<PAGE>
- --------------------------------------------------------------------------------
- --------- CHAIRMAN'S LETTER
July 15, 1996
DEAR FELLOW SHAREHOLDER,
I am pleased to report to you on the performance of the BNY Hamilton Equity
Income, Intermediate Government and Intermediate New York Tax-Exempt Funds for
the first half of 1996. Additionally, I want to take this opportunity to express
my appreciation for the confidence you have placed in the Funds to manage your
money.
INVESTMENT OUTLOOK
According to Kevin J. Bannon, Chief Investment Officer at The Bank of New
York, the long-term outlook for the financial markets is positive. In his view,
'the economy has been fairly hot, but should be cooling off by the fall with
inflation staying in check'. Mr. Bannon notes that 'too much growth is bad for
inflation and bonds and too little is bad for profits and stocks. While the
pick-up in economic activity during the second quarter has reduced the margin
for error, our judgment is that the economy will continue to successfully walk
the fine line down the middle, which is positive for both stocks and bonds.'
BNY HAMILTON EQUITY INCOME FUND
The BNY Hamilton Equity Income Fund delivered a 9.05% return during the
first six months of 1996, which compared very favorably to the Lipper Equity
Income Fund Average of 7.14%. The Fund's emphasis on large capitalization
dividend paying issues helped it closely track the Standard and Poor's 500
return of 10.19%.
<TABLE>
<CAPTION>
BNY HAMILTON LIPPER
EQUITY INCOME S&P 500 EQUITY INCOME
FUND INDEX FUND
------------- ------- -------------
<S> <C> <C> <C>
Six Months to June 30, 1996... 9.05% 10.19% 7.14%
One Year to June 30, 1996..... 21.23% 26.06% 20.96%
</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.
The Lipper Equity Income Fund Index is an index of similarly managed mutual
funds which takes into account fees and expenses.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN
-----------------------------------------------
PUBLIC OFFERING PRICE
PERIOD NET ASSET VALUE (INCLUDES 4.5% SALES CHARGE)
- ------------------------- --------------- ----------------------------
<S> <C> <C>
1 Year................... 21.23% 15.80%
3 Year................... 11.61% 9.92%
Inception (8/10/92)...... 12.53% 11.21%
</TABLE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
The first half of 1996 was a difficult period for the fixed income markets
as anxieties regarding the potential for overheating economic activity to
rekindle inflationary pressures pushed bond yields higher and prices lower. We
are pleased to report the BNY Hamilton Intermediate Government Fund outperformed
the Lipper Intermediate Government Fund Average during this period.
<TABLE>
<CAPTION>
LIPPER
BNY HAMILTON LEHMAN BROTHERS INTERMEDIATE
INTERMEDIATE INTERMEDIATE GOVERNMENT
GOVERNMENT FUND GOVERNMENT INDEX FUND AVERAGE
--------------- ---------------- ------------
<S> <C> <C> <C>
Six Months to June 30, 1996... -.69% -.01% -1.49%
One Year to June 30, 1996..... 4.08% 4.93% 3.76%
</TABLE>
(CONTINUED)
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
- --------- CHAIRMAN'S LETTER (CONTINUED)
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. The Lipper
Intermediate Government Fund Average is a composite of similarly managed
intermediate-term U.S. Government Bond funds which takes into account fees and
expenses.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN
----------------------------------------------
PUBLIC OFFERING PRICE
PERIOD NET ASSET VALUE (INCLUDING 3% SALES CHARGE)
- ------------------------- --------------- ---------------------------
<S> <C> <C>
1 Year................... 4.08% 0.98%
3 Year................... 3.43% 2.38%
Inception (8/10/92)...... 4.34% 3.53%
</TABLE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Inflation fears weighed on all fixed income markets, including municipal
bonds, during the first half of the year, but lessened concerns regarding the
proposed 'flat tax' contributed to tax-exempt issues outperforming taxable
issues.
For the six months through June 30, 1996, the BNY Hamilton Intermediate New
York Tax-Exempt Fund outperformed the Lipper Intermediate New York Tax-Exempt
Average and was competitive with the Lehman Brothers 5 Year State G.O. Bond
Index.
<TABLE>
<CAPTION>
LIPPER
INTERMEDIATE
INTERMEDIATE LEHMAN BROTHERS NEW YORK
NEW YORK 5-YEAR STATE TAX-EXEMPT
TAX-EXEMPT FUND G.O. INDEX FUND AVERAGE
--------------- --------------- ------------
<S> <C> <C> <C>
Six Months to June 30, 1996... -.03% 0.75% -0.35%
One Year to June 30, 1996..... 3.91% 5.40% 4.77%
</TABLE>
The Lehman Brothers 5-Year State G.O. Index is an unmanaged index generally
considered representative of the intermediate-term state general obligation
municipal bond market. The Index does not take into account fees and expenses.
The Lipper Intermediate New York Tax-Exempt Fund Average is a composite of
similarly managed New York State Tax-Exempt Bond Funds which takes into account
fees and expenses. The total return set forth may reflect the waiver of a
portion of the Fund's advisory or administrative fees. In such instances, and
without waiver offset, total return would have been lower. Some investors may be
subject to the alternative minimum tax and/or state and local taxes.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN
----------------------------------------------
PUBLIC OFFERING PRICE
PERIOD NET ASSET VALUE (INCLUDING 3% SALES CHARGE)
- ------------------------- --------------- ---------------------------
<S> <C> <C>
1 Year................... 3.91% 0.83%
3 Year................... 3.60% 2.55%
Inception (8/10/92)...... 4.29% 3.47%
</TABLE>
(CONTINUED)
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
- --------- CHAIRMAN'S LETTER (CONTINUED)
As of July 15, 1996, the Funds removed the front end sales charge.
Again, thank you for your continued investments in the BNY Hamilton Family
of Mutual Funds. We look forward to serving your investment needs in the months
to come.
Sincerely,
Eugene J. Sullivan
Chairman of the Board
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 the original cost.
