<PAGE>
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CHAIRMAN'S LETTER
January 17, 1996
DEAR FELLOW SHAREHOLDER:
The BNY Hamilton Funds are pleased to provide you with the annual report for
1995. This report covers the Equity Income Fund, Intermediate Government Fund
and Intermediate New York Tax-Exempt Fund.
Total assets in the three Funds increased by 14% in 1995, from $238 million to
$271 million. During the year the Funds implemented new marketing initiatives
targeting the individual, retirement and institutional markets. In 1996, the
Funds will continue to build the shareholder and asset base by identifying and
serving new potential shareholders and distribution channels.
Last year was very rewarding for investors in both stocks and bonds as the
combination of moderate economic growth, low inflation, declining interest
rates and improving corporate profits provided the perfect backdrop for finan-
cial assets. The Dow Jones Industrial Average rose by more than 1200 points and
long term interest rates dropped by a full 2 percentage points.
The Bank of New York, as investment adviser to the Funds, provides a team of
investment professionals who manage the Funds actively to take advantage of
changing market conditions.
According to Kevin J. Bannon, Chief Investment Officer of The Bank of New
York, "we believe 1996 is likely to be another good year for long term invest-
ors, although returns will not match last year's extraordinary gains." Based on
the Bank's forecast of slower economic activity in 1996, growth in corporate
profits will also be less robust. An expansion in price/earnings ratios will be
the primary impetus for higher stock prices. In the stock market, companies
with predictable growth characteristics and global exposure will be favored. In
the bond market, intermediate term issues offer the most attractive opportunity
on a risk/reward basis.
BNY HAMILTON EQUITY INCOME FUND:
The stock market enjoyed one of its strongest years ever in 1995, as investors
came to accept the fact that moderate growth and low inflation were not mutu-
ally exclusive in the context of an economy operating at high levels of re-
source utilization. In order to meet the Fund's objective of capital apprecia-
tion and income, investments were primarily focused in a strategic mix of divi-
dend paying stocks of growth oriented companies, convertible securities and
cash. In 1996, the Fund's stock selection will be focused on companies that in-
vestors are confident will deliver dependable earnings gains. These companies
are also likely to be accorded higher price/earnings ratios, potentially pro-
viding a double-barreled return. Careful stock selection will continue to be
complemented with an emphasis on higher income producing issues, including
utilities, convertible securities and real estate investment trusts. The Bank's
outlook for the stock market remains constructive for 1996.
Net asset growth for 1995 was approximately 26%, increasing from $135 million
to $170 million.
Cumulative Total Net Asset Value Public Offering Price
Return (includes 4.5% sales charge)
- ------------------------------------------------------------------------------
1 Year 25.78% 20.17%
- ------------------------------------------------------------------------------
Inception (8/10/92) 45.22% 38.70%
- ------------------------------------------------------------------------------
Average Annual Total
Return
- ------------------------------------------------------------------------------
1 Year 25.78% 20.17%
Inception (8/10/92) 11.62% 10.12%
- ------------------------------------------------------------------------------
(CONTINUED)
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<PAGE>
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CHAIRMAN'S LETTER (CONTINUED)
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
Bny Hamilton Equity Income Fund
BNY Hamilton BNY Hamilton
Equity Fund Equity Fund
Measurement period Assumes Assumes 4.50%
(Fiscal year Covered) No Load Sales Load S&P 500 Index
- --------------------- ------------ ------------- -------------
<S> <C> <C> <C>
Measurement PT -
7/31/92 $ 10,000 $ 9,551.1 $ 10,000
8/31/92 $ 9,910 $ 9,465.1 $ 9,798
9/30/92 $ 10,099 $ 9,645.7 $ 9,911
10/31/92 $ 10,149.2 $ 9,693.6 $ 9,946
11/30/92 $ 10,460.8 $ 9,991.2 $ 10,282
12/31/92 $ 10,586.4 $ 10,111.1 $ 10,417
1/31/93 $ 10,708.2 $ 10,227.5 $ 10,493
2/28/93 $ 10,753.8 $ 10,271.1 $ 10,634
3/31/93 $ 11,160.8 $ 10,659.8 $ 10,864
4/30/93 $ 11,079.2 $ 10,581.8 $ 10,597
5/31/93 $ 11,280.5 $ 10,774.2 $ 10,883
6/30/93 $ 11,383 $ 10,872 $ 10,918
7/31/93 $ 11,465.2 $ 10,950.5 $ 10,868
8/31/93 $ 11,773.9 $ 11,245.4 $ 11,282
9/30/93 $ 11,810 $ 11,279.9 $ 11,199
10/31/93 $ 11,830.7 $ 11,299.7 $ 11,427
11/30/93 $ 11,561.4 $ 11,042.4 $ 11,319
12/31/93 $ 11,850.7 $ 11,318.7 $ 11,458
1/31/94 $ 12,259.7 $ 11,709.4 $ 11,842
2/28/94 $ 12,018 $ 11,478.6 $ 11,522
3/31/94 $ 11,473.4 $ 10,958.4 $ 11,020
4/30/94 $ 11,389 $ 10,877.8 $ 11,163
5/31/94 $ 11,558.2 $ 11,039.4 $ 11,346
6/30/94 $ 11,192.4 $ 10,690 $ 11,065
7/31/94 $ 11,564.7 $ 11,045.6 $ 11,431
8/31/94 $ 11,841.8 $ 11,310.3 $ 11,896
9/30/94 $ 11,617.4 $ 11,096 $ 11,609
10/31/94 $ 11,751.4 $ 11,223.9 $ 11,875
11/30/94 $ 11,386.5 $ 10,875.4 $ 11,439
12/31/94 $ 11,545.2 $ 11,027 $ 11,606
1/31/95 $ 11,642.3 $ 11,119.8 $ 11,908
2/28/95 $ 11,985.6 $ 11,447.6 $ 12,371
3/31/95 $ 12,213.1 $ 11,664.9 $ 12,737
4/30/95 $ 12,479.3 $ 11,919.2 $ 13,110
5/31/95 $ 12,770.4 $ 12,197.2 $ 13,629
6/30/95 $ 13,062.4 $ 12,476 $ 13,949
7/31/95 $ 13,554.7 $ 12,946.2 $ 14,414
8/31/95 $ 13,502.6 $ 12,896.5 $ 14,453
9/30/95 $ 13,925.6 $ 13,300.5 $ 15,060
10/31/95 $ 13,779.9 $ 13,161.3 $ 15,007
11/30/95 $ 14,295.2 $ 13,653.6 $ 15,667
12/31/95 $ 14,521.7 $ 13,869.9 $ 15,957
</TABLE>
The S&P 500 Index is an unmanaged index of common stocks and cannot be
invested in directly. The Index does not take into account fees and expenses.
Past performance is no guarantee of future results. Investment return and
principal will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. For comparative purposes, the
Index's July 31, 1992 value is used as the August 10, 1992 value.
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND:
1995 was a tremendous year for the bond market as the sharp decline in inter-
mediate and longer term interest rates produced strong double digit returns in
most fixed income securities. After one final tightening to head off inflation
pressures in February, the Federal Reserve began easing monetary policy gradu-
ally during the second half of the year in recognition of softening economic
activity. The Bank's outlook for the fixed income market remains positive as
bonds are expected to continue to provide strong single digit returns in an en-
vironment of slow growth and low inflation. Yield curve positioning in the 4-7
year maturity range and utilization of "spread product" such as mortgage-backed
securities will be emphasized in 1996.
Net asset growth for 1995 was approximately 3%, increasing from $59 million to
$61 million.
Cumulative Total Net Asset Value Public Offering Price
Return (including 3% sales charge)
- --------------------------------------------------------------------------------
1 Year 15.40% 11.96%
- --------------------------------------------------------------------------------
Inception (8/10/92) 18.82% 15.24%
- --------------------------------------------------------------------------------
Average Annual Total
Return
- --------------------------------------------------------------------------------
1 Year 15.40% 11.96%
- --------------------------------------------------------------------------------
Inception (8/10/92) 5.21% 4.27%
- --------------------------------------------------------------------------------
(CONTINUED)
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<PAGE>
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CHAIRMAN'S LETTER (CONTINUED)
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
BNY Hamilton Equity Income Fund
BNY Hamilton BNY Hamilton
Intermediate Intermediate Lehman Bros.
Government Government Intermediate
Measurement period Fund Without Fund Assumes Government
(Fiscal year Covered) Sales Load 3% Sales Load Index
- --------------------- ------------ ------------- -------------
<S> <C> <C> <C>
Measurement PT -
7/31/92 $ 10,000 $ 9,699.3 $ 10,000
8/31/92 $ 9,984 $ 9,683.8 $ 10,102
9/30/92 $ 10,132.9 $ 9,828.2 $ 10,241
10/31/92 $ 9,992 $ 9,691.5 $ 10,118
11/30/92 $ 9,940.6 $ 9,641.7 $ 10,077
12/31/92 $ 10,050.6 $ 9,748.4 $ 10,207
1/31/93 $ 10,223.1 $ 9,915.7 $ 10,397
2/28/93 $ 10,393.3 $ 10,080.8 $ 10,550
3/31/93 $ 10,414.3 $ 10,101.1 $ 10,589
4/30/93 $ 10,486.8 $ 10,171.5 $ 10,672
5/31/93 $ 10,471.3 $ 10,156.4 $ 10,643
6/30/93 $ 10,662.2 $ 10,341.6 $ 10,797
7/31/93 $ 10,678.7 $ 10,357.6 $ 10,818
8/31/93 $ 10,872.6 $ 10,545.7 $ 10,980
9/30/93 $ 10,928.8 $ 10,600.2 $ 11,024
10/31/93 $ 10,964.5 $ 10,634.8 $ 11,050
11/30/93 $ 10,818.9 $ 10,493.6 $ 10,996
12/31/93 $ 10,857.2 $ 10,530.8 $ 11,041
1/31/94 $ 11,009.4 $ 10,678.4 $ 11,150
2/28/94 $ 10,739.3 $ 10,416.4 $ 10,997
3/31/94 $ 10,473 $ 10,158.1 $ 10,837
4/30/94 $ 10,377.7 $ 10,065.7 $ 10,766
5/31/94 $ 10,359.8 $ 10,048.3 $ 10,774
6/30/94 $ 10,296.7 $ 9,987.1 $ 10,776
7/31/94 $ 10,429.9 $ 10,116.4 $ 10,918
8/31/94 $ 10,452.8 $ 10,138.5 $ 10,950
9/30/94 $ 10,309.6 $ 9,999.7 $ 10,859
10/31/94 $ 10,290.6 $ 9,981.2 $ 10,861
11/30/94 $ 10,247.3 $ 9,939.2 $ 10,813
12/31/94 $ 10,296 $ 9,986.4 $ 10,848
1/31/95 $ 10,458.4 $ 10,144 $ 11,025
2/28/95 $ 10,686.2 $ 10,364.9 $ 11,237
3/31/95 $ 10,748.6 $ 10,425.4 $ 11,299
4/30/95 $ 10,890.4 $ 10,563 $ 11,430
5/31/95 $ 11,275.2 $ 10,936.2 $ 11,753
6/30/95 $ 11,337.2 $ 10,996.3 $ 11,827
7/31/95 $ 11,308.2 $ 10,968.2 $ 11,833
8/31/95 $ 11,407.7 $ 11,064.7 $ 11,930
9/30/95 $ 11,495.2 $ 11,149.6 $ 12,011
10/31/95 $ 11,608.6 $ 11,259.6 $ 12,142
11/30/95 $ 11,756.2 $ 11,402.8 $ 12,290
12/31/95 $ 11,811.7 $ 11,524.4 $ 12,412
</TABLE>
The Lehman Brothers Intermediate Government Index is an unmanaged index
generally considered representative of the U.S. Government intermediate-term
bond market. The Index does not take into account fees and expenses. Past
performance is no guarantee of future results. Investment return and principal
value will fluctuate so that an investor's shares, when redeemed, may be worth
more or less than their original cost. For comparative purposes, the Index's
July 31, 1992 value is used as the August 10, 1992 value.
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND:
The flat tax debate has been an important influence on the investment activity
in the Fund over the past year. The Bank expected this topic to attract in-
creasing attention in 1995 putting upward pressure on municipal yields compared
with taxable yields. Reflecting these concerns, the investment strategy for the
Fund was adjusted to incorporate a more defensive posture. New purchases were
limited to bonds with maturities no longer than seven years. Existing holdings
of bonds with maturities longer than ten years were also reviewed and changes
were made where deemed appropriate. The average maturity of the Fund on Decem-
ber 31, 1995 was 5 years, down from 6 years 4 months a year ago. The Bank ex-
pects that tax reform will be actively debated in the 1996 Presidential elec-
tion campaign, but does not anticipate the enactment of a flat tax any time
soon. The conservative structure of the portfolio will be maintained pending
some lifting of the flat tax clouds.
Net assets decreased during 1995 by approximately 5%, from $43 million to $41
million.
Cumulative Total Net Asset Value Public Offering Price
Return (includes 3% sales charge)
- --------------------------------------------------------------------------------
1 Year 12.08% 8.68%
- --------------------------------------------------------------------------------
Inception (8/10/92) 17.79% 14.25%
- --------------------------------------------------------------------------------
Average Annual Total
Return
- --------------------------------------------------------------------------------
1 Year 12.08% 8.68%
- --------------------------------------------------------------------------------
Inception (8/10/92) 4.94% 4.00%
- --------------------------------------------------------------------------------
(CONTINUED)
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<PAGE>
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CHAIRMAN'S LETTER (CONTINUED)
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
Bny Hamilton Intermediate New York Tax Exempt Fund
BNY Hamilton BNY Hamilton
Intermediate Intermediate
New York Tax New York Tax
Exempt Fund Exempt Fund Lehman Bros.
