ANNUAL
--------------------------------------------------------------------------------
FINANCIAL REPORT
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STI CLASSIC FIXED INCOME FUNDS
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A FAMILY OF MUTUAL FUNDS
May 31, 2000
[STI Classic Logo Omitted]
<PAGE>
[Blank Page]
<PAGE>
Dear Valued STI Classic Trust Shareholder:
The period corresponding to the STI Classic Funds' fiscal year ending May 31,
2000 is perhaps one of the most unusual in the history of modern financial
markets. The U.S. economy continued on its growth path, extending the longest
period of uninterrupted expansion. In fact, economic growth actually
accelerated, prompting the Federal Reserve (the "Fed") to announce a series of
rate increases. The capital markets responded by rewarding risk in equity
securities and punishing it in fixed income markets. On the equity side,
technology stocks were prominent, as evidenced by the 37.7% rise in the NASDAQ
Composite Index and even greater 59.1% appreciation in the larger stocks of the
NASDAQ 100 Index. Small cap stocks did well, predominantly because of technology
and biotechnology; the S&P 600 Small Cap Index rose 14.2%. Mid-cap stocks did
even better, with the S&P 400 Mid-Cap Index up 21.5%, but again due to
technology. Overall, many stocks did not do well as Fed tightening weighed
heavily on performance. The broader S&P 500 Composite Index was up a more modest
10.5%, while the Dow Jones Industrial Average only achieved a 1.2% positive
return. Within style categories, growth stocks enjoyed a record advantage over
value stocks, a condition which began to reverse only in the last three months
of the STI Classic Funds fiscal year.
On the fixed income side, total returns in bonds were modest, as typified by the
1.9% gain in the Lehman U.S. Government/Corporate Bond Index for longer term
taxable bonds, the 3.5% return in the Merrill Lynch 1-5 Year U.S.
Corporate/Government Index, and very modest returns in short to
intermediate-term municipal bonds. Within the bond arena, investment grade and
high yield bonds were under pressure, while top quality Government bonds
prospered. There was a disconnect between risk/reward as equity investors were
very positive and bond investors were negative.
As the new fiscal year begins for the STI Classic Fund family, we are encouraged
by the broadening out of the equity market. Technology stocks have recently
corrected significantly and small and mid-caps have done better. Importantly,
value oriented stocks outperformed in March/April/May. Tight Fed policy and
rising money market rates due to rapid economic growth are not good for stocks.
Thus, recent signs of slower economic growth are welcome and stocks will do
better once the Fed suspends its tight monetary stance. We also believe the very
wide yield spreads available in non-Government fixed income securities will
prove rewarding over the next 12-24 months. The STI Classic Funds have never
been stronger in terms of product breadth and potential for long-term growth. We
thank all Fund shareholders for their confidence in the STI Classic Family. We
will work hard to deliver competitive results in the months and years ahead.
Sincerely,
/s/ signature omitted
Douglas S. Phillips
President and Chief Investment Officer
Trusco Capital Management, Inc.
<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 for Florida residents and
without undue investment risk. We invest in investment grade municipal bonds
issued by the state of Florida and its municipalities.
In the municipal bond funds 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 to emphasize cheap sectors of the
yield curve. Also, we take advantage of changes in yield spread. 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 credit
and avoid those credits that are deteriorating. The underlying concept to all
these techniques is to enhance total return without adding risk.
The Fund's Trust Shares return from June 1999 to May 2000 was -0.48% versus the
Lehman 10-Year Municipal Bond Index and the Lipper Florida Municipal Debt Funds
Average, which returned -0.18% and -3.22%, respectively, for the same period.
1999 continued to see the municipal yield curve flatten. The one-year AAA rated
municipal bond yield increased 85 basis points for the year, the 5-year AAA
rated municipal bond yield increased 88 basis points, and the 10 year and 20
year AAA rated bonds increased 87 and 92 basis points, respectively.
In the last half of 1999, the municipal market was dominated by concerns over
Y2K. Credit spreads continued to widen with the major credit concerns continuing
to come from the healthcare sector. In addition, the fourth quarter was
dominated by tax swapping, and the high net worth individual investor
reallocating from mutual funds into individual bonds in the intermediate area of
the curve. The reallocation of Property and Casualty companies from tax-exempt
products to corporate and agencies further reduced the institutional demand for
municipals.
On-line commerce exploded in 1999 characterized in municipals by the
aggressiveness of MuniAuction to make competitive and secondary transactions
Internet friendly. A variety of other firms also announced their services and
processes that would make municipal transactions on the web more accessible. The
challenge for 2000 will be providing the municipal market participants with
service and information that is convenient and easy to use.
The first quarter of 2000 was positive for municipals despite negative fund
flows and limited supply. New issue supply was down nearly 40% from the year
before, dramatically affecting activity in the market. As a result, the
secondary market continued to develop into a two-tier market. High quality bonds
remained liquid while lesser quality bonds received weak bids. The lack of
supply was especially burdensome for specialty states like California, Florida,
New York, and Tennessee; where paper is normally richer than the general market.
Because of the continued flattening of the yield curve, bond structure continues
to be an important factor. Twenty-year par bonds trading to a shorter call did
not participate as much in the market rally as compared to a discount or
non-call bond of the same maturity, which saw substantial principal gains.
The portfolio has benefited from our exposure to the 15-20 year area of the
curve where we focused on purchasing deep discounts and noncall bonds.
We continue to emphasize high quality, good structure bonds and will continue to
employ a barbell strategy. Long duration paper will continue to be scarce;
therefore non-call and deep discount bonds will continue to be core holdings.
/s/ signature omitted
Ronald H. Schwartz, CFA, CFP
Senior Vice President
2
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
-0.48% 3.93% 4.57% 4.84% 34.99%
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Florida Lehman 10-Year Lipper Florida
Tax-Exempt Bond Fund, Municipal Municipal
Trust Shares Bond Index Debt Funds Average
Cumulative Returns ($)
1/31/94 $10,000 $10,000 $10,000
5/94 9,786 9,533 9,348
5/95 10,692 10,389 10,201
5/96 11,106 10,880 10,560
5/97 11,908 11,769 11,335
5/98 12,952 12,860 12,358
5/99 13,434 13,455 12,770
5/00 13,370 13,430 12,358
INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
-0.68% 3.73% 4.38% 4.64% 33.47% Without load
-4.38% 2.42% 3.58% 4.01% 28.46% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Florida Lehman 10-Year Lipper Florida
Tax-Exempt Bond Fund, Municipal Municipal
Investor Shares Bond Index Debt Funds Average
Cumulative Returns ($)
1/31/94 $ 9,625 $10,000 $10,000
5/94 9,418 9,533 9,348
5/95 10,270 10,389 10,201
5/96 10,656 10,880 10,560
5/97 11,402 11,769 11,335
5/98 12,376 12,860 12,358
5/99 12,814 13,455 12,770
5/00 12,727 13,430 12,358
FLEX SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years to Date To Date
-1.17% 3.27% 3.91% 21.10% Without load
-3.07% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Florida Lehman 10-Year Lipper Florida
Tax-Exempt Bond Fund, Municipal Municipal
Flex Shares Bond Index Debt Funds Average
Cumulative Returns ($)
6/30/95 $10,000 $10,000 $10,000
5/96 10,424 10,539 10,487
5/97 11,099 11,400 11,257
5/98 11,991 12,456 12,273
5/99 12,367 13,032 12,682
5/00 12,222 13,008 12,273
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 GEORGIA TAX-EXEMPT BOND FUND
--------------------------------------------------------------------------------
The investment objective of 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. Returns for the Fund reflect our conservative strategy that tends to
better protect our participants from undue principal risk when interest rates
rise.
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. We monitor 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 weak during the second half of 1999 as yields for
ten-year municipals rose 50 basis points by year-end. Demand was low as
investors continued to put money into the stock market.
The Federal Reserve, witnessing a continued strong economy and fearful of
inflationary pressures, raised rates three times in the second half of 1999. The
strength in the economy forced the Federal Reserve to raise rates again several
times in early 2000. From May 31, 1999 through May 31, 2000, ten year Treasury
yields rose 80 basis points. In comparison for the same period ten year
municipal yields rose from 4.50% to 5.20%.
The total return for the Fund for the year ended May 31, 2000 was -0.90% (Trust
Shares) versus -0.18% for the Lehman 10-Year Municipal Bond Index. The Lipper
Georgia Municipal Debt Funds Average, by contrast, posted a total one-year
return ended May 31, 2000 of -2.97%.
New issue volume in the Georgia market has been fairly light with the exception
of a $1 billion Atlanta GA Airport issue in early 2000. Recently, greater demand
has reflected renewed investor interest.
/s/ signature omitted
Gay B. Cash
First Vice President
4
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
-0.90% 3.53% 4.25% 3.67% 25.83%
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Georgia Lehman 10-Year Lipper Georgia
Tax-Exempt Bond Fund, Municipal Municipal
Trust Shares Bond Index Debt Funds Average
Cumulative Returns ($)
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 10,495
5/31/97 11,305 11,769 11,300
5/31/98 12,252 12,860 12,359
5/31/99 12,660 13,455 12,759
5/31/00 12,546 13,430 12,380
INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
-1.26% 3.30% 4.10% 3.47% 24.29% Without load
-4.95% 1.99% 3.21% 2.85% 19.63% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Georgia Lehman 10-Year Lipper Georgia
Tax-Exempt Bond Fund, Municipal Municipal
Investor Shares Bond Index Debt Funds Average
Cumulative Returns ($)
1/31/94 $ 9,625 $10,000 $10,000
5/31/94 9,171 9,533 9,338
5/31/95 9,786 10,389 10,124
5/31/96 10,147 10,880 10,495
5/31/97 10,804 11,769 11,300
5/31/98 11,696 12,860 12,359
5/31/99 12,062 13,455 12,759
5/31/00 11,910 13,430 12,380
FLEX SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years to Date To Date
-1.59% 2.85% 3.38% 17.97% Without load
-3.49% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Georgia Lehman 10-Year Lipper Georgia
Tax-Exempt Bond Fund, Municipal Municipal
Flex Shares Bond Index Debt Funds Average
Cumulative Returns ($)
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 11,286
5/31/98 11,850 12,456 12,344
5/31/99 12,161 13,032 12,744
5/31/00 11,968 13,008 12,365
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 CLASSIC HIGH INCOME FUND
--------------------------------------------------------------------------------
The STI Classic High Income Fund commenced operations on March 28, 2000 as the
successor to the ESC Strategic Income Fund, which merged into the STI Classic
High Income Fund (the "Fund") on that date. The Fund seeks a high level of
current income, with a secondary objective of total return. The Fund seeks to
achieve its investment objective by investing primarily in high yield debt
instruments of U.S. and foreign issuers that are rated below investment grade.
(Prior to September 30, 1998, this Fund primarily invested in a diversified
portfolio of corporate, government and other debt instruments of U.S. issuers.)
Market volatility and investor preference for aggressive equity funds resulted
in flows out of income funds in the past year, and this Fund was no exception.
Transaction costs associated with meeting substantial outflows hurt the Fund's
performance relative to its benchmark. For the fiscal year ended May 31, 2000,
the total return for the Fund (Flex Shares) was -10.21% versus -3.21% for the
Lehman U.S. Corporate High Yield Bond Index. The Index is not actively managed,
and does not include expenses.
The Fund's position in liquid assets was increased to meet withdrawals and to
facilitate the merger, but we anticipate a more stable asset base in the future.
Furthermore, the liquid assets will provide an opportunity to reinvest in
securities with better underlying fundamental trends and return opportunities
that are consistent with the STI Classic High Income Fund's investment strategy.
We will use a "bottom up" investment approach, identifying investment
opportunities based on the underlying financial and economic fundamentals of the
specific issuer.
/s/ signature omitted
Agnes G. Pampush, CFA
First Vice President
6
<PAGE>
FLEX SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
<TABLE>
<CAPTION>
Annualized Cumulative
Inception Inception
Two Months One Year 3 Years 5 Years to Date To Date
<S> <C> <C> <C> <C> <C> <C>
-0.13% -10.21% -0.10% 1.72% 3.03% 19.87%
-2.11% -11.86% With Load
</TABLE>
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
Cumulative Returns ($)
STI Classic Lehman
High Income Fund, U.S. Corporate
Flex Shares High Yield Bond Index
5/31/94 $10,000 $10,000
5/31/95 11,035 11,348
5/31/96 11,407 12,423
5/31/97 12,055 14,070
5/31/98 12,853 15,830
5/31/99 13,385 15,863
5/31/00 12,018 15,353
(1) Returns prior to March 27, 2000 represent the performance of the ESC
Strategic Income Fund, Class A Shares.
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 INVESTMENT GRADE BOND FUND
--------------------------------------------------------------------------------
The STI Investment Grade Bond Fund (the "Fund") seeks to provide a high level of
total return through current income and capital appreciation as is consistent
with the preservation of capital primarily through investment in investment
grade fixed income securities. The total return includes not only the current
income but also changes in value of the assets held by the Fund. For the year
ended May 31, 2000 the Fund's Trust Shares had a total return of -1.76% versus
an average return of 1.00% for the Lipper Intermediate Investment Grade Debt
Objective. The Lehman U.S. Government/Corporate Bond Index and the Lehman U.S.
Aggregate Bond Index (which unlike the Fund, have no expenses) had returns of
1.89% and 2.10%, respectively.
Interest rates generally rose over the last year as stronger than expected
economic growth continued and inflation concerns rose. The Federal Reserve
increased short-term interest rates in an effort to slow economic growth and
prevent inflationary pressures from building. Also, during the period the
Treasury began a program to buy back Treasury debt with a portion of the budget
surplus and focused on the longer-term securities. The result was higher
interest rates, an inverted yield curve [interest rates on shorter maturities
higher that those on longer maturities] and much wider yields spreads for
corporate and mortgage securities. Over the period, two year Treasury yields
rose from 5.43% to 6.69%, and thirty year Treasury yields rose from 5.84% to
6.02%.
The Fund performed well through the end of March as duration adjustments and
Treasury positions added to total return. During April and May, spread widening
in corporate securities substantially reduced the Fund's total return. Treasury
securities have performed well over the last year as the Treasury buy-back
program has focused attention on the dwindling supply of Treasury debt. The Fund
is underweighted in mortgage securities and overweighted in corporate positions.
Looking forward, as the Federal Reserve slows the economy and reduces inflation
concerns, fixed income securities should perform well. The Fund continues to be
managed with only moderate shifts in average maturity [duration]. The total
return of the Fund is enhanced through yield curve analysis [monitoring and
analyzing the risk/reward trade off of different maturity sectors], sector
rotation, credit analysis, and other low risk strategies. By actively pursuing
these strategies the Fund strives to add to total return while reducing risk.
/s/ signature omitted
L. Earl Denney, CFA
Senior Vice President
8
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
-1.76% 4.34% 4.80% 5.52% 52.71%
[GRAPHIC OMITTED]
PLOTS POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
<TABLE>
<CAPTION>
STI Classic Investment Grade Lehman U.S. Lipper Intermediate
Bond Fund, Government/Corporate Investment Grade
Trust Shares Bond Index Debt Objective
Cumulative Returns ($)
<S> <C> <C> <C>
7/31/92 $10,000 $10,000 $10,000
5/93 10,736 10,788 10,725
5/94 10,861 10,897 10,804
5/95 11,990 12,162 11,913
5/96 12,472 12,660 12,365
5/97 13,344 13,661 13,318
5/98 14,801 15,229 14,651
5/99 15,430 15,847 15,143
5/00 15,158 16,147 15,295
</TABLE>
INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
-2.17% 3.93% 4.39% 5.21% 49.91% Without load
-5.81% 2.60% 3.59% 4.70% 44.29% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Investment Grade Lehman U.S. Lipper Intermediate
Bond Fund, Government/Corporate Investment Grade
Investor Shares Bond Index Debt Objective
Cumulative Returns ($)
6/30/92 $ 9,625 $10,000 $10,000
5/93 10,486 11,064 10,978
5/94 10,576 11,176 11,058
5/95 11,638 12,473 12,984
5/96 12,045 12,984 12,656
5/97 12,847 14,010 13,632
5/98 14,195 15,619 14,997
5/99 14,743 16,253 15,501
5/00 14,423 16,560 15,656
FLEX SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years to Date To Date
-2.63% 3.44% 3.80% 20.39% Without load
-4.48% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Investment Grade Lehman U.S. Lipper Intermediate
Bond Fund, Government/Corporate Investment-Grade
Investor Shares Bond Index Debt Objective
Cumulative Returns ($)
6/30/95 $10,000 $10,000 $10,000
5/96 10,232 10,327 10,316
5/97 10,862 11,143 11,111
5/98 11,948 12,422 12,223
5/99 12,348 12,927 12,634
5/00 12,023 13,171 12,761
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 INVESTMENT GRADE TAX-EXEMPT BOND FUND
--------------------------------------------------------------------------------
The STI Classic Investment Grade Tax-Exempt Bond Fund (the "Fund") seeks to
provide high total return through (i) current income exempt from federal income
taxes and (ii) capital appreciation, while preserving the principal amount
invested by investing in investment grade tax-exempt obligations.
In the municipal bond funds 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 to emphasize cheap sectors of the
yield curve. Also, we take advantage of changes in yield spread. 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 credit
and avoid those credits that are deteriorating. The underlying concept to all
these techniques is to enhance total return without adding risk.
The Fund's Trust Shares return from June 1999 to May 2000 was 1.41% versus the
Lipper Intermediate Municipal Debt Average, which returned -1.04% for the same
period. The Lehman 5-Year Municipal Bond Index and the Lehman 5-Year General
Obligation Index returned 0.75% and 0.66%, respectively.
1999 continued to see the municipal yield curve flatten. The one-year AAA rated
municipal bond yield increased 85 basis points for the year; the 5-year AAA
rated municipal bond yield increased 88 basis points, and the 10 year and 20
year AAA rated bonds increased 87 and 92 basis points, respectively.
In the last half of 1999 the municipal market was dominated by concerns over
Y2K. Credit spreads continued to widen with the major credit concerns continuing
to come from the healthcare sector. In addition, the fourth quarter was
dominated by tax swapping, and the high net worth individual investor
reallocating from mutual funds into individual bonds in the intermediate area of
the curve. The reallocation of Property and Casualty companies from tax-exempt
products to corporate and agencies further reduced the institutional demand for
municipals.
On-line commerce exploded in 1999 characterized in municipals by the
aggressiveness of MuniAuction to make competitive and secondary transactions
Internet friendly. A variety of other firms also announced their services and
processes that would make municipal transactions on the web more accessible. The
challenge for 2000 will be providing the municipal market participants with
service and information that is convenient and easy to use.
The first quarter of 2000 was positive for municipals despite negative fund
flows and limited supply. New issue supply was down nearly 40% from the year
before, dramatically affecting activity in the market. As a result, the
secondary market continued to develop into a two-tier market. High quality bonds
remained liquid while lessor quality bonds received weak bids. The lack of
supply was especially burdensome for specialty states like California, Florida,
New York, and Tennessee, where paper is normally richer than the general market.
Because of the continued flattening of the yield curve, bond structure continues
to be an important factor. Twenty-year par bonds trading to a shorter call did
not participate as much in the market rally as compared to a discount or
non-call bond of the same maturity, which saw substantial principal gains.
The portfolio has benefited from our exposure to the 15-20 year area of the
curve where we focused on purchasing deep discounts and noncall bonds.
We continue to emphasize high quality, good structure bonds and will continue to
employ a barbell strategy. Long duration paper will continue to be scarce;
therefore non-call and deep discount bonds will continue to be core holdings.
/s/ signature omitted
Ronald H. Schwartz, CFA, CFP
Senior Vice President
10
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date to Date
1.41% 4.84% 5.49% 5.49% 42.39%
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
<TABLE>
<CAPTION>
STI Classic Investment Grade Lehman 5-Year Lehman 5-Year Lipper Intermediate
Tax-Exempt Bond Fund, Municipal General Obligation Municipal
Trust Shares Bond Index Index Debt Average
Cumulative Returns ($)
<S> <C> <C> <C> <C>
10/31/93 $10,000 $10,000 $10,000 $10,000
5/94 9,976 9,894 9,943 9,831
5/95 10,995 10,600 10,627 10,536
5/96 11,634 11,092 11,131 10,962
5/97 12,462 11,755 11,807 11,666
5/98 13,530 12,543 12,629 12,543
5/99 14,162 13,145 13,248 13,012
5/00 14,362 13,243 13,335 12,877
</TABLE>
INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
0.90% 4.39% 5.05% 6.50% 65.30% Without load
-2.86% 3.06% 4.25% 5.99% 59.09% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
<TABLE>
<CAPTION>
STI Classic Investment Grade Lehman 5-Year Lehman 5-Year Lipper Intermediate
Tax-Exempt Bond Fund, Municipal General Obligation Municipal
Investor Shares Bond Index Index Debt Average
Cumulative Returns ($)
<S> <C> <C> <C> <C>
6/30/92 $ 9,625 $10,000 $10,000 $10,000
5/93 10,731 10,775 10,778 10,898
5/94 11,309 11,088 11,112 11,231
5/95 12,429 11,879 11,877 12,037
5/96 13,101 12,430 12,440 12,524
5/97 13,977 13,174 13,196 13,328
5/98 15,101 14,056 14,114 14,330
5/99 15,758 14,731 14,806 14,866
5/00 15,900 14,841 14,904 14,711
</TABLE>
FLEX SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years to Date To Date
0.52% 3.89% 4.56% 24.92% Without load
-1.40% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE As FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
<TABLE>
<CAPTION>
STI Classic Investment Grade Lehman 5-Year Lehman 5-Year Lipper Intermediate
Tax-Exempt Bond Fund, Municipal General Obligation Municipal
Flex Shares Bond Index Index Debt Average
Cumulative Returns ($)
<S> <C> <C> <C> <C>
6/30/95 $10,000 $10,000 $10,000 $10,000
5/96 10,541 10,446 10,465 10,453
5/97 11,193 11,071 11,102 11,125
5/98 12,033 11,812 11,874 11,961
5/99 12,487 12,379 12,456 12,409
5/00 12,522 12,472 12,539 12,279
</TABLE>
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
The line graphs compare the Fund's returns to those of the Lehman 5-Year
Municipal Bond Index. Previously, the Fund's returns had been compared to the
Lehman 5-Year General Obligation Index, but the adviser believes that the
Lehman 5-Year Municipal Bond Index, because of its emphasis on revenue bonds as
well as general obligation bonds, more accurately reflects the types of
securities in which the Fund invests.
11
<PAGE>
STI CLASSIC LIMITED-TERM FEDERAL MORTGAGE SECURITIES FUND
--------------------------------------------------------------------------------
The one-year investment period ending in May was not a particularly fruitful one
for fixed income investors. Economic prosperity of historic proportion resulted
in GDP growth well above the Federal Reserve's targeted, non-inflationary growth
rate. As a result, the Federal Reserve raised the Federal Funds rate six times
bringing rates from 4.75% to 6.5%. This activity resulted in generally higher
rates across the bond market and a general decline in bond prices. With such
vibrant growth, corporate and individual prosperity yielded an unexpected
windfall of tax receipts to the U.S. Treasury. With the budget in surplus, the
Treasury announced a buy back program that would retire a significant amount of
outstanding treasury debt. As a result, Treasuries were the best performing
sector of the fixed income market.
The STI Classic Limited-Term Federal Mortgage Securities Fund's (the "Fund")
Trust Shares returned 2.33% for the year ended May 31, 2000 versus the Merrill
Lynch 1-5 Year U.S. Treasury Index and the Lipper Short/Intermediate U.S.
Government Average which returned 3.80% and 2.11%, respectively. The
preponderance of incremental return was achieved by a successful sector rotation
strategy that had the Fund heavily invested in income-earning, agency mortgage
securities for the first half of the investment period, which were then sold to
purchase a defensive position of cash and intermediate-term maturity Treasuries.
Prospects for both Fannie Mae and Freddie Mac straight issue debts as well as
mortgage collateral are beginning to look attractive again on a relative value
basis, as these securities begin to reflect the full risk of potential
regulation changes. The Fund's manager will continue to monitor the relative
value and likely return prospects of these securities, as congressional debate
over re-regulation of Government sponsored entities continues.
The high level of income and minimum exposure to credit risk produced by the
fund investments in balance should continue to provide investors with good
return prospects relative to other fixed income investment options.
/s/ signature omitted
David E. West, CFA
Senior Vice President
12
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
2.33% 4.71% 5.08% 5.49% 37.73%
[GRAPHIC OMITTED]
PLOT POINT ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
<TABLE>
<CAPTION>
STI Classic Limited-Term Federal Merrill Lynch Lipper Short/
Mortgage Securities Fund, 1-5 Year U.S. Intermediate U.S.
Trust Shares Treasury Index Government Average
Cumulative Returns ($)
<S> <C> <C> <C>
6/30/94 $10,000 $10,000 $10,000
5/95 10,756 10,809 10,744
5/96 11,276 11,341 11,189
5/97 12,002 12,110 11,917
5/98 12,856 13,040 12,790
5/99 13,467 13,722 13,289
5/00 13,780 14,243 13,569
</TABLE>
INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
1.93% 4.43% 4.81% 5.36% 35.88% Without load
-0.57% 3.54% 4.28% 4.90% 32.43% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
<TABLE>
<CAPTION>
STI Classic Limited-Term Federal Merrill Lynch Lipper Short/
Mortgage Securities Fund, 1-5 Year U.S. Intermediate U.S.
Investor Shares Treasury Index Government Average
<S> <C> <C> <C>
7/31/94 $10,000 $10,000 $10,000
5/95 10,440 10,697 10,636
5/96 10,919 11,223 11,078
5/97 11,593 11,984 11,798
5/98 12,398 12,904 12,662
5/99 12,953 13,579 13,156
5/00 13,203 14,095 13,434
</TABLE>
FLEX SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years to Date To Date
1.71% 4.09% 4.44% 24.14% Without load
-0.22% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Limited-Term Federal Merrill Lynch Lipper Short/
Mortgage Securities Fund, 1-5 Year U.S. Intermediate U.S.
Flex Shares Treasury Index Government Average
6/30/95 $10,000 $10,000 $10,000
5/96 10,393 10,431 10,361
5/97 10,996 11,139 11,035
5/98 11,709 11,994 11,844
5/99 12,194 12,621 12,306
5/00 12,402 13,101 12,565
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 MARYLAND MUNICIPAL BOND FUND
--------------------------------------------------------------------------------
This marks the first anniversary of the STI Classic Maryland Municipal Bond Fund
(the "Fund") as a member of the STI Classic family of mutual funds, and it is
one we are proud to celebrate. STI Classic Funds are a diversified group of
mutual funds, including stock, bond and money market funds with investment
styles within each asset class designed to meet the needs of our clients.
The Fund is a long-term maturity bond fund that invests in tax-exempt bonds
primarily from the state of Maryland. The Fund seeks to maximize tax-free
investment income for our clients, using a diversified mix of high-quality
securities representing the various state and local entities within the state.
The past year has been remarkable for the economy, as the length of the current
expansion reached an all-time record. Consumer spending remained robust through
much of the period, while the industrial and manufacturing side of the economy
rebounded on signs of global recovery. These factors helped generate new jobs
and new tax revenue for state and local governments in Maryland and across the
nation.
Unfortunately, the Federal Reserve (the "Fed") became concerned that the pace of
growth might push inflation higher if left unchecked. So it spent much of the
past year raising short-term interest rates in an attempt to cool the red-hot
consumer. This provided a challenging market for bond investors of all
persuasions and municipal bond investors in particular.
The Fund, with its heavy emphasis on generating high levels of tax-free income,
shared in the overall municipal market decline. However, we continued to
emphasize high-quality securities from well-managed entities; entities that we
believe will weather the more restrictive climate created by the Fed. The Fund's
Trust Shares returned -1.78% for the year ended May 31, 2000 versus -0.50% for
the Lehman General Obligation Index.
The outlook for the coming fiscal year is encouraging. The economy appears to be
showing early signs that the interest rate hikes of the past year may be slowing
the interest sensitive areas of the economy. This could reduce the risk of a
sharp acceleration in inflation and limit further interest rate increases by the
Fed. We are also encouraged that investors have begun to return to bonds as an
important element of a well-diversified portfolio.
We want to take this opportunity to thank you for choosing the STI Classic
Maryland Municipal Bond Fund as part of your portfolio. We will continue to
invest to maximize tax-exempt income with a portfolio of high-quality
securities, and we look forward to what we believe will be a more favorable year
for bond investors.
