl A 30,700 1,216
PepsiCo 12,400 456
Philip Morris 574,650 25,285
Ralston Purina Group 61,500 5,243
RJR Nabisco 105,600 3,419
Safeway* 259,300 11,669
Sara Lee 138,700 5,669
Sysco 335,700 11,708
Tele-Communications, Cl A* 375,800 5,684
49
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
CAPITAL GROWTH FUND--CONTINUED
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
CONSUMER STAPLES--CONTINUED
Time Warner 57,500 $ 2,674
Unilever ADR 12,400 2,403
Viacom, Cl B* 321,021 9,530
Walt Disney 55,366 4,533
Wendy's International 53,200 1,244
William Wrigley Jr. 11,300 670
----------
Total Consumer Staples 157,133
----------
ENERGY (5.7%)
Amoco 66,500 5,943
British Petroleum ADR 53,500 7,751
Dresser Industries 186,200 6,377
Halliburton 142,100 10,995
Kerr-McGee 49,200 3,186
Mobil 138,200 19,331
Royal Dutch Petroleum, ADR 26,800 5,233
Schlumberger 40,700 4,848
Tosco 88,100 2,874
Union Pacific Resources Group 330,358 9,539
----------
Total Energy 76,077
----------
FINANCIALS (12.9%)
American International Group 76,350 10,336
BankAmerica 126,300 14,761
Bank of New York 82,600 3,521
Capital One Financial 36,400 1,169
Chase Manhattan Bank 314,200 29,692
Citicorp 10,100 1,155
Conseco 19,100 764
Cullen/Frost Bankers 23,900 941
Dean Witter Discover 50,800 2,096
FHLMC 221,100 7,296
FNMA 206,100 8,991
First Union 59,300 5,092
First USA 267,800 13,256
GCR Holdings 60,000 1,605
General Re 53,500 9,376
Great Western Financial 191,900 9,307
Hartford Financial Services Group 266,800 20,810
Nationsbank 45,040 2,643
Norwest 24,400 1,305
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
FINANCIALS--CONTINUED
PMI Group 104,100 $ 5,713
Sphere Drake Holdings 214,900 1,907
Summit Bancorp 43,900 2,168
Travelers 160,296 8,796
Washington National 354,600 9,929
Wells Fargo 2,500 659
----------
Total Financials 173,288
----------
HEALTH CARE (13.6%)
Alza, Cl A* 7,900 233
American Home Products 427,000 32,559
Amgen* 71,200 4,762
Baxter International 173,100 9,131
Becton Dickinson 19,300 951
Boston Scientific* 83,111 4,436
Bristol-Myers Squibb 276,800 20,310
Columbia/HCA Healthcare 493,196 18,063
Eli Lilly 107,400 9,988
Healthsouth* 467,000 10,683
Horizon/CMS Healthcare* 50,000 913
Johnson & Johnson 386,888 23,165
Medpartners* 413,600 7,858
Medtronic 22,400 1,658
Merck 196,082 17,623
Pacificare Health Systems, Cl B* 39,200 3,107
Schering Plough 89,400 8,113
Tenet Healthcare* 222,800 6,127
Warner Lambert 30,900 3,113
----------
Total Health Care 182,793
----------
TECHNOLOGY (12.7%)
Atmel* 50,900 1,463
Automatic Data Processing 44,500 2,186
Cadence Design Systems* 28,000 931
Ceridian* 119,000 4,373
Cisco Systems* 243,600 16,504
Compaq Computer* 13,800 1,494
Eastman Kodak 137,200 11,370
First Data 390,100 15,604
Hewlett Packard 112,600 5,799
IBM 115,600 9,999
50
<PAGE>
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
TECHNOLOGY--CONTINUED
Intel 154,900 $ 23,467
Lucent Technologies 136,131 8,661
Microsoft* 185,100 22,952
Motorola 163,300 10,839
Oracle* 165,450 7,714
Scientific-Atlanta 644,900 11,689
Xerox 231,600 15,691
----------
Total Technology 170,736
----------
TRANSPORTATION (1.0%)
Burlington Northern Santa Fe 102,800 8,532
Delta Air Lines 21,000 1,969
Union Pacific 39,500 2,676
----------
Total Transportation 13,177
----------
UTILITIES (0.4%)
Consolidated Natural Gas 23,700 1,259
Enron 64,000 2,608
Sonat 27,100 1,558
----------
Total Utilities 5,425
----------
Total Common Stocks
(Cost $982,524) 1,161,300
----------
PREFERRED STOCKS (1.7%)
BASIC MATERIALS (0.2%)
International Paper,
CV to .9259 Shares 45,000 2,278
----------
FINANCIALS (0.1%)
National Bank of Australia,
CV to .3273 Shares* 74,600 2,014
----------
TECHNOLOGY (1.2%)
Microsoft, CV to 1 share 186,700 16,080
----------
TRANSPORTATION (0.2%)
Continental Air Finance Trust,
CV to 2.0678 Shares* 28,500 2,230
----------
Total Preferred Stocks
(Cost $20,294) 22,602
----------
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
CONVERTIBLE BONDS (5.0%)
Alza, CV to 12.987 Shares (A)
0.000%, 07/14/14 $11,500 $ 5,103
Automatic Commercial Exchange
Security, CV to 0.8333 Shares
6.500%, 05/15/00 123 2,958
Continental Airlines,
CV to 16.559 Shares
6.750%, 04/15/06 3,600 4,707
Cuc International,
CV to 32.6531
3.000%, 02/15/02 7,000 6,913
Home Depot,
CV to 14.4665 Shares
3.250%, 10/01/01 9,000 9,630
Mariott LYON, (A) (B)
0.000%, 03/25/11 5,000 2,906
Molten Metal Technology,
CV to 25.8065 Shares (B)
5.750%, 05/01/06 5,500 2,365
Roche, CV to 3.5626 Shares (A)
0.000%, 05/06/12 19,000 7,648
Times Mirror, CV to 5.8280
Shares (A) (B)
0.000%, 04/15/17 10,000 3,925
U.S. Filter, CV to 25.3164 Shares,
Callable 12/15/99 @ 101.8
4.500%, 12/15/01 5,200 5,298
USA Waste Services,
CV to 35.3243 Shares
5.000%, 03/01/06 2,350 3,243
USA Waste Services,
CV to 22.9594 Shares, Callable
02/01/2000 @101.6
4.000%, 02/01/02 3,000 3,116
WMX Technologies,
CV to 26.078 Shares
2.000%, 01/24/05 9,500 8,752
----------
Total Convertible Bonds
(Cost $66,837) 66,564
----------
51
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
CAPITAL GROWTH FUND--CONCLUDED
- --------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- --------------------------------------------------------------
REPURCHASE AGREEMENTS (8.2%)
Deutsche Bank
5.56%, dated 05/30/97,
matures 06/02/97, repurchase
price $76,351,152 (collateralized
by various FHLMC obligations,
total par value $41,261,658,
6.092%-6.230%, 12/15/23-10/01/32;
and various FNMA obligations,
total par value $40,818,728,
0.000%, 01/01/26-04/25/27:
total market value $77,842,108) $76,316 $ 76,316
Salomon Brothers
5.56%, dated 05/30/97, matures
06/02/97, repurchase price
$33,282,808 (collateralized
by various FHLMC obligations,
total par value $25,236,419,
5.500%-9.000%, 01/01/00-06/01/26;
and various FNMA obligations,
total par value $37,520,630,
5.500%-9.500%, 04/01/01-04/01/27:
total market value $34,062,576) 33,267 33,267
----------
Total Repurchase Agreements
(Cost $109,583) 109,583
----------
Total Investments (101.5%)
(Cost $1,179,238) 1,360,049
----------
OTHER ASSETS AND LIABILITIES, NET (-1.5%) (19,508)
----------
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization -- no
par value) based on 71,924,416
outstanding shares of
beneficial interest $ 807,086
Fund shares of the Investor Shares
(unlimited authorization -- no
par value) based on 14,515,982
outstanding shares of
beneficial interest 167,543
Fund shares of the Flex Shares
(unlimited authorization -- no
par value) based on 2,456,856
outstanding shares of
beneficial interest 34,522
Undistributed net investment income 3,569
Accumulated net realized gain
on investments 147,010
Net unrealized appreciation
on investments 180,811
----------
Total Net Assets (100.0%) $1,340,541
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $15.09
==========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $15.06
==========
Maximum Offering Price Per Share --
Investor Class ($15.06 (Divide) 96.25%) $15.65
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $14.96
==========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
52
<PAGE>
BALANCED FUND
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
COMMON STOCKS (51.7%)
BASIC MATERIALS (2.7%)
Air Products & Chemicals 1,900 $ 148
Aluminum Company of America 7,800 574
Fort Howard* 12,000 551
Hercules 15,500 727
Monsanto 19,400 854
Morton International 13,900 448
Potash of Saskatchewan 3,600 296
Praxair 8,300 437
W.R. Grace 7,300 381
----------
Total Basic Materials 4,416
----------
CAPITAL GOODS (8.6%)
Allied Signal 27,800 2,134
Avery Dennison 8,200 309
Deere 11,600 593
Emerson Electric 20,500 1,107
Fisher Scientific International 5,000 181
Fluor 4,000 211
General Electric 50,100 3,025
General Signal 20,600 868
Keystone International 11,800 385
Lockheed Martin 7,000 655
McDonnell Douglas 6,600 425
Molten Metal Technology* 19,100 136
Pall 9,500 224
Rockwell International 12,500 806
Thomas & Betts 2,300 117
Tyco International 26,100 1,657
United Technologies 11,900 956
United Waste Systems* 400 15
USA Waste Services* 7,100 257
Waste Management 1,500 48
----------
Total Capital Goods 14,109
----------
COMMUNICATION SERVICES (1.2%)
Airtouch Communications* 8,600 240
BellSouth 8,100 368
Ericsson Telephone ADR* 19,200 684
GTE 15,900 702
----------
Total Communication Services 1,994
----------
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
CONSUMER CYCLICALS (4.7%)
American Standard* 2,000 $ 100
Carnival 20,600 783
Costco* 14,200 479
CUC International* 21,200 488
Federated Department Stores* 21,000 777
Ford Motor 5,600 210
Fruit of the Loom* 8,600 300
Gannett 3,000 277
Home Depot 19,200 1,210
Intimate Brands 12,900 276
ITT* 2,400 143
Lear* 22,700 868
Marriott 1,700 98
Mattel 21,950 656
McGraw-Hill 2,900 158
Office Depot* 25,800 445
Tribune 10,000 432
----------
Total Consumer Cyclicals 7,700
----------
CONSUMER STAPLES (7.2%)
American Stores 10,700 487
Avon Products 19,800 1,262
Colgate-Palmolive 1,600 99
CPC International 2,600 224
CVS 25,700 1,230
Dial 1,900 32
Gillette 12,548 1,115
JP Foodservice* 11,900 345
Kimberly Clark 9,000 451
Nabisco Holdings, Cl A 1,200 48
PepsiCo 900 33
Philip Morris 41,800 1,839
Ralston Purina Group 4,500 384
RJR Nabisco 7,800 253
Safeway* 21,200 954
Sara Lee 9,400 384
Sysco 24,500 854
Tele-Communications, Cl A* 27,100 410
Time Warner 4,200 195
Unilever ADR 900 174
Viacom, Cl B* 20,944 622
53
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
BALANCED FUND--CONTINUED
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
CONSUMER STAPLES--CONTINUED
Walt Disney 3,395 $ 278
Wendy's International 6,900 161
----------
Total Consumer Staples 11,834
----------
ENERGY (3.4%)
Amoco 4,800 429
British Petroleum ADR 3,900 565
Dresser Industries 13,300 456
Halliburton 11,300 874
Kerr-McGee 7,100 460
Mobil 8,900 1,245
Royal Dutch Petroleum ADR 1,900 371
Schlumberger 2,800 334
Tosco 5,900 192
Union Pacific Resources Group 21,922 633
----------
Total Energy 5,559
----------
FINANCIALS (7.8%)
American International Group 5,200 704
Bank of New York 5,600 239
BankAmerica 9,100 1,064
BB&T 8,600 344
Capital One Financial 2,600 84
Chase Manhattan Bank 23,400 2,211
Citicorp 700 80
Conseco 1,400 56
Cullen/Frost Bankers 1,900 75
Dean Witter Discover 3,700 153
FHLMC 16,200 535
FNMA 13,400 585
First Union 4,300 369
First USA 18,700 926
GCR Holdings 7,000 187
General Re 3,600 631
Great Western Financial 13,900 674
Hartford Financial Services Group 19,500 1,521
Norwest 5,500 294
PMI Group 7,600 417
Sphere Drake Holdings 21,000 186
Summit Bancorp 3,000 148
Travelers 11,133 611
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
FINANCIALS--CONTINUED
U.S. Bancorp 700 $ 43
Washington National 19,500 546
----------
Total Financials 12,683
----------
HEALTH CARE (7.9%)
American Home Products 28,400 2,165
Amgen* 6,500 435
Baxter International 12,600 665
Becton Dickinson 1,300 64
Boston Scientific* 5,910 315
Bristol-Myers Squibb 20,300 1,490
Columbia/HCA Healthcare 33,310 1,220
Healthsouth* 32,868 752
Johnson & Johnson 28,100 1,682
Eli Lilly 7,800 725
Medpartners* 27,600 524
Medtronic 1,600 118
Merck 14,200 1,276
Pacificare Health Systems, Cl B* 3,400 269
Schering Plough 6,600 599
Tenet Healthcare* 15,000 412
Warner Lambert 2,300 232
----------
Total Health Care 12,943
----------
TECHNOLOGY (7.4%)
Atmel* 3,600 103
Automatic Data Processing 2,270 112
Cadence Design Systems* 9,000 299
Ceridian* 6,300 232
Cisco Systems* 16,400 1,111
Compaq Computer* 600 65
Eastman Kodak 10,000 829
First Data 28,000 1,120
Hewlett Packard 7,900 407
IBM 7,800 675
Intel 11,500 1,742
Lucent Technologies 9,214 586
Microsoft* 12,200 1,513
Motorola 11,000 730
Oracle* 10,900 508
Scientific-Atlanta 42,300 767
54
<PAGE>
================================================================================
- ------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
- ------------------------------------------------------------
TECHNOLOGY--CONTINUED
Xerox 18,200 $ 1,233
----------
Total Technology 12,032
----------
TRANSPORTATION (0.6%)
Burlington Northern Santa Fe 7,400 614
Delta Air Lines 1,400 131
Union Pacific 2,800 190
----------
Total Transportation 935
----------
UTILITIES (0.2%)
Consolidated Natural Gas 1,500 80
Enron 4,200 171
Sonat 1,800 103
----------
Total Utilities 354
----------
Total Common Stocks
(Cost $72,954) 84,559
----------
PREFERRED STOCKS (1.1%)
AIR TRANSPORTATION (0.2%)
Continental Airline Financial (B) 5,000 391
----------
BANKS (0.2%)
National Bank of Australia,
CV to 0.3273 shares* 10,000 270
----------
TECHNOLOGY (0.7%)
Microsoft, CV to 1 share 12,500 1,077
----------
Total Preferred Stocks
(Cost $1,573) 1,738
----------
CORPORATE OBLIGATIONS (23.1%)
American General Finance
6.875%, 07/01/99 $ 1,000 1,007
Aristar
6.750%, 05/15/99 1,500 1,507
Associates of North America, MTN
6.650%, 08/30/99 750 752
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
CORPORATE OBLIGATIONS--CONTINUED
AT&T Capital, MTN
6.920%, 04/29/99 $2,250 $ 2,261
Bear Stearns
7.000%, 03/01/07 1,900 1,853
Ford Capital
9.500%, 06/01/10 1,350 1,558
General Electric Capital
6.660%, 05/01/18 1,000 1,003
General Motors Acceptance
7.125%, 05/01/01 1,900 1,914
6.750%, 11/04/04 1,500 1,459
Homeside Lending, MTN
6.875%, 05/15/00 2,000 1,998
Household Finance, MTN
7.150%, 06/15/00 1,000 1,010
International Lease Finance
6.700%, 04/30/99 1,900 1,910
Lockheed Martin
6.550%, 05/15/99 1,000 1,001
Marriott International, (A) (B)
0.000%, 03/25/11 1,000 581
Mascotech, Callable 12/22/96 @ 103
4.500%, 12/15/03 500 445
Merrill Lynch, MTN
6.640%, 04/09/99 1,500 1,506
Morgan Stanley Group
6.875%, 03/01/07 1,000 974
Philip Morris
7.250%, 09/15/01 2,100 2,108
6.800%, 12/01/03 500 488
7.500%, 04/01/04 1,000 1,005
RHG Finance
8.875%, 10/01/05 1,500 1,622
Salomon
6.500%, 03/01/00 2,500 2,478
6.750%, 02/15/03 1,150 1,118
Service International
7.375%, 04/15/04 1,750 1,772
SunAmerica
6.200%, 10/31/99 2,000 1,985
US West Capital Funding
7.300%, 01/15/07 2,500 2,484
----------
55
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
BALANCED FUND--CONCLUDED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
Total Corporate Obligations
(Cost $37,869) $ 37,799
----------
CONVERTIBLE BONDS (2.5%)
Alza, CV to 26.1840 Shares,
Callable 05/01/00 @ 100
5.000%, 05/01/06 $ 500 501
Automatic Commercial Exchange
Security, CV to 0.8333 shares
6.500%, 05/15/00 9 215
Roche, CV to 3.5626 Shares (A)
0.000%, 05/06/12 1,000 403
Staples, CV to 30.303 Shares (B)
4.500%, 10/01/00 500 585
Time Warner Finance,
CV to 7.7589 Shares (A)
0.000%, 06/22/13 900 411
U.S. Filter, CV to 25.3164 shares,
Callable 12/15/99 @ 101.8
4.500%, 12/15/01 500 509
USA Waste Services,
CV to 35.3243 Shares
5.000%, 03/01/06 355 490
WMX Technologies,
CV to 26.078 shares
2.000%, 01/24/05 1,000 921
----------
Total Convertible Bonds
(Cost $3,864) 4,035
----------
U.S. AGENCY MORTGAGE-BACKED
OBLIGATIONS (1.2%)
FHLMC
8.000%, 06/01/02 574 589
7.500%, 09/01/03 1,308 1,326
----------
Total U.S. Agency Mortgage-
Backed Obligations
(Cost $1,916) 1,915
----------
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (10.6%)
U.S. Treasury Bonds
7.500%, 11/15/16 $ 3,000 $ 3,163
8.125%, 08/15/19 7,800 8,775
6.625%, 02/15/27 3,450 3,324
U.S. Treasury Notes
6.750%, 04/30/00 2,000 2,020
----------
Total U.S. Treasury Obligations
(Cost $17,245) 17,282
----------
REPURCHASE AGREEMENT (8.9%)
Merrill Lynch 5.55%, dated 05/30/97,
matures 06/02/97, repurchase
price $14,570,241 (collateralized
by various GNMA obligations,
total par value $26,629,425,
7.000%-13.250%, 04/20/00-11/20/22:
total market value $14,856,427) 14,563 14,563
----------
Total Repurchase Agreement
(Cost $14,563) 14,563
----------
Total Investments (99.1%)
(Cost $149,984) 161,891
----------
OTHER ASSETS AND LIABILITIES, NET (0.9%) 1,546
----------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 12,674,232
outstanding shares of beneficial
interest 131,876
Fund shares of the Investor Shares
(unlimited authorization --
no par value) based on 501,289
outstanding shares of beneficial
interest 5,143
56
<PAGE>
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
NET ASSETS--CONTINUED
Fund shares of the Flex Shares
(unlimited authorization --
no par value) based on 509,658
outstanding shares of
beneficial interest $ 5,720
Undistributed net investment income 781
Accumulated net realized gain
on investments 8,010
Net unrealized appreciation
on investments 11,907
----------
Total Net Assets (100.0%) $ 163,437
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 11.94
==========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 11.99
==========
Maximum Offering Price Per Share --
Investor Class ($11.99 (Divide) 96.25%) $ 12.46
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1)(2) $ 11.90
==========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
(2) Represents NAV on last business day -- May 30, 1997.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
57
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
EMERGING MARKETS EQUITY FUND
- ------------------------------------------------------------
SHARES VALUE (000)
- -------------------------------------------------------------
FOREIGN COMMON STOCKS (84.7%)
ARGENTINA (6.9%)
Banco Frances del Rio de la
Plata ADR* 16,000 $ 526
Capex, Cl A 33,700 324
Massalin Particulares, Cl B 38,800 231
Metrogas ADR 32,204 314
Quilmes Industrial 37,000 430
Transportadora de Gas del
Sur ADR 33,000 417
YPF ADR, Cl D 16,000 480
----------
Total Argentina 2,722
----------
BRAZIL (4.3%)
Makro Atacadista GDR 27,500 344
Souza Cruz 50,000 467
Telebras ADR 3,230 444
Votorantim Celelose Papel
Receibos* 1,476,876 40
Unibanco 12,000 414
----------
Total Brazil 1,709
----------
CHILE (1.1%)
Administradora de Fondos de
Pensiones Provida ADR 21,500 441
----------
COLOMBIA (1.6%)
Banco de Colombia GDS 24,700 152
Banco Ganadero ADR 15,600 476
----------
Total Colombia 628
----------
CZECH REPUBLIC (0.5%)
Komercni Banka GDR 8,400 204
----------
ECUADOR (0.4%)
La Cemento Nacional GDR 800 158
----------
GREECE (5.3%)
Greek Telecom 7,800 194
Hellas Can Packaging 25,500 467
Papastratos Cigarettes 15,400 316
Teletypos 130,000 533
Titan Cement Company 5,700 568
----------
Total Greece 2,078
----------
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
HONG KONG (9.2%)
China Hong Kong Photo 1,086,000 $ 315
Esprit Asia Holdings 616,000 354
First Pacific 142,000 181
National Mutual Asia 358,000 390
Peregrine Investment Holdings 137,000 244
Peregrine Investment Warrants* 6,600 2
Road King Infrastructure* 400,000 390
Seoul Horizon Trust 17,000 212
Shenzhen Express* 700,000 235
Sinocan 920,000 365
South China Morning Post
Holdings 460,000 442
Wing Hang Bank 108,000 514
----------
Total Hong Kong 3,644
----------
HUNGARY (1.4%)
Egis* 6,000 353
Gedeon Richter GDR 2,500 207
----------
Total Hungary 560
----------
INDIA (4.5%)
Hindalco GDR 6,700 221
India Cements GDR 54,000 124
Indian Aluminum GDR 15,800 58
Indian Aluminum GDS 15,300 57
Tata Electric GDR 210 71
Videsh Sanchar Nigam GDR 60,000 1,236
----------
Total India 1,767
----------
INDONESIA (8.8%)
Budi Acid Jaya, F 185,000 228
Citra Marga Nusaphala 472,000 471
Dankos Laboratories, F 665,000 561
Indonesian Satellite ADR 13,500 403
Matahari Putra Prima 251,000 447
Modern Photo Film, F 150,000 546
Tambang Timah, F 281,000 451
Tempo Scan Pacific 164,000 351
----------
Total Indonesia 3,458
----------
58
<PAGE>
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
ISRAEL (5.8%)
Blue Square Stores* 57,300 $ 587
ECI Telecommunications 22,000 509
Koor Industries ADR 20,300 355
Nice Systems ADR* 18,000 549
Orbotech* 10,000 279
----------
Total Israel 2,279
----------
MALAYSIA (3.4%)
Aluminium of Malaysia 231,000 325
Edaran Otomobil 28,000 244
Petronas Dagangan 170,000 403
Southern Bank Warrants* 15,000 10
UMW Holdings 72,000 370
----------
Total Malaysia 1,352
----------
MEXICO (8.3%)
Femsa, Cl B 106,000 562
Grupo Carso 66,000 375
Grupo Continental 167,750 418
Grupo Elektra GDR 21,100 401
Herdez, Cl B 1,035,000 458
Kimberly Clark, Cl A 95,500 331
Nacional de Drogas, Cl L 139,000 459
Telefonos de Mexico ADR 6,500 288
----------
Total Mexico 3,292
----------
PANAMA (1.1%)
Banco Latinamericano de
Exportaciones 9,000 424
----------
PERU (2.1%)
Cerveceria Backus & Johnston 356,240 320
CPT Telefoncia del Peru 15,000 381
Telefonica del Peru, Cl B 50,500 125
----------
Total Peru 826
----------
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
PHILIPPINES (3.6%)
Bacnotan Consolidated 135,600 $ 250
Benpres GDR* 65,800 467
First Philippine Holdings 174,375 288
Philippine Long Distance 14,000 414
----------
Total Philippines 1,419
----------
PORTUGAL (2.5%)
Banco Totta & Acores 21,700 309
Cimentos de Portugal 15,020 330
Portugal Telecom 600 23
Portugal Telecom ADR 8,200 316
----------
Total Portugal 978
----------
SINGAPORE (2.0%)
Amtek Engineering 180,000 311
Elec & Eltek International 84,000 496
----------
Total Singapore 807
----------
SOUTH AFRICA (8.6%)
Amalgated Banks of South Africa 39,642 245
Anglo American Coal 3,260 216
Barlow 37,700 399
De Beers Consolidated Mines ADR 5,500 194
Gencor 44,000 193
Kersaf Investments 48,600 381
Liberty Life Association of Africa 14,000 392
Rembrandt Group 30,400 306
Richemont 26,500 360
Sasol 26,200 321
Suncrush 181,000 387
----------
Total South Africa 3,394
----------
SOUTH KOREA (1.5%)
Pohang Iron & Steel ADR 21,000 609
----------
THAILAND (1.7%)
K.R. Precision, F 46,500 324
Nation Publishing 120,000 344
----------
Total Thailand 668
----------
59
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
EMERGING MARKETS EQUITY FUND--CONCLUDED
- ------------------------------------------------------------
SHARES/FACE
AMOUNT(G) (000) VALUE (000)
- ------------------------------------------------------------
TURKEY (0.1%)
Dogan Holding* 2,800,000 $ 60
----------
Total Foreign Common Stocks
(Cost $31,409) 33,477
----------
FOREIGN PREFERRED STOCKS (6.2%)
BRAZIL (6.2%)
Banco Bradesco 42,150,000 336
Banco Itau SA 800,000 411
Brahma 440,000 319
Cemig 2,800,000 128
Centrais Eletricas de Santa
Catarina, Cl B 103,000 124
Globex Utilidades 15,500 235
Lojas Renner 7,800,000 452
Multibras Eletrodomes* 228,400 233
Votorantim Celulose Papel* 7,500,000 203
----------
Total Foreign Preferred Stocks
(Cost $2,386) 2,441
----------
FOREIGN CONVERTIBLE BOND (0.4%)
TURKEY (0.4%)
Medya Holdings Int'l
10.000%, 06/28/01 200 160
----------
Total Foreign Convertible Bond
(Cost $175) 160
----------
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
TIME DEPOSIT (7.6%)
Cayman Island
5.250%, 06/02/97 $3,000 $ 3,000
----------
Total Time Deposit
(Cost $3,000) 3,000
----------
Total Investments (98.9%)
(Cost $36,970) 39,078
----------
OTHER ASSETS AND LIABILITIES, NET (1.1%) 417
----------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization -- no
par value) based on 3,660,064
outstanding shares of
beneficial interest 37,181
Undistributed net
investment income 144
Accumulated net realized gain
on investments and foreign
currency transactions 62
Net unrealized appreciation
on investments 2,108
----------
Total Net Assets (100.0%) $ 39,495
==========
Net Asset Value, Offering and Redemption
Price Per Share-- Trust Shares $ 10.79
==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
60
<PAGE>
================================================================================
INTERNATIONAL EQUITY INDEX FUND
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
U.S. AND FOREIGN COMMON STOCKS (95.4%)
AUSTRALIA (2.7%)
Amcor 13,361 $ 88
Broken Hill Proprietary 20,656 297
Coles Myer 30,235 141
CRA 5,542 91
CSR 27,994 103
Lend Lease 4,481 89
Mount Isa Mines Holdings 42,910 64
National Australia Bank 13,886 199
Newscorp 33,881 150
Pacific Dunlop 28,455 79
Western Mining 20,202 131
Westpac Banking 36,880 200
----------
Total Australia 1,632
----------
AUSTRIA (1.6%)
Bank of Austria 3,058 197
Creditanstalt Bankverein 3,535 209
Ea - Generali 343 85
Oest El Wirtsch, Cl A 2,245 161
OMV 1,715 218
Wienerberger Baustoff 401 82
----------
Total Austria 952
----------
BELGIUM (2.1%)
Bekaert 30 18
Delhaize Freres 1,000 50
Electrabel 1,000 224
Fortis 1,000 194
Generale Banque 470 186
Groupe Bruxelles Lambert 700 112
Kredietbank 290 119
Petrofina 500 176
Royale Belge 175 50
Solvay, Cl A 125 75
Union Minere* 680 55
----------
Total Belgium 1,259
----------
DENMARK (1.6%)
Carlsberg, Cl B 1,427 84
D/S 1912, Cl B 6 209
D/S Svendborg, Cl B 4 200
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
DENMARK--CONTINUED
Danisco 2,210 $ 131
Novo Nordisk, Cl B 1,670 179
Sophus Berendsen, Cl B 251 38
Tele Danmark, Cl B 2,208 109
----------
Total Denmark 950
----------
FINLAND (0.8%)
Merita* 25,000 85
Nokia, Cl K 2,300 150
Outokumpu Oy Akt, Cl A 3,100 61
Rauma 303 7
UPM - Kymmene 8,500 195
----------
Total Finland 498
----------
FRANCE (11.4%)
Accor 847 117
Air Liquide 1,886 289
Alcatel Alsthom 2,238 242
Axa 4,748 284
Banque National Paris, Cl A 3,350 137
Bouygues 950 82
Carrefour 603 396
Cie Bancaire 710 78
Cie de Saint Gobain 2,265 312
Cie Financiara Paribas 958 62
Cie Generale des Eaux 2,045 251
Cie Generale des Eaux Warrants* 2,045 1
Compagnie de Suez 2,963 151
Elf Aquitaine 4,282 428
Elf Sanofi 2,573 223
Eridania Beghin - Say 1,209 169
Groupe Danone 1,764 265
Havas 1,300 87
L'Oreal 1,084 393
Lafarge Coppee 2,218 142
Legrand 950 153
Louis Vuitton - Moet Hennessy 1,881 455
Lyonnaise des Eaux Dumez 1,650 162
Michelin, Cl B 2,844 155
Pernod - Ricard 2,179 104
Peugeot 1,790 177
Pinault - Printemps Redoute 400 168
61
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
INTERNATIONAL EQUITY INDEX FUND--CONTINUED
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
FRANCE--CONTINUED
Promodes 478 $ 162
Rhone - Poulenc, Cl A 8,500 275
Schneider 3,877 186
Societe Generale 2,280 253
Total Compaigne, Cl B 4,470 408
Unibail 400 39
----------
Total France 6,806
----------
GERMANY (19.2%)
Aachener & Munchener Bete 166 154
Allianz 5,080 1,085
BASF 15,100 561
Bayer 21,960 857
Bayerische Hypotheken und
Wechselbank 9,900 316
Bayerische Vereinsbank 2,360 98
Biersdorf 3,340 179
Colonia Konzern 310 31
Daimler - Benz 13,630 1,053
Degussa 2,490 121
Deutsche Bank 14,620 811
Dresdner Bank Frankfurt 10,600 372
Heidelberger Zement 2,490 235
Hochtief 260 11
Karstadt 625 219
Linde 391 271
Lufthansa 14,580 232
Man Muenchen 31 9
Mannesmann 853 349
Metro AG 3,063 333
Munchener Ruckvers 256 656
Preussag 11 3
RWE 6,340 273
SAP 1,900 339
Schering 1,810 182
Siemens 14,340 811
Thyssen 1,301 294
Veba 12,660 720
Viag 683 310
Volkswagen 961 624
----------
Total Germany 11,509
----------
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
HONG KONG (1.9%)
Cathay Pacific Airways 9,000 $ 14
Cheung Kong Holdings 13,000 133
China Light & Power 15,000 75
Hang Seng Bank 10,200 122
Hong Kong Telecommunications 50,000 111
HSBC Holdings 13,068 396
Hutchison Whampoa 14,800 123
Sun Hung Kai Properties 6,600 81
Swire Pacific, Cl A 9,000 75
----------
Total Hong Kong 1,130
----------
ITALY (9.0%)
Assicurazioni Generali 42,670 731
Banca Commerciale Italiana 33,500 66
Benetton Group 9,448 132
Credito Italiano 23,000 34
Edison 42,500 201
ENI 76,000 379
Fiat 139,000 456
Fiat Non-Convertible 42,000 74
Istituto Bancario san
Paolo di Torino 42,091 265
Istituto Nazionale 323,919 447
Italgas 5,000 15
Mediobanca 30,950 176
Montedison* 134,680 82
Olivetti* 142,500 41
Parmalat Finanziaria 102,800 147
Pirelli 120,000 261
RAS 10,135 77
Sirti 19,500 112
Telecom Italia 265,000 730
Telecom Italia di Risp 63,000 138
Telecom Italia Mobile 195,802 575
Telecom Italia Mobile di Risp 154,164 269
----------
Total Italy 5,408
----------
JAPAN (23.5%)
Ajinomoto 15,000 151
Asahi Bank 20,000 131
Asahi Chemical Industries 15,000 83
Asahi Glass 12,000 116
62
<PAGE>
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
JAPAN--CONTINUED
Bank of Tokyo - Mitsubushi 24,000 $ 416
Bank of Yokohama 11,000 55
Bridgestone 9,000 203
Chiba Bank 12,000 62
Chiyoda 5,000 24
Citizen Watch 11,000 83
Cosmo Oil 12,000 55
Dai Nippon Printing 12,000 240
Daiei* 11,000 72
Daiwa Kosho Lease 5,000 38
Daiwa Securities 18,000 132
Ebara 8,000 116
Fanuc 900 32
Fuji Bank 24,000 309
Fuji Photo Film 5,000 194
Fujitsu 18,000 220
Furukawa Electric 15,000 89
Hankyu 2,000 10
Hitachi 32,000 341
Honda Motor 5,000 147
Industrial Bank of Japan 20,000 241
Ito Ham Foods 1,000 6
Ito Yokado 4,000 228
Itochu 31,000 158
Japan Air Lines* 16,000 68
Japan Energy 11,000 28
Joyo Bank 14,300 70
Jusco 3,000 101
Kansai Electric Power 9,800 184
Kao 7,000 95
Kawasaki Steel 19,000 56
Kinki Nippon Railway 26,000 156
Kirin Brewery 15,000 148
Komatsu 13,000 98
Kubota 23,000 106
Kyocera 3,000 216
Marui 4,000 75
Matsushita Electric 18,000 339
Mitsubishi 21,000 247
Mitsubishi Chemical 16,000 49
Mitsubishi Electric 23,000 130
Mitsubishi Estate 5,000 68
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
JAPAN--CONTINUED
Mitsubishi Heavy Industries 43,000 $ 310
Mitsubishi Materials 35,000 136
Mitsubishi Trust & Banking 13,000 186
Mitsui 17,000 150
Mitsui Trust & Banking 13,000 98
Mitsukoshi 7,000 49
Murata Manufacturing 1,000 40
NEC 15,000 209
New Oji Paper 9,000 52
Nichido Fire & Marine Insurance 15,000 91
Nippon Express 5,000 39
Nippon Oil 16,000 81
Nippon Paper Industries* 1,000 5
Nippon Sharyo 5,000 32
Nippon Steel 39,000 114
Nippon Yusen 27,000 111
Nippondenso 7,000 175
Nissan Motor 32,000 212
NKK 24,000 47
Nomura Securities 19,000 225
Obayashi 13,000 80
Odakyu Electric Railway 24,000 133
Olympus Optical 8,000 68
Osaka Gas 44,000 116
Sakura Bank 25,000 150
Sankyo 7,000 222
Sanyo Electric 4,000 17
Sega Enterprises 1,600 54
Sekisui Chemical 7,000 73
Sekisui House 7,000 69
Sharp 10,000 129
Shimizu 3,000 18
Shin - Etsu Chemical 7,000 176
Shizuoka Bank 9,000 87
Skylark 3,000 50
Sony 3,500 295
Sumitomo Bank 28,000 387
Sumitomo Chemical 20,000 83
Sumitomo Metal 26,000 66
Taisei 35,000 150
Takeda Chemical 15,000 380
Tobu Railway 15,000 67
63
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
INTERNATIONAL EQUITY INDEX FUND--CONTINUED
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
JAPAN--CONTINUED
Tohoku Electric Power 5,300 $ 91
Tokai Bank 20,000 165
Tokio Marine & Fire Insurance 34,000 400
Tokyo Electric Power 15,900 303
Tokyo Gas 26,000 66
Tokyu 10,000 57
Toppan Printing 11,000 151
Toray 24,000 163
Tostem 3,000 80
Toto 7,700 87
Toyo Seikan Kaisha 3,300 63
Toyoda Automatic Loom 4,000 87
Toyota Motor 31,000 889
Yamaichi Securities 15,000 43
Yamanouchi Pharmaceutical 1,000 25
Yasuda Trust & Banking 5,000 15
----------
Total Japan 14,103
----------
NETHERLANDS (3.1%)
ABN-Amro Holdings 10,668 197
Akzo Nobel 470 63
ING Groep 5,816 257
Koninklijke 3,789 132
Koninklijke Nederlanden
Papierfabriek 960 20
Philips Electronics 2,550 139
Royal Dutch Petroleum 3,580 691
Unilever 1,065 205
Wolters Kluwer 1,479 178
----------
Total Netherlands 1,882
----------
NORWAY (1.2%)
Bergesen, Cl A 4,150 96
Hafslund Nycomed, Cl B 5,900 33
Kvaerner 2,000 115
Norsk Hydro 7,825 391
Nycomed Asa- Cl B 2,300 31
Uni Storebrand* 9,987 66
----------
Total Norway 732
----------
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
SPAIN (4.7%)
Argentaria Bancaria de Espana 2,916 $ 145
Autopistas CESA 6,347 78
Banco Bilbao Vizcaya 4,571 324
Banco Central Hispano 4,255 137
Banco de Santander 3,510 299
Dragados Construccion 2,565 50
Empresa Nacional de Electricidad 5,473 418
Fomento de Construcciones
Contratas 598 67
Gas Natural 828 158
Iberdola 16,206 199
Mapfre 1,018 55
Repsol 6,279 263
Telefonica de Espana 19,933 575
Union Electrica Fenosa 7,629 68
----------
Total Spain 2,836
----------
SWEDEN (2.0%)
Asea, Cl A 12,000 162
Astra, Cl A 14,666 237
Diligentia* 1,350 15
Electrolux, Cl B 1,100 66
Ericsson, Cl B 8,100 284
Granges* 550 7
Skandinaviska Enskilda Banken 7,700 79
Skanska Rights* 1,800 --
Skanska, Cl B 1,800 72
Stora Kopparbergs Bergslags, Cl A 5,000 74
Svenska Cellulosa, Cl B 4,000 84
Swedish Match 4,500 15
Volvo, Cl B 3,950 109
----------
Total Sweden 1,204
----------
SWITZERLAND (2.3%)
Nestle 222 276
Novartis 244 331
Roche Holdings, Bearer 7 92
Roche Holdings, Genusshein 34 302
Schweizerische Bankgesellschaft 170 186
Swiss Bank* 875 210
----------
Total Switzerland 1,397
----------
64
<PAGE>
================================================================================
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
UNITED KINGDOM (8.2%)
Abbey National 8,291 $ 119
Barclays Bank 14,416 280
Bass 9,466 123
BAT Industries 22,460 201
BG 20,778 69
Blue Circle Industries 12,797 88
British Petroleum 41,753 495
British Telecommunications 20,475 148
BTR 43,929 143
Cable & Wireless 22,390 183
Centrica* 20,778 22
Energy Group* 9,677 87
General Electric 21,236 121
Glaxo Wellcome 19,999 399
Grand Metropolitan 23,365 217
Great Universal Stores 7,352 78
Guinness 18,085 168
Hanson 12,096 62
HSBC Holdings 7,895 245
Imperial Chemical 11,454 152
Marks & Spencer 40,514 337
National Power 9,177 83
Reuters 13,125 147
RMC Group 2,799 42
RTZ 13,785 236
Sainsbury, J. 11,344 65
Smithkline Beecham 20,334 350
Unilever 6,230 167
Vodafone Group 22,646 100
----------
Total United Kingdom 4,927
----------
UNITED STATES (0.1%)
Millennium Chemicals* 1,382 27
----------
Total U.S. and Foreign Common Stocks
(Cost $48,937) 57,252
----------
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
FOREIGN PREFERRED STOCKS (1.3%)
FINLAND (0.3%)
Nokia, Cl A 2,400 $ 157
----------
GERMANY (0.9%)
RWE 3,730 131
SAP 1,380 251
Volkswagen 297 146
----------
Total Germany 528
----------
ITALY (0.1%)
Fiat 42,800 72
----------
Total Foreign Preferred Stocks
(Cost $571) 757
----------
Total Investments (96.7%)
(Cost $49,508) 58,009
----------
OTHER ASSETS AND LIABILITIES, NET (3.3%) 1,999
----------
65
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
INTERNATIONAL EQUITY INDEX FUND--CONCLUDED
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization -- no
par value) based on 4,717,839
outstanding shares of beneficial interest $ 43,186
Fund shares of the Investor Shares
(unlimited authorization -- no
par value) based on 496,770
outstanding shares of beneficial interest 4,962
Fund shares of the Flex Shares
(unlimited authorization -- no
par value) based on 80,102
outstanding shares of beneficial interest 829
Undistributed net investment income 220
Accumulated net realized gain on
investments and foreign currency
transactions 2,335
Net unrealized appreciation
on investments 8,501
Net unrealized depreciation on foreign
currency and translation of other
assets and liabilities in foreign currency (25)
----------
Total Net Assets (100.0%) $ 60,008
==========
Net Asset Value, Offering and Redemption
Price Per Share-- Trust Shares $ 11.34
==========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 11.26
==========
Maximum Offering Price Per Share --
Investor Shares ($11.26 (Divide) 96.25%) $ 11.70
==========
Net Asset Value, Offering and Redemption
Price Per Share-- Flex Shares (1) $ 11.24
==========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
66
<PAGE>
INTERNATIONAL EQUITY FUND
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
FOREIGN COMMON STOCKS (97.3%)
ARGENTINA (0.9%)
YPF ADR, Cl D 160,000 $ 4,800
----------
AUSTRALIA (2.0%)
Australia & New Zealand
Bank Group 350,000 2,396
Faulding (F.H.) & Co. 405,124 2,412
QBE Insurance 922,000 5,486
----------
Total Australia 10,294
----------
BRAZIL (2.8%)
Souza Cruz 838,000 7,827
Telecom Brasileiras ADR 47,800 6,567
----------
Total Brazil 14,394
----------
CANADA (3.3%)
Bank of Montreal 71,991 2,744
Bombardier, Cl B 201,000 4,220
CAE 436,729 3,431
Royal Bank of Canada 57,000 2,468
Suncor 158,000 3,918
----------
Total Canada 16,781
----------
DENMARK (0.9%)
Sophus Berendsen, Cl B 29,550 4,471
----------
FINLAND (4.3%)
Cultor, Ser 2 82,400 4,129
Finnlines 100,000 2,777
Metra, Cl B 195,000 5,529
Nokia ADR, Cl A 41,000 2,706
Rauma 72,200 1,683
UPM - Kymmene 208,000 4,774
----------
Total Finland 21,598
----------
FRANCE (9.7%)
Accor 34,000 4,708
Christian Dior 30,850 4,832
Cie Generale d'Industrie et de
Participations 23,000 6,524
Credit Local de France 55,000 5,131