Measurement period Without Assumes 5 Year State
(Fiscal year Covered) Sales Load 3% Sales Load G.O Index
- --------------------- ------------ ------------- -------------
<S> <C> <C> <C>
Measurement PT -
7/31/92 $ 10,000 $ 9,699.3 $ 9,699.3
8/31/92 $ 9,927.5 $ 9,629 $ 9,925.2
9/30/92 $ 9,978 $ 9,678 $ 9,988.5
10/31/92 $ 9930.6 $ 9,631.9 $ 9,954.1
11/30/92 $ 10,043.7 $ 9,741.7 $ 10,072.1
12/31/92 $ 10,118 $ 9,813.8 $ 10,145.5
1/31/93 $ 10,223.9 $ 9,926.2 $ 10,256.4
2/28/93 $ 10,457.3 $ 10,142.8 $ 10,521.5
3/31/93 $ 10,356.2 $ 10,044.8 $ 10,405.6
4/30/93 $ 10,428.7 $ 10,115.2 $ 10,467.8
5/31/93 $ 10,451.2 $ 10,137 $ 10,504.8
6/30/93 $ 10,587.8 $ 10,269.5 $ 10,644.9
7/31/93 $ 10,549.4 $ 10,232.2 $ 10,646.1
8/31/93 $ 10,718.4 $ 10,396.1 $ 10,793.2
9/30/93 $ 10,813.8 $ 10,488.7 $ 10,875.7
10/31/93 $ 10,826.7 $ 10,501.2 $ 10,888.5
11/30/93 $ 10.775.6 $ 10,451.7 $ 10,862.2
12/31/93 $ 10,926.3 $ 10,597.8 $ 11,012.7
1/31/94 $ 11,034.8 $ 10,703 $ 11,117.8
2/28/94 $ 10,812.8 $ 10,487.7 $ 10,898.4
3/31/94 $ 10,572.3 $ 10,254.4 $ 10,654.5
4/30/94 $ 10,607.2 $ 10,288.2 $ 10,760.6
5/31/94 $ 10,686.1 $ 10,364.8 $ 10,823.4
6/30/94 $ 10,656.7 $ 10,336.3 $ 10,795.5
7/31/94 $ 10,766.4 $ 10,442.7 $ 10,907.6
8/31/94 $ 10,801.2 $ 10,476.4 $ 10,960.4
9/30/94 $ 10,673.1 $ 10,352.2 $ 10,879.1
10/31/94 $ 10,556.9 $ 10,239.5 $ 10,818.7
11/30/94 $ 10,385.4 $ 10,073.1 $ 10,736.6
12/31/94 $ 10,509.7 $ 10,193.7 $ 10,834.1
1/31/95 $ 10,667.4 $ 10,346.7 $ 10,948.4
2/28/95 $ 10,931.9 $ 10,603.2 $ 11,111.4
3/31/95 $ 11,035.3 $ 10,703.5 $ 11,297.7
4/30/95 $ 11,082.7 $ 10,749.5 $ 11,326.3
5/31/95 $ 11,330.8 $ 10,990.1 $ 11,571.7
6/30/95 $ 11,333 $ 10,992.2 $ 11,587.5
7/31/95 $ 11,425.6 $ 11,082.1 $ 11,749.8
8/31/95 $ 11,529.8 $ 11,183.1 $ 11,853.4
9/30/95 $ 11,554.4 $ 11,207 $ 11,891.4
10/31/95 $ 11,614.3 $ 11,265.1 $ 11,939.9
11/30/95 $ 11,707.4 $ 11,355.4 $ 12,044.5
12/31/95 $ 11,779.2 $ 11,425 $ 12,113.3
</TABLE>
The Lehman Brothers 5-Year State G.O. Index is an unmanaged index generally
considered representative of the intermediate state general obligation munici-
pal bond market. The Index does not take into account fees and expenses. Past
performance is no guarantee of future results. Investment return and principal
value will fluctuate so that an investor's shares, when redeemed, may be worth
more or less than their original cost. Some investors may be subject to the al-
ternative minimum tax and/or state and local taxes. For comparative purposes,
the Index's July 31, 1992 value is used as the August 10, 1992 value.
I would like to welcome all new BNY Hamilton Fund shareholders and thank all
our existing shareholders for your investment in the Funds. The BNY Hamilton
Funds are committed to providing investment products to assist its shareholders
in meeting their long-term financial goals through changing market environ-
ments.
Sincerely,
/s/ Eugene J. Sullivan
Eugene Sullivan
Chairman of the Board
BNY Hamilton Funds, Inc.
MONEY FUND AVAILABLE TO INDIVIDUAL INVESTORS:
The Funds are pleased to announce the availability of the BNY Hamilton Money
Fund, Hamilton Classic Shares. The "Hamilton Classic Shares" were started on
December 4, 1995 for individual investors and allows the Funds to better serv-
ice the investment needs of existing and prospective shareholders. The 7-day
current yield for the "Hamilton Classic Shares" was 4.99% at December 31,
1995. The BNY Hamilton Money Fund maintains a "AAAm" rating by Standard and
Poor's. According to Standard and Poor's, this rating is historical and based
upon the Fund's credit quality, market price exposure and management. The rat-
ing signifies that the Fund's safety is excellent and that it has a superior
capacity to maintain its $1.00 net asset value per share.
An investment in the fund is neither insured nor guaranteed by the U.S. Gov-
ernment. Yields will fluctuate, and there can be no assurance that the fund
will be able to maintain a stable NAV of $1.00 per share.
For more complete information about the BNY Hamilton Money Fund Classic
Shares including charges and expenses, call 1-800-426-9363 for a prospectus.
Read it carefully before you invest or send money.
- --------------------------------------------------------------------------------
<PAGE>
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TABLE OF CONTENTS
EQUITY INCOME FUND
SCHEDULE OF INVESTMENTS...................... Page 1
STATEMENT OF ASSETS AND LIABILITIES.......... 5
STATEMENT OF OPERATIONS...................... 5
STATEMENTS OF CHANGES IN NET ASSETS.......... 6
FINANCIAL HIGHLIGHTS......................... 7
INTERMEDIATE GOVERNMENT FUND
SCHEDULE OF INVESTMENTS...................... 8
STATEMENT OF ASSETS AND LIABILITIES.......... 9
STATEMENT OF OPERATIONS...................... 9
STATEMENTS OF CHANGES IN NET ASSETS.......... 10
FINANCIAL HIGHLIGHTS......................... 11
INTERMEDIATE NEW YORK TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS...................... 12
STATEMENT OF ASSETS AND LIABILITIES.......... 16
STATEMENT OF OPERATIONS...................... 16
STATEMENTS OF CHANGES IN NET ASSETS.......... 17
FINANCIAL HIGHLIGHTS......................... 18
NOTES TO FINANCIAL STATEMENTS.................. 19
REPORT OF INDEPENDENT ACCOUNTANTS.............. 23
FEDERAL INCOME TAX INFORMATION................. 23
DIRECTORS AND OFFICERS......................... 24
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<PAGE>
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BNY HAMILTON EQUITY INCOME FUND
Schedule of Investments
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
NUMBER OF
SHARES MARKET VALUE
--------- ------------
[C] [S] [C]
COMMON STOCKS--70.56%
AIRCRAFT MANUFACTURING--2.40%
52,000 Boeing Co............................................. $ 4,075,500
------------
BANKING--2.10%
20,000 Chase Manhattan Corp.................................. 1,212,500
70,000 U.S. Bancorp.......................................... 2,353,750
------------
3,566,250
------------
BEVERAGES--2.24%
25,000 Coca Cola Co.......................................... 1,856,250
35,000 Pepsico Inc........................................... 1,955,625
------------
3,811,875
------------
BUSINESS EQUIPMENT
& SERVICES--2.02%
25,000 Xerox Corp............................................ 3,425,000
------------
CHEMICALS--PETROLEUM--1.44%
35,000 du Pont (EI) de Nemours............................... 2,445,625
------------
COMMUNICATIONS &
ENTERTAINMENT--1.22%
55,000 Time Warner Inc....................................... 2,083,125
------------
COMMUNICATIONS
& PUBLISHING--1.36%
55,000 Harcourt General, Inc................................. 2,303,125
------------
COMPUTERS--MICRO--1.13%
*40,000 Compaq Computer....................................... 1,920,000
------------
COMPUTERS--SOFTWARE & PERIPHERALS--1.59%
*20,000 Cisco Systems......................................... 1,492,500
*40,000 Informix Corp......................................... 1,200,000
------------
2,692,500
------------
CONGLOMERATES--2.31%
20,000 General Electric...................................... 1,440,000
50,000 Tenneco Inc........................................... 2,481,250
------------
3,921,250
------------
COSMETICS & TOILETRIES--1.33%
30,000 Avon Products, Inc.................................... 2,261,250
------------
ELECTRICAL EQUIPMENT--1.26%
130,000 Westinghouse Electric Corp............................ 2,145,000
------------
ELECTRONICS--0.99%
20,000 Hewlett Packard....................................... 1,675,000
------------
NUMBER OF MARKET
SHARES VALUE
--------- ------------
[C] [S] [C]
FINANCIAL SERVICES--1.37%
60,000 Invesco PLC (ADR)..................................... $ 2,325,000
------------
FINANCIAL SERVICES--MORTGAGE COMPANIES--1.61%
22,000 Federal National Mortgage Association................. 2,730,750
------------
FOOD & BEVERAGES--1.73%
65,000 McDonald's Corp....................................... 2,933,125
------------
FOOD PROCESSING--2.82%
35,000 CPC International Inc................................. 2,401,875
17,000 Unilever NV........................................... 2,392,750
------------
4,794,625
------------
HEALTH & PERSONAL CARE
PRODUCTS--1.71%
30,000 American Home Products................................ 2,910,000
------------
HEALTH CARE PRODUCTS &
SERVICES--2.31%
38,750 Columbia Healthcare................................... 1,966,563
30,000 United Healthcare Corp................................ 1,965,000
------------
3,931,563
------------
HOUSEHOLD & PERSONAL CARE PRODUCTS--1.47%
30,000 Procter & Gamble Company.............................. 2,490,000
------------
INSURANCE--0.98%
18,000 American International Group, Inc..................... 1,665,000
------------
MACHINERY & EQUIPMENT--0.61%
20,000 Stanley Works......................................... 1,030,000
------------
NATURAL GAS--1.18%
60,000 Questar Corp.......................................... 2,010,000
------------
OIL & GAS--1.55%
60,000 Williams Cos. ........................................ 2,632,500
------------
OIL--DOMESTIC--1.83%
28,000 Atlantic Richfield Co................................. 3,101,000
------------
OIL--INTERNATIONAL--5.41%
15,000 British Petroleum Company (ADR)....................... 1,531,875
45,000 Elf Aquitaine (ADR)................................... 1,653,750
47,000 Exxon Corp............................................ 3,765,875
20,000 Mobil Corp............................................ 2,240,000
------------
9,191,500
See notes to financial statements.
- --------------------------------------------------------------------------------
1
<PAGE>
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BNY HAMILTON EQUITY INCOME FUND
Schedule of Investments (Continued)
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
NUMBER OF
SHARES MARKET VALUE
--------- ------------
[C] [S] [C]
COMMON STOCKS (CONTINUED)
PHARMACEUTICALS--2.88%
23,000 Johnson & Johnson..................................... $ 1,969,375
30,000 Warner Lambert ....................................... 2,913,750
------------
4,883,125
------------
RAILROADS--3.79%
37,233 Burlington Northern Santa Fe Corp. ................... 2,904,174
*53,300 Canadian National Railway............................. 799,500
60,000 CSX Corp.............................................. 2,737,500
------------
6,441,174
------------
REAL ESTATE INVESTMENT
TRUSTS--4.32%
85,000 Avalon Properties..................................... 1,827,500
80,833 Camden Property Trust................................. 1,929,887
80,000 Federal Realty Investment Trust....................... 1,820,000
85,000 General Growth Properties............................. 1,763,750
------------
7,341,137
------------
RESORTS & ENTERTAINMENT--2.26%
61,000 Carnival Cruise Lines, Class A........................ 1,486,875
40,000 Walt Disney Co........................................ 2,360,000
------------
3,846,875
------------
RETAIL--SPECIALTY STORES--1.74%
34,666 Home Depot, Inc....................................... 1,659,635
*58,100 Office Max............................................ 1,299,988
------------
2,959,623
------------
TECHNOLOGY INDUSTRIES--1.21%
36,000 Motorola, Inc......................................... 2,052,000
------------
TELECOMMUNICATIONS--
NON-U.S.--1.23%
50,000 Telefonica de Espana (ADR)............................ 2,093,750
------------
TOYS--0.91%
50,000 Mattel Inc. .......................................... 1,537,500
------------
NUMBER OF
SHARES MARKET VALUE
--------- ------------
COMMON STOCKS (CONTINUED)
UTILITIES--ELECTRIC--6.25%
60,000 DQE Inc. ............................................. $ 1,845,000
75,000 Florida Progress Corp. ............................... 2,653,125
40,000 Portland General...................................... 1,165,000
65,000 SCANA Corp. .......................................... 1,860,625
75,000 Texas Utilities Co. .................................. 3,084,375
------------
10,608,125
------------
TOTAL COMMON STOCKS
(Cost $98,126,645).................................... 119,833,872
------------
CONVERTIBLE PREFERRED
STOCKS--14.62%
BANKING--0.65%
15,000 Jefferson-Pilot "NB" (ACES)........................... 1,096,875
------------
BUSINESS EQUIPMENT & SERVICES--1.60%
10,000 Alco Standard Corp., Series AA........................ 1,015,000
20,000 Alco Standard Corp., Series BB........................ 1,710,000
------------
2,725,000
------------
COMMUNICATIONS EQUIPMENT
& SYSTEMS--0.95%
30,000 LCI International, Inc................................ 1,605,000
------------
COMPUTER SERVICES--2.82%
27,163 Ceridian Corp......................................... 2,512,577
31,100 General Motors, Class E,
Series C.............................................. 2,278,075
------------
4,790,652
------------
COMPUTERS--SOFTWARE & PERIPHERALS--0.36%
7,500 Houghton Mifflin...................................... 607,500
------------
FINANCIAL SERVICES--1.47%
45,000 American Express (DECS)............................... 2,497,500
------------
GOLD & PRECIOUS METALS--1.19%
70,000 Freeport--McMoran Copper & Gold....................... 2,012,500
------------
INDUSTRIAL GOODS &
EQUIPMENT--1.18%
35,000 Sonoco Products, Series A............................. 1,999,375
------------
INSURANCE--0.60%
25,000 Allstate Corp. ....................................... 1,025,000
------------
See notes to financial statements.