/s/ signature omitted
Robert S. Bowman, CFA
Vice President
14
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years to Date To Date
-1.78% 3.71% 3.00% 13.39%
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Maryland Lehman
Municipal Bond Fund, General Obligation
Trust Shares(1) Bond Index
Cumulative Returns ($)
3/31/96 $10,000 $10,000
5/96 9,846 9,949
5/97 10,500 10,767
5/98 11,443 11,734
5/99 11,923 12,300
5/00 11,710 12,239
FLEX SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years to Date To Date
-2.66% 2.80% 3.29% 14.18% Without load
-4.54% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Maryland Lehman
Municipal Bond Fund, General Obligation
Flex Shares(1) Bond Index
4/30/96 $10,000 $10,000
5/96 9,936 9,984
5/97 10,514 10,805
5/98 11,366 11,775
5/99 11,735 12,344
5/00 11,423 12,282
(1) Returns prior to May 24, 1999 represent the performance of the CrestFund
Maryland Municipal Bond Fund.
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 SHORT-TERM BOND FUND
--------------------------------------------------------------------------------
The investment objective of the STI Classic Short-Term Bond Fund (the "Fund") is
to provide high current income while preserving 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 moderate 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 offers 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 over the last twelve months was 2.87% (Trust
Shares), as compared to 4.11% for the Salomon 1-3 Year Treasury/Government
Sponsored/Corporate Index (the "Index"). The Index is not actively managed, and
does not include expenses. Tighter monetary policy pushed up interest rates in
past year, hurting the Fund's return. During the year ended May 31, 2000, the
Fund had a significant portion of its portfolio invested in corporate securities
in an effort to enhance the Fund's yield. Corporates underperformed treasuries
during that period, which negatively impacted the Fund's performance. However,
we believe that in the long-term this strategy will enable us to achieve the
Fund's objective.
/s/ signature omitted
Agnes G. Pampush, CFA
First Vice President
16
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date to Date
2.87% 4.73% 4.98% 4.91% 41.30%
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Short-Term Salomon 1-3 Year
Bond Fund, Treasury/Government
Trust Shares Sponsored/Corporate Index
Cumulative Returns ($)
3/31/93 $10,000 $10,000
5/93 10,035 10,039
5/94 10,238 10,260
5/95 11,016 11,021
5/96 11,506 11,614
5/97 12,231 12,384
5/98 13,125 13,254
5/99 13,658 13,968
5/00 14,050 14,542
INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
2.67% 4.56% 4.78% 4.64% 38.57% Without load
-0.65% 3.87% 4.36% 4.34% 35.73% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Short-Term Salomon 1-3 Year
Bond Fund, Treasury/Government
Investor Shares Sponsored/Corporate Index
Cumulative Returns ($)
3/31/93 $ 9,800 $10,000
5/93 9,838 10,039
5/94 10,017 10,260
5/95 10,762 11,021
5/96 11,218 11,614
5/97 11,887 12,384
5/98 12,742 13,254
5/99 13,236 13,968
5/00 13,590 14,542
FLEX SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
CUMULATIVE RETURNS ($)
Annualized Cumulative
Inception Inception
One Year 3 Years to Date To Date
2.31% 4.20% 4.41% 23.72% Without load
0.36% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Short-Term Salomon 1-3 Year
Bond Fund, Treasury/Government
Flex Shares Sponsored/Corporate Index
Cumulative Returns ($)
6/30/95 $10,000 $10,000
5/96 10,359 10,481
5/97 10,941 11,176
5/98 11,689 11,962
5/99 12,098 12,606
5/00 12,378 13,124
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 SHORT-TERM U.S. TREASURY SECURITIES FUND
--------------------------------------------------------------------------------
The investment objective of the STI Classic Short-Term U.S. Treasury Securities
Fund (the "Fund") is to provide high current income while preserving 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.
Total returns for fixed income securities and fixed income funds were negatively
impacted by rising interest rates during the one year period ending May 31,
2000. The Fund had a total return of 3.75% (Trust Shares) for the one year
period. The Fund maintained a shorter than average maturity for most of the
period which allowed the Fund to outperform the Salomon 1-3 Year Treasury Index
(the "Index"). The Index (which does not include fees or expenses) had a 4.12%
total return for the same period.
/s/ signature omitted
David S. Yealy
Vice President
18
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
3.75% 4.87% 5.02% 4.69% 39.17%
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
<TABLE>
<CAPTION>
STI Classic Short-Term U.S. Salomon Salomon
Treasury Securities Fund, 1-3 Year 6-Month Treasury
Trust Shares Treasury Index Bill Index
Cumulative Returns ($)
<S> <C> <C> <C>
3/31/93 $10,000 $10,000 $10,000
5/93 10,024 10,036 10,053
5/94 10,242 10,244 10,391
5/95 10,868 10,991 10,953
5/96 11,382 11,523 11,554
5/97 12,038 12,333 12,176
5/98 12,796 13,194 12,837
5/99 13,384 13,896 13,474
5/00 13,885 14,467 14,180
</TABLE>
INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
3.58% 4.71% 4.85% 4.53% 37.58% Without load
2.55% 4.36% 4.64% 4.38% 36.22% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
<TABLE>
<CAPTION>
STI Classic Short-Term U.S. Salomon Salomon
Treasury Securities Fund, 1-3 Year 6-Month Treasury
Investor Shares Treasury Index Bill Index
<S> <C> <C> <C>
3/31/93 $ 9,900 $10,000 $10,000
5/31/93 9,921 10,036 10,053
5/31/94 10,122 10,244 10,391
5/31/95 10,732 10,991 10,953
5/31/96 11,217 11,523 11,554
5/31/97 11,844 12,333 12,176
5/31/98 12,559 13,194 12,837
5/31/99 13,130 13,896 13,474
5/31/00 13,599 14,467 14,180
</TABLE>
FLEX SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years to Date To Date
3.34% 4.51% 4.51% 24.30% Without load
1.36% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
<TABLE>
<CAPTION>
STI Classic Short-Term U.S. Salomon Salomon
Treasury Securities Fund, 1-3 Year 6-Month Treasury
Flex Shares Treasury Index Bill Index
<S> <C> <C> <C>
6/30/95 $10,000 $10,000 $10,000
5/96 10,357 10,428 10,500
5/97 10,894 11,161 11,065
5/98 11,537 11,940 11,666
5/99 12,036 12,576 12,244
5/00 12,438 13,092 12,886
</TABLE>
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
19
<PAGE>
STI CLASSIC U.S. GOVERNMENT SECURITIES FUND
--------------------------------------------------------------------------------
The objective for the STI Classic U.S. Government Securities Fund (the "Fund")
is to provide high current income while preserving capital by investing in
obligations issued or guaranteed by the U.S. Government or its agencies or
instrumentalities. The Fund met its objectives for the fiscal year of operations
ending May 31, 2000. Approximately 86% of the Fund's assets were invested in
Government Agency mortgage-backed securities with the balance invested in U.S.
Government Securities. The Fund had a 30-day yield of 6.3%.
During the 12-month period ending May 31, 2000, interest rates rose
significantly as the Federal Reserve pursued an aggressive tightening policy,
which negatively impacted total return. In addition, the incremental yield
spreads offered by mortgage-backed securities widened significantly, and we have
used this opportunity to increase our exposure to this sector. The Fund's total
return (Trust Shares) of 1.63% compares very favorably to the total return of
the Lipper Intermediate U.S. Government Funds Average of 1.33% for the 1 year
time period. The Merrill Lynch Government/Mortgage Index returned 2.81% for the
same period.
We believe the Federal Reserve is nearing the end of its tightening bias as
economic growth begins to slow and inflation remains controlled. The Fund is
well positioned to take advantage of this less volatile environment.
/s/ signature omitted
Charles B. Leonard, CFA
First Vice President
20
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
1.63% 5.36% 5.26% 5.99% 40.41%
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
<TABLE>
<CAPTION>
STI Classic U.S. Government Merrill Lynch Lipper Intermediate
Securities Fund, Government/Mortgage Government
Trust Shares Index* Funds Average
Cumulative Returns ($)
<S> <C> <C> <C>
6/30/94 $ 9,625 $10,000 $10,000
5/95 10,572 11,138 10,907
5/96 10,833 11,627 11,271
5/97 11,614 12,572 12,055
5/98 12,802 13,920 13,167
5/99 13,257 14,563 13,618
5/00 13,415 14,972 13,800
</TABLE>
INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date to Date
1.19% 4.92% 4.88% 5.50% 37.81% Without load
-2.60% 3.60% 4.08% 4.83% 32.64% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic U.S. Government Merrill Lynch Lipper Intermediate
Securities Fund, Government/Mortgage Government
Investor Shares Index* Funds Average
PLOT POINTS TO COME???
FLEX SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years to Date to Date
0.70% 4.42% 4.25% 23.02% Without load
-1.22% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic U.S. Government Merrill Lynch Lipper Intermediate
Securities Fund, Government/Mortgage Government
Investor Shares Index* Funds Average
Past performance is no indication of future performance.
The Funds' comparative benchmarks do not include the annual operating expenses
incurred by the Fund.
*The Merrill Government/Mortgage Index is a synthetic index created by
combining, at their respective market weights: (i) the Merrill Lynch
Government Master Index, which is a widely-recognized index comprised of U.S.
Treasury securities and U.S. Government agency securities with a maturity of
at least one year; and (ii) the Merrill Lynch Mortgage Master Index, which
is a widely-recognized market value-weighted index comprised of mortgage-
backed securities including 15 and 30 year single family mortgages in
addition to aggregate pooled mortgages.
21
<PAGE>
STI CLASSIC VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND
--------------------------------------------------------------------------------
This marks the first anniversary of the STIClassic Virginia Intermediate Bond
Fund (the "Fund") as a member of the STI Classic family of mutual funds, and it
is one we are proud to celebrate. STI Classic Funds are a diversified group of
mutual funds, including stock, bond and money market funds with investment
styles within each asset class designed to meet the needs of our clients.
The Fund is an intermediate term maturity bond fund that invests in tax-exempt
bonds primarily from the state of Virginia. The Fund seeks to maximize tax-free
investment income for our clients, using a diversified mix of high-quality
securities representing the various state and local entities within the
Commonwealth.
The past year has been remarkable for the economy, as the length of the current
expansion reached an all-time record. Consumer spending remained robust through
much of the period, while the industrial and manufacturing side of the economy
rebounded on signs of global recovery. These factors helped generate new jobs
and new tax revenue for state and local governments in Virginia and across the
nation.
Unfortunately, the Federal Reserve (the "Fed") became concerned that the pace of
growth might push inflation higher if left unchecked. So it spent much of the
past year raising short-term interest rates in an attempt to cool the red-hot
consumer. This provided a challenging market for bond investors of all
persuasions and municipal bond investors in particular.
The Fund, with its heavy emphasis on generating high levels of tax-free income,
shared in the overall municipal market decline. However, we continued to
emphasize high-quality securities from well-managed entities; entities that we
believe will weather the more restrictive climate created by the Fed. The Fund
(Trust Shares) returned -1.31% for the year ended May 31, 2000 versus the Lehman
5-Year General Obligation Index which returned -0.50%.
The outlook for the coming fiscal year is encouraging. The economy appears to be
showing early signs that the interest rate hikes of the past year may be slowing
the interest sensitive areas of the economy. This could reduce the risk of a
sharp acceleration in inflation and limit further interest rate increases by the
Fed. We are also encouraged that investors have begun to return to bonds as an
important element of a well-diversified portfolio.
We want to take this opportunity to thank you for choosing the STI Classic
Virginia Intermediate Municipal Bond Fund as part of your portfolio. We will
continue to invest to maximize tax-exempt income with a portfolio of
high-quality securities, and we look forward to what we believe will be a more
favorable year for bond investors.
/s/ signature
Robert S. Bowman, CFA
Vice President
22
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
-1.31% 3.12% 3.79% 4.08% 34.34%
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Virginia Intermediate Lehman 5-Year
Municipal Bond Fund, General Obligation
Trust Shares Bond Index
Cumulative Returns ($)
5/31/93 $10,000 $10,000
5/93 10,282 10,246
5/94 10,280 10,563
5/95 11,089 11,290
5/96 11,494 11,825
5/97 12,179 12,544
5/98 13,078 13,417
5/99 13,532 14,075
5/00 13,355 14,168
INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
-1.24% 3.18% 3.82% 3.73% 29.62% Without load
-4.97% 1.89% 3.03% 3.17% 24.75% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Virginia Intermediate Lehman 5-Year
Municipal Bond Fund, General Obligation
Investor Shares(1) Bond Index
5/31/93 $ 9,625 $10,000
5/94 9,623 10,310
5/95 10,369 11,019
5/96 10,746 11,542
5/97 11,386 12,243
5/98 12,236 13,096
5/99 12,664 13,737
5/00 12,507 13,828
(1) Returns prior to May 24, 1999 represent the performance of the CrestFund
Virginia Intermediate Municipal Bond Fund.
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 VIRGINIA MUNICIPAL BOND FUND
--------------------------------------------------------------------------------
This marks the first anniversary of the STI Classic Virginia Municipal Bond Fund
(the "Fund") as a member of the STI Classic family of mutual funds, and it is
one we are proud to celebrate. STI Classic Funds are a diversified group of
mutual funds, including stock, bond and money market funds with investment
styles within each asset class designed to meet the needs of our clients.
The Fund is a longer-term maturity bond fund that invests in tax-exempt bonds
primarily from the state of Virginia. The Fund seeks to maximize tax-free
investment income for our clients, using a diversified mix of high-quality
securities representing the various state and local entities within the
Commonwealth.
The past year has been remarkable for the economy, as the length of the current
expansion reached an all-time record. Consumer spending remained robust through
much of the period, while the industrial and manufacturing side of the economy
rebounded on signs of global recovery. These factors helped generate new jobs
and new tax revenue for state and local governments in Virginia and across the
nation.
Unfortunately, the Federal Reserve (the "Fed") became concerned that the pace of
growth might push inflation higher if left unchecked. So it spent much of the
past year raising short-term interest rates in an attempt to cool the red-hot
consumer. This provided a challenging market for bond investors of all
persuasions and municipal bond investors in particular.
The Fund, with its heavy emphasis on generating high levels of tax-free income,
shared in the overall municipal market decline. However, we continued to
emphasize high-quality securities from well-managed entities; entities that we
believe will weather the more restrictive climate created by the Fed. The Fund's
Trust Shares returned -3.18% for the fiscal year ended May 31, 2000 versus the
Lehman General Obligation Bond Index which returned -0.50%.
The outlook for the coming fiscal year is encouraging. The economy appears to be
showing early signs that the interest rate hikes of the past year may be slowing
the interest sensitive areas of the economy. This could reduce the risk of a
sharp acceleration in inflation and limit further interest rate increases by the
Fed. We are also encouraged that investors have begun to return to bonds as an
important element of a well-diversified portfolio.
We want to take this opportunity to thank you for choosing the STI Classic
Virginia Municipal Bond Fund as part of your portfolio. We will continue to
invest to maximize tax-exempt income with a portfolio of high-quality
securities, and we look forward to what we believe will be a more favorable year
for bond investors.
/s/ signature omitted
Robert S. Bowman, CFA
Vice President
24
<PAGE>
TRUST SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date to Date
-3.18% 3.17% 3.73% 4.17% 23.41%
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Virginia Lehman
Municipal Bond Fund, General Obligation
Trust Shares(1) Bond Index
Cumulative Returns ($)
4/30/95 $10,000 $10,000
5/95 10,333 10,298
5/96 10,568 10,779
5/97 11,302 11,665
5/98 12,356 12,712
5/99 12,820 13,326
5/00 12,412 13,260
INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS
(PERIODS ENDED MAY 31, 2000)
Annualized Cumulative
Inception Inception
One Year 3 Years 5 Years to Date To Date
-4.13% 2.25% 2.84% 3.17% 17.31% Without load
-5.98% With load
[GRAPHIC OMITTED]
PLOT POINTS ARE AS FOLLOWS:
COMPARISON OF CHANGE IN THE VALUE
OF A $10,000 INVESTMENT
STI Classic Virginia Lehman
Municipal Bond Fund, General Obligation
Flex Shares(1) Bond Index
Cumulative Returns ($)
4/30/95 $10,000 $10,000
5/95 10,336 10,298
5/96 10,480 10,779
5/97 11,121 11,665
5/98 12,051 12,712
5/99 12,400 13,326
5/00 11,888 13,260
(1) Returns prior to May 24, 1999 represent the performance of the CrestFund
Virginia Municipal Bond Fund.
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>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
FLORIDA TAX-EXEMPT BOND FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
MUNICIPAL BONDS (89.2%)
FLORIDA (79.5%)
Brevard County, Health Facilities
Authority, Holmes Regional
Medical Center Project, RB, MBIA
Callable 10/01/03 @ 102
5.700%, 10/01/08 $3,000 $ 3,038
Broward County, Port Facilities
Authority, Ser C, RB, AMT, MBIA
5.375%, 09/01/08 3,360 3,339
Citrus County, Pollution Control
Authority, Florida Power, Crystal
River, Ser B, RB Callable
08/01/02 @ 102
6.350%, 02/01/22 335 337
Dade County, Aviation, Ser A, RB,
AMBAC Callable 10/01/05 @ 102
6.000%, 10/01/09 500 520
Dade County, Aviation Revenue,
Ser B, RB, AMT, MBIA Callable
10/01/02 @ 102
6.600%, 10/01/22 825 844
Dade County, Educational Facilities
Authority, University of Miami,
Ser A, RB, MBIA
6.000%, 04/01/08 505 527
Dade County, Seaport, GO, MBIA
6.500%, 10/01/09 1,000 1,084
Dade County, Ser CC, GO, AMBAC
7.125%, 10/01/15 1,000 1,149
Daytona Beach, Water & Sewer
Authority, Ser 1978, RB, ETM
Callable 11/15/00 @ 101.75
6.750%, 11/15/07 1,000 1,050
Deerfield Beach, Water & Sewer
Authority, RB, FGIC
6.125%, 10/01/06 250 259
Florida State, Board of Education,
Capital Outlay, Public Education,
Ser B, GO Prerefunded @ 101(F)
6.000%, 06/01/01 1,000 1,022
Florida State, Board of Education,
Capital Outlay, Public Education,
GO Callable 06/01/02 @ 101
6.400%, 06/01/19 1,300 1,340
Florida State, Board of Education,
Capital Outlay, Ser A, GO
Callable 01/01/09 @ 101
4.750%, 01/01/19 1,860 1,579
Florida State, Board of Education,
Capital Outlay, Ser A, GO
6.100%, 06/01/00 125 125
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
FLORIDA--CONTINUED
Florida State, Board of Education,
Capital Outlay, Ser C, ETM, GO
Callable 06/22/00 @ 100
7.100%, 06/01/07 $ 190 $ 192
Florida State, Department of
Transportation, Right of Way,
Ser A, GO Callable 07/01/07 @ 101
5.000%, 07/01/22 500 434
Florida State, Finance Department
of General Services,
Environmental Preservation 2000,
Ser A, RB, AMBAC Callable
07/01/07 @ 101
5.000%, 07/01/13 1,200 1,138
Florida State, Finance Department
of General Services, Environmental
Protection, Ser B, RB, AMBAC
6.000%, 07/01/12 2,000 2,093
Florida State, Finance Department of
General Services, Save Our Coast,
Department of National Resources,
RB, MBIA Prerefunded @ 101 (F)
6.500%, 07/01/01 720 740
Florida State, Finance Department of
General Services, Department of
Natural Resources, Preservation
2000, Ser A, RB, AMBAC
Prerefunded @ 102 (F)
6.750%, 07/01/01 80 83
Florida State, Housing Financing
Authority, Homeowner Mortgage,
Ser 7, RB, AMT, FSA Callable
07/01/09 @ 100
5.200%, 01/01/31 1,000 977
Florida State, Ports Financing
Commission, Transportation
Trust Fund, RB, AMT, FGIC
Callable 10/01/09 @ 101
5.250%, 10/01/13 1,305 1,244
5.375%, 10/01/15 1,000 951
Florida State, Turnpike Authority,
Ser A, RB, FSA Callable
07/01/09 @ 101
5.000%, 07/01/22 3,545 3,083
Gainesville, Utility Systems,
Ser A, RB
5.750%, 10/01/04 1,000 1,026
Hillsborough County, Industrial
Development Authority,
University Community Hospital,
RB, MBIA
6.500%, 08/15/19 145 157
26
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
FLORIDA--CONTINUED
Indian, Trace Community, Community
Development District, Water
Management Split Benefit,
Ser A-1, RB, MBIA Callable
05/01/05 @ 102
5.500%, 05/01/07 $ 330 $ 335
Jacksonville, Excise Tax, Ser B, RB,
AMT, FGIC Callable
10/01/01 @ 101
5.200%, 10/01/04 1,500 1,499
Jacksonville, Sales Tax Authority,
River City Renaissance Project,
RB, FGIC
6.000%, 10/01/04 2,430 2,517
Keys, Aqueduct Authority, RB,
AMBAC Prerefunded @ 101(F)
6.750%, 09/01/01 170 176
Lakeland, Electric & Water Authority,
First Lien, Ser B, RB, FSA
6.550%, 10/01/05 2,590 2,753
Lakeland, Electric & Water Authority,
First Lien, Ser C, RB, FSA
6.050%, 10/01/07 1,000 1,050
Lee County, Industrial Development
Authority, Bonita Springs Utilities
Project, RB, AMT, MBIA Callable
11/01/06 @ 101
5.750%, 11/01/10 1,480 1,498
Lee County, Water & Sewer
Authority, Ser A, RB, AMBAC
Callable 10/01/09 @ 101
4.750%, 10/01/19 1,720 1,460
Miami, Parking Facilities Authority,
RB, MBIA
5.250%, 10/01/15 1,000 959
Miami-Dade County, Educational
Authority, Ser A, RB, AMBAC
Callable 04/01/10 @ 101
5.500%, 04/01/19 1,405 1,346
North Broward, Hospital District,
RB, ETM, MBIA
5.950%, 01/01/01 1,000 1,008
Orange County, Health Facilities
Authority, Ser A, RB, ETM, MBIA
6.250%, 10/01/07 2,120 2,245
Orlando, Aviation Authority, Airport
Facilities, RB, AMT, FGIC
5.250%, 10/01/13 725 692
5.500%, 10/01/17 1,810 1,755
Orlando, Aviation Authority, Airport
Facilities, Ser A, RB, AMT, AMBAC
Callable 10/01/03 @ 102
5.400%, 10/01/06 1,340 1,344
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
FLORIDA--CONTINUED
Orlando, Utilities Commission
Water & Sewer Authority,
Sub-Ser D, RB
6.750%, 10/01/17 $5,385 $ 5,991
Osceola County, School Board
Certificates Authority, Ser A,
COP, AMBAC
6.250%, 06/01/01 1,080 1,097
Palm Beach County, Acquisitions
Program Authority, Ser B, GO
Callable 08/01/09 @101
5.375%, 08/01/15 1,000 968
Palm Beach County, Apartment
System Authority, RB, MBIA
Callable 10/01/01 @ 102
7.625%, 10/01/04 1,410 1,482
Palm Beach County, Solid Waste
Authority, Ser A, RB, ETM, AMBAC
6.000%, 10/01/09 300 315
Pensacola, Airport Authority,
Ser A, RB, AMT, MBIA
6.250%, 10/01/09 505 532
Pensacola, Airport Authority,
Ser A, RB, AMT, MBIA
Callable 10/01/08 @ 102
6.000%, 10/01/12 1,075 1,102
Pinellas County, Health Facilities
Authority, Morton Plant Health
Systems Project, RB, MBIA
Callable 11/15/03 @ 102
5.500%, 11/15/08 1,500 1,506
Plant City, Utility System, RB, MBIA
6.000%, 10/01/15 400 418
Polk County, Utility System,
RB, ETM, FGIC
6.000%, 10/01/08 2,250 2,329
Reedy Creek, Improvement District,
Ser 1991-1, RB, MBIA
Prerefunded @ 101(F)
6.250%, 10/01/01 405 416
South Broward, Hospital District
Authority, RB, AMBAC Callable
05/01/03 @ 102
7.500%, 05/01/08 1,000 1,078
Sunrise, Utility System Authority,
RB, AMBAC Callable
10/01/18 @ 100
5.000%, 10/01/28 1,500 1,292
Tallahassee, Energy Systems
Authority, Ser A, RB, FSA
Callable 10/01/08 @ 101
5.000%, 10/01/28 5,040 4,286
27
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
FLORIDA TAX-EXEMPT BOND FUND--CONCLUDED
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
FLORIDA--CONTINUED
Tampa, Allegany Health Systems
Authority, St Mary's Hospital,
RB, ETM, MBIA Callable
12/01/03 @ 102
5.000%, 12/01/12 $7,280 $ 6,960
Tampa, Guaranteed Entitlement, RB,
AMBAC Callable 10/01/01 @ 102
7.050%, 10/01/07 1,000 1,045
Tampa, Special Utility, TA, AMBAC
Callable 10/01/01 @ 102
6.900%, 10/01/09 1,500 1,564
Tampa, Sports Authority, Local
Option Sales Tax, Stadium Project,
RB, MBIA Callable 01/01/07 @ 101
5.250%, 01/01/27 3,000 2,688
--------
84,037
--------
PUERTO RICO (9.7%)
Commonwealth, Aqueduct & Sewer
Authority, RB, MBIA
6.250%, 07/01/12 1,000 1,076
Commonwealth, Electric Power
Authority, Ser S, RB
5.500%, 07/01/00 200 200
Commonwealth, Electric Power
Authority, Ser X, RB
Prerefunded @ 102 (F)
6.125%, 07/01/05 240 258
Commonwealth, Highway &
Transportation Authority,
Ser Z, RB, MBIA
6.250%, 07/01/14 3,000 3,228
Commonwealth, Municipal Financing
Agency, Ser A, GO, FSA
Callable 08/01/09 @ 101
5.500%, 08/01/23 2,340 2,231
Commonwealth, Public Buildings
Authority, Government Facilities,
Ser A, RB, AMBAC
6.250%, 07/01/13 1,000 1,077
6.250%, 07/01/14 750 807
Commonwealth, Public
Improvements, GO, MBIA
Callable 07/01/07 @ 100
5.375%, 07/01/25 1,500 1,390
--------
10,267
--------
Total Municipal Bonds
(Cost $96,770) 94,304
--------
--------------------------------------------------------------------------------
SHARES VALUE (000)
--------------------------------------------------------------------------------
CASH EQUIVALENTS (8.6%)
AIM Management Institutional
Tax Free Fund 4,512,541 $ 4,513
SEI Institutional Tax Free Fund 4,576,465 4,576
--------
Total Cash Equivalents
(Cost $9,089) 9,089
--------
Total Investments (97.8%)
(Cost $105,859) 103,393
--------
OTHER ASSETS AND LIABILITIES, NET (2.2%) 2,313
--------
NET ASSETS:
Fund shares of Trust Shares (unlimited
authorization -- no par value) based
on 9,244,819 outstanding shares of
beneficial interest 97,121
Fund shares of Investor Shares (unlimited
authorization -- no par value) based
on 285,455 outstanding shares of
beneficial interest 2,838
Fund shares of Flex Shares (unlimited
authorization -- no par value) based
on 970,788 outstanding shares of
beneficial interest 10,500
Distributions in excess of net
investment income (5)
Accumulated net realized loss
on investments (2,282)
Net unrealized depreciation
on investments (2,466)
--------
Total Net Assets (100.0%) $105,706
========
Net Asset Value and Redemption
Price Per Share -- Trust Shares $ 10.06
========
Net Asset Value and Redemption
Price Per Share -- Investor Shares $ 10.07
========
Maximum Offering Price Per Share --
Investor Shares ($10.07 / 96.25%) $ 10.46
========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 10.09
========
(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 56.