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
- --------- TABLE OF CONTENTS
<TABLE>
<S> <C>
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......... 10
STATEMENT OF OPERATIONS..................... 10
STATEMENTS OF CHANGES IN NET ASSETS......... 11
FINANCIAL HIGHLIGHTS........................ 12
INTERMEDIATE NEW YORK TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS..................... 13
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
DIRECTORS AND OFFICERS............................ 23
</TABLE>
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON EQUITY INCOME FUND
Schedule of Investments
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF MARKET
SHARES VALUE
- --------------- ---------------
<S> <C> <C>
COMMON STOCKS--74.08%
AIRCRAFT MANUFACTURING--2.25%
53,100 Boeing Co. .................................. $ 4,626,338
---------------
BANKING--3.97%
33,280 Chase Manhattan Corp. ....................... 2,350,400
50,000 CoreStates Financial Corp. .................. 1,925,000
6,500 HSBC Holdings PLC (ADR)...................... 982,493
80,000 U.S. Bancorp................................. 2,890,000
---------------
8,147,893
---------------
BUSINESS EQUIPMENT
& SERVICES--1.56%
60,000 Xerox Corp. ................................. 3,210,000
---------------
CHEMICALS--BASIC--1.67%
105,500 Monsanto Co. ................................ 3,428,750
---------------
CHEMICALS--PETROLEUM--0.96%
25,000 duPont (E.I.) De Nemours..................... 1,978,125
---------------
COMMERCIAL SERVICES--1.56%
30,000 Flightsafety International, Inc. ............ 1,627,500
53,879 Olsten Corp. ................................ 1,582,696
---------------
3,210,196
---------------
COMMUNICATIONS
& PUBLISHING--1.34%
55,000 Harcourt General, Inc. ...................... 2,750,000
---------------
COMPUTERS--SOFTWARE
& PERIPHERALS--2.96%
*42,600 Cisco Systems, Inc. ......................... 2,412,225
45,482 Electronic Data Systems Corp. ............... 2,444,657
*53,900 Informix Corp. .............................. 1,212,750
---------------
6,069,632
---------------
CONGLOMERATES--2.14%
21,100 General Electric Co. ........................ 1,825,150
50,000........ Tenneco, Inc. ............................... 2,556,250
---------------
4,381,400
---------------
COSMETICS & TOILETRIES--1.32%
60,000 Avon Products, Inc. ......................... 2,707,500
---------------
ELECTRICAL EQUIPMENT--1.19%
130,000 Westinghouse Electric Corp. ................. 2,437,500
---------------
<CAPTION>
NUMBER OF MARKET
SHARES VALUE
- --------------- ---------------
<S> <C> <C>
COMMON STOCKS (CONTINUED)
ELECTRONICS--1.86%
15,000 Hewlett-Packard Co. ......................... $ 1,494,375
35,000 Sony Corp. (ADR)............................. 2,314,375
---------------
3,808,750
---------------
FINANCIAL SERVICES--1.02%
60,000 Invesco PLC (ADR)............................ 2,100,000
---------------
FINANCIAL SERVICES--
MORTGAGE COMPANIES--1.48%
90,800 Federal National Mortgage Association........ 3,041,800
---------------
FOOD & BEVERAGES--3.69%
39,500 Coca-Cola Co. ............................... 1,930,563
67,500 McDonald's Corp. ............................ 3,155,625
70,000 PepsiCo, Inc. ............................... 2,476,250
---------------
7,562,438
---------------
FOOD PROCESSING--3.44%
35,000 CPC International, Inc. ..................... 2,520,000
75,000 Heinz (H.J.) Co. ............................ 2,278,125
70,000 Sara Lee Corp. .............................. 2,266,250
---------------
7,064,375
---------------
HEALTH CARE PRODUCTS
& SERVICES--1.08%
41,350 Columbia Healthcare Corp. ................... 2,207,056
---------------
HOUSEHOLD & PERSONAL CARE
PRODUCTS--1.33%
30,000 Procter & Gamble Co. ........................ 2,718,750
---------------
INSURANCE--1.82%
19,050 American International Group, Inc. .......... 1,878,806
75,000 Equitable Cos., Inc. ........................ 1,865,625
---------------
3,744,431
---------------
MACHINERY & EQUIPMENT--0.92%
63,200 Stanley Works................................ 1,880,200
---------------
MEDICAL CARE PRODUCTS
& SUPPLIES--2.16%
25,000 Becton Dickinson & Co. ...................... 2,006,250
49,200 Johnson & Johnson............................ 2,435,400
---------------
4,441,650
---------------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
1
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON EQUITY INCOME FUND
Schedule of Investments (Continued)
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF MARKET
SHARES VALUE
- --------------- ---------------
COMMON STOCKS (CONTINUED)
<S> <C> <C>
NATURAL GAS--0.66%
40,000 Questar Corp. ............................... $ 1,360,000
---------------
OIL & GAS--0.97%
40,000 Williams Cos. ............................... 1,980,000
---------------
OIL--DOMESTIC--1.16%
20,000 Atlantic Richfield Co. ...................... 2,370,000
---------------
OIL--INTERNATIONAL--2.95%
45,000 Elf Aquitaine (ADR).......................... 1,653,750
31,200 Exxon Corp. ................................. 2,710,500
15,000 Mobil Corp. ................................. 1,681,875
---------------
6,046,125
---------------
PHARMACEUTICALS--4.70%
60,000 American Home Products Corp. ................ 3,607,500
11,600 Amgen, Inc. ................................. 626,400
45,000 Pfizer, Inc. ................................ 3,211,875
40,000 Warner-Lambert Co. .......................... 2,200,000
---------------
9,645,775
---------------
PHOTOGRAPHY EQUIPMENT--1.56%
41,200 Eastman Kodak Co. ........................... 3,203,300
---------------
RAILROADS--3.71%
37,234 Burlington Northern Santa Fe Corp. .......... 3,011,300
73,300 Canadian National Railway.................... 1,346,887
46,600 Union Pacific Corp. ......................... 3,256,175
---------------
7,614,362
---------------
REAL ESTATE INVESTMENT
TRUST--4.20%
85,000 Avalon Properties, Inc. ..................... 1,848,750
80,833 Camden Property Trust........................ 1,919,784
80,000 Federal Realty Investment Trust.............. 1,800,000
85,000 General Growth Properties.................... 2,050,625
30,000 Meditrust Corporation........................ 1,001,250
---------------
8,620,409
---------------
<CAPTION>
NUMBER OF MARKET
SHARES VALUE
- --------------- ---------------
<S> <C> <C>
COMMON STOCKS (CONTINUED)
RESORTS & ENTERTAINMENT--1.27%
41,600 Walt Disney Co. ............................. $ 2,615,600
---------------
RETAIL--SPECIALTY STORES--2.79%
*50,000 Borders Group, Inc. ......................... 1,612,500
52,600 Melville Corp. .............................. 2,130,300
*83,000 Office Max, Inc. ............................ 1,981,625
---------------
5,724,425
---------------
TECHNOLOGY INDUSTRIES--1.17%
38,200 Motorola, Inc. .............................. 2,401,825
---------------
TELECOMMUNICATIONS--
NON-U.S.--2.58%
*39,473 LCI International, Inc. ..................... 1,238,465
35,000 Nokia Corp. (ADR)............................ 1,295,000
50,000 Telefonica de Espana (ADR)................... 2,756,250
---------------
5,289,715
---------------
UTILITIES--GAS & ELECTRIC--6.64%
60,000 DQE, Inc. ................................... 1,650,000
85,000 Florida Progress Corp. ...................... 2,953,750
40,000 Oklahoma Gas & Electric...................... 1,585,000
75,000 Portland General Corp. ...................... 2,315,625
65,000 SCANA Corp. ................................. 1,828,125
77,150 Texas Utilities Co. ......................... 3,298,163
---------------
13,630,663
---------------
TOTAL COMMON STOCKS
(Cost $122,381,034).......................... 152,018,983
---------------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
2
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON EQUITY INCOME FUND
Schedule of Investments (Continued)
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF MARKET
SHARES VALUE
- --------------- ---------------
CONVERTIBLE PREFERRED
STOCKS--12.56%
<S> <C> <C>
BUSINESS EQUIPMENT
& SERVICES--1.01%
25,000 Alco Standard Corp., Ser. BB................. $ 2,075,000
---------------
COMPUTER SERVICES--1.47%
27,163 Ceridian Corp. .............................. 3,015,093
---------------
CONTAINERS--1.00%
45,000 Crown Cork & Seal............................ 2,047,500
---------------
FINANCIAL SERVICES--1.44%
45,000 American Express (DECS)...................... 2,953,125
---------------
GOLD & PRECIOUS METALS--1.06%
70,000 Freeport--McMoran Copper & Gold.............. 2,170,000
---------------
INDUSTRIAL GOODS
& EQUIPMENT--1.03%
35,000 Sonoco Products, Ser. A...................... 2,108,750
---------------
INSURANCE--1.07%
25,000 Allstate Corp. .............................. 987,500
15,000 Jefferson-Pilot 'NB' (ACES).................. 1,222,500
---------------
2,210,000
---------------
OIL & GAS--1.45%
80,000 Atlantic Richfield Co. ...................... 1,950,000
40,000 Enron Corp. ................................. 1,035,000
---------------
2,985,000
---------------
PHARMACEUTICALS--1.30%
11,000 Lehman 6.50% Amgen Yield
Enhanced Equity Linked Debt
Securities ('YEELDS') ....................... 673,750
30,000 Salomon 6.50% Amgen Yield