- --------------------------------------------------------------------------------
2
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON EQUITY INCOME FUND
Schedule of Investments (Continued)
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
NUMBER OF
SHARES MARKET VALUE
--------- ------------
CONVERTIBLE PREFERRED STOCKS (CONTINUED)
OIL & GAS--1.67%
80,000 Atlantic Richfield Co. ......................... $ 1,880,000
40,000 Enron Corp. .................................... 960,000
------------
2,840,000
------------
PHARMACEUTICALS--1.54%
11,000 Lehman 6.5% Amgen Yield Enhanced Equity Linked
Debt Securities ("YEELDS")...................... 671,000
30,000 Salomon 6.5% Amgen Yield Enhanced Equity Linked
Debt Securities ("YEELDS")...................... 1,948,125
------------
2,619,125
------------
STEEL--0.59%
30,000 AK Steel........................................ 1,005,000
------------
TOTAL CONVERTIBLE
PREFERRED STOCKS
(Cost $19,700,503).............................. 24,823,527
------------
PRINCIPAL
AMOUNT
---------
CONVERTIBLE BONDS--8.22%
BUSINESS SERVICES--0.88%
$1,250,000 Olsten, 4.875%, 5/15/03......................... 1,493,750
------------
COMMUNICATIONS &
ENTERTAINMENT--1.34%
1,700,000 Comcast, 3.375%, 9/09/05........................ 1,595,875
663,750 Time Warner, 8.75%, 1/10/15..................... 687,811
------------
2,283,686
------------
HEALTH CARE & HOSPITAL MANAGEMENT--1.18%
1,250,000 HEALTHSOUTH Rehabilitation Corp.,
5.00%, 4/01/01.................................. 2,009,375
------------
INDUSTRIAL GOODS &
EQUIPMENT--0.30%
500,000 LaFarge Corp, 7.00%, 7/01/13 509,375
------------
PRINCIPAL MARKET
AMOUNT VALUE
--------- -----------
CONVERTIBLE BONDS (CONTINUED)
OIL--DOMESTIC--0.75%
$ 1,000,000 Pennzoil, 6.50%, 1/15/03........................ $ 1,265,000
-----------
REAL ESTATE INVESTMENT
TRUSTS--0.91%
1,500,000 Liberty Property Trust, 8.00%, 7/01/01.......... 1,546,875
-----------
RESORTS & ENTERTAINMENT--0.50%
600,000 Carnival Cruise Lines Inc., 4.50%, 7/01/97...... 850,500
-----------
RETAIL--SPECIALTY STORES--0.69%
1,000,000 Baby Superstore, 4.875%, 10/01/00............... 1,171,250
-----------
SEMICONDUCTORS--0.49%
900,000 VLSI Technology Inc., 8.25%, 10/01/05........... 830,250
-----------
TEXTILES--0.59%
1,000,000 Unifi Inc., 6.00%, 3/15/02...................... 1,007,500
-----------
UTILITIES--GAS--0.59%
1,000,000 Noble Affiliates Inc., 4.25%, 11/01/03.......... 1,002,500
-----------
TOTAL CONVERTIBLE BONDS
(Cost $12,461,247).............................. 13,970,061
-----------
REPURCHASE
AGREEMENT--6.31%
10,712,000 Repurchase agreement with Deutsche Bank, 6.00%,
due 1/02/96, repurchase price $10,719,141
(Collateral--Various U.S. Governmental Agency
Debt Instruments, 0.00%-6.96%, 3/30/98-11/01/05;
aggregate market value plus accrued interest
$10,927,167)
(Cost $10,712,000).............................. 10,712,000
-----------
See notes to financial statements.
- --------------------------------------------------------------------------------
3
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON EQUITY INCOME FUND
Schedule of Investments (Continued)
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
STRIKE MARKET
CONTRACTS PRICE VALUE
--------- ------ ------------
PURCHASED PUT
OPTIONS--0.16%
* 90 Motorola, Inc. expiration 1/20/96............ 70 $ 115,875
* 90 Motorola, Inc. expiration 1/20/96............ 75 165,375
* 105 S&P 500, expiration 1/20/96 ................. 540 1,312
------------
TOTAL PURCHASED PUT OPTIONS (Cost $84,293)... 282,562
------------
TOTAL INVESTMENTS BEFORE OUTSTANDING WRITTEN
CALL OPTIONS (Cost $141,084,688)--(a) 99.87%. 169,622,022
------------
OUTSTANDING WRITTEN
CALL OPTIONS--(0.46)%
* 105 S&P 500,
expiration 1/20/96 (Premium Received
$595,540).................................... (788,156)
------------
TOTAL INVESTMENTS NET OF OUTSTANDING WRITTEN
CALL OPTIONS (Cost $140,489,148) 99.41%...... 168,833,866
Cash, receivables, and other assets less
liabilities--0.59%........................... 1,006,979
------------
NET ASSETS--100.00% $169,840,845
------------
* Non-income producing security.
ACES Automatic Common Exchange Securities.
ADR American Depository Receipt.
DECS Debt Exchangeable for Common Stock.
(a) The cost stated also represents the aggregate cost for Federal income tax
purposes. At December 31, 1995, net unrealized appreciation was $28,537,334
based on cost for Federal income tax purposes. This consisted of aggregate
gross unrealized appreciation of $29,110,435 and aggregate gross unrealized
depreciation of $573,101.
See notes to financial statements.
- --------------------------------------------------------------------------------
4
<PAGE>
- --------------------------------------------------------------------------------
BNY HAMILTON EQUITY INCOME FUND
- ------
Statement of Assets and Liabilities Statement of Operations
DECEMBER 31, 1995 FOR THE YEAR ENDED DECEMBER 31,
1995
- --------------------------------------------------------------------------------
ASSETS:
Investments at market value, (Identified cost $141,084,688)...... $169,622,022
Receivables:
Investments sold................................................ 4,043,951
Interest........................................................ 241,709
Dividends....................................................... 439,149
Capital stock sold.............................................. 134,283
Deferred organization costs and other assets..................... 34,083
------------
TOTAL ASSETS.................................................... 174,515,197
------------
LIABILITIES:
Payables:
Due to custodian................................................ 443,987
Investments purchased........................................... 2,816,582
Capital stock repurchased....................................... 10,595
Dividends....................................................... 433,456
Services provided by The Bank of New York and Administrator..... 130,678
Outstanding call options written (premiums received $595,540).... 788,156
Accrued expenses and other liabilities........................... 50,898
------------
TOTAL LIABILITIES............................................... 4,674,352
------------
NET ASSETS:
(applicable to 13,077,388 shares issued and outstanding; 200
million shares of $.001 par value authorized)................... $169,840,845
------------
Net asset value, offering price and repurchase price per share
($169,840,845/13,077,388 shares) $ 12.99
------------
Maximum public offering price per share ($12.99/.955)............ $ 13.60
------------
SOURCES OF NET ASSETS:
Capital stock @ par.............................................. $ 13,077
Capital surplus.................................................. 141,336,546
Undistributed net investment income.............................. 65,503
Accumulated net realized gain on investments..................... 81,001
Net unrealized appreciation on investments....................... 28,344,718
------------
NET ASSETS........................................................ $169,840,845
------------
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $37,401).......... $ 3,939,692
Interest......................................................... 1,782,826
-----------
TOTAL INCOME.................................................... 5,722,518
-----------
EXPENSES:
Advisory ........................................................ 936,192
Administration................................................... 312,064
Accounting services.............................................. 60,000
Custodian........................................................ 44,187
Cash management.................................................. 12,214
Transfer agent................................................... 68,048
Audit............................................................ 13,253
Insurance........................................................ 12,158
Directors ....................................................... 15,797
Reports to shareholders.......................................... 17,242
Registration and filings......................................... 21,066
Legal............................................................ 19,880
Other............................................................ 33,199
-----------
TOTAL EXPENSES.................................................. 1,565,300
-----------
NET INVESTMENT INCOME........................................... 4,157,218
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--
Net realized gain on investment transactions..................... 7,628,369
Net realized loss on written call options........................ (899,162)
-----------
Net realized gain on investments................................. 6,729,207
-----------
Increase in unrealized appreciation on investments during the
year............................................................ 24,785,096
Decrease in unrealized appreciation on written call options...... (56,128)
-----------
Net unrealized gain on investments during the year............... 24,728,968
-----------
Net realized and unrealized gain on investments.................. 31,458,175
-----------
Net increase in net assets resulting from operations............. $35,615,393
-----------
See notes to financial statements.
- --------------------------------------------------------------------------------
5
<PAGE>
- --------------------------------------------------------------------------------
BNY HAMILTON EQUITY INCOME FUND
- ------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
--------------------------
1995 1994
------------ ------------
OPERATIONS:
Net investment income............................. $ 4,157,218 $ 3,803,163
Net realized gain (loss) on investments........... 6,729,207 (5,126,955)
Net unrealized gain (loss) on investments during
the year......................................... 24,728,968 (2,206,579)
------------ ------------
Net increase (decrease) in net assets resulting
from operations................................. 35,615,393 (3,530,371)
------------ ------------
DIVIDENDS AND DISTRIBUTION TO SHAREHOLDERS:
Dividends from net investment income.............. (4,143,915) (3,767,657)
Distribution from capital gains................... (1,521,251) --
------------ ------------
Total dividends and distribution to shareholders. (5,665,166) (3,767,657)
------------ ------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold.................. 28,650,069 51,788,650
Proceeds from reinvestment of dividends and
distribution..................................... 3,841,802 2,380,531
Cost of capital stock repurchased................. (27,731,884) (24,589,231)
------------ ------------
Net increase in net assets resulting from capital
stock transactions.............................. 4,759,987 29,579,950
------------ ------------
INCREASE IN NET ASSETS.......................... 34,710,214 22,281,922
NET ASSETS:
Beginning of year................................. 135,130,631 112,848,709
------------ ------------
End of year....................................... $169,840,845 $135,130,631
------------ ------------
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold....................................... 2,490,205 4,656,303
Shares issued on reinvestment of dividends and
distribution..................................... 312,500 218,778
Shares repurchased................................ (2,352,875) (2,235,781)
------------ ------------
Net increase..................................... 449,830 2,639,300
Shares outstanding, beginning of year............. 12,627,558 9,988,258
------------ ------------
Shares outstanding, end of year................... 13,077,388 12,627,558
------------ ------------
See notes to financial statements.
- --------------------------------------------------------------------------------
6
<PAGE>
- --------------------------------------------------------------------------------
BNY HAMILTON EQUITY INCOME FUND
- ------
Financial Highlights
- --------------------------------------------------------------------------------
FOR THE
PERIOD
AUGUST 10,
1992*
YEAR ENDED DECEMBER 31, THROUGH
----------------------------- DECEMBER
1995 1994 1993 31, 1992
-------- -------- -------- ----------
PER SHARE DATA:
Net asset value at beginning of
period........................... $ 10.70 $ 11.30 $ 10.43 $ 10.00
-------- -------- -------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income............. 0.32 0.31 0.29 0.11
Net realized and unrealized gain
(loss) on investments............ 2.41 (0.60) 0.94 0.47
-------- -------- -------- -------
Total from investment operations. 2.73 (0.29) 1.23 0.58
-------- -------- -------- -------
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment
income........................... (0.32) (0.31) (0.28) (0.12)
Distributions from capital gains.. (0.12) -- (0.08) (0.03)
-------- -------- -------- -------
Total dividends and
distributions................... (0.44) (0.31) (0.36) (0.15)
-------- -------- -------- -------
Net asset value at end of period.. $ 12.99 $ 10.70 $ 11.30 $ 10.43
-------- -------- -------- -------
TOTAL RETURN+..................... 25.78% (2.58)% 11.94% 5.86%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period
(000's omitted).................. $169,841 $135,131 $112,849 $20,440
Ratio to average net assets of:
Expenses, net of waiver from The
Bank of New York................ 1.00% 1.04% 1.09% 1.10%***
Expenses, prior to waiver from
The Bank of New York............ 1.00% 1.04% 1.12% 2.12%***
Net investment income, net of
waiver from The Bank of New
York............................ 2.66% 2.89% 2.82% 3.33%***
Portfolio turnover rate........... 58% 51% 50% 25%
Average commission rate paid per
share traded..................... $ .0557
* Commencement of investment operations.
** Not annualized.
*** Annualized.
+ Total return does not consider the effect of the sales load.
See notes to financial statements.
- --------------------------------------------------------------------------------
7
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
Schedule of Investments
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
--------- -----------
U.S. GOV'T AGENCIES & OBLIGATIONS--80.38%
UNITED STATES GOVERNMENT AGENCY SECURITIES--45.50%
Federal Home Loan Bank,
$1,000,000 5.75%, 3/10/97....................................... $ 1,005,472
500,000 5.25%, 7/16/97....................................... 496,743
4,000,000 5.37%, 11/3/00....................................... 3,951,180
Federal Home Loan Mortgage Corporation,
500,000 5.80%, 7/7/98........................................ 503,782
500,000 5.76%, 7/13/98....................................... 499,103
3,100,000 6.33%, 2/16/00....................................... 3,102,210
500,000 7.84%, 4/26/00....................................... 504,371
1,000,000 5.55%, 9/7/00........................................ 988,580
3,300,000 6.61%, 3/4/03........................................ 3,354,123
Federal National Mortgage Association,
500,000 5.35%, 8/12/98....................................... 497,448
3,100,000 6.20%, 7/10/03....................................... 3,074,282
Tennessee Valley Authority,
1,500,000 6.25%, 8/1/99........................................ 1,524,602
1,000,000 6.00%, 11/1/00....................................... 1,014,507
5,000,000 6.125%, 7/15/03...................................... 5,019,285
2,000,000 6.375%, 6/15/05...................................... 2,062,124
-----------
27,597,812
-----------
UNITED STATES TREASURY
BONDS--6.35%
3,500,000 7.625%, 2/15/07...................................... 3,851,089
-----------
UNITED STATES TREASURY
NOTES--27.28%
1,600,000 5.625%, 1/31/98...................................... 1,613,000
1,600,000 5.875%, 8/15/98...................................... 1,625,000
2,500,000 6.375%, 1/15/99...................................... 2,577,340
2,000,000 6.75%, 6/30/99....................................... 2,090,622
1,000,000 6.375%, 7/15/99...................................... 1,033,436
1,500,000 6.875%, 8/31/99...................................... 1,575,937
1,000,000 6.375%, 1/15/00...................................... 1,037,186
2,750,000 6.75%, 4/30/00....................................... 2,894,375
2,000,000 6.375%, 8/15/02...................................... 2,101,250
-----------
16,548,146
-----------
UNITED STATES TREASURY--
STRIPPED PRINCIPAL--1.25%
1,000,000 0.00%, 2/15/01....................................... 760,869
-----------
TOTAL U.S. GOV'T AGENCIES & OBLIGATIONS
(Cost $48,610,687) 48,757,916
-----------
PRINCIPAL MARKET
AMOUNT VALUE
--------- -----------
MORTGAGE BACKED
SECURITIES--8.44%
Federal National Mortgage Association,
$1,346,499 Pool # 195152, 7.00%, 1/1/08......................... $ 1,371,489
1,018,513 Pool # 124118, 9.00%, 3/1/22......................... 1,077,596
Government National Mortgage Association,
183,760 Pool # 204365, 9.00%, 3/15/17........................ 195,635
436,883 Pool # 780047, 9.00%, 12/15/17....................... 465,113
947,478 Pool # 354859, 9.00%, 7/15/24........................ 1,003,438
963,116 Pool # 407323, 8.25%, 4/15/25........................ 1,006,757
-----------
TOTAL MORTGAGE BACKED SECURITIES (Cost $5,077,910)... 5,120,028
-----------
COLLATERALIZED MORTGAGE OBLIGATIONS--9.27%
Federal Home Loan Mortgage Corporation,
1,436,516 Series 1317E, 7.00%, 6/15/04......................... 1,449,142
500,000 Series 1202E, 7.00%, 7/15/05......................... 511,184
500,000 Series 1467D, 6.70%, 8/15/05......................... 508,149
Federal National Mortgage Association,
2,000,000 Series 1991--137, 8.30%, 6/25/20 2,062,118
Government National Mortgage Association,
1,067,000 Series 1995-2 D, 8.50%, 11/20/15 1,094,848
-----------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS
(Cost $5,610,225).................................... 5,625,441
-----------
ASSET BACKED SECURITIES--0.11%
64,333 General Motors Acceptance Corporation, Grantor Trust
1992-E, Class A,
4.75%, 8/15/97 (Cost $64,303)........................ 64,094
-----------
REPURCHASE AGREEMENT--0.25%
153,000 Repurchase agreement with Deutsche Bank, 6.00%, due
1/2/96, repurchase price $153,102 (Collateral--
Federal Home Loan Bank Note, 6.29%, 10/20/99;
aggregate market value plus accrued interest
$158,238)
(Cost $153,000)...................................... 153,000
-----------
TOTAL INVESTMENTS--
(Cost $59,516,125)--(a) 98.45%....................... 59,720,479
Cash, receivables and other assets less liabilities--
1.55%................................................ 938,442
-----------
NET ASSETS--100.00%.................................. $60,658,921
-----------
See notes to financial statements.