28
<PAGE>
--------------------------------------------------------------------------------
GEORGIA TAX-EXEMPT BOND FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
MUNICIPAL BONDS (93.5%)
GEORGIA (93.5%)
Albany-Dougherty County, State
Hospital Authority, Ser B, RB,
AMBAC Prerefunded @ 102 (F)
7.500%, 09/01/00 $ 255 $ 262
Athens, Water & Sewer
Authority, RB, ETM
5.700%, 07/01/00 165 165
Atlanta, Airport Facilities
Authority, RB, AMBAC
6.000%, 01/01/03 1,000 1,021
6.000%, 01/01/04 500 514
6.500%, 01/01/06 1,000 1,058
Atlanta, Water & Sewer
Authority, RB, ETM
6.000%, 01/01/11 1,000 1,044
Augusta, Water & Sewer
Authority, RB Prerefunded
@ 102 (F)
6.200%, 05/01/02 130 135
Bibb County, GO
7.000%, 01/01/04 985 1,043
Brunswick, Water & Sewer
Authority, RB, MBIA
6.100%, 10/01/14 1,000 1,051
Carroll County, Water Authority,
RB, AMBAC Callable
07/01/09 @ 102
5.000%, 07/01/10 720 693
Catoosa, Utility District Authority,
RB, MBIA Callable
04/01/09 @ 102
5.000%, 04/01/12 710 670
Cherokee County, School System, GO
5.000%, 02/01/12 1,690 1,611
5.000%, 02/01/13 1,370 1,297
Clarke County, Hospital Authority,
Athens Regional Medical Center
Project, RB, MBIA
5.375%, 01/01/07 1,425 1,431
Clayton County, Water & Sewer
Authority, RB, AMBAC Callable
05/01/06 @ 102
5.350%, 05/01/09 800 800
Cobb County, Water & Sewer
Authority, RB Callable
07/01/04 @102
5.125%, 07/01/06 1,000 998
Cobb-Marietta County, Coliseum
& Expo Project, RB, MBIA
5.500%, 10/01/12 940 939
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
GEORGIA--CONTINUED
Cobb-Marietta County, Water
Authority, RB
5.000%, 11/01/03 $ 1,255 $ 1,252
5.100%, 11/01/04 1,000 1,000
Columbia County, Courthouse/
Detention Center Projects, GO
Callable 02/01/08 @ 102
5.000%, 02/01/10 720 690
Dalton, Utilities Authority, RB, MBIA
6.000%, 01/01/08 3,240 3,380
Dalton-Whitfield County, Hospital
Authority, RB Prerefunded
@ 102 (F)
7.000%, 07/01/00 355 363
DeKalb County, Development
Authority, Emory University
Project, Ser A, RB
5.375%, 11/01/05 1,650 1,669
DeKalb County, Development
Authority, Emory University
Project, Ser A, RB Callable
11/01/05 @ 101
5.200%, 11/01/08 500 498
DeKalb County, School District,
Ser A, GO
6.250%, 07/01/11 1,500 1,609
Douglasville - Douglas County,
Water & Sewer Authority, RB,
AMBAC
5.625%, 06/01/15 1,370 1,381
Fayette County, School District,
GO, ETM
6.250%, 03/01/07 450 474
Fayette County, Water Authority,
Ser 1985-A, RB, ETM, MBIA
Callable 10/01/00 @ 100
8.550%, 10/01/01 300 314
Forsyth County, Water & Sewer
Authority, RB
5.000%, 04/01/04 1,000 996
Forsyth County, Water & Sewer
Authority, RB, Callable
04/01/08 @ 101
5.000%, 04/01/09 1,000 971
Forsyth County, School District,
GO Callable 02/01/10 @ 102
5.750%, 02/01/11 3,000 3,062
6.000%, 02/01/15 1,000 1,024
Forsyth County, School District, GO
6.400%, 07/01/05 750 790
6.500%, 07/01/06 1,000 1,064
29
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
GEORGIA TAX-EXEMPT BOND FUND--CONCLUDED
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
GEORGIA--CONTINUED
Forsyth County, School District,
GO, MBIA Prerefunded @ 102 (F)
5.350%, 07/01/05 $ 780 $ 800
Fulton County, Hospital Authority,
Northside Hospital Project, Ser B,
RB, MBIA Prerefunded @ 102 (F)
6.600%, 10/01/02 2,000 2,104
Fulton County, School District, GO
5.250%, 01/01/12 1,000 981
6.375%, 05/01/17 500 538
Fulton County, Water & Sewer
Authority, RB, ETM, FGIC
6.375%, 01/01/14 1,000 1,075
Georgia State, Ser A, GO
6.250%, 04/01/11 1,000 1,074
Georgia State, Ser C, GO
6.500%, 04/01/08 1,000 1,077
6.250%, 08/01/08 1,360 1,447
6.250%, 08/01/13 650 699
6.250%, 08/01/13 1,000 1,075
Georgia State, Ser D, GO
6.700%, 08/01/10 2,250 2,484
Georgia State, Housing & Financial
Authority, Single-Family Mortgage,
Sub-Ser B-1, RB Callable
06/01/05 @ 102
5.550%, 12/01/07 550 550
Georgia State, Housing & Financial
Authority, Single-Family Mortgage,
Sub-Ser B-1, RB, FHA
Callable 06/01/06 @ 102
5.550%, 12/01/10 325 324
5.600%, 12/01/11 450 448
Georgia State, Housing & Financial
Authority, Single-Family Mortgage,
Sub-Ser C-1, RB Callable
12/01/07 @ 101.50
5.550%, 12/01/16 500 481
Georgia State, Municipal Electric
Authority, RB, ETM Callable
06/22/00 @ 100
8.000%, 01/01/15 1,900 2,320
Gwinnett County, Recreation
Authority, RB
5.800%, 02/01/06 785 808
5.875%, 02/01/07 500 517
Gwinnett County, School District,
Ser B, GO
6.400%, 02/01/06 500 529
6.400%, 02/01/07 1,500 1,594
Hall County, School District,
Ser B, GO
6.300%, 12/01/05 675 710
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
GEORGIA--CONTINUED
Henry County, Henry Medical
Center Project, RB, AMBAC
Prerefunded @ 102 (F)
5.500%, 07/01/07 $ 1,640 $ 1,683
Henry County, Henry Medical
Center Project, RB, AMBAC
Callable 07/01/07 @ 102
5.500%, 07/01/08 545 550
Henry County, School District,
Ser A, GO
6.150%, 08/01/06 150 157
6.300%, 08/01/08 300 319
6.450%, 08/01/11 500 537
Henry County, School District,
Ser A, GO, MBIA
5.500%, 08/01/01 350 353
Henry County, Water & Sewer
Authority, RB, AMBAC
6.150%, 02/01/20 2,250 2,339
Houston County, School District,
Intergovernmental Contract,
COP, MBIA Prerefunded @ 102 (F)
6.000%, 03/01/04 2,000 2,094
Jackson County, School District,
GO Callable 07/01/08 @ 101
5.000%, 07/01/10 1,020 982
Medical Center Hospital Authority,
Columbus Regional Health Care
System, RB, MBIA
Prerefunded @ 102 (F)
6.000%, 08/01/05 1,340 1,410
Meriwether County, School District,
GO, FSA
7.000%, 02/01/06 740 802
Metropolitan Atlanta, Rapid
Transportation Authority,
Ser A, RB, MBIA
6.250%, 07/01/07 500 528
Metropolitan Atlanta, Rapid
Transportation Authority, Ser N, RB
6.000%, 07/01/07 1,000 1,035
Metropolitan Atlanta, Rapid
Transportation Authority,
Ser P, RB, AMBAC
6.250%, 07/01/08 1,000 1,060
Milledgeville, Water & Sewer
Authority, RB, FSA
6.000%, 12/01/16 1,000 1,032
6.000%, 12/01/21 1,000 1,013
30
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
GEORGIA--CONTINUED
Newton County, Hospital Authority,
Newton Health Systems Project,
RB, AMBAC Callable
02/01/10 @ 101
5.750%, 02/01/11 $ 780 $ 787
5.750%, 02/01/12 825 828
Paulding County, School District,
GO, MBIA
6.000%, 02/01/10 1,000 1,043
Paulding County, School District,
Ser A, GO
6.625%, 02/01/07 1,000 1,073
6.625%, 02/01/08 525 566
Private Colleges & Universities,
Agnes Scott College Project, RB,
MBIA Callable 06/01/09 @ 101
5.250%, 06/01/10 1,360 1,344
Private Colleges & Universities,
Emory University Project, Ser A,
RB, Callable 11/01/07 @ 101
5.000%, 11/01/10 1,000 962
Private Colleges & Universities,
Mercer University Project, RB,
ETM, MBIA
6.400%, 11/01/11 1,675 1,816
Private Colleges & Universities,
Mercer University Project, Ser A,
RB Callable 10/01/09 @ 101
5.250%, 10/01/13 1,000 915
Rome, Water & Sewer Authority,
RB, AMBAC
5.250%, 01/01/09 775 769
Savannah, Water & Sewer Authority,
RB, ETM Callable 12/01/00
6.450%, 12/01/04 1,000 1,054
Upper Oconee, Basin Water
Authority, RB, FGIC Callable
07/01/08 @ 102
5.000%, 07/01/12 500 469
Vidalia, Water & Sewer Authority,
RB, ETM Callable 07/01/00 @ 101
6.000%, 07/01/07 605 632
Walker, Dade & Catoosa Counties,
Hutchinson Medical, Ser A, RB,
FSA Callable 10/01/07 @ 102
5.500%, 10/01/08 1,370 1,374
--------
86,430
--------
Total Municipal Bonds
(Cost $89,672) 86,430
--------
--------------------------------------------------------------------------------
SHARES VALUE (000)
--------------------------------------------------------------------------------
CASH EQUIVALENTS (5.1%)
AIM Management Institutional
Tax Free Portfolio 2,010,202 $ 2,010
SEI Institutional Tax Free Fund 2,682,922 2,683
--------
Total Cash Equivalents
(Cost $4,693) 4,693
--------
Total Investments (98.6%)
(Cost $94,365) 91,123
--------
OTHER ASSETS AND LIABILITIES, NET (1.4%) 1,322
--------
NET ASSETS:
Fund shares of Trust Shares (unlimited
authorization -- no par value) based
on 8,544,266 outstanding shares of
beneficial interest 84,551
Fund shares of Investor Shares (unlimited
authorization -- no par value) based
on 258,359 outstanding shares of
beneficial interest 2,529
Fund shares of Flex Shares (unlimited
authorization -- no par value) based
on 928,499 outstanding shares of
beneficial interest 9,444
Distributions in excess of net
investment income (1)
Accumulated net realized loss on
investments (836)
Net unrealized depreciation on investments (3,242)
--------
Total Net Assets (100.0%) $92,445
========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 9.50
========
Net Asset Value and Redemption
Price Per Share -- Investor Shares $ 9.51
========
Maximum Offering Price Per Share --
Investor Shares ($9.51 / 96.25%) $ 9.88
========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.51
========
(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 56.
31
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
HIGH INCOME FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
U.S. TREASURY OBLIGATION (47.2%)
U.S. Treasury Bill
5.866%, 09/07/00 $1,475 $1,452
------
Total U.S. Treasury Obligation
(Cost $1,452) 1,452
------
CORPORATE BONDS (49.4%)
INDUSTRIAL (34.1%)
Canandaigua Brands
Callable 03/01/04 @ 104.25
8.500%, 03/01/09 100 91
Echostar DBS
Callable 02/01/04 @ 104.689
9.375%, 02/01/09 100 94
Finlay Fine Jewelry
Callable 05/01/03 @ 104.188
8.375%, 05/01/08 100 89
Hollywood Park, Ser B
Callable 08/01/02 @ 104.75
9.500%, 08/01/07 100 99
Lyondell Chemical
9.625%, 05/01/07 100 97
NBTY, Ser B
Callable 09/15/02 @ 104.313
8.625%, 09/15/07 100 87
Playtex Family Products
Callable 08/16/00 @ 103
9.000%, 12/15/03 100 96
Polaroid
11.500%, 02/15/06 100 101
Primedia Callable 04/01/03 @ 103.813
7.625%, 04/01/08 100 89
R&B Falcon
9.500%, 12/15/08 100 98
Waste Management
6.625%, 07/15/02 115 108
------
1,049
------
TELEPHONE (6.2%)
Nextel Communications
Callable 11/15/04 @ 104.688
9.375%, 11/15/09 100 94
Rural Cellular
Callable 05/15/03 @ 104.813
9.625%, 05/15/08 100 97
------
191
------
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
TRANSPORTATION (NON-RAIL--9.1%)
Continental Airlines
8.000%, 12/15/05 $100 $ 89
Greyhound Lines
Callable 04/15/02 @ 105.75
11.500%, 04/15/07 290 191
------
280
------
Total Corporate Bonds
(Cost $1,682) 1,520
------
REPURCHASE AGREEMENT (4.1%)
JP Morgan
6.250%, dated 05/31/00, matures
06/01/00, repurchase price
$124,620 (collateralized by a
U.S. Treasury Note: total market
value $127,124) (G) 125 $ 125
------
Total Repurchase Agreement
(Cost $125) 125
------
Total Investments (100.7%)
(Cost $3,259) 3,097
------
OTHER ASSETS AND LIABILITIES, NET (-0.7%) (22)
------
NET ASSETS:
Fund shares of Flex Shares (unlimited
authorization -- no par value) based
on 390,031 outstanding shares of
beneficial interest 4,006
Accumulated net realized loss on
investments (769)
Net unrealized depreciation on investments (162)
------
Total Net Assets (100.0%) $3,075
======
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 7.88
======
(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 56.
32
<PAGE>
--------------------------------------------------------------------------------
INVESTMENT GRADE BOND FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (26.3%)
U.S. Treasury Bonds
7.500%, 11/15/16 $56,050 $ 61,986
8.750%, 08/15/20 77,250 97,405
U.S. Treasury Notes
6.500%, 08/31/01 88,000 87,708
6.500%, 02/15/10 26,350 26,728
--------
Total U.S. Treasury Obligations
(Cost $269,854) 273,827
--------
U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS (10.2%)
FHLMC
7.375%, 05/15/03 51,250 51,266
5.750%, 03/15/09 16,375 14,512
FNMA
7.125%, 01/15/30 41,900 40,719
--------
Total U.S. Agency Mortgage-Backed
Obligations
(Cost $107,560) 106,497
--------
CORPORATE OBLIGATIONS (48.4%)
BANKS (4.1%)
Wachovia
5.625%, 12/15/08 13,150 11,145
Washington Mutual
8.600%, 02/01/02 18,000 18,113
7.500%, 08/15/06 13,525 12,984
--------
42,242
--------
FINANCE (19.7%)
Aristar
7.250%, 06/15/06 26,800 25,594
Associates
6.250%, 11/01/08 24,500 21,621
Countrywide Home Loan
6.850%, 06/15/04 17,750 16,796
Countrywide Home Loan,
MTN, Ser F
6.510%, 02/11/05 23,300 21,378
Donaldson Lufkin Jenrette, MTN
6.150%, 05/04/04 8,400 7,854
Finova Capital
7.250%, 11/08/04 13,400 11,189
7.250%, 07/12/06 21,500 17,227
Finova Capital, MTN, Ser E
7.300%, 09/22/03 28,850 24,919
Household Finance
7.200%, 07/15/06 21,000 19,845
Morgan Stanley Dean Witter
MTN, Ser C
7.375%, 04/15/03 20,000 19,772
Paine Webber Group, MTN, Ser C
6.020%, 04/22/02 20,250 19,465
--------
205,660
--------
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
INDUSTRIAL (11.4%)
Avon Products
7.150%, 11/15/09 $ 8,650 $ 8,055
Cooper Tire & Rubber
7.750%, 12/15/09 22,700 21,494
Dillards
6.430%, 08/01/04 24,550 21,082
Florida Power & Light
5.875%, 04/01/09 30,500 27,031
Marriot International, Ser C
7.875%, 09/15/09 24,600 23,585
Philip Morris
7.500%, 04/01/04 8,700 8,352
Times Mirror
7.450%, 10/15/09 9,500 9,144
--------
118,743
--------
LIFE/HEALTH INSURANCE (13.2%)
Aon
6.900%, 07/01/04 35,000 33,687
Conseco
8.750%, 02/09/04 41,600 28,496
6.800%, 06/15/05 22,700 14,982
6.400%, 06/15/11 8,800 6,600
Provident
7.000%, 07/15/18 30,600 23,753
Reliastar Financial
8.000%, 10/30/06 14,600 14,454
6.500%, 11/15/08 16,750 15,263
--------
137,235
--------
Total Corporate Obligations
(Cost $563,100) 503,880
--------
ASSET-BACKED OBLIGATION (3.6%)
Commercial, Series 1999-1, Cl A2
6.455%, 06/15/08 41,750 37,998
--------
Total Asset-Backed Obligation
(Cost $38,627) 37,998
--------
REPURCHASE AGREEMENTS (15.9%)
Greenwich
6.330%, dated 05/31/00, matures
06/01/00, repurchase price
$114,786,061 (collateralized by U.S.
Treasury Note: total market
value $117,062,258) (G) 114,766 114,766
33
<PAGE>
STATEMENT OF NET ASSETS/SCHEDULE OF INVESTMENTS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
INVESTMENT GRADE BONDFUND--CONCLUDED
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--CONTINUED
Warburg Dillion
6.330%, dated 05/31/00, matures
06/01/00, repurchase price
$30,811,734 (collateralized by U.S.
Treasury Notes: total market
value $31,425,526) (G) $ 30,806 $ 30,806
Salomon Smith Barney
6.330%, dated 05/31/00, matures
06/01/00, repurchase price
$20,005,261 (collateralized by U.S.
Treasury STRIPS: total market
value $20,427,914) (G) 20,002 20,002
----------
Total Repurchase Agreements
(Cost $165,574) 165,574
----------
Total Investments (104.4%)
(Cost $1,144,715) 1,087,776
----------
SECURITIES PURCHASED PAYABLE (-5.9%) (61,806)
----------
OTHER ASSETS AND LIABILITIES, NET (1.5%) 15,235
----------
NET ASSETS:
Fund shares of Trust Shares (unlimited
authorization -- no par value) based
on 104,192,073 outstanding shares of
beneficial interest 1,093,168
Fund shares of Investor Shares (unlimited
authorization -- no par value) based
on 2,353,329 outstanding shares of
beneficial interest 25,310
Fund shares of Flex Shares (unlimited
authorization -- no par value) based
on 2,091,237 outstanding shares of
beneficial interest 22,416
Distributions in excess of net
investment income (3)
Accumulated net realized loss
on investments (42,747)
Net unrealized depreciation on investments (56,939)
----------
Total Net Assets (100.0%) $1,041,205
==========
--------------------------------------------------------------------------------
VALUE (000)
--------------------------------------------------------------------------------
Net Asset Value and Redemption
Price Per Share -- Trust Shares $ 9.58
==========
Net Asset Value and Redemption
Price Per Share -- Investor Shares $ 9.58
==========
Maximum Offering Price Per Share --
Investor Shares ($9.58 / 96.25%) $ 9.95
==========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.59
==========
(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 56.
34
<PAGE>
--------------------------------------------------------------------------------
INVESTMENT GRADE TAX-EXEMPT BOND FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
MUNICIPAL BONDS (98.9%)
ALABAMA (2.1%)
Birmingham, Ser A, GO Callable
04/01/08 @ 102
5.000%, 04/01/19 $ 2,000 $ 1,753
Huntsville, Ser B, GO
4.000%, 11/01/01 1,410 1,389
-------
3,142
-------
ARIZONA (9.5%)
Arizona State, Highway
Transportation Board, RB
Callable 07/01/09 @ 100
6.125%, 07/01/14 6,020 6,240
Maricopa County, Community
College Project, Ser C, GO
5.250%, 07/01/01 5,000 5,030
Maricopa County, Unified School
District, GO, FGIC Callable
07/01/01 @ 101
6.400%, 07/01/10 3,050 3,123
-------
14,393
-------
CALIFORNIA (1.4%)
Orange County, Loma Ridge/Data
Center Project, COP, AMBAC
Callable 12/01/00 @ 101.5
6.000%, 06/01/21 2,075 2,147
-------
DISTRICT OF COLUMBIA (1.3%)
District of Columbia, American
College Obstetricians, RB,
AMBAC Prerefunded @ 102 (F)
6.500%, 08/15/01 1,930 2,005
-------
FLORIDA (7.1%)
Florida State, Department of
Transportation, Right of Way,
GO Prerefunded @101 (F)
5.800%, 07/01/05 1,400 1,454
Orange County, Health Facilities
Authority, Ser A, RB, MBIA
6.250%, 10/01/12 1,170 1,241
Tampa, Occupational License Tax,
Ser A, RB, FGIC (C)
3.850%, 10/01/18 4,500 4,500
Tampa, Sports Authority, Local
Option Sales Tax-Stadium Project,
RB, MBIA Callable 01/01/07 @ 101
5.250%, 01/01/27 4,000 3,584
-------
10,779
-------
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
GEORGIA (1.4%)
Georgia, Municipal Electric Power
Authority, Ser Y, RB, MBIA
6.500%, 01/01/17 $ 1,985 $ 2,147
-------
ILLINOIS (8.8%)
Chicago, School Finance Authority,
Ser A, GO, FGIC Callable
6/01/02 @102
6.250%, 06/01/09 6,000 6,217
Cook County, Ser A, GO, FGIC
Callable 11/15/08 @ 101
5.000%, 11/15/15 2,000 1,798
Illinois State, Health Facilities
Authority, Trinity Medical Center,
RB, FSA Prerefunded @ 102 (F)
7.000%, 07/01/02 5,000 5,280
-------
13,295
-------
IOWA (1.4%)
Des Moines, Public Parking System,
Ser A, RB, FGIC Callable
06/01/10 @ 100
6.375%, 06/01/18 2,005 2,076
-------
KENTUCKY (5.1%)
Kentucky State, Economic
Development Finance Authority,
Health Alliance Project,
Ser C, RB, MBIA (C)
3.950%, 01/01/22 7,800 7,800
-------
MARYLAND (2.4%)
Washington, Suburban Sanitation
District, 2nd Ser, GO Callable
01/01/02 @ 102
6.400%, 01/01/08 3,500 3,625
-------
MASSACHUSETTS (0.8%)
Boston, Finance Housing Authority,
City Hospital Project, Ser A, RB
Callable 08/15/00 @ 102
7.650%, 02/15/10 1,260 1,293
-------
MICHIGAN (5.7%)
Detroit, Sewer Disposal, Ser B, RB,
MBIA (C)
3.950%, 07/01/23 5,500 5,500
Michigan State, Building Authority,
Ser II, RB Callable 10/01/01 @ 102
6.750%, 10/01/11 2,950 3,067
-------
8,567
-------
35
<PAGE>
SCHEDULE OF INVESTMENTS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
INVESTMENT GRADE TAX-EXEMPT BOND FUND--CONCLUDED
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
MISSOURI (6.6%)
Missouri State, Third Street Building
Project, Ser A, GO Callable
08/01/03 @102
4.900%, 08/01/05 $ 8,500 $ 8,426
Missouri State, Health &
Educational Facilities Authority,
SSM Health Care Projects,
Ser B, RB, ETM, MBIA Callable
06/26/00 @ 102
7.000%, 06/01/05 1,500 1,533
-------
9,959
-------
NEW JERSEY (4.9%)
New Jersey State, Transportation
System, Ser A, RB
5.625%, 06/15/13 1,000 1,007
5.750%, 06/15/15 1,250 1,262
New Jersey State, Transportation
System, Ser A, RB, FSA Callable
06/15/08 @ 100
5.000%, 06/15/18 1,000 892
New Jersey State, Turnpike
Authority, Ser C, RB, FSA
6.500%, 01/01/16 1,000 1,085
New Jersey State, Turnpike
Authority, Ser C, RB, MBIA
6.500%, 01/01/16 3,000 3,255
-------
7,501
-------
NEW YORK (8.4%)
Metropolitan Transportation
Authority, Service Contract,
Ser Q, RB, MBIA Callable
07/01/07 @ 101
5.250%, 07/01/14 3,345 3,182
New York State, Dormitory
Authority, City University
System, Ser A, RB, FSA
5.750%, 07/01/13 1,250 1,275
New York State, Dormitory
Authority, City University
System, 3rd Ser, RB, FGIC
Callable 07/01/08 @101
5.000%, 07/01/18 1,750 1,557
New York State, Dormitory
Authority, City University
System, 2nd Ser, RB, FSA
5.750%, 07/01/18 3,175 3,178
Triborough Bridge & Tunnel
Authority, Ser V, RB, FGIC
Callable 01/01/01 @ 102
6.875%, 01/01/05 3,500 3,609
-------
12,801
-------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
NORTH CAROLINA (0.7%)
North Carolina State, Medical
Care Community Hospital, Mercy
Hospital Project, RB, ETM
Callable 08/01/02 @ 102
6.500%, 08/01/15 $ 1,000 $ 1,047
-------
OHIO (1.1%)
Cleveland, City School District,
Ser A, GO, FGIC Callable
12/01/02 @ 102
5.875%, 12/01/11 1,650 1,678
-------
SOUTH DAKOTA (4.6%)
South Dakota State, Health &
Educational Facility Authority,
St. Lukes Midland Regional
Medical, RB, MBIA Callable
07/01/01 @ 102
6.625%, 07/01/11 6,675 6,906
-------
TENNESSEE (2.7%)
Metropolitan Nashville, Airport
Authority, Ser C, RB, FGIC
Callable 07/01/01 @ 102
6.600%, 07/01/15 3,900 4,039
-------
TEXAS (19.4%)
Dallas, GO Callable 02/15/08 @ 100
5.000%, 02/15/13 4,500 4,175
Ennis, Independent School District,
GO Callable 08/15/10 @ 40.4318 (A)
0.000%, 08/15/24 3,265 682
Harris County, Toll Road, Sub Lien,
RB, FGIC
6.000%, 08/01/14 10,000 10,193
Houston, Independent School
District, Ser A, GO Callable
02/15/09 @ 100
5.000%, 02/15/24 4,000 3,403
Irving, Independent School District,
GO Callable 02/15/07 @ 100
5.000%, 02/15/21 2,500 2,171
McAllen, Independent School
District, GO Callable
10/01/09 @100
5.250%, 04/01/16 1,600 1,502
5.250%, 04/01/17 1,695 1,577
5.250%, 04/01/18 1,795 1,654
University of Texas, Ser B, RB
Callable 08/15/01 @ 102
6.750%, 08/15/13 1,475 1,533
36
<PAGE>
--------------------------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
--------------------------------------------------------------------------------
TEXAS--CONTINUED
Waxahachie, Independent School
District, GO Callable 08/15/10
@ 39.372 (A)
0.000%, 08/15/24 $ 6,385 $ 1,288
Waxahachie, Independent School
District, GO Callable
08/15/10 @ 45.084 (A)
0.000%, 08/15/22 5,000 1,157
--------
29,335
--------
VERMONT (1.4%)
Burlington, Electric Authority,
Ser A, RB, MBIA Callable
07/01/02 @102
6.250%, 07/01/14 2,000 2,061
--------
VIRGINIA (0.2%)
Virginia State, Public Building
Authority, RB Callable
08/01/10 @100
5.750%, 08/01/20 250 245
--------
WASHINGTON (1.9%)
Clark County, Public Utility District,
RB, AMBAC Callable
01/01/03 @ 102
5.100%, 01/01/08 3,000 2,929
--------
Total Municipal Bonds
(Cost $150,636) 149,770
--------
CASH EQUIVALENTS (9.8%)
AIM Management Institutional
Tax Free Portfolio 7,381,127 7,381
SEI Institutional Tax Free Fund 7,461,934 7,462
--------
Total Cash Equivalents
(Cost $14,843) 14,843
--------
Total Investments (108.7%)
(Cost $165,479) 164,613
--------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56.
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
LIMITED-TERM FEDERAL MORTGAGE SECURITIES FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
U.S. TREASURY OBLIGATION (15.5%)
U.S. Treasury Note
6.500%, 08/31/01 $20,000 $ 19,934
--------
Total U.S. Treasury Obligation
(Cost $19,920) 19,934
--------
U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS (67.5%)
FHLMC
8.000%, 12/01/02 664 664
FHLMC REMIC, Ser 1614, Cl H
6.000%, 06/15/20 4,550 4,495
FHLMC REMIC, Ser 1624, Cl KC
6.000%, 06/15/08 11,084 10,576
FHLMC REMIC, Ser 1666, Cl E
6.000%, 12/15/19 5,000 4,909
FHLMC REMIC, Ser 29, Cl Q
7.500%, 06/25/20 15,000 14,952
FNMA
6.500%, 06/01/13 8,334 7,912
6.000%, 09/01/13 9,691 9,024
5.500%, 06/01/14 18,783 17,081
8.500%, 04/01/17 414 418
FNMA REMIC, Ser 206, Cl G
6.000%, 04/25/19 11,000 10,793
FNMA REMIC, Ser 223, Cl PH
6.050%, 10/25/22 5,375 5,125
GNMA
9.000%, 11/15/17 566 589
--------
Total U.S. Agency Mortgage-Backed
Obligations
(Cost $89,158) 86,538
--------
REPURCHASE AGREEMENT (17.0%)
Morgan Stanley Dean Witter
6.450%, dated 05/31/00, matures
06/01/00, repurchase price
$21,795 (collateralized by
FNMA obligation: total market
value $22,675) (G) 21,791 21,791
--------
Total Repurchase Agreement
(Cost $21,791) 21,791
--------
Total Investments (100.0%)
(Cost $130,869) 128,263
--------
OTHER ASSETS AND LIABILITIES, NET (0.0%) (8)
--------
--------------------------------------------------------------------------------
VALUE (000)
--------------------------------------------------------------------------------
NET ASSETS:
Fund shares of Trust Shares (unlimited
authorization -- no par value) based
on 13,035,532 outstanding shares of
beneficial interest $131,248
Fund shares of Investor Shares (unlimited
authorization -- no par value) based
on 124,256 outstanding shares of
beneficial interest 1,281
Fund shares of Flex Shares (unlimited
authorization -- no par value) based
on 177,386 outstanding shares of
beneficial interest 1,817
Distributions in excess of net investment
income (7)
Accumulated net realized loss on
investments (3,478)
Net unrealized depreciation on investments (2,606)
--------
Total Net Assets (100.0%) $128,255
========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 9.62
========
Net Asset Value and Redemption
Price Per Share -- Investor Shares $ 9.60
========
Maximum Offering Price Per Share --
Investor Shares ($9.60 / 97.50%) $ 9.85
========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.62
========
(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 56.
