<PAGE>
[LOGO] CHAIRMAN'S LETTER
Dear Shareholder:
We are pleased to provide you with the semiannual report for the BNY Hamilton
Funds. Please take a few minutes to review it. The semiannual report contains
performance and portfolio manager reports for each of our ten Funds as well as a
discussion of the investment environment by Kevin Bannon, Chief Investment
Officer of The Bank of New York. The Bank of New York is the investment advisor
to the Funds.
We are gratified by the growth of the BNY Hamilton Funds during the past six
months. Solid investment performance, successful sales initiatives and strong
inflows into the fund family helped boost total assets from $5.43 billion to
$6.04 billion, an increase of more than 11% for the first half of 1999.
At the BNY Hamilton Funds, we understand and appreciate the importance of your
investment. Given the volatility in the world's financial markets, that is why
we continue to believe that a disciplined, well-considered investment plan is
more important than ever. With a choice of ten well-diversified portfolios, each
managed with a consistent investment approach, the Funds are designed to provide
you with sound investment strategies to help you reach your important financial
goals.
Please contact your BNY Hamilton Funds representative with any questions you may
have about the Funds. If you would like a prospectus call 1-800-4BNY-FND
(1-800-426-9363). Please read the prospectus carefully before you invest.
Thank you for the confidence you have placed in us.
Sincerely,
/s/ Edward L. Gardner
Edward L. Gardner
Chairman of the Board
<PAGE>
[LOGO] INVESTMENT ADVISOR'S LETTER
Dear Shareholder:
The performance of the U.S. economy continues to rewrite the record books. The
current economic expansion passed its eighth anniversary during the Spring,
making it the longest peacetime expansion in modern times. Fueled by robust
consumer spending, the economy grew at a rate well in excess of its long-term
trend in the first half of this year. Corporate profits surged to record levels.
Most remarkably, both the unemployment rate and the core inflation rate declined
in tandem over this period to their lowest levels in almost 30 years.
Stock market investors cheered this combination of economic developments by
pushing the major market averages to new all-time highs. The Dow Jones
Industrial Average broke through the 10,000 barrier for the first time ever and
then climbed through the 11,000 level not long afterward. The S&P 500 also made
a series of new highs and provided investors with a total return of 12.24% for
the first six months of this year. Bond investors, however, reacted much less
enthusiastically to the reports of healthy economic growth. Confidence that the
economy could continue to expand without rekindling inflationary pressures waned
steadily through the first half, putting upward pressure on interest rates and
downward pressure on bond prices. The 10-year Treasury Note yield rose from
4.65% at the start of the year to 5.92% on June 30. The Lehman Brothers
Intermediate Government/Corporate Index, as a broad proxy for the taxable bond
market, posted a negative total return of -.58% for the first half.
Shifting perceptions regarding the outlook for economic activity outside the
U.S. also exerted an important influence on the performance of U.S. financial
markets during the first half of the year. In the first quarter, continuing
weakness in many overseas economies was a source of concern for investors in
terms of its potential negative impact on the profits of U.S. corporations. At
the same time, this weakness was also a source of encouragement in terms of its
positive implications for inflation. In the second quarter, investors
flip-flopped. Signs of improving growth abroad raised hopes on the profits
front, but also raised new concerns in terms of the outlook for continued low
inflation.
This shift in perceptions produced a very dramatic rotation in stock market
leadership beginning at the start of the second quarter. In a spectacular
reversal of fortune, long out-of-favor economically-sensitive and value-oriented
stocks came roaring back to life based on investors' belief that a synchronized
global boom might be unfolding. Rotation out of the large cap growth-oriented
issues in the technology, telecommunications, financial services and health care
sectors that had been the market leaders over the preceding two years also
benefited many smaller-cap stocks as market breadth improved. For the first time
in seven quarters, the Russell 2000 Index, which is a measure of smaller-cap
stocks, outperformed the S&P 500, gaining 15.55% versus 6.95% during the second
quarter. The full first half return for the Russell 2000 Index was 9.28%.
International equities also advanced in the first half with the MSCI EAFE
(Morgan Stanley Capital International Europe, Australia and Far East) Index
posting a gain of 4.11%. In contrast to the prior six months, Asian markets
dramatically outperformed European markets.