(a) The cost stated also represents the aggregate cost for Federal income tax
purposes. At December 31, 1995, net unrealized appreciation was $204,354
based on cost for Federal income tax purposes. This consisted of aggregate
gross unrealized appreciation of $557,150 and aggregate gross unrealized
depreciation of $352,796.
- --------------------------------------------------------------------------------
8
<PAGE>
- --------------------------------------------------------------------------------
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
- ------
Statement of Assets and Liabilities Statement of Operations
DECEMBER 31, 1995 DECEMBER 31, 1995
- --------------------------------------------------------------------------------
ASSETS:
Investments at market value,
(Identified cost $59,516,125)................................... $59,720,479
Receivables:
Investments sold................................................ 205,991
Interest........................................................ 1,118,718
Capital stock sold.............................................. 14,238
Deferred organization costs and other assets..................... 29,224
-----------
TOTAL ASSETS.................................................... 61,088,650
-----------
LIABILITIES:
Payables:
Due to custodian................................................ 210,375
Capital stock repurchased....................................... 33,650
Dividends....................................................... 92,074
Services provided by The Bank of New York and Administrator..... 49,263
Accrued expenses and other liabilities........................... 44,367
-----------
TOTAL LIABILITIES............................................... 429,729
-----------
NET ASSETS:
(applicable to 6,102,102 shares issued and outstanding; 200
million shares of $.001 par value authorized)................... $60,658,921
-----------
Net asset value, offering price and repurchase price per share
($60,658,921/6,102,102 shares).................................. $ 9.94
-----------
Maximum public offering price per share ($9.94/.97).............. $ 10.25
-----------
SOURCES OF NET ASSETS:
Capital stock @ par.............................................. $ 6,102
Capital surplus.................................................. 62,558,550
Accumulated net realized loss on investments..................... (2,110,085)
Net unrealized appreciation on investments....................... 204,354
-----------
NET ASSETS........................................................ $60,658,921
-----------
INVESTMENT INCOME:
Interest.......................................................... $4,059,514
----------
EXPENSES:
Advisory.......................................................... 308,254
Administration.................................................... 123,302
Accounting services............................................... 60,000
Custodian......................................................... 27,959
Cash management................................................... 9,504
Transfer agent.................................................... 26,812
Audit............................................................. 11,720
Insurance......................................................... 5,761
Directors......................................................... 15,797
Reports to shareholders........................................... 8,007
Registration and filing........................................... 14,526
Legal............................................................. 17,581
Other............................................................. 23,708
----------
TOTAL EXPENSES................................................... 652,931
----------
NET INVESTMENT INCOME............................................ 3,406,583
----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--
Net realized loss on investment transactions...................... (704,447)
Increase in unrealized appreciation on investments during the
year............................................................. 6,144,249
----------
Net realized and unrealized gain on investments................... 5,439,802
----------
Net increase in net assets resulting from operations.............. $8,846,385
----------
See notes to financial statements.
- --------------------------------------------------------------------------------
9
<PAGE>
- --------------------------------------------------------------------------------
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
- ------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
------------------------
1995 1994
----------- -----------
OPERATIONS:
Net investment income............................... $ 3,406,583 $ 3,586,566
Net realized loss on investments.................... (704,447) (1,410,871)
Increase in unrealized appreciation (depreciation)
on investments during the year..................... 6,144,249 (6,070,522)
----------- -----------
Net increase (decrease) in net assets resulting
from operations................................... 8,846,385 (3,894,827)
----------- -----------
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income................ (3,406,583) (3,586,566)
----------- -----------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold.................... 10,197,215 16,386,289
Proceeds from reinvestment of dividends............. 2,247,470 2,258,630
Cost of capital stock repurchased................... (16,553,657) (23,904,747)
----------- -----------
Decrease in net assets resulting from capital stock
transactions...................................... (4,108,972) (5,259,828)
----------- -----------
INCREASE (DECREASE) IN NET ASSETS................ 1,330,830 (12,741,221)
NET ASSETS:
Beginning of year................................... 59,328,091 72,069,312
----------- -----------
End of year......................................... $60,658,921 $59,328,091
----------- -----------
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold......................................... 1,074,090 1,684,218
Shares issued on reinvestment of dividends.......... 233,341 238,683
Shares repurchased.................................. (1,726,729) (2,521,236)
----------- -----------
Net decrease....................................... (419,298) (598,335)
Shares outstanding, beginning of year............... 6,521,400 7,119,735
----------- -----------
Shares outstanding, end of year..................... 6,102,102 6,521,400
----------- -----------
See notes to financial statements.
- --------------------------------------------------------------------------------
10
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
Financial Highlights
- --------------------------------------------------------------------------------
FOR THE
PERIOD
AUGUST 10,
1992*
YEAR ENDED DECEMBER 31, THROUGH
-------------------------- DECEMBER
1995 1994 1993 31, 1992
------- ------- ------- ----------
PER SHARE DATA:
Net asset value at beginning of
period............................ $ 9.10 $ 10.12 $ 9.87 $ 10.00
------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income.............. 0.53 0.50 0.51 0.18
Net realized and unrealized gain
(loss) on investments............. 0.84 (1.02) 0.27 (0.13)
------- ------- ------- -------
Total from investment operations.. 1.37 (0.52) 0.78 0.05
------- ------- ------- -------
DIVIDENDS AND DISTRIBUTION
Dividends from net investment
income............................ (0.53) (0.50) (0.51) (0.18)
Distribution from capital gains.... -- -- (0.02) --
------- ------- ------- -------
Total dividends and distribution.. (0.53) (0.50) (0.53) (0.18)
------- ------- ------- -------
Net asset value at end of period... $ 9.94 $ 9.10 $ 10.12 $ 9.87
------- ------- ------- -------
TOTAL RETURN+...................... 15.40% (5.17)% 8.03% 0.51%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).......................... $60,659 $59,328 $72,069 $25,575
Ratio to average net assets of:
Expenses, net of waiver from The
Bank of New York................. 1.06% 1.07% 0.86% 0.75%***
Expenses, prior to waiver from The
Bank of New York................. 1.06% 1.10% 1.15% 1.64%***
Net investment income, net of
waiver from The Bank of New York. 5.52% 5.30% 5.04% 4.62%***
Portfolio turnover rate............ 48% 49% 67% 63%
* Commencement of investment operations.
** Not annualized.
*** Annualized.
+ Total return does not consider the effect of the sales load.
See notes to financial statements.
- --------------------------------------------------------------------------------
11
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Schedule of Investments
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
*MOODY'S
PRINCIPAL /S&P INTEREST MATURITY MARKET
AMOUNT RATINGS RATE DATE VALUE
--------- -------- -------- -------- -----------
[C] [S] [C] [C] [C] [C]
MUNICIPAL BONDS--96.60%
EDUCATION--10.07%
$ 235,000 Dutchess County, New York
IDA Civic Facility
Revenue, Bard College..... A/NR 6.000% 11/01/99 $ 245,516
250,000 New York State Dormitory
Authority,
Columbia University....... Aaa/AA+ 5.000 07/01/00 258,755
1,000,000 New York State Dormitory
Authority,
Cornell University........ Aa/AA 4.600 07/01/00 1,020,790
1,000,000 New York State Dormitory
Authority, New York
University, MBIA Insured+. Aaa/AAA 5.500 07/01/04 1,064,210
1,000,000 New York State Dormitory
Authority, Strong Hospital
(University of Rochester). A1/A+ 5.000 07/01/02 1,025,090
500,000 New York State Dormitory
Authority,
University of Rochester... A1/A+ 4.700 07/01/00 508,725
-----------
4,123,086
-----------
GENERAL OBLIGATION--11.25%
500,000 Monroe County, New York,
MBIA Insured+............. Aaa/AAA 4.800 06/01/02 514,450
60,000 Monroe County, New York
Series B, Unrefunded
Balance, Callable 6/01/98. A1/AA- 7.000 06/01/03 64,653
1,000,000 New York State, General
Obligation................ A/A- 4.600 03/15/01 1,009,160
1,000,000 New York State, General
Obligation................ A/A- 5.125 06/15/04 1,030,070
500,000 New York State Municipal
Bond Bank Agency
(City of Rochester)....... NR/A+ 5.750 03/15/96 502,070
500,000 New York State Municipal
Bond Bank Agency
(City of Rochester)....... NR/A+ 6.400 03/15/01 541,000
950,000 Town of New Castle, New
York
(Westchester County) ..... Aa/NR 4.000 06/01/00 943,132
-----------
4,604,535
-----------
See notes to financial statements.
- --------------------------------------------------------------------------------
12
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Schedule of Investments (Continued)
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
*MOODY'S
PRINCIPAL /S&P INTEREST MATURITY MARKET
AMOUNT RATINGS RATE DATE VALUE
--------- -------- -------- -------- ----------
MUNICIPAL BONDS (CONTINUED)
HEALTH CARE--4.53%
$ 500,000 New York State Medical Care
Facilities--
Downstate Medical Center.... NR/AAA 5.700% 02/15/04 $ 537,690
305,000 New York State Medical Care
Facilities--
Millard Fillmore Hospital
FHA......................... Aa/AA 5.600 02/15/02 316,983
1,000,000 New York State Medical Care
Facilities--
Mount Sinai Hospital FHA.... NR/AAA 4.500 02/15/96 1,001,060
----------
1,855,733
----------
HOUSING--1.24%
500,000 New York State Mortgage
Revenue Agency.............. Aa/NR 5.300 04/01/04 508,855
----------
INDUSTRIAL DEVELOPMENT BONDS--3.73%
500,000 Puerto Rico Industrial
Medical Environmental PCR,
Intel Corp., Put Option
9/01/98..................... A2/A 4.000 09/01/13 501,110
1,000,000 Westchester County
Industrial Development
Authority................... Aaa/AAA 4.850 07/01/00 1,024,780
----------
1,525,890
----------
PREREFUNDED/ESCROWED/US GUARANTEED--
4.56%
990,000 New York State Housing
Finance Agency ETM State
University Construction..... Aaa/AAA 6.500 11/01/06 1,097,266
351,000 Puerto Rico Aqueduct & Sewer
Authority ETM............... Aaa/AAA 4.200 07/01/00 349,719
415,000 Puerto Rico Aqueduct & Sewer
Authority ETM............... Aaa/AAA 4.500 07/01/02 420,914
----------
1,867,899
----------
SPECIAL TAX--14.79%
1,000,000 Municipal Assistance Corp.
Series 67................... Aa/AA- 7.200 07/01/99 1,098,900
1,000,000 New York State Local
Government Assistance Corp.. A/A 6.400 04/01/97 1,030,640
300,000 New York State Local
Government Assistance Corp.. A/A 6.700 04/01/00 327,948
1,000,000 New York State Local
Government Assistance Corp.. A/A 5.300 04/01/00 1,039,230
340,000 New York State Local
Government Assistance Corp.. A/A 6.750 04/01/02 376,397
655,000 New York State Local
Government Assistance Corp.. A/A 5.000 04/01/02 672,279
500,000 New York State Local
Government Assistance Corp.. A/A 4.800 04/01/05 499,595
1,000,000 New York State Thruway
Authority Highway & Bridge
Trust Fund.................. A/A- 4.750 04/01/98 1,008,230
----------
6,053,219
----------
See notes to financial statements.