Enhanced Equity Linked Debt
Securities ('YEELDS') ....................... 2,002,500
---------------
2,676,250
---------------
RETAILING--1.19%
45,000 K mart Financing............................. 2,441,250
---------------
<CAPTION>
NUMBER OF MARKET
SHARES VALUE
- --------------- ---------------
<S> <C> <C>
CONVERTIBLE PREFERRED
STOCKS (CONTINUED)
STEEL--0.54%
30,000 AK Steel..................................... $ 1,102,500
---------------
TOTAL CONVERTIBLE
PREFERRED STOCKS
(Cost $20,848,320)........................... 25,784,468
---------------
<CAPTION>
PRINCIPAL
AMOUNT
- ---------------
<S> <C> <C>
CONVERTIBLE BONDS--6.92%
ELECTRONICS--0.98%
$ 2,000,000 Altera Corp., 5.75%, 6/15/02(a).............. 2,020,000
---------------
HEALTH CARE
& HOSPITAL MANAGEMENT--1.18%
1,250,000 HEALTHSOUTH Rehabilitation Corp., 5.00%,
4/01/01...................................... 2,418,750
---------------
INDUSTRIAL DEVELOPMENT--1.47%
1,500,000 Alza Corp., 5.00%, 5/01/06................... 1,458,750
1,500,000 Imax Corp., 5.75%, 4/01/03(a)................ 1,552,500
---------------
3,011,250
---------------
<CAPTION>
INDUSTRIAL GOODS
& EQUIPMENT--0.26%
<S> <C> <C>
500,000 LaFarge Corp., 7.00%, 7/01/13................ 531,250
---------------
OIL--DOMESTIC--0.69%
1,000,000 Pennzoil, 6.50%, 1/15/03..................... 1,408,750
---------------
REAL ESTATE INVESTMENT
TRUST--0.75%
1,500,000 Liberty Property Trust, 8.00%, 7/01/01....... 1,537,500
---------------
RESORTS & ENTERTAINMENT--0.49%
600,000 Carnival Corp., 4.50%, 7/01/97............... 999,750
---------------
SEMICONDUCTORS--0.39%
900,000 VLSI Technology, Inc., 8.25%, 10/01/05....... 795,375
---------------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
3
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON EQUITY INCOME FUND
Schedule of Investments (Continued)
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
- --------------- ---------------
CONVERTIBLE BONDS (CONTINUED)
<S> <C> <C>
WASTE MANAGEMENT--0.71%
$ 1,500,000 Molten Metal Technology, 5.50%, 5/01/06(a)... $ 1,470,000
---------------
TOTAL CONVERTIBLE BONDS
(Cost $12,701,159)........................... 14,192,625
---------------
FOREIGN BOND--0.75%
1,500,000 Republic of Italy, 5.00%, 6/28/01
(Cost $1,525,000)............................ 1,533,750
---------------
REPURCHASE
AGREEMENT--5.95%
12,205,000 Repurchase agreement with Deutsche Bank,
5.50%, due 7/01/96, repurchase price
$12,210,594 (Collateral--Various U.S.
Governmental Agency Debt Obligations,
5.74%-7.88%, 12/20/96-11/01/22; aggregate
market value plus accrued interest
$12,570,420) (Cost $12,205,000).............. 12,205,000
---------------
</TABLE>
<TABLE>
<CAPTION>
STRIKE MARKET
CONTRACTS PRICE VALUE
- --------------- ---------- ---------------
<S> <C> <C>
PURCHASED PUT OPTIONS--0.00%
* 100 Philadelphia Utility Index,
expiration 7/22/96
(Cost $16,550)..................... 240 $ 1,250
---------------
TOTAL INVESTMENTS BEFORE
OUTSTANDING WRITTEN CALL OPTIONS
(Cost $169,677,063)--
(b) 100.26%............................ 205,736,076
---------------
OUTSTANDING WRITTEN CALL OPTIONS--(0.02)%
* 350 Monsanto Co., expiration 7/22/96
(Premium received $59,288)......... 32 (35,000)
---------------
TOTAL INVESTMENTS NET OF
OUTSTANDING WRITTEN CALL OPTIONS
(Cost $169,617,775) 100.24%........ 205,701,076
Liabilities in excess of cash,
receivables and other
assets--(0.24%).................... (497,059)
---------------
NET ASSETS--100.00% $ 205,204,017
---------------
</TABLE>
<TABLE>
<S> <C>
* Non-income producing security.
ACES Automatic Common Exchange Securities.
ADR American Depository Receipt.
DECS Debt Exchangeable for Common Stock.
(a) Illiquid security, valued at fair value (see Note 2A).
(b) The cost stated also represents the aggregate cost for
Federal income tax purposes. At June 30, 1996, net
unrealized appreciation was $36,059,013 based on cost
for Federal income tax purposes. This consisted of
aggregate gross unrealized appreciation of $37,574,945
and aggregate gross unrealized depreciation of
$1,515,932. </TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
4
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON EQUITY INCOME FUND
Statement of Assets and Liabilities
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at market value,
(Identified cost $169,677,063)..... $205,736,076
Cash.................................. 360
Receivables:
Investments sold................... 12,535,747
Interest........................... 213,336
Dividends.......................... 571,387
Capital stock sold................. 5,048,841
Deferred organization costs and other
assets............................. 30,659
------------
TOTAL ASSETS....................... 224,136,406
------------
LIABILITIES:
Payables:
Investments purchased.............. 17,976,565
Capital stock repurchased.......... 28,969
Dividends.......................... 585,964
Services provided by the Bank of
New York and Administrator....... 274,495
Outstanding call options written
(premiums received $59,288)........ 35,000
Accrued expenses and other
liabilities........................ 31,396
------------
TOTAL LIABILITIES.................. 18,932,389
------------
NET ASSETS:
(applicable to 14,645,499 shares
issued and outstanding; 200 million
shares of $.001 par value
authorized)........................ $205,204,017
============
Net asset value, offering price and
repurchase price per share
($205,204,017/14,645,499 shares)... $ 14.01
============
Maximum public offering price per
share ($14.01/.955)................ $ 14.67
============
SOURCES OF NET ASSETS:
Capital stock @ par................... $ 14,645
Capital surplus....................... 162,066,509
Undistributed net investment income... 66,670
Accumulated net realized gain on
investments........................ 6,972,892
Net unrealized appreciation on
investments........................ 36,083,301
------------
NET ASSETS.............................. $205,204,017
============
</TABLE>
<TABLE>
<CAPTION>
Statement of Operations
FOR THE SIX MONTHS ENDED JUNE 30, 1996
(UNAUDITED)
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of
$39,145)..................................... $ 2,385,991
Interest........................................ 706,206
-----------
TOTAL INCOME................................. 3,092,197
-----------
EXPENSES:
Advisory........................................ 575,398
Administration.................................. 191,800
Accounting services............................. 29,836
Custodian....................................... 21,541
Cash management................................. 5,955
Transfer agent.................................. 34,908
Audit........................................... 4,564
Insurance....................................... 3,356
Directors....................................... 8,473
Reports to shareholders......................... 10,968
Registration and filings........................ 5,749
Legal........................................... 5,828
Other........................................... 12,699
-----------
TOTAL EXPENSES............................... 911,075
-----------
NET INVESTMENT INCOME........................ 2,181,122
-----------
REALIZED AND UNREALIZED GAIN
ON INVESTMENTS:
Net realized gain on investment transactions.... 6,768,734
Net realized gain on written call options....... 123,157
-----------
Net realized gain on investments................ 6,891,891
-----------
Increase in unrealized appreciation on
investments during the period................ 7,521,679
Increase in unrealized appreciation on written
call options during the period............... 216,904
-----------
Net unrealized gain on investments during the
period....................................... 7,738,583
-----------
Net realized and unrealized gain on
investments.................................. 14,630,474
-----------
Net increase in net assets resulting from
operations................................... $16,811,596
===========
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
5
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON EQUITY INCOME FUND
Statements of Changes in Net Assets
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1996 1995
------------ ------------
<S> <C> <C>
OPERATIONS:
Net investment income........................... $ 2,181,122 $ 4,157,218
Net realized gain on investments................ 6,891,891 6,729,207
Net unrealized gain on investments during the
period....................................... 7,738,583 24,728,968
------------ ------------
Net increase in net assets resulting from
operations.................................. 16,811,596 35,615,393
------------ ------------
DIVIDENDS AND DISTRIBUTION TO SHAREHOLDERS:
Dividends from net investment income............ (2,179,955) (4,143,915)
Distribution from capital gains................. -- (1,521,251)
------------ ------------
Total dividends and distribution to
shareholders................................ (2,179,955) (5,665,166)
------------ ------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold................ 34,255,210 28,650,069
Proceeds from reinvestment of dividends and