38
<PAGE>
--------------------------------------------------------------------------------
MARYLAND MUNICIPAL BOND FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
MUNICIPAL BONDS (94.9%)
MARYLAND (81.2%)
Anne Arundel County, GO
Callable 02/01/08 @ 101
5.125%, 02/01/24 $ 750 $ 666
Baltimore County, Consolidated
Public Improvement, GO
Callable 06/01/06 @ 101
5.500%, 06/01/16 250 246
Baltimore County, Consolidated
Public Improvement, GO
Callable 07/01/08 @101
4.750%, 07/01/09 500 475
Baltimore, Emergency
Telecommunication Facilities,
Ser A, COP, AMBAC Callable
10/01/07 @ 102
5.000%, 10/01/17 400 364
Baltimore, Pollution Control
Authority, General Motors
Project, RB
5.350%, 04/01/08 250 251
Calvert County, Economic
Development Authority,
Asbury-Solomons Project, RB,
MBIA Callable 01/01/08 @ 102
5.000%, 01/01/17 250 226
Calvert County, Pollution Control
Authority, Baltimore Gas &
Electric Project, RB Callable
07/15/04 @ 102
5.550%, 07/15/14 250 246
Carroll County, Consolidated
Public Improvement, GO
Callable 12/01/06 @ 101
5.125%, 12/01/14 500 475
Maryland State, Aviation
Administration Facilities, COP,
AMT Callable 05/01/09 @101
4.750%, 05/01/13 1,500 1,341
Maryland State, GO (C)
4.380%, 08/01/12 700 700
Maryland State, Community
Development Administration,
Ser B, RB, AMT, FHA Callable
03/01/07 @ 101.50
5.875%, 09/01/25 500 475
Maryland State, Community
Development Administration,
Ser D, RB, AMT Callable
03/01/09 @ 101
5.250%, 09/01/19 1,000 893
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
MARYLAND--CONTINUED
Maryland State, Community
Development Administration,
Ser E, RB, FHA Callable
09/01/09 @ 100
5.700%, 09/01/17 $1,000 $ 960
Maryland State, Community
Development Administration,
Ser F, RB, AMT Callable
09/01/09 @ 100
5.900%, 09/01/19 1,000 951
Maryland State, Community
Development Administration,
Single-Family Housing, 1st Ser,
RB Callable 04/01/07 @ 101.50
5.600%, 04/01/18 375 355
Maryland State, Community
Development Administration,
Single-Family Program, 2nd Ser,
RB Callable 04/01/09 @ 101
5.000%, 04/01/17 1,000 884
Maryland State, Economic
Development Authority,
Chesapeake Bay Foundation,
RB (C) (E)
4.350%, 11/01/23 500 500
Maryland State, Health & Higher
Educational Facilities Authority,
Anne Arundel Medical Center
Project, RB, FSA Callable
7/01/08 @ 101
5.125%, 07/01/28 1,250 1,089
Maryland State, Health & Higher
Educational Facilities Authority,
Broadmead Project, RB Callable
07/01/07 @ 102
5.500%, 07/01/17 300 265
Maryland State, Health & Higher
Educational Facilities Authority,
Calvert Memorial Hospital Project,
RB Callable 07/01/08 @ 102
5.000%, 07/01/13 400 349
Maryland State, Health & Higher
Educational Facilities Authority,
Catholic Health Initiatives, Ser A,
RB Callable 06/01/10 @ 101
6.000%, 12/01/24 250 243
Maryland State, Health & Higher
Educational Facilities Authority,
Greater Baltimore Medical
Center, RB
4.350%, 07/01/25 1,000 1,000
39
<PAGE>
--------------------------------------------------------------------------------
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
MARYLAND MUNICIPAL BOND FUND--CONCLUDED
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
MARYLAND--CONTINUED
Maryland State, Health & Higher
Educational Facilities Authority,
Johns Hopkins Health System
Project, RB, AMBAC Callable
07/01/07 @ 102
5.250%, 07/01/17 $ 350 $ 326
Maryland State, Health & Higher
Educational Facilities Authority,
Loyola College Project, RB
Callable 10/01/09 @ 101
5.250%, 10/01/29 1,250 1,101
Maryland State, Health & Higher
Educational Facilities Authority,
Loyola College Project, Ser A,
RB, MBIA Callable 10/01/06 @ 102
5.500%, 10/01/16 250 242
Maryland State, Health & Higher
Educational Facilities Authority,
Pickersgill Project, Ser A, RB
Callable 01/01/07 @ 102
6.000%, 01/01/15 350 333
Maryland State, Health & Higher
Educational Facilities Authority,
University of Maryland Medical
Systems Project, Ser A, RB, FGIC
Prerefunded @ 100 (F)
6.500%, 07/01/01 200 204
Maryland State, Health & Higher
Educational Facilities Authority,
Upper Chesapeake Hospital
Project, Ser A, RB, FSA Callable
01/01/08 @ 101
5.125%, 01/01/33 1,250 1,078
Maryland State, Industrial
Development Financing Authority,
Holy Cross Health System, RB
Callable 12/01/03 @ 102
5.500%, 12/01/15 100 96
Maryland State, State & Local
Facilities Loan, First Ser, GO
Callable 02/15/06 @ 101.50
4.700%, 02/15/10 300 281
Maryland State, State & Local
Facilities Loan, Third Ser, GO
5.500%, 10/15/04 500 510
Maryland State, Stadium Authority,
Sports Facility Project, RB, AMBAC
Callable 03/01/06 @ 101
5.800%, 03/01/26 250 243
Maryland State, Transportation
Authority, RB, ETM
6.800%, 07/01/16 120 132
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
MARYLAND--CONTINUED
Montgomery County, Economic
Development Authority, Genomic
Research Facility, RB (C) (E)
Callable 06/02/00 @ 100
4.400%, 03/01/09 $ 700 $ 700
Montgomery County, Housing
Opportunity, Kensington Park
Project, RB, MBIA
3.950%, 07/01/28 1,600 1,600
Montgomery County, Housing
Opportunity, The Grande Project
Issue I, RB, AMT (C)
3.950%, 06/01/30 1,300 1,300
Montgomery County, Human
Services Headquarters Project, RB
5.400%, 08/01/06 200 203
Montgomery County, Pollution
Control Authority, Potomac
Electric Power Project, RB, MBIA
Callable 02/15/04 @ 102
5.375%, 02/15/24 1,700 1,556
Montgomery County, Pollution
Control Authority, Potomac
Electric Power Project, RB
Callable 02/15/04 @ 102
5.375%, 02/15/24 100 90
Montgomery County, Consolidated
Public Improvement, Ser A, GO
5.800%, 07/01/07 500 519
Northeast Maryland, Waste Disposal
Authority, Montgomery County
Resource Project, RB Callable
07/01/03 @ 102
6.200%, 07/01/10 275 278
Prince Georges County, Consolidated
Public Improvements, Ser A, GO,
MBIA Callable 03/01/02 @ 102
5.625%, 09/01/04 250 255
Queen Annes County, Public
Facilities, GO, FGIC
5.125%, 11/15/06 350 350
Saint Mary's County, Public
Facilities, GO, AMBAC Callable
11/01/03 @ 102
5.500%, 11/01/07 150 152
Saint Mary's County, Consolidated
Public Improvements, GO, MBIA
4.500%, 09/01/00 500 500
University of Maryland, Ser A, RB
Callable 04/01/08 @ 100
5.000%, 04/01/19 500 446
40
<PAGE>
--------------------------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
--------------------------------------------------------------------------------
MARYLAND--CONTINUED
University of Maryland, Ser A, RB
5.000%, 04/01/05 $ 400 $ 398
University of Maryland, Ser A, RB
Callable 04/01/06 @ 101
5.500%, 04/01/08 100 101
Washington County, Consolidated
Public Improvement, GO, FGIC
Callable 01/01/03 @ 102
5.250%, 01/01/07 100 100
Washington County, Suburban
Sanitation District, GO Callable
06/01/06 @ 100
5.600%, 06/01/19 250 243
-------
26,291
-------
Puerto Rico (13.7%)
Puerto Rico Commonwealth,
Highway & Transportation
Authority, Ser Y, RB Callable
07/01/06 @ 101.50
5.500%, 07/01/26 1,700 1,576
Puerto Rico Commonwealth,
Housing, Bank & Finance Agency,
Affordable Housing Mortgage
Porfolio, Ser I, RB, AMT, GNMA
Callable 04/01/05 @ 102
6.250%, 04/01/29 660 650
Puerto Rico Commonwealth, Medical
& Environmental Control Facilities,
San Lucas & Cristo Project, Ser A,
RB Callable 06/01/09 @ 101
5.750%, 06/01/29 740 604
Puerto Rico Commonwealth, Public
Finance, Ser PA 502, RB (C)
3.900%, 06/01/19 1,600 1,600
-------
4,430
-------
Total Municipal Bonds
(Cost $32,457) 30,721
-------
Cash Equivalents (5.0%)
AIM Tax Free Institutional Cash
Reserve 808,589 809
Federated Maryland
Municipal Cash Trust 808,236 808
-------
Total Cash Equivalents
(Cost $1,617) 1,617
-------
Total Investments (99.9%)
(Cost $34,074) 32,338
-------
Other Assets and Liabilities, Net (0.1%) 50
-------
--------------------------------------------------------------------------------
VALUE (000)
--------------------------------------------------------------------------------
NET ASSETS:
Fund shares of Trust Shares (unlimited
authorization -- no par value) based
on 2,767,603 outstanding shares of
beneficial interest $27,677
Fund shares of Flex Shares (unlimited
authorization -- no par value) based
on 655,599 outstanding shares of
beneficial interest 6,738
Distributions in excess of net investment
income (35)
Accumulated net realized loss
on investments (256)
Net unrealized depreciation on investments (1,736)
-------
Total Net Assets (100.0%) $32,388
=======
Net Asset Value and Redemption
Price Per Share-- Trust Shares $ 9.46
=======
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.48
=======
(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 56.
41
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
SHORT-TERM BOND FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (18.9%)
U.S. Treasury Notes
5.000%, 04/30/01 $11,000 $ 10,833
5.250%, 05/31/01 1,500 1,478
6.500%, 08/31/01 7,000 6,977
5.625%, 09/30/01 1,000 985
6.375%, 09/30/01 6,000 5,969
6.250%, 10/31/01 1,750 1,738
7.500%, 11/15/01 2,500 2,524
6.250%, 06/30/02 1,250 1,237
6.000%, 07/31/02 2,000 1,970
U.S. Treasury STRIPS
0.000%, 08/15/03 1,250 1,013
--------
Total U.S. Treasury Obligations
(Cost $35,373) 34,724
--------
U.S. GOVERNMENT AGENCY OBLIGATION (0.5%)
FFCB
7.125%, 06/01/01 1,000 999
--------
Total U.S. Government Agency
Obligation
(Cost $1,001) 999
--------
U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS (7.4%)
FHLMC
6.500%, 12/01/00 660 655
6.000%, 07/01/06 8,422 7,900
FNMA
7.000%, 01/01/27 1,531 1,453
FNMA REMIC, Ser 1996-30, Cl PC
7.000%, 11/25/20 2,600 2,559
GNMA
8.000%, 11/15/09 1,071 1,081
--------
Total U.S. Agency Mortgage-Backed
Obligations
(Cost $14,155) 13,648
--------
CORPORATE OBLIGATIONS (63.4%)
BANKS (2.4%)
Banc One
6.400%, 08/01/02 3,000 2,921
Key Bank
5.800%, 04/01/04 1,675 1,562
--------
4,483
--------
FINANCE (26.0%)
American General
6.250%, 03/15/03 1,100 1,057
American General Finance
5.900%, 01/15/03 2,000 1,908
Associates, Ser H, MTN
7.080%, 04/15/03 1,500 1,470
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
FINANCE--CONTINUED
CIT Group Holdings, MTN
6.500%, 06/14/02 $ 3,000 $ 2,918
Commercial Credit
6.375%, 09/15/02 2,500 2,434
Diageo Capital PLC
6.625%, 06/24/04 2,500 2,406
Daimler Chrysler NA Holdings,
Ser B, MTN
6.460%, 12/01/01 2,500 2,454
Ford Capital
10.125%, 11/15/00 2,000 2,024
Ford Motor Credit
6.000%, 01/14/03 3,500 3,356
General Electric Capital, Ser A, MTN
6.330%, 09/17/01 3,000 2,963
General Motors Acceptance
5.950%, 03/14/03 1,000 955
Household Finance
8.000%, 05/09/05 2,500 2,475
Household Finance, MTN
7.080%, 06/03/02 2,500 2,459
International Lease Finance,
Ser J, MTN
5.500%, 09/29/03 2,000 1,873
Merrill Lynch, Ser B, MTN
5.640%, 01/27/03 3,750 3,563
Morgan Stanley Dean Witter,
Ser C, MTN
5.625%, 04/12/02 1,750 1,689
PNC Funding
6.950%, 09/01/02 3,000 2,955
Salomon Smith Barney Holdings
6.750%, 02/15/03 3,000 2,921
Transamerica Finance, Ser F, MTN
6.800%, 12/14/01 3,000 2,954
US West Capital Funding
6.875%, 08/15/01 3,000 2,973
--------
47,807
--------
INDUSTRIAL (21.7%)
American Home Products
7.900%, 02/15/05 2,000 2,015
Clark Equipment
9.750%, 03/01/01 1,750 1,774
Computer Associates
International, Ser B
6.375%, 04/15/05 2,300 2,105
Conoco
5.900%, 04/15/04 1,150 1,084
Cox Communications
7.000%, 08/15/01 3,000 2,966
Daimler Chrysler NA Holdings
7.400%, 01/20/05 2,000 1,965
42
<PAGE>
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
Industrial--continued
Dayton Hudson (C)
5.950%, 06/15/00 $ 500 $ 499
Eastman Kodak, Ser A, MTN
6.500%, 08/15/01 4,000 3,945
General Foods
Callable 08/16/00 @ 100
6.000%, 06/15/01 500 488
Hasbro
7.950%, 03/15/03 3,000 2,982
Nabisco
6.800%, 09/01/01 1,500 1,457
Norfolk Southern
7.875%, 02/15/04 1,500 1,494
Philip Morris
7.500%, 01/15/02 500 493
Procter & Gamble
5.250%, 09/15/03 3,000 2,828
Raytheon
6.450%, 08/15/02 2,900 2,828
Safeway Stores
7.000%, 09/15/02 3,000 2,944
TCI Communications
6.375%, 05/01/03 2,250 2,168
TRW
6.500%, 06/01/02 3,000 2,910
TRW, Ser A, MTN
9.000%, 02/09/01 1,000 1,005
Tyco International Group SA(C)
6.250%, 06/15/03 2,000 1,885
--------
39,835
--------
UTILITIES (13.3%)
Alabama Power
7.850%, 05/15/03 3,250 3,245
Baltimore Gas and Electric
6.125%, 07/01/03 1,750 1,682
Northern States Power
6.125%, 12/01/05 5,000 4,644
Pacific Gas and Electric, Ser 93-E
5.875%, 10/01/05 3,500 3,203
Philadelphia Electric
7.125%, 09/01/02 2,000 1,975
Scottish Power PLC, Ser H, MTN
6.750%, 07/15/04 2,500 2,393
Southern New England Telephone,
Ser C, MTN
6.125%, 12/15/03 3,000 2,861
Sprint Capital
5.700%, 11/15/03 2,000 1,875
Vodaphone Airtouch PLC (B)
6.698%, 12/19/01 2,500 2,497
--------
24,375
--------
Total Corporate Obligations
(Cost $119,792) 116,500
--------
--------------------------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
--------------------------------------------------------------------------------
REGIONAL GOVERNMENT AGENCY (1.4%)
Province of Quebec
8.800%, 04/15/03 $ 2,500 $ 2,584
--------
Total Regional Government Agency
(Cost $2,655) 2,584
--------
ASSET-BACKED OBLIGATIONS (6.6%)
CoreStates Home Equity Trust,
Ser 1994-1, Cl A
6.650%, 05/15/09 455 449
Discover Card Master Trust I,
Ser 1998-4, Cl A
5.750%, 10/16/03 1,990 1,960
Discover Card Master Trust I,
Ser 1999-2, Cl A
5.900%, 10/15/04 3,000 2,918
EQCC Home Equity Loan Trust,
Ser 1994-1, Cl A
5.800%, 03/15/09 386 373
Equivantage Home Equity Loan
Trust, Ser 1996-1, Cl A
6.550%, 10/25/25 452 440
Metris Master Trust,
Ser 1997-1, Cl A
6.870%, 10/20/05 2,000 1,980
Premier Auto Trust,
Ser 1998-5, Cl A-4
5.190%, 04/08/03 3,500 3,373
Spiegel Master Trust,
Ser 1995-A, Cl A
7.500%, 09/15/04 333 334
Union Acceptance,
Ser 2000-A, Cl A1
5.993%, 02/08/01 337 337
--------
Total Asset-Backed Obligations
(Cost $12,412) 12,164
--------
CASH EQUIVALENTS (0.6%)
AIM Liquid Assets Portfolio 968,315 968
SEI Daily Income Trust Prime
Obligation Fund 54,190 54
--------
Total Cash Equivalents
(Cost $1,022) 1,022
--------
Total Investments (98.8%)
(Cost $186,410) 181,641
--------
OTHER ASSETS AND LIABILITIES, NET (1.2%) 2,272
--------
43
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
SHORT-TERM BOND FUND--CONCLUDED
--------------------------------------------------------------------------------
VALUE (000)
--------------------------------------------------------------------------------
NET ASSETS:
Fund shares of Trust Shares (unlimited
authorization -- no par value) based
on 18,701,923 outstanding shares of
beneficial interest $189,921
Fund shares of Investor Shares (unlimited
authorization -- no par value) based
on 149,580 outstanding shares of
beneficial interest 1,506
Fund shares of Flex Shares (unlimited
authorization -- no par value) based
on 213,649 outstanding shares of
beneficial interest 2,159
Distributions in excess of net investment
income (4)
Accumulated net realized loss
on investments (4,900)
Net unrealized depreciation on investments (4,769)
--------
Total Net Assets (100.0%) $183,913
========
Net Asset Value and Redemption
Price Per Share -- Trust Shares $ 9.65
========
Net Asset Value and Redemption
Price Per Share -- Investor Shares $ 9.67
========
Maximum Offering Price Per Share --
Investor Shares ($9.67 / 98.00%) $ 9.87
========
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.67
========
(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 56.
44
<PAGE>
SHORT-TERM U.S. TREASURY SECURITIES FUND
--------------------------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
--------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (97.0%)
U. S. Treasury Bills
6.081%, 08/17/00 $ 5,000 $ 4,942
5.605%, 10/12/00 6,000 5,872
U.S. Treasury Notes
5.750%, 10/31/00 2,000 1,995
5.375%, 02/15/01 12,800 12,681
4.875%, 03/31/01 4,000 3,940
6.375%, 03/31/01 11,500 11,464
6.250%, 10/31/01 3,000 2,979
7.500%, 11/15/01 7,500 7,573
6.250%, 01/31/02 4,500 4,463
6.625%, 03/31/02 10,500 10,471
6.250%, 06/30/02 2,000 1,980
5.875%, 09/30/02 4,500 4,417
5.500%, 03/31/03 5,000 4,845
-------
Total U.S. Treasury Obligations
(Cost $78,450) 77,622
-------
CASH EQUIVALENT (2.4%)
SEI Daily Income Trust Treasury
II Fund 1,903,850 1,904
-------
Total Cash Equivalent
(Cost $1,904) 1,904
-------
Total Investments (99.4%)
(Cost $80,354) 79,526
-------
Other Assets and Liabilities, Net (0.6%) 501
-------
Net Assets:
Fund shares of Trust Shares (unlimited
authorization -- no par value) based
on 7,368,421 outstanding shares of
beneficial interest 73,271
Fund shares of Investor Shares (unlimited
authorization -- no par value) based
on 209,753 outstanding shares of
beneficial interest 2,137
Fund shares of Flex Shares (unlimited
authorization -- no par value) based
on 548,512 outstanding shares of
beneficial interest 5,484
Distributions in excess of net
investment income (21)
Accumulated net realized loss
on investments (16)
Net unrealized depreciation on investments (828)
-------
Total Net Assets (100.0%) $80,027
=======
--------------------------------------------------------------------------------
VALUE
--------------------------------------------------------------------------------
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 9.85
=======
Net Asset Value and Redemption
Price Per Share-- Investor Shares $ 9.85
=======
Maximum Offering Price Per Share --
Investor Shares ($9.85 / 99.00%) $ 9.95
=======
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.83
=======
(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 56.
45
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
U.S. GOVERNMENT SECURITIES FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS (12.8%)
U.S. Treasury Bonds
7.250%, 05/15/16 $ 1,000 $ 1,080
7.625%, 02/15/25 400 463
6.125%, 11/15/27 2,220 2,171
5.250%, 11/15/28 2,350 2,038
U.S. Treasury Notes
6.250%, 04/30/01 510 508
8.000%, 05/15/01 90 91
6.625%, 06/30/01 580 579
7.500%, 05/15/02 750 760
6.250%, 06/30/02 550 544
7.250%, 05/15/04 500 510
7.875%, 11/15/04 275 288
7.500%, 02/15/05 500 517
6.500%, 10/15/06 2,000 1,991
6.625%, 05/15/07 550 552
-------
Total U.S. Treasury Obligations
(Cost $12,531) 12,092
-------
U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS (86.2%)
FHLMC
6.000%, 02/01/01 42 40
7.000%, 01/01/09 65 63
7.000%, 04/01/09 198 191
7.000%, 08/01/10 390 377
7.000%, 01/01/11 227 220
7.000%, 02/01/12 799 774
6.500%, 03/01/12 2,391 2,273
7.000%, 05/01/12 472 457
6.500%, 12/01/12 1,152 1,095
7.000%, 06/01/17 4,699 4,465
FHLMC REMIC, Ser 2039, Cl PC
6.000%, 05/15/09 1,000 945
FNMA
6.000%, 11/01/07 600 565
7.500%, 06/01/11 288 283
7.000%, 09/01/11 509 493
7.000%, 05/01/12 518 501
7.000%, 06/01/12 408 395
7.000%, 07/01/12 484 468
6.500%, 06/01/13 1,414 1,344
6.500%, 09/01/13 165 157
7.000%, 11/01/14 4,890 4,732
7.000%, 10/25/16 482 457
6.500%, 07/01/18 875 814
6.290%, 08/01/18 1,441 1,340
6.500%, 08/01/18 855 791
6.000%, 12/01/18 1,844 1,655
7.000%, 01/01/27 766 726
7.500%, 04/01/27 418 406
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
FNMA--CONTINUED
6.000%, 03/01/28 $ 822 $ 737
6.500%, 03/02/28 780 721
6.500%, 03/01/29 3,738 3,458
6.250%, 05/15/29 10,000 8,687
FNMA REMIC, Ser 143, Cl J
8.750%, 12/25/20 45 46
FNMA REMIC, Ser 156, Cl B
6.500%, 04/25/18 100 98
FNMA REMIC, Ser 30, Cl PC
7.000%, 11/25/20 2,000 1,969
FNMA REMIC, Ser 34, Cl VC
7.500%, 05/01/12 1,000 979
FNMA REMIC, Ser 40, Cl VC
6.500%, 08/25/10 261 241
FNMA REMIC, Ser 6, Cl H
7.000%, 08/18/08 1,058 1,010
FNMA REMIC, Ser 63, Cl PC
6.500%, 03/18/26 1,140 1,082
FNMA REMIC, Ser 68, Cl C
6.500%, 08/18/18 1,000 969
FNMA REMIC, Ser 9, Cl H
6.500%, 11/25/13 1,337 1,232
GNMA
7.500%, 10/20/09 32 32
8.000%, 11/15/09 693 699
8.250%, 01/15/12 55 55
6.000%, 07/15/13 875 817
6.000%, 01/15/14 1,708 1,595
9.000%, 04/15/17 163 168
8.500%, 05/15/17 561 571
10.000%, 06/15/19 2 2
7.500%, 05/15/22 194 190
7.000%, 11/15/22 310 297
8.000%, 02/15/23 14 14
8.500%, 03/15/23 30 31
7.500%, 04/15/23 84 83
7.500%, 09/15/23 605 594
6.500%, 10/15/23 739 691
6.500%, 11/15/23 994 930
7.000%, 01/15/24 92 89
7.500%, 04/15/24 492 483
7.000%, 06/15/24 571 548
8.000%, 08/15/24 36 36
8.000%, 09/15/24 11 11
8.000%, 10/15/24 18 18
8.000%, 11/15/24 14 14
8.500%, 12/15/24 32 33
8.500%, 02/15/25 5 5
7.000%, 12/15/25 308 296
7.500%, 01/15/26 332 326
46
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
--------------------------------------------------------------------------------
GNMA--CONTINUED
7.500%, 09/15/26 $ 496 $ 487
7.000%, 03/15/27 211 203
7.000%, 04/15/27 703 674
7.500%, 07/15/27 296 291
7.000%, 09/15/27 62 60
7.000%, 10/15/27 694 667
7.500%, 10/15/27 36 35
7.000%, 11/15/27 964 925
7.000%, 12/15/27 833 799
7.000%, 01/15/28 1,121 1,075
7.500%, 01/15/28 282 277
6.500%, 02/15/28 868 812
6.500%, 03/15/28 107 100
6.500%, 04/15/28 78 73
6.500%, 05/20/28 1,747 1,626
6.500%, 06/15/28 38 35
6.500%, 09/15/28 2,794 2,614
6.250%, 10/15/28 1,866 1,720
6.500%, 02/15/29 658 616
7.500%, 10/15/29 10,801 10,606
GNMA REMIC, Ser 6, Cl E
7.500%, 05/20/23 1,000 985
GNMA REMIC, Ser 9, Cl D
6.500%, 08/20/24 1,000 897
-------
Total U.S. Agency Mortgage-Backed
Obligations
(Cost $84,961) 81,461
-------
ASSET-BACKED OBLIGATION (0.0%)
EQCC Home Equity Loan Trust,
Ser 1, Cl A
5.800%, 03/15/09 40 38
-------
Total Asset-Backed Obligation
(Cost $40) 38
-------
CASH EQUIVALENT (1.0%)
AIM Liquid Assets Portfolio 970,967 971
-------
Total Cash Equivalent
(Cost $971) 971
-------
Total Investments (100.0%)
(Cost $98,503) 94,562
-------
OTHER ASSETS AND LIABILITIES, NET (0.0%) 15
-------
--------------------------------------------------------------------------------
VALUE (000)
--------------------------------------------------------------------------------
NET ASSETS:
Fund shares of Trust Shares (unlimited
authorization -- no par value) based
on 8,659,920 outstanding shares of
beneficial interest $91,170
Fund shares of Investor Shares (unlimited
authorization -- no par value) based
on 142,703 outstanding shares of
beneficial interest 1,456
Fund shares of Flex Shares (unlimited
authorization -- no par value) based
on 785,689 outstanding shares of
beneficial interest 8,432
Undistributed net investment income 4
Accumulated net realized loss
on investments (2,544)
Net unrealized depreciation on investments (3,941)
-------
Total Net Assets (100.0%) $94,577
=======
Net Asset Value and Redemption
Price Per Share -- Trust Shares $ 9.86
=======
Net Asset Value and Redemption
Price Per Share -- Investor Shares $ 9.86
=======
Maximum Offering Price Per Share --
Investor Shares ($9.86 / 96.25%) $ 10.24
=======
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.86
=======
(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 56.