Lafarge Coppee 38,000 2,427
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
FRANCE--CONTINUED
Lagardere Groupe 158,000 $ 4,643
SGS-Thomson
Microelectronics ADR* 66,000 5,511
Technip 153,113 15,714
----------
Total France 49,490
----------
GERMANY (3.3%)
Siemens 48,000 2,713
Veba 79,600 4,525
Volkswagen 14,300 9,288
----------
Total Germany 16,526
----------
GREECE (2.0%)
Greek Telecom 411,840 10,253
----------
HONG KONG (1.2%)
HSBC Holdings 192,645 5,843
----------
HUNGARY (0.6%)
Gedeon Richter 32,000 2,656
Gedeon Richter GDR 3,000 249
----------
Total Hungary 2,905
----------
INDONESIA (0.5%)
Modern Photo Film, F 736,500 2,681
----------
ISRAEL (2.1%)
ECI Telecommunications 319,000 7,377
Technomatrix Technologies 105,500 3,244
----------
Total Israel 10,621
----------
ITALY (3.1%)
Banca Popolare di Milano 500,000 2,686
ENI 933,000 4,655
Istituto Bancario san
Paolo di Torino 450,002 2,831
Saipem 1,057,000 5,376
----------
Total Italy 15,548
----------
JAPAN (8.8%)
Canon 215,000 5,448
FCC 97,000 2,516
67
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
INTERNATIONAL EQUITY FUND--CONCLUDED
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
JAPAN--CONTINUED
Fuji Photo Film 139,000 $ 5,385
Honda Motor 282,000 8,285
Sony 99,400 8,377
TDK 69,000 5,299
Terumo 546,000 9,615
----------
Total Japan 44,925
----------
MALAYSIA (0.9%)
UMW Holdings 844,000 4,334
----------
MEXICO (2.5%)
Fomento Econo Mexicana, Cl B 1,676,000 8,906
Panamerican Beverage, Cl A 130,200 3,776
----------
Total Mexico 12,682
----------
NETHERLANDS (5.5%)
Akzo Nobel 53,000 7,051
Hollandsche Beton Groep 28,658 6,590
ING Groep 327,938 14,486
----------
Total Netherlands 28,127
----------
NEW ZEALAND (1.0%)
Fletcher Challenge Building
Division 1,831,500 5,114
----------
PANAMA (1.4%)
Banco Latinamericano de
Exportaciones 150,400 7,088
----------
PERU (1.1%)
CPT Telefoncia del Peru 109,000 2,766
Credicorp 124,449 2,816
----------
Total Peru 5,582
----------
PHILIPPINES (1.1%)
Benpres GDR* 775,961 5,509
----------
PORTUGAL (1.5%)
Banco Espirito Santo 120,400 2,493
Portugal Telecom ADR 134,300 5,171
----------
Total Portugal 7,664
----------
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
SINGAPORE (0.7%)
Elec & Eltek International 599,000 $ 3,534
----------
SOUTH AFRICA (5.0%)
Barlow 442,000 4,676
De Beers Consolidated
Mines ADR 70,200 2,475
First National Bank 373,000 2,911
Gencor 1,048,000 4,599
Liberty Life Association of Africa 50,000 1,399
Rembrandt Group 446,000 4,494
Sasol 385,000 4,720
----------
Total South Africa 25,274
----------
SOUTH KOREA (3.4%)
Pohang Iron & Steel 107,531 9,209
Samsung Electronics 29,590 2,897
Samsung Electronics Rights* 490 11
Sindo Ricoh 91,400 5,282
----------
Total South Korea 17,399
----------
SPAIN (3.4%)
Corporacion Financiera Alba 49,000 5,391
Telefonica de Espana 414,000 11,946
----------
Total Spain 17,337
----------
SWEDEN (3.1%)
Castellum AB* 130,000 906
Ericsson, Cl B 168,100 5,899
Skandia Forsakrings 250,000 8,822
----------
Total Sweden 15,627
----------
SWITZERLAND (6.7%)
Asea Brown Boveri 4,215 5,785
Nestle 9,000 11,194
Novartis, Registered 12,640 17,151
----------
Total Switzerland 34,130
----------
UNITED KINGDOM (14.5%)
Avis Europe* 2,500,000 5,356
Bank of Ireland 769,715 8,327
Bass 400,000 5,187
68
<PAGE>
================================================================================
- ------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
- ------------------------------------------------------------
UNITED KINGDOM--CONTINUED
BOC Group 163,000 $ 2,735
Granada Group 315,000 4,464
Halma 1,196,000 3,442
London Forfaiting 1,763,200 11,577
Morgan Crucible 717,432 5,344
Powerscreen 513,100 5,232
Railtrack Group* 462,000 4,835
Reckit & Colman 554,000 7,791
Smithkline Beecham 306,484 5,270
Vodafone Group 980,000 4,343
----------
Total United Kingdom 73,903
----------
Total Foreign Common Stocks
(Cost $429,604) 494,434
----------
TIME DEPOSIT (2.8%)
Cayman Island
5.250%, 06/02/97 $14,500 14,500
----------
Total Time Deposit
(Cost $14,500) 14,500
----------
Total Investments (100.1%)
(Cost $444,104) 508,934
----------
OTHER ASSETS AND LIABILITIES, NET (-0.1%) (560)
----------
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization -- no
par value) based on 35,898,515
outstanding shares of
beneficial interest $ 399,733
Fund shares of the Investor Shares
(unlimited authorization -- no par
value) based on 786,012 outstanding
shares of beneficial interest 9,162
Fund shares of the Flex Shares
(unlimited authorization -- no
par value) based on 621,903
outstanding shares of
beneficial interest 7,607
Undistributed net investment income 834
Accumulated net realized gain on
investments and foreign
currency transactions 26,202
Net unrealized appreciation
on investments 64,830
Net unrealized appreciation on
foreign currency and translation
of other assets and liabilities in
foreign currency 6
----------
Total Net Assets (100.0%) $ 508,374
==========
Net Asset Value, Offering and Redemption
Price Per Share-- Trust Shares $ 13.63
==========
Net Asset Value and Redemption Price
Per Share-- Investor Shares $ 13.58
==========
Maximum Offering Price Per Share --
Investor Shares ($13.58 / 96.25%) $ 14.11
==========
Net Asset Value, Offering and Redemption
Price Per Share-- Flex Shares (1) $ 13.47
==========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
69
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
SUNBELT EQUITY FUND
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
COMMON STOCKS (94.3%)
BASIC MATERIALS (1.2%)
Blount International 100,649 $ 4,152
Citation* 65,268 971
----------
Total Basic Materials 5,123
----------
CAPITAL GOODS (9.2%)
Agco 145,197 4,628
American Buildings* 156,275 4,415
American Homestar* 156,914 3,138
Browning Ferris Industries 60,659 1,987
Greenfield Industries 143,198 3,723
Intermet 301,822 4,226
Maverick Tube* 126,699 3,833
Palm Harbor Homes* 126,814 3,583
Roper Industries 41,105 2,019
Tracor* 79,461 2,016
Watsco 164,769 4,778
----------
Total Capital Goods 38,346
----------
COMMUNICATION SERVICES (2.3%)
Premiere Technologies* 162,964 4,380
U.S. Long Distance* 335,286 5,197
----------
Total Communication Services 9,577
----------
CONSUMER CYCLICALS (19.1%)
Barnett* 251,979 5,607
Books-A-Million* 364,468 1,868
Central Parking 86,890 2,715
Claire's Stores 190,753 3,672
Dollar General 236,344 7,947
Family Dollar Stores 159,553 4,108
Heilig-Meyers 413,167 6,817
Home Depot 64,703 4,076
Miller Industries* 524,807 8,594
O'Charleys* 109,669 1,563
Pier 1 Imports 79,777 1,785
Play By Play Toys & Novelties* 90,204 1,409
Promus Hotel* 199,826 7,219
Rare Hospitality International* 221,310 3,486
Richfood Holdings 275,860 6,379
Stein Mart* 198,738 6,012
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
CONSUMER CYCLICALS--CONTINUED
Tractor Supply* 169,673 $ 3,478
Suburban Lodges of America* 119,666 2,513
----------
Total Consumer Cyclicals 79,248
----------
CONSUMER STAPLES (1.9%)
Flowers Industries 179,497 3,164
Tyson Foods 224,809 4,609
----------
Total Consumer Staples 7,773
----------
ENERGY (21.7%)
Anadarko Petroleum 74,294 4,681
BJ Services* 86,013 4,752
Baker Hughes 110,638 4,149
Cairn Energy USA* 70,547 833
Diamond Offshore Drilling* 122,095 8,684
Ensco International* 109,330 5,453
Global Industries* 264,743 5,824
Global Marine* 289,298 6,509
Nuevo Energy* 218,321 9,524
Oceaneering International* 104,407 1,775
Offshore Logistics* 167,668 3,039
Pride Petroleum Service* 365,188 8,125
Production Operators 80,518 5,385
St Mary Land & Exploration 79,777 2,533
Stone Energy* 288,296 8,072
Tidewater 126,926 5,347
Transocean Offshore 45,716 3,154
World Fuel Services 104,839 2,110
----------
Total Energy 89,949
----------
FINANCIALS (6.9%)
AmSouth Bancorp 60,660 2,373
BB&T 21,029 841
CCB Financial 52,650 3,699
Central Fidelity Banks 28,307 828
Cullen/Frost Bankers 22,646 892
Equity Inns REIT 222,416 2,919
Fairfield Communities* 131,638 4,393
First Enterprise Financial Group* 161,692 950
First Virginia Banks 16,176 906
Regions Financial 13,749 822
70
<PAGE>
================================================================================
- ------------------------------------------------------------
SHARES VALUE (000)
- ------------------------------------------------------------
FINANCIALS--CONTINUED
Texas Regional Bancshares, Cl A 44,300 $ 1,384
Triad Guaranty* 122,286 4,249
Union Planters 62,171 2,938
Winston Hotels REIT 117,435 1,541
----------
Total Financials 28,735
----------
HEALTH CARE (9.7%)
Beverly Enterprises* 487,197 6,882
Compdent* 186,165 3,374
Gulf South Medical Supply* 271,411 5,360
Healthsouth* 151,776 3,472
Owens & Minor Holding 197,426 2,493
Phycor* 255,733 7,320
Quorum Health Group* 241,231 8,534
Serologicals* 139,340 2,665
----------
Total Health Care 40,100
----------
ERVICE INDUSTRIES (5.5%)
Billing Information Concepts* 40,440 1,173
Education Medical* 159,694 1,437
Norrell 240,634 7,760
Nova* 198,384 3,596
PMT Services* 343,137 5,490
Staffmark* 183,054 3,432
----------
Total Service Industries 22,888
----------
TECHNOLOGY (12.5%)
Acxiom* 165,803 2,819
BDM International* 191,467 4,978
Benchmark Electronics* 136,047 4,779
Cybex Computer Products* 79,847 1,452
Harbinger* 155,395 4,817
Input/Output* 250,551 4,447
National Data 133,001 5,835
Nichols Research* 252,683 4,927
SCB Computer Technology* 342,063 7,867
SCI Systems* 5,905 384
Sterling Commerce* 240,417 7,994
Wandel & Goltermann
Technologies* 135,258 1,691
----------
Total Technology 51,990
----------
- ------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
- ------------------------------------------------------------
TRANSPORTATION (4.3%)
American Freightways* 388,181 $ 5,338
Hunt J B Transportation Services 538,819 8,217
MTL* 85,327 1,963
USA Truck* 228,340 2,169
----------
Total Transportation 17,687
----------
Total Common Stocks
(Cost $310,998) 391,416
----------
CONVERTIBLE BONDS (3.4%)
Career Horizons,
CV to 88.1340 Shares
7.000%, 11/01/02 $2,507 5,534
Pride Petroleum Services,
CV to 81.6327 Shares
6.250%, 02/15/06 792 1,465
SCI Finance LLC,
CV to 1.6617 Shares 37 4,247
Sci Systems,
CV to 20.5128 Shares
5.000%, 05/01/06 2,059 3,009
----------
Total Convertible Bonds
(Cost $13,110) 14,255
----------
REPURCHASE AGREEMENT (0.8%)
Deutsche Bank
5.51%, dated 05/30/97,
matures 06/02/97, repurchase
price $3,328,353 (collateralized
by U.S. Treasury Note, par
value $3,373,000,
5.125%, 12/31/98:
total market value $3,393,654) 3,327 3,327
----------
Total Repurchase Agreement
(Cost $3,327) 3,327
----------
Total Investments (98.5%)
(Cost $327,435) 408,998
----------
71
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
SUNBELT EQUITY FUND--CONCLUDED
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (1.5%) $ 6,157
----------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 28,714,327
outstanding shares of beneficial
interest 292,778
Fund shares of the Investor Shares
(unlimited authorization --
no par value) based on 2,151,656
outstanding shares of beneficial
interest 21,236
Fund shares of the Flex Shares
(unlimited authorization --
no par value) based on 437,822
outstanding shares
of beneficial interest 5,505
Undistributed net investment income 39
Accumulated net realized gain
on investments 14,034
Net unrealized appreciation
on investments 81,563
----------
Total Net Assets (100.0%) $ 415,155
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 13.28
==========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 13.06
==========
Maximum Offering Price Per Share --
Investor Class ($13.06 (Divide) 96.25%) $ 13.57
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1)(2) $ 13.00
==========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
(2) Represents NAV on last business day -- May 30, 1997.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
72
<PAGE>
================================================================================
INVESTMENT GRADE TAX-EXEMPT FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
MUNICIPAL BONDS (102.3%)
ARIZONA (1.7%)
Northern Arizona University
Revenue, RB, Callable
06/01/02 @ 101 (FGIC)
6.300%, 06/01/05 $2,770 $ 2,948
----------
CALIFORNIA (4.2%)
Los Angeles, California
Participation Note, COP,
Pre-Refunded 06/01/99 @ 102 (F)
7.000%, 06/01/09 3,765 4,039
Northern California, Power
Agency, RB (AMBAC)
5.850%, 07/01/10 1,295 1,384
State University,
California Public Works, RB,
Pre-Refunded 10/01/02 @ 102 (F)
6.700%, 10/01/17 1,800 2,012
----------
Total California 7,435
----------
FLORIDA (12.2%)
Hillsborough County,
Capital Improvement Program,
Ser B, RB, Callable 07/01/06
@ 102 (MBIA)
5.125%, 07/01/22 3,300 3,073
Okeechobee Correctional Facility,
COP (AMBAC)
5.800%, 03/01/03 1,000 1,044
Orange County, Health Facilities
Authority, RB (MBIA)
6.250%, 10/01/13 1,000 1,093
Reedy Creek, Improvement District
Utility, Ser 1991-1, RB,
Pre-Refunded 10/01/01
@ 101 (MBIA) (F)
6.500%, 10/01/16 2,000 2,169
State Board of Education, Capital
Outlay, Ser C, GO, Pre-Refunded
06/01/02 @ 101 (F)
6.625%, 06/01/22 1,950 2,139
- -----------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
FLORIDA--CONTINUED
State Department of Natural
Resources, Environmental
Preservation 2000 Project, Ser A,
RB, Callable 07/01/01
@ 102 (AMBAC)
6.750%, 07/01/13 $2,000 $ 2,164
Tampa, Allegany Health,
RB, Pre-Refunded 12/01/99
@ 102 (FGIC) (F)
7.375%, 12/01/23 3,500 3,814
Tampa, Capital Improvement
Program, Ser B, RB, Callable
10/01/98 @ 100 (E)
8.375%, 10/01/18 1,000 1,051
Volusia County, Health
Facility Authority, Aces Pooled
Hospital Program, RB, VRDN,
(FGIC) (C) (D)
3.900%, 11/01/15 2,700 2,700
Volusia County, Master Lease
Program, COP, Pre-Refunded
08/01/01 @ 102 (FSA) (F)
6.625%, 08/01/06 2,000 2,190
----------
Total Florida 21,437
----------
GEORGIA (5.7%)
Cobb County, School
District, GO
6.000%, 02/01/01 5,900 6,194
Murray County, School
District, GO
4.800%, 04/01/00 1,150 1,160
4.875%, 10/01/00 1,200 1,214
State, GO
7.250%, 07/01/99 1,305 1,381
----------
Total Georgia 9,949
----------
HAWAII (3.1%)
State, GO
5.750%, 01/01/07 5,150 5,421
----------
73
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
INVESTMENT GRADE TAX-EXEMPT BOND FUND--CONTINUED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
ILLINOIS (3.6%)
Chicago, Board of Education,
GO (AMBAC)
6.750%, 12/01/09 $1,000 $ 1,132
Chicago, State Board of Education,
GO (MBIA)
6.250%, 12/01/09 2,745 3,021
State Health Facilities Authority,
Trinity Medical Center Project,
RB, Callable 07/01/02 @ 102 (FSA)
7.000%, 07/01/12 2,000 2,189
----------
Total Illinois 6,342
----------
INDIANA (3.6%)
Beech Grove, School Building,
RB (MBIA)
6.250%, 07/05/16 2,265 2,464
Health Facilities Financing
Authority, Community Hospitals
of Indiana, RB, Pre-Refunded
07/01/01 @ 102 (MBIA) (F)
7.000%, 07/01/21 3,500 3,869
----------
Total Indiana 6,333
----------
MARYLAND (5.1%)
Baltimore, Metropolitan
District, GO, Callable
07/01/02 @ 102
5.900%, 07/01/04 1,000 1,067
Montgomery County
Public Improvement, Ser A, GO
5.200%, 10/01/00 5,725 5,866
Montgomery County,
Ser A, GO
5.100%, 04/01/99 2,000 2,032
----------
Total Maryland 8,965
----------
MASSACHUSETTS (4.8%)
Boston, City Hospital Project, RB,
Callable 08/15/00 @ 102 (FHA)
7.650%, 02/15/10 1,275 1,410
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
MASSACHUSETTS--CONTINUED
Commonwealth of Massachusetts,
GO, VRDN (C) (D)
4.000%, 12/01/97 $ 7,010 $ 7,010
----------
Total Massachusetts 8,420
----------
NEBRASKA (1.2%)
Omaha, Public Power & Electric
Authority, Ser A, RB, Pre-Refunded
02/01/02 @ 101.50 (F)
6.500%, 02/01/17 2,000 2,180
----------
NEW JERSEY (21.1%)
Economic Development
Authority, Water Facilities,
Ser PJ-B, RB, VRDN
(AMBAC) (C) (D)
3.750%, 11/01/25 7,000 7,000
State, Transportation
Anticipation Note, Ser A, RB,
Callable 03/01/01 @ 100 (FSA)
4.900%, 09/01/01 3,750 3,793
State, Transportation
Anticipation Note, Ser A, RB,
Callable 03/01/03 @ 100 (FSA)
5.400%, 09/01/02 7,000 7,218
5.500%, 09/01/03 13,000 13,478
State, Transportation
Anticipation Note, Ser A, RB,
Callable 03/01/00 @ 100 (FSA)
4.800%, 09/01/00 5,500 5,546
----------
Total New Jersey 37,035
----------
NEW YORK (20.2%)
New York, Ser B, GO
5.600%, 08/15/06 1,500 1,513
New York, Ser J,
GO (MBIA)
6.000%, 02/15/05 3,000 3,194
State, Pre-Refunded
03/01/00 @ 102
(AMBAC) (F)
7.100%, 03/01/20 1,650 1,794
74
<PAGE>
================================================================================
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
NEW YORK--CONTINUED
State Dorm Authority,
RB, Callable 07/01/14
@ 100 (FSA)
5.750%, 07/01/18 $1,800 $ 1,860
State Dorm Authority, State
University Educational
Facilities,
RB (FGIC)
5.875%, 05/15/11 2,000 2,115
State Dorm Authority,
State University Educational
Facilities, Ser A, RB,
Pre-Refunded
05/15/00 @ 102 (F)
7.700%, 05/15/12 5,000 5,539
State Local Assistance
Corporation,
Ser A, RB, Pre-Refunded
04/01/01 @ 102 (F)
7.000%, 04/01/16 5,000 5,524
State Urban Development
RB, Callable 01/01/03
@ 102 (AMBAC)
5.625%, 01/01/07 2,300 2,391
State Urban Development,
RB, Pre-Refunded 01/01/01
@ 102 (F)
7.875%, 01/01/10 3,000 3,383
State Urban Development,
Ser A, RB (MBIA)
6.250%, 04/01/06 2,000 2,186
Triborough, New York, State Bridge
& Tunnel Authority, Ser S, RB,
Pre-Refunded 01/01/01 @ 101.5 (F)
7.000%, 01/01/11 2,000 2,191
Triborough, New York, State Bridge
& Tunnel Authority, Ser X, RB,
Callable 01/01/02 @ 101.50
6.250%, 01/01/04 3,550 3,802
----------
Total New York 35,492
----------
NORTH CAROLINA (0.8%)
Johnston County,
COP (MBIA)
4.150%, 09/01/98 1,380 1,382
----------
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
PENNSYLVANIA (0.6%)
Philadelphia, Water &
Waste, RB (MBIA)
6.250%, 08/01/12 $1,050 $ 1,150
----------
TENNESSEE (3.7%)
Shelby County, GO,
Pre-Refunded 12/01/00
@ 102 (F)
6.250%, 12/01/09 2,000 2,149
State, GO
5.000%, 05/01/99 4,220 4,284
----------
Total Tennessee 6,433
----------
TEXAS (5.3%)
El Paso, GO, Callable
08/15/07 @ 100 (FGIC)
5.000%, 08/15/11 1,000 964
5.000%, 08/15/12 1,000 958
Harris County, Health
Facility Development, Ser A, RB
6.000%, 06/01/12 3,990 4,234
Texas Water Development Board
State Revolving Fund - Senior
Lien, RB, Callable 07/15/02 @ 102
6.000%, 07/15/03 2,000 2,133
University of Texas, RB
6.300%, 08/15/99 1,000 1,041
----------
Total Texas 9,330
----------
UTAH (1.0%)
Intermountain Power Agency,
Ser E, RB (FSA)
6.250%, 07/01/09 1,545 1,699
----------
VIRGINIA (2.9%)
Fairfax County, Ser C, GO,
Callable 05/01/03 @ 102
5.250%, 05/01/07 5,000 5,107
----------
WASHINGTON (0.6%)
Grant County, Washington
School District, GO (FGIC)
6.000%, 12/01/08 1,000 1,073
----------
75
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
INVESTMENT GRADE TAX-EXEMPT BOND FUND--CONCLUDED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
WISCONSIN (0.9%)
Milwaukee County, Ser A,
GO (MBIA)
5.250%, 10/01/03 $1,550 $ 1,593
----------
Total Municipal Bonds
(Cost $178,251) 179,724
----------
CASH EQUIVALENTS (9.9%)
AIM Management
Institutional Tax-Free
Portfolio (C) 8,685 8,685
SEI Tax Exempt Trust
Institutional
Tax Free Portfolio (C) 8,753 8,753
----------
Total Cash Equivalents
(Cost $17,438) 17,438
----------
Total Investments (112.2% )
(Cost $195,689) 197,162
----------
OTHER ASSETS AND LIABILITIES (-12.2%)
Investment securities purchased payable (24,673)
Other assets and liabilities, net 3,193
----------
Total Other Assets and Liabilities (21,480)
----------
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 12,396,746
outstanding shares of beneficial
interest $137,067
Fund shares of the Investor Shares
(unlimited authorization --
no par value) based on 2,834,763
outstanding shares of beneficial
interest 30,459
Fund shares of the Flex Shares
(unlimited authorization --
no par value) based on 416,782
outstanding shares of
beneficial interest 4,716
Accumulated net realized gain
on investments 1,967
Net unrealized appreciation
on investments 1,473
----------
Total Net Assets (100.0%) $ 175,682
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 11.22
==========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 11.24
==========
Maximum Offering Price Per Share --
Investor Class ($11.24 (Divide) 96.25%) $ 11.68
==========
Net Asset Value, Offering and Redemption
Price Per Share-- Flex Shares (1) $ 11.23
==========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
76
<PAGE>
FLORIDA TAX-EXEMPT BOND FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
MUNICIPAL BONDS (89.0%)
FLORIDA (78.7%)
Alachua County, State Health
Facilities Authority, Ser B, RB,
VRDN (MBIA) (C) (D)
3.900%, 12/01/26 $2,300 $2,300
Brevard County, School Board,
Ser A, COP (AMBAC)
5.400%, 07/01/12 1,500 1,510
Brevard County, State Health
Facilities Authority, Holmes
Medical Center Project, RB,
Callable 10/01/03 @ 102 (MBIA)
5.700%, 10/01/08 3,000 3,103
Brevard County, State Health
Facilities Authority, Wuesthoff
Memorial Hospital Project,
RB (MBIA)
6.250%, 04/01/06 930 1,018
Broward County, School District
GO, Pre-Refunded 02/15/99
@ 102 (F)
7.125%, 02/15/08 400 426
Dade County, Aviation Revenue,
Ser A, RB, Callable 10/01/05
@ 102 (AMBAC)
6.000%, 10/01/09 500 534
Dade County, School Board,
COP (AMBAC)
5.750%, 08/01/03 600 631
Dade County, School District,
GO Pre-Refunded 07/01/99
@ 102 (F)
7.200%, 07/01/02 2,000 2,151
7.375%, 07/01/08 250 270
Dade County, Seaport, RB (MBIA)
6.200%, 10/01/08 750 826
6.200%, 10/01/10 1,000 1,094
Dade County, State Educational
Facilities Authority, University
of Miami, Ser A, RB (MBIA)
6.000%, 04/01/08 755 814
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
FLORIDA--CONTINUED
Dade County, Water & Sewer
System, RB (FGIC)
6.250%, 10/01/09 $ 750 $ 827
5.250%, 10/01/21 825 790
Deerfield Beach, Water & Sewer
Revenue, RB (FGIC)
6.125%, 10/01/06 250 273
Gainsville, Utilities Systems,
Ser A, RB
5.750%, 10/01/04 1,300 1,379
5.750%, 10/01/09 500 529
Gulf Breeze, Local Government
Lien, Ser B, RB, Mandatory
Tender 12/01/08 (FGIC)
5.650%, 12/01/15 460 472
Gulf Breeze, Local Government
Lien, Ser B, RB, Mandatory
Tender 12/01/09 (FGIC)
5.750%, 12/01/15 410 421
Hillsborough County, Capital
Improvement Program Ser B,
RB Callable 07/01/06 @ 102 (MBIA)
5.125%, 07/01/22 3,000 2,794
Hillsborough County, Capital
Improvement Revenue, RB (FGIC)
5.900%, 08/01/04 300 320
Hillsborough County, School
Board Revenue, COP, Callable
07/01/06 @ 100 (MBIA)
5.875%, 07/01/08 1,000 1,060
Hillsborough County, University
Community Hospital, RB (MBIA)
6.500%, 08/15/19 145 163
Indian Trace Community, Water
Management Split Benefit,
Ser A-1, RB, Callable 05/01/05
@ 102 (MBIA)
5.500%, 05/01/07 455 474
Jacksonville Excise Taxes, Ser B,
RB, AMT, Callable 10/01/01
@ 101 (FGIC)
4.900%, 10/01/02 590 595
77
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
FLORIDA TAX-EXEMPT BOND FUND--CONTINED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
FLORIDA--CONTINUED
Jacksonville, Florida Excise Tax,
Ser B, RB, AMT, Callable
10/01/03 @ 100 (FGIC)
5.200%, 10/01/04 $1,500 $1,527
Lakeland, Electric & Water
Revenue, RB (FGIC)
6.500%, 10/01/05 1,000 1,113
Lakeland, Electric & Water
Revenue, RB
6.650%, 10/01/98 100 103
Manatee County, Community
Redevelopment Administration,
Center Project, RB, Callable
04/01/00 @ 102.00 (MBIA)
7.000%, 04/01/08 1,000 1,076
North Broward, Hospital District
Revenue, RB (MBIA)
5.950%, 01/01/01 1,000 1,044
Orange County, Health Facilities
Authority, RB (MBIA)
6.250%, 10/01/13 1,000 1,093
Orange County, Public Facilities
Revenue, Ser A, RB, Callable
10/01/04 @ 102 (AMBAC)
5.650%, 10/01/07 200 210
Orlando, Community Water &
Electric Revenue, RB (ETM)
9.625%, 10/01/03 450 569
Orlando, Community Water &
Electric Revenue, Ser D, RB
6.750%, 10/01/17 500 582
Palm Beach, Health Facilities
Revenue, JFK Medical Center
Project, RB, Pre-Refunded
12/01/03 @ 102 (FSA) (F)
5.750%, 12/01/14 165 177
Pinellas County, Morton Plant
Health Systems Project, RB,
Callable 11/15/03 @ 102 (MBIA)
5.500%, 11/15/08 1,500 1,541
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
FLORIDA--CONTINUED
Plant City, Utility System
Revenue, RB, Callable
10/01/04 @ 101 (MBIA)
6.000%, 10/01/15 $ 400 $ 426
Reedy Creek, Utility Revenue,
Ser 1991-1, RB, Pre-Refunded
10/01/01 @ 101 (MBIA) (F)
6.250%, 10/01/11 240 258
South Broward, Hospital District,
RB, Callable 05/01/03
@ 102 (AMBAC)
7.500%, 05/01/08 1,920 2,195
State Board General Financial
Services, Department of
Environmental Preservation,
RB (AMBAC)
5.125%, 07/01/07 1,500 1,518
State Board of Education, Capital
Outlay, RB
6.600%, 06/01/98 125 128
State Board of Education Capital
Outlay, GO, Pre-Refunded
06/01/00 @ 102 (F)
7.250%, 06/01/23 2,695 2,953
State Board of Education, Capital
Outlay, Ser B, GO, Callable
06/01/02 @ 101
5.900%, 06/01/12 450 463
State Board of Education, Capital
Outlay, Ser B, RB, Callable
06/01/02 @ 101
6.000%, 06/01/15 170 175
State Board of Education, Ser C,
GO, Pre-Refunded 06/01/97
@ 102 (ETM) (F)
7.100%, 06/01/07 190 194
State Board of Finance Department,
General Services Revenue,
Environmental Preservation
2000, Ser A, RB (AMBAC)
5.300%, 07/01/04 460 474
78
<PAGE>
================================================================================
- --------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- --------------------------------------------------------------
FLORIDA--CONTINUED
State Department of Natural Resources,
Preservation 2000 Project,
Ser A, RB, Callable 07/01/01
@ 102 (AMBAC)
6.750%, 07/01/06 $ 80 $ 87
State Keys, Aqueduct Authority
Revenue, RB, Pre-Refunded
09/01/01 @ 101 (AMBAC) (F)
6.750%, 09/01/21 170 186
State Pollution Control, Ser N,
GO, Callable 07/01/96 @ 102
8.000%, 07/01/97 420 422
Tallahassee Construction Utility
System, RB, Pre-Refunded
10/01/99 @ 102 (F)
6.900%, 10/01/14 240 258
Tampa, RB, Callable 10/1/01
@ 102 (AMBAC)
7.050%, 10/01/07 1,000 1,105
----------
Total Florida 44,651
----------
PUERTO RICO (10.3%)
Commonwealth, Highway &
Transportation Authority,
Ser Z, RB (MBIA)
6.250%, 07/01/14 2,000 2,193
Commonwealth, GO, (MBIA)
5.650%, 07/01/15 1,000 1,026
Electric Power Authority, Ser S, RB
5.500%, 07/01/00 200 205
Electric Power Authority, RB, (MBIA)
6.125%, 07/01/09 1,000 1,094
- --------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- --------------------------------------------------------------
PUERTO RICO--CONTINUED
Public Buildings Authority,
Guaranteed Government
Facilities, Ser A, RB (AMBAC)
6.250%, 07/01/14 $ 750 $ 822
Public Buildings Authority
Revenue, Public Education
& Health
Facilities, RB
5.300%, 07/01/03 475 483
----------
Total Puerto Rico 5,823
----------
Total Municipal Bonds
(Cost $49,674) 50,474
----------
CASH EQUIVALENTS (9.8%)
AIM Management Institutional
Tax-Free Portfolio 2,782 2,782
SEI Tax Exempt Trust
Institutional
Tax Free Portfolio 2,767 2,767
----------
Total Cash Equivalents
(Cost $5,549) 5,549
----------
Total Investments (98.8%)
(Cost $55,223) 56,023
----------
OTHER ASSETS AND LIABILITIES, NET (1.2%) 690
----------
79
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
FLORIDA TAX-EXEMPT BOND FUND--CONCLUDED
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 4,910,796
outstanding shares of beneficial
interest $50,028
Fund shares of the Investor Shares
(unlimited authorization -- no par
value) based on 313,587 outstanding
shares of beneficial interest 3,103
Fund shares of the Flex Shares (unlimited
authorization -- no par value) based
on 291,278 outstanding shares of
beneficial interest 2,992
Accumulated net realized loss
on investments (210)
Net unrealized appreciation
on investments 800
----------
Total Net Assets (100.0%) $ 56,713
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 10.28
==========
Net Asset Value and Redemption Price Per
Share-- Investor Shares $ 10.29
==========
Maximum Offering Price Per Share --
Investor Class ($10.29 (Divide) 96.25%) $ 10.69
==========
Net Asset Value, Offering and Redemption
Price Per Share-- Flex Shares (1) $ 10.30
==========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
<PAGE>
80
================================================================================
TENNESSEE TAX-EXEMPT BOND FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
MUNICIPAL BONDS (89.1%)
PUERTO RICO (11.9%)
Commonwealth, GO, Callable
07/01/05 @ 100 (MBIA)
5.500%, 07/01/13 $175 $ 176
Commonwealth, Highway &
Transportation Authority,
Ser Z, RB (MBIA)
6.250%, 07/01/15 500 549
---------
Total Puerto Rico 725
---------
TENNESSEE (77.2%)
Chattanooga, GO, Callable
08/01/02 @ 102
5.900%, 08/01/05 50 53
Chattanooga, Health Facilities
Board, Memorial Hospital
Project, Ser A, RB (MBIA)
6.300%, 09/01/05 20 22
Chattanooga-Hamilton County,
Erlanger Medical Center
Project, RB (FSA)
5.600%, 10/01/08 50 52
Hamilton County, GO, Callable
07/01/04 @ 102
5.500%, 07/01/08 100 103
Harpeth Valley, Utility District
Revenue, RB, Callable
09/01/03 @ 102
5.625%, 09/01/07 100 104
Jackson, Water & Sewer Utilities
Revenue, RB, Callable
07/01/06 @ 100 (AMBAC)
5.250%, 07/01/11 200 198
Johnson City, Water & Sewer
Regulation System, GO,
Callable 05/01/06 @ 100 (AMBAC)
5.800%, 05/01/09 100 104
Kingsport, GO
5.500%, 09/01/02 50 52
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
TENNESSEE--CONTINUED
Knox County, First Utility District
Sewer Revenue, RB, Callable
12/01/97 @ 100 (ETM)
7.250%, 12/01/05 $ 55 $ 64
Knox County, Health Facilities
Board, Mercy Health Systems,
Ser B, RB, Callable 09/01/05
@ 100 (AMBAC)
5.875%, 09/01/15 50 51
Knoxville, Natural Gas Revenue,
Ser E, RB, Callable 03/01/03 @ 100
5.900%, 03/01/10 100 103
Madison County, Ser A, GO,
Callable 08/01/01 @ 102
6.000%, 08/01/05 40 42
Madison County, Water Revenue,
RB, Callable 02/01/08
@ 100 (MBIA)
5.500%, 02/01/09 250 255
Memphis-Shelby County,
Airport Authority, Ser B,
RB, AMT (MBIA)
6.500%, 02/15/09 85 94
Memphis-Shelby County, Airport
Authority, RB, Callable
09/01/05 @ 100 (MBIA)
5.550%, 09/01/08 50 52
Metro Government, Nashville
& Davidson County, Convention
Center Project, GO (ETM)
6.250%, 03/01/10 200 219
Metro Government, Nashville &
Davidson County, Correctional
Facility Improvements, RB,
Callable 09/01/01 @ 102
7.000%, 09/01/11 100 109
Metro Government, Nashville &
Davidson County, Electric System
Revenue, RB (ETM)
6.000%, 07/01/04 100 107
81
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
TENNESSEE TAX-EXEMPT BOND FUND--CONCLUDED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
TENNESSEE--CONTINUED
Metro Government, Nashville &
Davidson County, Electric System
Revenue, RB
5.625%, 05/15/14 $200 $ 203
Metro Government, Nashville &
Davidson County, Vanderbilt
University Hospital, RB,
Callable 07/01/06 @ 100 (ETM)
6.100%, 07/01/10 100 106
Metro Government, Nashville &
Davidson County, Vanderbilt
University, Ser A, RB
5.500%, 01/01/06 125 130
Metro Government, Nashville &
Davidson County, Water &
Sewer Revenue, RB (ETM)
6.500%, 12/01/14 225 251
Metro Government, Nashville &
Davidson County, Water &
Sewer, RB, Callable 01/01/04
@ 100 (AMBAC)
5.900%, 01/01/07 100 105
Nashville & Davidson County,
State Sports Authority Stadium
Project, RB, Callable 07/01/06
@ 101 (AMBAC)
5.750%, 07/01/15 100 102
Shelby County, School Boards,
GO, Callable 03/01/02 @ 101
5.800%, 03/01/10 300 309
Shelby County, Ser A, GO
5.500%, 03/01/10 300 307
Shelby County, Ser B, GO
5.100%, 03/01/00 750 763
State GO, Ser A, Callable
03/01/07 @ 100
5.500%, 03/01/09 50 52
State GO, Ser C
5.000%, 03/01/04 100 102
State Housing Development
Agency, Ser A, RB (AMBAC)
6.550%, 01/01/08 50 52
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
TENNESSEE--CONTINUED
State Local Development Authority,
State Loan Program, Ser A, RB,
Callable 03/01/04 @ 100
7.000%, 03/01/12 $ 50 $ 54
State Metropolitan Nashville Airport,
Ser B, RB, Pre-Refunded 07/01/01
@ 102 (FGIC)(F)
7.750%, 07/01/06 100 113
State School Board Authority, Higher
Education Facilities, Ser A, RB,
Callable 05/01/02 @ 101.50
5.800%, 05/01/04 150 158
Sullivan County, Health Facilities
Board, Holston Valley Health,
RB, Callable 02/15/03 @ 102 (MBIA)
5.750%, 02/15/13 50 51
Williamson County, Rural School,
GO, Callable 09/01/06 @ 100
5.400%, 09/01/07 50 52
---------
Total Tennessee 4,694
---------
Total Municipal Bonds
(Cost $5,299) 5,419
---------
CASH EQUIVALENTS (9.8%)
Aim Management Institutional
Tax Free Portfolio 292 292
SEI Tax-Exempt Trust Institutional
Tax-Free Portfolio 302 302
---------
Total Cash Equivalents
(Cost $594) 594
---------
Total Investments (98.9%)
(Cost $5,893) 6,013
---------
OTHER ASSETS AND LIABILITIES, NET (1.1%) 67
---------
82
<PAGE>
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 204,829
outstanding shares of beneficial
interest $ 1,913
Fund shares of the Investor Shares
(unlimited authorization --
no par value) based on 166,059
outstanding shares of beneficial
interest 1,570
Fund shares of the Flex Shares
(unlimited authorization --
no par value) based on 259,932
outstanding shares of
beneficial interest 2,489
Accumulated net realized loss
on investments (12)
Net unrealized appreciation
on investments 120
---------
Total Net Assets (100.0%) $ 6,080
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 9.63
=========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 9.65
=========
Maximum Offering Price Per Share -- Investor
Class ($9.65 (Divide) 96.25%) $ 10.03
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.64
=========
(1) The Flex Shares have a contingent sales charge. Fora description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
83
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
GEORGIA TAX-EXEMPT BOND FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
MUNICIPAL BONDS (89.6%)
GEORGIA (89.6%)
Albany-Dougherty County, State
Hospital Authority, Ser B,
Anticipation Certificate,
Pre-Refunded 09/01/00 @ 102
(AMBAC) (F)
7.500%, 09/01/20 $ 255 $ 282
Athens, Water & Sewer Revenue,
RB (ETM) (F)
5.700%, 07/01/00 165 171
Atlanta Airport Facility, RB
6.000%, 01/01/03 500 531
6.000%, 01/01/04 500 534
Augusta, Water & Sewer, RB,
Callable 05/01/02 @ 102
6.200%, 05/01/03 130 141
Bibb County, GO
7.000%, 01/01/04 985 1,103
Bulloch County
School District, GO
5.250%, 02/01/17 1,000 968
Clayton County, Water & Sewer
Authority, RB (AMBAC)
5.350%, 05/01/09 1,500 1,519
Cobb County & Marietta, Coliseum
& Exhibit Hall Authority, RB (MBIA)
5.500%, 10/01/12 940 956
Cobb County & Marietta, Water
Authority, RB
5.100%, 11/01/04 1,000 1,019
Cobb County, GO
5.000%, 02/01/03 1,025 1,040
Cobb County, Water & Sewer
Authority, Callable 07/01/04 @ 102
5.125%, 07/01/05 345 352
Columbus Water & Sewer,
RB (FGIC)
5.625%, 05/01/13 1,055 1,070
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
GEORGIA--CONTINUED
Dalton-Whitfield County, Hospital
Authority, RB, Pre-Refunded
07/01/00 @ 102 (F)
7.000%, 07/01/03 $ 355 $ 386
DeKalb County, Development
Authority, Emory University
Project, RB (F)
5.375%, 11/01/05 1,650 1,710
DeKalb County, Development
Authority, Emory University
Project, Ser A, RB
5.200%, 11/01/08 500 506
DeKalb County, School District,
Ser A, GO
6.250%, 07/01/11 1,500 1,649
DeKalb County, Water & Sewer
Authority, RB, Callable
10/01/03 @ 102
5.125%, 10/01/14 1,455 1,398
Douglas County, School District,
GO (MBIA)
5.650%, 01/01/09 805 832
Douglasville - Douglas County,
Water and Sewer
Authority, RB (AMBAC)
5.625%, 06/01/15 350 357
East Point Building Authority,
RB (AMBAC)
4.800%, 02/01/07 535 525
Fayette County, School District, GO
6.250%, 03/01/07 450 494
Fayette County, Water Authority,
RB (MBIA) (ETM)
8.550%, 10/01/01 300 346
Forsyth County, School
District, GO (MBIA)
5.350%, 07/01/10 680 685
Forsyth County, GO
6.500%, 07/01/06 1,000 1,113
84
<PAGE>
================================================================================
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
GEORGIA--CONTINUED
Fulton County, Hospital Authority,
Northside Hospital Project, Ser B,
RB, Pre-Refunded 10/01/02
@ 102 (MBIA) (F)
6.600%, 10/01/11 $2,000 $2,214
Gwinnett County Recreation
Authority,RB
5.800%, 02/01/06 785 835