- --------------------------------------------------------------------------------
13
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Schedule of Investments (Continued)
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
*MOODY'S
PRINCIPAL /S&P INTEREST MATURITY MARKET
AMOUNT RATINGS RATE DATE VALUE
--------- --------- -------- -------- -----------
<C> <S> <C> <C> <C> <C>
MUNICIPAL BONDS (CONTINUED)
STATE APPROPRIATION--15.78%
$ 420,000 Metropolitan Transportation Authority................ Baa1/BBB+ 5.100% 07/01/00 $ 428,459
450,000 New York State Dormitory Authority, State University. Baa1/BBB+ 7.100 05/15/98 477,275
900,000 New York State Dormitory Authority, State University. Baal/BBB+ 5.200 05/15/03 899,946
500,000 New York State Dormitory Authority, State University. Baal/BBB+ 5.500 05/15/07 503,330
1,400,000 New York State Dormitory Authority, Upstate Community
Colleges............................................. Baa1/BBB- 4.500 07/01/00 1,377,600
500,000 New York State Medical Care Facilities--Mental
Health............................................... Baa1/BBB+ 4.600 08/15/99 498,490
275,000 New York State Medical Care Facilities--Mental
Health............................................... Baa1/BBB+ 4.700 02/15/01 269,409
505,000 New York State Medical Care Facilities--Mental
Health............................................... Baa1/BBB+ 4.700 08/15/01 493,097
480,000 New York State Medical Care Facilities--Mental
Health............................................... Baa1/BBB+ 6.100 08/15/02 504,749
1,000,000 New York State Thruway Authority Service Contract.... Baa1/BBB 5.000 04/01/00 1,007,540
-----------
6,459,895
-----------
TRANSPORTATION--18.24%
625,000 New York State Thruway Authority General Revenue..... A1/A 5.125 01/01/00 643,556
1,500,000 New York State Thruway Authority General Revenue..... A1/A 5.250 01/01/01 1,552,635
1,000,000 Niagara Falls Bridge Commission Toll Revenue, FGIC
Insured+............................................. Aaa/AAA 5.000 10/01/06 1,012,250
650,000 Port Authority of New York & New Jersey.............. A1/AA- 5.100 08/01/01 673,933
500,000 Port Authority of New York & New Jersey.............. A1/AA- 6.100 10/15/02 548,185
1,000,000 Port Authority of New York & New Jersey.............. A1/AA- 5.300 08/01/03 1,048,290
500,000 Triborough Bridge & Tunnel Authority General Purpose. Aa/A+ 6.600 01/01/96 500,080
500,000 Triborough Bridge & Tunnel Authority General Purpose. Aa/A+ 4.100 01/01/01 494,430
1,000,000 Triborough Bridge & Tunnel Authority General Purpose. Aa/A+ 4.300 01/01/02 993,730
-----------
7,467,089
-----------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
14
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Schedule of Investments (Continued)
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
*MOODY'S
PRINCIPAL /S&P INTEREST MATURITY MARKET
AMOUNT RATINGS RATE DATE VALUE
--------- -------- -------- -------- -----------
MUNICIPAL BONDS (CONTINUED)
UTILITY--10.00%
$ 300,000 Great Neck North Water
Authority, New York..... A1/A- 6.900% 01/01/00 $ 329,229
250,000 New York State
Environment Facs. Corp.
State Water............. Aaa/AAA 6.000 05/15/02 271,730
500,000 New York State Envir.
Fac. Corp. PCR Water
Revol................... Aa/A- 5.100 06/15/00 518,740
400,000 New York State Envir.
Fac. Corp. PCR Water
Revol................... Aaa/AAA 6.300 09/15/00 435,356
500,000 New York State Power
Authority............... Aa/AA 7.500 01/01/02 540,115
250,000 Onondaga County, New
York Water Authority.... A1/A 6.250 01/15/98 260,515
700,000 Suffolk County Water
Authority, New York MBIA
Insured+................ Aaa/AAA 4.800 06/01/97 709,968
1,000,000 Suffolk County Water
Authority, New York MBIA
Insured+................ Aaa/AAA 4.800 06/01/00 1,025,170
-----------
4,090,823
-----------
OTHER--2.41%
340,000 New York City, Trust For
Cultural Resources
Museum MOMA--AMBAC
Insured+................ Aaa/AAA 4.900 01/01/01 349,251
240,000 New York City, Trust For
Cultural Resources
Museum MOMA--AMBAC
Insured+................ Aaa/AAA 5.000 01/01/02 247,783
350,000 New York City, Trust For
Cultural Resources
Museum MOMA--AMBAC
Insured+................ Aaa/AAA 6.300 01/01/03 387,940
-----------
984,974
-----------
TOTAL MUNICIPAL BONDS
(Cost $38,587,654)...... 39,541,998
-----------
SHORT-TERM NOTES--1.22%
500,000 Mamaroneck, New York
School District TAN
(Cost $500,215)......... NR/NR 4.000 02/06/96 500,105
-----------
TAX-EXEMPT MONEY MARKET FUND--
0.80%
325,099 Dreyfus New York
Municipal Cash
Management
(Cost $325,099)......... NR/NR 4.300(a) 325,099
-----------
TOTAL INVESTMENTS (Cost
$39,412,968)(b)--98.62%. 40,367,202
Cash, receivables, and
other assets less
liabilities--1.38%...... 563,733
-----------
NET ASSETS--100.00%..... $40,930,935
-----------
NR Not rated by Moody's or Standard & Poor's ("S&P").
TAN Tax Anticipation Note.
* Ratings are not audited by Deloitte & Touche LLP.
+ Insured or guaranteed by the indicated municipal bond insurance
corporation.
(a) Represents annualized yield at December 31, 1995.
(b) The cost stated also represents the aggregate cost for Federal
income tax purposes. At December 31, 1995, net unrealized
appreciation was $954,234 based on cost for Federal income tax
purposes. This consisted of aggregate gross unrealized
appreciation of $970,501 and aggregate gross unrealized
depreciation of $16,267.
See notes to financial statements.
- --------------------------------------------------------------------------------
15
<PAGE>
- --------------------------------------------------------------------------------
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
- ------
Statement of Assets and Liabilities Statement of Operations
DECEMBER 31, 1995 FOR THE YEAR ENDED DECEMBER 31,
1995
- --------------------------------------------------------------------------------
ASSETS:
Investments at market value,
(Identified cost $39,412,968)................................... $40,367,202
Receivables:
Investments sold................................................ 394
Interest........................................................ 693,977
Capital stock sold.............................................. 97
Deferred organization costs and other assets..................... 30,469
-----------
TOTAL ASSETS.................................................... 41,092,139
-----------
LIABILITIES:
Payables:
Capital stock repurchased....................................... 115
Dividends....................................................... 85,045
Services provided by The Bank of New York and Administrator..... 23,170
Accrued expenses and other liabilities........................... 52,874
-----------
TOTAL LIABILITIES............................................... 161,204
-----------
NET ASSETS:
(applicable to 3,959,525 shares issued and outstanding; 200
million shares of $.001 par value authorized)................... $40,930,935
-----------
Net asset value, offering price and repurchase price per share
($40,930,935/3,959,525 shares).................................. $ 10.34
-----------
Maximum public offering price per share ($10.34/.97)............. $ 10.66
-----------
SOURCES OF NET ASSETS:
Capital stock @ par.............................................. $ 3,959
Capital surplus.................................................. 40,432,433
Accumulated net realized loss on investments..................... (459,691)
Net unrealized appreciation on investments....................... 954,234
-----------
NET ASSETS........................................................ $40,930,935
-----------
INVESTMENT INCOME:
Interest.......................................................... $2,069,668
----------
EXPENSES:
Advisory.......................................................... 216,014
Administration.................................................... 86,406
Accounting services............................................... 60,000
Custodian......................................................... 16,252
Cash management................................................... 11,449
Transfer agent.................................................... 29,041
Audit............................................................. 11,415
Insurance......................................................... 4,545
Directors......................................................... 15,797
Reports to shareholders........................................... 6,026
Registration and filing........................................... 14,994
Legal............................................................. 17,123
Other............................................................. 28,122
----------
TOTAL EXPENSES................................................... 517,184
Fees waived by The Bank of New York and Administrator............. (128,360)
----------
NET EXPENSES..................................................... 388,824
----------
NET INVESTMENT INCOME............................................ 1,680,844
----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--
Net realized loss on investment transactions...................... (75,562)
Increase in unrealized appreciation on investments during the
year............................................................. 3,351,479
----------
Net realized and unrealized gain on investments................... 3,275,917
----------
Net increase in net assets resulting from operations.............. $4,956,761
----------
See notes to financial statements.
- --------------------------------------------------------------------------------
16
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
------------------------
1995 1994
----------- -----------
OPERATIONS:
Net investment income............................... $ 1,680,844 $ 2,053,601
Net realized loss on investments.................... (75,562) (375,628)
Increase in unrealized appreciation (depreciation)
on investments during the year..................... 3,351,479 (3,814,746)
----------- -----------
Net increase (decrease) in net assets resulting
from operations................................... 4,956,761 (2,136,773)
----------- -----------
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income................ (1,680,844) (2,053,601)
----------- -----------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold.................... 4,068,695 11,933,747
Proceeds from reinvestment of dividends............. 604,529 689,660
Cost of capital stock repurchased................... (10,231,201) (21,090,712)
----------- -----------
Decrease in net assets resulting from capital stock
transactions...................................... (5,557,977) (8,467,305)
----------- -----------
DECREASE IN NET ASSETS........................... (2,282,060) (12,657,679)
NET ASSETS:
Beginning of year................................... 43,212,995 55,870,674
----------- -----------
End of year......................................... $40,930,935 $43,212,995
----------- -----------
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold......................................... 410,516 1,184,457
Shares issued on reinvestment of dividends.......... 59,793 69,568
Shares repurchased.................................. (1,014,728) (2,136,537)
----------- -----------
Net decrease....................................... (544,419) (882,512)
Shares outstanding, beginning of year............... 4,503,944 5,386,456
----------- -----------
Shares outstanding, end of year..................... 3,959,525 4,503,944
----------- -----------
See notes to financial statements.
- --------------------------------------------------------------------------------
17
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Financial Highlights
- --------------------------------------------------------------------------------
FOR THE
PERIOD
AUGUST 10,
1992*
YEAR ENDED DECEMBER 31, THROUGH
--------------------------- DECEMBER
1995 1994 1993 31, 1992
---- ---- --------- ----------
PER SHARE DATA:
Net asset value at beginning of
period........................ $ 9.59 $ 10.37 $ 9.97 $ 10.00
--------- --------- --------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.......... 0.39 0.39 0.38 0.15
Net realized and unrealized
gain (loss) on investments.... 0.75 (0.78) 0.40 (0.03)+
--------- --------- --------- -------
Total from investment
operations................... 1.14 (0.39) 0.78 0.12
--------- --------- --------- -------
DIVIDENDS
Dividends from net investment
income........................ (0.39) (0.39) (0.38) (0.15)
--------- --------- --------- -------
Net asset value at end of
period........................ $ 10.34 $ 9.59 $ 10.37 $ 9.97
--------- --------- --------- -------
TOTAL RETURN++................. 12.08% (3.81)% 7.99% 1.18%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period
(000's omitted)............... $40,931 $43,213 $55,871 $19,717
Ratio to average net assets of:
Expenses, net of waiver from
The Bank of New York and
Administrator................ 0.90% 0.85% 0.68% 0.60%***
Expenses, prior to waiver from
The Bank of New York and
Administrator................ 1.20% 1.20% 1.30% 1.96%***
Net investment income, net of
waiver from The Bank
of New York and
Administrator................ 3.89% 3.92% 3.74% 3.79%***
Portfolio turnover rate........ 4% 18% 6% --
* Commencement of investment operations.
** Not annualized.
*** Annualized.
+ The amount shown is not in accordance with the change in the aggregate gains
and losses of the portfolio securities during the period August 10, 1992
through December 31, 1992 due to the timing of sales and repurchases of
shares of the Fund.
++Total return does not consider the effect of the sales load.
See notes to financial statements.
- --------------------------------------------------------------------------------
18
<PAGE>
- --------------------------------------------------------------------------------
- ------
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND BUSINESS
The BNY Hamilton Funds, Inc. (the "Company") was organized as a Maryland Cor-
poration on May 1, 1992 and is registered under the Investment Company Act of
1940 as an open-end management investment company. The Company currently con-
sists of four series: BNY Hamilton Money Fund (not included herein), BNY Hamil-
ton Equity Income Fund, BNY Hamilton Intermediate Government Fund and BNY Ham-
ilton Intermediate New York Tax-Exempt Fund (individually, a "Fund" and collec-
tively, the "Funds").
2. SIGNIFICANT ACCOUNTING POLICIES
(A) SECURITY VALUATIONS
BNY Hamilton Equity Income Fund (the "Equity Income Fund")
Securities listed on a domestic securities exchange, including options on
stock indexes, are valued based on the last sale price as of the close of regu-
lar trading hours on the New York Stock Exchange or, in the absence of recorded
sales, at the average of readily available closing bid and asked prices on such
exchange. Securities listed on a foreign exchange are valued at the last quoted
sale price available before the time when net assets are valued. Unlisted secu-
rities traded only on the over the counter market are valued at the average of
the quoted bid and asked prices in the over-the-counter market.
The market value of a written call option or a purchased put option is the
last reported sale price on the principal exchange on which such option is
traded or, if no sales are reported, the average between the last reported bid
and asked prices.
BNY Hamilton Intermediate Government Fund (the "Intermediate Government
Fund") and BNY Hamilton Intermediate New York Tax-Exempt Fund (the "Inter-
mediate New York Tax-Exempt Fund")
Securities are valued using prices supplied daily by an independent pricing
service or services that (l) are based on the last sale price on a national se-
curities exchange, or in the absence of recorded sales, at the readily avail-
able closing bid price on such exchange or at the quoted bid price in the over-
the-counter market, if such exchange or market constitutes the broadest and
most representative market for the security, and (2) in other cases, take into
account various factors affecting market value, including yields and prices of
comparable securities, indications as to value from dealers and general market
conditions.
Portfolio securities with a remaining maturity of 60 days or less are valued
using the amortized cost method for all Funds.
Securities for which market quotations are not readily available are valued at
fair value in accordance with procedures established by and under the general
supervision and responsibility of the Board of Directors for all Funds.
(B) REPURCHASE AGREEMENTS
The Funds' custodian or designated sub-custodians, as the case may be under
tri-party repurchase agreements, takes possession of the collateral pledged for
investments in repurchase agreements. The underlying collateral is valued daily
on a mark-to-market basis to ensure that the value, including accrued interest,
is at least equal to the repurchase price. In the event of default of the obli-
gation to repurchase, the Funds have the right to liquidate the collateral and
apply the proceeds in satisfaction of the obligations. Under certain circum-
stances, in the event of default or bankruptcy by the other party to the agree-
ment, realization and/or retention of the collateral may be subject to legal
proceedings.
(C) WRITTEN OPTIONS AND PURCHASED OPTIONS
The Equity Income Fund enters into an option contract for the purpose of ei-
ther hedging its exposure to the market fluctuations of the portfolio, or
- --------------------------------------------------------------------------------
19
<PAGE>
- --------------------------------------------------------------------------------
- ------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
an individual security position. The nature and risks associated with these se-
curities are explained further in the Prospectus and Statement of Additional
Information.
When the Equity Income Fund writes a call option, it will receive a premium.