distribution................................. 1,014,698 3,841,802
Cost of capital stock repurchased............... (14,538,377) (27,731,884)
------------ ------------
Net increase in net assets resulting from
capital stock transactions.................. 20,731,531 4,759,987
------------ ------------
INCREASE IN NET ASSETS..................... 35,363,172 34,710,214
NET ASSETS:
Beginning of period............................. 169,840,845 135,130,631
------------ ------------
End of period................................... $205,204,017 $169,840,845
============ ============
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold..................................... 2,559,797 2,490,205
Shares issued on reinvestment of dividends and
distribution................................. 74,002 312,500
Shares repurchased.............................. (1,065,688) (2,352,875)
------------ ------------
Net increase................................. 1,568,111 449,830
Shares outstanding, beginning of period......... 13,077,388 12,627,558
------------ ------------
Shares outstanding, end of period............... 14,645,499 13,077,388
============ ============
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
6
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON EQUITY INCOME FUND
Financial Highlights
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE
PERIOD
AUGUST 10,
SIX MONTHS 1992*
ENDED YEAR ENDED DECEMBER 31, THROUGH
JUNE 30, -------------------------------- DECEMBER 31,
1996 1995 1994 1993 1992
---------- -------- -------- -------- ------------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period........................... $ 12.99 $ 10.70 $ 11.30 $ 10.43 $ 10.00
-------- -------- -------- -------- --------
INCOME FROM INVESTMENT OPERATIONS
Net investment income.............. 0.15 0.32 0.31 0.29 0.11
Net realized and unrealized gain
(loss) on investments............ 1.02 2.41 (0.60) 0.94 0.47
-------- -------- -------- -------- --------
Total from investment
operations.................. 1.17 2.73 (0.29) 1.23 0.58
-------- -------- -------- -------- --------
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment
income........................... (0.15) (0.32) (0.31) (0.28) (0.12)
-------- -------- -------- -------- --------
Distributions from capital gains... -- (0.12) -- (0.08) (0.03)
-------- -------- -------- -------- --------
Total dividends and
distributions............... (0.15) (0.44) (0.31) (0.36) (0.15)
-------- -------- -------- -------- --------
Net asset value at end of period... $ 14.01 $ 12.99 $ 10.70 $ 11.30 $ 10.43
======== ======== ======== ======== ========
TOTAL RETURN:+..................... 9.05%** 25.78% (2.58)% 11.94% 5.86%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period
(000's omitted).................. $205,204 $169,841 $135,131 $112,849 $ 20,440
Ratio to average net assets of:
Expenses, net of waiver from The
Bank of New York.............. 0.95%*** 1.00% 1.04% 1.09% 1.10%***
Expenses, prior to waiver from
The Bank of New York.......... 0.95%*** 1.00% 1.04% 1.12% 2.12%***
Net investment income, net of
waiver from The Bank of New
York.......................... 2.27%*** 2.66% 2.89% 2.82% 3.33%***
Portfolio turnover rate............ 20% 58% 51% 50% 25%
Average commission rate paid per
share traded..................... $ .0597 $ .0557
</TABLE>
* 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
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT MARKET VALUE
- --------------- ---------------
U.S. GOV'T AGENCIES & OBLIGATIONS--75.28%
UNITED STATES GOVERNMENT AGENCY
SECURITIES--32.05%
<S> <C> <C>
Federal Home Loan Bank,
$ 500,000 5.25%, 7/16/97............................... $ 495,315
4,000,000 5.37%, 11/3/00............................... 3,816,360
Federal Home Loan Mortgage Corporation,
500,000 5.76%, 7/13/98............................... 491,078
1,000,000 5.55%, 9/7/00................................ 958,452
3,300,000 6.61%, 3/4/03................................ 3,164,046
250,000 7.60%, 5/12/05............................... 248,281
Federal National Mortgage Association,
500,000 5.35%, 8/12/98............................... 488,899
3,200,000 6.20%, 7/10/03............................... 3,042,451
500,000 6.25%, 8/12/03............................... 475,492
132,250 8.50%, 2/25/04............................... 134,206
100,000 6.40%, 9/27/05............................... 95,821
Tennessee Valley Authority,
1,500,000 6.25%, 8/1/99................................ 1,486,630
1,350,000 6.00%, 11/1/00............................... 1,317,315
5,000,000 6.125%, 7/15/03.............................. 4,822,120
---------------
21,036,466
---------------
UNITED STATES TREASURY BONDS--10.69%
2,535,000 5.875%, 8/15/98.............................. 2,519,947
4,275,000 7.50%, 2/15/05............................... 4,495,427
---------------
7,015,374
---------------
UNITED STATES TREASURY NOTES--31.41%
75,000 6.50%, 5/15/97............................... 75,469
800,000 5.625%, 1/31/98.............................. 794,749
1,500,000 5.125%, 11/30/98............................. 1,463,905
3,625,000 6.375%, 1/15/99.............................. 3,634,063
2,000,000 6.75%, 6/30/99............................... 2,023,750
1,000,000 6.375%, 7/15/99.............................. 1,002,187
150,000 8.00%, 8/15/99............................... 156,937
1,500,000 6.875%, 8/31/99.............................. 1,521,562
<CAPTION>
PRINCIPAL
AMOUNT MARKET VALUE
- --------------- ---------------
<S> <C> <C>
U.S. GOV'T AGENCIES & OBLIGATIONS (CONTINUED)
UNITED STATES TREASURY NOTES
(CONTINUED)
$ 1,000,000 6.375%, 1/15/00.............................. $ 999,687
2,750,000 6.75%, 4/30/00............................... 2,779,219
300,000 7.50%, 5/15/02............................... 313,875
4,000,000 6.375%, 8/15/02.............................. 3,962,500
550,000 6.25%, 2/15/03............................... 540,031
1,000,000 5.75%, 8/15/03............................... 951,562
375,000 7.875%, 11/15/04............................. 403,242
---------------
20,622,738
---------------
UNITED STATES TREASURY STRIPPED
PRINCIPAL--1.13%
1,000,000 0.00%, 2/15/01............................... 743,640
---------------
TOTAL U.S. GOV'T AGENCIES & OBLIGATIONS (Cost
$51,009,002)................................. 49,418,218
---------------
MORTGAGE BACKED SECURITIES--10.41%
Federal Home Loan Mortgage Corporation,
491,800 Pool # 251836, 8.50%, 5/01/04................ 507,119
Federal National Mortgage Association
1,226,950 Pool # 195152, 7.00%, 1/1/08................. 1,216,177
885,551 Pool # 124118, 9.00%, 3/1/22................. 930,528
929,463 Pool # 190203, 8.00%, 2/1/23................. 942,513
915,061 Pool # 330091, 8.00%, 2/1/23................. 929,363
Government National Mortgage Association,
89,053 Pool # 7774, 8.00%, 9/15/04.................. 89,831
66,020 Pool # 6400, 8.00%, 6/15/05.................. 66,597
84,107 Pool # 7038, 8.00%, 10/15/05................. 84,843
76,399 Pool # 11310, 8.00%, 11/15/05................ 77,067
30,343 Pool # 9839, 8.00%, 7/15/06.................. 30,609
51,681 Pool # 10459, 8.00%, 8/15/06................. 52,133
185,257 Pool # 10419, 8.00%, 9/15/06................. 186,877
85,023 Pool # 12590, 8.00%, 9/15/06................. 85,766
161,098 Pool # 14295, 8.00%, 1/15/07................. 162,506
159,985 Pool # 204365, 9.00%, 3/15/17................ 169,280
801,480 Pool # 407323, 8.25%, 4/15/25................ 816,252
492,262 Pool # 417331, 7.50%, 3/15/26................ 485,028
---------------
TOTAL MORTGAGE BACKED SECURITIES (Cost
$6,931,877).................................. 6,832,489
---------------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
8
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
Schedule of Investments (Continued)
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT MARKET VALUE
- --------------- ---------------
COLLATERALIZED MORTGAGE
OBLIGATIONS--10.22%
<S> <C> <C>
Federal Home Loan Mortgage Corporation,
$ 1,057,716 Series 1317E, 7.00%, 6/15/04................. $ 1,064,094
500,000 Series 1202E, 7.00%, 7/15/05................. 502,410
500,000 Series 1467D, 6.70%, 8/15/05................. 499,120
500,000 Series 1338G, 6.75%, 1/15/06................. 500,385
252,552 Series G00100, 8.00%, 2/01/23................ 255,155
Federal National Mortgage Association,
500,000 Series 1992-108 G, 7.00%, 8/25/05............ 501,805
250,000 Series 1990-31 H, 7.00%,
6/25/19...................................... 250,230
2,000,000 Series 1991-137, 8.30%,
6/25/20...................................... 2,054,820
Government National Mortagage Association,
1,067,000 Series 1995-2D, 8.50%,
11/20/15..................................... 1,080,252
---------------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS
(Cost $6,728,747)............................ 6,708,271
---------------
<CAPTION>
PRINCIPAL
AMOUNT MARKET VALUE
- --------------- ---------------
<S> <C> <C>
REPURCHASE AGREEMENT--2.95%
$ 1,934,000 Repurchase agreement with Deutsche Bank,
5.50%, due 7/1/96, repurchase price
$1,934,886 (Collateral--Various U.S.