In our judgment, weakness outside the U.S. during the early part of this year
was a major factor in the Federal Reserve's decision to hold short-term interest
rates steady at a very low level through the entire first half despite the
clearly healthy performance of the U.S. economy. The Federal Reserve's decision
to raise the Federal Funds rate from 4.75% to 5.00% on June 30, in our opinion,
reflected their view that the global economy had returned to a sound enough
footing to enable them to "normalize" short-term interest rates. Importantly, we
do not view the Federal
<PAGE>
[LOGO]
Reserve's action--or a likely further modest increase in the Federal Funds
rate--as an indication of significant concerns regarding rising inflationary
pressures.
Low inflation has been one of the primary supports of the very favorable
investment environment which investors have enjoyed in the 1990s. In our view,
this environment is still firmly in place. Global competition remains fierce,
which makes it extremely difficult for companies to raise prices. Companies'
responses to this environment-- restructuring, merging, investing in technology
to boost productivity--are all contributing to creating a "virtuous circle"
which serves to keep inflation in check. While inflation/boom--and
deflation/bust--scares are sure to develop from time to time as they have over
the past few years, the underlying economic fundamentals of sustainable moderate
economic growth and subdued inflation, in our judgment, continue to provide a
bullish backdrop for both the stock and bond markets, here as well as abroad.
Sincerely,
/s/ Kevin J. Bannon
Kevin J. Bannon
Executive Vice President and
Chief Investment Officer
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
QUESTIONS & ANSWERS................................................... PAGE 1
BNY HAMILTON EQUITY INCOME FUND
Schedule of Investments............................................. 21
Statement of Assets and Liabilities................................. 25
Statement of Operations............................................. 25
Statements of Changes in Net Assets................................. 26
Financial Highlights................................................ 27
BNY HAMILTON LARGE CAP GROWTH FUND
Schedule of Investments............................................. 29
Statement of Assets and Liabilities................................. 33
Statement of Operations............................................. 33
Statements of Changes in Net Assets................................. 34
Financial Highlights................................................ 35
BNY HAMILTON SMALL CAP GROWTH FUND
Schedule of Investments............................................. 36
Statement of Assets and Liabilities................................. 40
Statement of Operations............................................. 40
Statements of Changes in Net Assets................................. 41
Financial Highlights................................................ 42
BNY HAMILTON INTERNATIONAL EQUITY FUND
Schedule of Investments............................................. 43
Industry Diversification............................................ 48
Statement of Assets and Liabilities................................. 49
Statement of Operations............................................. 49
Statements of Changes in Net Assets................................. 50
Financial Highlights................................................ 51
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
Schedule of Investments............................................. 52
Statement of Assets and Liabilities................................. 56
Statement of Operations............................................. 56
Statements of Changes in Net Assets................................. 57
Financial Highlights................................................ 58
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
Schedule of Investments............................................. PAGE 60
Statement of Assets and Liabilities................................. 65
Statement of Operations............................................. 65
Statements of Changes in Net Assets................................. 66
Financial Highlights................................................ 67
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
Schedule of Investments............................................. 68
Statement of Assets and Liabilities................................. 72
Statement of Operations............................................. 72
Statements of Changes in Net Assets................................. 73
Financial Highlights................................................ 74
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
Schedule of Investments............................................. 76
Diversification by State............................................ 85
Statement of Assets and Liabilities................................. 86
Statement of Operations............................................. 86
Statements of Changes in Net Assets................................. 87
Financial Highlights................................................ 88
BNY HAMILTON MONEY FUND
Schedule of Investments............................................. 89
Statement of Assets and Liabilities................................. 97
Statement of Operations............................................. 97
Statements of Changes in Net Assets................................. 98
Financial Highlights................................................ 99
BNY HAMILTON TREASURY MONEY FUND
Schedule of Investments............................................. 102
Statement of Assets and Liabilities................................. 104
Statement of Operations............................................. 104
Statements of Changes in Net Assets................................. 105
Financial Highlights................................................ 106
NOTES TO FINANCIAL STATEMENTS......................................... 107
DIRECTORS AND OFFICERS................................................ 115
</TABLE>
<PAGE>
[LOGO] BNY HAMILTON EQUITY INCOME FUND
AN INTERVIEW WITH ROBERT G. KNOTT, VICE PRESIDENT AND PORTFOLIO MANAGER
Q. WHAT FACTORS INFLUENCED THE INVESTMENT ENVIRONMENT FOR EQUITY INCOME FUNDS
DURING THE FIRST HALF OF 1999?