47
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
MUNICIPAL BONDS (96.2%)
VIRGINIA (96.2%)
Alexandria, Consolidated Public
Improvement, GO
4.500%, 01/01/15 $ 2,000 $ 1,729
Alexandria, Redevelopment &
Housing Authority, Residential
Care Facilities, Goodwin House
Project, Ser B, RB Callable
06/02/00 @ 100
4.450%, 10/01/06 2,650 2,650
Arlington County, GO
5.400%, 08/01/01 1,000 1,008
Arlington County, Industrial
Development Authority,
Alexandria/Arlington Project,
Ser A, RB, FSA
5.250%, 01/01/05 4,000 4,011
Arlington County, Industrial
Development Authority,
Alexandria/Arlington Waste
Project, Ser B, RB, AMT, FSA
Callable 07/01/08 @ 101
5.375%, 01/01/11 3,000 2,909
Arlington County, GO Callable
10/01/08 @ 101
5.000%, 10/01/11 3,220 3,104
Chesapeake Bay, Bridge & Tunnel
Authority, General Resolution,
RB, MBIA Prerefunded @ 102 (F)
6.375%, 07/01/01 7,000 7,257
Chesapeake, GO
5.400%, 12/01/08 2,500 2,522
Chesapeake, Hospital Authority,
General Hospital Project, RB,
Callable 07/01/00 @ 102
8.200%, 07/01/05 1,000 1,022
Chesterfield County, Public
Improvements, Ser A, GO
Callable 01/01/08 @ 100
4.700%, 01/01/12 3,215 2,946
Danville, Industrial Development
Authority, Danville Regional
Medical Center Project,
RB, AMBAC
5.250%, 10/01/28 4,250 3,788
Dinwiddie County, Industrial
Development Authority,
Ser A, RB Callable
07/03/00 @ 100
4.750%, 07/15/01 3,150 3,127
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Fairfax County, Industrial
Development Authority, Health
Care Inova Health System Project,
RB Callable 08/15/06 @ 102
5.300%, 08/15/07 $ 1,500 $ 1,475
Fairfax County, Industrial
Development Authority, Health
Care Inova Health System
Project, Ser A, RB Callable
02/15/08 @ 101
5.000%, 08/15/10 2,890 2,672
Fairfax County, Public
Improvement, Ser A, GO
Callable 06/01/07 @ 102
4.500%, 06/01/10 3,000 2,731
Fairfax County, Ser B, GO
Prerefunded @ 102 (F)
5.200%, 06/01/01 5,000 5,121
Fairfax County, Sewer Authority,
RB, AMBAC Callable
11/15/03 @ 102
5.500%, 11/15/09 3,000 3,020
Fairfax County, Water Authority,
RB Callable 04/01/07 @ 102
6.000%, 04/01/22 5,000 5,016
Fredericksburg, Industrial
Development Authority,
Medicorp Health System, RB,
AMBAC Callable 06/15/07 @ 102
5.250%, 06/15/16 5,000 4,583
Hanover County, Industrial
Development Authority, Covenant
Woods Project, RB Callable
07/03/00 @ 100 (C) (D) (E)
4.450%, 07/01/29 3,000 3,000
Harrisonburg, Industrial
Development Authority,
Rockingham Memorial Hospital
Project, RB, MBIA Callable
12/01/02 @ 102
5.750%, 12/01/13 3,000 2,994
Henrico County, Industrial
Development Authority,
Educational Facilities, Collegiate
Schools, RB Callable
10/15/08 @ 102
5.000%, 10/15/19 2,250 1,950
Henrico County, Industrial
Development Authority, Bon
Secours Health System Project,
RB, FSA
4.950%, 08/15/03 1,000 992
48
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Henrico County, Industrial
Development Authority,
Governmental Projects, RB
Callable 06/01/06 @ 102
5.150%, 06/01/07 $ 2,500 $ 2,485
Henrico County, Industrial
Development Authority, Solid
Waste Facility, Browning Ferris
Project, RB, AMT
5.300%, 12/01/11 1,000 904
Henrico County, Industrial
Development Authority,
Westminster-Canterbury Project,
RB Callable 10/1/09 @ 101
5.700%, 10/01/23 1,610 1,428
Henrico County, Water & Sewer
Authority, RB Callable
05/01/09 @ 102
4.625%, 05/01/17 1,900 1,601
Henry County, GO Callable
07/15/04 @ 102
6.000%, 07/15/14 1,000 1,012
Loudoun County, Sanitation
Authority, Water & Sewer, RB,
FGIC Callable 01/01/03 @ 102
6.100%, 01/01/04 1,250 1,290
Louisa, Industrial Development
Authority, Virginia Electric &
Power Project, Ser A, RB, AMT
5.150%, 04/01/02 2,500 2,480
Lynchburg, GO Callable
04/01/03 @ 102
5.250%, 04/01/08 2,000 1,995
Lynchburg, Industrial Development
Authority, Centra Health Project,
RB Callable 01/01/08 @ 101
5.200%, 01/01/23 500 419
Martinsville, GO Callable
06/19/00 @ 100
3.600%, 01/15/01 1,500 1,490
Medical College, Hospital Authority,
RB, MBIA Callable 07/01/08 @102
4.900%, 07/01/12 1,500 1,381
Montgomery County, Industrial
Development Authority, Ser A,
RB, MBIA Callable 07/03/00 @ 100
3.850%, 01/15/01 1,250 1,242
Newport News, Ser A, GO
4.000%, 07/01/07 2,000 1,798
Norfolk, Ser A, GO
5.250%, 02/01/01 2,200 2,209
Norfolk, GO Callable 06/01/04 @ 101
5.250%, 06/01/08 5,000 4,965
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Norfolk, Industrial Development
Authority, Childrens Hospital
Kings Group, RB, AMBAC
6.900%, 06/01/06 $ 1,000 $ 1,075
Norfolk, Industrial Development
Authority, Health Care Bon
Secours Health Project, RB,
MBIA Callable 08/15/07 @ 102
5.250%, 08/15/26 4,200 3,662
Norfolk, Industrial Development
Authority, Sentara Hospital
Project, Ser A, RB Callable
11/01/04 @ 102
4.900%, 11/01/07 2,500 2,398
5.000%, 11/01/08 2,500 2,408
Norfolk, Redevelopment &
Housing Authority, Educational
Facilities Revenue, Tidewater
Community College Campus
Project, RB Callable 11/01/05 @ 102
5.800%, 11/01/08 700 719
Poquoson, Sewer System, RB
4.250%, 11/01/00 3,000 2,993
Portsmouth, GO Callable
08/01/03 @ 102
5.450%, 08/01/07 2,000 2,014
Prince William County, Park
Authority, RB, ETM
5.800%, 10/15/01 500 506
Prince William County, Park
Authority, RB Prerefunded @ 102 (F)
6.200%, 10/15/04 500 527
Richmond, Metropolitan Expressway
Authority, Ser A, RB, FGIC
Callable 07/15/02 @ 102
5.900%, 07/15/03 1,500 1,534
Roanoke, Industrial Development
Authority, Roanoke Memorial
Hospital Project, Ser B, RB
Callable 07/01/02 @ 102
5.900%, 07/01/06 2,500 2,530
Roanoke County, Industrial
Development Authority, Roanoke
Memorial Hospital Project,
Ser C, RB Callable 06/02/00 @ 100
4.300%, 07/01/19 200 200
Roanoke Valley, Resources
Authority, RB
5.400%, 09/01/02 1,450 1,454
Roanoke Valley, Resources
Authority, RB Prerefunded @102 (F)
5.750%, 09/01/02 500 516
49
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND--CONCLUDED
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Suffolk, GO
5.200%, 08/01/02 $ 1,500 $ 1,506
Suffolk, GO Callable 08/01/03 @ 102
5.600%, 08/01/06 2,000 2,033
5.700%, 08/01/07 2,000 2,036
University of Virginia, Ser A, RB
Callable 06/01/08 @ 101
5.000%, 06/01/24 4,000 3,449
Virginia Beach, GO
5.450%, 07/15/11 1,000 997
Virginia Beach, Development
Authority, Residential & Health
Care Facility Project, 1st Mortgage,
Our Lady of Perpetual Hope
Project, RB Callable 07/01/07 @102
6.050%, 07/01/20 1,500 1,336
Virginia Beach, Development
Authority, Sentara Bayside
Hospital Project, RB Prerefunded
@ 102 (F)
6.300%, 11/01/01 1,750 1,818
Virginia Beach, Development
Authority, Sentra Health System,
RB Callable 11/01/08 @ 101
5.250%, 11/01/11 1,000 956
Virginia Beach, Public Improvements,
GO Prerefunded @ 102 (F)
5.750%, 11/01/04 3,500 3,641
Virginia State, GO
5.600%, 06/01/02 4,750 4,814
Virginia State, College Building
Authority, 21st Century College
Program, RB Callable
08/01/06 @ 102
5.400%, 08/01/16 1,000 941
Virginia State, College Building
Authority, Public Higher Education
Financing Program, Ser A, RB
Callable 09/01/08 @ 100
4.625%, 09/01/15 3,080 2,654
Virginia State, College Building
Authority, University of Richmond
Project, RB Callable 11/01/02 @ 102
6.250%, 11/01/12 2,000 2,065
Virginia State, College Building
Authority, University of
Richmond Project, RB Callable
11/01/04 @ 100
5.550%, 11/01/19 6,500 6,487
Virginia State, Education Loan
Authority, Guaranteed Student
Loan Program, Ser B, RB, AMT
5.550%, 09/01/10 1,800 1,825
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Virginia State, Education Loan
Authority, Guaranteed Student
Loan Program, Ser B, RB,
AMT, ETM
4.850%, 09/01/01 $ 520 $ 520
Virginia State, Education Loan
Authority, Guaranteed Student
Loan Program, Ser D, RB,
AMT, ETM
5.600%, 03/01/03 2,500 2,525
Virginia State, Housing
Development Authority,
Commonwealth Mortgage,
Sub-Ser B-3, RB Callable
01/01/06 @ 102
6.350%, 01/01/15 3,000 3,036
Virginia State, Housing
Development Authority,
Commonwealth Mortgage,
Sub-Ser E-1, RB Callable
07/01/08 @ 101
4.950%, 01/01/11 1,250 1,174
Virginia State, Housing
Development Authority,
Multi-Family Housing, Ser E, RB
Callable 01/01/08 @ 102
5.350%, 11/01/11 1,250 1,204
Virginia State, Housing Development
Authority, Multi-Family Housing,
Ser B, RB Callable 07/03/00 @ 102
7.375%, 05/01/05 1,000 1,021
Virginia State, Housing Development
Authority, Multi-Family Housing,
Ser I, RB, AMT Callable
01/01/09 @ 101
4.875%, 11/01/12 1,950 1,773
Virginia State, Housing Development
Authority, Rental Housing,
Ser H, RB, AMT Callable
11/01/09 @ 100
5.625%, 11/01/18 3,500 3,281
Virginia State, Housing Development
Authority, Single-Family Housing,
Sub-Ser C-4, RB Callable
01/01/02 @ 102
5.550%, 01/01/11 3,000 2,968
Virginia State, Housing Development
Authority, Sub-Ser B-1, RB, AMT
Callable 07/01/06 @ 102
6.375%, 07/01/26 2,500 2,513
50
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Virginia State, Housing Development
Authority, Sub-Ser C-8, RB
Callable 01/01/02 @ 102
6.000%, 07/01/06 $ 2,000 $ 2,025
Virginia State, Housing
Development Authority,
Sub-Ser C-1, RB Callable
01/01/08 @ 102
4.850%, 07/01/09 1,600 1,515
Virginia State, Polytechnic Institute
& University, Ser A, RB Callable
06/01/06 @ 102
5.350%, 06/01/09 2,000 1,993
5.450%, 06/01/13 2,500 2,448
5.500%, 06/01/16 4,435 4,289
Virginia State, Port Authority, RB,
AMT
4.400%, 07/01/00 2,815 2,814
Virginia State, Public School
Authority, RB Callable
01/01/02 @ 102
6.250%, 01/01/08 2,000 2,062
Virginia State, Public School
Authority, School Financing,
Ser I, RB
5.250%, 08/01/09 5,000 4,960
Virginia State, Public School
Authority, Ser B, RB Callable
07/03/00 @ 101.5
5.850%, 01/01/02 1,500 1,520
Virginia State, Transportation Board,
Northern Virginia Tranportation
District, Ser A, RB Callable
05/15/06 @ 101
5.125%, 05/15/12 2,000 1,902
--------
200,963
--------
Total Municipal Bonds
(Cost $207,345) 200,963
--------
CASH EQUIVALENTS (2.6%)
AIM Tax Free Institutional
Cash Reserve 2,758,671 2,759
Federated Virginia Municipal
Cash Trust 2,759,482 2,759
--------
Total Cash Equivalents
(Cost $5,518) 5,518
--------
Total Investments (98.8%)
(Cost $212,863) 206,481
--------
OTHER ASSETS AND LIABILITIES, NET (1.2%) 2,536
--------
--------------------------------------------------------------------------------
VALUE (000)
--------------------------------------------------------------------------------
NET ASSETS:
Fund shares of Trust Shares (unlimited
authorization -- no par value) based
on 21,099,614 outstanding shares of
beneficial interest $210,191
Fund shares of Investor Shares (unlimited
authorization -- no par value) based
on 710,206 outstanding shares of
beneficial interest 7,315
Distribution in excess of net investment
income (42)
Accumulated net realized loss
on investments (2,065)
Net unrealized depreciation on investments (6,382)
--------
Total Net Assets (100.0%) $209,017
========
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 9.58
========
Net Asset Value and Redemption
Price Per Share -- Investor Shares $ 9.59
========
Maximum Offering Price Per Share --
Investor Shares ($9.59 / 96.25%) $ 9.96
========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56.
51
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
VIRGINIA MUNICIPAL BOND FUND
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
MUNICIPAL BONDS (94.7%)
VIRGINIA (93.6%)
Albemarle County, Industrial
Development Authority, Martha
Jefferson Hospital Project, RB
Callable 10/01/03 @ 102
5.800%, 10/01/09 $ 500 $ 503
Alexandria, Industrial
Development Authority,
Episcopal High School Project,
RB Callable 01/01/06 @ 102
5.300%, 01/01/11 500 490
Alexandria, Industrial Development
Authority, Potomac Electric
Project, Ser A, RB, MBIA Callable
02/15/04 @ 102
5.375%, 02/15/24 400 365
Alexandria, Redevelopment &
Housing Authority, Buckingham
Village Apartments Project, Ser A,
RB, AMT Callable 01/01/06 @ 102
6.050%, 07/01/16 250 249
Alexandria, Redevelopment &
Housing Authority, Essex House
Project, Ser A, RB, AMT Callable
01/01/08 @ 102
5.550%, 07/01/28 1,000 892
Arlington County, Industrial
Development Authority, Nature
Conservancy, Ser A, RB Callable
07/01/07 @ 102
5.250%, 07/01/12 300 290
Arlington County, GO Callable
06/01/05 @ 101.50
5.400%, 06/01/12 250 249
Arlington County, Industrial
Development Authority,
Alexandria/Arlington Waste
Project, Ser B, RB, AMT Callable
07/01/08 @ 101
5.375%, 01/01/13 1,000 953
Brunswick County, Industrial
Development Authority, RB,
MBIA Callable 07/01/06 @ 102
5.700%, 07/01/10 1,000 1,017
5.500%, 07/01/17 400 384
Chesapeake Bay, Bridge & Tunnel
Commission, RB, MBIA Callable
07/01/05 @ 102
5.000%, 07/01/22 1,000 865
Chesterfield County, GO
Callable 01/15/10
5.750%, 01/15/15 1,315 1,328
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Culpeper County,
4.250%, 09/01/00 $ 1,325 $ 1,325
Fairfax County, Industrial
Development Authority, Fairfax
Hospital, Ser C, RB (C)
4.250%, 10/01/25 500 500
Fairfax County, Economic
Development Authority, National
Wildlife Federation, RB, MBIA
Callable 09/01/09 @ 101
5.375%, 09/01/29 1,000 908
Fairfax County, Industrial
Development Authority, Fairfax
Hospital, Ser A, RB (C)
3.900%, 10/01/25 800 800
Fairfax County, Industrial
Development Authority, Inova
Health System Project, RB, FSA
5.250%, 08/15/19 500 460
Fairfax County, Public Improvements,
Ser A, GO Callable 06/01/03 @ 102
5.000%, 06/01/07 500 494
Fairfax County, Redevelopment &
Housing Authority, Mott & Gum
Springs Community Centers, RB
Callable 06/01/06 @ 102
5.500%, 06/01/12 425 415
Fairfax County, Redevelopment &
Housing Authority, Paul Spring
Center Project, Ser A, RB, FHA
Callable 12/01/06 @ 103
5.900%, 06/15/17 250 242
Fairfax County, Sewer Improvement
Authority, RB, MBIA Callable
07/15/06 @ 102
5.800%, 07/15/22 1,000 979
Fairfax County, Water Authority, RB
Callable 04/01/07 @ 102
6.000%, 04/01/22 315 316
Fredericksburg, Industrial
Development Authority, Medicorp
Health System Obligation, RB,
AMBAC Callable 06/15/07 @ 102
5.300%, 06/15/10 500 488
5.250%, 06/15/23 300 265
Giles County, Industrial Development
Authority, Hoechst Celanese, RB,
AMT Callable 05/01/06 @ 102
6.450%, 05/01/26 500 472
52
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Greater Richmond, Convention Center
Authority, Convention Center
Expansion Project, RB
Callable 06/15/10 @ 101
5.900%, 06/15/16 $ 835 $ 830
Greater Richmond, Convention
Center Hotel, Convention Center
Expansion Project, RB Callable
6/15/10 @ 101
6.125%, 06/15/25 1,200 1,193
Hampton, Golf Course Project, RB
6.000%, 12/01/12 1,410 1,394
Henrico County, Economic
Development Authority, Beth
Sholom Assisted Living,
Ser A, RB, GNMA Callable
07/20/09 @ 102
5.850%, 07/20/19 400 387
5.900%, 07/20/29 500 477
Henrico County, Industrial
Development Authority, Educational
Facility, Collegiate Schools, RB
Callable 10/15/08 @ 102
5.000%, 10/15/19 1,000 867
Henrico County, Industrial
Development Authority,
Westminster-Canterbury Project,
RB Callable 10/1/09 @ 101
5.700%, 10/01/23 1,000 887
5.700%, 10/01/29 800 698
Henry County, Industrial
Development Authority, Memorial
Hospital, Martinsville & Henry
Hospital Project, RB Callable
01/01/07 @ 101
6.000%, 01/01/17 500 492
James City County, GO, FGIC
Callable 12/15/05 @ 102
5.250%, 12/15/14 250 241
Loudoun County, Sanitation
Authority, Water & Sewer Project,
RB, FGIC Callable 01/01/07 @ 102
5.125%, 01/01/26 500 435
Loudoun County, Public
Improvement Project, Ser C,
GO Callable 12/01/09 @ 101
5.750%, 12/01/19 1,050 1,035
Lynchburg, Industrial Development
Authority, Health Care Facility,
Centra Health Project, RB
Callable 01/01/08 @ 101
5.200%, 01/01/23 500 419
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Lynchburg, Public Improvements,
GO Callable 05/01/06 @ 102
5.100%, 05/01/11 $ 500 $ 484
Manassas Park, GO, FSA Callable
04/01/09 @ 101
5.100%, 04/01/22 500 442
Manassas, Ser A, GO Callable
01/01/08 @ 102
5.000%, 01/01/18 500 447
Newport News, BAN
4.500%, 06/15/00 1,500 1,500
Newport News, Ser A, GO, MBIA
Callable 07/01/05 @ 102
5.625%, 07/01/14 1,500 1,500
Newport News, Redevelopment &
Housing Authority, Ser A, RB,
GNMA Callable 08/20/07 @102
5.850%, 12/20/30 500 475
Norfolk, Water Authority, RB,
AMBAC Callable 11/01/03 @ 102
5.625%, 11/01/23 690 631
Norfolk, Industrial Development
Authority, Health Care, Bon
Secours Health System Project,
RB, MBIA Callable 08/15/07 @ 102
5.250%, 08/15/17 750 686
Norfork, GO Callable 02/01/03 @ 102
5.500%, 02/01/13 475 468
Portsmouth, GO, FGIC Callable
08/01/06 @ 101
5.250%, 08/01/21 500 453
Richmond, Public Improvements,
Ser B, GO, Callable 01/15/01 @ 102
6.250%, 01/15/18 1,000 1,028
Riverside, Regional Jail Authority,
Correctional Facility Improvements
Project, RB, MBIA Callable
07/01/05 @ 102
5.875%, 07/01/14 2,000 2,019
Roanoke County, Industrial
Development Authority, Roanoke
Memorial Hospital Project,
Ser C, RB Callable 06/09/00 @ 100
4.300%, 07/01/19 965 965
Roanoke, Public Improvements, GO
Callable 08/01/04 @ 102
5.150%, 08/01/12 250 240
Spotsylvania County, GO, FSA
5.000%, 07/15/14 1,000 941
Spotsylvania County, Water & Sewer
System, RB, MBIA Callable
06/01/07 @ 102
5.250%, 06/01/12 500 484
53
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
VIRGINIA MUNICIPAL BOND FUND--CONCLUDED
--------------------------------------------------------------------------------
FACE AMOUNT
(000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Spotsylvania County, Water
& Sewer System Authority, RB,
MBIA Callable 06/01/07 @ 102
5.400%, 06/01/27 $ 1,000 $ 915
Virginia Beach, GO
5.450%, 07/15/11 200 199
Virginia State, Biotechnology
Research Park Authority, Biotech
Two Project, RB Callable
09/01/06 @ 101
5.250%, 09/01/18 500 461
Virginia State, College Building
Authority, Educational Facilities,
Marymount University Project, RB,
Callable 07/01/08 @ 102
5.100%, 07/01/18 1,000 881
Virginia State, College Building
Authority, Washington & Lee
University Project, RB, MBIA
5.250%, 01/01/31 1,100 989
Virginia State, Housing Development
Authority, Commonwealth
Mortgage Project, Sub-Ser E-3,
RB Callable 07/01/08 @ 101
5.125%, 07/01/17 2,000 1,795
Virginia State, Housing
Development Authority,
Commonwealth Mortgage Project,
Sub-Ser A-4, RB, AMT,
MBIA Callable 01/01/06 @ 102
6.350%, 07/01/18 150 151
Virginia State, Housing Development
Authority, Commonwealth
Mortgage Project, Sub-Ser A-1,
RB Callable 01/01/03 @ 102
6.400%, 07/01/17 875 886
Virginia State, Housing Development
Authority, Commonwealth
Mortgage Project, Sub-Ser E-2,
RB Callable 07/01/08 @101
5.250%, 07/01/17 1,000 912
Virginia State, Polytechnic Institute
& State University, University
Service Systems, Ser C, RB
Callable 06/01/06 @ 102
5.500%, 06/01/16 200 193
Virginia State, Public Building
Authority, Public Improvements,
RB Callable 08/01/05 @ 101
5.200%, 08/01/16 300 279
--------------------------------------------------------------------------------
SHARES/FACE
AMOUNT (000) VALUE (000)
--------------------------------------------------------------------------------
VIRGINIA--CONTINUED
Virgina State, Public Building
Authority, Ser A, Callable
08/01/10 @ 100
5.750%, 08/01/16 $ 1,500 $ 1,494
Virginia State, Public School
Authority, School Financing,
Ser A, RB Callable 08/01/07 @ 102
5.375%, 08/01/18 500 470
Virginia State, Resource Authority,
RB, MBIA Callable 05/01/11 @ 101
5.800%, 05/01/30 1,500 1,456
Virginia State, University of
Virginia, Ser A, RB Callable
05/01/06 @ 102
5.625%, 05/01/16 1,000 981
West Point, Industrial Development
Authority, Chesapeake Project,
Ser B, RB Callable 03/01/04 @ 102
6.250%, 03/01/19 165 151
Williamsburg, Industrial
Development Authority,
Williamsburg Community
Hospital, RB Callable
10/01/03 @ 102
5.750%, 10/01/22 1,450 1,302
-------
50,882
-------
PUERTO RICO (1.1%)
Commonwealth, San Lucas & Cristo
Project, Ser A , RB Callable
06/01/09 @ 101
5.750%, 06/01/29 740 604
-------
Total Municipal Bonds
(Cost $53,737) 51,486
-------
CASH EQUIVALENTS (2.2%)
AIM Tax Free Institutional
Cash Reserve 602,404 602
Federated Virginia Municipal
Cash Trust 601,758 602
-------
Total Cash Equivalents
(Cost $1,204) 1,204
-------
Total Investments (96.9%)
(Cost $54,941) 52,690
-------
OTHER ASSETS AND LIABILITIES, NET (3.1%) 1,657
-------
54
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
VALUE (000)
--------------------------------------------------------------------------------
NET ASSETS:
Fund shares of Trust Shares (unlimited
authorization -- no par value) based
on 5,080,916 outstanding shares of
beneficial interest $51,256
Fund shares of Flex Shares (unlimited
authorization -- no par value) based
on 554,190 outstanding shares of
beneficial interest 5,910
Distribution in excess of net investment
income (24)
Accumulated net realized loss
on investments (544)
Net unrealized depreciation on investments (2,251)
-------
Total Net Assets (100.0%) $54,347
=======
Net Asset Value, Offering and Redemption
Price Per Share -- Trust Shares $ 9.64
=======
Net Asset Value, Offering and Redemption
Price Per Share -- Flex Shares (1) $ 9.68
=======
(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 56.
55
<PAGE>
STATEMENT OF NET ASSETS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
KEY TO ABBREVIATIONS USED IN
THE STATEMENT OF NET ASSETS
AMBAC Security insured by the American Municipal
Bond Assurance Corporation
AMT Alternative Minimum Tax
BAN Bond Anticipation Note
Cl Class
COP Certificate of Participation
ETM Escrowed to Maturity
FGIC Security insured by the Financial Guaranty
Insurance Company
FFCB Federal Farm Credit Bank
FHA Federal Housing Authority
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
FSA Security insured by Financial Security
Assurance
GNMA Government National Mortgage Association
GO General Obligation
MBIA Security insured by the Municipal Bond
Insurance Association
MTN Medium Term Note
PLC Public Limited Company
RB Revenue Bond
REMIC Real Estate Mortgage Investment Conduit
Ser Series
STRIPS Separately Traded Registered Interest and
Principal Security
TA Tax Allocation
(A) Zero Coupon Bond
(B) Private Placement Security
(C) Adjustable rate security. The rate reported on
the Statement of Net Assets is the rate in effect
on May 31, 2000.
(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) Prerefunded Security. The maturity date shown
is the prerefunded date.
(G) Tri-Party Repurchase Agreement
56
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (000)
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
<TABLE>
<CAPTION>
Investment Grade
Tax-Exempt
Bond Fund
----------------
ASSETS:
<S> <C>
Investments at value (Cost $165,479) ............................................. $164,613
Cash ............................................................................. 182
Accrued income ................................................................... 2,952
Receivable for investment securities sold ........................................ 10,273
Receivable for portfolio shares purchased ........................................ 184
--------
Total Assets ..................................................................... 178,204
--------
LIABILITIES:
Payable for investment securities purchased ...................................... 25,883
Accrued expenses ................................................................. 146
Payable for portfolio shares redeemed ............................................ 134
Distributions payable ............................................................ 536
--------
Total liabilities ................................................................... 26,699
--------
Net Assets .......................................................................... $151,505
========
NET ASSETS:
Fund shares of Trust Shares (unlimited authorization -- no par value) based on
10,998,329 outstanding shares of beneficial interest ............................. $122,291
Fund shares of Investor Shares (unlimited authorization -- no par value) based on
1,820,120 outstanding shares of beneficial interest .............................. 19,153
Fund shares of Flex Shares (unlimited authorization -- no par value) based on
1,375,312 outstanding shares of beneficial interest .............................. 15,610
Distribution in excess of net investment income ..................................... (5)
Accumulated net realized loss on investments ........................................ (4,678)
Net unrealized depreciation on investments .......................................... (866)
--------
Total Net Assets (100.0%) ........................................................... $151,505
========
Net Asset Value, Offering and Redemption Price Per Share -- Trust Shares ............ $ 10.67
========
Net Asset Value and Redemption Price Per Share -- Investor Shares ................... $ 10.68
========
Maximum Offering Price Per Share -- Investor Shares ($10.68 / 96.25%) ............... $ 11.10
========
Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) ......... $ 10.67
========
</TABLE>
(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.