Governmental Agency Debt Instruments,
5.641%-7.88%, 12/20/96-9/25/08; aggregate
market value plus accrued interest $1,993,446
(Cost $1,934,000)............................ $ 1,934,000
---------------
TOTAL INVESTMENTS--
(Cost $66,603,626)--(a) 98.86%............... 64,892,978
Cash, receivables and other assets less
liabilities--1.14%........................... 750,378
---------------
NET ASSETS--100.00%.......................... $ 65,643,356
===============
</TABLE>
(a) The cost stated also represents the aggregate cost for Federal income tax
purposes. At June 30,1996, net unrealized depreciation was $1,710,648 based
on cost for Federal income tax purposes. This consisted of aggregate gross
unrealized appreciation of $109,408 and aggregate gross unrealized
depreciation of $1,820,056.
See notes to financial statements.
- --------------------------------------------------------------------------------
9
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
Statement of Assets and Liabilities
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS:
<S> <C>
Investments at market value, (Identified cost
$66,603,626)................................. $64,892,978
Cash............................................ 849
Receivables:
Investments sold............................. 38,085
Interest..................................... 1,194,857
Capital stock sold........................... 5,108,967
Deferred organization costs and other assets.... 24,700
-----------
TOTAL ASSETS................................. 71,260,436
-----------
LIABILITIES:
Payables:
Investments purchased........................ 4,973,478
Capital stock repurchased.................... 236,507
Dividends.................................... 293,195
Services provided by The Bank of New York and
Administrator.............................. 88,109
Accrued expenses and other liabilities.......... 25,791
-----------
TOTAL LIABILITIES............................ 5,617,080
-----------
NET ASSETS:
(applicable to 6,834,695 shares issued and
outstanding; 200 million shares of $.001 par
value authorized)............................ $65,643,356
===========
Net asset value, offering price and repurchase
price per share ($65,643,356/6,834,695
shares)...................................... $ 9.60
===========
Maximum public offering price per share
($9.60/.97).................................. $ 9.90
===========
SOURCES OF NET ASSETS:
Capital stock @ par............................. $ 6,835
Capital surplus................................. 69,704,775
Accumulated net realized loss on investments.... (2,357,606)
Net unrealized depreciation on investments...... (1,710,648)
-----------
NET ASSETS........................................ $65,643,356
===========
</TABLE>
<TABLE>
<CAPTION>
Statement of Operations
FOR THE SIX MONTHS ENDED JUNE 30, 1996
(Unaudited)
<S> <C>
INVESTMENT INCOME:
Interest........................................ $2,065,719
----------
EXPENSES:
Advisory........................................ 156,757
Administration.................................. 62,618
Accounting services............................. 29,836
Custodian....................................... 11,300
Cash management................................. 4,619
Transfer agent.................................. 16,425
Audit........................................... 1,652
Insurance....................................... 1,292
Directors....................................... 8,473
Reports to shareholders......................... 3,899
Registration and filing......................... 5,287
Legal........................................... 1,945
Other........................................... 9,807
----------
TOTAL EXPENSES............................... 313,910
----------
NET INVESTMENT INCOME........................ 1,751,809
----------
REALIZED AND UNREALIZED LOSS ON INVESTMENTS:
Net realized loss on investment transactions.... (247,521)
Decrease in unrealized appreciation on
investments during the period................ (1,915,002)
----------
Net realized and unrealized loss on
investments.................................. (2,162,523)
----------
Net decrease in net assets resulting from
operations................................... $ (410,714)
==========
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
10
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
Statements of Changes in Net Assets
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1996 1995
----------- ------------
<S> <C> <C>
OPERATIONS:
Net investment income........................... $ 1,751,809 $ 3,406,583
Net realized loss on investments................ (247,521) (704,447)
Increase in unrealized appreciation
(depreciation) on investments during the
period....................................... (1,915,002) 6,144,249
----------- -----------
Net increase (decrease) in net assets
resulting from operations................... (410,714) 8,846,385
----------- -----------
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income............ (1,751,809) (3,406,583)
----------- -----------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold................ 16,040,515 10,197,215
Proceeds from reinvestment of dividends......... 995,274 2,247,470
Cost of capital stock repurchased............... (9,888,831) (16,553,657)
----------- -----------
Increase (decrease) in net assets resulting
from capital stock transactions............. 7,146,958 (4,108,972)
----------- -----------
INCREASE IN NET ASSETS..................... 4,984,435 1,330,830
NET ASSETS:
Beginning of period............................. 60,658,921 59,328,091
----------- -----------
End of period................................... $65,643,356 $60,658,921
=========== ===========
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold..................................... 1,665,293 1,074,090
Shares issued on reinvestment of dividends...... 83,829 233,341
Shares repurchased.............................. (1,016,529) (1,726,729)
----------- -----------
Net increase (decrease)...................... 732,593 (419,298)
Shares outstanding, beginning of period......... 6,102,102 6,521,400
----------- -----------
Shares outstanding, end of period............... 6,834,695 6,102,102
=========== ===========
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
11
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
Financial Highlights
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE
PERIOD
AUGUST 10,
SIX MONTHS 1992*
ENDED YEAR ENDED DECEMBER 31, THROUGH
JUNE 30, ------------------------------- DECEMBER 31,
1996 1995 1994 1993 1992
---------- ------- ------- ------- ------------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period........................... $ 9.94 $ 9.10 $ 10.12 $ 9.87 $ 10.00
-------- ------- ------- ------- --------
INCOME FROM INVESTMENT OPERATIONS
Net investment income.............. 0.27 0.53 0.50 0.51 0.18
Net realized and unrealized gain
(loss) on investments............ (0.34) 0.84 (1.02) 0.27 (0.13)
-------- ------- ------- ------- --------
Total from investment
operations.................. (0.07) 1.37 (0.52) 0.78 0.05
-------- ------- ------- ------- --------
DIVIDENDS AND DISTRIBUTION
Dividends from net investment
income........................... (0.27) (0.53) (0.50) (0.51) (0.18)
Distribution from capital gains.... -- -- -- (0.02) --
-------- ------- ------- ------- --------
Total dividends and
distribution................ (0.27) (0.53) (0.50) (0.53) (0.18)
-------- ------- ------- ------- --------
Net asset value at end of period... $ 9.60 $ 9.94 $ 9.10 $ 10.12 $ 9.87
======== ======= ======= ======= ========
TOTAL RETURN:+..................... (0.69)%** 15.40% (5.17)% 8.03% 0.51%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted)......................... $ 65,643 $60,659 $59,328 $72,069 $ 25,575
Ratio to average net assets of:
Expenses, net of waiver from The
Bank of New York.............. 1.00%*** 1.06% 1.07% 0.86% 0.75%***
Expenses, prior to waiver from
The Bank of New York.......... 1.00%*** 1.06% 1.10% 1.15% 1.64%***
Net investment income, net of
waiver from The Bank of New
York.......................... 5.58%*** 5.52% 5.30% 5.04% 4.62%***
Portfolio turnover rate............ 28% 48% 49% 67% 63%
</TABLE>
* Commencement of investment operations.