5.875%, 02/01/07 1,390 1,489
Gwinnett County, School
District, GO
6.400%, 02/01/06 500 553
Gwinnett County, School
District, Ser B, GO
6.400%, 02/01/07 1,000 1,113
Hall County, GO
6.300%, 12/01/05 675 739
Hartwell, Combined Utility
Revenue, RB, Callable
01/01/06 @ 102 (FSA)
5.500%, 01/01/16 1,000 991
Henry County, GO
6.300%, 08/01/08 300 331
Henry County, School District,
School Improvements, RB
6.450%, 08/01/11 500 555
Henry County, School District,
Ser A, GO
6.150%, 08/01/06 150 163
Henry County, School District,
Ser B, GO (MBIA)
5.500%, 08/01/01 350 363
Housing Authority, Single Family
Mortgage, Ser B, Sub-ser B-1, RB
5.550%, 12/01/07 550 561
Medical Center Hospital Authority,
Columbus Regional Healthcare
System, RB (MBIA)
6.000%, 08/01/06 1,000 1,070
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
GEORGIA--CONTINUED
Meriwether County, School
District, GO (FSA)
7.000%, 02/01/06 $ 740 $ 847
5.500%, 02/01/16 1,000 990
Milledgeville, Water & Sewer,
RB (FSA)
6.000%, 12/01/16 1,000 1,069
Paulding County, School
District, Ser A, GO
6.625%, 02/01/07 1,000 1,123
6.625%, 02/01/08 500 563
Private Colleges & Universities
Facilities Authority, Emory
University Project, Ser C, RB,
Callable 10/01/02 @ 102
5.900%, 10/01/04 305 325
Private Colleges & Universities
Facilities Authority, Spelman
College Project, RB (FGIC)
6.000%, 06/01/09 475 502
Richmond County Georgia Water
& Sewer, Ser A, RB (FGIC)
5.125%, 10/01/17 1,000 951
Rockdale County, School District,
RB, Pre-Refunded 01/01/99
@ 102 (F)
6.400%, 01/01/05 150 157
Savannah, Water & Sewer Revenue,
RB (ETM) (F)
6.450%, 12/01/04 1,000 1,104
State GO, Ser B, Pre-Refunded
07/01/99 @ 102 (F)
6.800%, 07/01/06 460 491
State GO, Ser C
6.500%, 04/01/08 1,000 1,127
State Housing & Financial
Authority, Single Family
Mortgage, Ser B, Sub-ser B-1,
RB (FHA)
5.550%, 12/01/10 325 325
85
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
GEORGIA TAX-EXEMPT BOND FUND--CONCLUDED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
GEORGIA--CONTINUED
State Housing & Financial
Authority, Single Family
Mortgage, Ser B, Sub-ser
B-1, RB (FHA)
5.600%, 12/01/11 $ 450 $ 450
State Municipal Electric Authority,
RB (ETM) (F)
8.000%, 01/01/15 465 587
Vidalia, Water & Sewer Revenue,
RB (ETM) (F)
6.000%, 07/01/07 605 654
Walker County School
District, GO
5.000%, 02/01/03 1,000 1,010
---------
Total Georgia 42,939
---------
Total Municipal Bonds
(Cost $42,637) 42,939
---------
REPURCHASE AGREEMENT (2.6%)
Lehman Brothers
5.02%, dated 05/30/97, matures
06/02/97, repurchase price
$1,233,287 (collateralized
by U.S. Treasury Note, par value
$1,247,488, 5.625%, 08/31/97:
total market value $1,265,810) 1,233 1,233
---------
Total Repurchase Agreement
(Cost $1,233) 1,233
---------
CASH EQUIVALENTS (8.4%)
AIM Management Institutional
Tax-Free Portfolio (C) 2,025 2,025
SEI Tax Exempt Trust Institutional
Tax Free Portfolio (C) 2,007 2,007
---------
Total Cash Equivalents
(Cost $4,032) 4,032
---------
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
Total Investments (100.6% )
(Cost $47,902) $ 48,204
---------
OTHER ASSETS AND LIABILITIES, NET (-0.6%) (299)
---------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 4,084,294
outstanding shares of beneficial
interest 39,434
Fund shares of the Investor Shares
(unlimited authorization --
no par value) based on 360,308
outstanding shares of beneficial
interest 3,511
Fund shares of the Flex Shares
(unlimited authorization --
no par value)
based on 479,124 outstanding
shares of beneficial interest 4,651
Accumulated net realized gain
on investments 7
Net unrealized appreciation
on investments 302
---------
Total Net Assets (100.0%) $ 47,905
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 9.73
=========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 9.74
=========
Maximum Offering Price Per Share --
Investor Class ($9.74 (Divide) 96.25%) $ 10.12
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.73
=========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
86
<PAGE>
================================================================================
INVESTMENT GRADE BOND FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (21.2%)
U.S. Treasury Bonds
7.500%, 11/15/16 $36,100 $ 38,056
8.125%, 08/15/19 81,000 91,127
6.625%, 02/15/27 10,000 9,635
U.S. Treasury Note
6.750%, 04/30/00 4,000 4,039
---------
Total U.S. Treasury Obligations
(Cost $141,586) 142,857
---------
CORPORATE OBLIGATIONS (69.9%)
FINANCE (51.7%)
American General Finance
6.875%, 07/01/99 13,000 13,097
Aristar
6.750%, 05/15/99 23,000 23,115
Associates of North America, MTN
6.650%, 08/30/99 9,500 9,524
Bear Stearns
7.000%, 03/01/07 23,000 22,425
General Motors Acceptance, MTN
6.750%, 11/04/04 21,000 20,422
General Motors Acceptance
7.125%, 05/01/01 23,500 23,676
Homeside Lending, MTN
6.875%, 05/15/00 21,600 21,573
Household Finance, MTN
7.150%, 06/15/00 13,000 13,130
International Lease Finance
6.700%, 04/30/99 23,500 23,618
Merrill Lynch, MTN
6.640%, 04/09/99 19,000 19,071
Morgan Stanley Group
6.875%, 03/01/07 17,000 16,554
RHG Finance
8.875%, 10/01/05 17,100 18,489
Salomon
6.500%, 03/01/00 28,000 27,755
6.750%, 02/15/03 23,000 22,368
Service International
7.375%, 04/15/04 20,500 20,756
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
FINANCE--CONTINUED
Sunamerica
6.200%, 10/31/99 $25,000 $ 24,813
US West Capital Funding
7.300%, 01/15/07 27,500 27,328
---------
Total Finance 347,714
---------
INDUSTRIAL (11.3%)
Ford Capital
9.500%, 06/01/10 15,000 17,306
Lockheed Martin
6.550%, 05/15/99 16,000 16,020
Philip Morris
7.250%, 09/15/01 24,500 24,592
6.800%, 12/01/03 4,000 3,900
7.500%, 04/01/04 14,500 14,573
---------
Total Industrial 76,391
---------
UTILITIES (6.9%)
AT&T Capital, MTN
6.920%, 04/29/99 25,000 25,125
General Electric Capital (C)
6.660%, 05/01/18 21,000 21,052
---------
Total Utilities 46,177
---------
Total Corporate Obligations
(Cost $471,229) 470,282
---------
U.S. GOVERNMENT AGENCY
OBLIGATIONS (4.2%)
FHLMC
8.000%, 06/01/02 8,047 8,244
7.500%, 09/01/03 19,625 19,896
---------
Total U.S. Government Agency
Obligations
(Cost $28,159) 28,140
---------
87
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
INVESTMENT GRADE BOND FUND--CONCLUDED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
REPURCHASE AGREEMENT (0.4%)
Deutsche Bank 5.51%, dated
05/30/97, matures 06/02/97,
repurchase price $2,739,802
(collateralized by U.S.
Treasury Note, par value
$2,777,000, 5.125%, 12/31/98:
market value $2,794,004) $2,739 $ 2,739
---------
Total Repurchase Agreement
(Cost $2,739) 2,739
---------
Total Investments (95.7%)
(Cost $643,713) 644,018
---------
OTHER ASSETS AND LIABILITIES, NET (4.3%) 28,556
---------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 62,361,667
outstanding shares of beneficial
interest 644,729
Fund shares of the Investor Shares
(unlimited authorization --
no par value) based on 3,264,729
outstanding shares of beneficial
interest 34,279
Fund shares of the Flex Shares
(unlimited authorization --
no par value) based on 566,749
outstanding shares of
beneficial interest 5,854
Accumulated net realized loss
on investments (12,593)
Net unrealized appreciation
on investments 305
---------
Total Net Assets (100.0%) $ 672,574
=========
Net Asset Value, Offering and Redemption
Price Per Share-- Trust Shares $ 10.16
=========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 10.16
=========
Maximum Offering Price Per Share --
Investor Class ($10.16 (Divide) 96.25%) $ 10.56
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 10.17
=========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
88
================================================================================
<PAGE>
SHORT-TERM BOND FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (36.0%)
U.S. Treasury Bond
6.125%, 05/15/98 $2,000 $ 2,005
U.S. Treasury Notes
5.875%, 08/15/98 1,750 1,747
4.750%, 09/30/98 1,500 1,476
4.750%, 10/31/98 9,000 8,843
5.500%, 02/28/99 8,750 8,659
5.875%, 11/15/99 3,000 2,971
7.500%, 11/15/01 3,750 3,892
U.S. Treasury STRIPS
0.000%, 08/15/03 5,750 3,851
---------
Total U.S. Treasury Obligations
(Cost $33,597) 33,444
---------
CORPORATE OBLIGATIONS (43.1%)
FINANCE (22.7%)
American General
6.250%, 03/15/03 1,100 1,060
Associates of North America, MTN
5.980%, 12/19/00 1,250 1,220
7.080%, 04/15/03 1,500 1,502
Bankers Trust New York
6.625%, 07/30/99 2,250 2,250
Chrysler Financial
6.440%, 06/23/99 1,000 1,000
Dean Witter Discover, MTN
6.000%, 02/08/01 1,000 966
First Chicago NBD
6.500%, 11/01/01 2,250 2,214
FNMA, MTN
5.760%, 02/26/01 2,100 2,034
Ford Motor Credit
6.250%, 11/08/00 1,500 1,476
General Motors Acceptance
7.125%, 05/01/01 1,750 1,763
Household Finance
9.625%, 07/15/00 1,250 1,349
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
FINANCE--CONTINUED
International Lease Finance, MTN
6.050%, 02/01/00 $2,250 $ 2,216
Norwest Financial
7.200%, 04/01/04 2,000 2,020
---------
Total Finance 21,070
---------
INDUSTRIAL (13.7%)
Dayton Hudson
6.800%, 10/01/01 2,250 2,230
Federal Express
6.250%, 04/15/98 750 752
Philip Morris (D)
9.000%, 05/15/98 1,500 1,540
Philip Morris
7.500%, 01/15/02 1,250 1,264
RJR Nabisco
8.300%, 04/15/99 1,000 1,031
Sears Roebuck Acceptance, MTN
6.820%, 10/17/02 500 496
6.540%, 02/20/03 1,200 1,170
Sherwin-Williams
6.250%, 02/01/00 1,000 991
Tenneco
10.075%, 02/01/01 3,000 3,296
---------
Total Industrial 12,770
---------
UTILITIES (6.7%)
General Electric Capital, Callable
& Putable 4/14/98 @ 100 (C)(D)
6.650%, 04/14/08 2,000 2,006
Indiana & Michigan Power, MTN
6.400%, 03/01/00 2,250 2,230
NYNEX Credit, MTN
6.900%, 06/15/99 2,000 2,015
---------
Total Utilities 6,251
---------
Total Corporate Obligations
(Cost $40,297) 40,091
---------
89
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
SHORT-TERM BOND FUND--CONCLUDED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
U.S. AGENCY MORTGAGE-BACKED
OBLIGATIONS (4.9%)
FHLMC
6.500%, 04/01/98 $ 892 $ 884
8.000%, 01/01/00 894 910
5.375%, 04/13/00 1,000 989
FNMA
8.500%, 11/01/01 1,758 1,801
---------
Total U.S. Agency Mortgage-Backed
Obligations
(Cost $4,534) 4,584
---------
ASSET-BACKED SECURITIES (9.4%)
Chase Manhattan Auto Grantor
Trust, Ser 1996-B, Cl A
6.610%, 09/15/02 1,947 1,955
Metris Master Trust,
Ser 1997-1, Cl A
6.870%, 11/20/05 2,750 2,767
Olympic Automobile Receivables
Trust, Ser 1996-D, Cl A3
5.950%, 06/15/01 2,500 2,477
Union Pacific Equipment Trust,
Ser 96-A
7.060%, 05/15/03 1,500 1,506
---------
Total Asset-Backed Securities
(Cost $8,697) 8,705
---------
CASH EQUIVALENTS (2.8%)
SEI Daily Income Trust Prime
Obligation Portfolio 2,583 2,583
---------
Total Cash Equivalents
(Cost $2,583) 2,583
---------
Total Investments (96.2%)
(Cost $89,708) 89,407
---------
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (3.8%) $ 3,549
---------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization -- no
par value) based on 9,063,741
outstanding shares of
beneficial interest 90,146
Fund shares of the Investor Shares
(unlimited authorization -- no par
value) based on 220,117 outstanding
shares of beneficial interest 2,202
Fund shares of the Flex Shares (unlimited
authorization -- no par value) based
on 108,300 outstanding shares of
beneficial interest 1,087
Undistributed net investment income 141
Accumulated net realized loss
on investments (319)
Net unrealized depreciation
on investments (301)
---------
Total Net Assets (100.0%) $ 92,956
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 9.90
=========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 9.91
=========
Maximum Offering Price Per Share --
Investor Class ($9.91 (Divide) 98.00%) $ 10.11
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.91
=========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
90
<PAGE>
SHORT-TERM U.S. TREASURY SECURITIES FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (97.3%)
U.S. Treasury Bonds
6.125%, 05/15/98 $2,250 $ 2,255
6.000%, 08/15/99 2,500 2,487
U.S. Treasury Notes
5.125%, 06/30/98 2,250 2,233
5.875%, 08/15/98 3,400 3,394
5.500%, 11/15/98 1,600 1,588
8.875%, 02/15/99 4,200 4,382
6.375%, 05/15/99 1,900 1,905
6.875%, 07/31/99 4,250 4,303
5.875%, 11/15/99 2,000 1,980
5.875%, 02/15/00 1,000 988
6.875%, 03/31/00 750 760
---------
Total U.S. Treasury Obligations
(Cost $26,305) 26,275
---------
CASH EQUIVALENT (1.6%)
SEI Daily Income Trust
Treasury II Portfolio 437 437
---------
Total Cash Equivalent
(Cost $437) 437
---------
Total Investments (98.9%)
(Cost $26,742) 26,712
---------
OTHER ASSETS AND LIABILITIES, NET (1.1%) 288
---------
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization --
no par value) based on 2,225,584
outstanding shares of beneficial
interest $22,198
Fund shares of the Investor Shares
(unlimited authorization --
no par value) based on 396,977
outstanding shares of beneficial
interest 3,986
Fund shares of the Flex Shares
(unlimited authorization --
no par value) based on 110,713
outstanding shares of
beneficial interest 1,103
Accumulated net realized loss
on investments (257)
Net unrealized depreciation
on investments (30)
---------
Total Net Assets (100.0%) $ 27,000
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 9.88
=========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 9.88
=========
Maximum Offering Price Per Share --
Investor Class ($9.88 (Divide) 99.00%) $ 9.98
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.85
=========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
91
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
LIMITED-TERM FEDERAL MORTGAGE SECURITIES FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (33.7%)
U.S. Treasury Notes
8.875%, 02/15/99 $10,300 $ 10,747
9.125%, 05/15/99 11,200 11,789
8.000%, 08/15/99 6,000 6,210
7.500%, 10/31/99 8,800 9,030
8.500%, 11/15/00 5,000 5,317
---------
Total U.S. Treasury Obligations
(Cost $43,159) 43,093
---------
U.S. GOVERNMENT AGENCY
OBLIGATIONS (64.0%)
FHLMC
6.000%, 07/01/00 4,568 4,415
8.000%, 06/01/02 1,149 1,178
7.000%, 10/01/02 4,532 4,543
8.000%, 12/01/02 2,855 2,886
7.000%, 03/01/04 14,946 14,947
FHLMC REMIC, Ser 1910-Ac
6.500%, 10/15/15 10,000 9,946
FHLMC REMIC, Ser 1637-E
5.750%, 02/15/19 2,699 2,645
FHLMC REMIC, Ser 1614-H
6.000%, 06/15/20 4,550 4,411
FNMA
7.500%, 07/01/03 8,811 8,924
7.000%, 03/01/04 14,834 14,830
8.500%, 04/01/17 1,106 1,157
FNMA REMIC, Ser G96-1PC
7.000%, 08/17/12 4,921 4,954
FNMA REMIC, Ser 1992-134G
6.000%, 11/25/18 5,586 5,460
GNMA
9.000%, 11/15/17 1,412 1,513
---------
Total U.S. Government Agency
Obligations
(Cost $81,888) 81,809
---------
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
REPURCHASE AGREEMENT (1.9%)
J.P. Morgan
5.50%, dated 05/30/97,
matures 06/02/97, repurchase
price $2,376,897
(collateralized by
various FNMA obligations,
total par value $3,182,000,
7.500%-8.115%, 05/25/23-05/01/27;
total market value $2,425,338) $2,376 $ 2,376
---------
Total Repurchase Agreement
(Cost $2,376) 2,376
---------
Total Investments (99.6%)
(Cost $127,423) 127,278
---------
OTHER ASSETS AND LIABILITIES, NET (0.4%) 460
---------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization -- no
par value) based on 12,371,227
outstanding shares of
beneficial interest 124,063
Fund shares of the Investor Shares
(unlimited authorization -- no
par value) based on 242,520
outstanding shares of
beneficial interest 2,441
Fund shares of the Flex Shares
(unlimited authorization -- no
par value) based on 140,719
outstanding shares of
beneficial interest 1,424
Distributions in excess of net
investment income (2)
Accumulated net realized loss
on investments (43)
Net unrealized depreciation
on investments (145)
---------
Total Net Assets (100.0%) $ 127,738
=========
92
<PAGE>
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 10.02
=========
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 10.00
=========
Maximum Offering Price Per Share --
Investor Class ($10.00 (Divide) 97.50%) $ 10.26
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 10.02
=========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
93
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
U.S. GOVERNMENT SECURITIES FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (28.0%)
U.S. Treasury Bonds
7.250%, 05/15/16 $1,000 $ 1,029
6.875%, 08/15/25 1,000 988
6.750%, 08/15/26 550 535
6.500%, 11/15/26 565 533
U.S. Treasury Notes
7.750%, 11/30/99 200 207
8.500%, 11/15/00 1,000 1,063
8.000%, 05/15/01 200 210
7.500%, 11/15/01 200 208
7.500%, 05/15/02 750 781
7.875%, 11/15/04 275 295
7.500%, 02/15/05 500 525
6.500%, 10/15/06 50 49
7.625%, 02/15/25 400 431
---------
Total U.S. Treasury Obligations
(Cost $6,994) 6,854
---------
U.S. AGENCY MORTGAGE-BACKED
OBLIGATIONS (66.1%)
FHLMC
6.000%, 02/01/01 112 108
7.000%, 01/01/09 127 126
7.000%, 04/01/09 611 608
7.000%, 08/01/10 888 883
7.000%, 05/01/12 990 984
FNMA
7.500%, 06/01/11 947 958
7.000%, 09/17/11 1,430 1,421
7.000%, 10/25/16 951 926
7.500%, 04/01/27 987 983
FNMA REMIC, Ser 1997-6, Cl H
7.000%, 08/18/08 1,058 1,037
FNMA REMIC, Ser G93-40, Cl VC
6.500%, 08/25/10 261 248
FNMA REMIC, Ser 1997-34, Cl VC
7.500%, 05/01/12 1,000 1,009
FNMA REMIC, Ser 1996-9, Cl H
6.500%, 11/25/13 1,337 1,265
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
FNMA REMIC, Ser 993-156, Cl B
6.500%, 04/25/18 $ 100 $ 95
FNMA REMIC, Ser 1990-143, Cl J
8.750%, 12/25/20 140 146
GNMA
7.500%, 10/20/09 72 73
8.250%, 01/15/12 99 102
10.000%, 06/15/19 4 5
7.000%, 11/15/22 466 453
8.000%, 02/15/23 37 38
8.500%, 03/15/23 81 84
7.500%, 04/15/23 132 132
7.500%, 09/15/23 875 872
7.000%, 01/15/24 161 157
7.500%, 04/15/24 861 857
7.000%, 06/15/24 902 877
8.000%, 08/15/24 83 85
8.000%, 09/15/24 27 28
8.000%, 10/15/24 35 36
8.000%, 11/15/24 37 39
8.500%, 12/15/24 73 77
8.500%, 02/15/25 36 37
7.000%, 12/15/25 489 476
GNMA REMIC, Ser 1995-6A, Cl E
7.500%, 05/20/23 1,000 990
---------
Total U.S. Agency Mortgage-Backed
Obligations
(Cost $16,289) 16,215
---------
CASH EQUIVALENTS (5.8%)
SEI Daily Income Trust
Government II Portfolio (C) 229 229
SEI Daily Income Trust
Treasury II Portfolio (C) 1,188 1,188
---------
Total Cash Equivalents
(Cost $1,417) 1,417
---------
Total Investments (99.9%)
(Cost $24,700) 24,486
---------
94
<PAGE>
================================================================================
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (0.1%) $ 29
---------
NET ASSETS:
Fund shares of the Trust
Shares (unlimited authorization
-- no par value) based on 1,943,402
outstanding shares of beneficial
interest 19,658
Fund shares of the Investor Shares
(unlimited authorization -- no par
value) based on 223,920 outstanding
shares of beneficial interest 2,266
Fund shares of the Flex Shares (unlimited
authorization -- no par value) based
on 279,601 outstanding shares of
beneficial interest 2,866
Accumulated net realized loss
on investments (61)
Net unrealized depreciation
on investments (214)
---------
Total Net Assets (100.0%) $ 24,515
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 10.02
=========
- ------------------------------------------------------------
- ------------------------------------------------------------
Net Asset Value and Redemption Price
Per Share -- Investor Shares $ 10.02
=========
Maximum Offering Price Per Share --
Investor Class ($10.02 (Divide) 96.25%) $ 10.41
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 10.02
=========
(1) The Flex Shares have a contingent sales charge. For a description of a
possible sales charge, see notes to the financial statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
95
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
PRIME QUALITY MONEY MARKET FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
COMMERCIAL PAPER (45.9%)
ABN-Amro Finance
5.350%, 06/05/97 $ 1,500 $ 1,499
Banc One Funding
5.600%, 08/04/97 10,211 10,109
Bank of Montreal
5.520%, 07/01/97 20,000 19,908
Bankers Trust
5.500%, 11/17/97 1,000 974
BAT Capital
5.530%, 06/24/97 5,000 4,982
5.700%, 07/14/97 10,450 10,379
5.580%, 07/15/97 20,127 19,990
Cargill Financial
5.550%, 06/16/97 20,000 19,954
Caterpillar Financial Services
5.600%, 09/11/97 16,000 15,746
Central Illinois Public Services
5.500%, 06/05/97 5,700 5,697
Commerzbank
5.350%, 06/10/97 9,135 9,123
Deutsche Bank Finance
5.350%, 06/06/97 30,000 29,978
Dominion Semiconductor
5.650%, 06/04/97 18,497 18,488
5.550%, 06/23/97 5,000 4,983
5.550%, 06/24/97 15,000 14,947
Dresser Industries
5.550%, 06/30/97 20,500 20,408
Ford Motor Credit
5.650%, 07/03/97 1,800 1,791
Ford Motor Credit Puerto Rico
5.620%, 07/08/97 2,000 1,988
General Electric Capital
5.520%, 06/24/97 10,000 9,965
5.380%, 07/09/97 15,000 14,915
Golden Peanut
5.400%, 07/15/97 3,750 3,725
GTE Funding
5.510%, 06/09/97 16,000 15,980
Hertz
5.620%, 07/25/97 25,000 24,789
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- -------------------------------------------------------------
COMMERCIAL PAPER--CONTINUED
International Business
Machines Credit
5.550%, 06/19/97 $35,000 $34,908
J.C. Penny Funding
5.350%, 06/09/97 21,000 20,975
Mobil Australia Finance
5.580%, 06/30/97 1,500 1,493
National Australia Funding
5.550%, 06/02/97 35,000 34,995
5.430%, 08/13/97 4,500 4,450
National City Credit
5.650%, 07/28/97 8,000 7,928
5.665%, 08/21/97 15,000 14,809
New England Power
5.520%, 06/06/97 3,500 3,497
Paccar Financial
5.350%, 06/04/97 1,500 1,499
Pactel Capital Resources
5.510%, 06/23/97 26,000 25,912
Panasonic
5.350%, 06/09/97 13,000 12,985
RTZ America
5.550%, 06/25/97 10,000 9,963
5.650%, 11/17/97 12,475 12,144
Sherwin Williams
5.620%, 07/21/97 4,000 3,969
5.640%, 08/04/97 8,325 8,242
5.640%, 08/05/97 4,800 4,751
5.640%, 08/11/97 7,500 7,417
5.680%, 08/22/97 3,000 2,961
Society Generale North America
5.500%, 09/10/97 5,000 4,923
Sony Capital
5.500%, 06/05/97 6,690 6,686
Southern New England
Telcommunications
5.580%, 06/11/97 2,000 1,997
Transamerica Finance
5.520%, 06/04/97 9,700 9,696
5.540%, 06/19/97 4,955 4,941
96
<PAGE>
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
COMMERCIAL PAPER--CONTINUED
U.S. Borax
5.400%, 06/09/97 $ 3,700 $ 3,696
5.370%, 06/20/97 40,000 39,887
5.650%, 07/16/97 6,000 5,958
5.670%, 07/28/97 5,000 4,955
Virginia Electric & Power
5.650%, 07/16/97 8,000 7,943
Waste Management Technologies
5.580%, 06/24/97 25,000 24,911
5.650%, 06/27/97 5,000 4,980
5.720%, 08/12/97 14,700 14,532
---------
Total Commercial Paper
(Cost $628,321) 628,321
---------
CORPORATE OBLIGATIONS (15.5%)
FINANCE (10.0%)
American General Finance
7.700%, 11/15/97 5,000 5,034
8.250%, 01/15/98 1,250 1,269
American General, MTN
9.750%, 10/15/97 2,650 2,690
9.950%, 10/29/97 2,100 2,136
Associates of North America
5.875%, 08/15/97 750 750
6.625%, 11/15/97 16,755 16,811
8.125%, 01/15/98 1,000 1,014
Bank America, MTN
6.875%, 11/20/97 2,000 2,009
BAT Capital, MTN
6.470%, 09/15/97 10,000 10,022
Beneficial
9.125%, 02/15/98 1,875 1,914
Caterpillar Finance (C)
5.619%, 07/28/97 1,000 1,000
Corestates Capital (C)
5.610%, 09/02/97 30,000 30,000
Dean Witter Discover
6.000%, 03/01/98 19,865 19,873
First Chicago, MTN
11.150%, 10/31/97 5,000 5,102
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
FINANCE--CONTINUED
Ford Motor Credit, MTN
6.450%, 02/05/98 $5,000 $ 5,018
Household Finance, MTN (C)
5.460%, 08/04/97 5,000 5,000
International Lease Finance, MTN
7.500%, 01/15/98 3,000 3,030
5.750%, 02/02/98 5,000 4,997
5.740%, 02/03/98 5,000 4,997
International Lease Finance
5.840%, 06/09/97 5,000 5,000
5.625%, 03/01/98 4,800 4,791
NationsBank
6.625%, 01/15/98 1,000 1,004
Texaco Capital
8.650%, 01/30/98 2,000 2,035
Toyota Motor Credit, MTN
7.750%, 12/19/97 1,500 1,514
---------
Total Finance 137,010
---------
INDUSTRIAL (2.8%)
Ford Capital
9.750%, 06/05/97 2,150 2,151
9.375%, 01/01/98 6,351 6,476
Philip Morris
8.750%, 06/15/97 2,000 2,002
9.250%, 12/01/97 15,180 15,414
6.375%, 01/15/98 1,000 1,003
Rockwell International
7.625%, 02/17/98 1,000 1,010
Smithkline Beecham, MTN
6.200%, 01/20/98 5,250 5,261
Walt Disney
8.000%, 12/19/97 3,595 3,634
Waste Management Technologies
8.125%, 02/01/98 2,000 2,029
---------
Total Industrial 38,980
---------
UTILITIES (2.7%)
Hydro-Quebec, MTN
7.120%, 12/19/97 2,500 2,517
Northern State Power
5.875%, 10/01/97 12,000 12,004
97
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
PRIME QUALITY MONEY MARKET FUND--CONCLUDED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
UTILITIES--CONTINUED
Pacific Gas & Electric, MTN
6.900%, 06/23/97 $ 4,500 $ 4,503
Pacific
5.880%, 10/15/97 5,000 4,997
Pacificorp, MTN
8.850%, 06/20/97 10,000 10,014
Southern California Edison
5.875%, 02/01/98 2,500 2,499
---------
Total Utilities 36,534
---------
Total Corporate Obligations
(Cost $212,524) 212,524
---------
BANK NOTES (7.6%)
Boatmans National Bank (C)
5.690%, 06/17/97 25,000 25,000
FCC National Bank (C)
5.640%, 05/08/98 15,000 14,993
FCC National Bank
5.880%, 11/05/97 25,000 25,003
Fifth Third Bank
5.430%, 06/12/97 10,000 10,000
Morgan Guaranty Trust
5.950%, 06/06/97 19,300 19,301
PNC Bank (C)
5.628%, 06/06/97 10,000 10,000
---------
Total Bank Notes
(Cost $104,297) 104,297
---------
U.S. GOVERNMENT AGENCY
OBLIGATIONS (6.6%)
FNMA (C)
5.350%, 09/29/97 25,000 24,996
FNMA, MTN (C)
5.360%, 11/14/97 40,000 39,991
FNMA, MTN Ser B (C)
5.250%, 09/03/97 20,000 19,997
SLMA
Callable 08/18/97 @100
5.370%, 02/08/99 5,000 4,987
---------
Total U.S. Government Agency Obligations
(Cost $89,971) 89,971
---------
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
ASSET-BACKED SECURITIES (5.7%)
Americredit Auto Receivables
Trust, Ser 1997-A, Cl A1
5.515%, 04/06/98 $20,452 $ 20,453
Americredit Auto Receivables
Trust, Ser 1996-D, Cl A1
5.425%, 12/12/97 11,936 11,939
Americredit Auto Receivables
Trust, Ser 1997-B, Cl A
5.790%, 06/12/98 30,000 30,000
Chase Manhattan Auto Owner
Trust, Ser 1997-A, Cl A1
5.545%, 04/10/98 6,789 6,789
Ford Credit Auto Owner Trust,
Ser 1996-B, Cl A1
5.514%, 10/15/97 1,351 1,352
Navistar Financial Owner Trust,
Ser 1996-B, Cl A1
5.490%, 11/20/97 910 911
Olympic Automobile Recievable
Trust, Ser 1996-D
5.430%, 12/15/97 121 122
WFS Financial Owner Trust,
Ser 1996-D, Cl A1
5.500%, 01/16/98 6,287 6,287
---------
Total Asset-Backed Securities
(Cost $77,853) 77,853
---------
CERTIFICATES OF DEPOSIT (13.1%)
Bank of America, Toronto
5.730%, 07/31/97 38,000 38,000
Bankers Trust New York (C)
5.630%, 10/16/97 25,000 24,995
Bankers Trust, Toronto
5.690%, 08/21/97 21,000 21,000
CIBC
5.970%, 03/19/98 5,000 4,999
Societe Generale
5.690%, 08/22/97 40,000 40,000
Swiss Bank
5.530%, 06/30/97 30,000 30,000
Swiss Bank (C)
6.149%, 06/19/97 10,000 10,000
98
<PAGE>
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
CERTIFICATES OF DEPOSIT--CONTINUED
Swiss Bank
5.490%, 07/09/97 $10,000 $ 10,000
---------
Total Certificates Of Deposit
(Cost $178,994) 178,994
---------
U.S. TREASURY OBLIGATIONS (1.5%)
U.S. Treasury Notes
7.250%, 02/15/98 20,000 20,200
---------
Total U.S. Treasury Obligations
(Cost $20,200) 20,200
---------
REPURCHASE AGREEMENTS (6.6%)
Deutsche Bank
5.55%, dated 05/30/97, matures
06/02/97, repurchase price
$10,007,654 (collateralized
by FHMLC obligation,
par value $10,337,964,
6.092%, 10/01/32:
market value $10,203,089) 10,003 10,003
Salomon Brothers
5.55%, dated 05/30/97, matures
06/02/97, repurchase price
$10,007,654 (collateralized
by various FHLMC obligations,
total par value $17,813,437,
5.500%-9.000, 08/01/00-06/01/26;
and various FNMA obligations,
total par value $18,383,048,
6.000%-9.000%, 12/01/01-05/01/27:
total market value $10,246,600) 10,003 10,003
Swiss Bank
5.55%, dated 05/30/97, matures
06/02/97, repurchase price
$13,337,430 (collateralized by
FNMA obligation, par value
$17,012,000, 6.071%, 04/01/34:
market value $13,664,762) 13,331 13,331
REPURCHASE AGREEMENTS--CONTINUED
Union Bank of Switzerland
5.55%, dated 05/30/97, matures
06/02/97, repurchase price
$59,196,682 (collateralized
by various FHLMC obligations,
total par value $61,959,824,
0.000%-8.500%, 12/01/07-
12/01/26; and FNMA obligation,
par value $3,000,000, 6.400%
02/25/03: total market
value $60,374,115) $59,169 $ 59,169
----------
Total Repurchase Agreements
(Cost $92,506) 92,506
----------
Total Investments (102.5%)
(Cost $1,404,666) 1,404,666
----------
OTHER ASSETS AND LIABILITIES, NET (-2.5%) (34,567)
----------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization -- no
par value) based on 1,086,903,240
outstanding shares of beneficial
interest 1,086,903
Fund shares of the Investor Shares
(unlimited authorization -- no
par value) based on 283,601,522
outstanding shares of beneficial
interest 283,602
Accumulated net realized loss
on investments (406)
----------
Total Net Assets (100.0%) $1,370,099
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 1.00
==========
Net Asset Value, Offering Price and
Redemption Price Per Share --
Investor Shares $ 1.00
==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
99
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
U.S. GOVERNMENT SECURITIES MONEY MARKET FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
U.S. GOVERNMENT AGENCY OBLIGATIONS (25.9%)
U.S. Treasury Notes
5.750%, 10/31/97 $30,000 $ 30,025
7.375%, 11/15/97 55,000 55,405
5.000%, 01/31/98 10,000 9,950
7.250%, 02/15/98 10,000 10,100
---------
Total U.S. Government Agency Obligations
(Cost $105,480) 105,480
---------
REPURCHASE AGREEMENTS (73.2%)
Barclays
5.51%, dated 05/30/97, matures
06/02/97, repurchase price
$20,009,183 (collateralized
by FHLMC obligation, par value
$8,960,000, 5.890%, 03/26/98;
FNMA obligation, par value
$4,315,000, 6.200%, 06/06/00;
SLMA obligation, par value
$7,000,000, 5.880%, 02/06/01:
total market value $20,401,553) 20,000 20,000
Deutsche Bank
5.51%, dated 05/30/97, matures
06/02/97, repurchase price
$20,040,319 (collateralized by
various U.S. Treasury obligations,
total par value $19,827,000,
5.750%-8.125%, 12/31/98- 05/15/21:
total market value $20,432,188) 20,031 20,031
Merrill Lynch
5.51%, dated 05/30/97, matures
06/02/97, repurchase price
$98,954,749 (collateralized
by various GNMA obligations,
total par value $328,491,658,
7.000%-11.000%, 02/15/02-11/15/23:
total market value $100,889,610) 98,909 98,909
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
Morgan Stanley
5.51%, dated 05/30/97,
matures 06/02/97, repurchase
price $99,259,385 (collateralized
by various GNMA obligations,
total par value $709,897,000,
0.698%-8.000%, 01/01/00-06/15/26:
total market value $104,959,999) $99,214 $ 99,214
Salomon Brothers
5.51%, dated 05/30/97, matures
06/02/97, repurchase price
$20,093,747 (collateralized
by various U.S. Government Notes,
total par value $20,034,000,
6.875%-8.875%, 10/15/97-03/31/00:
total market value $20,489,252) 20,085 20,085
Swiss Bank
5.51%, dated 05/30/97, matures
06/02/97, repurchase price
$20,012,200 (collateralized by
various U.S. Treasury obligations,
total par value $19,625,000,
5.875%-7.250%, 06/30/00-
08/15/22: total market
value $20,426,087) 20,003 20,003
Union Bank of Switzerland
5.51%, dated 05/30/97, matures
06/02/97, repurchase price
$20,015,030 (collateralized
by various FHLMC obligations,
total par value $20,185,000,
5.980%-7.554%, 02/26/04-07/31/06:
total market value $20,410,150) 20,006 20,006
---------
Total Repurchase Agreements
(Cost $298,248) 298,248
---------
Total Investments (99.1%)
(Cost $403,728) 403,728
---------
OTHER ASSETS AND LIABILITIES, NET (0.9%) 3,800
---------
100
<PAGE>
================================================================================
- ------------------------------------------------------------
VALUE (000)
- ------------------------------------------------------------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization -- no
par value) based on 344,391,123
outstanding shares of beneficial
interest $ 344,391
Fund shares of the Investor Shares
(unlimited authorization -- no
par value) based on 63,197,343
outstanding shares of beneficial
interest 63,197
Accumulated net realized loss
on investments (60)
---------
Total Net Assets (100.0%) $ 407,528
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 1.00
=========
Net Asset Value, Offering Price and
Redemption Price Per Share --
Investor Shares $ 1.00
=========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
101
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
TAX-EXEMPT MONEY MARKET FUND
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
MUNICIPAL BONDS (98.5%)
ALABAMA (1.1%)
McIntosh, Industrial Development
Board, Ciba-Geigy Project,
Ser A, RB, VRDN
(C)(D)(E)
3.850%, 06/04/97 $3,500 $ 3,500
Special Care Facilities,
Montgomery Hospital
Revenue, RB, VRDN
(FGIC) (C)(D)
3.900%, 06/04/97 1,400 1,400
---------
Total Alabama 4,900
---------
ALASKA (0.2%)
Anchorage, GO, Ser A, (MBIA)
5.000%, 02/01/98 1,045 1,054
---------
ARIZONA (1.7%)
Maricopa County, Pollution Control
Authority, Ser A, RB, VRDN
(C)(D)(E)
3.850%, 06/04/97 4,000 4,000
Pima County, Industrial
Development Authority,
Tuscon Electric Project,
Ser A, RB, VRDN (C)(D)(E)
3.900%, 06/04/97 2,600 2,600
Scottsdale, GO
7.500%, 07/01/97 840 842
---------
Total Arizona 7,442
---------
ARKANSAS (0.2%)
State, Industrial Development
Financial Authority, Ser A, RB,
VRDN, AMT (C)(D)(E)
4.000%, 06/04/97 1,000 1,000
---------
CALIFORNIA (1.7%)
Contra Costa County, Multi-Family
Mortgage, Delta Square Project,
Ser A, RB, VRDN (C)(D)(E)
3.850%, 06/05/97 4,200 4,200
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
CALIFORNIA--CONTINUED
Higher Education Loan Authority,
Ser A, VRDN, callable 06/01/98
@ 100 (C)(D)(E)
3.950%, 06/01/01 $1,900 $ 1,900
State, Higher Education
Loan Authority, Student Loan,
Ser 95E-5, RB, VRDN,
AMT (C)(D)(E)
3.950%, 06/04/97 1,200 1,200
---------
Total California 7,300
---------
COLORADO (1.9%)
North Glen, Castle Garden
Retirement Center,
VRDN (C)(D)(E)
3.850%, 06/05/97 1,200 1,200
State, TRAN, Ser A, RB
4.500%, 06/27/97 7,000 7,003
---------
Total Colorado 8,203
---------
DELAWARE (0.4%)
State Educational Development
Authority, VRDN (C)(D)(E)
4.225%, 06/05/97 1,875 1,875
---------
FLORIDA (10.3%)
Citrus Park, RB, VRDN (C)(D)(E)
3.900%, 06/04/97 1,500 1,500
Dade County, Water & Sewer
System, Ser 94, RB, VRDN
(FGIC) (C)(E)
3.850%, 06/04/97 8,000 8,000
Jacksonville, TECP
3.400%, 06/09/97 1,000 1,000
3.500%, 06/26/97 10,000 10,000
Jacksonville, Pollution Control
Revenue, TECP
3.500%, 06/12/97 5,000 5,000
Local Government, TECP
3.450%, 06/16/97 4,000 4,000
3.550%, 06/19/97 5,500 5,500
Pinellas County, TECP
3.750%, 07/01/97 3,600 3,600
102
<PAGE>
================================================================================
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
FLORIDA--CONTINUED
State Board of Education,
Capital Outlay, GO
6.500%, 06/01/97 $4,575 $ 4,575
Sunshine State Government,Finance
Commission Revenue, TECP
3.500%, 06/12/97 1,400 1,400
---------
Total Florida 44,575
---------
GEORGIA (5.0%)
Barrow County School District,
Ser 97, GO
4.000%, 02/01/98 1,000 1,000
Burke County, Development
Authority Pollution Control,
RB (AMBAC)
3.600%, 12/01/97 1,500 1,500
Burke County, Oglethorpe Power,
Ser A, VRDN (FGIC) (C)(D)
3.850%, 06/04/97 4,400 4,400
Fulton County, Development
Authority, American Red Cross
Project, RB, VRDN (C)(D)(E)
3.950%, 06/05/97 1,500 1,500
Gordon County, Development
Authority, Sara Lee Project,
RB, VRDN (C)(D)
3.950%, 06/05/97 1,400 1,400
Lafayette, Industrial Development
Authority, Blue-Bird Project,
Ser 1991, VRDN (C)(D)(E)
3.950%, 06/05/97 1,000 1,000
Marietta Housing Finance Authority,
Franklin Walk Apartments Project,
VRDN (C)
3.975%, 06/05/97 1,600 1,600
Monroe County, Industrial
Development Authority, Forsyth
Inns Project, RB, VRDN (C)(D)(E)
3.950%, 06/04/97 2,525 2,525
Municipal Electric Authority,
VRDN (FGIC) (C)(D)
4.100%, 06/05/97 3,000 3,000
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
GEORGIA--CONTINUED
Private College Facilities Authority,
Emory University, RB, VRDN Optional
Put 12/01/97 @ 100,
(C)(D)(E)
3.700%, 12/01/04 $3,465 $ 3,465
---------
Total Georgia 21,390
---------
IDAHO (1.6%)
Nez Pierce County, Pollution
Control Board, Potlatch Corp.