A. Fueled by a robust economy, low inflation and better-than-expected corporate
earnings strength, the U.S. stock market continued its powerful advance
during the six months ended June 30, 1999. During the first quarter, the
majority of the equity market's strong performance was concentrated in a
handful of large capitalization, growth-oriented stocks. During the second
quarter, however, the market began to broaden as economically-sensitive
cyclical and value stocks demonstrated strength, and the previously
beleaguered Russell 2000 Index---a popular measure of small cap stock
performance---soundly outperformed the S&P 500 during April and May.
Q. GIVEN THIS CONTEXT, HOW DID THE FUND PERFORM?
A. The six-month period ended June 30, 1999 was characterized by strong
performance in the first quarter and lackluster performance in the second. As
a result, the Fund posted a total return of 8.39% for Institutional Class
Shares and 8.25% for Investor Class Shares(1). The Fund trailed its
benchmarks, the Lipper Equity Income Fund Index(2), which was up 9.03%, and
the S&P 500 Index(3), which gained 12.24% over the same period. The Fund's
underperformance relative to the Lipper Equity Income Fund Index was largely
due to its focus on growth-oriented, large-capitalization stocks, which we
continue to believe will provide the best long-term returns.
Q. WHAT STRATEGIES ACCOUNTED FOR THE FUND'S PERFORMANCE?
A. The Fund's emphasis on high-quality, dividend-paying large cap stocks helped
boost performance during the first three months of the year. As market
sentiment shifted toward cyclicals and value-oriented stocks in the second
quarter, however, this focus detracted from our relative performance during
April and May. Healthcare stocks in general and pharmaceuticals in particular
were notable laggards relative to the market, as were REITS and convertibles,
which lost momentum when interest rates began to rise.
Q. WHAT STOCKS PERFORMED WELL FOR THE FUND?
A. Circuit City, a high-growth retailer, performed very well during the period,
up 86% since the start of the year. Enron, a leading new age energy
distribution company, and Williams Company, a gas pipeline/telecommunications
company, also contributed to the Fund's performance, gaining 44% and 37%,
respectively, for the six-month period ended June 30.
Q. HOW DID THE PORTFOLIO'S COMPOSITION CHANGE DURING THE PERIOD?
A. We trimmed the Fund's exposure in the healthcare sector, lowering our
holdings by 4% over the six month period. This was in response to less
attractive relative earnings growth for the pharmaceutical industry in
general. When convertibles and REITs lagged the market during the second
quarter, we took the opportunity to increase our holdings in both sectors. In
particular, we boosted the percentage of convertibles to 24% of the
portfolio, up from 18%. Despite their underperformance relative to the
general market, we believe REITs and convertibles offer attractive yields and
defensive advantages on a long-term basis.
1
<PAGE>
[LOGO]
Q. WHAT IS YOUR STRATEGIC OUTLOOK GOING FORWARD?
A. We believe the current market offers considerable potential for our focus on
high-quality, dividend paying stocks. The U.S. economy remains healthy, with
low inflation and strong consumer spending. Currently, the Fund's positioning
reflects our view that inflation risks are not significant and that the
Federal Reserve Board will not need to raise interest rates significantly in
the short term.
<TABLE>
<CAPTION>
TRAILING TRAILING TRAILING SINCE
CURRENT TRAILING YEAR 12 3 YEARS 5 YEARS INCEPTION
PERIODS ENDED JUNE 30, 1999 MONTH 3 MONTHS TO DATE MONTHS ANNUALIZED ANNUALIZED ANNUALIZED
<S> <C> <C> <C> <C> <C> <C> <C>
BNY HAMILTON EQUITY INCOME
FUND (INSTITUTIONAL SHARES) 3.62% 5.88% 8.39% 10.78% 19.26%(4) 19.12%(4) 15.41%(4)
LIPPER EQUITY INCOME FUND
INDEX 3.15% 8.93% 9.03% 11.20% 19.55% 19.26% 16.48%
S&P 500 INDEX 5.47% 6.95% 12.24% 22.73% 29.07% 27.86% 21.86%
</TABLE>
Note: Returns for BNY Hamilton Funds and Lipper Fund Universe are after fees.