** Not annualized.
*** Annualized.
+ Total return does not consider the effect of the sales load.
See notes to financial statements.
- --------------------------------------------------------------------------------
12
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Schedule of Investments
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S/
PRINCIPAL S&P INTEREST MATURITY MARKET
AMOUNT RATINGS RATE DATE VALUE
- --------------- ---------- -------- -------- -----------
MUNICIPAL BONDS--97.48%
CERTIFICATES OF PARTICIPATION--1.29%
<S> <C> <C> <C> <C> <C>
$ 500,000 New York State Certificate of
Participation........................... Baa1/BBB 5.000% 03/01/00 $ 495,505
-----------
EDUCATION--10.48%
235,000 Dutchess County, New York IDA Civic
Facility Revenue, Bard College.......... A/NR 6.000 11/01/99 242,059
250,000 New York State Dormitory Authority,
Columbia University..................... Aaa/AA+ 5.000 07/01/00 253,805
1,000,000 New York State Dormitory Authority,
Cornell University...................... Aa/AA 4.600 07/01/00 1,002,540
1,000,000 New York State Dormitory Authority, New
York University, MBIA Insured+.......... Aaa/AAA 5.500 07/01/04 1,033,330
1,000,000 New York State Dormitory Authority,
Strong Hospital (University of
Rochester).............................. A1/A+ 5.000 07/01/02 1,001,540
500,000 New York State Dormitory Authority,
University of Rochester................. A1/A+ 4.700 07/01/00 500,360
-----------
4,033,634
-----------
GENERAL OBLIGATION--10.43%
500,000 Monroe County, New York, MBIA
Insured+................................ Aaa/AAA 4.800 06/01/02 502,030
60,000 Monroe County, New York Series B,
Unrefunded Balance, Callable 6/01/98.... Aa/AA- 7.000 06/01/03 63,674
1,000,000 New York State, General Obligation...... A/A- 4.600 03/15/01 991,420
1,000,000 New York State, General Obligation...... A/A- 5.125 06/15/04 1,003,480
500,000 New York State Municipal Bond Bank
Agency (City of Rochester).............. NR/A+ 6.400 03/15/01 528,385
950,000 Town of New Castle, New York
(Westchester County).................... Aa/NR 4.000 06/01/00 925,395
-----------
4,014,384
-----------
HEALTH CARE--1.51%
500,000 New York State Medical Care
Facilities--Downstate Medical Center.... NR/AAA 5.700 02/15/04 518,735
60,000 New York State Medical Care
Facilities--Millard Fillmore Hospital
FHA..................................... Aa/AA 5.600 02/15/02 61,419
-----------
580,154
-----------
HOUSING--2.61%
500,000 New York State Mortgage Revenue
Agency.................................. Aa/NR 5.300 04/01/04 499,390
500,000 New York State Mortgage Revenue
Agency--Homeowner Mtg Series 37-A....... Aa/NR 5.850 04/01/06 503,085
-----------
1,002,475
-----------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
13
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Schedule of Investments (Continued)
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S/
PRINCIPAL S&P INTEREST MATURITY MARKET
AMOUNT RATINGS RATE DATE VALUE
- --------------- ---------- -------- -------- -----------
MUNICIPAL BONDS (CONTINUED)
<S> <C> <C> <C> <C> <C>
INDUSTRIAL DEVELOPMENT BONDS--3.90%
$ 500,000 Puerto Rico Industrial Medical
Environmental PCR, Intel Corp; Put
Option 9/01/98.......................... A1/A+ 4.000% 09/01/13 $ 497,405
1,000,000 Westchester County Industrial
Development Authority................... Aaa/AAA 4.850 07/01/00 1,005,420
-----------
1,502,825
-----------
PREREFUNDED/ESCROWED/US
GUARANTEED--4.55%
990,000 New York State Housing Finance Agency
ETM State University Construction....... Aaa/AAA 6.500 11/01/06 1,059,696
311,000 Puerto Rico Aqueduct & Sewer Authority
ETM..................................... Aaa/AAA 4.200 07/01/00 305,054
390,000 Puerto Rico Aqueduct & Sewer Authority
ETM..................................... Aaa/AAA 4.500 07/01/02 386,903
-----------
1,751,653
-----------
SPECIAL TAX--19.42%
2,500,000 Municipal Assistance Corp for New York
City.................................... Aa/A+ 6.000 07/01/05 2,657,175
300,000 New York State Local Government
Assistance Corp......................... A/A 6.700 04/01/00 319,677
1,000,000 New York State Local Government
Assistance Corp......................... A/A 5.300 04/01/00 1,017,960
340,000 New York State Local Government
Assistance Corp......................... A/A 6.750 04/01/02 371,906
655,000 New York State Local Government
Assistance Corp......................... A/A 5.000 04/01/02 655,923
1,000,000 New York State Local Government
Assistance Corp......................... A/A 4.600 04/01/03 967,870
500,000 New York State Local Government
Assistance Corp......................... A/A 4.800 04/01/05 479,580
1,000,000 New York State Thruway Authority Highway
& Bridge Trust Fund..................... A/A- 4.750 04/01/98 1,005,290
-----------
7,475,381
-----------
STATE APPROPRIATION--16.47%
420,000 Metropolitan Transportation Authority... Baa1/BBB 5.100 07/01/00 420,449
450,000 New York State Dormitory Authority,
State University........................ Baa1/BBB+ 7.100 05/15/98 471,380
900,000 New York State Dormitory Authority,
State University........................ Baa1/BBB+ 5.200 05/15/03 870,750
500,000 New York State Dormitory Authority,
State University........................ Baa1/BBB+ 5.500 05/15/07 482,905
1,400,000 New York State Dormitory Authority,
Upstate Community Colleges.............. Baa1/BBB- 4.500 07/01/00 1,364,454
500,000 New York State Medical Care
Facilities--Mental Health............... Baa1/BBB+ 4.600 08/15/99 494,555
275,000 New York State Medical Care
Facilities--Mental Health............... Baa1/BBB+ 4.700 02/15/01 265,334
505,000 New York State Medical Care
Facilities--Mental Health............... Baa1/BBB+ 4.700 08/15/01 485,593
480,000 New York State Medical Care
Facilities--Mental Health............... Baa1/BBB+ 6.100 08/15/02 491,520
1,000,000 New York State Thruway Authority Service
Contract................................ Baa1/BBB 5.000 04/01/00 993,840
-----------
6,340,780
-----------
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
14
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Schedule of Investments (Continued)
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S/
PRINCIPAL S&P INTEREST MATURITY MARKET
AMOUNT RATINGS RATE DATE VALUE
- --------------- ---------- -------- -------- -----------
MUNICIPAL BONDS (CONTINUED)
<S> <C> <C> <C> <C> <C>
TRANSPORTATION--13.87%
$ 625,000 New York State Thruway Authority General
Revenue................................. A1/A 5.125% 01/01/00 $ 632,694
1,500,000 New York State Thruway Authority General
Revenue................................. A1/A 5.250 01/01/01 1,525,845
650,000 Port Authority of New York & New
Jersey.................................. A1/AA- 5.100 08/01/01 659,861
500,000 Port Authority of New York & New
Jersey.................................. A1/AA- 6.100 10/15/02 533,525
1,000,000 Port Authority of New York & New
Jersey.................................. A1/AA- 5.300 08/01/03 1,021,270
1,000,000 Triborough Bridge & Tunnel Authority
General Purpose......................... Aa/A+ 4.300 01/01/02 965,440
-----------
5,338,635
-----------
UTILITY--10.45%
300,000 Great Neck North Water Authority, New
York.................................... A1/A- 6.900 01/01/00 321,717
250,000 New York State Environment Facs. Corp.