57
<PAGE>
STATEMENTS OF OPERATIONS (000)
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, 2000 AND MARCH 31,
2000
<TABLE>
<CAPTION>
INVESTMENT
FLORIDA GEORGIA HIGH INVESTMENT GRADE
TAX-EXEMPT TAX-EXEMPT INCOME GRADE BOND TAX-EXEMPT
BOND FUND BOND FUND FUND (1) FUND BOND FUND
---------- ---------- -------------------- ----------- -----------
06/01/99- 06/01/99 - 04/01/00 04/01/99 - 06/01/99 - 06/01/99 -
05/31/00 05/31/00 05/31/00 03/31/00 05/31/00 05/31/00
---------- ---------- -------------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Interest Income ....................................... $ 5,916 $ 4,720 $ 35 $ 643 $ 78,585 $8,255
------- ------- ---- ----- -------- ------
Expenses:
Investment Advisory Fees ........................... 780 637 3 60 8,537 1,285
Less: Investment Advisory Fees
Waived (Reimbursed) ............................ (130) (113) (3) (74) (798) (109)
Administrator Fees ................................. 85 69 -- 9 817 123
Transfer Agent Fees-- Trust Shares ................. 17 16 -- -- 21 16
Transfer Agent Fees-- Investor Shares .............. 13 15 -- -- 31 17
Transfer Agent Fees-- Flex Shares .................. 17 16 3 -- 39 21
Transfer Agent Out of Pocket Expenses .............. 9 7 -- 19 28 4
Printing Expenses .................................. 8 7 -- -- 35 --
Custody Fees ....................................... 7 5 -- 9 42 --
Professional Fees .................................. 8 7 -- 14 65 --
Trustee Fees ....................................... 1 1 -- -- 12 --
Registration Fees .................................. 7 11 -- 16 62 13
Distribution Fees-- Investor Shares ................ 6 6 -- -- 129 96
Less: Distribution Fees Waived-- Investor Shares ... (6) (6) -- -- (38) (22)
Distribution Fees-- Flex Shares .................... 127 113 4 18 249 163
Less: Distribution Fees Waived-- Flex Shares ....... (53) (47) (2) -- (65) (38)
Insurance and Other Fees ........................... 7 1 1 36 53 2
------- ------- ---- ----- -------- ------
Total Expenses ..................................... 903 745 6 107 9,219 1,571
------- ------- ---- ----- -------- ------
Net Investment Income ................................. 5,013 3,975 29 536 69,366 6,684
------- ------- ---- ----- -------- ------
Net Realized and Unrealized Gain (Loss)
on Investments:
Net Realized Loss on Securities Sold ............... (2,256) (836) -- (768) (37,713) (4,664)
Net Change in Unrealized Depreciation
on Investments ...................................... (3,755) (4,265) (30) (130) (50,059) (287)
------- ------- ---- ----- -------- ------
Total Net Realized and Unrealized Loss
on Investments ...................................... (6,011) (5,101) (30) (898) (87,772) (4,951)
------- ------- ---- ----- -------- ------
Net Increase (Decrease) in Net Assets
from Operations ................................ $ (998) $(1,126) $ (1) $(362) $(18,406) $1,733
======= ======= ==== ===== ======== ======
Amounts designated as "--" are either $0 or round to $0.
(1) ON MARCH 27, 2000, THE ESC STRATEGIC INCOME FUND EXCHANGED ALL OF ITS ASSETS
AND CERTAIN LIABILITIES FOR SHARES OF THE HIGH INCOME FUND. THE ESC STRATEGIC
INCOME FUND IS THE ACCOUNTING SURVIVOR IN THIS TRANSACTION, AND AS A RESULT, ITS
BASIS OF ACCOUNTING FOR ASSETS AND LIABILITIES AND ITS OPERATING RESULTS FOR THE
PERIODS PRIOR TO MARCH 27, 2000 HAVE BEEN CARRIED FORWARD IN THESE FINANCIAL
HIGHLIGHTS. SUBSEQUENT TO THE MERGER, THE HIGH INCOME FUND CHANGED ITS FISCAL
YEAR-END TO MAY 31.
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
58
<PAGE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
LIMITED-
TERM FEDERAL SHORT-TERM VIRGINIA
MORTGAGE MARYLAND U.S. TREASURY U.S. INTERMEDIATE VIRGINIA
SECURITIES MUNICIPAL SHORT-TERM SECURITIES GOVERNMENT MUNICIPAL MUNICIPAL
FUND BOND FUND BOND FUND FUND SECURITIES FUND BOND FUND BOND FUND
------------ ---------- ---------- ------------- --------------- ------------ -----------
06/01/99 - 06/01/99 - 06/01/99 - 06/01/99 - 06/01/99 - 06/01/99 - 06/01/99 -
05/31/00 05/31/00 05/31/00 05/31/00 05/31/00 05/31/00 05/31/00
------------ ---------- ---------- ------------- --------------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
$ 8,706 $ 1,726 $12,129 $3,593 $ 6,711 $ 11,824 $ 2,433
------- ------- ------- ------ ------- -------- -------
904 228 1,295 435 758 1,551 300
(162) (42) (185) (88) (88) -- (20)
98 25 141 47 73 170 36
13 16 17 15 16 7 16
12 -- 14 14 14 13 --
14 15 14 16 22 -- 13
14 2 14 6 7 -- 2
10 2 13 5 8 4 3
8 1 8 4 6 4 3
13 2 10 4 7 20 5
1 -- 3 1 1 -- --
17 -- 9 7 11 -- 2
4 -- 4 5 8 11 --
(3) -- (4) (5) (8) (11) --
22 75 21 56 104 -- 62
(22) (18) (21) (47) (48) -- (26)
9 2 2 2 4 -- 3
------- ------- ------- ------ ------- -------- -------
952 308 1,355 477 895 1,769 399
------- ------- ------- ------ ------- -------- -------
7,754 1,418 10,774 3,116 5,816 10,055 2,034
------- ------- ------- ------ ------- -------- -------
(2,174) (237) (2,130) (8) (1,586) (1,940) (544)
(2,454) (1,990) (3,306) (621) (2,873) (11,451) (2,611)
------- ------- ------- ------ ------- -------- -------
(4,628) (2,227) (5,436) (629) (4,459) (13,391) (3,155)
------- ------- ------- ------ ------- -------- -------
$ 3,126 $ (809) $ 5,338 $2,487 $ 1,357 $ (3,336) $(1,121)
======= ======= ======= ====== ======= ======== =======
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
59
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS (000)
--------------------------------------------------------------------------------
<TABLE>
STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, MARCH 31, AND
NOVEMBER 30,
FLORIDA TAX-EXEMPT GEORGIA TAX-EXEMPT
BOND FUND BOND FUND HIGH INCOME FUND
---------------------- ----------------------- ------------------------------
06/01/99- 06/01/98- 06/01/99- 06/01/98- 04/01/00- 04/01/99 04/01/98
05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 03/31/00 03/31/99
---------------------- ----------------------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Operations:
Net Investment Income ....................... $ 5,013 $ 4,737 $ 3,975 $ 3,344 $ 29 $ 536 $ 852
Net Realized Gain (Loss) on Investments ..... (2,256) 1,160 (836) 414 -- (768) 57
Net Change in Unrealized Appreciation
(Depreciation) on Investments ............. (3,755) (1,845) (4,265) (1,241) (30) (130) (194)
-------- -------- --------- -------- ------ ------- --------
Increase (Decrease) in Net Assets
from Operations ......................... (998) 4,052 (1,126) 2,517 (1) (362) 715
-------- -------- --------- -------- ------ ------- --------
Distributions to Shareholders:
Net Investment Income:
Trust Shares .............................. (4,437) (4,235) (3,459) (2,897) -- -- --
Investor Shares ........................... (127) (134) (129) (128) -- -- --
Flex Shares ............................... (449) (369) (388) (318) (29) (479)* (759)
Class D Shares ............................ -- -- -- -- -- (39) (33)
Tax Return of Capital:
Class D Shares ............................ -- -- -- -- -- -- (77)
Flex Shares ............................... -- -- -- -- -- -- (3)*
Capital Gains:
Trust Shares .............................. (400) (1,037) (301) (162) -- -- --
Investor Shares ........................... (12) (37) (13) (8) -- -- --
Flex Shares ............................... (46) (122) (42) (20) -- -- (105)*
Class D Shares ............................ -- -- -- -- -- -- (9)
-------- -------- --------- -------- ------ ------- --------
Total Distributions ......................... (5,471) (5,934) (4,332) (3,533) (29) (518) (986)
-------- -------- --------- -------- ------ ------- --------
Capital Transactions (1):
Trust Shares:
Proceeds from Shares Issued ............... 28,674 51,929 26,583 36,255 -- -- --
Shares Issued in Connection with
Crestar Merger .......................... -- -- -- -- -- -- --
Reinvestment of Cash Distributions 889 1,663 1,355 1,180 -- -- --
Cost of Shares Repurchased (49,546) (27,307) (29,630) (11,514) -- -- --
-------- -------- --------- -------- ------ ------- --------
Increase (Decrease) in Net Assets From Trust
Share Transactions (19,983) 26,285 (1,692) 25,921 -- -- --
-------- -------- --------- -------- ------ ------- --------
Investor Shares:
Proceeds from Shares Issued 165 1,105 557 1,195 -- -- --
Shares Issued in Connection with
Crestar Merger .......................... -- -- -- -- -- -- --
Reinvestment of Cash Distributions ........ 120 143 108 118 -- -- --
Cost of Shares Repurchased ................ (1,034) (780) (1,698) (1,586) -- -- --
-------- -------- --------- -------- ------ ------- --------
Increase (Decrease) in Net Assets From Investor
Share Transactions ........................ (749) 468 (1,033) (273) -- -- --
-------- -------- --------- -------- ------ ------- --------
Flex Shares:
Proceeds from Shares Issued ............... 2,953 11,906 1,933 5,982 1,165 851 926
Shares Issued in Connection with ESC Merger -- -- -- -- -- 352 --
Shares Issued in Connection with
Crestar Merger ......................... -- -- -- -- -- -- --
Reinvestment of Cash Distributions ....... 427 433 410 304 21 463 894
Cost of Shares Repurchased ............... (7,643) (5,520) (6,201) (1,034) (113) (6,073) (18,743)
-------- -------- --------- -------- ------ ------- --------
Increase (Decrease) in Net Assets From Flex
Share Transactions ....................... (4,263) 6,819 (3,858) 5,252 1,073 (4,407) (16,923)
-------- -------- --------- -------- ------ ------- --------
Class D:
Proceeds from Shares Issued .............. -- -- -- -- -- 42 156
Reinvestment of Cash Distributions ....... -- -- -- -- -- 42 41
Value of Shares Exchanged in Connection
with Merger ...................... -- -- -- -- -- (352) --
Cost of Shares Repurchased ............... -- -- -- -- -- (191) (461)
-------- -------- --------- -------- ------ ------- --------
Increase (Decrease) in Net Assets From
Class D Share Transactions ............... -- -- -- -- -- (459) (264)
-------- -------- --------- -------- ------ ------- --------
Increase (Decrease) in Net Assets From
Share Transactions ....................... (24,995) 33,572 (6,583) 30,900 1,073 (4,866) (17,187)
-------- -------- --------- -------- ------ ------- --------
Total Increase (Decrease) in Net Assets (31,464) 31,690 (12,041) 29,884 1,043 (5,746) (17,458)
-------- -------- --------- -------- ------ ------- --------
Net Assets:
Beginning of Period ........................ 137,170 105,480 104,486 74,602 2,032 7,778 25,236
-------- -------- --------- -------- ------ ------- --------
End of Period .............................. $105,706 $137,170 $ 92,445 $104,486 $3,075 $ 2,032 $ 7,778
======== ======== ========= ======== ====== ======= ========
* Formerly Class A Shares
(1) See Note 6 in the notes to the financial statements for additional
information.
Amounts designated as "--" are either $0 or round to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS
60
<PAGE>
-----------------------------------------------------------------------------------------------------------------------------------
INVESTMENT GRADE INVESTMENT GRADE TAX- LIMITED-TERM FEDERAL MARYLAND MUNICIPAL
BOND FUND EXEMPT BOND FUND MORTGAGE SECURITIES FUND BOND FUND
-------------------- -------------------- ------------------------ ------------------------------
06/01/99- 06/01/98- 06/01/99- 06/01/98- 06/01/99- 06/01/98- 06/01/99- 12/01/98- 12/01/97-
05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 05/31/99 11/30/98
--------- --------- --------- --------- --------- ---------- --------- --------- ---------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 69,366 $ 45,781 $ 6,684 $ 6,793 $ 7,754 $ 7,741 $ 1,418 $ 497 $ 701
(37,713) 15,248 (4,664) 4,833 (2,174) 88 (237) (19) 58
(50,059) (27,720) (287) (3,278) (2,454) (1,037) (1,990) (437) 406
---------- --------- ------- ------- ------- --------- ------- ------- -------
(18,406) 33,309 1,733 8,348 3,126 6,792 (809) 41 1,165
---------- --------- ------- ------- ------- --------- ------- ------- -------
(66,271) (43,474) (5,389) (5,587) (7,518) (7,568) (1,195) (425) (645)
(1,676) (1,621) (798) (901) (93) (125) -- -- --
(1,277) (807) (504) (305) (110) (83) (257) (77) (56)
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
-- (13,468) (1,805) (4,790) -- (1,611) -- (24) --
-- (547) (295) (914) -- (28) -- -- --
-- (306) (216) (323) -- (19) -- (4) --
-- -- -- -- -- -- -- -- --
---------- --------- ------- ------- ------- --------- ------- ------- -------
(69,224) (60,223) (9,007) (12,820) (7,721) (9,434) (1,452) (530) (701)
---------- --------- ------- ------- ------- --------- ------- ------- -------
254,865 310,338 29,272 58,516 52,959 54,404 18,759 15,770 13,041
-- 314,362 -- -- -- -- -- -- --
36,906 42,773 2,726 5,421 4,795 6,287 200 14 11
(358,628) (286,648) (63,059) (52,929) (63,196) (60,354) (20,670) (4,854) (5,813)
---------- --------- ------- ------- ------- --------- ------- ------- -------
(66,857) 380,825 (31,061) 11,008 (5,442) 337 (1,711) 10,930 7,239
---------- --------- ------- ------- ------- --------- ------- ------- -------
3,327 8,100 686 2,158 307 853 -- -- --
-- 2,385 -- -- -- -- -- -- --
1,676 2,052 980 1,627 93 151 -- -- --
(15,192) (9,990) (6,471) (6,100) (1,359) (1,458) -- -- --
---------- --------- ------- ------- ------- --------- ------- ------- -------
(10,189) 2,547 (4,805) (2,315) (959) (454) -- -- --
---------- --------- ------- ------- ------- --------- ------- ------- -------
9,687 19,438 7,055 10,543 792 1,082 2,326 4,739 2,772
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
1,235 1,002 670 551 103 96 216 66 41
(15,042) (6,765) (8,916) (2,643) (1,233) (566) (3,563) (226) (177)
---------- --------- ------- ------- ------- --------- ------- ------- -------
(4,120) 13,675 (1,191) 8,451 (338) 612 (1,021) 4,579 2,636
---------- --------- ------- ------- ------- --------- ------- ------- -------
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
---------- ---------- ------- ------- ------- --------- ------- ------- -------
-- -- -- -- -- -- -- -- --
---------- ---------- ------- ------- ------- --------- ------- ------- -------
(81,166) 397,047 (37,057) 17,144 (6,739) 495 (2,732) 15,509 9,875
---------- ---------- ------- ------- ------- --------- ------- ------- -------
(168,796) 370,133 (44,331) 12,672 (11,334) (2,147) (4,993) 15,020 10,339
---------- ---------- ------- ------- ------- --------- ------- ------- -------
1,210,001 839,868 195,836 183,164 139,589 141,736 37,381 22,361 12,022
---------- ---------- -------- ------- ------- --------- ------- ------- -------
$1,041,205 $1,210,001 $151,505 $195,836 $128,255 $139,589 $32,388 $37,381 $22,361
========== ========== ======== ======== ======== ======== ======= ======= =======
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS
61
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS (000)
-----------------------------------------------------------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, AND NOVEMBER 30,
SHORT-TERM SHORT-TERM U.S. TREASURY
BOND FUND SECURITIES FUND
------------------------- --------------------------
06/01/99- 06/01/98- 06/01/99- 06/01/98-
05/31/00 05/31/99 05/31/00 05/31/99
---------- ---------- ---------- -----------
Operations:
<S> <C> <C> <C> <C>
Net Investment Income ................................ $ 10,774 $ 6,990 $ 3,116 $ 2,525
Net Realized Gain (Loss) on Investments .............. (2,130) 414 (8) 243
Net Change in Unrealized Appreciation
(Depreciation) on Investments .................. (3,306) (2,357) (621) (388)
-------- -------- ------- -------
Increase (Decrease) in Net Assets from Operations .. 5,338 5,047 2,487 2,380
-------- -------- ------- -------
Distributions to Shareholders:
Net Investment Income:
Trust Shares ....................................... (10,579) (6,805) (2,756) (2,281)
Investor Shares .................................... (91) (92) (122) (133)
Flex Shares ........................................ (103) (95) (238) (111)
Capital Gains:
Trust Shares ....................................... (139) (356) (7) --
Investor Shares .................................... (1) (4) -- --
Flex Shares ........................................ (2) (5) (1) --
-------- -------- ------- -------
Total Distributions .................................. (10,915) (7,357) (3,124) (2,525)
-------- -------- ------- -------
Capital Transactions (1):
Trust Shares:
Proceeds from Shares Issued ........................ 51,792 57,981 31,143 17,499
Shares Issued in Connection with Crestar Merger .... -- 72,757 -- --
Reinvestment of Cash Distributions ................. 4,667 3,614 1,435 951
Cost of Shares Repurchased ......................... (80,493) (42,626) (15,480) (9,243)
-------- -------- ------- -------
Increase (Decrease) in Net Assets From Trust Share
Transactions ....................................... (24,034) 91,726 17,098 9,207
-------- -------- ------- -------
Investor Shares:
Proceeds from Shares Issued ........................ 402 589 738 1,382
Reinvestment of Cash Distributions ................. 88 94 122 133
Cost of Shares Repurchased ......................... (821) (781) (1,566) (1,983)
-------- -------- ------- -------
Increase (Decrease) in Net Assets From Investor
Share Transactions ................................. (331) (98) (706) (468)
-------- -------- ------- -------
Flex Shares:
Proceeds from Shares Issued ........................ 1,164 2,540 3,365 5,314
Shares Issued in Connection with Crestar Merger .... -- -- -- --
Reinvestment of Cash Distributions ................. 107 96 218 94
Cost of Shares Repurchased ......................... (1,486) (2,365) (3,068) (1,855)
-------- -------- ------- -------
Increase (Decrease) in Net Assets From Flex
Share Transactions .............................. (215) 271 515 3,553
-------- -------- ------- -------
Increase (Decrease) in Net Assets From Share
Transactions .................................... (24,580) 91,899 16,907 12,292
-------- -------- ------- -------
Total Increase (Decrease) in Net Assets .......... (30,157) 89,589 16,270 12,147
-------- -------- ------- -------
Net Assets:
Beginning of Period .................................. 214,070 124,481 63,757 51,610
-------- -------- ------- -------
End of Period ........................................ $183,913 $214,070 $ 80,027 $63,757
======== ======== ======== =======
(1) See Note 6 in the notes to the financial statements for additional
information.
Amounts designated as "--" are either $0 or round to $0.
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS
62
<PAGE>
<TABLE>
------------------------------------------------------------------------------------------------------------------------------------
U. S. GOVERNMENT
SECURITIES FUND VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND VIRGINIA MUNICIPAL BOND FUND
----------------------- ----------------------------------------- ----------------------------------
06/01/99- 06/01/98- 06/01/99- 12/01/98- 12/01/97- 06/01/99- 12/01/98- 12/01/97-
05/31/00 05/31/99 05/31/00 05/31/99 11/30/98 05/31/00 05/31/99 11/30/98
--------- --------- ----------- ---------- -------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 5,816 $ 2,793 $ 10,055 $ 5,222 $ 10,809 $ 2,034 $ 734 $ 1,203
(1,586) 15 (1,940) 1,177 1,725 (544) 31 175
(2,873) (1,299) (11,451) (5,509) 2,380 (2,611) (722) 507
------- ------- -------- -------- -------- -------- ------ -------
1,357 1,509 (3,336) 890 14,914 (1,121) 43 1,885
------- ------- -------- -------- -------- -------- ------ -------
(5,199) (2,385) (9,828) (5,069) (10,471) (1,835) (650) (1,116)
(111) (153) (320) (166) (364) -- -- --
(506) (252) -- -- -- (223) (88) (87)
-- -- (1,262) (1,670) (793) (27) (155) (50)
-- -- (39) (56) (28) -- -- --
-- -- -- -- -- (4) (20) (4)
------- ------- -------- -------- -------- -------- ------ -------
(5,816) (2,790) (11,449) (6,961) (11,656) (2,089) (913) (1,257)
------- ------- -------- -------- -------- -------- ------ -------
27,984 23,161 26,550 26,357 36,891 32,391 7,281 13,751
-- 56,128 -- -- -- -- -- --
1,272 520 952 43 629 262 29 60
(42,103) (11,462) (51,050) (24,041) (34,155) (12,912) (3,890) (5,172)
------- ------- -------- -------- -------- -------- ------ -------
(12,847) 68,347 (23,548) 2,359 3,365 19,741 3,420 8,639
------- ------- -------- -------- -------- -------- ------ -------
416 956 1,441 653 2,174 -- -- --
111 152 275 164 289 -- -- --
(1,560) (1,762) (2,155) (821) (2,503) -- -- --
------- ------- -------- -------- -------- -------- ------ -------
(1,033) (654) (439) (4) (40) -- -- --
------- ------- -------- -------- -------- -------- ------ -------
2,396 5,920 -- -- -- 1,607 3,816 2,474
-- 3,174 -- -- -- -- -- --
443 206 -- -- -- 153 77 64
(6,144) (1,637) -- -- -- (2,822) (514) (376)
------- ------- -------- -------- -------- -------- ------ -------
(3,305) 7,663 -- -- -- (1,062) 3,379 2,162
------- ------- -------- -------- -------- -------- ------ -------
(17,185) 75,356 (23,987) 2,355 3,325 18,679 6,799 10,801
------- ------- -------- -------- -------- -------- ------ -------
(21,644) 74,075 (38,772) (3,716) 6,583 15,469 5,929 11,429
------- ------- -------- -------- -------- -------- ------ -------
116,221 42,146 247,789 251,505 244,922 38,878 32,949 21,520
------- ------- -------- -------- -------- -------- ------ -------
$ 94,577 $116,221 $209,017 $247,789 $251,505 $ 54,347 $38,878 $32,949
======== ======== ======== ======== ======== ======== ======= =======
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS
63
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, (UNLESS OTHERWISE
INDICATED) FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS
NET ASSET NET REALIZED AND DISTRIBUTIONS DISTRIBUTIONS
VALUE NET UNREALIZED GAINS FROM NET DISTRIBUTIONS FROM TAX NET ASSET
BEGINNING INVESTMENT (LOSSES) INVESTMENT FROM REALIZED RETURN OF VALUE END
OF PERIOD INCOME ON INVESTMENTS INCOME CAPITAL GAINS CAPITAL OF PERIOD
---------- ----------- ---------------- ------------- ------------- ------------- ---------
Florida Tax-Exempt Bond Fund
Trust Shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
2000 $10.59 $ 0.44 $(0.49) $(0.44) $(0.04) $ -- $10.06
1999 10.72 0.42 (0.02) (0.42) (0.11) -- 10.59
1998 10.28 0.44 0.45 (0.44) (0.01) -- 10.72
1997 10.06 0.46 0.25 (0.46) (0.03) -- 10.28
1996 10.18 0.46 (0.07) (0.46) (0.05) -- 10.06
Investor Shares
2000 $10.60 $ 0.42 $(0.49) $(0.42) $(0.04) $ -- $10.07
1999 10.72 0.40 (0.01) (0.40) (0.11) -- 10.60
1998 10.29 0.42 0.44 (0.42) (0.01) -- 10.72
1997 10.07 0.44 0.25 (0.44) (0.03) -- 10.29
1996 10.18 0.44 (0.06) (0.44) (0.05) -- 10.07
Flex Shares
2000 $10.62 $ 0.36 $(0.49) $(0.36) $(0.04) $ -- $10.09
1999 10.74 0.35 (0.01) (0.35) (0.11) -- 10.62
1998 10.30 0.37 0.45 (0.37) (0.01) -- 10.74
1997 10.08 0.39 0.25 (0.39) (0.03) -- 10.30
1996(1) 10.19 0.39 (0.06) (0.39) (0.05) -- 10.08
Georgia Tax-Exempt Bond Fund
Trust Shares
2000 $10.03 $ 0.40 $(0.49) $(0.40) $(0.04) $ -- $ 9.50
1999 10.11 0.39 (0.06) (0.39) (0.02) -- 10.03
1998 9.73 0.41 0.39 (0.41) (0.01) -- 10.11
1997 9.56 0.42 0.22 (0.42) (0.05) -- 9.73
1996 9.63 0.43 (0.05) (0.43) (0.02) -- 9.56
Investor Shares
2000 $10.05 $ 0.38 $(0.50) $(0.38) $(0.04) $ -- $ 9.51
1999 10.13 0.37 (0.06) (0.37) (0.02) -- 10.05
1998 9.74 0.39 0.40 (0.39) (0.01) -- 10.13
1997 9.58 0.40 0.21 (0.40) (0.05) -- 9.74
1996 9.65 0.41 (0.05) (0.41) (0.02) -- 9.58
Flex Shares
2000 $10.04 $ 0.33 $(0.49) $(0.33) $(0.04) $ -- $ 9.51
1999 10.12 0.32 (0.06) (0.32) (0.02) -- 10.04
1998 9.73 0.34 0.40 (0.34) (0.01) -- 10.12
1997 9.56 0.35 0.22 (0.35) (0.05) -- 9.73
1996(2) 9.72 0.36 (0.14) (0.36) (0.02) -- 9.56
High Income Fund (A)
Flex Shares
2000(4) $ 7.98 $ 0.09 $(0.10) $(0.09) $ -- $ -- $ 7.88
For the years ended March 31:
2000 9.77 0.87 (1.85) (0.81) -- -- 7.98
1999 9.99 0.51 0.04 (0.57) (0.15) (0.05) 9.77
1998 9.73 0.34 0.44 (0.52) -- -- 9.99
1997 9.89 0.60 (0.16) (0.60) -- -- 9.73
1996 9.94 0.59 0.16 (0.59) (0.21) -- 9.89
Investment Grade Bond Fund
Trust Shares
2000 $10.36 $ 0.61 $(0.78) $(0.61) $ -- $ -- $ 9.58
1999 10.65 0.56 (0.11) (0.56) (0.18) -- 10.36
1998 10.16 0.60 0.49 (0.60) -- -- 10.65
1997 10.07 0.60 0.09 (0.60) -- -- 10.16
1996 10.26 0.60 (0.19) (0.60) -- -- 10.07
Investor Shares
2000 $10.36 $ 0.57 $(0.78) $(0.57) $ -- $ -- $ 9.58
1999 10.65 0.52 (0.11) (0.52) (0.18) -- 10.36
1998 10.16 0.55 0.49 (0.55) -- -- 10.65
1997 10.06 0.56 0.10 (0.56) -- -- 10.16
1996 10.26 0.56 (0.20) (0.56) -- -- 10.06
Flex Shares
2000 $10.37 $ 0.52 $(0.78) $(0.52) $ -- $ -- $ 9.59
1999 10.66 0.47 (0.11) (0.47) (0.18) -- 10.37
1998 10.17 0.51 0.49 (0.51) -- -- 10.66
1997 10.07 0.51 0.10 (0.51) -- -- 10.17
1996 (3) 10.33 0.52 (0.26) (0.52) -- -- 10.07
* Annualized.
+ Returns are for the period indicated and have not been annualized. Total return figures do not reflect applicable sales loads.
(1) Commenced operations on June 1, 1995. All ratios for the period have been annualized.
(2) Commenced operations on June 6, 1995. All ratios for the period have been annualized.
(3) Commenced operations on June 7, 1995. All ratios for the period have been annualized.
(4) Commenced operations on April 1, 2000. All ratios for the period have been annualized.