(1) TOTAL RETURN FIGURES INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THE ORIGINAL COST. PAST PERFORMANCE IS NO GUARANTEE OF
FUTURE RESULTS.
(2) Lipper indexes are based on the performance of the largest funds within a
given investment objective and do not include multiple share classes of
similar funds. Returns for these indexes are net of fees. Source: Lipper
Analytical Services, Inc.
(3) The S&P 500 is considered representative of the broad U.S. market of
large-capitalization stocks.
(4) Total return figures are shown at net asset value for all periods. These
figures do not consider the effect of the sales load in effect from July
11, 1994-July 12, 1996. Had the sales load been factored in to the above
figures, average annual total return for 3 years, 5 years and since
inception would have been lower. The quoted performance for the
Institutional Shares prior to their inception on 4/1/97 is based on the
performance of the Fund's Investor Shares, adjusted to reflect fees and
expenses. The inception date for the Investor Shares of the Fund was
August 10, 1992.
2
<PAGE>
[LOGO] BNY HAMILTON LARGE CAP GROWTH FUND
AN INTERVIEW WITH CHARLES GOODFELLOW, VICE PRESIDENT AND PORTFOLIO MANAGER
Q. WHAT FACTORS INFLUENCED THE INVESTMENT ENVIRONMENT FOR LARGE CAP STOCKS
DURING THE FIRST HALF OF 1999?
A. For most of the six month period ended June 30, 1999, optimism prevailed in
the U.S. equity market. Investor confidence soared, bolstered by a
near-perfect economic environment of robust economic growth, low interest
rates and nearly non-existent inflation. After surpassing 10,000 in March,
the Dow Jones Industrial Average promptly went on to cross the 11,000
threshold in May.
Against this backdrop, large cap stocks continued their dominance, albeit
by a smaller margin than in the preceding six months. In April and May,
market sentiment shifted away from growth-oriented issues toward economically
sensitive cyclical stocks and value-oriented sectors as news of exceptionally
strong U.S. corporate earnings and improving overseas markets fueled
inflationary fears.
Q. GIVEN THIS CONTEXT, HOW DID THE FUND PERFORM DURING THE PERIOD?
A. The Fund closed the first half of 1999 in the first quintile of its peer
group and well ahead of its benchmarks. With a return of 15.83% for
Institutional Class Shares and 15.57% for Investor Class Shares for the
six-month period ended June 30, 1999(1), the Fund compared very favorably to
the Lipper Growth and Income Fund Index(2) and the S&P 500 Index(3), which
were up 11.59% and 12.24%, respectively.
Q. WHAT FACTORS CONTRIBUTED TO THE FUND'S STRONG PERFORMANCE?
A. Much of the Fund's success can be attributed to its overweighting in
technology relative to its peers and the S&P 500 Index. Favorable stock
selection, most notably in the otherwise under-performing energy and
financial sectors, also boosted relative performance, especially when market
sentiment shifted away from growth stocks to value-oriented cyclical stocks
during the second quarter. Finally, the Fund's continued use of a carefully
applied hedging strategy helped benefit the Fund's return during the period.
Q. WHICH STOCKS PERFORMED PARTICULARLY WELL?
A. Tellabs, a telecommunications equipment manufacturer, which was up 97.1% and
Global Crossing, a telecommunications facilities provider, up 88.4% were top
performers during the period. Both companies benefited from strong gains in
telecom carrier spending. Another beneficiary of the high-tech boom was
Applied Materials, which gained 73.1% during the period as a result of
increased orders for semiconductor testing equipment.
Q. WHAT IS YOUR STRATEGIC OUTLOOK GOING FORWARD?
A. We expect corporate profits to remain strong and inflation to remain subdued
as the economy begins to slow to a more moderate and sustainable growth path.
Market volatility is likely to continue as leadership shifts back and forth
between large growth stocks--like communications and technology stocks---and
cyclicals. However,
3
<PAGE>
[LOGO]
we remain confident that investors who focus on successful large
companies--ones that demonstrate consistent growth and are able to ride out a
period of slowing economic activity--will be rewarded over time.