Premiums received are recorded as liabilities and adjusted to current market
value daily. When a put option is purchased, the Equity Income Fund will pay a
premium. Premiums paid for put options are included as investments and are also
adjusted to their current market value daily.
If a written call expires, the premium received by the Equity Income Fund will
be treated as a short term capital gain. Likewise, premiums paid for purchased
put options that expire unexercised will be treated as short term capital loss-
es. In addition, short term capital gains or losses may be realized on exer-
cised written calls or purchased puts depending on the premiums received or
paid and the strike price of the underlying securities.
As a writer of call options, the Equity Income Fund may not have control over
the exercising of such options. As a result, the Equity Income Fund bears un-
limited market risk of favorable changes in the value of the call option's un-
derlying securities. The Equity Income Fund also bears unlimited market risk in
the value of the written call option itself.
If an option which the Equity Income Fund has purchased expires on its stipu-
lated expiration date, the Equity Income Fund realizes a loss in the amount of
the cost of the option. If the Equity Income Fund enters into a closing trans-
action, it realizes a gain or loss, depending on whether the proceeds from the
sale are greater or less than the cost of the option. If the Equity Income Fund
exercises a put option, it realizes a gain or loss from the sale of the under-
lying security and the proceeds from such sale will be decreased by the premium
originally paid. If the Equity Income Fund exercises a call option, the cost of
the security which the Equity Income Fund purchases upon exercise will be in-
creased by the premium originally paid.
(D) FEDERAL INCOME TAXES
Each Fund is treated as a separate entity for federal income tax purposes. The
Funds' policy is to comply with the requirements of the Internal Revenue Code
applicable to regulated investment companies and distribute all of the taxable
and tax exempt income to the shareholders within the allowable time limits.
Therefore, no federal income tax provision is required.
(E) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
The Intermediate Government Fund and the Intermediate New York Tax-Exempt Fund
declare dividends daily and pay dividends monthly. The Equity Income Fund de-
clares and pays dividends monthly.
Income and capital gains distributions are determined in accordance with in-
come tax regulations which may differ from methods used to determine the corre-
sponding income and capital gain amounts in accordance with generally accepted
accounting principles. These differences are primarily caused by differences in
the timing of the recognition of certain components of income, expense, or cap-
ital gain. Where such differences are permanent in nature, they are reclassi-
fied in the Sources of Net Assets based upon their ultimate characterization
for Federal income tax purposes. Any such reclassifications will have no effect
on net assets, results of operations, or net asset value of each Fund.
(F) SECURITY TRANSACTIONS AND INVESTMENT INCOME
Security transactions are recorded on the trade date. Realized gains and
losses on security transactions are determined using the identified cost meth-
od. Dividend income is recognized on the ex-dividend date and interest income
is accrued daily. Discounts on securities purchased for all Funds except for
the Intermediate New York Tax-Exempt Fund and premiums on securities purchased
for the Intermediate New York Tax-Exempt Fund are amortized.
- --------------------------------------------------------------------------------
20
<PAGE>
- --------------------------------------------------------------------------------
- ------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(G) ORGANIZATION COSTS
Costs incurred in connection with the organization and initial registration of
the Funds are being amortized evenly over the period of benefit not to exceed
60 months from the date upon which each of the Funds commenced investment
operations.
3. ADVISORY, ADMINISTRATION AND OTHER TRANSACTIONS WITH AFFILIATES
The Bank of New York acts as the Funds' investment adviser (the "Adviser").
The Adviser manages the investments of the Funds and is responsible for all
purchases and sales of the Funds' portfolio securities. The Adviser's fee ac-
crues daily and is payable monthly at the following annual rates:
% OF AVERAGE
DAILY NET ASSETS
----------------
Equity Income Fund............................................. .60%
Intermediate Government Fund .50%
Intermediate New York Tax-Exempt Fund.......................... .50%
BNY Hamilton Distributors, Inc. acts as the Funds' administrator (the "Admin-
istrator") and will assist generally in supervising the operations of the
Funds.
The Administrator has agreed to provide facilities, equipment and personnel to
carry out administrative services for the Funds, including, among other things,
providing the services of persons who may be appointed as officers and direc-
tors of the Funds, monitoring the custodian, fund accounting, transfer agency,
administration, distribution, advisory and legal services that are provided to
the Funds.
The Administrator's fee is accrued daily and is payable monthly computed util-
izing the following annual rates:
% OF AVERAGE
DAILY NET ASSETS
----------------
Equity Income Fund............................................. .20%
Intermediate Government Fund .20%
Intermediate New York Tax-Exempt Fund.......................... .20%
In addition to acting as Administrator, BNY Hamilton Distributors, Inc. is the
principal underwriter and distributor of shares of the Funds.
The Bank of New York serves as the Funds' custodian and also serves as the
fund accounting agent.
The Bank of New York and the Administrator have voluntarily agreed to
assume/waive expenses for the Intermediate New York Tax-Exempt Fund to the ex-
tent that expenses for that Fund exceeded .90% of average daily net assets.
There is currently no reimbursement of expenses with respect to the Equity In-
come Fund and the Intermediate Government Fund.
The Company has adopted a distribution plan (The "12b-1 Plans") with respect
to each Fund. Under the 12b-1 Plans, the Funds will pay the Distributor for
distribution expenses incurred in connection with sales of shares of the Funds.
Payments for distribution expenses may not exceed .25% of each Fund's average
daily net assets. The Funds have not implemented the 12b-1 Plans since their
commencement of investment operations, and therefore no amounts have been ac-
crued for such fees in the accompanying financial statements.
4. PORTFOLIO SECURITIES
During the year ended December 31, 1995, the cost of purchases and the pro-
ceeds from sales of securities, other than short-term securities, were as fol-
lows:
EQUITY
INCOME FUND
-----------------------
PURCHASES SALES
----------- -----------
US Gov't Securities..................................... $ -- $ --
All Others.............................................. 87,087,927 81,212,081
INTERMEDIATE
GOVERNMENT FUND
-----------------------
PURCHASES SALES
----------- -----------
US Gov't Securities..................................... $27,548,620 $28,713,238
All Others.............................................. -- 87,251
- --------------------------------------------------------------------------------
21
<PAGE>
- --------------------------------------------------------------------------------
- ------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
INTERMEDIATE
NEW YORK
TAX-EXEMPT FUND
--------------------
PURCHASES SALES
--------- ----------
US Gov't Securities........................................ $ -- $ --
All Others................................................. 1,740,993 8,601,443
5. FEDERAL INCOME TAXES
For federal income tax purposes, the Funds indicated below have capital loss
carryforwards as of December 31, 1995 which are available to offset future
capital gains, if any. Accordingly, no capital gains distribution is expected
to be paid to shareholders until net gains have been realized in excess of such
amounts.
CAPITAL LOSS
CARRYFORWARD EXPIRATION
------------ ----------
Intermediate Government Fund........................... $1,358,600 2002
681,600 2003
Intermediate New York Tax-Exempt Fund.................. 2,900 2000
5,600 2001
377,300 2002
91,500 2003
6. WRITTEN OPTION ACTIVITY
Transactions in written options during the year ended December 31, 1995 were
as follows:
AMOUNT OF NUMBER OF
PREMIUMS OPTIONS
------------ ---------
EQUITY INCOME FUND:
Options outstanding at
December 31, 1994...... $ 167,007 475
Options written during
the year ended December
31, 1995............... 2,131,248 2,565
Options terminated in
closing purchase
transactions........... (1,702,715) (2,935)
Options exercised....... -- --
------------ -------
Options outstanding at
December 31, 1995...... $ 595,540 105
------------ -------
The cost of cancelling options in closing purchase transactions was $2,178,466,
resulting in a net-short term capital loss of $475,751.
- --------------------------------------------------------------------------------
22
<PAGE>
- --------------------------------------------------------------------------------
- ------
REPORT OF INDEPENDENT ACCOUNTANTS
The Shareholders and Board of Directors of
BNY Hamilton Funds, Inc. (BNY Hamilton Equity Income Fund, BNY Hamilton Inter-
mediate
Government Fund, and BNY Hamilton Intermediate New York Tax-Exempt Fund):
We have audited the accompanying statements of assets and liabilities,
including the schedules of investments, of BNY Hamilton Funds, Inc. (BNY
Hamilton Equity Income Fund, BNY Hamilton Intermediate Government Fund, and BNY
Hamilton Intermediate New York Tax-Exempt Fund) as of December 31, 1995, the
related statements of operations for the year then ended and of changes in net
assets for each of the two years in the period then ended, and the financial
highlights for each of the three years in the period then ended and for the
period August 10, 1992 (commencement of investment operations) to December 31,
1992. These financial statements and financial highlights are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at
December 31, 1995 by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of BNY
Hamilton Funds, Inc. (BNY Hamilton Equity Income Fund, BNY Hamilton
Intermediate Government Fund, and BNY Hamilton Intermediate New York Tax-Exempt
Fund) as of December 31, 1995, the results of their operations, the changes in
their net assets and the financial highlights for the respective stated
periods, in conformity with generally accepted accounting principles.
Deloitte & Touche llp
New York, New York
February 9, 1996
- --------------------------------------------------------------------------------
FEDERAL INCOME TAX INFORMATION (UNAUDITED)
For federal income tax purposes, 65.53% of the ordinary income dividends paid
to you during the year ended December 31, 1995 for the BNY Hamilton Equity In-
come Fund qualify for the corporate dividend deduction under section 243 of the
Internal Revenue Code.
Dividends paid to shareholders of the BNY Hamilton Intermediate New York Tax-
Exempt Fund are 100% exempt from federal, New York State and New York City in-
come tax.
- --------------------------------------------------------------------------------
23
<PAGE>
- --------------------------------------------------------------------------------
- ------
DIRECTORS AND OFFICERS
Eugene Sullivan, Director and Chairman of the Board
Peter Herrick, Director
Leif H. Olsen, Director
Stephen Stamas, Director
Edward L. Gardner, Director
Richard E. Stierwalt, Chief Executive Officer
William B. Blundin, President
Ann E. Bergin, Vice President
William J. Tomko, Vice President
Martin Dean, Treasurer
George Martinez, Secretary
Karen Doyle, Assistant Treasurer
Robert L. Tuch, Assistant Secretary
Alaina Metz, Assistant Secretary
INVESTMENT ADVISER
The Bank of New York
ADMINISTRATOR AND DISTRIBUTOR
BNY Hamilton Distributors, Inc.
TRANSFER AGENT
BISYS Fund Services, Inc.
CUSTODIAN
The Bank of New York
INDEPENDENT ACCOUNTANTS
Deloitte & Touche llp
LEGAL COUNSEL
Sullivan & Cromwell
- --------------------------------------------------------------------------------
24
<PAGE>
BNY HAMILTON FUNDS
ANNUAL REPORT DECEMBER 31, 1995
. EQUITY INCOME FUND
. INTERMEDIATE GOVERNMENT FUND
. INTERMEDIATE NEW YORK TAX-EXEMPTFUND
(ART)
BNY HAMILTON DISTRIBUTORS, INC. IS THE FUNDS' DISTRIBUTOR AND IS UNAFFILIATED
WITH THE BANK OF NEW YORK, THE INVESTMENT ADVISER.
This report is not authorized for distribution to prospective investors unless
preceded or accompanied by a current prospectus for the Equity Income Fund,
Intermediate Government Fund, or Intermediate New York Tax-Exempt Fund. For ad-
ditional prospectuses, which contain more complete information, including
charges and expenses, call 1-800-426-9363. Please read the prospectus carefully
before investing or sending money.
BNY HAMILTON FUNDS, INC.
3435 Stelzer Road
Columbus, Ohio, 43219-3035
INVESTMENTS IN THE FUNDS ARE NOT DEPOSITS, ARE NEITHER GUARANTEED BY NOR OBLI-
GATIONS OF THE BANK OF NEW YORK AND ARE NOT INSURED BY THE FDIC OR ANY OTHER
GOVERNMENTAL AGENCY. INVESTMENTS IN MUTUAL FUNDS INVOLVE RISKS, INCLUDING THE
POSSIBLE LOSS OF PRINCIPAL.
BNYEB95A
<PAGE>
- --------------------------------------------------------------------------------
- ------
CHAIRMAN'S LETTER
January 17, 1996
DEAR SHAREHOLDER:
The BNY Hamilton Funds are pleased to provide you with the annual report for
1995. Growth in the Money Fund was strong. Net assets increased 176% to finish
the year at $947 million.
At year-end 1995, the 7-day current yield for the Hamilton Class of the BNY
Hamilton Money Fund was 5.49%. The full year total return was 5.84%. For the
Premier Class, the 7-day current yield at year-end was 5.22% and the full year
total return was 5.54%. The 7-day current yield for the Classic Class, which
was opened on December 4th, was 4.99% at year-end.*
Overnight repurchase agreements which were collateralized by U.S. Treasury
and Agency securities and commercial paper represented the largest asset sec-
tors in the Fund at year end. Analysis of interest rate trends, Federal Reserve
policy, supply and demand conditions in the money markets and spread relation-
ships are used to determine asset composition and maturities selection.
The Federal Funds rate began and ended 1995 at the 5.50% level. After one fi-
nal tightening measure to head off inflation pressures in February, the Federal
Reserve began easing monetary policy gradually during the second half of the
year in recognition of softening economic activity. According to Kevin J.
Bannon, Chief Investment Officer at The Bank of New York (Investment Advisor),
"We expect the Federal Reserve to pursue a more aggressive easing of monetary
policy in 1996." The Bank projects a year of continuing moderate economic
growth of approximately 2.0% and low inflation of approximately 2.5% with the
primary risks to this forecast leaning in the direction of lower versus higher
rates.
The Funds are pleased to announce the creation of a new class of shares, Ham-
ilton Classic Shares. The new class, started on December 4th to serve individ-
ual investors, provides a wider distribution network for the Fund.
The BNY Hamilton Money Fund maintains a "AAAm" rating by Standard and Poor's.
According to Standard and Poor's, this rating is historical and based upon the
Fund's credit quality, market price exposure and management. The rating signi-
fies that the Fund's safety is excellent and that it has a superior capacity to
maintain its $1.00 net asset value per share. Additionally, the Fund is listed
on the National Association of Insurance Commissioners (NAIC) approved list of
Class 1 Money Market Funds.
I would like to welcome all new BNY Hamilton Money Fund shareholders in the
Hamilton Class, Hamilton Premier Class, and Hamilton Classic Class and thank
all our existing shareholders for your investment in the Fund.