</TABLE>
64
<PAGE>
<TABLE>
------------------------------------------------------------------------------------------------------------------------
RATIO OF
RATIO OF NET INVESTMENT
RATIO OF RATIO OF EXPENSES TO INCOME TO
NET ASSETS EXPENSES TO NET INVESTMENT AVERAGE NET ASSETS AVERAGE NET ASSETS PORTFOLIO
TOTAL END OF AVERAGE INCOME TO (EXCLUDING WAIVERS (EXCLUDING WAIVERS TURNOVER
RETURN(+) PERIOD(000 NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS) AND REIMBURSEMENTS) RATE
---------- ----------- ------------ ------------------ ------------------- ------------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
(0.48)% $ 93,040 0.67% 4.25% 0.78% 4.14% 88%
3.72 118,609 0.67 3.90 0.77 3.80 72
8.77 93,939 0.66 4.16 0.80 4.02 69
7.22 50,487 0.65 4.48 0.80 4.33 135
3.87 30,790 0.65 4.49 0.88 4.26 63
(0.68)% $ 2,875 0.87% 4.05% 1.36% 3.56% 88%
3.62 3,799 0.87 3.71 1.31 3.27 72
8.46 3,381 0.86 3.98 1.34 3.50 69
7.00 3,226 0.85 4.28 1.31 3.82 135
3.76 4,025 0.85 4.28 1.36 3.77 63
(1.17)% $ 9,791 1.37% 3.54% 1.89% 3.02% 88%
3.13 14,762 1.37 3.21 1.88 2.70 72
8.04 8,160 1.36 3.45 2.01 2.80 69
6.48 3,000 1.35 3.78 2.28 2.85 135
3.27 2,692 1.35 3.79 2.54 2.60 63
(0.90)% $ 81,160 0.67% 4.13% 0.77% 4.03% 19%
3.33 87,452 0.67 3.87 0.78 3.76 12
8.37 62,363 0.66 4.09 0.81 3.94 7
6.79 39,732 0.65 4.31 0.81 4.15 15
3.89 22,950 0.65 4.36 0.89 4.12 60
(1.26)% $ 2,458 0.87% 3.93% 1.40% 3.40% 19%
3.13 3,676 0.87 3.67 1.25 3.29 12
8.26 3,975 0.86 3.89 1.30 3.45 7
6.47 3,511 0.85 4.10 1.33 3.62 15
3.69 3,418 0.85 4.17 1.41 3.61 60
(1.59)% $ 8,827 1.37% 3.43% 1.95% 2.85% 19%
2.63 13,358 1.37 3.19 1.89 2.67 12
7.74 8,264 1.36 3.39 2.02 2.73 7
6.06 4,662 1.35 3.60 2.07 2.88 15
2.25 4,207 1.35 3.66 2.35 2.66 60
(0.13)% $ 3,075 1.40%* 6.57%* 2.83%* 5.14%* --%
(10.84) 2,032 1.73 8.94 2.95 7.72 24
5.64 7,230 1.91 5.09 2.22 4.78 95
8.18 24,413 1.87 5.27 1.87 5.27 130
3.91 32,506 1.65 5.49 1.70 5.44 123
7.67 36,891 1.70 5.87 1.75 5.82 138
(1.76)% $ 998,596 0.77% 6.05% 0.84% 5.98% 202%
4.25 1,149,068 0.77 5.25 0.85 5.17 221
10.92 793,488 0.76 5.67 0.86 5.57 109
6.99 633,646 0.75 5.89 0.85 5.79 298
4.02 599,514 0.75 5.81 0.87 5.69 184
(2.17)% $ 22,553 1.17% 5.60% 1.37% 5.40% 202%
3.86 34,913 1.17 4.87 1.36 4.68 221
10.49 33,269 1.14 5.29 1.38 5.05 109
6.66 33,165 1.15 5.48 1.41 5.22 298
3.50 36,155 1.15 5.40 1.44 5.11 184
(2.63)% $ 20,056 1.66% 5.14% 1.99% 4.81% 202%
3.35 26,020 1.66 4.40 2.00 4.06 221
9.99 13,111 1.65 4.76 2.11 4.30 109
6.16 5,763 1.64 5.00 2.20 4.44 298
2.50 4,621 1.64 4.84 2.49 3.99 184
(A) On March 27, 2000, the ESC Strategic Income Fund exchanged all of its asset
and certain liabilities for shares of the High Income Fund. The ESC Strategic
Income Fund is the accounting survivor in this transaction, and as a result, it
basis of accounting for assets and liabilities and its operating results for th
periods prior to March 27, 2000 have been carried forward in these financia
highlights. Subsequent to the merger, the High Income Fund changed its fisca
year end to May 31.
Amounts designated as "--" are either $0 or round to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS
</TABLE>
65
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, (UNLESS OTHERWISE
INDICATED) FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS
NET ASSET NET REALIZED AND DISTRIBUTIONS
VALUE NET UNREALIZED GAINS FROM NET DISTRIBUTIONS NET ASSET
BEGINNING INVESTMENT (LOSSES) INVESTMENT FROM REALIZED VALUE END
OF PERIOD INCOME ON INVESTMENTS INCOME CAPITAL GAINS OF PERIOD
----------- ----------- ---------------- ------------- ------------- ----------
Investment Grade Tax-Exempt Bond Fund
Trust Shares
<S> <C> <C> <C> <C> <C> <C> <C>
2000 $11.10 $ 0.43 $(0.29) $(0.43) $(0.14) $10.67
1999 11.40 0.43 0.10 (0.43) (0.40) 11.10
1998 11.22 0.44 0.50 (0.44) (0.32) 11.40
1997 11.10 0.44 0.33 (0.44) (0.21) 11.22
1996 11.28 0.45 0.19 (0.45) (0.37) 11.10
Investor Shares
2000 $11.12 $ 0.39 $(0.30) $(0.39) $(0.14) $10.68
1999 11.41 0.38 0.11 (0.38) (0.40) 11.12
1998 11.24 0.39 0.49 (0.39) (0.32) 11.41
1997 11.12 0.40 0.33 (0.40) (0.21) 11.24
1996 11.30 0.41 0.19 (0.41) (0.37) 11.12
Flex Shares
2000 $11.10 $ 0.34 $(0.29) $(0.34) $(0.14) $10.67
1999 11.40 0.33 0.10 (0.33) (0.40) 11.10
1998 11.23 0.33 0.49 (0.33) (0.32) 11.40
1997 11.11 0.35 0.33 (0.35) (0.21) 11.23
1996(1) 11.30 0.37 0.18 (0.37) (0.37) 11.11
Limited-Term Federal Mortgage Securities Fund
Trust Shares
2000 $ 9.94 $ 0.55 $(0.32) $(0.55) $ -- $ 9.62
1999 10.12 0.54 (0.06) (0.54) (0.12) 9.94
1998 10.02 0.58 0.11 (0.58) (0.01) 10.12
1997 9.99 0.58 0.04 (0.58) (0.01) 10.02
1996 10.11 0.62 (0.14) (0.60) -- 9.99
Investor Shares
2000 $ 9.93 $ 0.52 $(0.33) $(0.52) $ -- $ 9.60
1999 10.11 0.51 (0.06) (0.51) (0.12) 9.93
1998 10.00 0.56 0.12 (0.56) (0.01) 10.11
1997 9.97 0.56 0.04 (0.56) (0.01) 10.00
1996 10.11 0.60 (0.14) (0.60) -- 9.97
Flex Shares
2000 $ 9.94 $ 0.49 $(0.32) $(0.49) $ -- $ 9.62
1999 10.12 0.48 (0.06) (0.48) (0.12) 9.94
1998 10.02 0.52 0.11 (0.52) (0.01) 10.12
1997 9.99 0.52 0.04 (0.52) (0.01) 10.02
1996(2) 10.14 0.55 (0.15) (0.55) -- 9.99
Maryland Municipal Bond Fund (A)
Trust Shares
2000 $10.06 $ 0.42 $(0.60) $(0.42) $ -- $ 9.46
1999(3) 10.22 0.20 (0.15) (0.20) (0.01) 10.06
For the years ended November 30:
1998 9.95 0.42 0.27 (0.42) -- 10.22
1997 9.76 0.43 0.19 (0.43) -- 9.95
1996(4) 10.00 0.31 (0.24) (0.31) -- 9.76
Flex Shares
2000 $10.08 $ 0.33 $(0.60) $(0.33) $ -- $ 9.48
1999 10.24 0.15 (0.15) (0.15) (0.01) 10.08
For the years ended November 30:
1998 9.96 0.33 0.28 (0.33) -- 10.24
1997 9.76 0.34 0.20 (0.34) -- 9.96
1996(5) 9.53 0.20 0.23 (0.20) -- 9.76
Short-Term Bond Fund
Trust Shares
2000 $ 9.91 $ 0.53 $(0.25) $(0.53) $(0.01) $ 9.65
1999 10.05 0.51 (0.10) (0.52) (0.03) 9.91
1998 9.90 0.55 0.16 (0.55) (0.01) 10.05
1997 9.86 0.53 0.07 (0.53) (0.03) 9.90
1996 9.98 0.54 (0.10) (0.54) (0.02) 9.86
Investor Shares
2000 $ 9.93 $ 0.51 $(0.25) $(0.51) $(0.01) $ 9.67
1999 10.07 0.49 (0.10) (0.50) (0.03) 9.93
1998 9.91 0.53 0.17 (0.53) (0.01) 10.07
1997 9.88 0.51 0.06 (0.51) (0.03) 9.91
1996 10.01 0.52 (0.10) (0.53) (0.02) 9.88
Flex Shares
2000 $ 9.93 $ 0.48 $(0.25) $(0.48) $(0.01) $ 9.67
1999 10.07 0.47 (0.11) (0.47) (0.03) 9.93
1998 9.91 0.50 0.17 (0.50) (0.01) 10.07
1997 9.88 0.48 0.06 (0.48) (0.03) 9.91
1996(6) 10.02 0.47 (0.12) (0.47) (0.02) 9.88
+Returns are for the period indicated and have not been annualized. Total return figures do not reflect applicable sales loads.
(1)Commenced operations on June 1, 1995. All ratios for the period have been annualized.
(2)Commended operations on June 7, 1995. All ratios for the period have been annualized.
(3)For the six month period ended May 31, 1999. All ratios for the period have been annualized.
(4)Commenced operations on March 1, 1996. All ratios for the period have been annualized.
(5)Commenced operations on April 25, 1996. All ratios for the period have been annualized.
</TABLE>
66
<PAGE>
<TABLE>
-----------------------------------------------------------------------------------------------------------------------
RATIO OF
RATIO OF NET INVESTMENT
RATIO OF RATIO OF EXPENSES TO INCOME TO
NET ASSETS EXPENSES TO NET INVESTMENT AVERAGE NET ASSETS AVERAGE NET ASSETS PORTFOLIO
TOTAL END OF AVERAGE INCOME TO (EXCLUDING WAIVERS (EXCLUDING WAIVERS TURNOVER
RETURN(+) PERIOD(000 NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS) AND REIMBURSEMENTS) RATE
---------- ----------- ------------ ------------------ ------------------- ------------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1.41% $ 117,384 0.77% 3.98% 0.83% 3.92% 226%
4.67 154,123 0.77 3.75 0.87 3.65 224
8.57 146,606 0.76 3.83 0.88 3.71 378
7.13 139,144 0.75 3.96 0.86 3.85 489
5.82 124,507 0.75 4.01 0.89 3.87 514
0.90% $ 19,443 1.17% 3.59% 1.33% 3.43% 226%
4.35 25,195 1.17 3.36 1.32 3.21 224
8.05 28,159 1.16 3.43 1.43 3.16 378
6.69 31,857 1.15 3.56 1.38 3.33 489
5.40 37,427 1.15 3.61 1.42 3.34 514
0.52% $ 14,678 1.65% 3.11% 1.95% 2.81% 226%
3.78 16,518 1.65 2.86 2.03 2.48 224
7.50 8,399 1.64 2.95 2.10 2.49 378
6.19 4,681 1.63 3.08 2.15 2.56 489
4.91 5,536 1.63 3.12 2.25 2.50 514
2.33% $ 125,355 0.67% 5.60% 0.79% 5.48% 384%
4.75 135,256 0.67 5.28 0.77 5.18 379
7.12 137,488 0.66 5.75 0.77 5.64 163
6.43 123,903 0.65 5.81 0.78 5.68 133
4.84 73,370 0.65 6.04 0.84 5.85 83
1.93% $ 1,194 0.92% 5.31% 1.09% 5.14% 384%
4.47 2,214 0.92 5.03 1.52 4.43 379
6.95 2,705 0.91 5.50 1.51 4.90 163
6.17 2,426 0.90 5.55 1.48 4.97 133
4.59 2,512 0.90 5.75 2.25 4.40 83
1.71% $ 1,706 1.27% 4.97% 2.38% 3.86% 384%
4.14 2,119 1.27 4.69 2.42 3.54 379
6.49 1,543 1.26 5.16 2.72 3.70 163
5.80 1,409 1.25 5.20 2.66 3.79 133
4.10 1,349 1.25 5.38 3.59 3.04 83
(1.78)% $ 26,176 0.68% 4.24% 0.80% 4.12% 14%
0.48 29,658 0.70 3.83 1.37 3.16 19
7.03 19,115 0.62 4.11 1.15 3.58 12
6.50 11,461 0.63 4.38 1.16 3.85 5
1.07 5,808 0.71 4.30 1.36 3.65 9
(2.66)% $ 6,212 1.59% 3.34% 1.95% 2.98% 14%
0.05 7,723 1.59 2.94 1.98 2.55 19
6.17 3,246 1.57 3.16 1.96 2.77 12
5.64 561 1.54 3.43 2.00 2.97 5
7.67 113 1.55 3.42 2.20 2.77 9
2.87% $ 180,402 0.67% 5.40% 0.76% 5.31% 70%
4.06 209,904 0.67 5.12 0.77 5.02 108
7.31 120,422 0.66 5.47 0.79 5.34 87
6.30 89,701 0.65 5.37 0.78 5.24 118
4.45 91,156 0.65 5.39 0.81 5.23 163
2.67% $ 1,446 0.87% 5.20% 1.75% 4.32% 70%
3.88 1,825 0.87 4.92 1.59 4.20 108
7.19 1,949 0.86 5.27 1.71 4.42 87
5.97 2,182 0.85 5.16 1.58 4.43 118
4.23 2,700 0.85 5.20 1.72 4.33 163
2.31% $ 2,065 1.22% 4.85% 2.41% 3.66% 70%
3.50 2,341 1.22 4.55 2.33 3.44 108
6.84 2,110 1.21 4.93 2.85 3.29 87
5.62 1,073 1.20 4.82 3.02 3.00 118
3.73 966 1.20 4.77 4.06 1.91 163
(6) Commenced operations on June 20, 1995. All ratios for the period have been annualized.
(A) On May 24, 1999, the CrestFund Maryland Municipal Bond Fund exchanged all of
its assets and certain liabilities for shares of the Maryland Municipal Bond
Fund. The CrestFund Maryland Municipal Bond Fund is the accounting survivor in
this transaction, and as a result, its basis of accounting for assets and
liabilities and its operating results for the periods prior to May 24, 1999 have
been carried forward in these financial highlights.
Amounts designated as "--" are either $0 or have been rounded to $0.
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS
67
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, (UNLESS OTHERWISE
INDICATED) FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS
NET ASSET NET REALIZED AND DISTRIBUTIONS
VALUE NET UNREALIZED GAINS FROM NET DISTRIBUTIONS NET ASSET
BEGINNING INVESTMENT (LOSSES) INVESTMENT FROM REALIZED VALUE END
OF PERIOD INCOME ON INVESTMENTS INCOME CAPITAL GAINS OF PERIOD
------------- ----------- --------------- ------------- -------------- ----------
Short-Term U.S. Treasury Securities Fund
Trust Shares
<S> <C> <C> <C> <C> <C> <C> <C>
2000 $ 9.95 $ 0.46 $(0.10) $(0.46) $ -- $ 9.85
1999 9.97 0.47 (0.02) (0.47) -- 9.95
1998 9.88 0.51 0.10 (0.52) -- 9.97
1997 9.84 0.51 0.04 (0.51) -- 9.88
1996 9.93 0.55 (0.09) (0.55) -- 9.84
Investor Shares
2000 $ 9.95 $ 0.45 $(0.10) $(0.45) $ -- $ 9.85
1999 9.96 0.46 (0.01) (0.46) -- 9.95
1998 9.88 0.49 0.09 (0.50) -- 9.96
1997 9.84 0.50 0.04 (0.50) -- 9.88
1996 9.94 0.54 (0.10) (0.54) -- 9.84
Flex Shares
2000 $ 9.93 $ 0.42 $(0.10) $(0.42) $ -- $ 9.83
1999 9.94 0.44 (0.02) (0.43) -- 9.93
1998 9.85 0.47 0.10 (0.48) -- 9.94
1997 9.82 0.47 0.03 (0.47) -- 9.85
1996(1) 9.96 0.48 (0.14) (0.48) -- 9.82
U.S. Government Securities Fund
Trust Shares
2000 $10.28 $ 0.58 $(0.42) $(0.58) $ -- $ 9.86
1999 10.46 0.59 (0.18) (0.59) -- 10.28
1998 10.02 0.61 0.44 (0.61) -- 10.46
1997 9.91 0.62 0.11 (0.62) -- 10.02
1996 10.27 0.62 (0.33) (0.62) (0.03) 9.91
Investor Shares
2000 $10.28 $ 0.54 $(0.42) $(0.54) $ -- $ 9.86
1999 10.45 0.54 (0.17) (0.54) -- 10.28
1998 10.02 0.57 0.43 (0.57) -- 10.45
1997 9.90 0.58 0.12 (0.58) -- 10.02
1996 10.26 0.59 (0.33) (0.59) (0.03) 9.90
Flex Shares
2000 $10.28 $ 0.49 $(0.42) $(0.49) $ -- $ 9.86
1999 10.46 0.49 (0.18) (0.49) -- 10.28
1998 10.02 0.52 0.44 (0.52) -- 10.46
1997 9.91 0.53 0.11 (0.53) -- 10.02
1996(2) 10.31 0.52 (0.37) (0.52) (0.03) 9.91
Virginia Intermediate Municipal Bond Fund (A)
Trust Shares
2000 $10.20 $ 0.43 $(0.57) $(0.43) $(0.05) $ 9.58
1999(3) 10.44 0.21 (0.17) (0.21) (0.07) 10.20
For years ended November 30:
1998 10.31 0.45 0.17 (0.45) (0.04) 10.44
1997 10.22 0.46 0.09 (0.46) -- 10.31
1996 10.24 0.42 (0.02) (0.42) -- 10.22
1995 9.21 0.43 1.03 (0.43) -- 10.24
Investor Shares
2000 $10.20 $ 0.42 $(0.56) $(0.42) $(0.05) $ 9.59
1999(3) 10.45 0.22 (0.18) (0.22) (0.07) 10.20
For years ended November 30:
1998 10.31 0.46 0.17 (0.45) (0.04) 10.45
1997 10.21 0.47 0.09 (0.46) -- 10.31
1996 10.23 0.42 (0.02) (0.42) -- 10.21
1995 9.20 0.43 1.03 (0.43) -- 10.23
Virginia Municipal Bond Fund (A)
Trust Shares
2000 $10.43 $ 0.45 $(0.78) $(0.45) $(0.01) $ 9.64
1999(3) 10.68 0.22 (0.19) (0.22) (0.06) 10.43
For years ended November 30:
1998 10.44 0.47 0.27 (0.47) (0.03) 10.68
1997 10.28 0.48 0.17 (0.48) (0.01) 10.44
1996 10.40 0.47 (0.12) (0.47) -- 10.28
1995(4) 10.00 0.31 0.44 (0.31) (0.04) 10.40
Flex Shares
2000 $10.48 $ 0.36 $(0.79) $(0.36) $(0.01) $ 9.68
1999(3) 10.73 0.17 (0.18) (0.18) (0.06) 10.48
For years ended November 30:
1998 10.48 0.37 0.28 (0.37) (0.03) 10.73
1997 10.31 0.39 0.18 (0.39) (0.01) 10.48
1996 10.43 0.38 (0.12) (0.38) -- 10.31
1995(5) 10.06 0.24 0.41 (0.24) (0.04) 10.43
+ Returns are for the period indicated and have not been annualized. Total
return figures do not reflect applicable sales loads.
(1) Commenced operations on June 22, 1995. All ratios for the period have been
annualized.
(2) Commenced operations on June 7, 1995. All ratios for the period have been annualized.
(3) For the six month period ended May 31, 1999. All ratios for the period have been annualized.
(4) Commenced operations on April 5, 1995. All ratios for the period have been annualized.
(5) Commenced operations on April 17, 1995. All ratios for the period have been annualized.
68
<PAGE>
-----------------------------------------------------------------------------------------------------------------------------------
RATIO OF
RATIO OF NET INVESTMENT
RATIO OF RATIO OF EXPENSES TO INCOME TO
NET ASSETS EXPENSES TO NET INVESTMENT AVERAGE NET ASSETS AVERAGE NET ASSETS PORTFOLIO
TOTAL END OF AVERAGE INCOME TO (EXCLUDING WAIVERS (EXCLUDING WAIVERS TURNOVER
RETURN(+) PERIOD(000 NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS) AND REIMBURSEMENTS) RATE
---------- ---------- ----------- ------------------ --------------------- ------------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
3.75% $ 72,570 0.67% 4.70% 0.79% 4.58% 50%
4.59 56,027 0.67 4.69 0.78 4.58 57
6.30 46,920 0.66 5.19 0.84 5.01 39
5.76 21,988 0.65 5.23 0.92 4.96 93
4.73 10,149 0.65 5.56 1.00 5.21 94
3.58%$ 2,066 0.82% 4.50% 1.44% 3.88% 50%
4.54 2,799 0.82 4.54 1.34 4.02 57
6.04 3,277 0.81 5.07 1.33 4.55 39
5.59 3,921 0.80 5.05 1.35 4.50 93
4.52 4,192 0.80 5.43 1.32 4.91 94
3.34%$ 5,391 1.07% 4.26% 2.04% 3.29% 50%
4.32 4,931 1.07 4.22 2.25 3.04 57
5.90 1,413 1.06 4.81 2.87 3.00 39
5.19 1,091 1.05 4.75 2.51 3.29 93
3.72 2,423 1.05 5.03 2.97 3.11 94
1.63%$ 85,420 0.77% 5.77% 0.84% 5.70% 29%
3.90 102,167 0.77 5.58 0.88 5.47 19
10.76 34,899 0.76 5.93 0.92 5.77 14
7.54 19,471 0.75 6.19 1.02 5.92 21
2.77 10,277 0.75 6.05 1.25 5.55 83
1.19%$ 1,407 1.17% 5.34% 2.14% 4.37% 29%
3.56 2,534 1.17 5.17 1.60 4.74 19
10.23 3,225 1.16 5.53 1.76 4.93 14
7.21 2,243 1.15 5.76 1.79 5.12 21
2.47 2,396 1.15 5.68 2.50 4.33 83
0.70%$ 7,750 1.68% 4.85% 2.28% 4.25% 29%
2.99 11,520 1.68 4.66 2.08 4.26 19
9.78 4,022 1.67 5.02 2.32 4.37 14
6.57 2,801 1.66 5.26 2.42 4.50 21
1.42 2,826 1.66 5.18 2.86 3.98 83
(1.31)%$202,209 0.76% 4.35% 0.76% 4.35% 18%
0.42 240,083 0.84 4.12 1.18 3.78 19
6.10 243,606 0.79 4.33 0.97 4.15 24
5.55 237,096 0.78 4.57 0.93 4.42 30
4.01 243,137 0.78 4.35 0.93 4.20 25
16.09 43,373 0.72 4.34 0.94 4.12 28
(1.24)%$ 6,808 0.79% 4.33% 0.94% 4.18% 18%
0.35 7,706 0.79 4.17 0.93 4.03 19
6.19 7,899 0.79 4.33 0.94 4.18 24
5.65 7,826 0.79 4.56 0.94 4.41 30
4.01 8,185 0.79 4.12 0.94 3.97 25
16.10 8,649 0.73 4.33 0.95 4.11 28
(3.18)%$ 48,980 0.74% 4.53% 0.79% 4.48% 19%
0.27 31,939 0.76 4.20 1.30 3.66 7
7.19 29,252 0.69 4.41 1.10 4.00 28
6.46 20,044 0.69 4.65 1.09 4.25 39
3.48 15,911 0.71 4.61 1.11 4.21 24
7.67 6,247 0.71 4.61 1.11 4.21 35
(4.13)%$ 5,367 1.65% 3.61% 2.08% 3.18% 19%
(0.16) 6,939 1.65 3.32 1.91 3.06 7
6.24 3,697 1.64 3.46 1.92 3.18 28
5.58 1,476 1.60 3.73 2.00 3.33 39
2.58 787 1.57 3.73 1.97 3.33 24
6.51 628 1.57 3.76 1.97 3.36 35
(A) On May 24, 1999, the CrestFund Virginia Intermediate Municipal Bond and the
CrestFund Virginia Municipal Bond Funds exchanged all of their assets and
certain liabilities for shares of the Virginia Intermediate Municipal Bond and
the Virginia Municipal Bond Funds, respectively. The CrestFund Virginia
Intermediate Municipal Bond and the CrestFund Virginia Municipal Bond Funds are
the accounting survivors in this transaction, and as a result, their basis of
accounting for assets and liabilities and their operating results for the
periods prior to May 24, 1999 have been carried forward in these financial
highlights.
Amounts designated as "--" are either $0 or have been rounded to $0.
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS
69
<PAGE>
NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
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 thirty-five funds as of May 31, 2000: the
Balanced Fund, the Capital Appreciation Fund (formerly Capital Growth Fund), the
Core Equity Fund, the E-Commerce Opportunity Fund, the Growth and Income Fund,
the International Equity Fund, the International Equity Index Fund, the Life
Vision Moderate Growth Fund (formerly Life Vision Balanced Portfolio), the Life
Vision Growth and Income Fund (formerly Life Vision Growth and Income
Portfolio), the Life Vision Aggressive Growth Fund (formerly Life Vision Maximum
Growth Portfolio), the Mid-Cap Equity Fund, the Small Cap Value Equity Fund, the
Small Cap Growth Stock Fund, the Tax Sensitive Growth Stock Fund, the Value
Income Stock Fund, (collectively the "Equity Funds"), the Florida Tax-Exempt
Bond Fund, the Georgia Tax-Exempt Bond Fund, the High Income Fund, the
Investment Grade Bond Fund, the Investment Grade Tax-Exempt Bond Fund, the
Limited-Term Federal Mortgage Securities Fund, the Maryland Municipal Bond Fund,
the Short-Term Bond Fund, the Short-Term U.S. Treasury Securities Fund, the U.S.
Government Securities Fund, the Virginia Intermediate Municipal Bond Fund, and
the Virginia Municipal Bond Fund, (collectively the "Fixed Income Funds" or the
"Funds"), the Prime Quality Money Market Fund, the Tax-Exempt Money Market Fund,
the Tax-Free Money Market Fund, the U.S. Government Securities Money Market
Fund, the U.S. Treasury Money Market Fund (collectively the "Retail Money Market
Funds"), the Classic Institutional Cash Management Money Market Fund, the
Classic Institutional U.S. Government Securities Money Market Fund and the
Classic Institutional U.S. Treasury Securities Money Market Fund, (collectively
the "Institutional Money Market Funds"). The assets of each Fund 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 financial statements presented herein
are those of the Fixed Income Funds. The financial statements of the Equity
Funds, the Retail Money Market Funds and the Institutional Money Market Funds
are not presented herein, but are presented separately. During February 1999,
the Board of Trustees of the STI Classic Funds Inc. and Board of Directors of
the CrestFunds Inc. ("CrestFunds") approved an Agreement and Plan of
Reorganization (the "Reorganization Agreement") providing for the transfer of
all assets and certain stated liabilities of the CrestFunds in exchange for the
issuance of shares in the Funds in a tax-free reorganization (see Note 9).
On February 15, 2000 and December 9, 1999, respectively, theBoard ofTrustees of
the STIClassic Funds Inc. and Board of Directors of the ESCStrategic Funds Inc.
approved an Agreement and Plan of Reorganization (the "Reorganization
Agreement") providing for the transfer of all assets and liabilities of the
ESCStrategic Income Fund in exchange for the issuance of shares in the
STIClassic High Income Fund in a tax-free reorganization that took place at the
close of business on March 27, 2000. The STI Classic High Income Fund had not
commenced operations prior to this merger.
Subsequent to March, 31, 2000, the High Income Fund's fiscal year end was
changed to May 31, in order to be consistent with the year end of each of the
other STI Classic Funds.
2. Significant Accounting Policies:
The following is a summary of significant accounting policies followed by the
Trust:
BASIS OF PRESENTATION OF STATEMENTS -- As more fully described in Note 9,
the STI Classic Funds acquired certain CrestFunds in a tax-free business
combination. While each Fund now exists as a STI Classic Fund, three of the
surviving funds for accounting purposes are CrestFunds. In accordance with
generally accepted accounting principles, the financial statements
presented herein represent those of accounting survivors. Accordingly, the
Statements of Changes in Net Assets and Financial Highlights presented for
periods prior to and ending on May 31, 1999 reflect activity beginning on
the first day of the accounting survivor's fiscal year.
As more fully described above, the STI Classic High Income Fund acquired
the ESCStrategic Income Fund in a tax-free business combination. While this
Fund now exists as a STIClassic Fund, the surviving fund for accounting
purposes is the ESCStrategic Income Fund. In accordance with generally
accepted accounting principles, the financial statements presented herein
represent those of the accounting survivor. Accordingly, the Statements of
Changes in Net Assets and Financial Highlights presented for the periods
prior to and ending on May 31, 2000 reflect activity beginning on the first
day of the accounting survivor's fiscal year.
SECURITY VALUATION -- Investment securities held by the 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. Debt obligations with sixty days
70
<PAGE>
-------------------------------------------------------------------------------
or less remaining until maturity may be valued at their amortized cost.
Securities for which current market quotations are not readily available
are valued at their fair value as determined in good faith by, or in
accordance with procedures adopted by, the Board of Trustees.
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 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 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. The maximum
offering price per share for Investor shares of the Florida Tax-Exempt
Bond, the Georgia Tax-Exempt Bond, the Investment Grade Bond, the
Investment Grade Tax-Exempt Bond, the U.S. Government Securities, and the
Virginia Intermediate Municipal Bond 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% for either the net
asset value of the shares at the time of purchase or the net asset value of
the shares next calculated after the Fund receives the sale request,
whichever is less. The CDSC will not apply to shares redeemed after such
time.