<TABLE>
<CAPTION>
TRAILING TRAILING TRAILING TRAILING
CURRENT TRAILING YEAR 12 3 YEARS 5 YEARS 10 YEARS
PERIODS ENDED JUNE 30, 1999 MONTH 3 MONTHS TO DATE MONTHS ANNUALIZED ANNUALIZED ANNUALIZED
<S> <C> <C> <C> <C> <C> <C> <C>
BNY HAMILTON LARGE CAP GROWTH
FUND (INSTITUTIONAL SHARES) 6.23% 5.41% 15.83% 21.65% 27.81%(4) 26.03%(4) 17.41%(4)
LIPPER GROWTH AND INCOME FUND
INDEX 4.14% 9.28% 11.59% 13.56% 21.40% 21.11% 15.24%
S&P 500 INDEX 5.47% 6.95% 12.24% 22.73% 29.07% 27.86% 18.76%
</TABLE>
Note: Returns for BNY Hamilton Funds and Lipper Fund Universe are after fees.
(1) TOTAL RETURN FIGURES INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THE ORIGINAL COST. PAST PERFORMANCE IS NO GUARANTEE OF
FUTURE RESULTS.
(2) Lipper indexes are based on the performance of the largest funds within a
given investment objective and do not include multiple share classes of
similar funds. Returns for these indexes are net of fees. Source: Lipper
Analytical Services, Inc.
(3) The S&P 500 is considered representative of the broad U.S. market of
large-capitalization stocks.
(4) The quoted performance includes performance of common and collective
trust fund ("Commingled") accounts advised by The Bank of New York dating
back to 6/30/88 and prior to the Fund's commencement of operations on
4/1/97, as adjusted to reflect the expenses associated with mutual funds.
The Commingled accounts were not registered with the Securities and
Exchange Commission and, therefore, were not subject to the investment
restrictions imposed by law on registered mutual funds. If the Commingled
accounts had been registered, the Commingled accounts' performance may
have been adversely affected. The adviser has agreed to assume a portion
of the expenses for this Fund. Had expenses not been assumed, total
return and the average annual total return would have been lower. This
voluntary waiver and assumption of expenses may be modified or terminated
at any time, which would reduce the Fund's performance.
4
<PAGE>
[LOGO] BNY HAMILTON SMALL CAP GROWTH FUND*
AN INTERVIEW WITH JOHN LUI, VICE PRESIDENT AND PORTFOLIO MANAGER
Q. WHAT FACTORS INFLUENCED THE INVESTMENT ENVIRONMENT FOR SMALL CAP STOCKS
DURING THE FIRST HALF OF 1999?
A. Stronger-than-expected U.S. corporate earnings growth set the stage for
continued strong large cap equity returns during the first quarter of the
year. The trend represented a willingness on the part of investors to pay
ever-increasing premiums for stocks with strong, steady earnings growth. The
Dow Jones Industrial Average pushed through the 10,000 mark late in March and
the Standard & Poor's Stock Index advanced nearly 5%.
Investor sentiment shifted dramatically during the second quarter, as the
market broadened away from growth-oriented stocks to economically-sensitive
cyclical and value-oriented stocks. At the same time, small cap stocks roared
back to life, rallying amid evidence that foreign economies were stabilizing
and that strategic corporate buyers were beginning to take more notice of
attractively priced smaller companies. For the first time in seven quarters,
the Russell 2000 Index, which measures smaller capitalization U.S. stocks,
outperformed all major U.S. equity indexes.
Q. GIVEN THIS CONTEXT, HOW DID THE FUND PERFORM?
A. The Fund performed extremely well against this backdrop, returning 18.70% for
Institutional Class Shares and 18.49% for Investor Class Shares(1) for the
six months ended June 30, 1999. That placed the Fund significantly ahead of
its benchmarks, the Lipper Small Cap Fund Index(2) and the Russell 2000
Index(3), which returned 9.43% and 9.28%, respectively, over the same period.
Q. WHAT ACCOUNTED FOR THE FUND'S STRONG OUTPERFORMANCE?
A. The Fund's bottom-up stock selection strategy is to focus on small companies
that are growing faster than the average and offer the potential for
better-than-expected corporate profit growth. This emphasis on what we call
"mini-gorillas" helped us to find attractive portfolio holdings with
catalysts that had the potential to push prices higher, despite the shift in
sentiment from growth-to-value and then back to growth. It also helped us to
significantly outperform our peer group.