State Water............................. Aaa/AAA 6.000 05/15/02 264,803
500,000 New York State Envir. Fac. Corp. PCR
Water Revol............................. Aa/A- 5.100 06/15/00 508,050
400,000 New York State Envir. Fac. Corp. PCR
Water Revol............................. Aaa/AAA 6.300 09/15/00 425,148
500,000 New York State Power Authority.......... Aa/AA- 7.500 01/01/02 530,155
250,000 Onondaga County, New York Water
Authority............................... A1/A 6.250 01/15/98 257,592
700,000 Suffolk County Water Authority, New York
MBIA Insured+........................... Aaa/AAA 4.800 06/01/97 706,419
1,000,000 Suffolk County Water Authority, New York
MBIA Insured+........................... Aaa/AAA 4.800 06/01/00 1,006,720
-----------
4,020,604
-----------
OTHER--2.50%
340,000 New York City, Trust for Cultural
Resources Museum MOMA--AMBAC Insured+... Aaa/AAA 4.900 01/01/01 343,281
240,000 New York City, Trust for Cultural
Resources Museum MOMA--AMBAC Insured+... Aaa/AAA 5.000 01/01/02 242,299
350,000 New York City, Trust for Cultural
Resources Museum MOMA--AMBAC Insured+... Aaa/AAA 6.300 01/01/03 377,510
-----------
963,090
-----------
TOTAL MUNICIPAL BONDS (Cost
$37,439,399)............................ 37,519,120
-----------
TAX-EXEMPT MONEY MARKET FUND--1.31%
504,981 Dreyfus New York Municipal Cash
Management (Cost $504,981).............. NR/NR 3.190%(a) 504,981
-----------
TOTAL INVESTMENTS (Cost $37,944,380)
(b)--98.79%............................. 38,024,101
Cash, receivables, and other assets less
liabilities--1.21%...................... 467,186
-----------
NET ASSETS--100%........................ $38,491,287
===========
</TABLE>
<TABLE>
<S> <C>
NR Not rated by Moody's or Standard & Poor's ('S&P').
+ Insured or guaranteed by the indicated municipal bond
insurance corporation.
(a) Represents annualized yield at June 30, 1996.
(b) The cost stated also represents the aggregate cost for
Federal income tax purposes. At June 30, 1996, net
unrealized appreciation was $79,721 based on cost for
Federal income tax purposes. This consisted of aggregate
gross unrealized appreciation of $319,105 and aggregate
gross unrealized depreciation of $239,384.
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
15
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Statement of Assets and Liabilities
JUNE 30, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS:
<S> <C>
Investments at market value,
(Identified cost $37,944,380)...... $38,024,101
Receivables:
Interest........................... 617,659
Capital stock sold................. 99,500
Deferred organization costs and other
assets............................. 75,189
-----------
TOTAL ASSETS....................... 38,816,449
-----------
LIABILITIES:
Payables:
Investment purchased............... 83,477
Dividends.......................... 127,694
Services provided by The Bank of
New York and Administrator....... 88,488
Accrued expenses and other
liabilities........................ 25,503
-----------
TOTAL LIABILITIES.................. 325,162
-----------
NET ASSETS:
(applicable to 3,795,793 shares issued
and outstanding; 200 million shares
of $.001 par value authorized)..... $38,491,287
===========
Net asset value, offering price and
repurchase price per share
($38,491,287/3,795,793 shares)..... $ 10.14
===========
Maximum public offering price per
share ($10.14/.97)................. $ 10.45
===========
SOURCES OF NET ASSETS:
Capital stock @ par................... $ 3,796
Capital surplus....................... 38,738,469
Accumulated net realized loss on
investments........................ (330,699)
Net unrealized appreciation on
investments........................ 79,721
-----------
NET ASSETS.............................. $38,491,287
===========
</TABLE>
<TABLE>
<CAPTION>
Statement of Operations
FOR THE SIX MONTHS ENDED JUNE 30, 1996
(UNAUDITED)
<S> <C>
INVESTMENT INCOME:
Interest.............................. $933,045
--------
EXPENSES:
Advisory.............................. 97,520
Administration........................ 39,010
Accounting services................... 29,836
Custodian............................. 6,565
Cash management....................... 5,362
Transfer agent........................ 15,348
Audit................................. 1,228
Insurance............................. 894
Directors............................. 8,473
Reports to shareholders............... 2,470
Registration and filing............... 5,776
Legal................................. 1,407
Other................................. 11,747
--------
TOTAL EXPENSES..................... 225,636
Fees waived by The Bank of New York... (50,067)
--------
NET EXPENSES....................... 175,569
--------
NET INVESTMENT INCOME.............. 757,476
--------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS--
Net realized gain on investment
transactions....................... 128,992
Decrease in unrealized appreciation on
investments during the year........ (874,513)
--------
Net realized and unrealized loss on
investments........................ (745,521)
--------
Net increase in net assets resulting
from operations.................... $ 11,955
========
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
16
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Statements of Changes in Net Assets
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1996 1995
----------- ------------
<S> <C> <C>
OPERATIONS:
Net investment income........................... $ 757,476 $ 1,680,844
Net realized gain (loss) on investments......... 128,992 (75,562)
Increase in unrealized appreciation
(depreciation) on investments during the
period....................................... (874,513) 3,351,479
----------- -----------
Net increase in net assets resulting from
operations.................................. 11,955 4,956,761
----------- -----------
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income............ (757,476) (1,680,844)
----------- -----------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold................ 3,661,067 4,068,695
Proceeds from reinvestment of dividends......... 216,566 604,529
Cost of capital stock repurchased............... (5,571,760) (10,231,201)
----------- -----------
Decrease in net assets resulting from capital
stock transactions.......................... (1,694,127) (5,557,977)
----------- -----------
DECREASE IN NET ASSETS..................... (2,439,648) (2,282,060)
NET ASSETS:
Beginning of period............................. 40,930,935 43,212,995
----------- -----------
End of period................................... $38,491,287 $40,930,935
=========== ===========
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold..................................... 358,948 410,516
Shares issued on reinvestment of dividends...... 21,131 59,793
Shares repurchased.............................. (543,811) (1,014,728)
----------- -----------
Net decrease................................. (163,732) (544,419)
Shares outstanding, beginning of period......... 3,959,525 4,503,944
----------- -----------
Shares outstanding, end of period............... 3,795,793 3,959,525
=========== ===========
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
17
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Financial Highlights
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE
PERIOD
AUGUST 10,
SIX MONTHS 1992*
ENDED YEAR ENDED DECEMBER 31, THROUGH
JUNE 30, ----------------------------- DECEMBER 31,
1996 1995 1994 1993 1992
---------- ------- ------- ------- ------------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period........................... $ 10.34 $ 9.59 $ 10.37 $ 9.97 $ 10.00
-------- ------- ------- ------- --------
INCOME FROM INVESTMENT OPERATIONS
Net investment income.............. 0.20 0.39 0.39 0.38 0.15
Net realized and unrealized gain
(loss) on investments............ (0.20) 0.75 (0.78) 0.40 (0.03)+
-------- ------- ------- ------- --------
Total from investment
operations.................. 0.00 1.14 (0.39) 0.78 0.12
-------- ------- ------- ------- --------
DIVIDENDS
Dividends from net investment
income........................... (0.20) (0.39) (0.39) (0.38) (0.15)
-------- ------- ------- ------- --------
Net asset value at end of period... $ 10.14 $ 10.34 $ 9.59 $ 10.37 $ 9.97
-------- ------- ------- ------- --------
TOTAL RETURN:++.................... (0.03)%** 12.08% (3.81)% 7.99% 1.18%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted)......................... $ 38,491 $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%*** 0.90% 0.85% 0.68% 0.60%***
Expenses, prior to waiver from
the Bank of New York and
Administrator................. 1.16%*** 1.20% 1.20% 1.30% 1.96%***
Net investment income, net of
waiver from the Bank of New
York and Administrator........ 3.89%*** 3.89% 3.92% 3.74% 3.79%***
Portfolio turnover rate............ 12% 4% 18% 6% --
</TABLE>
<TABLE>
<S> <C>
* 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.