TBA PURCHASE COMMITMENTS -- The Funds may enter into "TBA" (To Be
Announced) purchase commitments to purchase securities for a fixed price at
a future date beyond customary settlement time. TBA purchase commitments
may be considered securities in themselves, and involve a risk of loss if
the value of the security to be purchased declines prior to settlement
date, which risk is in addition to the risk of decline in the value of the
funds' other assets. Unsettled TBA purchase commitments are valued at the
current market value of the underlying securities, generally according to
the procedures described under "Security Valuation."
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 TO SHAREHOLDERS -- Distributions from net investment income
for each of the Fixed Income Funds are declared daily and paid monthly. 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 the classification of short-term capital
71
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
-------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
gains and ordinary income for tax purposes related to the other funds, has
been reclassified to/from the following accounts:
ACCUMULATED UNDISTRIBUTED
PAID-IN REALIZED NET INVESTMENT
CAPITAL GAIN (LOSS) INCOME (LOSS)
(000) (000) (000)
------- ----------- ---------------
Georgia Tax-Exempt Bond Fund $-- $ 1 $(1)
Investment Grade Tax-Exempt
Bond Fund 8 (6) (2)
Maryland Municipal Bond Fund (3) -- 3
Short-Term Bond Fund -- 2 (2)
Short-Term U.S. Treasury
Securities Fund -- (32) 32
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. Transactions with Affiliates:
Certain officers of the Trust are also officers of SEI Investments Mutual Funds
Services (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.
The Fund has entered into an agreement with the Distributor to manage the
investments of repurchase agreements for the Funds. For its services the
Distributor received $1,846,277 for the year ended May 31, 2000.
4. Administration, Transfer Agency Servicing and Distribution Agreements:
The Trust and the Administrator are parties to an Administration Agreement dated
May 29, 1995, as amended November 19, 1997 and March 1, 1999, 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 Trust) of: .12% up to $1 billion, .09% on the next $4 billion, .07% on
the next $3 billion, .065% on the next $2 billion and .06% for over $10 billion.
Prior to May 1999, administrative and accounting services were provided to the
CrestFunds by SEI Investments Mutual Funds Services who was entitled to receive
a fee at an annual rate of .15% of the average daily net assets of the
CrestFunds. The Administrator had voluntarily agreed to waive a portion of its
fee for Government Bond Fund and Virginia Municipal Bond Fund in order
to limit operating expenses.
Prior to March 27, 2000, administrative and accounting services were provided to
the ESC Strategic Income Fund by BISYS Fund Services Limited Partnership who was
entitled to receive a fee at an annual rate of .15% of the average daily net
assets of the ESC Strategic Income Fund.
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.
Prior to March 27, 2000, transfer and dividend disbursing agent services were
provided to the ESC Strategic Income Fund by BISYS Fund Services Inc. for which
it received a fee of $15 per account per year subject to a minimum fee of
$15,000.
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".
Prior to May 1999, the Distributor, a wholly owned subsidiary of SEI Investments
Co., served as distributor of each of the CrestFunds shares pursuant to an
agreement with the CrestFunds. The Trust Class and Investors Class A shares of
the CrestFunds had a separate distribution plan (the 12b-1 Plan) pursuant to
Rule 12b-1 under the 1940 Act. As provided in the 12b-1 Plan, the Trust Class
and Investors Class A shares of the CrestFunds paid the Distributor as
compensation for its services .15% of the aggregate average daily net assets of
such classes of the CrestFunds. The Distributor had voluntarily agreed to waive
any fees payable pursuant to the 12b-1 Plan. Additionally, the Investors Class B
Shares of the CrestFunds had a distribution plan (the B Shares Plan) pursuant to
Rule 12b-1 under the 1940 Act. As provided in the B Shares Plan, the Investors
Class B Shares of the CrestFunds paid the Distributor as compensation for its
services .75% of the aggregate average daily net assets of such class of the
CrestFunds. In addition, pursuant to the B Shares Plan, the Distributor was
compensated at an annual rate of .25% of the B shares' average net assets for
providing ongoing shareholder support services to investors in B shares. The
Distributor had agreed to waive the portion of its fees pursuant to the B Shares
Plan in order to limit distribution fees to .95% for each of the CrestFunds.
72
<PAGE>
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Prior to May 1999, the CrestFunds had adopted a shareholder service plan (the
"Plan") for Trust Class Shares of the Limited Term Bond Fund, Intermediate Bond
Fund, Government Bond Fund, Maryland Municipal Bond Fund, Virginia Intermediate
Municipal Bond Fund and Virginia Municipal Bond Fund. Under the Plan, the
CrestFunds paid the Distributor a negotiated fee at a rate of up to .25%
annually of the average daily net assets of such Fund attributable to the shares
that are subject to the arrangement in return for provision of a broad range of
shareholder and administrative services. The Distributor had agreed to waive a
portion of its shareholder service plan for trust class shares in order to limit
shareholder service fees to .05%.
Prior to March 27, 2000, BISYS Fund Services served as distributor pursuant to
an agreement with the ESC Strategic Income Fund.
5. Investment Advisory and Custodian Agreements:
The Trust, Trusco Capital Management ("Trusco") and the SunTrust Bank, Atlanta
have entered into advisory agreements dated May 29, 1992, June 15, 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:
Florida Tax-Exempt
Bond Fund .65% .67% .18% .87% 1.00% 1.37%
Georgia Tax-Exempt
Bond Fund .65% .67% .18% .87% 1.00% 1.37%
HighIncome Fund .80% -- -- -- 1.00% 1.40%
Investment
Grade Bond Fund .74% .77% .43% 1.17% 1.00% 1.66%
Investment
Grade Tax-Exempt
Bond Fund .74% .77% .43% 1.17% 1.00% 1.65%
Limited-Term
Federal Mortgage
Securities Fund .65% .67% .23% .92% 1.00% 1.27%
Maryland
Municipal Bond
Fund .65% .68% -- -- 1.00% 1.59%
Short-Term Bond
Fund .65% .67% .23% .87% 1.00% 1.22%
Short-Term U.S.
Treasury
Securities Fund .65% .67% .18% .82% 1.00% 1.07%
U.S. Government
Securities Fund .74% .77% .38% 1.17% 1.00% 1.68%
Virginia
Intermediate
Municipal
Bond Fund .65% .76% .15% .79% -- --
Virginia Municipal
Bond Fund .65% .74% -- -- 1.00% 1.65%
The investment advisers 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.
Prior to May 1999, Crestar Asset Management Company ("CAMCO") provided
Investment Advisory services to the CrestFunds. CAMCO was paid for advisory
services at an annual rate of .50% of average daily net assets for the Limited
Term Bond Fund and Virginia Intermediate Municipal Bond Fund, and .60% of
average daily net assets for the Intermediate Bond Fund, Government Bond Fund,
Maryland Municipal Bond Fund and Virginia Municipal Bond Fund.
Prior to March 27, 2000 SunTrust Equitable Securities Corporation ("STES")
provided investment advisory services to the ESC Strategic Income Fund. STES was
paid for advisory services at an annual rate of 1.00% of average daily net
assets of the Fund, and agreed to waive and reimburse their fee in order to
limit operating expenses to a maximum of 2.00% of average daily net assets of
the Class A shares, and 2.50% of the Class D shares.
SunTrust Bank, Atlanta, an affiliate of the investment adviser, acts as
custodian for all of the funds. Fees of the Custodian are paid on the basis of
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.
73
<PAGE>
<TABLE>
NOTES TO FINANCIAL STATEMENTS (continued)
-----------------------------------------------------------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
6. Capital Share Transactions:
Capital Share Transactions for the funds were as follows: (000)
FLORIDA TAX-EXEMPT GEORGIA TAX-EXEMPT
BOND FUND BOND FUND HIGH INCOME FUND
-------------------- ------------------------ -------------------------------
06/01/99- 06/01/98- 06/01/99- 06/01/98- 04/01/00- 04/01/99 04/01/98-
05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 03/31/00 03/31/99
-------- ---------- ----------- --------- --------- -------- ---------
Trust Shares:
<S> <C> <C> <C> <C> <C> <C> <C>
Shares Issued 2,797 4,807 2,757 3,562 -- -- --
Shares Issued in Connection with Crestar Merger -- -- -- -- -- --
Shares Issued in Lieu of Cash Distributions 87 154 140 116 -- -- --
Shares Redeemed (4,835) (2,530) (3,069) (1,128) -- -- --
------ ----- ----- ----- --- ---- ------
Net Trust Share Transactions (1,951) 2,431 (172) 2,550 -- -- --
------ ----- ----- ----- --- ---- ------
Investor Shares:
Shares Issued 16 102 58 117 -- -- --
Shares Issued in Connection with Crestar Merger -- -- -- -- -- --
Shares Issued in Lieu of Cash Distributions 12 13 11 12 -- -- --
Shares Redeemed (101) (72) (177) (155) -- -- --
------ ----- ----- ----- --- ---- ------
Net Investor Share Transactions (73) 43 (108) (26) -- -- --
------ ----- ----- ----- --- ---- ------
Flex Shares:
Shares Issued 287 1,102 196 586 147 99 94
Shares Issued in Connection with ESC Merger -- -- -- -- -- 44 --
Shares Issued in Lieu of Cash Distributions 42 40 42 30 2 50 90
Shares Redeemed (748) (512) (641) (102) (14) (678) (1,888)
------ ----- ----- ----- --- ---- ------
Net Flex Share Transactions (419) 630 (403) 514 135 (485) (1,704)
------ ----- ----- ----- --- ---- ------
Class D:
Shares Issued -- -- -- -- -- 5 16
Shares Issued in Connection with Merger -- -- -- -- -- (44) --
Shares Issued in Lieu of Cash Distributions -- -- -- -- -- 4 4
Shares Redeemed -- -- -- -- -- (21) (46)
------ ----- ----- ----- --- ---- ------
Net Class D Transactions -- -- -- -- -- (56) (26)
------ ----- ----- ----- --- ---- ------
Net Change in Capital Shares (2,443) 3,104 (683) 3,038 135 (541) (1,730)
====== ===== ==== ===== === ==== ======
SHORT-TERM SHORT-TERM U.S. TREASURY
BOND FUND SECURITIES FUND
---------------------------- -------------------------
06/01/99- 06/01/98- 06/01/99- 06/01/98-
05/31/00 05/31/99 05/31/00 05/31/99
---------- --------- --------- ---------
Trust Shares:
Shares Issued 5,302 5,746 3,158 1,750
Shares Issued in Connection with Crestar Merger -- 7,308 -- --
Shares Issued in Lieu of Cash Distributions 478 357 145 95
Shares Redeemed (8,249) (4,219) (1,567) (921)
------ ------ ------ -----
Net Trust Share Transactions (2,469) 9,192 1,736 924
------ ------ ------ -----
Investor Shares:
Shares Issued 41 58 75 138
Shares Issued in Lieu of Cash Distributions 9 9 13 13
Shares Redeemed (84) (77) (159) (198)
------ ------ ------ -----
Net Investor Share Transactions (34) (10) (71) (47)
------ ------ ------ -----
Flex Shares:
Shares Issued 119 251 341 531
Shares Issued in Connection with Crestar Merger -- -- -- --
Shares Issued in Lieu of Cash Distributions 11 10 22 9
Shares Redeemed (152) (235) (311) (185)
------ ------ ------ -----
Net Flex Share Transactions (22) 26 52 355
------ ------ ------ -----
Net Change in Capital Shares (2,525) 9,208 1,717 1,232
====== ====== ====== =====
</TABLE>
74
<PAGE>
<TABLE>
-----------------------------------------------------------------------------------------------------------------------------------
INVESTMENT GRADE INVESTMENT GRADE TAX- LIMITED-TERM FEDERAL MARYLAND MUNICIPAL
BOND FUND EXEMPT BOND FUND MORTGAGE SECURITIES FUND BOND FUND
-------------------- ----------------------- ------------------------ ------------------------------
06/01/99- 06/01/98- 06/01/99- 06/01/98- 06/01/99- 06/01/98- 06/01/99- 12/01/98- 12/01/97
05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 05/31/99 11/30/98
--------- --------- --------- ---------- --------- --------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
25,331 28,937 2,710 5,150 5,423 5,379 1,921 1,556 1,292
-- 30,233 -- -- -- -- -- -- --
3,675 3,979 254 479 492 620 21 2 1
(35,746) (26,711) (5,846) (4,614) (6,485) (5,979) (2,122) (479) (575
------- ------- ------ ------ ------ ------ ------ ------ ------
(6,740) 36,438 (2,882) 1,015 (570) 20 (180) 1,079 718
------- ------- ------ ------ ------ ------ ------ ------ ------
331 758 63 190 31 84 -- -- --
-- 229 -- -- -- -- -- -- --
167 191 91 143 10 15 -- -- --
(1,516) (931) (600) (535) (140) (144) -- -- --
------- ------- ------ ------ ------ ------ ------ ------ ------
(1,018) 247 (446) (202) (99) (45) -- -- --
------- ------- ------ ------ ------ ------ ------ ------ ------
958 1,821 650 936 81 107 237 464 274
-- -- -- -- -- -- -- --
123 93 62 49 10 10 23 7 4
(1,500) (634) (825) (234) (127) (56) (370) (22) (17)
------- ------- ------ ------ ------ ------ ------ ------ ------
(419) 1,280 (113) 751 (36) 61 (110) 449 261
------- ------- ------ ------ ------ ------ ------ ------ ------
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
------- ------- ------ ------ ------ ------ ------ ------ ------
-- -- -- -- -- -- -- -- --
------- ------- ------ ------ ------ ------ ------ ------ ------
(8,177) 37,965 (3,441) 1,564 (705) 36 (290) 1,528 979
======= ======= ====== ====== ====== ====== ====== ====== ======
U. S. GOVERNMENT
SECURITIES FUND VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND VIRGINIA MUNICIPAL BOND FUND
--------------------- -------------------------------------------- -----------------------------
06/01/99- 06/01/98- 06/01/99- 12/01/98- 12/01/97- 06/01/99- 12/01/98- 12/01/97-
05/31/00 05/31/99 05/31/00 05/31/99 11/30/98 05/31/00 05/31/99 11/30/98
--------- ---------- ---------- --------- ---------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
2,790 2,197 2,693 2,543 3,557 3,311 688 1,302
-- 5,439 -- -- -- -- -- --
127 49 98 4 61 26 3 6
(4,192) (1,087) (5,235) (2,327) (3,293) (1,318) (368) (488)
------ ------ ------ ------ ------ ------ ---- -----
(1,275) 6,598 (2,444) 220 325 2,019 323 820
------ ------ ------ ------ ------ ------ ---- -----
41 91 147 62 210 -- -- --
11 15 29 16 28 -- -- --
(156) (167) (221) (79) (241) -- -- --
------ ------ ------ ------ ------ ------ ---- -----
(104) (61) (45) (1) (3) -- -- --
------ ------ ------ ------ ------ ------ ---- -----
238 564 -- -- -- 161 359 233
-- 308 -- -- -- -- -- --
44 19 -- -- -- 15 7 6
(616) (156) -- -- -- (284) (49) (35)
------ ------ ------ ------ ------ ------ ---- -----
(334) 735 -- -- -- (108) 317 204
------ ------ ------ ------ ------ ------ ---- -----
(1,713) 7,272 (2,489) 219 322 1,911 640 1,024
====== ===== ====== ====== ====== ====== ==== =====
</TABLE>
75
<PAGE>
NOTES TO FINANCIAL STATEMENTS (concluded)
-------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
7. 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, 2000, were as follows:
PURCHASES SALES
(000) (000)
--------------------
Florida Tax-Exempt Bond Fund $ 98,307 $124,813
Georgia Tax-Exempt Bond Fund 17,157 23,587
High Income Fund 944 --
Investment Grade Bond Fund 1,048,744 931,682
Investment Grade Tax-Exempt Bond Fund 340,143 375,260
Limited-Term Federal Mortgage
Securities Fund -- --
Maryland Municipal Bond Fund 9,607 3,570
Short-Term Bond Fund 92,425 58,221
Short-Term U.S. Treasury Securities Fund -- --
U.S. Government Securities Fund -- 29
Virginia Intermediate Municipal Bond Fund 38,212 76,328
Virginia Municipal Bond Fund 24,485 9,157
The cost of purchases and proceeds from sales of U.S. Government securities
were:
PURCHASES SALES
(000) (000)
--------------------
Florida Tax-Exempt Bond Fund $ -- $ --
Georgia Tax-Exempt Bond Fund -- --
High Income Fund -- --
Investment Grade Bond Fund 1,143,261 1,417,469
Investment Grade Tax-Exempt Bond Fund -- --
Limited-Term Federal Mortgage
Securities Fund 507,100 531,796
Maryland Municipal Bond Fund -- --
Short-Term Bond Fund 35,838 84,195
Short-Term U.S. Treasury Securities Fund 32,856 23,767
U.S. Government Securities Fund 29,378 41,373
Virginia Intermediate Municipal Bond Fund -- --
Virginia Municipal Bond Fund -- --
At May 31, 2000, 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, 2000, were as follows:
AGGREGATE AGGREGATE NET
GROSS GROSS UNREALIZED
UNREALIZED UNREALIZED APPRECIATION/
APPRECIATION DEPRECIATION (DEPRECIATION)
(000) (000) (000)
------------------------- --------------
Florida Tax-Exempt Bond Fund $ 257 $(2,723) $ (2,466)
Georgia Tax-Exempt Bond Fund 93 (3,335) (3,242)
High Income Fund -- (162) (162)
Investment Grade Bond Fund 5,160 (62,099) (56,939)
Investment Grade Tax-Exempt
Bond Fund 602 (1,468) (866)
Limited-Term Federal Mortgage
Securities Fund 31 (2,637) (2,606)
Maryland Municipal Bond Fund 40 (1,776) (1,736)
Short-Term Bond Fund 24 (4,793) (4,769)
Short-Term U.S. Treasury
Securities Fund 9 (837) (828)
U.S. Government Securities Fund 104 (4,045) (3,941)
Virginia Intermediate Municipal
Bond Fund 1,289 (7,671) (6,382)
Virginia Municipal Bond Fund 108 (2,359) (2,251)
Subsequent to October 31, 1999, the Funds recognized net capital losses for tax
purposes that have been deferred to 2000 and can be used to offset future
capital gains after May 31, 2000. The Funds also had capital loss carryforwards
at May 31, 2000 as follows:
<TABLE>
POST
10/31
CARRYOVER EXPIRES EXPIRES EXPIRES EXPIRES EXPIRES EXPIRES EXPIRES DEFERRED
5/31/00 2002 2003 2004 2005 2006 2007 2008 LOSS
(000) (000) (000 (000) (000) (000 (000) (000) (000)
-------- -------- ------- -------- ------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Florida
Tax-Exempt
Bond
Fund $ 1,224 $ -- $ -- $ -- $ -- $ -- $ -- $ 1,224 $1,039
Georgia
Tax-Exempt
Bond
Fund 398 -- -- -- -- -- -- 398 438
High Income
Fund 768 -- -- -- -- -- 61 707 --
Investment
Grade Bond
Fund 14,208 -- -- -- -- 3,029 -- 11,179 27,768
Investment
Grade
Tax-Exempt
Bond
Fund 2,622 -- -- -- -- -- -- 2,622 2,053
Limited-Term
Federal
Mortgage
Securities
Fund 2,189 -- -- -- -- -- -- 2,189 1,288
Maryland
Municipal
Bond
Fund 22 -- -- -- -- -- 19 3 233
Short-Term
Bond Fund 3,701 528 254 555 284 1,134 -- 946 1,178
Short-Term
U.S. Treasury
Securities
Fund -- -- -- -- -- -- -- -- 15
U.S. Government
Securities
Fund 1,636 -- -- -- -- 792 -- 844 911
Virginia
Intermediate
Municipal
Bond
Fund -- -- -- -- -- -- -- -- 2,062
Virginia
Municipal
Bond
Fund 53 -- -- -- -- -- -- 53 490
</TABLE>
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.
8. Concentration of Credit Risk:
The Investment Grade Bond Fund and the Short-Term Bond 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 investment adviser 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.
76
<PAGE>
-------------------------------------------------------------------------------
Treasury with a maximum remaining maturity of 3 years or less. The Florida
Tax-Exempt Bond Fund, the Georgia Tax-Exempt Bond Fund, the Maryland Municipal
Bond Fund, the Virginia Intermediate Municipal Bond Fund, and the Virginia
Municipal 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.
The High Income Fund that invests in high yield instruments is subject to
certain credit and market risks. The yields of high debt obligations reflect,
among other things, perceived credit risk. The Funds' investment in securities
rated below investment grade typically involves risks not associated with higher
rated securities including, among others, greater risks of timely and ultimate
payment of interest and principal, greater market price volatility and less
liquid secondary marketing trading.
9. CrestFunds Merger
The Board of Directors and shareholders of the CrestFunds approved a
reorganization of the CrestFunds into STI Classic Funds which took place during
May 1999.
The following table summarizes certain relevant information of the Funds prior
to and immediately after the business combinations in May 1999 and is unaudited:
OUTSTANDING UNREALIZED
ON MERGER APPRECIATION
CRESTFUNDS DATE (DEPRECIATION)
------------------------------------ ---------- ------------
Intermediate Bond
Trust Shares 32,817,534$ (3,403,150)
Investor Class A 248,950 (67,865)
Investor Class B -- --
Limited Term Bond
Trust Shares 7,494,047 31,650
Investor Class A -- --
Investor Class B -- --
Government Bond
Trust Shares 5,608,897 (698,071)
Investor Class A -- --
Investor Class B 315,993 61,930
Maryland Municipal Bond (1)
Trust Shares 2,941,190 305,068
Investor Class B 764,740 (31,446)
Virginia Intermediate Municipal
Bond (1)
Trust Shares 23,538,137 5,880,351
Investor Class A 753,539 76,972
Virginia Municipal Bond (1)
Trust Shares 3,019,996 511,586
Investor Class B 647,089 (13,152)
<PAGE>
SHARES ISSUED NET ASSETS NAV
IN BUSINESS AFTER PER
STI CLASSIC FUNDS COMBINATION COMBINATION SHARE
------------------------- -------------- ---------- ------
Investment Grade Bond (1)
Trust Shares 30,232,924 $1,152,435,532 $10.40
Investor Shares 229,458 35,442,645 10.40
Flex Shares -- 25,684,095 10.41
Short-Term Bond (1)
Trust Shares 7,307,720 209,577,527 9.96
Investor Shares -- 1,817,569 9.97
Flex Shares -- 2,447,180 9.98
U.S. Government Securities (1)
Trust Shares 5,438,788 101,799,419 10.32
Investor Shares -- 2,563,370 10.31
Flex Shares 307,517 11,288,553 10.32
Maryland Municipal Bond
Trust Shares 2,941,190 29,603,005 10.06
Flex Shares 764,740 7,712,932 10.09
Virginia Intermediate Municipal Bond
Trust Shares 23,538,137 240,886,726 10.23
Investor Shares 753,539 7,715,363 10.24
Virginia Municipal Bond
Trust Shares 3,019,996 31,617,660 10.47
Flex Shares 647,089 6,805,221 10.52
(1) Represents the accounting survivor in this business combination.
10. ESC Strategic Funds Merger
The Board of Directors and shareholders of the ESC Strategic Funds approved a
reorganization of the ESC Strategic Income Fund into STI Classic High Income
Fund which took place during March 2000.
The following table summarizes certain relevant information of the Funds prior
to and immediately after the business combinations in March 2000 and is
unaudited:
OUTSTANDING UNREALIZED
ON MERGER APPRECIATION
ESC STRATEGIC FUNDS DATE (DEPRECIATION)
----------------------- ------------ ------------
ESC Strategic Income
Class D 213,037 $(133,549)
SHARES ISSUE NET ASSETS NAV
IN BUSINESS AFTER PER
STI CLASSIC FUNDS COMBINATION COMBINATION SHARE
------------------ ------------- ----------- ------
High Income
Flex Shares 213,037 $1,697,825 $7.97
11. Subsequent Event
Effective June 30, 2000, SunTrustBanks, Inc. reorganized all of the investment
management functions of its three institutional money management units,
including SunTrust Bank, into Trusco Capital Management, Inc.
77
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
-------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
To the Shareholders and Board of Trustees of
STI Classic Funds:
We have audited the accompanying statements of net assets of the Florida
Tax-Exempt Bond, Georgia Tax-Exempt Bond, High Income, Investment Grade Bond,
Limited-Term Federal Mortgage Securities, Maryland Municipal Bond, Short-Term
Bond, Short-Term U.S. Treasury Securities, U.S. Government Securities, Virginia
Intermediate Municipal Bond, and Virginia Municipal Bond Funds and the statement
of assets and liabilities, including the schedule of investments, of the
Investment Grade Tax-Exempt Bond Fund of STI Classic Funds (the "Trust") as of
May 31, 2000, and the related statements of operations, changes in net assets,
and financial highlights for the periods presented, excluding the periods
indicated below. 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. The statements of changes for the year ended November 30, 1998, and
financial highlights for the periods prior to May 31, 1999, for the Maryland
Municipal Bond, Virginia Intermediate Municipal Bond, and Virginia Municipal
Bond Funds were audited by other auditors whose report dated January 15, 1999,
expressed an unqualified opinion on this information. The statement of changes
for the year ended March 31, 1999, and financial highlights for the periods
prior to March 31, 2000, for the High Income Fund, were audited by other
auditors whose report dated May 14, 1999, expressed an unqualified opinion on
this information.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. 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 and financial highlights. Our procedures included
confirmation of securities owned as of May 31, 2000, 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 audited by us
present fairly, in all material respects, the financial position of the Florida
Tax-Exempt Bond, Georgia Tax-Exempt Bond, High Income, Investment Grade Bond,
Investment Grade Tax-Exempt Bond, Limited-Term Federal Mortgage Securities,
Maryland Municipal Bond, Short-Term Bond, Short-Term U.S. Treasury Securities,
U.S. Government Securities, Virginia Intermediate Municipal Bond, and Virginia
Municipal Bond Funds, of STI Classic Funds as of May 31, 2000, the results of
their operations, changes in their net assets, and financial highlights for each
of the periods described in the first paragraph above, in conformity with
accounting principles generally accepted in the United States.
ARTHUR ANDERSEN LLP
Philadelphia, Pennsylvania
July 18, 2000
78
<PAGE>
NOTICE TO SHAREHOLDERS
--------------------------------------------------------------------------------
STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 UNAUDITED
For shareholders that do not have a May 31, 2000 tax year end, this notice is
for informational purposes only. For shareholders with a May 31, 2000, please
consult your tax adviser as to the pertinence of this notice. For the fiscal
year ended May 31, 2000, each portfolio is designating the following items with
regard to distributions paid during the year:
<TABLE>
LONG TERM
(20% RATE) ORDINARY
CAPITAL GAIN INCOME TAX-EXEMPT TOTAL QUALIFYING
FUND DISTRIBUTION DISTRIBUTIONS INTEREST INTEREST DIVIDENDS (1)
-------------------------------------------- ------------- ------------- ----------- -------- -------------
<S> <C> <C> <C> <C> <C>
Florida Tax-Exempt Bond Fund 8.30% 2.93% 88.77% 100.00% 0.00%
Georgia Tax-Exempt Bond Fund 7.06% 1.56% 91.38% 100.00% 0.00%
High Income Fund 0.00% 100.00% 0.00% 100.00% 0.00%
Investment Grade Bond Fund 0.00% 100.00% 0.00% 100.00% 0.00%
Investment Grade Tax-Exempt Bond Fund 10.08% 21.54% 68.38% 100.00% 0.00%
Limited-Term Federal Mortgage Securities Fund 0.00% 100.00% 0.00% 100.00% 0.00%
Maryland Municipal Bond Fund 0.00% 0.59% 99.41% 100.00% 0.00%
Short-Term Bond Fund 1.29% 98.71% 0.00% 100.00% 0.00%
Short-Term U.S. Treasury Securities Fund 0.25% 99.75% 0.00% 100.00% 0.00%
U.S. Government Securities 0.00% 100.00% 0.00% 100.00% 0.00%
Virginia Intermediate Municipal Bond Fund 10.95% 0.92% 88.13% 100.00% 0.00%
Virginia Municipal Bond Fund 1.00% 0.75% 98.25% 100.00% 0.00%
(1) QUALIFYING DIVIDENDS REPRESENT DIVIDENDS WHICH QUALIFY FOR THE CORPORATE
DIVIDENDS RECEIVED DEDUCTION AND IS REFLECTED AS A PERCENTAGE OF "ORDINARY
INCOME DISTRIBUTIONS".
</TABLE>
79
<PAGE>
NOTES
<PAGE>
INVESTMENT ADVISER
Trusco Capital Management, Inc.
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.
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