Q. WHAT WERE SOME OF THE FUND'S BEST PERFORMING STOCKS DURING THE PERIOD?
A. The technology, consumer and healthcare sectors had the best relative
earnings momentum, as evidenced by some of the Fund's top performers. In the
technology sector, we continued to focus on communications-oriented
companies--rather than PC-centric companies--such as Applied Micro Circuits,
Hi/fn, and Transwitch. In the consumer sector, we emphasized high-quality
global brand name companies, such as Tiffany. In the healthcare sector, Jones
Pharmaceuticals was a top performer and a prime example of a company with an
attractive new product cycle and strong distribution capability.
Q. WHAT DO YOU FORESEE FOR THE REST OF THE YEAR?
A. The valuation of small cap stocks relative to large caps in the current
market environment continues to be quite compelling. However, volatility has
become a hallmark of the current market and we expect it to continue
5
<PAGE>
[LOGO]
through 1999. In the meantime, we remain confident that the strength of our
stock selection process and the strong earnings profiles of our holdings will
help the Fund add value in the coming months.
<TABLE>
<CAPTION>
TRAILING TRAILING TRAILING SINCE
CURRENT TRAILING YEAR 12 3 YEARS 5 YEARS INCEPTION
PERIODS ENDED JUNE 30, 1999 MONTH 3 MONTHS TO DATE MONTHS ANNUALIZED ANNUALIZED ANNUALIZED
<S> <C> <C> <C> <C> <C> <C> <C>
BNY HAMILTON SMALL CAP GROWTH
FUND (INSTITUTIONAL SHARES) 11.62% 16.37% 18.70% 18.71% 14.76%(4) 19.65%(4) 18.45%(4)
LIPPER SMALL CAP FUND INDEX 7.00% 14.85% 9.43% 1.92% 7.77% 15.44% 16.30%
RUSSELL 2000 INDEX 4.52% 15.55% 9.28% 1.50% 11.21% 15.40% 17.50%
</TABLE>
Note: Returns for BNY Hamilton Funds and Lipper Fund Universe are after fees.
* Small-capitalization funds typically carry additional risks, since smaller
companies historically have experienced a greater degree of market
volatility.
(1) TOTAL RETURN FIGURES INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THE ORIGINAL COST. PAST PERFORMANCE IS NO GUARANTEE OF
FUTURE RESULTS.
(2) Lipper indexes are based on the performance of the largest funds within a
given investment objective and do not include multiple share classes of
similar funds. Returns for these indexes are net of fees. Source: Lipper
Analytical Services, Inc.
(3) The Russell 2000 Index is considered representative of the broad U.S.
market of small-capitalization stocks.
(4) The quoted performance includes performance of common and collective
trust fund ("Commingled") accounts advised by The Bank of New York dating
back to 12/31/90 and prior to the Fund's commencement of operations on
4/1/97, as adjusted to reflect the expenses associated with mutual funds.
The Commingled accounts were not registered with the Securities and
Exchange Commission and, therefore, were not subject to the investment
restrictions imposed by law on registered mutual funds. If the Commingled
accounts had been registered, the Commingled accounts' performance may
have been adversely affected. The adviser has agreed to assume a portion
of the expenses for this Fund. Had expenses not been assumed, total
return and the average annual return would have been lower. This
voluntary waiver and assumption of expenses may be modified or terminated
at any time, which would reduce the Fund's performance.
6
<PAGE>
[LOGO] BNY HAMILTON INTERNATIONAL EQUITY FUND*
AN INTERVIEW WITH MARY CLARE BLAND, VICE PRESIDENT AND PORTFOLIO MANAGER
Q. WHAT FACTORS INFLUENCED THE INVESTMENT ENVIRONMENT FOR INTERNATIONAL STOCKS
DURING THE FIRST HALF OF 1999?
A. The first six months of the year were marked by significant rotations in the
international equity markets. The Pacific economies (ex-Japan) saw a
remarkable turnaround from 1998's meltdown, rallying strongly in response to
falling domestic interest rates, stable currencies, strong domestic
consumption and improving exports. Japan's market also gained momentum,
revived largely by a rash of corporate restructuring plans announced by such
leading companies as Sony and Toshiba. Concurrently, Latin America was forced
to deal with the aftermath of the devaluation of the real, Brazil's currency.
With the exception of Argentina, most of these economies were able to escape
relatively unscathed from last year's turmoil.