Project, RB, VRDN (C)(D)(E)
3.900%, 06/05/97 3,000 3,000
Idaho State, TAN, GO
4.500%, 06/30/97 4,000 4,002
---------
Total Idaho 7,002
---------
ILLINOIS (4.7%)
Bloomington, Airport Authority,
VRDN (C)(D)(E)
3.950%, 06/04/97 1,500 1,500
Chicago, Tender Notes, GO (E)
3.650%, 02/05/98 2,000 2,000
DuPage County, First Preservation
District, GO, Pre-Refunded
11/01/97 @ 102 (F)
8.100%, 11/01/06 1,200 1,245
Educational Facilities, Chicago
Children's Museum, RB,
VRDN (C)(D)(E)
3.900%, 06/04/97 1,600 1,600
Health Facilities Authority,
Advocate Healthcare Network,
Ser B, RB, VRDN (C)(D)
3.950%, 06/04/97 3,000 3,000
Illinois Health Facility Authority,
RB, VRDN (C)(D)
4.000%, 06/05/97 3,000 3,000
Savanna, Industrial Development
Authority, Metform Project,
Ser B, RB, VRDN (C)(D)(E)
4.050%, 06/04/97 1,400 1,400
103
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
TAX-EXEMPT MONEY MARKET FUND--CONTINUED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
ILLINOIS--CONTINUED
Savanna, Industrial Development
Authority, Ser A, RB,
VRDN (C)(D)(E)
4.050%, 06/04/97 $ 500 $ 500
State, Health Facilities
Authority, Streeterville Project,
RB, VRDN (C)(D)(E)
3.900%, 06/04/97 2,000 2,000
State, Health Facilities
Authority, University of Chicago
Hospital Project, Ser C,
VRDN (MBIA) (C)(D)
3.850%, 06/04/97 4,000 4,000
---------
Total Illinois 20,245
---------
INDIANA (5.6%)
Allen County, Industrial Economic
Development, Mattel Power Wheels
Project, RB, VRDN, AMT (C)(D)(E)
4.200%, 06/04/97 1,500 1,500
Fort Wayne, Industrial Economic
Development Authority, ND Tech
Project, RB, VRDN, AMT (C)(D)(E)
4.050%, 06/04/97 1,000 1,000
Hammond Industrial Local Public,
Adv. Fdg Project, Ser A-2, GO
4.200%, 01/08/98 6,000 6,017
Health Facility Authority,
Clarian Health Partners,
Ser B, RB, VRDN, (C)(D)(E)
3.900%, 06/04/97 2,000 2,000
Indianapolis, Industrial Economic
Development Authority, Allied
Signal Project, RB, VRDN
(C)(D)(E)
4.050%, 06/04/97 3,500 3,500
Indianapolis, Industrial
Multi-Family Housing
Authority, Crossing Partners
Project, RB, VRDN, AMT
(C)(D)(E)
4.150%, 06/04/97 8,700 8,700
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
INDIANA--CONTINUED
Rockport County, Pollution
Control Authority, Aep Generating
Project, Ser B, RB, VRDN
(AMBAC) (C)(D)
4.150%, 06/02/97 $1,600 $ 1,600
---------
Total Indiana 24,317
---------
IOWA (0.6%)
West Des Moines, Commercial
Development Authority,
Greyhound Lines Project,
VRDN (C)(D)(E)
3.800%, 06/04/97 2,500 2,500
---------
KENTUCKY (0.9%)
Jefferson County,
Industrial Building Fisher-
Klosterman Project, RB,
VRDN (C)(D)(E)
4.050%, 06/05/97 2,500 2,500
State, Economic Development
Financial Authority Hospital
Facilities - Baptist Healthcare,
RB, VRDN (C)(D)(E)
3.850%, 06/05/97 1,400 1,400
---------
Total Kentucky 3,900
---------
LOUISIANA (2.4%)
Lake Charles, Harbor & Terminal
District Authority, Reynolds
Metals Project, VRDN (C)(D)(E)
3.900%, 06/04/97 3,000 3,000
Plaqeumines, Port Facilities,
International Marine Terminal
Project, Ser B, RB, Optional
Put 03/15/98 @ 100 (D)(E)
3.750%, 03/15/06 1,000 1,000
Louisiana Port Authority,
Occidental Petroleum
Project, RB,
VRDN (C)(D)(E)
3.800%, 06/04/97 4,500 4,500
104
<PAGE>
- -------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- -------------------------------------------------------------
LOUISIANA--CONTINUED
State, Offshore Terminal Authority
Deepwater Port, Loop Inc - First
Stage Project, Ser A, RB,
VRDN, (C)(E)
3.850%, 06/04/97 $2,000 $ 2,000
---------
Total Louisiana 10,500
---------
MAINE (1.0%)
State, TAN, GO
4.500%, 06/27/97 4,500 4,502
---------
MARYLAND (2.7%)
Baltimore County, Allied Signal
Project, RB, VRDN (C)(D)(E)
4.000%, 06/04/97 1,000 1,000
Baltimore, Industrial Development
Authority, Days Inn of America
Project, RB Callable
12/01/97 @ 100 (F)
12.625%, 12/01/04 2,000 2,087
Montgomery County, Housing
Opportunities Multi-Family
Commission, Ser A, RB
3.700%, 11/13/97 3,650 3,650
State, Health & Higher
Education Authority, Pooled Loan
Program, Ser B, VRDN (C)(D)(E)
3.850%, 06/04/97 5,000 5,000
---------
Total Maryland 11,737
---------
MICHIGAN (3.4%)
Michigan City, Industrial Economic
Development, Performance
Packaging, RB, VRDN (C)(D)(E)
4.150%, 06/04/97 1,000 1,000
Midland County, Economic
Development, Dow Chemical
Project, Ser B, RB, VRDN, (C)(D)
4.000%, 06/02/97 5,575 5,575
Oakland County, Economic
Development, VRDN (C)(D)(E)
4.100%, 06/04/97 1,000 1,000
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
MICHIGAN--CONTINUED
State, Housing Development
Authority, WoodLand Meadows,
RB, VRDN, AMT (C)(D)(E)(F)
4.050%, 06/04/97 $1,000 $ 1,000
State, Housing Development
Authority, Harbortown,
VRDN (C)(D)(E)
3.975%, 06/05/97 3,000 3,000
State, Strategic Industrial
Development Authority,
Norcor Manufacturing Project,
RB, VRDN (C)(D)(E)
4.000%, 06/03/97 3,000 3,000
---------
Total Michigan 14,575
---------
MISSISSIPPI (0.8%)
Jackson County, Chevron USA
Project, Ser 93, RB, VRDN (C)(D)
4.050%, 06/02/97 3,500 3,500
---------
MISSOURI (0.7%)
Environmental Improvement and
Energy Resource, Utilicorp United
Project, RB, VRDN (C)(D)(E)
4.050%, 06/04/97 700 700
State, Industrial Development
Authority, Bachman Machine
Project, Ser A, RB, VRDN,
AMT (C)(D)(E)
4.200%, 06/04/97 90 90
State, Industrial Development
Authority, Plastic Enterprises
Project, Ser A, RB,
VRDN, AMT (C)(D)(E)(F)
4.200%, 06/04/97 385 385
State, Industrial Development
Authority, Precision Stainless
Project, Ser I, RB, VRDN, AMT
(C)(D)(E)
4.200%, 06/04/97 70 70
105
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
TAX-EXEMPT MONEY MARKET FUND--CONTINUED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
MISSOURI--CONTINUED
State, Custody Receipt, Third Street
Building Project, Ser A, GO,
VRDN (C)(D)(E)
4.200%, 06/04/97 $ 2,000 $ 2,000
---------
Total Missouri 3,245
---------
NEVADA (6.3%)
Clark County, Airport Improvement
Authority, Ser A, VRDN,
(MBIA) (C)(D)
3.850%, 06/04/97 10,000 10,000
Clark County, Airport Improvement,
Sub Lien, Ser A-1, RB,
VRDN (C)(D)(E)
3.850%, 06/04/97 4,300 4,300
Clark County, Nevada Power
Project, Ser A, VRDN,
AMT (C)(D)(E)
4.150%, 06/04/97 5,000 5,000
Clark County, School District,
VRDN (C)(D)(E)
3.960%, 06/05/97 8,000 8,000
---------
Total Nevada 27,300
---------
NEW HAMPSHIRE (5.5%)
State, Business Finance
Authority, TECP
3.650%, 07/29/97 7,000 7,000
State, Business Finance Authority,
Pollution Control,
Ser D, VRDN, AMT (C)
4.000%, 06/04/97 6,000 6,000
State, Business Finance
Authority, TECP (E)
3.400%, 06/11/97 5,000 5,000
State, Housing Finance Authority,
Multi-Family, Fairways Project,
Ser 1, RB, VRDN, AMT (C)(D)(E)
4.000%, 06/04/97 5,000 5,000
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
NEW HAMPSHIRE--CONTINUED
State, Pollution Control Authority,
CT Power and Light, Ser A, RB,
VRDN (C)(D)(E)
3.900%, 06/04/97 $ 800 $ 800
---------
Total New Hampshire 23,800
---------
NEW MEXICO (2.2%)
Hurley, New Mexico, Pollution
Control Authority, RB,
VRDN (C)(D)(E)
4.150%, 06/02/97 2,200 2,200
State, Educational Assistance
Foundation, Student Loan Program,
VRDN (AMBAC) (C)(D)
4.100%, 06/05/97 3,490 3,490
State, Mortgage Financial
Authority, Ser B-CR-123,
Optional Put 07/01/97 @ 100
3.400%, 07/01/17 3,995 3,995
---------
Total New Mexico 9,685
---------
NEW YORK (1.8%)
Urban Development Corporation,
Senior Lien, VRDN (C)(D)
3.960%, 06/05/97 7,600 7,600
---------
NORTH CAROLINA (2.1%)
Educational Facilities, Guilford
College, VRDN (C)(D)(E)
4.000%, 06/04/97 2,300 2,300
Mecklenburg County, Industrial
Facilities & Pollution Control,
Sterigenics International Project,
RB, VRDN, AMT (C)(D)(E)
4.250%, 06/04/97 2,000 2,000
State Municipal Power Authority,
Finance Authority, TECP (E)
3.400%, 06/10/97 5,000 5,000
---------
Total North Carolina 9,300
---------
106
<PAGE>
================================================================================
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
NORTH DAKOTA (0.4%)
Mercer County, Solid Waste Disposal
Authority, United Power Project,
RB, VRDN, AMT (C)(D)(E)
3.550%, 06/02/97 $1,900 $ 1,900
---------
OHIO (5.1%)
Columbus, Sewer
Revenue (C)(D)
3.800%, 06/05/97 9,600 9,600
State, Air Quality Development
Authority, JMG Limited Partnership,
Ser A, RB, VRDN, AMT (C)(D)(E)
3.900%, 06/04/97 3,000 3,000
State, Higher Education
Authority, Lake Erie Project,
RB, VRDN (C)(D)(E)
3.950%, 06/05/97 5,100 5,100
State, Pollution Control
Authority, Duquesne Project,
RB, VRDN, AMT (C)(D)(E)
3.950%, 06/04/97 3,000 3,000
Trumbull County, St. Joseph
Riverside Hospital Project,
RB, Pre-Refunded
11/01/97 @ 102 (F)
7.750%, 11/01/13 1,500 1,555
---------
Total Ohio 22,255
---------
PENNSYLVANIA (3.8%)
Beaver County, Industrial
Development Authority,
Duquesne Light Company
Project, Ser B, VRDN (C)(D)(E)
3.800%, 06/04/97 1,000 1,000
Philadelphia School District, TRAN
4.500%, 06/30/97 5,000 5,002
Philadelphia, TRAN
4.500%, 06/30/97 4,000 4,002
State, Ser A, VRDN Pre-Refunded
11/01/99 @ 101.5, (C)(F)
3.960%, 06/05/97 6,500 6,500
---------
Total Pennsylvania 16,504
---------
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
RHODE ISLAND (0.9%)
State, TAN
4.500%, 06/30/97 $4,000 $ 4,002
---------
SOUTH CAROLINA (1.2%)
York County, Pollution Control
Revenue, Ser N-4, VRDN,
Optional Put on 9/15/97
@ 100 (C)(D)(E)
3.550%, 09/15/14 5,000 5,000
---------
TENNESSEE (2.5%)
Covington, Industrial Development
Board, Charms Project, RB,
VRDN, AMT (C)(D)(E)
4.050%, 06/04/97 3,000 3,000
Hamilton County, Industrial
Development Board, Tennessee
Aquarium Project, VRDN (C)(D)(E)
3.950%, 06/05/97 3,000 3,000
Memphis-Shelby County, Industrial
Development Board, Ponderosa
Fibres American Project, RB,
VRDN, AMT (C)(D)(E)
4.100%, 06/05/97 1,600 1,600
Nashville & Davidson County,
Industrial Development Authority,
Multi-Family Mortgage,
Chimneytop II Project, RB,
VRDN (C)(D)(E)
3.950%, 06/02/97 1,325 1,325
Nashville & Davidson County,
Vanderbilt University, Ser 85A,
VRDN, Optional Put 1/15/98,
(C)(D)(E)
3.650%, 01/15/15 2,000 2,002
---------
Total Tennessee 10,927
---------
TEXAS (9.2%)
Brazos River, TECP (E)
3.450%, 06/09/97 2,700 2,700
Brownsville, Utility System, TECP
3.450%, 06/12/97 4,000 4,000
107
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
TAX-EXEMPT MONEY MARKET FUND--CONCLUDED
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
TEXAS--CONTINUED
Georgetown, Higher Education
Financing Authority, Southwestern
University Project, Ser 84, RB,
VRDN (C)(D)(E)
3.950%, 06/04/97 $2,000 $ 2,000
Harris County, Health Facilities
Authority, Memorial Hospital
Project, Ser B, RB, VRDN (C)(D)(E)
3.850%, 06/04/97 1,500 1,500
Harris County, Housing Finance
Corporation, Ser 1985,
VRDN (C)(D)(E)
4.225%, 06/05/97 900 900
Harris County, Industrial
Development Authority,
Lubrizol Project, RB, VRDN (C)(D)
3.850%, 06/04/97 1,600 1,600
Harris County, Toll Roads, Ser H,
RB, VRDN (C)(D)(E)
3.850%, 06/04/97 5,500 5,500
Lone Star, Airport Improvement,
Ser A2, RB, VRDN (C)(D)
4.000%, 06/02/97 1,700 1,700
South Higher Education
Authority, RB, VRDN,
AMT (C)(D)(E)
3.950%, 06/04/97 5,000 5,000
State, Public Finance
Authority, TECP
3.650%, 08/11/97 5,000 5,000
State, TAN
4.750%, 08/29/97 10,000 10,019
---------
Total Texas 39,919
---------
UTAH (1.5%)
Carbon County, Pollution Control
Authority, Pacificorp Project, RB,
VRDN (AMBAC) (C)(D)
4.150%, 06/02/97 1,600 1,600
Intermountain Power Agency, Ser E,
RB, Optional Put
09/15/97 @ 100 (E)
3.500%, 07/01/14 1,000 1,000
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
UTAH--CONTINUED
Intermountain Power Agency,
Optional Put 06/16/97
@ 100, RB, VRDN (C)(D)(E)
3.930%, 06/17/97 $4,000 $ 4,000
---------
Total Utah 6,600
---------
ERMONT (0.2%)
State, Ser B, GO,
4.600%, 08/01/97 1,000 1,001
---------
VIRGINIA (3.6%)
Bedford County, Industrial
Development Authority,
VRDN (C)(D)(E)
4.000%, 06/05/97 2,500 2,500
Chesterfield County, Industrial
Development Authority, Allied
Signal Project, RB,
VRDN (C)(D)(E)
4.050%, 06/04/97 3,000 3,000
Commonwealth, Ser 1994,
VRDN (C)(D)
4.060%, 06/05/97 4,000 4,000
Front Royal & Warren County,
Industrial Development Authority,
Pen Tab Industries Project, RB,
VRDN, AMT (C)(D)(E)
4.000%, 06/05/97 3,000 3,000
Peninsula Port Authority, Dominion
Term Project, Ser 1987C,
VRDN (C)(D)(E)
3.950%, 06/02/97 3,300 3,300
---------
Total Virginia 15,800
---------
WASHINGTON (2.6%)
Pierce County, Washington Economic
Development, Weyerhaeuser
Real Estate Project, RB,
VRDN (C)(D)
3.850%, 06/04/97 3,000 3,000
Port of Seattle, VRDN (C)(D)(E)
3.900%, 06/04/97 1,600 1,600
108
<PAGE>
================================================================================
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
WASHINGTON--CONTINUED
State Public Power Supply System,
Nuclear Project #1, 1993-1A3, RB,
VRDN (C)(D)(E)
3.850%, 06/04/97 $3,500 $ 3,500
State Student Loan Finance
Association, Ser B, RB,
VRDN, AMT (C)(D)(E)
3.950%, 06/05/97 3,000 3,000
---------
Total Washington 11,100
---------
WEST VIRGINIA (0.9%)
Marshall County, Pollution Control
Authority, Allied Signal Project,
RB, VRDN (C)(D)(E)
4.050%, 06/04/97 2,000 2,000
Marshall County, PPG Industries
Project, RB, VRDN (C)(D)(E)
4.100%, 06/05/97 2,000 2,000
---------
Total West Virginia 4,000
---------
WISCONSIN (0.7%)
Milwaukee, Ser BY, GO
7.250%, 06/15/97 1,000 1,001
Milwaukee, School
Order Notes, Ser B
4.250%, 08/21/97 1,000 1,002
Racine, Wisconsin Promissory
Notes, Ser 96 B, GO
3.700%, 12/15/97 1,165 1,165
---------
Total Wisconsin 3,168
---------
WYOMING (1.1%)
Sweetwater, Ser A,
RB, VRDN (C)(D)(E)
3.900%, 06/04/97 4,600 4,600
---------
Total Municipal Bonds
(Cost $428,223) 428,223
---------
- ------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
- ------------------------------------------------------------
CASH EQUIVALENT (1.3%)
AIM Management Institutional
Tax-Free Portfolio $5,853 $ 5,853
---------
Total Cash Equivalent
(Cost $5,853) 5,853
---------
Total Investments (99.8%)
(Cost $434,076) 434,076
---------
OTHER ASSETS AND LIABILITIES (0.2%)
Total Other Assets and Liabilities, Net 943
---------
NET ASSETS:
Fund shares of the Trust Shares
(unlimited authorization -- no
par value) based on 333,003,932
outstanding shares of beneficial
interest 333,004
Fund shares of the Investor Shares
(unlimited authorization -- no
par value) based on 102,018,739
outstanding shares of beneficial
interest 102,019
Accumulated net realized loss
on investments (4)
---------
Total Net Assets (100.0%) $ 435,019
=========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 1.00
=========
Net Asset Value, Offering Price and
Redemption Price Per Share --
Investor Shares $ 1.00
=========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 110.
109
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
KEY TO ABBREVIATIONS USED IN
THE STATEMENT OF NET ASSETS
ADR American Depository Receipt
AMBAC Security insured by the American Municipal
Bond Assurance Company
AMT Alternative Minimum Tax
ARM Adjustable Rate Mortgage
Cl Class
COP Certificate of Participation
CV Convertible Security
ETM Escrowed to Maturity
F Foreign Registry Shares
FGIC Security insured by the Financial Guaranty
Insurance Corporation
FHA Federal Housing Authority
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
FSA Security insured by Financial Security
Assurance
GDR Global Depository Receipt
GDS Global Depository Shares
GNMA Government National Mortgage Association
GO General Obligation
LYON Liquid Yield Option Note
MBIA Security insured by the Municipal Bond
Investors Assurance
MTN Medium Term Note
RB Revenue Bond
REIT Real Estate Investment Trust
REMIC Real Estate Mortgage Investment Conduit
Ser Series
SLMA Student Loan Marketing Association
STRIPS Separately Traded Registered Interest and
Principal Security
TAN Tax Anticipation Note
TECP Tax Exempt Commercial Paper
TRAN Tax & Revenue Anticipation Note
VRDN Variable Rate Demand Note
* Non-income producing securities
(A) Zero Coupon Bond
(B) Private Placement Security
(C) Variable rate security. The rate reported on the
Statement of Net Assets is the rate in effect on
May 31, 1997.
(D) Put and demand features exist requiring the
issuer to repurchase the instrument prior to
maturity.
(E) Securities are held in connection with a letter
of credit issued by a major bank.
(F) Collateralized by U.S. Government Securities
(G) In local currency
110
<PAGE>
================================================================================
[This Page Left Intentionally Blank]
<PAGE>
STATEMENT OF OPERATIONS (000)
================================================================================
STI CLASSIC FUNDS FOR THE PERIOD ENDED MAY 31, 1997
<TABLE>
<CAPTION>
MID-CAP SMALL CAP CAPITAL
VALUE INCOME EQUITY EQUITY GROWTH
STOCK FUND FUND FUND FUND
------------ --------- ---------- ---------
06/01/96- 06/01/96- 01/31/97*- 06/01/96-
05/31/97 05/31/97 05/31/97 05/31/97
------------ --------- ---------- ---------
Income:
<S> <C> <C> <C> <C>
Interest Income .................................................. $ 5,035 $ 1,386 $ 92 $ 6,139
Dividend Income .................................................. 44,675 2,627 765 18,021
Less: Foreign Taxes Withheld ..................................... -- -- -- --
-------- ------- ------ --------
Total Investment Income .......................................... 49,710 4,013 857 24,160
-------- ------- ------ --------
Expenses:
Investment Advisory Fees ......................................... 12,026 3,328 322 14,003
Less: Investment Advisory Fees Waived ............................ -- (318) (48) (1,226)
Less: Contribution from Advisor .................................. -- -- -- --
Administrator Fees ............................................... 1,009 194 18 818
Transfer Agent Fees-- Trust Shares ............................... 16 15 6 16
Transfer Agent Fees-- Investor Shares ............................ 103 31 -- 166
Transfer Agent Fees-- Flex Shares ................................ 53 24 -- 37
Transfer Agent Out of Pocket Fees ................................ 114 22 1 98
Printing Expenses ................................................ 102 20 2 85
Custody Fees ..................................................... 73 14 1 62
Professional Fees ................................................ 77 15 2 63
Trustee Fees ..................................................... 22 4 -- 19
Registration Fees ................................................ 138 27 22 58
Distribution Fees-- Investor Shares .............................. 470 82 -- 1,345
Less: Distribution Fees Waived-- Investor Shares ................. (32) (26) -- (236)
Distribution Fees-- Flex Shares .................................. 444 74 -- 213
Less: Distribution Fees Waived-- Flex Shares ..................... (11) (20) -- (12)
Insurance and Other Fees ......................................... 46 14 -- 40
Amortization of Deferred Organization Costs ...................... 11 -- 10 8
-------- ------- ------ --------
Total Expenses ................................................... 14,661 3,500 336 15,557
-------- ------- ------ --------
Net Investment Income (Loss) ..................................... 35,049 513 521 8,603
-------- ------- ------ --------
Net Realized and Unrealized Gain (Loss) on Investments:
Net Realized Gain (Loss) on Securities Sold ...................... 243,189 33,978 1,757 221,554
Net Realized Loss on Foreign Currency Transactions ............... -- -- -- --
Net Change in Unrealized Appreciation (Depreciation) on
Foreign Currency and Translation of Other Assets and
Liabilities in Foreign Currency ................................ -- -- -- --
Net Change in Unrealized Appreciation (Depreciation)
on Investments ................................................. 33,953 4,912 7,644 43,851
-------- ------- ------ --------
Total Net Realized and Unrealized Gain
on Investments ................................................. 277,142 38,890 9,401 265,405
-------- ------- ------ --------
Net Increase in Net Assets from Operations ....................... $312,191 $39,403 $9,922 $274,008
======== ======= ====== ========
EMERGING INTERNATIONAL INTERNATIONAL
BALANCED MARKETS EQUITY EQUITY
FUND EQUITY FUND INDEX FUND FUND
--------- ---------- --------- ------------
06/01/96- 01/31/97*- 06/01/96- 06/01/96-
05/31/97 05/31/97 05/31/97 05/31/97
--------- ---------- --------- ------------
Income:
<S> <C> <C> <C> <C>
Interest Income .................................................. $ 3,654 $ 49 $ 13 $ 922
Dividend Income .................................................. 1,113 272 1,382 6,838
Less: Foreign Taxes Withheld ..................................... -- (14) (108) (645)
------- ------ ------- -------
Total Investment Income .......................................... 4,767 307 1,287 7,115
------- ------ ------- -------
Expenses:
Investment Advisory Fees ......................................... 1,177 137 658 4,494
Less: Investment Advisory Fees Waived ............................ (151) (53) (80) (157)
Less: Contribution from Advisor .................................. -- -- -- --
Administrator Fees ............................................... 83 7 48 240
Transfer Agent Fees-- Trust Shares ............................... 16 5 18 12
Transfer Agent Fees-- Investor Shares ............................ 17 -- 21 14
Transfer Agent Fees-- Flex Shares ................................ 17 -- 15 17
Transfer Agent Out of Pocket Fees ................................ 9 1 9 22
Printing Expenses ................................................ 8 6 7 21
Custody Fees ..................................................... 6 34 70 484
Professional Fees ................................................ 6 1 6 15
Trustee Fees ..................................................... 2 -- 2 5
Registration Fees ................................................ 21 11 5 111
Distribution Fees-- Investor Shares .............................. 15 -- 22 21
Less: Distribution Fees Waived-- Investor Shares ................. (13) -- (14) (10)
Distribution Fees-- Flex Shares .................................. 43 -- 10 33
Less: Distribution Fees Waived-- Flex Shares ..................... (14) -- (10) (15)
Insurance and Other Fees ......................................... 4 4 15 18
Amortization of Deferred Organization Costs ...................... -- 10 3 2
------- ------ ------- -------
Total Expenses ................................................... 1,246 163 805 5,327
------- ------ ------- -------
Net Investment Income (Loss) ..................................... 3,521 144 482 1,788
------- ------ ------- -------
Net Realized and Unrealized Gain (Loss) on Investments:
Net Realized Gain (Loss) on Securities Sold ...................... 11,411 80 4,148 31,885
Net Realized Loss on Foreign Currency Transactions ............... -- (18) (50) (949)
Net Change in Unrealized Appreciation (Depreciation) on
Foreign Currency and Translation of Other Assets and
Liabilities in Foreign Currency ................................ -- -- (21) 16
Net Change in Unrealized Appreciation (Depreciation)
on Investments ................................................. 5,223 2,108 (466) 51,213
------- ------ ------- -------
Total Net Realized and Unrealized Gain
on Investments ................................................. 16,634 2,170 3,611 82,165
------- ------ ------- -------
Net Increase in Net Assets from Operations ....................... $20,155 $2,314 $ 4,093 $83,953
======= ====== ======= =======
INVESTMENT GRADE FLORIDA TENNESSEE
SUNBELT TAX-EXEMPT TAX-EXEMPT TAX-EXEMPT
EQUITY FUND BOND FUND BOND FUND BOND FUND
---------- ---------------- ---------- -----------
06/01/96- 06/01/96- 06/01/96- 06/01/96-
05/31/97 05/31/97 05/31/97 05/31/97
---------- ---------------- ---------- -----------
Income:
<S> <C> <C> <C> <C>
Interest Income .................................................. $ 18 $ 8,107 $2,318 $282
Dividend Income .................................................. 2,081 -- -- --
Less: Foreign Taxes Withheld ..................................... -- -- -- --
------ ------- ------ ----
Total Investment Income .......................................... 2,099 8,107 2,318 282
------ ------- ------ ----
Expenses:
Investment Advisory Fees ......................................... 4,842 1,272 293 35
Less: Investment Advisory Fees Waived ............................ (442) (189) (73) (35)
Less: Contribution from Advisor .................................. -- -- -- (10)
Administrator Fees ............................................... 283 115 31 4
Transfer Agent Fees-- Trust Shares ............................... 16 16 16 16
Transfer Agent Fees-- Investor Shares ............................ 44 34 13 12
Transfer Agent Fees-- Flex Shares ................................ 20 15 14 13
Transfer Agent Out of Pocket Fees ................................ 33 15 3 --
Printing Expenses ................................................ 30 13 3 --
Custody Fees ..................................................... 21 9 2 1
Professional Fees ................................................ 22 9 2 --
Trustee Fees ..................................................... 7 3 1 --
Registration Fees ................................................ 31 12 6 1
Distribution Fees-- Investor Shares .............................. 119 148 6 3
Less: Distribution Fees Waived-- Investor Shares ................. (39) (47) (6) --
Distribution Fees-- Flex Shares .................................. 45 51 27 23
Less: Distribution Fees Waived-- Flex Shares ..................... (18) (15) (21) (8)
Insurance and Other Fees ......................................... 13 7 2 --
Amortization of Deferred Organization Costs ...................... -- 8 -- --
------ ------- ------ ----
Total Expenses ................................................... 5,027 1,476 319 55
------ ------- ------ ----
Net Investment Income (Loss) ..................................... (2,928) 6,631 1,999 227
------ ------- ------ ----
Net Realized and Unrealized Gain (Loss) on Investments:
Net Realized Gain (Loss) on Securities Sold ...................... 24,062 2,924 (209) (11)
Net Realized Loss on Foreign Currency Transactions ............... -- -- -- --
Net Change in Unrealized Appreciation (Depreciation) on
Foreign Currency and Translation of Other Assets and
Liabilities in Foreign Currency ................................ -- -- -- --
Net Change in Unrealized Appreciation (Depreciation)
on Investments ................................................. (18,818) 2,169 1,157 153
------ ------- ------ ----
Total Net Realized and Unrealized Gain
on Investments ................................................. 5,244 5,093 948 142
------ ------- ------ ----
Net Increase in Net Assets from Operations ....................... $2,316 $11,724 $2,947 $369
====== ======= ====== ====
<FN>
*Commencement of Operations
Amounts designated as "--" are either $0 or round to $0.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
112 & 113
STATEMENT OF OPERATIONS (000) (concluded)
================================================================================
STI CLASSIC FUNDS FOR THE PERIOD ENDED MAY 31, 1997
<TABLE>
<CAPTION>
GEORGIA INVESTMENT
TAX-EXEMPT GRADE BOND SHORT-TERM
BOND FUND FUND BOND FUND
---------- ---------- ----------
06/01/96- 06/01/96- 06/01/96-
05/31/97 05/31/97 05/31/97
---------- ---------- ----------
<S> <C> <C> <C>
Interest Income ..................................................... $1,875 $43,028 $5,793
------ ------- ------
Expenses:
Investment Advisory Fees ......................................... 246 4,793 624
Less: Investment Advisory Fees Waived ............................ (64) (645) (138)
Administrator Fees ............................................... 25 435 65
Less: Administrator Fees Waived .................................. -- -- --
Transfer Agent Fees-- Trust Shares ............................... 16 16 16
Transfer Agent Fees-- Investor Shares ............................ 13 46 13
Transfer Agent Fees-- Flex Shares ................................ 14 19 13
Transfer Agent Out of Pocket Fees ................................ 3 54 8
Printing Expenses ................................................ 2 49 7
Custody Fees ..................................................... 2 34 5
Professional Fees ................................................ 2 34 5
Trustee Fees ..................................................... 1 11 2
Registration Fees ................................................ 5 64 13
Distribution Fees-- Investor Shares .............................. 6 153 5
Less: Distribution Fees Waived-- Investor Shares ................. (6) (59) (5)
Distribution Fees-- Flex Shares .................................. 46 54 10
Less: Distribution Fees Waived-- Flex Shares ..................... (26) (24) (10)
Insurance and Other Fees ......................................... 1 22 3
Amortization of Deferred Organization Costs ...................... -- 8 5
------ ------- ------
Total Expenses ................................................... 286 5,064 641
------ ------- ------
Net Investment Income ............................................... 1,589 37,964 5,152
------ ------- ------
Net Realized and Unrealized Gain (Loss) on Investments:
Net Realized Gain (Loss) on Securities Sold ...................... 7 (5,113) (321)
Net Change in Unrealized Appreciation
on Investments .................................................. 882 10,558 1,027
------ ------- ------
Total Net Realized and Unrealized Gain (Loss)
on Investments .................................................. 889 5,445 706
------ ------- ------
Net Increase in Net Assets from Operations .......................... $2,478 $43,409 $5,858
====== ======= ======
SHORT-TERM
U.S. TREASURY LIMITED-TERM U.S.