Sincerely,
/s/ Eugene J. Sullivan
Eugene Sullivan
Chairman of the Board
- --------
* Yields will fluctuate with market conditions. Past performance is no guaran-
tee of future results. Investments in money market funds are not insured or
guaranteed by the U.S. Government and there is no assurance the Fund will be
able to maintain a stable net asset value of $1.00 per share.
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
- ------
TABLE OF CONTENTS
<TABLE>
<S> <C>
SCHEDULE OF INVESTMENTS.................................................. Page 1
STATEMENT OF ASSETS AND LIABILITIES...................................... 5
STATEMENT OF OPERATIONS.................................................. 5
STATEMENTS OF CHANGES IN NET ASSETS...................................... 6
FINANCIAL HIGHLIGHTS..................................................... 7
NOTES TO FINANCIAL STATEMENTS............................................ 8
REPORT OF INDEPENDENT ACCOUNTANTS........................................ 10
DIRECTORS AND OFFICERS................................................... 11
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON MONEY FUND
Schedule of Investments
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT MARKET VALUE
--------- ------------
<C> <S> <C>
COMMERCIAL PAPER--24.62%
ASSET BACKED SECURITIES--TRADE & LEASE RECEIVABLES
(PARTIAL SUPPORT)--6.22%
$15,200,000 Ciesco L.P., 5.55%+, 3/6/96........................ $ 15,047,683
12,000,000 Ford Credit Receivables Funding, 5.72%+, 1/2/96.... 11,998,093
20,000,000 Matterhorn Capital Corp., 5.74%+, 1/18/96.......... 19,945,789
12,000,000 Sceptre International Ltd., 5.70%+, 1/22/96........ 11,960,100
------------
58,951,665
------------
BANK HOLDING COMPANIES--1.26%
12,000,000 Chase Manhattan Corp., 5.60%+, 3/5/96.............. 11,880,533
------------
BANKS--DOMESTIC INDUSTRIES--0.84%
8,000,000 Norwest Corp., 5.55%+, 2/16/96..................... 7,943,267
------------
BANKS--FOREIGN INSTITUTIONS--2.52%
10,000,000 Chiao Tung Bank Co., Ltd., 5.70%+, 1/29/96......... 9,955,667
10,000,000 Royal Bank of Canada, 5.70%+, 1/29/96.............. 9,955,667
4,000,000 Toronto Dominion Holdings U.S.A., 5.60%+, 4/25/96.. 3,928,444
------------
23,839,778
------------
BROKERAGE SERVICES--3.15%
15,000,000 Lehman Brothers, Inc. 5.93%+, 1/4/96............... 14,992,587
15,000,000 Merrill Lynch & Company, Inc., 5.65%+, 3/29/96..... 14,792,833
------------
29,785,420
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT MARKET VALUE
--------- ------------
<C> <S> <C>
ELECTRICAL & ELECTRONIC EQUIPMENT--1.57%
$15,000,000 Avnet Inc., 5.65%+, 2/12/96........................ $ 14,901,125
------------
FINANCE COMPANIES--NON-CAPTIVE AND INDEPENDENT--
3.15%
10,000,000 General Electric Capital Corp., 5.50%+, 4/1/96..... 9,860,972
20,000,000 Transamerica Corp., 5.77%+, 1/5/96................. 19,987,178
------------
29,848,150
------------
FINANCIAL SERVICES--OTHER CREDIT INSTITUTIONS--
1.26%
12,000,000 International Lease Finance Corp., 5.72%+, 1/17/96. 11,969,493
------------
FOOD PROCESSING--0.41%
4,000,000 McCormick & Co., Inc., 5.56%%+, 4/30/96............ 3,925,867
------------
LEASING (WHOLESALE & RETAIL)--AUTOS, TRUCKS, &
RV'S--1.78%
10,000,000 Ford Motor Credit Co., 5.50%+, 4/1/96.............. 9,860,972
7,000,000 Hertz Corp., 5.76%+, 1/10/96....................... 6,989,920
------------
16,850,892
------------
PHARMACEUTICALS, HEALTH CARE, COSMETICS & SOAP--
0.89%
8,500,000 Sandoz, 5.68%+, 2/5/96............................. 8,453,061
------------
UTILITIES--1.57%
5,000,000 National Rural Utilities Cooperative Finance Corp.,
5.60%+, 2/16/96.................................... 4,964,222
10,000,000 National Rural Utilities Cooperative Finance Corp.,
5.63%+, 2/28/96.................................... 9,909,294
------------
14,873,516
------------
TOTAL COMMERCIAL PAPER
(Cost $233,222,767)................................ 233,222,767
------------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
1
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON MONEY FUND
Schedule of Investments (Continued)
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
--------- ------------
<C> <S> <C>
U.S. GOV'T AGENCIES & OBLIGATIONS--20.39%
UNITED STATES GOVERNMENT AGENCY SECURITIES--18.49%
Federal Farm Credit Bank,
$10,000,000 5.66%, 2/1/96....................................... $ 9,999,210
6,000,000 5.67%, 7/17/96...................................... 6,000,000
15,300,000 5.75%, 8/1/96....................................... 15,297,823
2,000,000 5.60%, 11/1/96...................................... 1,998,830
Federal Home Loan Bank,
15,345,000 5.49%+, 2/26/96..................................... 15,213,954
7,500,000 5.71%, 8/9/96....................................... 7,498,409
7,000,000 5.84%, 10/3/96...................................... 7,000,000
5,000,000 5.89%, 10/18/96..................................... 5,000,000
Federal Home Loan Mortgage Corporation,
12,000,000 5.52%+, 2/20/96..................................... 11,908,000
17,000,000 5.47%+, 3/1/96...................................... 16,845,017
8,000,000 5.44%+, 3/4/96...................................... 7,923,840
Federal National Mortgage Association,
10,000,000 5.48%+, 2/8/96...................................... 9,942,156
10,000,000 5.44%+, 3/6/96...................................... 9,901,778
10,000,000 5.51%+, 3/8/96...................................... 9,897,453
5,000,000 5.60%, 9/20/96...................................... 4,999,156
5,000,000 5.64%, 10/2/96...................................... 4,995,266
9,000,000 5.68%, 10/7/96...................................... 8,998,792
5,000,000 5.13%+, 10/30/96.................................... 4,784,113
10,000,000 5.60%, 11/1/96...................................... 9,989,234
7,000,000 5.47%, 11/14/96..................................... 6,997,358
------------
175,190,389
------------
UNITED STATES TREASURY NOTES--1.90%
14,000,000 5.50%, 4/30/96...................................... 13,995,962
4,000,000 5.875%, 5/31/96..................................... 4,000,375
------------
17,996,337
------------
TOTAL U.S. GOV'T AGENCIES & OBLIGATIONS
(Cost $193,186,726)................................. 193,186,726
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
--------- ------------
<C> <S> <C>
FLOATING RATE NOTES--5.78%
BANK HOLDING COMPANIES
--1.27%
$12,000,000 American Express Centurion Bank, 5.9075%, payable
monthly, interest resets monthly, next interest
reset date 1/16/96, final maturity 10/16/96 (a).... $ 11,997,157
------------
BROKERAGE SERVICES--2.11%
7,000,000 Bear Stearns Companies Inc., 6.02%, payable
monthly, interest resets monthly, next interest
reset date 1/24/96, final maturity 5/24/96 (a)..... 7,005,089
13,000,000 Bear Stearns Companies Inc., 6.02%, payable
monthly, interest resets weekly, next interest
reset date 1/2/96, final maturity 10/3/96 (a)...... 13,000,000
------------
20,005,089
------------
UNITED STATES GOVERNMENT AGENCY SECURITIES--2.40%
10,000,000 Federal Farm Credit Bank, 5.84%, payable quarterly,
interest resets weekly, next interest reset date
1/3/96, final maturity 11/8/96 (a)................. 9,990,672
7,000,000 Student Loan Marketing Association, 5.25%, payable
semi-annually, interest resets weekly, next
interest reset date 1/3/96, final maturity
3/14/96 (a)........................................ 7,000,000
5,795,000 Student Loan Marketing Association, 5.40%, payable
quarterly, interest resets weekly, next interest
reset date 1/3/96, final maturity 3/20/96 (a)...... 5,797,717
------------
22,788,389
------------
TOTAL FLOATING RATE NOTES
(Cost $54,790,635)................................. 54,790,635
------------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
2
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON MONEY FUND
Schedule of Investments (Continued)
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
--------- ------------
<C> <S> <C>
TIME DEPOSITS--5.02%
$20,000,000 Comerica Bank, Detroit, 5.875%, 1/2/96............. $ 20,000,000
27,556,000 Huntington National Bank, 5.375%, 1/2/96........... 27,556,000
------------
TOTAL TIME DEPOSITS
(Cost $47,556,000)................................. 47,556,000
------------
CERTIFICATE OF DEPOSIT--FOREIGN INSTITUTIONS
--1.90%
6,000,000 Commerzbank, 5.74%, 2/6/96......................... 6,000,146
12,000,000 Westdeutsche Landesbank Girozentrale, 5.60%,
5/15/96 12,000,000
------------
TOTAL CERTIFICATE OF DEPOSIT--FOREIGN INSTITUTIONS
(Cost $18,000,146)................................. 18,000,146
------------
FIXED RATE DEBT OBLIGATIONS--1.26%
ASSET BACKED SECURITIES--OTHER ASSET BACKED
PROGRAMS--0.43%
4,040,283 Navistar Financial Corp., 5.75%, 11/15/96.......... 4,040,226
------------
BANK HOLDING COMPANIES
--0.83%
7,910,000 Nationsbank Corp., 4.75%, 8/15/96.................. 7,853,009
------------
TOTAL FIXED RATE DEBT OBLIGATIONS
(Cost $11,893,235)................................. 11,893,235
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
--------- ------------
<C> <S> <C>
REPURCHASE AGREEMENTS
--41.17%
REPURCHASE AGREEMENTS WITH BARCLAYS, DEZOETE--9.50%
$90,000,000 6.00%, due 1/2/96,
repurchase price $90,060,000 (Collateral--Federal
Home Loan Mortgage Corporation Bonds, 6.40%-9.00%,
10/15/00-11/1/24; Federal National Mortgage
Association Bonds, 5.00%-8.00%, 8/1/01-8/25/21;
aggregate market value plus accrued interest
$92,700,001) (Cost $90,000,000).................... $ 90,000,000
------------
REPURCHASE AGREEMENTS WITH DEAN WITTER REYNOLDS,
INC.
--8.45%
80,000,000 5.95%, due 1/2/96,
repurchase price $80,052,889
(Collateral--United States Treasury Notes, 5.625%-
8.25%, 8/31/97-7/15/98; Federal Home Loan Mortgage
Corporation Bonds, 5.60%-9.00%, 11/15/06-3/15/24;
Federal National Mortgage Association Bonds, 6.00%-
8.00%, 9/25/07-11/25/21; aggregate market value
plus accrued interest $82,380,077) (Cost
$80,000,000)....................................... 80,000,000
------------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
3
<PAGE>
- --------------------------------------------------------------------------------
- ------
BNY HAMILTON MONEY FUND
Schedule of Investments (Continued)
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
--------- ------------
<C> <S> <C>
REPURCHASE AGREEMENTS WITH DEUTSCHE BANK--9.50%
$90,000,000 6.00%, due 1/2/96,
repurchase price $90,060,000
(Collateral--Federal Home Loan Bank Notes including
Zero Coupon Notes, 0.00%-6.91%, 12/18/96-11/6/00;
Federal Home Loan Mortgage Corporation Bonds,
7.35%-8.115%, 1/31/05-3/22/05; Federal National
Mortgage Association Bonds including Zero Coupon
Notes, 0.00%-6.85%, 10/1/97-8/22/05; aggregate
market value plus accrued interest $91,802,944)
(Cost $90,000,000)................................. $ 90,000,000
------------
REPURCHASE AGREEMENTS WITH GOLDMAN SACHS & CO.--
7.39%
70,000,000 5.95%, due 1/2/96,
repurchase price $70,046,278 (Collateral--World
Bank Zero Coupon Note, 2/29/96; aggregate market
value $71,401,086)
(Cost $70,000,000)................................. 70,000,000
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
--------- ------------
<C> <S> <C>
REPURCHASE AGREEMENTS WITH MORGAN STANLEY GROUP,
INC.--
6.33%
$60,000,000 5.90%, due 1/2/96,
repurchase price $60,039,333
(Collateral--United States Treasury Bond, 7.50%,
11/15/16; Federal National Mortgage Association
Bonds, 5.677%-6.50%, 3/25/22-11/1/25; aggregate
market value plus accrued interest $62,089,280)
(Cost $60,000,000)................................ $ 60,000,000
------------
TOTAL REPURCHASE AGREEMENTS
(Cost $390,000,000)............................... 390,000,000
------------
TOTAL INVESTMENTS--
(Cost $948,649,509)(b)--100.14%................... 948,649,509
Liabilities in excess of cash, receivables and
other assets--(0.14%)............................. (1,335,515)
------------
NET ASSETS--100%.................................. $947,313,994
------------
</TABLE>
(a) The rate stated is the rate in effect as of December 31, 1995.
(b) The cost stated also represents the aggregate cost for Federal income tax
purposes.
+ Represents yield at time of purchase for commercial paper holdings, and dis-
counted rate at time of purchase for U.S. Government agency securities.
See notes to financial statements.