</TABLE>
See notes to financial statements.
- --------------------------------------------------------------------------------
18
<PAGE>
- --------------------------------------------------------------------------------
- --------- NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. ORGANIZATION AND BUSINESS
The BNY Hamilton Funds, Inc. (the 'Company') was organized as a Maryland
Corporation on May 1, 1992 and is registered under the Investment Company Act of
1940 as an open-end management investment company. The Company currently
consists of four series: BNY Hamilton Money Fund (not included herein), BNY
Hamilton Equity Income Fund, BNY Hamilton Intermediate Government Fund and BNY
Hamilton Intermediate New York Tax-Exempt Fund (individually, a 'Fund' and
collectively, 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
regular 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
securities 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 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
'Intermediate New York Tax-Exempt Fund')
Securities are valued using prices supplied daily by an independent pricing
service or services that (1) are based on the last sale price on a national
securities exchange, or in the absence of recorded sales, at the readily
available 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, including
investments that are subject to limitations as to their sale (restricted
securities and illiquid securities), are valued at fair value as determined in
good faith by the Fund's Board of Directors for all Funds. In determining fair
value, consideration is given to cost, operating and other financial data.
(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
obligation to repurchase, the Funds have the right to liquidate the collateral
and apply the proceeds in satisfaction of the obligations. Under certain
circumstances, in the event of default or bankruptcy by the other party to the
agreeement, realization and/or retention of the collateral may be subject to
legal proceedings.
- --------------------------------------------------------------------------------
19
<PAGE>
- --------------------------------------------------------------------------------
- --------- NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
(C) WRITTEN OPTIONS AND PURCHASED OPTIONS
The Equity Income Fund enters into an option contract for the purpose of
either hedging its exposure to the market fluctuations of the portfolio, or an
individual security position. The nature and risks associated with these
securities 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 losses. In addition, short term capital gains or losses may be realized
on exercised 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
unlimited market risk of favorable changes in the value of the call option's
underlying 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
stipulated 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
transaction, 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
underlying 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 increased 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
declares and pays dividends monthly.
Income and capital gains distributions are determined in accordance with
income tax regulations which may differ from methods used to determine the
corresponding 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 capital gain. Where such differences are permanent in nature, they
are reclassified 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.
- --------------------------------------------------------------------------------
20
<PAGE>
- --------------------------------------------------------------------------------
- --------- NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
(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 method.
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.
(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
accrues daily and is payable monthly at the following annual rates:
<TABLE>
<CAPTION>
% OF AVERAGE
DAILY NET ASSETS
----------------
<S> <C>
Equity Income Fund...................... .60%
Intermediate Government Fund............ .50%
Intermediate New York Tax-Exempt Fund... .50%
</TABLE>
BNY Hamilton Distributors, Inc. acts as the Funds' administrator (the
'Administrator') 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
directors 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
utilizing the following annual rates:
<TABLE>
<CAPTION>
% OF AVERAGE
DAILY NET ASSETS
----------------
<S> <C>
Equity Income Fund................................ .20%
Intermediate Government Fund...................... .20%
Intermediate New York Tax-Exempt Fund............. .20%
</TABLE>
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
extent that expenses for that Fund exceeded .90% of average daily net assets.
There is currently no reimbursement of expenses with respect to the Equity
Income 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
accrued for such fees in the accompanying financial statements.
- --------------------------------------------------------------------------------
21
<PAGE>
- --------------------------------------------------------------------------------
- --------- NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
4. PORTFOLIO SECURITIES
During the six months ended June 30, 1996, the cost of purchases and the
proceeds from sales of securities, other than short-term securities, were as
follows:
<TABLE>
<CAPTION>
EQUITY
INCOME FUND
-------------------------
PURCHASES SALES
----------- -----------
<S> <C> <C>
US Gov't Securities........... $ -- $ --
All Others.................... 55,758,439 35,296,988
<CAPTION>
INTERMEDIATE
GOVERNMENT FUND
-------------------------
PURCHASES SALES
----------- -----------
<S> <C> <C>
US Gov't Securities........... $22,865,774 $16,283,189
All Others.................... -- 1,148,988
<CAPTION>
INTERMEDIATE
NEW YORK
TAX-EXEMPT FUND
-------------------------
PURCHASES SALES
----------- -----------
<S> <C> <C>
US Gov't Securities........... $ -- $ --
All Others.................... 4,673,470 5,400,730
</TABLE>
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.
<TABLE>
<CAPTION>
CAPITAL LOSS
CARRYFORWARD EXPIRATION
------------ ----------
<S> <C> <C>
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
</TABLE>
6. WRITTEN OPTION ACTIVITY
Transactions in written options during the six months ended June 30, 1996
were as follows:
<TABLE>
<CAPTION>
NUMBER PREMIUMS
OF CONTRACTS RECEIVED
------------ ----------
<S> <C> <C>
EQUITY INCOME FUND:
Options outstanding at
December 31, 1995........... 105 $ 595,540
Options written during the six
months ended June 30,
1996........................ 1,185 512,883
Options terminated in closing
purchase transactions....... (890) (1,024,109)
Options expired............... (50) (25,026)
------ ----------
Options outstanding at June
30, 1996.................... 350 $ 59,288
------ ----------
</TABLE>
The cost of cancelling options in closing purchase transactions was $1,227,669,
resulting in a net-short term capital gain of $203,560.
- --------------------------------------------------------------------------------
22
<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
J. David Huber, Chief Executive Officer
William J. Tomko, President
Michael J. Brascetta, Vice President
Mary A. Madick, Vice President
Karen A. Doyle, Vice President
Mark E. Nagle, Treasurer
Martin R. Dean, Assistant Treasurer
George O. Martinez, Secretary
Alaina Metz, Assistant Secretary
Bruce Treff, 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
- --------------------------------------------------------------------------------
23
<PAGE>
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
additional 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
OBLIGATIONS 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.
BNY-0040
BNY HAMILTON
FUNDS
Semi-Annual Report
June 30, 1996
(Unaudited)
o EQUITY INCOME FUND
o INTERMEDIATE GOVERNMENT FUND
o INTERMEDIATE NEW YORK TAX-EXEMPT FUND
[LOGO]