SECURITIES FEDERAL MORTGAGE GOVERNMENT
FUND SECURITIES FUND SECURITIES FUND
------------- ---------------- ---------------
06/01/96- 06/01/96- 06/01/96-
05/31/97 05/31/97 05/31/97
------------- ---------------- ---------------
<S> <C> <C> <C>
Interest Income ..................................................... $1,410 $6,871 $1,411
------ ------ ------
Expenses:
Investment Advisory Fees ......................................... 156 691 150
Less: Investment Advisory Fees Waived ............................ (73) (151) (59)
Administrator Fees ............................................... 16 71 14
Less: Administrator Fees Waived .................................. -- -- --
Transfer Agent Fees-- Trust Shares ............................... 16 16 16
Transfer Agent Fees-- Investor Shares ............................ 14 13 13
Transfer Agent Fees-- Flex Shares ................................ 14 14 15
Transfer Agent Out of Pocket Fees ................................ 2 6 1
Printing Expenses ................................................ 2 6 1
Custody Fees ..................................................... 1 4 1
Professional Fees ................................................ 1 5 1
Trustee Fees ..................................................... -- 1 --
Registration Fees ................................................ 17 30 19
Distribution Fees-- Investor Shares .............................. 7 6 10
Less: Distribution Fees Waived-- Investor Shares ................. (7) (6) (9)
Distribution Fees-- Flex Shares .................................. 21 16 30
Less: Distribution Fees Waived-- Flex Shares ..................... (20) (16) (15)
Insurance and Other Fees ......................................... 1 3 1
Amortization of Deferred Organization Costs ...................... 4 2 2
------ ------ ------
Total Expenses ................................................... 172 711 191
------ ------ ------
Net Investment Income ............................................... 1,238 6,160 1,220
------ ------ ------
Net Realized and Unrealized Gain (Loss) on Investments:
Net Realized Gain (Loss) on Securities Sold ...................... (25) 1 (17)
Net Change in Unrealized Appreciation
on Investments .................................................. 88 303 214
------ ------ ------
Total Net Realized and Unrealized Gain (Loss)
on Investments .................................................. 62 304 197
------ ------ ------
Net Increase in Net Assets from Operations .......................... $1,301 $6,464 $1,417
====== ====== ======
TAX-EXEMPT
PRIME QUALITY U.S. GOVERNMENT MONEY
MONEY MARKET SECURITIES MONEY MARKET
FUND MARKET FUND FUND
------------- --------------- ----------
06/01/96- 06/01/96- 06/01/96-
05/31/97 05/31/97 05/31/97
------------- --------------- ----------
<S> <C> <C> <C>
Interest Income ..................................................... $82,489 $20,206 $15,230
------- ------- -------
Expenses:
Investment Advisory Fees ......................................... 9,767 2,455 2,361
Less: Investment Advisory Fees Waived ............................ (2,181) (519) (674)
Administrator Fees ............................................... 1,009 254 289
Less: Administrator Fees Waived .................................. (348) (41) --
Transfer Agent Fees-- Trust Shares ............................... 16 16 16
Transfer Agent Fees-- Investor Shares ............................ 35 23 18
Transfer Agent Fees-- Flex Shares ................................ -- -- --
Transfer Agent Out of Pocket Fees ................................ 107 34 36
Printing Expenses ................................................ 95 26 29
Custody Fees ..................................................... 69 21 22
Professional Fees ................................................ 80 21 23
Trustee Fees ..................................................... 21 7 7
Registration Fees ................................................ 162 27 38
Distribution Fees-- Investor Shares .............................. 551 106 149
Less: Distribution Fees Waived-- Investor Shares ................. (208) (40) (59)
Distribution Fees-- Flex Shares .................................. -- -- --
Less: Distribution Fees Waived-- Flex Shares ..................... -- -- --
Insurance and Other Fees ......................................... 25 8 9
Amortization of Deferred Organization Costs ...................... 8 8 8
------- ------- -------
Total Expenses ................................................... 9,208 2,406 2,272
------- ------- -------
Net Investment Income ............................................... 73,281 17,800 12,958
------- ------- -------
Net Realized and Unrealized Gain (Loss) on Investments:
Net Realized Gain (Loss) on Securities Sold ...................... (121) (51) 10
Net Change in Unrealized Appreciation
on Investments .................................................. -- -- --
------- ------- -------
Total Net Realized and Unrealized Gain (Loss)
on Investments .................................................. (121) (51) 10
------- ------- -------
Net Increase in Net Assets from Operations .......................... $73,160 $17,749 $12,968
======= ======= =======
<FN>
Amounts designated as "--" are either $0 or round to $0.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
114 & 115
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (000)
================================================================================
STI CLASSIC FUNDS FOR THE YEAR ENDED MAY 31, 1997
<TABLE>
<CAPTION>
VALUE INCOME MID-CAP EQUITY SMALL CAP
STOCK FUND FUND EQUITY FUND
------------------- ------------------- ----------
06/01/96- 06/01/95- 06/01/96- 06/01/95- 01/31/97*-
05/31/97 05/31/96 05/31/97 05/31/96 05/31/97
--------- --------- --------- --------- ----------
Operations:
<S> <C> <C> <C> <C> <C>
Net Investment Income (Loss) .................. $ 35,049 $ 33,101 $ 513 $ 1,365 $ 521
Net Realized Gain on Investments .............. 243,189 196,134 33,978 29,513 1,757
Net Realized Loss on Foreign Currency
Transactions ................................ -- -- -- -- --
Net Change in Unrealized Appreciation
(Depreciation) on Foreign Currency
and Translation of Other Assets and
Liabilities in Foreign Currency ............. -- -- -- -- --
Net Change in Unrealized Appreciation
(Depreciation)on Investments ................ 33,953 60,796 4,912 12,518 7,644
---------- ---------- -------- -------- --------
Increase in Net Assets from Operations ...... 312,191 290,031 39,403 43,396 9,922
---------- ---------- -------- -------- --------
Distributions to Shareholders:
Net Investment Income:
Trust Shares ................................ (30,805) (29,124) (962) (1,285) (205)
Investor Shares ............................. (2,820) (2,618) (17) (30) --
Flex Shares ................................. (606) (206) -- (1) --
Capital Gains:
Trust Shares ................................ (166,191) (92,363) (24,244) (13,072) --
Investor Shares ............................. (18,030) (9,853) (1,770) (922) --
Flex Shares ................................. (5,570) (1,106) (676) (167) --
---------- ---------- -------- -------- --------
Total Distributions ........................... (224,022) (135,270) (27,669) (15,477) (205)
---------- ---------- -------- -------- --------
Capital Transactions (1):
Trust Shares:
Proceeds from Shares Issued ................. 380,339 371,542 113,386 133,402 126,046
Reinvestment of Cash Distributions .......... 179,808 111,671 22,790 13,361 137
Cost of Shares Repurchased .................. (392,524) (369,739) (113,291) (44,487) (4,851)
---------- ---------- -------- -------- --------
Increase (Decrease) in Net Assets From Trust
Share Transactions .......................... 167,623 113,474 22,885 102,276 121,332
---------- ---------- -------- -------- --------
Investor Shares:
Proceeds from Shares Issued ................. 31,242 31,177 5,664 10,027 --
Reinvestment of Cash Distributions .......... 20,626 12,291 1,783 948 --
Cost of Shares Repurchased .................. (24,774) (19,420) (5,934) (2,010) --
---------- ---------- -------- -------- --------
Increase (Decrease) in Net Assets From Investor
Share Transactions .......................... 27,094 24,048 1,513 8,965 --
---------- ---------- -------- -------- --------
Flex Shares:
Proceeds from Shares Issued ................. 43,363 24,893 5,680 5,125 --
Reinvestment of Cash Distributions .......... 6,080 1,301 666 163 --
Cost of Shares Repurchased .................. (6,096) (1,416) (1,648) (450) --
---------- ---------- -------- -------- --------
Increase (Decrease) in Net Assets From
Flex Share Transactions ..................... 43,347 24,778 4,698 4,838 --
---------- ---------- -------- -------- --------
Increase (Decrease) in Net Assets From Share
Transactions .............................. 238,064 162,300 29,096 116,079 121,332
---------- ---------- -------- -------- --------
Total Increase (Decrease) in Net Assets ... 326,233 317,061 40,830 143,998 131,049
---------- ---------- -------- -------- --------
Net Assets:
Beginning of Period ........................... 1,401,294 1,084,233 276,905 132,907 --
---------- ---------- -------- -------- --------
End of Period ................................. $1,727,527 $1,401,294 $317,735 $276,905 $131,049
========== ========== ======== ======== ========
(1)Shares Issued and Redeemed:
Trust Shares:
Shares Issued ............................... 29,343 29,898 9,011 10,952 12,290
Shares Issued in Lieu of Cash Distributions . 14,654 9,282 1,853 1,144 13
Shares Redeemed ............................. (30,076) (30,154) (9,008) (3,620) (466)
---------- ---------- -------- -------- --------
Net Trust Share Transactions .................. 13,921 9,026 1,856 8,476 11,837
---------- ---------- -------- -------- --------
Investor Shares:
Shares Issued ............................... 2,411 2,522 455 824 --
Shares Issued in Lieu of Cash Distributions . 1,683 1,023 145 82 --
Shares Redeemed ............................. (1,906) (1,569) (472) (165) --
---------- ---------- -------- -------- --------
Net Investor Share Transactions ............... 2,188 1,976 128 741 --
---------- ---------- -------- -------- --------
Flex Shares:
Shares Issued ............................... 3,360 2,014 459 419 --
Shares Issued in Lieu of Cash Distributions 500 108 55 14 --
Shares Redeemed ............................. (470) (113) (134) (37) --
---------- ---------- -------- -------- --------
Net Flex Share Transactions ................... 3,390 2,009 380 396 --
========== ========== ======== ======== ========
EMERGING INTERNATIONAL
MARKETS EQUITY
CAPITAL GROWTH FUND BALANCED FUND EQUITY FUND INDEX FUND
--------------------- ------------------- -------------- ------------------
06/01/96- 06/01/95- 06/01/96- 06/01/95- 01/31/97*- 06/01/96- 06/01/95-
05/31/97 05/31/96 05/31/97 05/31/96 05/31/97 05/31/97 05/31/96
--------- --------- --------- --------- ---------- --------- ---------
Operations:
<S> <C> <C> <C> <C> <C> <C> <C>
Net Investment Income (Loss) .................. $ 8,603 $ 9,278 $ 3,521 $ 3,088 $ 144 $ 482 $ 800
Net Realized Gain on Investments .............. 221,554 224,050 11,411 11,091 80 4,148 1,134
Net Realized Loss on Foreign Currency
Transactions ................................ -- -- -- -- (18) (50) --
Net Change in Unrealized Appreciation
(Depreciation on Foreign Currency
and Translation of Other Assets and
Liabilities in Foreign Currency ............. -- -- -- -- -- (21) (7)
Net Change in Unrealized Appreciation
(Depreciation)on Investments ................. 43,851 63,301 5,223 1,891 2,108 (466) 6,362
---------- ---------- -------- -------- ------- ------- -------
Increase in Net Assets from Operations ...... 274,008 296,629 20,155 16,070 2,314 4,093 8,289
---------- ---------- -------- -------- ------- ------- -------
Distributions to Shareholders:
Net Investment Income:
Trust Shares ................................ (7,993) (9,644) (3,051) (2,933) -- (614) (1,048)
Investor Shares ............................. (338) (570) (139) (115) -- (35) (59)
Flex Shares ................................. -- (5) (77) (31) -- -- (7)
Capital Gains:
Trust Shares ................................ (180,731) (41,659) (9,775) (904) -- (1,696) (743)
Investor Shares ............................. (35,976) (7,343) (505) (44) -- (154) (43)
Flex Shares ................................. (3,858) (227) (388) (18) -- (27) (6)
---------- ---------- -------- -------- ------- ------- -------
Total Distributions ........................... (228,896) (59,448) (13,935) (4,045) -- (2,526) (1,906)
---------- ---------- -------- -------- ------- ------- -------
Capital Transactions (1):
Trust Shares:
Proceeds from Shares Issued ................. 295,281 187,108 75,303 54,735 42,043 21,944 62,965
Reinvestment of Cash Distributions .......... 178,092 48,431 12,606 3,784 -- 1,958 1,417
Cost of Shares Repurchased .................. (406,707) (439,271) (54,011) (47,301) (4,862) (62,693) (68,891)
---------- ---------- -------- -------- ------- ------- -------
Increase (Decrease) in Net Assets From Trust Share
Transactions ................................ 66,666 (203,732) 33,898 11,218 37,181 (38,791) (4,509)
---------- ---------- -------- -------- ------- ------- -------
Investor Shares:
Proceeds from Shares Issued ................. 22,778 21,971 1,430 1,315 -- 2,579 3,017
Reinvestment of Cash Distributions .......... 36,046 7,818 633 155 -- 189 101
Cost of Shares Repurchased .................. (38,034) (34,867) (1,149) (844) -- (2,981) (1,782)
---------- ---------- -------- -------- ------- ------- -------
Increase (Decrease) in Net Assets From Investor
Share Transactions .......................... 20,790 (5,078) 914 626 -- (213) 1,336
---------- ---------- -------- -------- ------- ------- -------
Flex Shares:
Proceeds from Shares Issued ................. 23,389 10,505 3,065 3,359 -- 334 992
Reinvestment of Cash Distributions .......... 3,813 230 462 49 -- 27 13
Cost of Shares Repurchased .................. (2,774) (641) (787) (428) -- (410) (127)
---------- ---------- -------- -------- ------- ------- -------
Increase (Decrease) in Net Assets From
Flex Share Transactions ..................... 24,428 10,094 2,740 2,980 -- (49) 878
---------- ---------- -------- -------- ------- ------- -------
Increase (Decrease) in Net Assets From Share
Transactions .............................. 111,884 (198,716) 37,552 14,824 37,181 (39,053) (2,295)
---------- ---------- -------- -------- ------- ------- -------
Total Increase (Decrease) in Net Assets ... 156,996 38,465 43,772 26,849 39,495 (37,486) 4,088
---------- ---------- -------- -------- ------- ------- -------
Net Assets:
Beginning of Period ........................... 1,183,545 1,145,080 119,665 92,816 -- 97,494 93,406
---------- ---------- -------- -------- ------- ------- -------
End of Period ................................. $1,340,541 $1,183,545 $163,437 $119,665 $39,495 $60,008 $97,494
========== ========== ======== ======== ======= ======= =======
(1)Shares Issued and Redeemed:
Trust Shares:
Shares Issued ............................... 20,391 13,624 6,572 4,974 4,128 2,030 5,971
Shares Issued in Lieu of Cash Distributions . 13,369 3,617 1,122 346 -- 184 134
Shares Redeemed ............................. (27,687) (32,204) (4,686) (4,335) (468) (5,800) (6,536)
---------- ---------- -------- -------- ------- ------- -------
Net Trust Share Transactions .................. 6,073 (14,963) 3,008 985 3,660 (3,586) (431)
---------- ---------- -------- -------- ------- ------- -------
Investor Shares:
Shares Issued ............................... 1,573 1,605 122 119 -- 241 286
Shares Issued in Lieu of Cash Distributions . 2,717 585 56 14 -- 18 10
Shares Redeemed ............................. (2,607) (2,576) (99) (76) -- (277) (170)
---------- ---------- -------- -------- ------- ------- -------
Net Investor Share Transactions ............... 1,683 (386) 79 57 -- (18) 126
---------- ---------- -------- -------- ------- ------- -------
Flex Shares:
Shares Issued ............................... 1,620 768 265 305 -- 31 95
Shares Issued in Lieu of Cash Distributions 289 17 41 5 -- 3 1
Shares Redeemed ............................. (191) (46) (68) (38) -- (38) (12)
---------- ---------- -------- -------- ------- ------- -------
Net Flex Share Transactions ................... 1,718 739 238 272 -- (4) 84
========== ========== ======== ======== ======= ======= =======
INTERNATIONAL
EQUITY
FUND SUNBELT EQUITY FUND
------------------- ---------------------
06/01/96- 12/01/95*- 06/01/96- 06/01/95-
05/31/97 05/31/96 05/31/97 05/31/96
--------- --------- --------- ---------
Operations:
<S> <C> <C> <C> <C>
Net Investment Income (Loss) .................. $ 1,788 $ 986 $ (2,928) $ (1,275)
Net Realized Gain on Investments .............. 31,885 4,059 24,062 39,898
Net Realized Loss on Foreign Currency
Transactions ................................ (949) (265) -- --
Net Change in Unrealized Appreciation
(Depreciation) on Foreign Currency
and Translation of Other Assets and
Liabilities in Foreign Currency ............. 16 (10) -- --
Net Change in Unrealized Appreciation
(Depreciation)on Investments ................ 51,213 13,617 (18,818) 84,777
-------- -------- -------- --------
Increase in Net Assets from Operations ...... 83,953 18,387 2,316 123,400
-------- -------- -------- --------
Distributions to Shareholders:
Net Investment Income:
Trust Shares ................................ (638) -- -- --
Investor Shares ............................. -- -- -- --
Flex Shares ................................. -- -- -- --
Capital Gains:
Trust Shares ................................ (9,573) -- (29,932) (5,188)
Investor Shares ............................. (182) -- (2,119) (426)
Flex Shares ................................. (75) -- (360) (20)
-------- -------- -------- --------
Total Distributions ........................... (10,468) -- (32,411) (5,634)
-------- -------- -------- --------
Capital Transactions (1):
Trust Shares:
Proceeds from Shares Issued ................. 382,588 212,805 208,763 132,237
Reinvestment of Cash Distributions .......... 9,386 -- 27,551 4,956
Cost of Shares Repurchased .................. (187,406) (17,640) (239,412) (92,700)
-------- -------- -------- --------
Increase (Decrease) in Net Assets From Trust
Shares Transactions ......................... 204,568 195,165 (3,098) 44,493
-------- -------- -------- --------
Investor Shares:
Proceeds from Shares Issued ................. 7,794 3,467 6,043 5,187
Reinvestment of Cash Distributions .......... 181 -- 2,111 426
Cost of Shares Repurchased .................. (2,060) (220) (7,103) (7,209)
-------- -------- -------- --------
Increase (Decrease) in Net Assets From Investor
Share Transactions .......................... 5,915 3,247 1,051 (1,596)
-------- -------- -------- --------
Flex Shares:
Proceeds from Shares Issued ................. 7,049 911 3,978 2,489
Reinvestment of Cash Distributions .......... 74 -- 354 20
Cost of Shares Repurchased .................. (424) (3) (1,172) (123)
-------- -------- -------- --------
Increase (Decrease) in Net Assets From
Flex Share Transactions ..................... 6,699 908 3,160 2,386
-------- -------- -------- --------
Increase (Decrease) in Net Assets From Share
Transactions .............................. 217,182 199,320 1,113 45,283
-------- -------- -------- --------
Total Increase (Decrease) in Net Assets ... 290,667 217,707 (28,982) 163,049
-------- -------- -------- --------
Net Assets:
Beginning of Period ........................... 217,707 -- 444,137 281,088
-------- -------- -------- --------
End of Period ................................. $508,374 $217,707 $415,155 $444,137
======== ======== ======== ========
(1)Shares Issued and Redeemed:
Trust Shares:
Shares Issued ............................... 31,059 20,338 16,289 10,848
Shares Issued in Lieu of Cash Distributions . 785 -- 2,176 437
Shares Redeemed ............................. (14,649) (1,635) (18,979) (7,882)
-------- -------- -------- --------
Net Trust Share Transactions .................. 17,195 18,703 (514) 3,403
-------- -------- -------- --------
Investor Shares:
Shares Issued ............................... 634 324 473 428
Shares Issued in Lieu of Cash Distributions . 15 -- 169 38
Shares Redeemed ............................. (166) (21) (569) (614)
-------- -------- -------- --------
Net Investor Share Transactions ............... 483 303 73 (148)
-------- -------- -------- --------
Flex Shares:
Shares Issued ............................... 566 84 310 202
Shares Issued in Lieu of Cash Distributions 6 -- 29 2
Shares Redeemed ............................. (34) -- (95) (10)
-------- -------- -------- --------
Net Flex Share Transactions ................... 538 84 244 194
======== ======== ======== ========
<FN>
*Commencement of operations.
Amounts designated as "--" are either $0 or round to $0.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
116 & 117
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (000) (continued)
================================================================================
STI CLASSIC FUNDS FOR THE YEAR ENDED MAY 31, 1997
<TABLE>
<CAPTION>
FLORIDA TENNESSEE
INVESTMENT GRADE TAX- TAX-EXEMPT TAX-EXEMPT
EXEMPT BOND FUND BOND FUND BOND FUND
-------------------- --------------------- --------------------
06/01/96- 06/01/95- 06/01/96- 06/01/95- 06/01/96- 06/01/95-
05/31/97 05/31/96 05/31/97 05/31/96 05/31/97 05/31/96
--------- --------- --------- --------- --------- ---------
Operations:
<S> <C> <C> <C> <C> <C> <C>
Net Investment Income ................... $ 6,631 $ 5,851 $ 1,999 $ 1,235 $ 227 $ 185
Net Realized Gain (Loss) on Investments . 2,924 5,634 (209) 220 (11) 13
Net Change in Unrealized Appreciation
(Depreciation) on Investments ......... 2,169 (3,672) 1,157 (723) 153 (96)
-------- -------- ------- ------- ------ ------
Increase in Net Assets from Operations 11,724 7,813 2,947 732 369 102
-------- -------- ------- ------- ------ ------
Distributions to Shareholders:
Net Investment Income:
Trust Shares .......................... (5,248) (4,292) (1,748) (996) (74) (80)
Investor Shares ....................... (1,226) (1,492) (154) (171) (65) (54)
Flex Shares ........................... (159) (120) (101) (65) (88) (51)
Capital Gains:
Trust Shares .......................... (2,384) (3,335) (126) (111) -- --
Investor Shares ....................... (623) (1,295) (11) (21) -- --
Flex Shares ........................... (92) (137) (9) (10) -- --
-------- -------- ------- ------- ------ ------
Total Distributions ..................... (9,732) (10,671) (2,149) (1,374) (227) (185)
-------- -------- ------- ------- ------ ------
Capital Transactions (1):
Trust Shares:
Proceeds from Shares Issued ........... 45,948 87,347 27,976 30,124 1,241 414
Reinvestment of Cash Distributions .... 3,196 4,062 314 228 33 36
Cost of Shares Repurchased ............ (36,027) (42,946) (9,265) (9,139) (1,174) (264)
-------- -------- ------- ------- ------ ------
Increase (Decrease) in Net Assets From
Trust Share Transactions .............. 13,117 48,463 19,025 21,213 100 186
-------- -------- ------- ------- ------ ------
Investor Shares:
Proceeds from Shares Issued ........... 2,163 4,535 923 1,865 450 668
Reinvestment of Cash Distributions .... 1,619 2,347 128 127 51 35
Cost of Shares Repurchased ............ (9,763) (10,550) (1,919) (1,235) (459) (333)
-------- -------- ------- ------- ------ ------
Increase (Decrease) in Net Assets From
Investor Share Transactions ........... (5,981) (3,668) (868) 757 42 370
-------- -------- ------- ------- ------ ------
Flex Shares:
Proceeds from Shares Issued ........... 1,973 6,823 1,182 2,844 836 2,235
Reinvestment of Cash Distributions .... 222 222 80 50 53 36
Cost of Shares Repurchased ............ (3,111) (1,413) (1,011) (153) (456) (215)
-------- -------- ------- ------- ------ ------
Increase (Decrease) in Net Assets From
Flex Share Transactions ............... (916) 5,632 251 2,741 433 2,056
-------- -------- ------- ------- ------ ------
Increase (Decrease) in Net Assets From
Share Transactions .................... 6,220 50,427 18,408 24,711 575 2,612
-------- -------- ------- ------- ------ ------
Total Increase (Decrease) in Net Assets 8,212 47,569 19,206 24,069 717 2,529
-------- -------- ------- ------- ------ ------
Net Assets:
Beginning of Period ..................... 167,470 119,901 37,507 13,438 5,363 2,834
-------- -------- ------- ------- ------ ------
End of Period ........................... $175,682 $167,470 $56,713 $37,507 $6,080 $5,363
======== ======== ======= ======= ====== ======
(1)Shares Issued and Redeemed:
Trust Shares:
Shares Issued ......................... 4,112 7,736 2,728 2,945 130 43
Shares Issued in Lieu of Cash Distributions 286 362 31 22 3 4
Shares Redeemed ....................... (3,216) (3,816) (907) (902) (122) (28)
-------- -------- ------- ------- ------ ------
Net Trust Share Transactions ............ 1,182 4,282 1,852 2,065 11 19
-------- -------- ------- ------- ------ ------
Investor Shares:
Shares Issued ......................... 193 401 89 182 47 70
Shares Issued in Lieu of Cash Distributions 144 208 13 12 5 4
Shares Redeemed ....................... (869) (934) (188) (120) (48) (35)
-------- -------- ------- ------- ------ ------
Net Investor Share Transactions ......... (532) (325) (86) 74 4 39
-------- -------- ------- ------- ------ ------
Flex Shares:
Shares Issued ......................... 176 603 115 277 88 233
Shares Issued in Lieu of Cash Distributions 20 20 8 5 6 4
Shares Redeemed ....................... (277) (125) (99) (15) (48) (23)
-------- -------- ------- ------- ------ ------
Net Flex Share Transactions ............. (81) 498 24 267 46 214
======== ======== ======= ======= ====== ======
GEORGIA SHORT-TERM
TAX-EXEMPT INVESTMENT GRADE SHORT-TERM BOND U.S. TREASURY
BOND FUND BOND FUND FUND SECURITIES FUND
------------------- ------------------- ------------------- -------------------
06/01/96- 06/01/95- 06/01/96- 06/01/95- 06/01/96- 06/01/95- 06/01/96- 06/01/95-
05/31/97 05/31/96 05/31/97 05/31/96 05/31/97 05/31/96 05/31/97 05/31/96
--------- --------- --------- --------- --------- --------- --------- ---------
Operations:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Investment Income ................... $ 1,589 $ 971 $ 37,964 $ 35,694 $ 5,152 $ 4,224 $ 1,238 $ 915
Net Realized Gain (Loss) on Investments . 7 330 (5,113) 19,716 (321) 1,358 (25) 95
Net Change in Unrealized Appreciation
(Depreciation) on Investments ......... 882 (789) 10,558 (32,383) 1,027 (2,395) 88 (294)
------- ------- -------- -------- ------- ------- ------- -------
Increase in Net Assets from Operations 2,478 512 43,409 23,027 5,858 3,187 1,301 716
------- ------- -------- -------- ------- ------- ------- -------
Distributions to Shareholders:
Net Investment Income:
Trust Shares .......................... (1,285) (747) (35,713) (33,703) (4,983) (4,065) (934) (551)
Investor Shares ....................... (139) (139) (1,950) (1,908) (120) (133) (205) (308)
Flex Shares ........................... (165) (88) (270) (114) (51) (26) (99) (56)
Capital Gains:
Trust Shares .......................... (153) (26) -- -- (311) (124) -- --
Investor Shares ....................... (17) (6) -- -- (7) (4) -- --
Flex Shares ........................... (26) (4) -- -- (4) (1) -- --
------- ------- -------- -------- ------- ------- ------- -------
Total Distributions ..................... (1,785) (1,010) (37,933) (35,725) (5,476) (4,353) (1,238) (915)
------- ------- -------- -------- ------- ------- ------- -------
Capital Transactions (1):
Trust Shares:
Proceeds from Shares Issued ........... 29,571 17,893 218,768 203,235 43,385 60,843 17,856 5,744
Reinvestment of Cash Distributions .... 761 215 27,532 26,403 3,426 2,588 465 334
Cost of Shares Repurchased ............ (14,098) (7,944)(217,253) (161,583) (48,636) (32,113) (6,510) (5,409)
------- ------- -------- -------- ------- ------- ------- -------
Increase (Decrease) in Net Assets From
Trust Share Transactions .............. 16,234 10,164 29,047 68,055 (1,825) 31,318 11,811 669
------- ------- -------- -------- ------- ------- ------- -------
Investor Shares:
Proceeds from Shares Issued ........... 573 661 5,838 8,832 602 642 745 966
Reinvestment of Cash Distributions .... 137 109 1,770 1,510 111 90 204 278
Cost of Shares Repurchased ............ (677) (596) (10,944) (7,248) (1,240) (606) (1,238) (4,147)
------- ------- -------- -------- ------- ------- ------- -------
Increase (Decrease) in Net Assets From Investor
Share Transactions .................... 33 174 (3,336) 3,094 (527) 126 (289) (2,903)
------- ------- -------- -------- ------- ------- ------- -------
Flex Shares:
Proceeds from Shares Issued ........... 1,697 4,355 3,077 5,179 523 1,014 825 2,603
Reinvestment of Cash Distributions .... 172 75 237 88 50 22 85 39
Cost of Shares Repurchased ............ (1,499) (150) (2,217) (508) (469) (53) (2,259) (188)
------- ------- -------- -------- ------- ------- ------- -------
Increase (Decrease) in Net Assets From
Flex Share Transactions ............... 370 4,280 1,097 4,759 104 983 (1,349) 2,454
------- ------- -------- -------- ------- ------- ------- -------
Increase (Decrease) in Net Assets From Share
Transactions ........................ 16,637 14,618 26,808 75,908 (2,248) 32,427 10,173 220
------- ------- -------- -------- ------- ------- ------- -------
Total Increase (Decrease) in Net Assets 17,330 14,120 32,284 63,210 (1,866) 31,261 10,236 21
------- ------- -------- -------- ------- ------- ------- -------
Net Assets:
Beginning of Period ..................... 30,575 16,455 640,290 577,080 94,822 63,561 16,764 16,743
------- ------- -------- -------- ------- ------- ------- -------
End of Period ........................... $47,905 $30,575 $672,574 $640,290 $92,956 $94,822 $27,000 $16,764