- --------------------------------------------------------------------------------
4
<PAGE>
- --------------------------------------------------------------------------------
- ------
Statement of Assets
and Statement of Operations
Liabilities
DECEMBER 31, 1995 FOR THE YEAR ENDED DECEMBER 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at market value, including repurchase agreements of
$390,000,000 (Identified cost $948,649,509)...................... $948,649,509
Interest receivable............................................... 2,283,387
Deferred organization costs and other assets...................... 51,182
------------
TOTAL ASSETS..................................................... 950,984,078
------------
LIABILITIES:
Payables:
Dividends: Hamilton Shares....................................... 2,482,955
Hamilton Premier
Shares............................................................. 642,708
Hamilton Classic
Shares............................................................. 565
Services provided by The Bank of New York and Administrator...... 261,994
Due to custodian................................................. 214,061
Accrued expenses and other liabilities............................ 67,801
------------
TOTAL LIABILITIES................................................ 3,670,084
------------
NET ASSETS:
(applicable to shares issued and outstanding; 9 billion shares of
$.001 par value authorized)...................................... $947,313,994
------------
SOURCES OF NET ASSETS:
Capital stock @ par............................................... $ 947,314
Capital surplus................................................... 946,366,680
------------
NET ASSETS......................................................... $947,313,994
------------
HAMILTON SHARES:
Net asset value, offering price and redemption price per share
($604,052,506/604,052,506 shares)................................ $ 1.00
------------
HAMILTON PREMIER SHARES:
Net asset value, offering price and redemption price per share
($340,163,096/340,163,096 shares)................................ $ 1.00
------------
HAMILTON CLASSIC SHARES:
Net asset value, offering price and redemption price per share
($3,098,392/3,098,392 shares).................................... $ 1.00
------------
</TABLE>
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest........................................................... $40,236,274
-----------
EXPENSES:
Advisory........................................................... 677,980
Administration..................................................... 677,980
12b-1 fee--Hamilton Classic Shares................................. 331
Servicing fee--Hamilton Premier Shares............................. 608,722
Servicing fee--Hamilton Classic Shares............................. 331
Accounting services................................................ 60,000
Cash management: Hamilton Shares................................... 8,852
Hamilton Premier Shares.................................... 29,910
Custodian.......................................................... 109,071
Transfer agent: Hamilton Shares.................................... 18,046
Hamilton Premier Shares...................................... 57,393
Audit.............................................................. 26,244
Insurance.......................................................... 36,564
Directors'......................................................... 15,797
Reports to shareholders............................................ 17,602
Registration and filing............................................ 19,602
Legal.............................................................. 25,603
Other.............................................................. 49,345
-----------
TOTAL EXPENSES.................................................... 2,439,373
-----------
NET INVESTMENT INCOME............................................. $37,796,901
-----------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
5
<PAGE>
- --------------------------------------------------------------------------------
- ------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------
1995 1994
--------------- ---------------
<S> <C> <C>
OPERATIONS:
Net investment income....................... $ 37,796,901 $ 13,920,482
--------------- ---------------
Net increase in net assets resulting from
operations................................ 37,796,901 13,920,482
--------------- ---------------
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income:
Hamilton Shares............................ (24,629,959) (12,120,782)
Hamilton Premier Shares...................... (13,159,984) (1,799,700)
Hamilton Classic Shares...................... (6,958) --
--------------- ---------------
(37,796,901) (13,920,482)
--------------- ---------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Hamilton
Shares..................................... 2,243,841,012 1,408,507,551
Hamilton Premier Shares...................... 2,810,413,019 616,137,202
Hamilton Classic Shares...................... 3,150,632 --
Proceeds from shares issued on reinvestment
of
dividends: Hamilton Shares................. 3,388,955 1,523,042
Hamilton Premier Shares...................... 7,918,171 1,776,675
Hamilton Classic Shares...................... 6,393 --
Cost of capital stock repurchased: Hamilton
Shares..................................... (1,878,397,366) (1,482,205,834)
Hamilton Premier Shares...................... (2,585,966,924) (510,115,047)
Hamilton Classic Shares...................... (58,633) --
--------------- ---------------
Increase in net assets resulting from
capital stock transactions................ 604,295,259 35,623,589
--------------- ---------------
INCREASE IN NET ASSETS.................. 604,295,259 35,623,589
NET ASSETS:
Beginning of year........................... 343,018,735 307,395,146
--------------- ---------------
End of year................................. $ 947,313,994 $ 343,018,735
--------------- ---------------
CHANGES IN CAPITAL STOCK OUTSTANDING:
Shares sold: Hamilton Shares................ 2,243,841,012 1,408,507,551
Hamilton Premier Shares...................... 2,810,413,019 616,137,202
Hamilton Classic Shares...................... 3,150,632 --
Shares issued on reinvestment of dividends:
Hamilton Shares............................ 3,388,955 1,523,042
Hamilton Premier Shares...................... 7,918,171 1,776,675
Hamilton Classic Shares...................... 6,393 --
Shares repurchased: Hamilton Shares......... (1,878,397,366) (1,482,205,834)
Hamilton Premier Shares...................... (2,585,966,924) (510,115,047)
Hamilton Classic Shares...................... (58,633) --
--------------- ---------------
Net increase............................... 604,295,259 35,623,589
Shares outstanding, beginning of year....... 343,018,735 307,395,146
--------------- ---------------
Shares outstanding, end of year............. 947,313,994 343,018,735
--------------- ---------------
</TABLE>
See notes to financial statements.
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6
<PAGE>
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Financial Highlights
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<TABLE>
<CAPTION>
HAMILTON
HAMILTON HAMILTON CLASSIC
SHARES PREMIER SHARES SHARES
--------------------------------------- -------------------- -----------
FOR THE FOR THE FOR THE
PERIOD PERIOD PERIOD
AUGUST 7, AUGUST 15, DECEMBER 4,
1992* YEAR 1994* 1995*
YEAR ENDED DECEMBER 31, THROUGH ENDED THROUGH THROUGH
---------------------------- DECEMBER DECEMBER DECEMBER DECEMBER
1995 1994 1993 31, 1992 31, 1995 31, 1994 31, 1995
-------- -------- -------- --------- -------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at
beginning of period..... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- -------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 0.057 0.040 0.030 0.012 0.054 0.017 0.004
-------- -------- -------- -------- -------- -------- -------
DIVIDENDS
Dividends from net
investment income....... (0.057) (0.040) (0.030) (0.012) (0.054) (0.017) (0.004)
-------- -------- -------- -------- -------- -------- -------
Net asset value at end of
period.................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- -------- -------
TOTAL RETURN:............ 5.84% 4.02% 3.03% 1.26%** 5.54% 1.69%** 0.40%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of
period
(000's omitted)......... $604,053 $235,220 $307,395 $135,852 $340,163 $107,799 $ 3,098
Ratio to average net
assets of:
Expenses, net of waiver
from The Bank of New
York................... 0.26% 0.30% 0.27% 0.20%*** 0.54% 0.61%*** 0.76%***
Expenses, prior to
waiver from The Bank of
New York............... 0.26% 0.32% 0.32% 0.49%*** 0.54% 0.61%*** 0.76%***
Net investment income,
net of waiver from The
Bank of New York....... 5.67% 3.92% 2.97% 3.11%*** 5.40% 4.40%*** 5.18%***
</TABLE>
* Commencement of investment operations for the respective class of shares.
** Not annualized.
*** Annualized.
See notes to financial statements.
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7
<PAGE>
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Notes to Financial Statements
1. ORGANIZATION AND BUSINESS
The BNY Hamilton Funds, Inc. (the "Company") was organized as a Maryland Cor-
poration on May 1, 1992 and is registered under the Investment Company Act of
1940 as an open-end management investment company. The Company currently con-
sists of four series. The BNY Hamilton Money Fund (the "Fund") commenced in-
vestment operations on August 7, 1992. The Fund consists of three classes of
shares: Hamilton Shares, Hamilton Premier Shares, and Hamilton Classic Shares.
2. SIGNIFICANT ACCOUNTING POLICIES
(A) SECURITY VALUATIONS
Securities are valued at amortized cost which approximates market value. This
method values a security at its cost at the time of purchase and thereafter as-
sumes a constant rate of amortization to maturity of any discount or premium.
(B) REPURCHASE AGREEMENTS
The Fund's custodian, or designated sub-custodians, as the case may be under
tri-party repurchase agreements, takes possession of the collateral pledged for
investments in repurchase agreements. The underlying collateral is valued daily
on a mark-to-market basis to ensure that the value, including accrued interest,
is at least equal to the repurchase price. In the event of default of the obli-
gation to repurchase, the Fund has the right to liquidate the collateral and
apply the proceeds in satisfaction of the obligations. Under certain circum-
stances, in the event of default or bankruptcy by the other party to the agree-
ment, realization and/or retention of the collateral may be subject to legal
proceedings.
(C) FEDERAL INCOME TAXES
The Fund is treated as a separate entity for federal income tax purposes. The
Fund's policy is to comply with the requirements of the Internal Revenue Code
applicable to regulated investment companies and distribute income to
shareholders within the allowable time limits. Therefore, no federal income tax
provision is required.
(D) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income is declared daily and paid monthly.
(E) SECURITY TRANSACTIONS AND INVESTMENT INCOME
Security transactions are recorded on the trade date and interest income is
accrued daily. Discounts and premiums on securities purchased are amortized
over the life of the respective securities.
Income, expenses (other than class specific expenses) and realized gains and
losses, if any, are allocated to each class of shares based upon their relative
shares outstanding.
(F) ORGANIZATION COSTS
Costs incurred in connection with the organization and initial registration of
the Fund are being amortized evenly over the period of benefit not to exceed 60
months from the date upon which the Fund commenced investment operations.
3. ADVISORY, ADMINISTRATION AND OTHER TRANSACTIONS WITH AFFILIATES
The Bank of New York acts as the Fund's investment adviser (the "Adviser").
The Adviser manages the investments of the Fund and is re-
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8
<PAGE>
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Notes to Financial Statements (continued)
sponsible for all purchases and sales of the Fund's portfolio securities. The
Adviser's fee is accrued daily and is payable monthly at the annual rate of
.10% of the average daily net assets of the Fund.
BNY Hamilton Distributors, Inc. acts as the Fund's administrator (the "Admin-
istrator") and will assist generally in supervising the operations of the Fund.
The Administrator has agreed to provide facilities, equipment and personnel to
carry out administrative services for the Fund, including, among other things,
providing the services of persons who may be appointed as officers and direc-
tors of the Fund, monitoring the custodian, fund accounting, transfer agency,
administration, distribution, advisory and legal services that are provided to
the Fund.
The Administrator's fee is accrued daily and is payable monthly at the annual
rate of .10% of the average daily net assets of the Fund.
In addition to acting as Administrator, BNY Hamilton Distributors, Inc. is the
principal underwriter and distributor of shares of the Fund. The Bank of New
York serves as the Fund's custodian and also serves as the fund accounting
agent.
BNY Hamilton Funds, Inc. has adopted a shareholder servicing plan, pursuant to
which Hamilton Premier Shares and Hamilton Classic Shares are sold to certain
institutions that enter into servicing agreements with BNY Hamilton Funds, Inc.
The Bank of New York and the Administrator (the "Shareholder Servicing Agents")
have each entered into Shareholder Service Agreements with respect to Hamilton
Premier Shares and Hamilton Classic Shares of the Fund. The Shareholder Servic-
ing Agents will perform shareholder support services. Pursuant to the Share-
holder Servicing Agreements, the Hamilton Premier Shares and Hamilton Classic
Shares will pay the Shareholder Servicing Agents an annual shareholder servic-
ing fee, accrued daily and payable monthly, of .25% of the Hamilton Premier
Shares' and Hamilton Classic Shares' respective average daily net assets. The
shareholder servicing plan does not cover, and the fees thereunder are not pay-
able to, Shareholder Organizations with respect to Hamilton Shares.
The Fund has adopted a distribution plan ("12b-1 Plan") with respect to Hamil-
ton Classic Shares of the Fund, pursuant to which the Fund will pay BNY Hamil-
ton Distributors, Inc. for expenses incurred during the year in connection with
the distribution of Hamilton Classic Shares. The aggregate amount payable annu-
ally by the Fund as provided in the 12b-1 Plan may not exceed .25% of the Ham-
ilton Classic Shares' average daily net assets.
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9
<PAGE>
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Report of Independent Accountants
The Shareholders and Board of Directors of
BNY Hamilton Money Fund:
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of BNY Hamilton Money Fund as of December 31,
1995, the related statements of operations for the year then ended and of
changes in net assets for each of the two years in the period then ended, and
the financial highlights for each of the three years in the period then ended
and for the period August 7, 1992 (commencement of investment operations)
through December 31, 1992. These financial statements and financial highlights
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements and financial highlights based
on our audits.
We conducted our audits in accordance with generally accepted auditing stan-
dards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial high-
lights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at Decem-
ber 31, 1995 by correspondence with the custodian. An audit also includes as-
sessing the accounting principles used and significant estimates made by man-
agement, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of BNY
Hamilton Money Fund as of December 31, 1995, the results of its operations, the
changes in its net assets and the financial highlights for the respective
stated periods, in conformity with generally accepted accounting principles.
Deloitte & Touche LLP
New York, New York
February 9, 1996
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10
<PAGE>
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DIRECTORS AND OFFICERS
Eugene Sullivan, Director and Chairman of the Board
Peter Herrick, Director
Leif H. Olsen, Director
Stephen Stamas, Director
Edward L. Gardner, Director
Richard E. Stierwalt, Chief Executive Officer
William B. Blundin, President
Ann E. Bergin, Vice President
William J. Tomko, Vice President
Martin Dean, Treasurer
George Martinez, Secretary
Karen Doyle, Assistant Treasurer
Robert L. Tuch, Assistant Secretary
Alaina Metz, Assistant Secretary
INVESTMENT ADVISER
The Bank of New York
ADMINISTRATOR AND DISTRIBUTOR
BNY Hamilton Distributors, Inc.
TRANSFER AGENT
BISYS Fund Services, Inc.
CUSTODIAN
The Bank of New York
INDEPENDENT ACCOUNTANTS
Deloitte & Touche LLP
LEGAL COUNSEL
Sullivan & Cromwell
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11
<PAGE>
BNY HAMILTON DISTRIBUTORS, INC. IS THE FUND'S DISTRIBUTOR AND IS UNAFFILIATED
WITH THE BANK OF NEW YORK, THE INVESTMENT ADVISER.
This report is not authorized for distribution to prospective investors unless
accompanied by a current prospectus for the BNY Hamilton Money Fund. Please
read the prospectus carefully before investing or sending money.
BNY HAMILTON FUNDS, INC.
3435 Stelzer Road
Columbus, Ohio 43219-3035
INVESTMENTS IN BNY HAMILTON MONEY FUND ARE NOT DEPOSITS, ARE NEITHER GUARANTEED
BY NOR OBLIGATIONS OF THE BANK OF NEW YORK AND ARE NOT INSURED BY THE FDIC OR
ANY OTHER GOVERNMENTAL AGENCY. INVESTMENTS IN MUTUAL FUNDS INVOLVE RISK, IN-
CLUDING THE POSSIBLE LOSS OF PRINCIPAL.
BNYMM95A
BNY HAMILTON
MONEY FUND
ANNUAL REPORT
DECEMBER 31, 1995
. HAMILTON SHARES
. HAMILTON PREMIER SHARES
. HAMILTON CLASSIC SHARES
[GRAPHIC]
BNY HAMILTON FUNDS