======= ======= ======== ======== ======= ======= ======= =======
(1)Shares Issued and Redeemed:
Trust Shares:
Shares Issued ......................... 3,062 1,832 21,475 19,682 4,380 6,066 1,806 579
Shares Issued in Lieu of Cash Distributions 78 22 2,709 2,550 345 258 47 34
Shares Redeemed ....................... (1,457) (823) (21,378) (15,629) (4,902) (3,190) (659) (547)
------- ------- -------- -------- ------- ------- ------- -------
Net Trust Share Transactions ............ 1,683 1,031 2,806 6,603 (177) 3,134 1,194 66
------- ------- -------- -------- ------- ------- ------- -------
Investor Shares:
Shares Issued ......................... 59 68 575 856 61 64 75 97
Shares Issued in Lieu of Cash Distributions 14 11 174 146 11 9 21 28
Shares Redeemed ....................... (70) (61) (1,076) (701) (125) (60) (125) (418)
------- ------- -------- -------- ------- ------- ------- -------
Net Investor Share Transactions ......... 3 18 (327) 301 (53) 13 (29) (293)
------- ------- -------- -------- ------- ------- ------- -------
Flex Shares:
Shares Issued ......................... 175 448 303 499 52 101 84 262
Shares Issued in Lieu of Cash Distributions 18 8 23 8 5 2 9 4
Shares Redeemed ....................... (154) (15) (218) (49) (47) (5) (228) (19)
------- ------- -------- -------- ------- ------- ------- -------
Net Flex Share Transactions ............. 39 441 108 458 10 98 (135) 247
======== ======= ======== ======== ======= ======= ======= =======
LIMITED-TERM
FEDERAL MORTGAGE U. S. GOVERNMENT
SECURITIES FUND SECURITIES FUND
-------------------- --------------------
06/01/96- 06/01/95- 06/01/96- 06/01/95-
05/31/97 05/31/96 05/31/97 05/31/96
--------- --------- --------- ---------
Operations:
<S> <C> <C> <C> <C>
Net Investment Income ................... $ 6,160 $ 3,181 $ 1,220 $ 602
Net Realized Gain (Loss) on Investments . 1 389 (17) (24)
Net Change in Unrealized Appreciation (Dep
on Investments ........................ 303 (1,359) 214 (557)
-------- ------- ------- -------
Increase in Net Assets from Operations 6,464 2,211 1,417 21
-------- ------- ------- -------
Distributions to Shareholders:
Net Investment Income:
Trust Shares .......................... (5,933) (3,012) (916) (453)
Investor Shares ....................... (146) (68) (147) (68)
Flex Shares ........................... (81) (37) (157) (81)
Capital Gains:
Trust Shares .......................... (159) -- -- (18)
Investor Shares ....................... (4) -- -- (3)
Flex Shares ........................... (3) -- -- (5)
-------- ------- ------- -------
Total Distributions ..................... (6,326) (3,117) (1,220) (628)
-------- ------- ------- -------
Capital Transactions (1):
Trust Shares:
Proceeds from Shares Issued ........... 75,207 46,841 19,904 9,824
Reinvestment of Cash Distributions .... 4,139 1,846 297 144
Cost of Shares Repurchased ............ (28,939) (16,287) (11,131) (2,556)
-------- ------- ------- -------
Increase (Decrease) in Net Assets From Tru
Transactions .......................... 50,407 32,400 9,070 7,412
-------- ------- ------- -------
Investor Shares:
Proceeds from Shares Issued ........... 1,381 2,404 1,272 2,290
Reinvestment of Cash Distributions .... 141 51 140 50
Cost of Shares Repurchased ............ (1,615) (533) (1,599) (456)
-------- ------- ------- -------
Increase (Decrease) in Net Assets From
Investor Share Transactions ........... (93) 1,922 (187) 1,884
-------- ------- ------- -------
Flex Shares:
Proceeds from Shares Issued ........... 500 1,538 764 3,019
Reinvestment of Cash Distributions .... 72 27 130 59
Cost of Shares Repurchased ............ (517) (196) (958) (148)
-------- ------- ------- -------
Increase (Decrease) in Net Assets From
Flex Share Transactions ............... 55 1,369 (64) 2,930
-------- ------- ------- -------
Increase (Decrease) in Net Assets From
Transactions .................. 50,369 35,691 8,819 12,226
-------- ------- ------- -------
Total Increase (Decrease) in
Net Assets 50,507 34,785 9,016 11,619
-------- ------- ------- -------
Net Assets:
Beginning of Period ..................... 77,231 42,446 15,499 3,880
-------- ------- ------- -------
End of Period ........................... $127,738 $77,231 $24,515 $15,499
======== ======= ======= =======
(1)Shares Issued and Redeemed:
Trust Shares:
Shares Issued ......................... 7,497 4,639 1,986 952
Shares Issued in Lieu of Cash Distributions 413 182 30 14
Shares Redeemed ....................... (2,886) (1,610) (1,110) (249)
-------- ------- ------- -------
Net Trust Share Transactions ............ 5,024 3,211 906 717
-------- ------- ------- -------
Investor Shares:
Shares Issued ......................... 138 238 127 225
Shares Issued in Lieu of Cash Distributions 14 5 14 5
Shares Redeemed ....................... (161) (53) (159) (45)
-------- ------- ------- -------
Net Investor Share Transactions ......... (9) 190 (18) 185
-------- ------- ------- -------
Flex Shares:
Shares Issued ......................... 50 152 77 294
Shares Issued in Lieu of Cash Distributions 7 2 13 6
Shares Redeemed ....................... (51) (19) (95) (15)
-------- ------- ------- -------
Net Flex Share Transactions ............. 6 135 (5) 285
======== ======= ======= =======
<FN>
Amounts designated as "--" are either $0 or round to $0.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
118 & 119
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (000) (concluded)
================================================================================
STI CLASSIC FUNDS FOR THE YEAR ENDED MAY 31, 1997
<TABLE>
<CAPTION>
U.S. GOVERNMENT
PRIME QUALITY SECURITIES TAX-EXEMPT
MONEY MARKET FUND MONEY MARKET FUND MONEY MARKET FUND
-------------------- --------------------- -------------------
06/01/96- 06/01/95- 06/01/96- 06/01/95- 06/01/96- 06/01/95-
05/31/97 05/31/96 05/31/97 05/31/96 05/31/97 05/31/96
--------- --------- --------- --------- --------- ---------
Operations:
<S> <C> <C> <C> <C> <C> <C>
Net Investment Income .................................. $ 73,281 $ 54,132 $ 17,800 $ 20,311 $ 12,958 $ 12,217
Net Realized Gain (Loss) on Investments ................ (121) (82) (51) 90 10 9
---------- ---------- -------- ---------- -------- --------
Increase in Net Assets from Operations ............. 73,160 54,050 17,749 20,401 12,968 12,226
---------- ---------- -------- ---------- -------- --------
Distributions to Shareholders:
Net Investment Income:
Trust Shares ......................................... (60,224) (44,689) (14,924) (17,516) (10,054) (9,342)
Investor Shares ...................................... (13,057) (9,442) (2,876) (2,795) (2,904) (2,872)
Capital Gains:
Trust Shares ......................................... -- -- -- -- -- --
Investor Shares ...................................... -- -- -- -- -- --
---------- ---------- -------- ---------- -------- --------
Total Distributions ................................ (73,281) (54,131) (17,800) (20,311) (12,958) (12,214)
---------- ---------- -------- ---------- -------- --------
Capital Transactions (1):
Trust Shares:
Proceeds from Shares Issued .......................... 2,786,281 2,131,623 705,839 1,156,411 980,872 719,678
Reinvestment of Cash Distributions ................... 2,069 1,223 274 60 -- 3
Cost of Shares Redeemed .............................. (2,752,496) (1,881,171) (687,215) (1,265,169) (921,487) (661,491)
---------- ---------- -------- ---------- -------- --------
Increase (Decrease) in Net Assets From Trust
Share Transactions 35,854 251,675 18,898 (108,698) 59,385 58,190
---------- ---------- -------- ---------- -------- --------
Investor Shares:
Proceeds from Shares Issued .......................... 928,946 1,012,310 182,325 231,451 305,724 322,435
Reinvestment of Cash Distributions ................... 10,375 8,255 2,379 2,414 2,569 2,480
Cost of Shares Redeemed .............................. (871,451) (962,468) (180,124) (221,906) (301,505) (317,341)
---------- ---------- -------- ---------- -------- --------
Increase in Net Assets From Investor Share Transactions 67,870 58,097 4,580 11,959 6,788 7,574
---------- ---------- -------- ---------- -------- --------
Increase in Net Assets From Share Transactions ....... 103,724 309,772 23,478 (96,739) 66,173 65,764
---------- ---------- -------- ---------- -------- --------
Total Increase (Decrease) in Net Assets ............ 103,603 309,691 23,427 (96,649) 66,183 65,776
---------- ---------- -------- ---------- -------- --------
Net Assets:
Beginning of Period .................................... 1,266,496 956,805 384,101 480,750 368,836 303,060
---------- ---------- -------- ---------- -------- --------
End of Period .......................................... $1,370,099 $1,266,496 $407,528 $ 384,101 $435,019 $368,836
---------- ---------- -------- ---------- -------- --------
(1) Shares Issued and Redeemed:
Trust Shares:
Shares Issued ........................................ 2,786,281 2,131,623 705,839 1,156,411 980,872 719,678
Shares Issued in Lieu of Cash Distributions .......... 2,069 1,223 274 60 -- 3
Shares Redeemed ...................................... (2,752,496)(1,881,171) (687,215) (1,265,169) (921,487) (661,491)
---------- ---------- -------- ---------- -------- --------
Net Trust Share Transactions ....................... 35,854 251,675 18,898 (108,698) 59,385 58,190
---------- ---------- -------- ---------- -------- --------
Investor Shares:
Shares Issued ........................................ 928,946 1,012,310 182,325 231,451 305,724 322,435
Shares Issued in Lieu of Cash Distributions .......... 10,375 8,255 2,379 2,414 2,569 2,480
Shares Redeemed ...................................... (871,451) (962,468) (180,124) (221,906) (301,505) (317,341)
---------- ---------- -------- ---------- -------- --------
Net Investor Share Transactions .................... 67,870 58,097 4,580 11,959 6,788 7,574
---------- ---------- -------- ---------- -------- --------
<FN>
Amounts designated as "--" are either $0 or round to $0.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
120
<PAGE>
[This Page Left Intentionally Blank]
<PAGE>
FINANCIAL HIGHLIGHTS
================================================================================
STI CLASSIC FUNDS FOR THE PERIOD FROM INCEPTION THROUGH MAY 31, 1997
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
NET REALIZED AND
NET UNREALIZED GAINS
NET ASSET VALUE INVESTMENT (LOSSES) DISTRIBUTIONS FROM DISTRIBUTIONS FROM
BEGINNING OF PERIOD INCOME (LOSS) ON INVESTMENTS NET INVESTMENT INCOME REALIZED CAPITAL GAINS
------------------- ------------- ---------------- --------------------- ----------------------
VALUE INCOME STOCK FUND
Trust Shares
<S> <C> <C> <C> <C> <C> <C>
1997 $13.15 $ 0.30 $ 2.32 $(0.30) $ (1.76)
1996 11.59 0.35 2.71 (0.34) (1.16)
1995 10.54 0.32 1.56 (0.32) (0.51)
1994 10.23 0.29 0.70 (0.32) (0.36)
1993(1) 10.00 0.11 0.16 (0.04) --
Investor Shares
1997 $13.13 $ 0.25 $ 2.32 $(0.26) $ (1.76)
1996 11.58 0.30 2.71 (0.30) (1.16)
1995 10.52 0.28 1.56 (0.27) (0.51)
1994 10.23 0.26 0.67 (0.27) (0.37)
1993(2) 9.73 0.09 0.44 (0.03) --
Flex Shares
1997 $13.08 $ 0.18 $ 2.29 $(0.18) $ (1.76)
1996(3) 11.59 0.26 2.65 (0.26) (1.16)
MID-CAP EQUITY FUND (B)
Trust Shares
1997 $12.76 $ 0.03 $ 1.69 $(0.05) $ (1.22)
1996 11.00 0.08 2.63 (0.08) (0.87)
1995 9.85 0.08 1.15 (0.08) --
1994(4) 10.00 0.02 (0.16) (0.01) --
Investor Shares
1997 $12.74 $(0.03) $ 1.69 $(0.01) $ (1.22)
1996 10.99 0.03 2.62 (0.03) (0.87)
1995 9.84 0.03 1.15 (0.03) --
1994(5) 10.00 0.01 (0.17) -- --
Flex Shares
1997 $12.69 $(0.07) $ 1.64 $ -- $ (1.22)
1996(6) 11.13 -- 2.45 (0.02) (0.87)
SMALL CAP EQUITY FUND
Trust Shares
1997(7) $10.00 $ 0.05 $ 1.04 $(0.02) $ --
CAPITAL GROWTH FUND
Trust Shares
1997 $14.90 $ 0.12 $ 3.13 $(0.12) $ (2.94)
1996 12.18 0.12 3.32 (0.13) (0.59)
1995 11.99 0.16 0.57 (0.14) (0.40)
1994 11.95 0.16 0.31 (0.17) (0.26)
1993(8) 10.36 0.12 1.57 (0.10) --
Investor Shares
1997 $14.89 $ 0.03 $ 3.10 $(0.02) $ (2.94)
1996 12.17 0.03 3.32 (0.04) (0.59)
1995 11.98 0.09 0.57 (0.07) (0.40)
1994 11.93 0.09 0.31 (0.09) (0.26)
1993(9) 10.00 0.06 1.93 (0.06) --
Flex Shares
1997 $14.84 $(0.01) $ 3.07 $ -- $ (2.94)
1996(3) 12.20 0.02 3.26 (0.05) (0.59)
RATIO OF
RATIO OF EXPENSES TO
NET ASSET NET ASSETS RATIO OF NET INVESTMENT AVERAGE NET ASSETS
VALUE END TOTAL END OF EXPENSES TO INCOME (LOSS) TO (EXCLUDING WAIVERS
OF PERIOD RETURN (A) PERIOD (000) AVERAGE NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS)
--------- ---------- ------------ ------------------ ------------------ -------------------
VALUE INCOME STOCK FUND
Trust Shares
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $13.71 22.18% $1,488,062 0.91% 2.40% 0.91%
1996 13.15 27.91% 1,244,399 0.92% 2.86% 0.92%
1995 11.59 19.06% 991,977 0.95% 3.16% 0.95%
1994 10.54 9.95% 573,082 0.88% 3.21% 0.97%
1993(1) 10.23 9.05%* 137,761 0.80%* 4.32%* 0.96%*
Investor Shares
1997 $13.68 21.69% $ 165,999 1.30% 2.01% 1.31%
1996 13.13 27.39% 130,597 1.30% 2.47% 1.37%
1995 11.58 18.71% 92,256 1.30% 2.80% 1.41%
1994 10.52 9.27% 60,589 1.25% 2.80% 1.44%
1993(2) 10.23 19.42%* 24,779 1.15%* 4.51%* 1.63%*
Flex Shares
1997 $13.61 20.91% $ 73,466 2.00% 1.33% 2.03%
1996(3) 13.08 26.52%* 26,298 2.00%* 1.72%* 2.15%*
MID-CAP EQUITY FUND (B)
Trust Shares
1997 $13.21 14.23% $ 287,370 1.15% 0.23% 1.26%
1996 12.76 25.54% 253,905 1.15% 0.70% 1.29%
1995 11.00 12.56% 125,562 1.15% 0.88% 1.32%
1994(4) 9.85 (1.39%)+ 57,036 1.15%* 1.20%* 1.68%*
Investor Shares
1997 $13.17 13.76% $ 20,245 1.60% (0.21%) 1.85%
1996 12.74 24.93% 17,971 1.60% 0.25% 1.96%
1995 10.99 11.96% 7,345 1.60% 0.43% 2.27%
1994(5) 9.84 (1.60%)+ 3,004 1.60%* 0.74%* 4.60%*
Flex Shares
1997 $13.04 13.06% $ 10,120 2.20% (0.85%) 2.58%
1996(6) 12.69 23.00%* 5,029 2.20%* (0.37%)* 3.04%*
SMALL CAP EQUITY FUND
Trust Shares
1997(7) $11.07 10.97%+ $ 131,049 1.20%* 1.86%* 1.37%*
CAPITAL GROWTH FUND
Trust Shares
1997 $15.09 24.66% $1,085,128 1.15% 0.83% 1.25%
1996 14.90 28.97% 981,498 1.15% 0.90% 1.27%
1995 12.18 6.63% 984,205 1.15% 1.38% 1.28%
1994 11.99 3.87% 891,870 1.15% 1.25% 1.29%
1993(8) 11.95 17.90%* 507,692 1.15%* 1.43%* 1.28%*
Investor Shares
1997 $15.06 23.74% $ 218,660 1.80% 0.19% 2.02%
1996 14.89 28.18% 191,078 1.80% 0.24% 2.08%
1995 12.17 5.93% 160,875 1.80% 0.73% 2.10%
1994 11.98 3.26% 170,795 1.80% 0.64% 2.11%
1993(9) 11.93 20.49%* 131,858 1.80%* 0.81%* 2.06%*
Flex Shares
1997 $14.96 23.24% $ 36,753 2.27% (0.29%) 2.43%
1996(3) 14.84 27.48%* 10,969 2.27%* (0.29%)* 2.68%*
RATIO OF
NET INVESTMENT
INCOME (LOSS) TO
AVERAGE NET ASSETS PORTFOLIO AVERAGE
(EXCLUDING WAIVERS TURNOVER COMMISSION
AND REIMBURSEMENTS) RATE RATE**
------------------- --------- ----------
VALUE INCOME STOCK FUND
Trust Shares
<S> <C> <C> <C> <C>
1997 2.40% 105.03% $0.0609
1996 2.86% 133.99% n/a
1995 3.16% 125.71% n/a
1994 3.12% 149.28% n/a
1993(1) 4.16%* 34.71% n/a
Investor Shares
1997 2.00% 105.03% $0.0609
1996 2.40% 133.99% n/a
1995 2.69% 125.71% n/a
1994 2.61% 149.28% n/a
1993(2) 4.04%* 34.71% n/a
Flex Shares
1997 1.30% 105.03% $0.0609
1996(3) 1.57%* 133.99% n/a
MID-CAP EQUITY FUND (B)
Trust Shares
1997 0.12% 151.68% $0.0587
1996 0.56% 115.62% n/a
1995 0.71% 65.63% n/a
1994(4) 0.67%* 7.99% n/a
Investor Shares
1997 (0.46%) 151.68% $0.0587
1996 (0.11%) 115.62% n/a
1995 (0.24%) 65.63% n/a
1994(5) (2.26%)* 7.99% n/a
Flex Shares
1997 (1.23%) 151.68% $0.0587
1996(6) (1.21%)* 115.62% n/a
SMALL CAP EQUITY FUND
Trust Shares
1997(7) 1.69%* 27.46% $0.0523
CAPITAL GROWTH FUND
Trust Shares
1997 0.73% 141.32% $0.0620
1996 0.78% 156.46% n/a
1995 1.25% 127.79% n/a
1994 1.11% 123.87% n/a
1993(8) 1.30%* 95.02% n/a
Investor Shares
1997 (0.03%) 141.32% $0.0620
1996 (0.04%) 156.46% n/a
1995 0.43% 127.79% n/a
1994 0.33% 123.87% n/a
1993(9) 0.55%* 95.02% n/a
Flex Shares
1997 (0.45%) 141.32% $0.0620
1996(3) (0.70%)* 156.46% n/a
<FN>
* Annualized.
** Average commission rate paid per share for security purchases and sales
during the period. Presentation of the rate is only required for fiscal
years beginning after September 1, 1995.
+ Returns are for the period indicated and have not been annualized.
(1) Commenced operations on February 12, 1993.
(2) Commenced operations on February 17, 1993.
(3) Commenced operations on June 1, 1995.
(4) Commenced operations on February 2, 1994.
(5) Commenced operations on February 1, 1994.
(6) Commenced operations on June 5, 1995.
(7) Commenced operations on January 31, 1997
(8) Commenced operations on July 1, 1992.
(9) Commenced operations on June 9, 1992.
(A) Total return figures do not reflect applicable sales loads.
(B) During the fiscal year ended May 31, 1996, the Aggressive Growth Fund
changed its name to the Mid-Cap Equity Fund.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS
122 & 123
<PAGE>
FINANCIAL HIGHLIGHTS (continued)
================================================================================
STI CLASSIC FUNDS FOR THE PERIOD FROM INCEPTION THROUGH MAY 31, 1997
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
NET REALIZED AND
NET UNREALIZED GAINS
NET ASSET VALUE INVESTMENT (LOSSES) DISTRIBUTIONS FROM DISTRIBUTIONS FROM
BEGINNING OF PERIOD INCOME (LOSS) ON INVESTMENTS NET INVESTMENT INCOME REALIZED CAPITAL GAINS
------------------- ------------- ---------------- --------------------- ----------------------
BALANCED FUND
Trust Shares
<S> <C> <C> <C> <C> <C> <C>
1997 $11.55 $ 0.33 $ 1.47 $ (0.32) $(1.09)
1996 10.26 0.33 1.41 (0.34) (0.11)
1995 9.76 0.33 0.49 (0.32) --
1994(1) 10.00 0.11 (0.29) (0.06) --
Investor Shares
1997 $11.60 $ 0.29 $ 1.48 $ (0.29) $(1.09)
1996 10.30 0.30 1.41 (0.30) (0.11)
1995 9.79 0.28 0.51 (0.28) --
1994(2) 10.00 0.03 (0.24) -- --
Flex Shares
1997 $11.53 $ 0.22 $ 1.45 $ (0.21) $(1.09)
1996(3) 10.36 0.24 1.29 (0.25) (0.11)
EMERGING MARKETS EQUITY FUND
Trust Shares
1997(4) $10.00 $ 0.04 $ 0.75 $ -- $ --
INTERNATIONAL EQUITY INDEX FUND
Trust Shares
1997 $10.96 $ 0.10 $ 0.69 $ (0.11) $(0.30)
1996 10.24 0.10 0.84 (0.13) (0.09)
1995(5) 10.00 0.08 0.19 (0.02) (0.01)
Investor Shares
1997 $10.88 $ 0.03 $ 0.72 $ (0.07) $(0.30)
1996 10.20 0.05 0.85 (0.13) (0.09)
1995(5) 10.00 0.05 0.17 (0.01) (0.01)
Flex Shares
1997 $10.87 $(0.05) $ 0.72 $ -- $(0.30)
1996(6) 10.24 -- 0.82 (0.10) (0.09)
INTERNATIONAL EQUITY FUND
Trust Shares
1997 $11.40 $ 0.03 $ 2.57 $ (0.02) $(0.35)
1996(7) 10.00 0.05 1.35 -- --
Investor Shares
1997 $11.38 $(0.01) $ 2.56 $ -- $(0.35)
1996(8) 10.44 0.04 0.90 -- --
Flex Shares
1997 $11.37 $(0.04) $ 2.49 $ -- $(0.35)
1996(8) 10.44 0.02 0.91 -- --
SUNBELT EQUITY FUND
Trust Shares
1997 $14.11 $(0.09) $ 0.25 $ -- $(0.99)
1996 10.03 (0.04) 4.32 -- (0.20)
1995 9.70 (0.01) 0.38 -- (0.04)
1994(1) 10.00 -- (0.30) -- --
Investor Shares
1997 $13.95 $(0.14) $ 0.24 $ -- $(0.99)
1996 9.96 (0.11) 4.30 -- (0.20)
1995 9.69 (0.05) 0.36 -- (0.04)
1994(2) 10.00 (0.02) (0.29) -- --
Flex Shares
1997 $13.97 $(0.14) $ 0.16 $ -- $(0.99)
1996(9) 10.20 (0.07) 4.04 -- (0.20)
RATIO OF
RATIO OF EXPENSES TO
NET ASSET NET ASSETS RATIO OF NET INVESTMENT AVERAGE NET ASSETS
VALUE END TOTAL END OF EXPENSES TO INCOME (LOSS) TO (EXCLUDING WAIVERS
OF PERIOD RETURN (A) PERIOD (000) AVERAGE NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS)
--------- ---------- ------------ ------------------ ------------------ -------------------
BALANCED FUND
Trust Shares
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $11.94 16.66% $ 151,358 0.95% 2.89% 1.08%
1996 11.55 17.26% 111,638 0.95% 3.00% 1.09%
1995 10.26 8.72% 89,051 0.95% 3.44% 1.11%
1994(1) 9.76 (1.78%)+ 90,579 0.95%* 2.76%* 1.25%*
Investor Shares
1997 $11.99 16.27% $ 6,012 1.25% 2.58% 1.64%
1996 11.60 16.88% 4,896 1.25% 2.70% 1.89%
1995 10.30 8.29% 3,765 1.25% 3.17% 1.80%
1994(2) 9.79 (2.10%)+ 2,311 1.25%* 2.46%* 4.91%*
Flex Shares
1997 $11.90 15.40% $ 6,067 2.01% 1.84% 2.45%
1996(3) 11.53 15.58%* 3,131 2.00%* 1.85%* 2.97%*
EMERGING MARKETS EQUITY FUND
Trust Shares
1997(4) $10.79 7.90%+ $ 39,495 1.55%* 1.37%* 2.04%*
INTERNATIONAL EQUITY INDEX FUND
Trust Shares
1997 $11.34 7.48% $ 53,516 1.05% 0.71% 1.15%
1996 10.96 9.29% 90,980 1.05% 0.84% 1.19%
1995(5) 10.24 2.69%+ 89,446 1.05%* 1.13%* 1.31%*
Investor Shares
1997 $11.26 7.12% $ 5,592 1.45% 0.28% 1.88%
1996 10.88 8.90% 5,597 1.45% 0.48% 2.06%
1995(5) 10.20 2.18%+ 3,960 1.45%* 0.67%* 2.44%*
Flex Shares
1997 $11.24 6.41% $ 900 2.10% (0.39%) 3.69%
1996(6) 10.87 8.32%+ 917 2.10%* (0.24%)* 4.14%*
INTERNATIONAL EQUITY FUND
Trust Shares
1997 $13.63 23.29% $489,325 1.46% 0.51% 1.51%
1996(7) 11.40 14.00%+ 213,306 1.46%* 1.36%* 1.65%*
Investor Shares
1997 $13.58 22.85% $ 10,674 1.81% 0.18% 2.05%
1996(8) 11.38 9.00%+ 3,448 1.81%* 1.73%* 3.14%*
Flex Shares
1997 $13.47 21.98% $ 8,375 2.51% (0.27%) 3.03%
1996(8) 11.37 8.91%+ 953 2.51%* 1.08%* 5.86%*
SUNBELT EQUITY FUND
Trust Shares
1997 $13.28 1.48% $ 381,371 1.15% (0.65%) 1.26%
1996 14.11 43.19% 412,430 1.15% (0.34%) 1.28%
1995 10.03 3.81% 258,908 1.15% (0.12%) 1.30%
1994(1) 9.70 (2.99%)+ 128,280 1.15%* (0.19%)* 1.58%*
Investor Shares
1997 $13.06 1.05% $ 28,095 1.60% (1.10%) 1.84%
1996 13.95 42.58% 29,002 1.60% (0.79%) 1.93%
1995 9.96 3.20% 22,180 1.60% (0.57%) 1.98%
1994(2) 9.69 (3.10%)+ 16,077 1.60%* (0.63%)* 2.04%*
Flex Shares
1997 $13.00 0.46% $ 5,689 2.20% (1.72%) 2.69%
1996(9) 13.97 39.86%* 2,705 2.20%* (1.43%)* 3.62%*
RATIO OF
NET INVESTMENT
INCOME (LOSS) TO
AVERAGE NET ASSETS PORTFOLIO AVERAGE
(EXCLUDING WAIVERS TURNOVER COMMISSION
AND REIMBURSEMENTS) RATE RATE**
------------------- --------- ----------
BALANCED FUND
Trust Shares
<S> <C> <C> <C> <C>
1997 2.76% 196.73% $0.0608
1996 2.86% 154.63% n/a
1995 3.28% 156.61% n/a
1994(1) 2.46%* 105.65% n/a
Investor Shares
1997 2.19% 196.73% $0.0608
1996 2.06% 154.63% n/a
1995 2.62% 156.61% n/a
1994(2) (1.20%)* 105.65% n/a
Flex Shares
1997 1.40% 196.73% $0.0608
1996(3) 0.88%* 154.63% n/a
EMERGING MARKETS EQUITY FUND
Trust Shares
1997(4) 0.88%* 23.88% $0.0019
INTERNATIONAL EQUITY INDEX FUND
Trust Shares
1997 0.61% 1.82% $0.0244
1996 0.70% 30.46% n/a
1995(5) 0.87%* 10.37% n/a
Investor Shares
1997 (0.15%) 1.82% $0.0244
1996 (0.13%) 30.46% n/a
1995(5) (0.32%)* 10.37% n/a
Flex Shares
1997 (1.98%) 1.82% $0.0244
1996(6) (2.28%)* 30.46% n/a
INTERNATIONAL EQUITY FUND
Trust Shares
1997 0.46% 139.37% $0.0313
1996(7) 1.17%* 113.34% n/a
Investor Shares
1997 (0.06%) 139.37% $0.0313
1996(8) 0.40%* 113.34% n/a
Flex Shares
1997 (0.79%) 139.37% $0.0313
1996(8) (2.27%)* 113.34% n/a
SUNBELT EQUITY FUND
Trust Shares
1997 (0.76%) 72.17% $0.0674
1996 (0.47%) 106.27% n/a
1995 (0.27%) 80.03% n/a
1994(1) (0.62%)* 21.42% n/a
Investor Shares
1997 (1.34%) 72.17% $0.0674
1996 (1.12%) 106.27% n/a
1995 (0.95%) 80.03% n/a
1994(2) (1.07%)* 21.42% n/a
Flex Shares
1997 (2.21%) 72.17% $0.0674
1996(9) (2.85%)* 106.27% n/a
<FN>
* Annualized.
** Average commission rate paid per share for security purchases and sales
during the period. Presentation of the rate is only required for fiscal
years beginning after September 1, 1995.
+ Returns are for the period indicated and have not been annualized.
(1) Commenced operations on January 3, 1994.
(2) Commenced operations on January 4, 1994.
(3) Commenced operations on June 14, 1995.
(4) Commenced operations on January 31, 1997.
(5) Commenced operations on June 6, 1994.
(6) Commenced operations on June 8, 1995.
(7) Commenced operations on December 1, 1995.
(8) Commenced operations on January 2, 1996.
(9) Commenced operations on June 5, 1995.
(A) Total return figures do not reflect applicable sales loads.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
124 & 125
<PAGE>
FINANCIAL HIGHLIGHTS (continued)
================================================================================
STI CLASSIC FUNDS FOR THE PERIOD FROM INCEPTION THROUGH MAY 31, 1997
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
NET REALIZED AND
NET UNREALIZED GAINS
NET ASSET VALUE INVESTMENT (LOSSES) DISTRIBUTIONS FROM DISTRIBUTIONS FROM
BEGINNING OF PERIOD INCOME (LOSS) ON INVESTMENTS NET INVESTMENT INCOME REALIZED CAPITAL GAINS
------------------- ------------- ---------------- --------------------- ----------------------
INVESTMENT GRADE TAX-EXEMPT BOND FUND
Trust Shares
<S> <C> <C> <C> <C> <C> <C>
1997 $11.10 $ 0.44 $ 0.33 $(0.44) $(0.21)
1996 11.28 0.45 0.19 (0.45) (0.37)
1995 10.68 0.46 0.60 (0.46) --
1994(1) 11.37 0.22 (0.34) (0.22) (0.35)
Investor Shares
1997 $11.12 $ 0.40 $ 0.33 $(0.40) $(0.21)
1996 11.30 0.41 0.19 (0.41) (0.37)
1995 10.69 0.42 0.61 (0.42) --
1994 10.79 0.33 0.25 (0.33) (0.35)
1993(2) 10.00 0.35 0.82 (0.35) (0.03)
Flex Shares
1997 $11.11 $ 0.35 $ 0.33 $(0.35) $(0.21)
1996(3) 11.30 0.37 0.18 (0.37) (0.37)
FLORIDA TAX-EXEMPT BOND FUND
Trust Shares
1997 $10.06 $ 0.46 $ 0.25 $(0.46) $(0.03)
1996 10.18 0.46 (0.07) (0.46) (0.05)
1995 9.75 0.44 0.43 (0.44) --
1994(4) 10.00 0.13 (0.25) (0.13) --
Investor Shares
1997 $10.07 $ 0.44 $ 0.25 $(0.44) $(0.03)
1996 10.18 0.44 (0.06) (0.44) (0.05)
1995 9.75 0.42 0.43 (0.42) --
1994(5) 10.00 0.13 (0.25) (0.13) --
Flex Shares
1997 $10.08 $ 0.39 $ 0.25 $(0.39) $(0.03)
1996(3) 10.19 0.39 (0.06) (0.39) (0.05)
TENNESSEE TAX-EXEMPT BOND FUND
Trust Shares
1997 $ 9.40 $ 0.43 $ 0.23 $(0.43) $ --
1996 9.50 0.43 (0.11) (0.42) --
1995 9.22 0.44 0.28 (0.44) --
1994(6) 10.00 0.12 (0.77) (0.13) --
Investor Shares
1997 $ 9.42 $ 0.41 $ 0.23 $(0.41) $ --
1996 9.53 0.41 (0.10) (0.42) --
1995 9.23 0.44 0.29 (0.43) --
1994(7) 10.00 0.13 (0.77) (0.13) --
Flex Shares
1997 $ 9.41 $ 0.37 $ 0.23 $(0.37) $ --
1996(8) 9.59 0.37 (0.18) (0.37) --
GEORGIA TAX-EXEMPT BOND FUND
Trust Shares
1997 $ 9.56 $ 0.42 $ 0.22 $(0.42) $(0.05)
1996 9.63 0.43 (0.05) (0.43) (0.02)
1995 9.42 0.42 0.21 (0.42) --
1994(5) 10.00 0.14 (0.58) (0.14) --
Investor Shares
1997 $ 9.58 $ 0.40 $ 0.21 $(0.40) $(0.05)
1996 9.65 0.41 (0.05) (0.41) (0.02)
1995 9.44 0.40 0.21 (0.40) --
1994(7) 10.00 0.13 (0.56) (0.13) --
Flex Shares
1997 $ 9.56 $ 0.35 $ 0.22 $(0.35) $(0.05)
1996(9) 9.72 0.36 (0.14) (0.36) (0.02)
RATIO OF
RATIO OF EXPENSES TO
NET ASSET NET ASSETS RATIO OF NET INVESTMENT AVERAGE NET ASSETS
VALUE END TOTAL END OF EXPENSES TO INCOME TO (EXCLUDING WAIVERS
OF PERIOD RETURN (A) PERIOD (000) AVERAGE NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS)
--------- ---------- ------------ ------------------ ------------------ -------------------
INVESTMENT GRADE TAX-EXEMPT BOND FUND
Trust Shares
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $11.22 7.13% $139,144 0.75% 3.96% 0.86%
1996 11.10 5.82% 124,507 0.75% 4.01% 0.89%
1995 11.28 10.21% 78,208 0.75% 4.34% 0.91%
1994(1) 10.68 (1.10%)+ 44,595 0.75%* 3.46%* 0.95%*
Investor Shares
1997 $11.24 6.69% $ 31,857 1.15% 3.56% 1.38%
1996 11.12 5.40% 37,427 1.15% 3.61% 1.42%
1995 11.30 9.91% 41,693 1.15% 3.88% 1.43%
1994 10.69 5.37% 46,182 1.14% 2.96% 1.51%
1993(2) 10.79 11.88%* 15,844 1.12%* 3.61%* 1.83%*
Flex Shares
1997 $11.23 6.19% $ 4,681 1.63% 3.08% 2.15%
1996(3) 11.11 4.91%* 5,536 1.63%* 3.12%* 2.25%*
FLORIDA TAX-EXEMPT BOND FUND
Trust Shares
1997 $10.28 7.22% $ 50,487 0.65% 4.48% 0.80%
1996 10.06 3.87% 30,790 0.65% 4.49% 0.88%
1995 10.18 9.26% 10,118 0.65% 4.63% 1.13%
1994(4) 9.75 (1.19%)+ 3,192 0.65%* 3.86%* 1.12%*
Investor Shares
1997 $10.29 7.00% $ 3,226 0.85% 4.28% 1.31%
1996 10.07 3.76% 4,025 0.85% 4.28% 1.36%
1995 10.18 9.04% 3,320 0.85% 4.36% 1.50%
1994(5) 9.75 (1.22%)+ 2,280 0.85%* 3.67%* 3.20%*
Flex Shares
1997 $10.30 6.48% $ 3,000 1.35% 3.78% 2.28%
1996(3) 10.08 3.27%* 2,692 1.35%* 3.79%* 2.54%*
TENNESSEE TAX-EXEMPT BOND FUND
Trust Shares
1997 $ 9.63 7.16% $ 1,973 0.65% 4.51% 1.72%
1996 9.40 3.43% 1,823 0.65% 4.49% 1.68%
1995 9.50 8.17% 1,664 0.65% 4.90% 2.65%
1994(6) 9.22 (6.52%)+ 594 0.65%* 4.24%* 1.43%*
Investor Shares
1997 $ 9.65 6.93% $ 1,602 0.85% 4.31% 1.76%
1996 9.42 3.28% 1,523 0.85% 4.29% 2.08%
1995 9.53 8.24% 1,170 0.85% 4.70% 2.10%
1994(7) 9.23 (6.39%)+ 1,127 0.85%* 3.74%* 6.60%*
Flex Shares
1997 $ 9.64 6.42% $ 2,505 1.35% 3.81% 2.34%
1996(8) 9.41 1.98%* 2,017 1.34%* 3.80%* 2.74%*
GEORGIA TAX-EXEMPT BOND FUND
Trust Shares
1997 $ 9.73 6.79% $ 39,732 0.65% 4.31% 0.81%
1996 9.56 3.89% 22,950 0.65% 4.36% 0.89%
1995 9.63 6.94% 13,187 0.65% 4.56% 0.98%
1994(5) 9.42 (4.43%)+ 4,338 0.65%* 4.12%* 1.06%*
Investor Shares
1997 $ 9.74 6.47% $ 3,511 0.85% 4.10% 1.33%
1996 9.58 3.69% 3,418 0.85% 4.17% 1.41%
1995 9.65 6.70% 3,268 0.85% 4.31% 1.43%
1994(7) 9.44 (4.29%)+ 3,300 0.85%* 3.93%* 2.36%*
Flex Shares
1997 $ 9.73 6.06% $ 4,662 1.35% 3.60% 2.07%
1996(9) 9.56 2.25%* 4,207 1.35%* 3.66%* 2.35%*
RATIO OF
NET INVESTMENT
INCOME (LOSS) TO
AVERAGE NET ASSETS PORTFOLIO
(EXCLUDING WAIVERS TURNOVER
AND REIMBURSEMENTS) RATE
------------------- ---------
INVESTMENT GRADE TAX-EXEMPT BOND FUND
Trust Shares
<S> <C> <C> <C>
1997 3.85% 489.02%
1996 3.87% 513.90%
1995 4.18% 591.91%
1994(1) 3.26%* 432.46%
Investor Shares
1997 3.33% 489.02%
1996 3.34% 513.90%
1995 3.60% 591.91%
1994 2.59% 432.46%
1993(2) 2.90%* 344.87%
Flex Shares
1997 2.56% 489.02%
1996(3) 2.50%* 513.90%
FLORIDA TAX-EXEMPT BOND FUND
Trust Shares
1997 4.33% 134.62%
1996 4.26% 62.68%
1995 4.15% 105.01%
1994(4) 3.39%* 53.24%
Investor Shares
1997 3.82% 134.62%
1996 3.77% 62.68%
1995 3.71% 105.01%
1994(5) 1.32%* 53.24%
Flex Shares
1997 2.85% 134.62%
1996(3) 2.60%* 62.68%
TENNESSEE TAX-EXEMPT BOND FUND
Trust Shares
1997 3.44% 16.09%
1996 3.46% 41.00%
1995 2.90% 27.73%
1994(6) 3.46%* 13.05%
Investor Shares
1997 3.40% 16.09%
1996 3.06% 41.00%
1995 3.45% 27.73%
1994(7) (2.01%)* 13.05%
Flex Shares
1997 2.82% 16.09%
1996(8) 2.40%* 41.00%
GEORGIA TAX-EXEMPT BOND FUND
Trust Shares
1997 4.15% 14.81%
1996 4.12% 60.02%
1995 4.23% 24.50%
1994(5) 3.71%* 25.90%
Investor Shares
1997 3.62% 14.81%
1996 3.61% 60.02%
1995 3.73% 24.50%
1994(7) 2.42%* 25.90%
Flex Shares
1997 2.88% 14.81%
1996(9) 2.66%* 60.02%
<FN>
* Annualized.
+ Returns are for the period indicated and have not been annualized.
(1) Commenced operations on October 21, 1993
(2) Commenced operations on June 9, 1992.
(3) Commenced operations on June 1, 1995.
(4) Commenced operations on January 25, 1994.
(5) Commenced operations on January 18, 1994.
(6) Commenced operations on January 27, 1994.
(7) Commenced operations on January 19, 1994.
(8) Commenced operations on June 5, 1995.
(9) Commenced operations on June 6, 1995.
(A) Total return figures do not reflect applicable sales loads.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
126 & 127
<PAGE>
FINANCIAL HIGHLIGHTS (continued)
===============================================================================
STI CLASSIC FUNDS FOR THE PERIOD FROM INCEPTION THROUGH MAY 31, 1997
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
NET REALIZED AND
NET UNREALIZED GAINS
NET ASSET VALUE INVESTMENT (LOSSES) DISTRIBUTIONS FROM DISTRIBUTIONS FROM
BEGINNING OF PERIOD INCOME (LOSS) ON INVESTMENTS NET INVESTMENT INCOME REALIZED CAPITAL GAINS
------------------- ------------- ---------------- --------------------- ----------------------
INVESTMENT GRADE BOND FUND
Trust Shares
<S> <C> <C> <C> <C> <C> <C>
1997 $10.07 $ 0.60 $ 0.09 $(0.60) $ --
1996 10.26 0.60 (0.19) (0.60) --
1995 9.89 0.61 0.37 (0.61) --
1994 10.45 0.50 (0.36) (0.50) (0.20)
1993(1) 10.09 0.45 0.36 (0.45) --
Investor Shares
1997 $10.06 $ 0.56 $ 0.10 $(0.56) $ --
1996 10.26 0.56 (0.20) (0.56) --
1995 9.89 0.57 0.38 (0.58) --
1994 10.44 0.46 (0.35) (0.46) (0.20)
1993(2) 10.00 0.44 0.44 (0.44) --
Flex Shares
1997 $10.07 $ 0.51 $ 0.10 $(0.51) $ --
1996(3) 10.33 0.52 (0.26) (0.52) --
SHORT-TERM BOND FUND
Trust Shares
1997 $ 9.86 $ 0.53 $ 0.07 $(0.53) $(0.03)
1996 9.98 0.54 (0.10) (0.54) (0.02)
1995 9.79 0.53 0.19 (0.53) --
1994 10.01 0.42 (0.21) (0.42) (0.01)
1993(4) 10.00 0.08 0.01 (0.08) --
Investor Shares
1997 $ 9.88 $ 0.51 $ 0.06 $(0.51) $(0.03)
1996 10.01 0.52 (0.10) (0.53) (0.02)
1995 9.81 0.51 0.19 (0.50) --
1994 10.03 0.40 (0.21) (0.40) (0.01)
1993(5) 10.06 0.06 (0.03) (0.06) --
Flex Shares
1997 $ 9.88 $ 0.48 $ 0.06 $(0.48) $(0.03)
1996(6) 10.02 0.47 (0.12) (0.47) (0.02)
SHORT-TERM U.S. TREASURY SECURITIES FUND
Trust Shares
1997 $ 9.84 $ 0.51 $ 0.04 $(0.51) $ --
1996 9.93 0.55 (0.09) (0.55) --
1995 9.82 0.47 0.11 (0.47) --
1994 9.98 0.33 (0.11) (0.33) (0.05)
1993(4) 10.00 0.07 (0.02) (0.07) --
Investor Shares
1997 $ 9.84 $ 0.50 $ 0.04 $(0.50) $ --
1996 9.94 0.54 (0.10) (0.54) --
1995 9.83 0.46 0.11 (0.46) --
1994 9.99 0.32 (0.12) (0.31) (0.05)
1993(7) 10.01 0.06 (0.02) (0.06) --
Flex Shares
1997 $ 9.82 $ 0.47 $ 0.03 $(0.47) $ --
1996(8) 9.96 0.48 (0.14) (0.48) --
LIMITED-TERM FEDERAL MORTGAGE SECURITIES FUND
Trust Shares
1997 $ 9.99 $ 0.58 $ 0.04 $(0.58) $(0.01)
1996 10.11 0.62 (0.14) (0.60) --
1995(9) 10.00 0.58 0.13 (0.60) --
Investor Shares
1997 $ 9.97 $ 0.56 $ 0.04 $(0.56) $(0.01)
1996 10.11 0.60 (0.14) (0.60) --
1995(10) 9.98 0.58 0.13 (0.58) --
Flex Shares
1997 $ 9.99 $ 0.52 $ 0.04 $(0.52) $(0.01)
1996(3) 10.14 0.55 (0.15) (0.55) --
RATIO OF
RATIO OF EXPENSES TO
NET ASSET NET ASSETS RATIO OF NET INVESTMENT AVERAGE NET ASSETS
VALUE END TOTAL END OF EXPENSES TO INCOME TO (EXCLUDING WAIVERS
OF PERIOD RETURN (A) PERIOD (000) AVERAGE NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS)
--------- ---------- ------------ ------------------ ------------------ -------------------
INVESTMENT GRADE BOND FUND
Trust Shares
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $10.16 6.99% $633,646 0.75% 5.89% 0.85%
1996 10.07 4.02% 599,514 0.75% 5.81% 0.87%
1995 10.26 10.39% 543,308 0.75% 6.22% 0.88%
1994 9.89 1.17% 460,538 0.75% 4.77% 0.88%
1993(1) 10.45 9.34%* 336,132 0.74%* 5.14%* 0.87%*
Investor Shares
1997 $10.16 6.66% $ 33,165 1.15% 5.48% 1.41%
1996 10.06 3.50% 36,155 1.15% 5.40% 1.44%
1995 10.26 10.04% 33,772 1.15% 5.79% 1.49%
1994 9.89 0.86% 35,775 1.14% 4.39% 1.41%
1993(2) 10.44 9.21%* 24,375 1.14%* 4.75%* 1.46%*
Flex Shares
1997 $10.17 6.16% $ 5,763 1.64% 5.00% 2.20%
1996(3) 10.07 2.50%* 4,621 1.64%* 4.84%* 2.49%*
SHORT-TERM BOND FUND
Trust Shares
1997 $ 9.90 6.30% $ 89,701 0.65% 5.37% 0.78%
1996 9.86 4.45% 91,156 0.65% 5.39% 0.81%
1995 9.98 7.60% 60,952 0.65% 5.49% 0.85%
1994 9.79 2.02% 34,772 0.65% 4.15% 0.85%
1993(4) 10.01 4.45%* 25,334 0.64%* 3.88%* 1.11%*
Investor Shares
1997 $ 9.91 5.97% $ 2,182 0.85% 5.16% 1.58%
1996 9.88 4.23% 2,700 0.85% 5.20% 1.72%
1995 10.01 7.44% 2,609 0.85% 5.24% 1.56%
1994 9.81 1.81% 2,381 0.85% 3.94% 2.52%
1993(5) 10.03 1.65%* 716 0.85%* 3.85%* 7.22%*
Flex Shares
1997 $ 9.91 5.62% $ 1,073 1.20% 4.82% 3.02%
1996(6) 9.88 3.73%* 966 1.20%* 4.77%* 4.06%*
SHORT-TERM U.S. TREASURY SECURITIES FUND
Trust Shares
1997 $ 9.88 5.76% $ 21,988 0.65% 5.23% 0.92%
1996 9.84 4.73% 10,149 0.65% 5.56% 1.00%
1995 9.93 6.11% 9,599 0.65% 4.91% 1.08%
1994 9.82 2.17% 12,723 0.65% 3.23% 0.81%
1993(4) 9.98 2.22%* 30,336 0.63%* 3.34%* 1.04%*
Investor Shares
1997 $ 9.88 5.59% $ 3,921 0.80% 5.05% 1.35%
1996 9.84 4.52% 4,192 0.80% 5.43% 1.32%
1995 9.94 6.03% 7,144 0.80% 4.74% 1.33%
1994 9.83 2.01% 4,841 0.78% 3.11% 1.41%
1993(7) 9.99 1.84%* 2,423 0.80%* 3.16%* 3.42%*
Flex Shares
1997 $ 9.85 5.19% $ 1,091 1.05% 4.75% 2.51%
1996(8) 9.82 3.72%* 2,423 1.05%* 5.03%* 2.97%*
LIMITED-TERM FEDERAL MORTGAGE SECURITIES FUND
Trust Shares
1997 $10.02 6.43% $123,903 0.65% 5.81% 0.78%
1996 9.99 4.84% 73,370 0.65% 6.04% 0.84%
1995(9) 10.11 7.50%+ 41,823 0.65%* 6.43%* 0.93%*
Investor Shares
1997 $10.00 6.17% $ 2,426 0.90% 5.55% 1.48%
1996 9.97 4.59% 2,512 0.90% 5.75% 2.25%
1995(10) 10.11 7.45%+ 623 0.90%* 6.27%* 7.74%*
Flex Shares
1997 $10.02 5.80% $ 1,409 1.25% 5.20% 2.66%
1996(3) 9.99 4.10%* 1,349 1.25%* 5.38%* 3.59%*
NET INVESTMENT
INCOME (LOSS) TO
AVERAGE NET ASSETS PORTFOLIO
(EXCLUDING WAIVERS TURNOVER
AND REIMBURSEMENTS) RATE
------------------- ---------
INVESTMENT GRADE BOND FUND
Trust Shares
<S> <C> <C> <C>
1997 5.79% 297.82%
1996 5.69% 184.33%
1995 6.09% 237.66%
1994 4.64% 259.19%
1993(1) 5.01%* 299.32%
Investor Shares
1997 5.22% 297.82%
1996 5.11% 184.33%
1995 5.45% 237.66%
1994 4.12% 259.19%
1993(2) 4.43%* 299.32%
Flex Shares
1997 4.44% 297.82%
1996(3) 3.99%* 184.33%
SHORT-TERM BOND FUND
Trust Shares
1997 5.24% 117.83%
1996 5.23% 162.62%
1995 5.29% 200.49%
1994 3.95% 74.85%
1993(4) 3.41%* 63.89%
Investor Shares
1997 4.43% 117.83%
1996 4.33% 162.62%
1995 4.53% 200.49%
1994 2.27% 74.85%
1993(5) (2.52%)* 63.89%
Flex Shares
1997 3.00% 117.83%
1996(6) 1.91%* 162.62%
SHORT-TERM U.S. TREASURY SECURITIES FUND
Trust Shares
1997 4.96% 92.89%
1996 5.21% 94.00%
1995 4.48% 87.98%
1994 3.07% 116.57%
1993(4) 2.93%* 36.44%
Investor Shares
1997 4.50% 92.89%
1996 4.91% 94.00%
1995 4.21% 87.98%
1994 2.48% 116.57%
1993(7) 0.54%* 36.44%
Flex Shares
1997 3.29% 92.89%
1996(8) 3.11%* 94.00%
LIMITED-TERM FEDERAL MORTGAGE SECURITIES FUND
Trust Shares
1997 5.68% 133.45%
1996 5.85% 83.01%
1995(9) 6.15%* 67.63%
Investor Shares
1997 4.97% 133.45%
1996 4.40% 83.01%
1995(10) (0.57%)* 67.63%
Flex Shares
1997 3.79% 133.45%
1996(3) 3.04%* 83.01%
<FN>
* Annualized.
+ Returns are for the period indicated and have not been annualized.
(1) Commenced operations on July 16, 1992.
(2) Commenced operations on June 11, 1992.
(3) Commenced operations on June 7, 1995.
(4) Commenced operations on March 15, 1993.
(5) Commenced operations on March 22, 1993.
(6) Commenced operations on June 20, 1995.
(7) Commenced operations on March 18, 1993.
(8) Commenced operations on June 22, 1995.
(9) Commenced operations on June 7, 1994.
(10) Commenced operations on July 17, 1994.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
128 & 129
<PAGE>
FINANCIAL HIGHLIGHTS (concluded)
================================================================================
STI CLASSIC FUNDS FOR THE PERIOD FROM INCEPTION THROUGH MAY 31, 1997
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
NET REALIZED AND
NET UNREALIZED GAINS
NET ASSET VALUE INVESTMENT (LOSSES) DISTRIBUTIONS FROM DISTRIBUTIONS FROM
BEGINNING OF PERIOD INCOME ON INVESTMENTS NET INVESTMENT INCOME REALIZED CAPITAL GAINS
------------------- ------------- ---------------- --------------------- ----------------------
U.S. GOVERNMENT SECURITIES FUND
Trust Shares
<S> <C> <C> <C> <C> <C> <C>
1997 $ 9.91 $ 0.62 $ 0.11 $(0.62) $ --
1996 10.27 0.62 (0.33) (0.62) (0.03)
1995(1) 9.98 0.53 0.29 (0.53) --
Investor Shares
1997 $ 9.90 $ 0.58 $ 0.12 $(0.58) $ --
1996 10.26 0.59 (0.33) (0.59) (0.03)
1995(2) 10.00 0.56 0.26 (0.56) --
Flex Shares
1997 $ 9.91 $ 0.53 $ 0.11 $(0.53) $ --
1996(3) 10.31 0.52 (0.37) (0.52) (0.03)
PRIME QUALITY MONEY MARKET FUND
Trust Shares
1997 $ 1.00 $ 0.05 $ -- $(0.05) $ --
1996 1.00 0.05 -- (0.05) --
1995 1.00 0.05 -- (0.05) --
1994 1.00 0.03 -- (0.03) --
1993(4) 1.00 0.03 -- (0.03) --
Investor Shares
1997 $ 1.00 $ 0.05 $ -- $(0.05) $ --
1996 1.00 0.05 -- (0.05) --
1995 1.00 0.05 -- (0.05) --
1994 1.00 0.03 -- (0.03) --
1993(4) 1.00 0.03 -- (0.03) --
U.S. GOVERNMENT SECURITIES MONEY MARKET FUND
Trust Shares
1997 $ 1.00 $ 0.05 $ -- $(0.05) $ --
1996 1.00 0.05 -- (0.05) --
1995 1.00 0.05 -- (0.05) --
1994 1.00 0.03 -- (0.03) --
1993(4) 1.00 0.03 -- (0.03) --
Investor Shares
1997 $ 1.00 $ 0.05 $ -- $(0.05) $ --
1996 1.00 0.05 -- (0.05) --
1995 1.00 0.04 -- (0.04) --
1994 1.00 0.03 -- (0.03) --
1993(4) 1.00 0.03 -- (0.03) --
TAX-EXEMPT MONEY MARKET FUND
Trust Shares
1997 $ 1.00 $ 0.03 $ -- $(0.03) $ --
1996 1.00 0.03 -- (0.03) --
1995 1.00 0.03 -- (0.03) --
1994 1.00 0.02 -- (0.02) --
1993(4) 1.00 0.02 -- (0.02) --
Investor Shares
1997 $ 1.00 $ 0.03 $ -- $(0.03) $ --
1996 1.00 0.03 -- (0.03) --
1995 1.00 0.03 -- (0.03) --
1994 1.00 0.02 -- (0.02) --
1993(4) 1.00 0.02 -- (0.02) --
RATIO OF
RATIO OF EXPENSES TO
NET ASSET NET ASSETS RATIO OF NET INVESTMENT AVERAGE NET ASSETS
VALUE END TOTAL END OF EXPENSES TO INCOME TO (EXCLUDING WAIVERS
OF PERIOD RETURN (A) PERIOD (000) AVERAGE NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS)
--------- ---------- ------------ ------------------ ------------------ -------------------
U.S. GOVERNMENT SECURITIES FUND
Trust Shares
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $10.02 7.54% $ 19,471 0.75% 6.19% 1.02%
1996 9.91 2.77% 10,277 0.75% 6.05% 1.25%
1995(1) 10.27 8.64%+ 3,291 0.75%* 6.67%* 3.33%*
Investor Shares
1997 $10.02 7.21% $ 2,243 1.15% 5.76% 1.79%
1996 9.90 2.47% 2,396 1.15% 5.68% 2.50%
1995(2) 10.26 8.61%+ 589 1.15%* 6.08%* 6.84%*
Flex Shares
1997 $10.02 6.57% $ 2,801 1.66% 5.26% 2.42%
1996(3) 9.91 1.42%* 2,826 1.66%* 5.18%* 2.86%*
PRIME QUALITY MONEY MARKET FUND
Trust Shares
1997 $ 1.00 5.01% $1,086,555 0.58% 4.90% 0.76%
1996 1.00 5.25% 1,050,800 0.58% 5.11% 0.78%
1995 1.00 4.79% 799,189 0.58% 4.77% 0.79%
1994 1.00 2.88% 583,399 0.58% 2.86% 0.79%
1993(4) 1.00 2.92%* 410,991 0.58%* 2.85%* 0.78%*
Investor Shares
1997 $ 1.00 4.84% $ 283,544 0.75% 4.74% 0.97%
1996 1.00 5.08% 215,696 0.75% 4.94% 1.00%
1995 1.00 4.62% 157,616 0.75% 4.55% 1.01%
1994 1.00 2.71% 129,415 0.75% 2.67% 0.99%
1993(4) 1.00 2.75%* 61,578 0.75%* 2.68%* 1.02%*
U.S. GOVERNMENT SECURITIES MONEY MARKET FUND
Trust Shares
1997 $ 1.00 4.83% $ 344,350 0.61% 4.73% 0.76%
1996 1.00 5.14% 325,493 0.61% 5.02% 0.78%
1995 1.00 4.67% 434,111 0.61% 4.64% 0.80%
1994 1.00 2.77% 309,228 0.61% 2.69% 0.77%
1993(4) 1.00 2.79%* 453,567 0.61%* 2.71%* 0.78%*
Investor Shares
1997 $ 1.00 4.69% $ 63,178 0.75% 4.59% 0.96%
1996 1.00 4.99% 58,608 0.75% 4.88% 0.99%
1995 1.00 4.51% 46,639 0.75% 4.51% 1.02%
1994 1.00 2.63% 32,395 0.75% 2.54% 0.97%
1993(4) 1.00 2.65%* 16,688 0.75%* 2.57%* 1.11%*
TAX-EXEMPT MONEY MARKET FUND
Trust Shares
1997 $ 1.00 3.09% $ 333,006 0.50% 3.04% 0.66%
1996 1.00 3.28% 273,613 0.50% 3.23% 0.68%
1995 1.00 3.10% 215,413 0.45% 3.12% 0.70%
1994 1.00 2.08% 143,982 0.42% 2.05% 0.71%
1993(4) 1.00 2.12%* 78,416 0.41%* 2.07%* 0.70%*
Investor Shares
1997 $ 1.00 2.97% $ 102,013 0.62% 2.92% 0.83%
1996 1.00 3.16% 95,223 0.62% 3.10% 0.85%
1995 1.00 3.00% 87,647 0.55% 3.00% 0.87%
1994 1.00 1.96% 61,675 0.54% 1.93% 0.88%
1993(4) 1.00 2.00%* 35,209 0.53%* 1.95%* 0.95%*
RATIO OF
NET INVESTMENT
INCOME (LOSS) TO
AVERAGE NET ASSETS PORTFOLIO
(EXCLUDING WAIVERS TURNOVER
AND REIMBURSEMENTS) RATE
------------------- ---------
U.S. GOVERNMENT SECURITIES FUND
Trust Shares
<S> <C> <C> <C>
1997 5.92% 21.15%
1996 5.55% 83.38%
1995(1) 4.09%* 30.39%
Investor Shares
1997 5.12% 21.15%
1996 4.33% 83.38%
1995(2) 0.39%* 30.39%
Flex Shares
1997 4.50% 21.15%
1996(3) 3.98%* 83.38%
PRIME QUALITY MONEY MARKET FUND
Trust Shares
1997 4.72% --
1996 4.91% --
1995 4.56% --
1994 2.65% --
1993(4) 2.65%* --
Investor Shares
1997 4.52% --
1996 4.69% --
1995 4.29% --
1994 2.43% --
1993(4) 2.41%* --
U.S. GOVERNMENT SECURITIES MONEY MARKET FUND
Trust Shares
1997 4.58% --
1996 4.85% --
1995 4.45% --
1994 2.53% --
1993(4) 2.54%* --
Investor Shares
1997 4.38% --
1996 4.64% --
1995 4.24% --
1994 2.32% --
1993(4) 2.21%* --
TAX-EXEMPT MONEY MARKET FUND
Trust Shares
1997 2.88% --
1996 3.05% --
1995 2.87% --
1994 1.76% --
1993(4) 1.78%* --
Investor Shares
1997 2.71% --
1996 2.87% --
1995 2.68% --
1994 1.59% --
1993(4) 1.53%* --
<FN>
* Annualized.
+ Returns are for the period indicated and have not been annualized.
(A) Total Return figures do not reflect applicable sales loads.
(1) Commenced operations on July 31, 1994.
(2) Commenced operations on June 9, 1994.
(3) Commenced operations on June 7, 1995.
(4) Commenced operations on June 8, 1992.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
130 & 131
<PAGE>
NOTES TO FINANCIAL STATEMENTS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
1. Organization:
The STI Classic Funds (the "Trust") was organized as a Massachusetts Business
Trust under a Declaration of Trust dated January 15, 1992. The Trust is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company with twenty-three portfolios: the Value Income
Stock Fund, the Mid-Cap Equity Fund, the Small Cap Equity Fund, the Capital
Growth Fund, the Balanced Fund, the Emerging Markets Equity Fund, the
International Equity Index Fund, the International Equity Fund, the Sunbelt
Equity Fund, the Investment Grade Tax-Exempt Bond Fund, the Florida Tax-Exempt
Bond Fund, the Tennessee Tax-Exempt Bond Fund, the Georgia Tax-Exempt Bond Fund,
the Investment Grade Bond Fund, the Short-Term Bond Fund, the Short-Term U.S.
Treasury Securities Fund, the Limited-Term Federal Mortgage Securities Fund, and
the U.S. Government Securities Fund, (collectively the "Non-Dollar Funds"), the
Prime Quality Money Market Fund, the U.S. Government Securities Money Market
Fund, the Tax-Exempt Money Market Fund, the Classic Institutional Cash
Management Money Market Fund and the Classic Institutional U.S. Treasury
Securities Money Market Fund, (collectively the "Money Market Funds"). The
assets of each portfolio are segregated, and a shareholder's interest is limited
to the Fund in which shares are held. Each Fund's prospectus provides a
description of the Fund's investment objectives, policies and strategies.
2. Significant Accounting Policies:
The following is a summary of significant accounting policies followed by the
Trust.
SECURITY VALUATION -- Investment securities held by the Money Market Funds
are stated at amortized cost, which approximates market value.
Investment securities held by the Non-Dollar Funds that are listed on a
securities exchange for which market quotations are available are valued at
the last quoted sales price each business day. If there is no such reported
sale, these securities and unlisted securities for which market quotations
are readily available are valued at the most recently quoted bid price.
Foreign securities in the Emerging Markets Equity Fund, the International
Equity Fund and the International Equity Index Fund are valued based upon
quotations from the primary market in which they are traded. Debt
obligations with sixty days or less remaining until maturity may be valued
at their amortized cost.
FEDERAL INCOME TAXES -- It is each Fund's intention to qualify as a
regulated investment company for Federal income tax purposes and distribute
all of its taxable income and net capital gains. Accordingly, no provisions
for Federal income taxes are required.
SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are
accounted for on the date the security is purchased or sold (trade date).
Dividend income is recognized on the ex-dividend date and interest income
is recognized on an accrual basis. Costs used in determining net realized
gains and losses on the sales of investment securities are those of the
specific securities sold adjusted for the accretion and amortization of
purchase discounts and premiums during the respective holding period.
Purchase discounts and premiums on securities held by the Money Market
Funds are accreted and amortized ratably to maturity and are included in
interest income. Purchase discounts and premiums on securities held by the
Non-Dollar Funds are accreted and amortized to maturity using the
scientific interest method, which approximates the effective interest
method.
REPURCHASE AGREEMENTS -- Securities pledged as collateral for repurchase
agreements are held by the custodian bank until the respective agreements
mature. Provisions of the repurchase agreements ensure that the market
value of the collateral, including accrued interest thereon, is sufficient
in the event of default of the counterparty. If the counterparty defaults
and the value of the collat-
132
<PAGE>
================================================================================
eral declines or if the counterparty enters into an insolvency proceeding,
realization of the collateral by the Funds may be delayed or limited.
NET ASSET VALUE PER SHARE -- The net asset value per share of each Fund is
calculated each business day, by dividing the total value of each Fund's
assets, less liabilities, by the number of shares outstanding. The maximum
offering price per share for Investor shares of the Investment Grade Bond,
the Investment Grade Tax-Exempt Bond, the Capital Growth, the Value Income
Stock, the Sunbelt Equity, the Mid-Cap Equity, the Balanced, the Florida
Tax-Exempt Bond, the Georgia Tax-Exempt Bond, the Tennessee Tax-Exempt
Bond, the U.S. Government Securities, the International Equity, and the
International Equity Index Funds is equal to the net asset value per share
plus a sales load of 3.75%. The maximum offering price per share for
Investor shares of the Short-Term U.S. Treasury Securities Fund is equal to
the net asset value per share plus a sales load of 1.00%. The maximum
offering price per share for Investor shares of the Short-Term Bond Fund is
equal to the net asset value per share plus a sales load of 2.00%. The
maximum offering price per share for Investor shares of the Limited-Term
Federal Mortgage Securities Fund is equal to the net asset value per share
plus a sales load of 2.50%
Flex Shares of the Funds may be purchased at their net asset value. Shares
redeemed within the first year after purchase will be subject to a
contingent deferred sales charge ("CDSC") equal to 2.00% of the net asset
value of the shares at the time of redemption. The CDSC will not apply to
shares redeemed after such time.
FOREIGN CURRENCY TRANSLATION -- The books and records of the Emerging
Markets Equity, the International Equity and the International Equity Index
Funds are maintained in U.S. dollars on the following basis:
(I) market value of investment securities, assets and liabilities at
the current rate of exchange; and
(II) purchases and sales of investment securities, income and expenses
at the relevant rates of exchange prevailing on the respective
dates of such transactions.
The Emerging Markets Equity, the International Equity and the International
Equity Index Funds do not isolate that portion of gains and losses on
investments in equity securities that is due to changes in the foreign
exchange rates from that which is due to changes in market prices of equity
securities.
The Emerging Markets Equity, the International Equity and the International
Equity Index Funds report certain foreign currency related transactions as
components of realized and unrealized gains and losses for financial
reporting purposes, whereas such components are treated as ordinary income
for Federal income tax purposes.
OTHER -- Expenses that are directly related to a specific Fund are charged
to that Fund. Class specific expenses are borne by that class. Other
operating expenses of the Trust are pro-rated to the Funds on the basis of
relative net assets. Fund expenses are pro-rated to the respective classes
on the basis of relative net assets.
Distributions from net investment income of each of the Money Market Funds
and the Investment Grade Bond, the Investment Grade Tax-Exempt Bond, the
Short-Term U.S. Treasury Securities, the Short-Term Bond, the Florida
Tax-Exempt Bond, the Georgia Tax-Exempt Bond, the Tennessee Tax-Exempt
Bond, the U.S. Government Securities and the Limited-Term Federal Mortgage
Securities Funds are declared each business day and paid to shareholders on
133
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
a monthly basis. Distributions from net investment income are declared and
paid each calendar quarter by the Capital Growth, the Value Income Stock,
the Sunbelt Equity, the Mid-Cap Equity, the Small Cap Equity and the
Balanced Funds. Distributions from net investment income are declared and
paid annually by the Emerging Markets Equity, the International Equity and
the International Equity Index Funds. Any net realized capital gains on
sales of securities are distributed to shareholders at least annually.
RECLASSIFICATION OF COMPONENTS OF NET ASSETS -- The timing and
characterization of certain income and capital gains distributions are
determined annually in accordance with federal tax regulations which may
differ from generally accepted accounting principles. As a result, net
investment income (loss) and net realized gain (loss) on investment
transactions for a reporting period may differ significantly from
distributions during such period. These book/tax differences may be
temporary or permanent in nature. To the extent these differences are
permanent, they are charged or credited to paid-in-capital or accumulated
net realized gain, as appropriate, in the period that the differences
arise. Accordingly, the following permanent differences, primarily
attributable to a net operating loss in the Sunbelt Equity Fund and the
classification of short-term capital gains and ordinary income for tax
purposes related to the other funds, have been reclassified to/from the
following accounts:
UNDISTRIBUTED
ACCUMULATED NET INVESTMENT
PAID-IN-CAPITAL REALIZED GAIN INCOME
(000) (000) (000)
--------------- ------------- --------------
Mid-Cap Equity Fund $-- $(207) $ 207
International Equity
Index Fund -- (204) 204
International Equity
Fund -- 83 (83)
Sunbelt Equity Fund (2,967) -- 2,967
Short-Term Bond Fund -- (54) 54
These reclassifications have no effect on net assets or net asset values
per share.
USE OF ESTIMATES -- The preparation of the financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that effect the reported
amount of assets and liabilities, disclosure of contingent assets and
liabilities at the date of the financial statements, and reported amounts
of revenues and expenses during the reporting period. Actual amounts could
differ from these estimates.
3. Organization Costs and Transactions with Affiliates:
The Trust incurred organization costs of approximately $808,836 including
approximately $395,594 relating to state registration fees. These costs have
been deferred in the accounts of the Funds and are being amortized on a straight
line basis over a period of sixty months commencing with operations with the
exception of state registration fees, which are being amortized over a period of
twelve months. The costs include legal fees of approximately $60,383 for
organizational work performed by a law firm of which two officers of the Trust
are partners. On March 18, 1992, the Trust sold initial shares of beneficial
interest to SEI Fund Resources (the "Administrator"). In the event any of the
initial shares of the Trust are redeemed by any holder thereof during the period
that the Trust is amortizing its organizational costs, the redemption proceeds
payable to the holder thereof will be reduced by the unamortized organizational
costs in the same ratio as the number of initial shares being redeemed bears to
the number of initial shares outstanding at the time of redemption.
Certain officers of the Trust are also officers of the Administrator and/or SEI
Investments Distribution Co. (the "Distributor"). Such officers are paid no fees
by the Trust for serving as officers of the Trust.
134
<PAGE>
================================================================================
4. Administration, Transfer Agency Servicing and Distribution Agreements:
The Trust and the Administrator are parties to an Administration Agreement dated
May 29, 1995, under which the Administrator provides administrative services for
an annual fee (expressed as a percentage of the combined average daily net
assets of the Trust and STI Classic Variable Annuity Trust) of: .10% up to $1
billion, .07% on the next $4 billion, .05% on the next $3 billion, .045% on the
next $2 billion and .04% for over $10 billion.
The Trust and Federated Services Company are parties to a Transfer Agency
servicing agreement dated May 14, 1994 under which Federated Services Company
provides transfer agency services to the Trust.
The Trust and the Distributor are parties to a Distribution Agreement dated May
29, 1995 regarding the Flex Shares and a Distribution Agreement dated November
21, 1995 with respect to the Trust and Investor shares. The Distributor will
receive no fees for its distribution services under this agreement for the Trust
Shares of any Fund. With respect to the Investor Shares and Flex Shares, the
Distributor receives amounts, pursuant to a Distribution Plan and (in the case
of Flex Shares) a Distribution and Service Plan, as outlined in the table in
footnote 5 under the column titled "Distribution Fee".
5. Investment Advisory and Custodian Agreements:
The Trust and STI Capital Management, N.A., ("STI Capital Management, N.A."),
Trusco Capital Management ("Trusco"), the SunTrust Bank, Atlanta and SunTrust
Bank, Chattanooga have entered into advisory agreements dated May 29, 1992, June
15, 1993, December 20, 1993 and December 20, 1993 respectively.
Under terms of the respective agreements, the Funds are charged the following
annual fees based upon average daily net assets:
MAXIMUM
FLEX
SHARE
MAXIMUM DISTRI-
MAXIMUM TRUST INVESTOR INVESTOR BUTION FLEX
ANNUAL SHARE SHARE SHARE AND SHARE
ADVISORY MAXIMUM DISTRI- MAXIMUM SERVICE MAXIMUM
FEE EXPENSE BUTION FEE EXPENSE FEE EXPENSE
-------- ------- ---------- ------- -------- -------
TRUSCO:
International
Equity Index
Fund* ....... .90% 1.05% .38% 1.45% 1.00% 2.10%
Sunbelt Equity
Fund ........ 1.15% 1.15% .43% 1.60% 1.00% 2.20%
Short-Term Bond
Fund ........ .65% .65% .23% .85% 1.00% 1.20%
Short-Term U.S.
Treasury
Securities
Fund ........ .65% .65% .18% .80% 1.00% 1.05%
U.S. Government
Securities
Fund ........ .74% .75% .38% 1.15% 1.00% 1.66%
Prime Quality
Money Market
Fund ........ .65% .58% .20% .75% -- --
U.S. Government
Securities
Money Market
Fund ........ .65% .61% .17% .75% -- --
Tax-Exempt
Money Market
Fund ........ .55% .60% .15% .72% -- --
135
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
MAXIMUM
FLEX
SHARE
MAXIMUM DISTRI-
MAXIMUM TRUST INVESTOR INVESTOR BUTION FLEX
ANNUAL SHARE SHARE SHARE AND SHARE
ADVISORY MAXIMUM DISTRI- MAXIMUM SERVICE MAXIMUM
FEE EXPENSE BUTION FEE EXPENSE FEE EXPENSE
-------- ------- ---------- ------- -------- -------
STI CAPITAL MANAGEMENT, N.A.:
Value Income
Stock Fund .. .80% .95% .33% 1.30% 1.00% 2.00%
Mid-Cap Equity
Fund ........ 1.15% 1.15% .43% 1.60% 1.00% 2.20%
Capital Growth
Fund ........ 1.15% 1.15% .68% 1.80% 1.00% 2.27%
Balanced Fund .95% .95% .28% 1.25% 1.00% 2.01%
Small Cap
Equity Fund . 1.15% 1.20% -- -- -- --
Investment
Grade
Tax-Exempt
Bond Fund ... .74% .75% .43% 1.15% 1.00% 1.63%
Florida
Tax-Exempt
Bond Fund ... .65% .65% .18% .85% 1.00% 1.35%
Investment
Grade Bond
Fund ........ .74% .75% .43% 1.15% 1.00% 1.64%
Limited-Term
Federal Mortgage
Securities
Fund ........ .65% .65% .23% .90% 1.00% 1.25%
International
Equity Fund . 1.25% 1.46% .33% 1.81% 1.00% 2.51%
Emerging Markets
Equity Fund . 1.30% 1.55% -- -- -- --
SUNTRUST BANK, ATLANTA:
Georgia
Tax-Exempt
Bond Fund ... .65% .65% .18% .85% 1.00% 1.35%
SUNTRUST BANK, CHATTANOOGA:
Tennessee
Tax-Exempt
Bond Fund ... .65% .65% .18% .85% 1.00% 1.35%
- -----------------
*Trusco and SunBank serve as joint advisors to the International Equity Index
Fund.
The Investment Advisors, the Administrator and the Distributor have voluntarily
agreed to waive all or a portion of their fees (and to reimburse Funds'
expenses) in order to limit operating expenses to an amount as outlined in the
table above. Fee waivers and expense reimbursements are voluntary and may be
terminated at any time.
SunTrust Bank, Atlanta, formerly Trust Company Bank, acts as custodian for all
the Funds except the Emerging Markets Equity, the International Equity and the
International Equity Index Funds who utilize the Bank of New York as custodian.
Fees of the Custodians are paid on the basis of the net assets of the Funds. The
Custodians play no role in determining the investment policies of the Trust or
which securities are to be purchased or sold in the Funds.
6. Investment Transactions:
The cost of purchases and the proceeds from sales of securities, excluding
short-term investments and U.S. Government Securities, for the period ended May
31, 1997, were as follows:
PURCHASES SALES
(000) (000)
----------- ---------
Value Income Stock Fund ....................... $1,510,065 $1,479,214
Mid-Cap Equity Fund ........................... 418,847 401,422
Small Cap Equity Fund ......................... 138,246 20,448
Capital Growth Fund ........................... 1,613,504 1,785,362
Balanced Fund ................................. 162,679 134,261
Emerging Markets Equity Fund .................. 39,912 6,023
International Equity Index Fund ............... 1,316 43,227
International Equity Fund ..................... 683,881 480,728
Sunbelt Equity Fund ........................... 297,705 337,710
Investment Grade Tax-Exempt Bond Fund ......... 737,733 729,258
Florida Tax-Exempt Bond Fund .................. 69,939 56,743
Tennessee Tax-Exempt Bond Fund ................ 858 814
Georgia Tax-Exempt Bond Fund .................. 18,954 5,152
Investment Grade Bond Fund .................... 833,857 550,764
Short-Term Bond Fund .......................... 57,688 42,957
Short-Term U.S. Treasury Securities Fund ...... -- --
Limited-Term Federal Mortgage Securities Fund . -- --
U.S. Government Securities Fund ............... -- --
The cost of purchases and proceeds from sales of U.S. Government Securities
were:
PURCHASES SALES
(000) (000)
----------- ---------
Value Income Stock Fund ............... $ -- $ --
Mid-Cap Equity Fund ................... -- --
Small Cap Equity Fund ................. -- --
Capital Growth Fund ................... -- --
Balanced Fund ......................... 79,476 93,071
Emerging Markets Equity Fund .......... -- --
International Equity Index Fund ....... -- --
International Equity Fund ............. -- --
Sunbelt Equity Fund ................... -- --
Investment Grade Tax-Exempt Bond Fund . -- --
Florida Tax-Exempt Bond Fund .......... -- --
Tennessee Tax-Exempt Bond Fund ........ -- --
Georgia Tax-Exempt Bond Fund .......... -- --
136
<PAGE>
===============================================================================
PURCHASES SALES
(000) (000)
----------- ---------
Investment Grade Bond Fund ................. $1,016,624 $1,283,246
Short-Term Bond Fund ....................... 49,756 70,593
Short-Term U.S. Treasury Securities Fund ... 32,074 21,455
Limited-Term Federal Mortgage
Securities Fund ......................... 187,177 136,508
U.S. Government Securities Fund ............ 12,660 4,083
At May 31, 1997, the total cost of securities and the net realized gains or
losses on securities sold for Federal income tax purposes were not materially
different from amounts reported for financial reporting purposes. The aggregate
gross unrealized appreciation and depreciation for securities held by the Funds
at May 31, 1997, were as follows:
VALUE INCOME MID-CAP SMALL CAP CAPITAL
STOCK EQUITY EQUITY GROWTH
FUND FUND FUND FUND
(000) (000) (000) (000)
------------ ------ --------- -------
Aggregate gross unrealized
appreciation ......... $181,099 $36,213 $8,808 $201,727
Aggregate gross unrealized
depreciation ......... (26,682) (10,378) (1,164) (20,916)
-------- ------- ------ -------
Net unrealized appreciation $154,417 $25,835 $7,644 $180,811
======== ======= ====== =======
EMERGING INTERNATIONAL INTERNATIONAL SUNBELT
BALANCED MARKETS EQUITY EQUITY EQUITY
FUND EQUITY FUND INDEX FUND FUND FUND
(000) (000) (000) (000) (000)
-------- ----------- ------------- ------------- -------
Aggregate gross
unrealized
appreciation .. $13,349 $3,401 $12,670 $69,379 $94,010
Aggregate gross
unrealized
depreciation .. (1,442) (1,293) (4,169) (4,549) (12,447)
------- ------ ------- ------- -------
Net unrealized
appreciation .. $11,907 $2,108 $ 8,501 $64,830 $81,563
======= ====== ======= ======= =======
INVESTMENT
GRADE
TAX-EXEMPT FLORIDA TENNESSEE
BOND TAX-EXEMPT TAX-EXEMPT
FUND BOND FUND BOND FUND
(000) (000) (000)
----------- ---------- -----------
Aggregate gross unrealized appreciation $1,557 $843 $132
Aggregate gross unrealized depreciation (84) (43) (12)
------ ---- ----
Net unrealized appreciation .......... $1,473 $800 $120
====== ==== ====
INVESTMENT
GEORGIA GRADE SHORT-
TAX-EXEMPT BOND TERM BOND
FUND FUND FUND
(000) (000) (000)
---------- --------- ----------
Aggregate gross unrealized appreciation $425 $3,182 $ 172
Aggregate gross unrealized depreciation (123) (2,877) (473)
---- ------ -----
Net unrealized appreciation/(depreciation) $302 $ 305 $(301)
==== ====== =====
SHORT- LIMITED-
TERM TERM
U.S. FEDERAL U.S.
TREASURY MORTGAGE GOVERNMENT
SECURITIES SECURITIES SECURITIES
FUND FUND FUND
(000) (000) (000)
---------- ---------- ----------
Aggregate gross unrealized appreciation $ 23 $ 268 $ 85
Aggregate gross unrealized depreciation (53) (413) (299)
---- ----- -----
Net unrealized appreciation/(depreciation) $(30) $(145) $(214)
==== ===== =====
Subsequent to October 31, 1996, the Funds recognized net capital losses for tax
purposes that have been deferred to 1997 and can be used to offset future
capital gains at May 31, 1997. The Funds also had capital loss carryforwards at
May 31, 1997 as follows:
CAPITAL LOSS POST
CARRYOVER EXPIRES EXPIRES EXPIRES EXPIRES 10/31
5/31/97 2002 2003 2004 2005 DEFERRAL
FUND (000) (000) (000) (000) (000) (000)
------------ ------- ------- ------- ------- --------
Florida Tax-Exempt
Bond Fund $ 127 $-- $ -- $-- $ 127 $ 83
Tennessee Tax Exempt
Bond Fund 12 -- -- -- 12 --
Investment Grade
Bond Fund 10,613 -- 6,388 -- 4,225 --
Short-Term Bond Fund 137 -- -- -- 137 120
Short-Term U.S. Treasury
Securities Fund 232 -- 203 29 -- 26
Limited-Term Federal
Mortgage Securities Fund -- -- -- -- -- 28
U.S. Government Securities
Fund 31 -- -- -- 31 20
Prime Quality Money
Market Fund 379 3 173 -- 203 --
U.S. Government Securities
Money Market Fund 62 -- 11 -- 51 --
Tax-Exempt Money
Market Fund 4 -- -- 4 -- --
For tax purposes, the losses in the Funds can be carried forward for a maximum
of eight years to offset any net realized capital gains.
137
<PAGE>
NOTES TO FINANCIAL STATEMENTS (concluded)
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
7. Concentration of Credit Risk:
The Prime Quality Money Market Fund invests primarily in high quality money
market instruments rated in the highest short-term rating category by Standard &
Poor's Ratings Group ("S&P") or Moody's Investors Services, Inc. ("Moody's") or,
if not rated, are determined by the Advisor to be of comparable quality. The
U.S. Government Securities Money Market Fund invests exclusively in U.S.
Treasury obligations, U.S. Government subsidiary corporation securities which
are backed by the full faith and credit of the U.S. Government and repurchase
agreements with approved dealers collateralized by U.S. Treasury securities and
U.S. Government subsidiary corporation securities. The Tax-Exempt Money Market
Fund invests in high quality, U.S. dollar denominated municipal securities rated
in one of the two highest short-term rating categories or, if not rated, are
determined by the Advisor to be of comparable quality. The Investment Grade Bond
Fund, the Short-Term Bond Fund and the Balanced Fund invest primarily in
investment grade obligations rated at least BBB or better by S&P or Baa or
better by Moody's or, if not rated, are determined by the Advisor to be of
comparable quality. The Investment Grade Tax-Exempt Fund invests primarily in
investment grade municipal securities. Municipal securities must be rated BBB or
better by S&P or Baa or better by Moody's in the case of bonds; SP-1, SP-2 or
MIG-1, MIG-2 in the case of notes; A-1, A-2 or P-1, P-2 in the case of
commercial paper; and VMIG-1, VMIG-2 in the case of variable rate demand
obligations. The Short-Term U.S. Treasury Securities Fund invests exclusively in
obligations issued by the U.S. Treasury with a maximum remaining maturity of 3
years or less. The Florida Tax-Exempt Bond Fund, the Georgia Tax-Exempt Bond
Fund, and the Tennessee Tax-Exempt Bond Fund invest primarily in municipal bonds
concentrated in each of their respective states. Municipal securities must be
rated BBB or better by S&P or Baa or better by Moody's in the case of bonds;
A-1, A-2 or P-1, P-2 in the case of tax-exempt commercial paper; and VMIG-1,
VMIG-2 in the case of variable rate demand obligations. The U.S. Government
Securities Fund invests primarily in obligations issued or guaranteed by the
U.S. Government or its agencies or instrumentalities, including mortgage backed
securities. The Limited-Term Federal Mortgage Securities Fund invests in
mortgage related securities issued or guaranteed by U.S. Government agencies. Up
to 35% of the U.S. Government Securities Fund and the Limited-Term Federal
Mortgage Securities Fund may be invested in corporate, or government bonds that
carry a rating of BBB or better by S&P or Baa or better by Moody's. The ability
of the issuers of the securities held by the Funds to meet their obligations may
be affected by economic developments in a specific industry, state or region, or
by changing business conditions.
8. Consent of Sole Shareholder:
On December 30, 1996, the sole shareholder of the Emerging Markets Equity Fund
and Small Cap Equity Fund (the "Funds") approved the following: SEI Fund
Resources as administrator of the Funds, STI Capital Management, N.A. as
investment advisor to the assets of the Funds, SEI Investments Distribution Co.
as distributor of the shares of the Funds, the Distribution and Service Plan for
Flex Shares, the Distribution Plan for Investor Shares, and Arthur Andersen LLP
as independent public accountants of the Funds.
138
<PAGE>
NOTICE TO SHAREHOLDERS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997 UNAUDITED
For shareholders that do not have a May 31, 1997 tax year end, this notice is
for informational purposes only. For shareholders with a May 31, 1997 tax year
end, please consult your tax advisor as to the pertinence of this notice. For
the fiscal year ended May 31, 1997, each portfolio is designating the following
items with regard to distributions paid during the year:
<TABLE>
<CAPTION>
(A)* (B)* (C)
LONG TERM ORDINARY
CAPITAL GAINS INCOME TOTAL
DISTRIBUTIONS DISTRIBUTIONS DISTRIBUTIONS
FUND (TAX BASIS) (TAX BASIS) (TAX BASIS)
- -------- ------------- ------------- -------------
<S> <C> <C> <C>
Value Income Stock 31.66% 68.34% 100%
Mid-Cap Equity 53.39% 46.61% 100%
Small Cap Equity 0% 100% 100%
Capital Growth 36.04% 63.96% 100%
Balanced 28.88% 71.12% 100%
Emerging Markets Equity 0% 0% 0%
International Equity Index 68.28% 31.72% 100%
International Equity 0% 100% 100%
Sunbelt Equity 78.18% 21.82% 100%
Investment Grade Tax-Exempt Bond .90% 99.10% 100%
Florida Tax-Exempt Bond 2.50% 97.50% 100%
Tennessee Tax-Exempt Bond 0% 100% 100%
Georgia Tax-Exempt Bond 6.68% 93.32% 100%
Investment Grade Bond 0% 100% 100%
Short-Term Bond 0% 100% 100%
Short-Term U.S. Treasury Securities 0% 100% 100%
Limited-Term Federal Mortgage Securities 1.81% 98.19% 100%
U.S. Government Securities 0% 100% 100%
Prime Quality Money Market 0% 100% 100%
U.S. Government Securities Money Market 0% 100% 100%
Tax-Exempt Money Market 0% 100% 100%
(D)** (E)***
QUALIFYING TAX-EXEMPT
FUND DIVIDENDS(1) INTEREST
- -------- ------------ ----------
<S> <C> <C>
Value Income Stock 24.34% 0%
Mid-Cap Equity 17.39% 0%
Small Cap Equity 100% 0%
Capital Growth 9.03% 0%
Balanced 8.08% 0%
Emerging Markets Equity 0% 0%
International Equity Index 0% 0%
International Equity 0% 0%
Sunbelt Equity 0% 0%
Investment Grade Tax-Exempt Bond 0% 65.39%
Florida Tax-Exempt Bond 0% 94.61%
Tennessee Tax-Exempt Bond 0% 92.09%
Georgia Tax-Exempt Bond 0% 93.94%
Investment Grade Bond 0% 0%
Short-Term Bond 0% 0%
Short-Term U.S. Treasury Securities 0% 0%
Limited-Term Federal Mortgage Securities 0% 0%
U.S. Government Securities 0% 0%
Prime Quality Money Market 0% 0%
U.S. Government Securities Money Market 0% 0%
Tax-Exempt Money Market 0% 99.44%
<FN>
- ------------------
(1) Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction.
* Items (A) and (B) are based on a percentage of each fund's total
distributions.
** Item (D) is based on the net income of the fund.
*** Item (E) is based on the ordinary income distributions of the fund.
</FN>
</TABLE>
139
<PAGE>
NOTICE TO SHAREHOLDERS
===============================================================================
STI CLASSIC FUNDS MAY 31, 1997
FOR TAXPAYERS FILING ON A CALENDAR YEAR BASIS, THIS NOTICE IS
FOR INFORMATIONAL PURPOSES ONLY.
The STI Classic International Equity Index Fund and STI Classic International
Equity Fund have made an election under section 853 of the Internal Revenue Code
(the "Code") to provide a foreign tax deduction or credit to their shareholders
for the fiscal year ended May 31, 1997. The information provided below is
pertinent to taxpayers who meet the following two criteria:
1) file a U.S. Federal Income Tax Return and
2) held shares of the Fund on the dividend record date of December 30,
1996 and satisfy the applicable requirements of the Code.
The amount per share of income from, and foreign taxes paid to, each country is
listed in the following schedule:
<TABLE>
<CAPTION>
STI CLASSIC INTERNATIONAL EQUITY INDEX FUND
TRUST SHARES INVESTOR SHARES FLEX SHARES
GROSS FOREIGN GROSS FOREIGN GROSS FOREIGN
COUNTRY DIVIDEND TAXES PAID DIVIDEND TAXES PAID DIVIDEND TAXES PAID
- ------ -------- ---------- -------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Australia 0.0018 0.0003 0.0012 0.0003 0.0004 0.0003
Austria 0.0059 0.0004 0.0037 0.0004 0.0005 0.0004
Belgium 0.0054 0.0015 0.0039 0.0015 0.0016 0.0015
Denmark 0.0014 0.0004 0.0010 0.0004 0.0004 0.0004
Finland 0.0014 0.0004 0.0010 0.0004 0.0004 0.0004
France 0.0216 0.0076 0.0162 0.0076 0.0080 0.0076
Germany 0.0197 0.0028 0.0131 0.0028 0.0033 0.0028
Hong Kong 0.0018 0.0000 0.0011 0.0000 0.0001 0.0000
Italy 0.0113 0.0028 0.0080 0.0028 0.0030 0.0028
Japan 0.0186 0.0053 0.0134 0.0053 0.0057 0.0053
Netherlands 0.0068 0.0019 0.0049 0.0019 0.0020 0.0019
Norway 0.0016 0.0005 0.0012 0.0005 0.0005 0.0005
Spain 0.0113 0.0031 0.0081 0.0031 0.0033 0.0031
Sweden 0.0028 0.0008 0.0020 0.0008 0.0009 0.0008
Switzerland 0.0027 0.0004 0.0018 0.0004 0.0005 0.0004
United Kingdom 0.0290 0.0082 0.0209 0.0082 0.0088 0.0082
United States 0.0017 0.0000 0.0010 0.0000 0.0000 0.0000
------ ------ ------ ------ ------ ------
0.1448 0.0364 0.1025 0.0364 0.0394 0.0364
</TABLE>
Please consult your tax advisor for proper treatment of this information.
140
<PAGE>
================================================================================
UNAUDITED
FOR TAXPAYERS FILING ON A CALENDAR YEAR BASIS, THIS NOTICE IS FOR
INFORMATIONAL PURPOSES ONLY.
The amount per share of income from and foreign taxes paid to each country is
listed in the following schedule:
STI CLASSIC INTERNATIONAL EQUITY FUND
TRUST SHARES
GROSS FOREIGN
COUNTRY DIVIDEND TAXES PAID
------ -------- ----------
Argentina 0.0003 0.0000
Australia 0.0012 0.0002
Brazil 0.0001 0.0000
Canada 0.0016 0.0008
Chile 0.0001 0.0001
Denmark 0.0002 0.0001
Finland 0.0027 0.0014
France 0.0026 0.0017
Germany 0.0016 0.0008
Hong Kong 0.0016 0.0000
Indonesia 0.0005 0.0003
Italy 0.0021 0.0012
Japan 0.0022 0.0011
Mexico 0.0004 0.0000
Netherlands 0.0059 0.0031
New Zealand 0.0005 0.0003
Panama 0.0003 0.0000
Peru 0.0004 0.0000
Singapore 0.0011 0.0007
South Africa 0.0003 0.0000
Spain 0.0017 0.0009
Sweden 0.0040 0.0021
Switzerland 0.0015 0.0007
United Kingdom 0.0037 0.0018
United States 0.0030 0.0000
------ ------
0.0396 0.0173
Please consult your tax advisor for proper treatment of this information.
141
<PAGE>
NOTES
<PAGE>
NOTES
<PAGE>
NOTES
<PAGE>
INVESTMENT ADVISORS
STI Capital Management, N.A.
Trusco Capital Management, Inc.
SunTrust Bank, Chattanooga, N.A.
SunTrust Bank, Atlanta
STI Classic Funds are not deposits, are not insured or guaranteed by the FDIC or
any other government agency, and are not endorsed by and do not constitute
obligations of SunTrust Banks, Inc. or any other of its affiliates. Investment
in the Funds involves risk, including the possible loss of principal. There is
no guarantee that any STI Classic Fund will achieve its investment objective.
The STI Classic Funds are advised by affiliates of SunTrust Banks, Inc.
DISTRIBUTOR
SEI Investments Distribution Co.
This information must be preceded or accompanied by
a current prospectus for each Fund described.
<PAGE>
ANNUAL
................................................................................
FINANCIAL REPORT
................................................................................
STI CLASSIC FUNDS
................................................................................
A Family of Mutual Funds
................................................................................
CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND
CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND
May 31, 1997
[Logo Omitted]
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and Board of Trustees of
STI Classic Funds:
We have audited the accompanying statements of net assets of the Classic
Institutional Cash Management Money Market Fund and the statements of assets and
liabilities, including the schedule of investments, of the Classic Institutional
U.S. Treasury Securities Money Market Fund of STI Classic Funds (the "Trust") as
of May 31, 1997, and the related statements of operations, changes in net
assets, and financial highlights for the periods presented. These financial
statements and financial highlights are the responsibility of the Trust's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of May
31, 1997, by correspondence with the custodian and the application of
alternative auditing procedures with respect to unsettled securities
transactions. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Classic Institutional Cash Management Money Market Fund and Classic
Institutional U.S. Treasury Securities Money Market Fund of STI Classic Funds as
of May 31, 1997, the results of their operations, changes in their net assets,
and financial highlights for the periods presented, in conformity with generally
accepted accounting principles.
ARTHUR ANDERSEN LLP
Philadelphia, PA
July 11, 1997
1
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND
- --------------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------------
COMMERCIAL PAPER (70.0%)
A1 Credit
5.640%, 06/02/97 $13,000 $12,998
American Express
5.500%, 08/28/97 500 493
Banc One Funding
5.620%, 07/21/97 4,000 3,969
5.680%, 08/14/97 3,811 3,767
Bank of America Toronto, Yankee
5.730%, 07/31/97 5,500 5,500
Bank of Montreal
5.520%, 07/01/97 10,000 9,954
Bank of New York
5.500%, 06/02/97 3,350 3,350
Bankers Trust
5.500%, 11/17/97 200 195
BAT Capital
5.530%, 06/24/97 10,000 9,965
Bell Atlantic Network Funding
5.600%, 06/12/97 1,000 998
Campbell Soup
5.550%, 07/07/97 2,550 2,536
Cargill Global Funding
5.550%, 06/16/97 5,000 4,988
5.820%, 11/25/97 500 486
Caterpillar Financial Services
5.600%, 09/11/97 4,915 4,837
Dean Witter Discover
5.640%, 08/01/97 6,000 5,943
Dominion Semiconductor
5.650%, 06/03/97 5,000 4,998
5.570%, 06/11/97 5,000 4,992
Dresser Industries
5.550%, 06/30/97 10,000 9,955
Ford Motor Credit
5.520%, 06/24/97 835 832
5.600%, 06/27/97 1,000 996
5.640%, 07/21/97 5,000 4,961
Gannett
5.520%, 06/17/97 4,775 4,763
General Electric Capital
5.400%, 06/02/97 500 500
5.700%, 06/30/97 1,000 995
5.630%, 09/25/97 1,000 982
Golden Peanut
5.400%, 07/15/97 250 248
GTE Funding
5.510%, 06/05/97 3,500 3,498
5.510%, 06/06/97 5,350 5,346
5.530%, 06/17/97 3,000 2,993
Hertz
5.620%, 07/25/97 8,500 8,428
IBM Credit
5.550%, 06/09/97 7,717 7,708
5.550%, 06/19/97 5,000 4,987
John Hancock Capital
5.600%, 06/26/97 9,375 9,339
Marsh & Mclennan
5.700%, 09/05/97 2,393 2,357
- --------------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------------
Metlife Funding
5.530%, 07/11/97 $ 2,203 $ 2,189
Monongahela Power
5.700%, 06/02/97 6,320 6,319
National Australia Funding
5.550%, 06/02/97 12,000 11,998
5.430%, 08/13/97 250 247
National City Credit
5.650%, 07/28/97 2,000 1,982
5.665%, 08/21/97 5,000 4,936
New England Power
5.550%, 06/04/97 2,300 2,299
5.520%, 06/06/97 5,550 5,546
5.540%, 06/12/97 2,123 2,119
Pactel Capital Resources
5.510%, 06/23/97 7,000 6,976
Philip Morris
5.700%, 06/02/97 8,000 7,999
5.550%, 06/06/97 1,505 1,504
5.550%, 06/09/97 1,275 1,273
5.550%, 06/18/97 1,240 1,237
Potomac Electric Power
5.600%, 06/06/97 9,360 9,353
Progress Capital
5.520%, 06/09/97 8,798 8,787
5.550%, 06/20/97 1,271 1,267
Royal Bank Canada
5.580%, 07/15/97 3,010 2,989
RTZ America
5.370%, 06/16/97 250 249
5.550%, 06/25/97 250 249
5.570%, 07/08/97 800 795
Sherwin Williams
5.550%, 06/18/97 5,000 4,987
Societe Generale North America
5.500%, 09/10/97 200 197
Sony Capital
5.650%, 06/02/97 4,400 4,399
South Carolina Fuel
5.510%, 06/20/97 4,435 4,422
Southern New England
Telcommunications
5.580%, 06/11/97 1,157 1,155
Transamerica Finance
5.650%, 06/02/97 7,500 7,499
5.520%, 06/12/97 5,000 4,992
5.530%, 06/13/97 700 699
U.S. Borax
5.370%, 06/16/97 250 249
5.600%, 07/01/97 2,000 1,991
5.650%, 07/16/97 1,600 1,589
Union Bank Of Switzerland Finance
5.750%, 06/02/97 1,000 1,000
Virgina Electric & Power
5.650%, 07/16/97 2,000 1,986
Waste Management Technologies
5.580%, 06/24/97 3,000 2,989
5.650%, 06/27/97 2,770 2,759
2
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND--CONCLUDED
- --------------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------------
Xerox Credit
5.520%, 06/12/97 $1,985 $ 1,982
5.510%, 06/24/97 5,100 5,082
--------
Total Commercial Paper
(Cost $277,147) 277,147
--------
MUNICIPAL BONDS (0.3%)
Compton Community,
Redevelopment Agency,
Series 1995B, RB (FSA)
6.150%, 08/01/97 1,000 1,000
--------
Total Municipal Bonds
(Cost $1,000) 1,000
--------
CORPORATE OBLIGATIONS (5.2%)
Associates Corporation of
North America
6.750%, 06/13/97 3,000 3,001
8.625%, 06/15/97 500 500
Beneficial MTN
6.850%, 11/19/97 1,500 1,506
6.860%, 11/19/97 2,200 2,209
BP America
8.875%, 12/01/97 200 203
Dow Capital
5.750%, 09/15/97 500 500
FCC National Bank (A)
5.640%, 05/08/98 3,000 2,999
Federal National Mortgage
Association MTN
6.520%, 09/08/97 500 501
6.520%, 09/15/97 900 901
First Chicago MTN
11.150%, 10/31/97 1,700 1,735
Household Finance
7.750%, 06/15/97 2,250 2,251
6.250%, 10/15/97 1,000 1,001
Morgan Guaranty Trust
5.950%, 06/06/97 200 200
Teco Energy MTN
9.250%, 06/16/97 3,000 3,004
--------
Total Corporate Obligations
(Cost $20,511) 20,511
--------
CERTIFICATES OF DEPOSIT (4.8%)
Bankers Trust Toronto
5.690%, 08/21/97 4,000 4,000
Societe Generale Yankee
5.690%, 08/22/97 5,000 5,000
Swiss Bank, Yankee
5.530%, 06/30/97 10,000 10,000
--------
Total Certificates Of Deposit
(Cost $19,000) 19,000
--------
- --------------------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------------
ASSET-BACKED SECURITIES (1.0%)
Americredit Auto Receivables
Trust, 1997-B, Cl A
5.790%, 06/12/98 $ 4,000 $ 4,000
--------
Total Asset-Backed Securities
(Cost $4,000) 4,000
--------
REPURCHASE AGREEMENTS (21.3%)
Deutsche Bank
5.56%, dated 05/30/97, matures
06/02/97, repurchase price
$76,220,749 (collateralized by
various FHLMC obligations,
total par value $94,382,160,
0.000%-6.630%, 05/15/08- 09/01/26;
FNMA obligation, par value
$21,264,738, 0.000%, 01/01/26:
total market value $77,708,900) 76,185 76,185
Salomon Brothers
5.56%, dated 05/30/97, matures
06/02/97, repurchase price
$8,072,554 (collateralized by
various FHLMC obligations,
total par value $9,465,582,
6.014%-8.500%, 07/01/02-
11/01/26; various FNMA
obligations, total par
value $20,886,794, 5.500%-9.000%,
04/01/98-05/01/26: total
market value $8,294,005) 8,069 8,069
--------
Total Repurchase Agreements
(Cost $84,254) 84,254
--------
Total Investments (102.6%)
(Cost $405,912) 405,912
--------
OTHER ASSETS AND LIABILITIES, NET (-2.6%) (10,239)
--------
NET ASSETS:
Fund shares of the Institutional Shares
(unlimited authorization -- no par
value) based on 395,673,180
outstanding shares of beneficial
interest
395,673
--------
Total Net Assets (100.0%) $395,673
========
Net Asset Value, Offering and
Redemption Price Per Share --
Institutional Shares $ 1.00
========
Cl Class
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
FSA Security insured by Financial Security Assurance
MTN Medium Term Note
RB Revenue Bond
(A) Variable rate security. The rate reported on the Statement of Net
Assets is the rate in effect on May 31, 1997.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
3
<PAGE>
SCHEDULE OF INVESTMENTS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997
CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND
- -------------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
- -------------------------------------------------------------------
TREASURY NOTE (4.9%)
U.S. Treasury Note
5.750%, 10/31/97 $1,000 $1,000
------
Total Treasury Note
(Cost $1,000) 1,000
------
REPURCHASE AGREEMENTS (71.1%)
Deutsche Bank
5.50%, dated 05/30/97, matures
06/02/97, repurchase price
$1,031,851 (collateralized by
U.S. Treasury Bill, par value
$948,000, 0.000%, 07/31/97; U.S.
Treasury Note, par value
$111,000, 5.125%, 12/31/98:
total maket value $1,052,006) 1,031 1,031
Merrill Lynch
5.50%, dated 05/30/97, matures
06/02/97, repurchase price
$1,000,995 (collateralized by
U.S. Government STRIPS,
total par value $1,995,661, 0.000%,
05/15/02-11/15/14:
total market value $1,021,320) 1,001 1,001
Barclays
5.50%, dated 05/30/97, matures
06/02/97, repurchase price
$4,677,964 (collateralized by
U.S. Treasury Bill, par value
$4,955,000, 0.000%, 02/05/98:
market value $4,770,173) 4,676 4,676
Morgan Stanley
5.50%, dated 05/30/97, matures
06/02/97, repurchase price
$1,000,458 (collateralized
by U.S. Treasury Note, par
value $990,000, 7.25%, 05/15/04:
market value $1,021,442) 1,000 1,000
- -----------------------------------------------------------------
FACE
AMOUNT (000) VALUE (000)
- -----------------------------------------------------------------
Salomon Brothers
5.50%, dated 05/30/97, matures
06/02/97, repurchase price
$1,000,458 (collateralized by
various U.S. Treasury Notes,
total par value $1,005,000,
6.125%-8.875%, 11/15/97-
07/31/00: total market
value $1,022,745) $1,000 $ 1,000
Swiss Bank
5.50%, dated 05/30/97, matures
06/02/97, repurchase price
$4,678,206 (collateralized by
U.S. Treasury Bond, par value
$4,565,000, 7.250%, 08/15/22;
U.S. Treasury Note, par value
$25,000, 5.875%, 06/30/00:
total market value $4,777,310) 4,676 4,676
Union Bank of Switzerland
5.50%, dated 05/30/97, matures
06/02/97, repurchase price
$1,000,458 (collateralized
by U.S. Treasury Note, par value
1,030,000, 5.875%, 11/15/99:
market value $1,021,198) 1,000 1,000
-------
Total Repurchase Agreements
(Cost $14,384) 14,384
-------
Total Investments (76.0% of Net Assets)
(Cost $15,384) $15,384
=======
STRIPS Separately Traded Registered Interest and
Principal Security
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
4
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (000)
================================================================================
STI CLASSIC FUNDS FOR THE PERIOD ENDED MAY 31, 1997
<TABLE>
<CAPTION>
CLASSIC INSTITUTIONAL
U.S. TREASURY
SECURITIES
MONEY MARKET
FUND
----------------
Assets:
<S> <C> <C>
Investments at market value (Cost $15,384) ................................................. $15,384
Receivables for investment securities sold ................................................. 4,951
Other assets ............................................................................... 120
-------
Total Assets ............................................................................... 20,455
-------
Liabilities:
Accrued expenses ........................................................................... 26
Distribution payable ....................................................................... 101
Other liabilities .......................................................................... 90
-------
Total Liabilities 217
-------
Net Assets:
Fund Shares of the Institutional Shares (unlimited authorization -- no par value)
based on 20,238,609 outstanding shares of beneficial interest ............................ 20,239
Accumulated net realized loss on investments ............................................... (1)
-------
Total Net Assets ........................................................................... $20,238
=======
Net Asset Value, Offering Price and Redemption Price Per Share -- Institutional Shares ........ $ 1.00
=======
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
5
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS (000)
===========================================================================================================================
STI CLASSIC FUNDS FOR THE PERIOD ENDED MAY 31, 1997
CLASSIC CLASSIC
INSTITUTIONAL INSTITUTIONAL
CASH MANAGEMENT U.S. TREASURY
MONEY MARKET SECURITIES MONEY
FUND MARKET FUND
-------------- --------------
12/12/96*- 12/12/96*-
05/31/97 05/31/97
---------- --------
Income:
<S> <C> <C>
Interest Income ............................................................ $2,784 $491
Expenses:
Investment Advisory Fees ................................................... 100 18
Investment Advisory Fees Waived ............................................ (100) (18)
Contribution from Advisor .................................................. (131) (20)
Administrator Fees ......................................................... 33 6
Registration Fees .......................................................... 108 3
Transfer Agent Fees ........................................................ 8 8
Printing Fees .............................................................. 3 3
Amortization of Deferred Organizational Costs .............................. 8 8
------ ----
Total Expenses ............................................................. 29 8
------ ----
Net Investment Income ......................................................... 2,755 483
------ ----
Net Realized Loss on Securities Sold .......................................... -- (1)
------ ----
Increase in Net Assets Resulting from Operations .............................. $2,755 $482
====== ====
*Commencement of Operations
Amounts designated as "--" are either $0 or round to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS (000)
===========================================================================================================================
STI CLASSIC FUNDS FOR THE PERIOD ENDED MAY 31, 1997
CLASSIC CLASSIC
INSTITUTIONAL INSTITUTIONAL
CASH MANAGEMENT U.S. TREASURY
MONEY MARKET SECURITIES MONEY
FUND MARKET FUND
-------------- --------------
12/12/96*- 12/12/96*-
05/31/97 05/31/97
---------- --------
Operations:
<S> <C> <C>
Net Investment Income ........................................ $ 2,755 $ 483
Net Realized Loss on Securities Sold ......................... -- (1)
--------- --------
Increase in Net Assets Resulting from Operations ........... 2,755 482
--------- --------
Distributions to Shareholders:
Net Investment Income ...................................... (2,755) (483)
Capital Gains .............................................. -- --
--------- --------
Total Distributions .......................................... (2,755) (483)
--------- --------
Capital Share Transactions (1): ...............................
Proceeds from Shares Issued ................................ 578,520 143,133
Reinvestments of Cash Distributions ........................ -- --
Cost of Shares Redeemed .................................... (182,847) (122,894)
--------- --------
Increase in Net Assets from Share Transactions ............. 395,673 20,239
--------- --------
Total Increase in Net Assets ............................ 395,673 20,238
--------- --------
Net Assets:
Beginning of Period .......................................... -- --
--------- --------
End of Period ................................................ $ 395,673 $ 20,238
========= ========
(1)Shares Issued and Redeemed:
Shares Issued .............................................. 578,520 143,133
Shares Issued in Lieu of Cash Distributions ................ -- --
Shares Redeemed ............................................ (182,847) (122,894)
--------- --------
Net Share Transactions ....................................... 395,673 20,239
========= ========
*Commencement of Operations.
Amounts designated as "--" are either $0 or round to $0.
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
7
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
===========================================================================================================================
STI CLASSIC FUNDS FOR THE PERIOD FROM INCEPTION THROUGH MAY 31, 1997
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
NET REALIZED AND
NET UNREALIZED GAINS
NET ASSET VALUE INVESTMENT OR (LOSSES) DISTRIBUTIONS FROM DISTRIBUTIONS FROM
BEGINNING OF PERIOD INCOME ON INVESTMENTS NET INVESTMENT INCOME REALIZED CAPITAL GAINS
------------------ --------- --------------- -------------------- ----------------------
CLASSIC INSTITUTIONAL CASH MANAGEMENT MONEY MARKET FUND
<S> <C> <C> <C> <C> <C>
Institutional Shares
1997* $ 1.00 $ 0.02 $ -- $(0.02) $ --
CLASSIC INSTITUTIONAL U.S. TREASURY SECURITIES MONEY MARKET FUND
Institutional Shares
1997* $ 1.00 $ 0.02 $ -- $(0.02) $ --
RATIO OF
RATIO OF NET INVESTMENT
RATIO OF EXPENSES TO INCOME TO
NET ASSET NET ASSETS RATIO OF NET INVESTMENT AVERAGE NET ASSETS AVERAGE NET ASSETS
VALUE END TOTAL END OF EXPENSES TO INCOME TO (EXCLUDING WAIVERS (EXCLUDING WAIVERS
OF PERIOD RETURN PERIOD (000) AVERAGE NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS) AND REIMBURSEMENTS)
--------- ------- ------------ ------------------ ------------------ ------------------- -------------------
$ 1.00 2.51% $ 395,673 0.06% 5.49% 0.52% 5.03%
$ 1.00 2.46% $ 20,238 0.09% 5.27% 0.51% 4.85%
</TABLE>
COMMENCED OPERATIONS ON DECEMBEER 12, 1996.
TOTAL RETURN IS FOR THE PERIOD INDICATED.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
8 & 9
<PAGE>
NOTES TO FINANCIAL STATEMENTS
================================================================================
STI CLASSIC FUNDS MAY 31, 1996
1. Organization:
The STI Classic Funds (the "Trust") was organized as a Massachusetts Business
Trust under a Declaration of Trust dated January 15, 1992. The Trust is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company with twenty-three portfolios: the Value Income
Stock Fund, the Mid-Cap Equity Fund, the Small Cap Equity Fund, the Capital
Growth Fund, the Balanced Fund, the Emerging Markets Equity Fund, the
International Equity Index Fund, the International Equity Fund the Sunbelt
Equity Fund, the Investment Grade Tax-Exempt Bond Fund, the Florida Tax-Exempt
Bond Fund, the Tennessee Tax-Exempt Bond Fund, the Georgia Tax-Exempt Bond Fund,
the Investment Grade Bond Fund, the Short-Term Bond Fund, the Short-Term U.S.
Treasury Securities Fund, the Limited-Term Federal Mortgage Securities Fund, and
the U.S. Government Securities Fund, (collectively the "Non-Dollar Funds"), the
Prime Quality Money Market Fund, the U.S. Government Securities Money Market
Fund, the Tax-Exempt Money Market Fund, the Classic Institutional Cash
Management Money Market Fund and the Classic Institutional U.S. Treasury
Securities Money Market Fund, (collectively the "Money Market Funds"). The
assets of each portfolio are segregated, and a shareholder's interest is limited
to the Fund in which shares are held. Each Fund's prospectus provides a
description of the Fund's investment objectives, policies and strategies. The
footnotes herein pertain only to the Classic Institutional Cash Management Money
Market Fund and the Classic Institutional U.S. Treasury Securities Fund
(collectively the "Funds").
2. Significant Accounting Policies:
The following is a summary of significant accounting policies followed by the
Trust:
SECURITY VALUATION -- Investment securities held by the Funds are stated at
amortized cost, which approximates market value.
FEDERAL INCOME TAXES -- It is each Fund's intention to qualify as a
regulated investment company for Federal income tax purposes and distribute
all of its taxable income and net capital gains. Accordingly, no provisions
for Federal income taxes are required.
SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are
accounted for on the date the security is purchased or sold (trade date).
Interest income is recognized on an accrual basis. Costs used in
determining net realized gains and losses on the sales of investment
securities are those of the specific securities sold adjusted for the
accretion and amortization of purchase discounts and premiums during the
respective holding period. Purchase discounts and premiums on securities
held by the Funds are accreted and amortized ratably to maturity and are
included in interest income.
REPURCHASE AGREEMENTS -- Securities pledged as collateral for repurchase
agreements are held by the custodian bank until the respective agreements
mature. Provisions of the repurchase agreements ensure that the market
value of the collateral, including accrued interest thereon, is sufficient
in the event of default of the counterparty. If the counterparty defaults
and the value of the collateral declines or if the counterparty enters into
an insolvency proceeding, realization of the collateral by the Funds may be
delayed or limited.
NET ASSET VALUE PER SHARE -- The net asset value per share of each Fund is
calculated each business day, by dividing the total value of each Fund's
assets, less liabilities, by the number of shares outstanding.
OTHER -- Expenses that are directly related to a specific Fund are charged
to that Fund. Class specific expenses are borne by that class. Other
operating expenses of the Trust are pro-rated to the Funds on the basis of
relative net assets. Fund expenses are pro-rated to the respective classes
on the basis of relative net assets.
Distributions from net investment income of each of the Funds are declared on
each business day and paid to shareholders on a monthly basis. Any net realized
capital gains on sales of securities are distributed to shareholders at least
annually.
3. Organization Costs and Transactions with Affiliates:
The Trust incurred organization costs of approximately $808,836 including
approximately $395,594 relating to state registration fees. These costs have
been deferred in the accounts of the Funds and are being amortized on a straight
line basis over a period of sixty months commencing with operations with the
exception of state registration fees, which are being amortized over a period of
twelve months. The costs include legal fees of approximately $60,383 for
organizational work performed by a law firm of which two officers of the Trust
are partners. On March 18, 1992, the Trust sold initial shares of beneficial
interest to SEI Fund Resources (the "Administrator"). In the event any of the
initial shares of the Trust are redeemed by any holder thereof during the period
that the Trust is amortizing its organizational costs, the redemption proceeds
payable to the holder thereof will be reduced by the unamortized organizational
costs in the same ratio as the number of initial shares being redeemed bears to
the number of initial shares outstanding at the time of redemption.
Certain officers of the Trust are also officers of the Administrator and/or SEI
Investments Distribution Co. (the "Distributor"). Such officers are paid no fees
by the Trust for serving as officers of the Trust.
10
<PAGE>
================================================================================
4. Administration and Transfer Agency Servicing Agreements:
The Trust and the Administrator are parties to an Administration Agreement dated
May 29, 1995, under which the Administrator provides administrative services for
an annual fee (expressed as a percentage of the combined average daily net
assets of the Trust and STI Classic Variable Annuity Trust) of: .10% up to $1
billion, .07% on the next $4 billion, .05% on the next $3 billion, .045% on the
next $2 billion and .04% for over $10 billion.
The Trust and Federated Services Company are parties to a Transfer Agency
servicing agreement dated May 14, 1994 under which Federated Services Company
provides transfer agency services to the Trust.
5. Investment Advisory and Custodian Agreements:
The Trust and STI Capital Management, N.A., ("STI Capital Management, N.A."),
Trusco Capital Management ("Trusco"), the SunTrust Bank, Atlanta and SunTrust
Bank, Chattanooga have entered into advisory agreements dated May 29, 1992, July
15, 1993, December 20, 1993 and December 20, 1993 respectively.
Under terms of the respective agreements, the Funds are charged the following
annual fees based upon average daily net assets:
MAXIMUM INSTITUTIONAL
ANNUAL SHARE
ADVISORY MAXIMUM
FEE EXPENSE
------------ ------------
TRUSCO:
Classic Institutional
Cash Management
Money Market Fund .20% .20%
Classic Institutional
U.S. Treasury
Money Market Fund .20% .20%
The Investment Advisors and the Administrator have voluntarily agreed to waive
all or a portion of their fees (and to reimburse Funds' expenses) in order to
limit operating expenses to an amount as outlined in the table above. Fee
waivers and expense reimbursements are voluntary and may be terminated at any
time.
SunTrust Bank, Atlanta, formerly Trust Company Bank, acts as custodian for the
Funds. Fees of the Custodians are paid on the basis of the net assets of the
Funds. The Custodian plays no role in determining the investment policies of the
Trust or which securities are to be purchased or sold in the Funds.
6. Concentration of Credit Risk:
The Classic Institutional Cash Management Money Market Fund invests in high
quality money market instruments issued by corporations and the U.S. Government
and rated by one or more nationally recognized statistical rating organizations,
or, if not rated determined by the Advisor to be of comparable quality. The
Classic U.S. Treasury Securities Money Market Fund invests in U.S. Treasury
Obligations, which are backed by the full faith and credit of the U.S.
Government and repurchase agreements with approved dealers collateralized by
U.S. Treasury securities.
7. Consents of Sole Shareholder:
On November 20, 1996, the sole shareholder of the Classic Institutional Cash
Management Money Market Fund and Classic Institutional U.S. Treasury Securities
Money Market Fund (the "Funds") approved the following appointments: SEI
Financial Service Company to serve as administrator of the Funds, Trusco Capital
Management to serve as investment advisor to the assets of the Funds, SEI
Investments Distribution Co. to serve as distributor of the shares of the Funds
and Arthur Andersen LLP to serve as independent public accountants of the Funds.
11
<PAGE>
NOTICE TO SHAREHOLDERS
================================================================================
STI CLASSIC FUNDS MAY 31, 1997 UNAUDITED
For shareholders that do not have a May 31, 1997 tax year end, this notice is
for informational purposes only. For shareholders with a May 31, 1997 tax year
end, please consult your tax advisor as to the pertinence of this notice. For
the fiscal year ended May 31, 1997, each portfolio is designating the following
items with regard to distributions paid during the year:
<TABLE>
<CAPTION>
(A)* (B)*
LONG TERM ORDINARY (C)
CAPITAL GAINS INCOME TOTAL (D)** (E)***
DISTRIBUTIONS DISTRIBUTIONS DISTRIBUTIONS QUALIFYING TAX-EXEMPT
FUND (TAX BASIS) (TAX BASIS) (TAX BASIS) DIVIDENDS(1) INTEREST
- ----- -------------- ------------ ---------- ------------ ----------
<S> <C> <C> <C> <C> <C>
Classic Institutional Cash Management Money Market 0% 100% 100% 0% 0%
Classic Institutional U.S. Treasury Securities Money Market 0% 100% 100% 0% 0%
- ------------------------------------
<FN>
(1) Qualifying dividends represent dividends which qualify for the
corporate dividends received deduction.
* Items (A) and (B) are based on a percentage of each fund's total
distributions.
** Item (D) is based on the net income of the fund.
*** Item (E) is based on the ordinary income distributions of the fund.
</FN>
</TABLE>
12
<PAGE>
INVESTMENT ADVISORS
STI Capital Management, N.A.
Trusco Capital Management, Inc.
SunTrust Bank, Chattanooga, N.A.
SunTrust Bank, Atlanta
STI Classic Funds are not deposits, are not
insured or guaranteed by the FDIC or any other
government agency, and are not endorsed by and
do not constitute obligations of SunTrust
Banks, Inc. or any other of its affiliates.
Investment in the Funds involves risk,
including the possible loss of principal. There
is no guarantee that any STI Classic Fund will
achieve its investment objective. The STI
Classic Funds are advised by affiliates of
SunTrust Banks, Inc.
DISTRIBUTOR
SEI Investments Distribution Co.
This information must be preceded or accompanied by
a current prospectus for each Fund described.