In contrast, the European markets experienced sluggish growth as a result
of the strong U.S. dollar, weaker exports (an aftermath of the Asian crisis),
and the massive austerity measures required of many European economies to
qualify for euro-related convergence.
Q. GIVEN THIS CONTEXT, HOW DID THE FUND PERFORM DURING THE PERIOD?
A. For the six month period ended June 30, 1999, the Fund returned 2.79% for
Institutional Class Shares and 2.57% for Investor Class Shares,(1) For the
same period, the Lipper International Fund Index(2) returned 6.90% and the
MSCI EAFE Index(3) returned 4.11%.
Q. WHAT ACCOUNTED FOR THE FUND'S UNDERPERFORMANCE?
A. First, the Fund was slow to move back into Japan, a decision that hurt
performance particularly near the end of the period. Second, the Fund was
underweighted in cyclicals, which were given a substantial boost when the
market leadership rotated sharply from growth-oriented stocks in the first
part of the year to more value-oriented cyclical stocks in the second quarter
of 1999.
Q. HOW DID THE FUND'S PORTFOLIO COMPOSITION CHANGE DURING THE PERIOD?
A. The Fund began the year overweighted in Europe and underweighted in Japan
relative to its indexes. As the Asian economies gathered strength, we began
to shift the portfolio's weighting. By the end of the period, the portfolio
was market weighted in all regions except for Europe, where it is marginally
underweighted, and the emerging markets, where it is marginally overweighted,
relative to the indexes.
Q. WHAT DO YOU FORESEE FOR THE SECOND HALF OF 1999?
A. This is an exciting, but critical time for the international markets. One or
more U.S. interest rate hikes could adversely affect the European markets.
Likewise, a significant drop in the value of the U.S. dollar could sidetrack
the export-fueled recoveries in Europe and Asia. However, looking forward we
anticipate continuing
7
<PAGE>
[LOGO]
global growth, with slow, stable growth in the U.S. and Europe, and strong
returns from Japan and Asia as these economies continue to recover.
<TABLE>
<CAPTION>
TRAILING TRAILING TRAILING SINCE
CURRENT TRAILING YEAR 12 3 YEARS 5 YEARS INCEPTION
PERIODS ENDED JUNE 30, 1999 MONTH 3 MONTHS TO DATE MONTHS ANNUALIZED ANNUALIZED ANNUALIZED**
<S> <C> <C> <C> <C> <C> <C> <C>
BNY HAMILTON INTERNATIONAL
EQUITY FUND (INSTITUTIONAL
SHARES) 4.57% 2.55% 2.79% 6.56% N/A N/A 13.43%
LIPPER INTERNATIONAL FUND
INDEX 4.74% 5.55% 6.90% 4.00% 10.80% 10.10% 10.84%
MSCI EAFE INDEX 3.92% 2.60% 4.11% 7.92% 9.12% 8.52% 12.29%
</TABLE>
Note: Returns for BNY Hamilton Funds and Lipper Fund Universe are after fees.
* International investing involves increased risk and volatility.
** The inception date for BNY Hamilton International Equity Fund
(Institutional Shares) was 4/1/97.
(1) TOTAL RETURN FIGURES INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THE ORIGINAL COST. PAST PERFORMANCE IS NO GUARANTEE OF
FUTURE RESULTS. The adviser has agreed to assume a portion of the
expenses for this Fund. Had expenses not been assumed, total return and
the average annual return would have been lower. This voluntary waiver
and assumption of expenses may be modified or terminated at any time,
which would reduce the Fund's performance.
(2) Lipper indexes are based on the performance of the largest funds within a
given investment objective and do not include multiple share classes of
similar funds. Returns for these indexes are net of fees. Source: Lipper
Analytical Services, Inc.
(3) The MSCI EAFE Index is considered representative of the equity markets in
Europe, Australia, Asia and the Far East.
8
<PAGE>
[LOGO] BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
AN INTERVIEW WITH WILLIAM BAIRD, VICE PRESIDENT AND PORTFOLIO MANAGER
Q. WHAT FACTORS INFLUENCED THE INVESTMENT ENVIRONMENT FOR U.S. GOVERNMENT BONDS
DURING THE FIRST HALF OF 1999?
A. During the first six months of the year, interest rates rose and bond prices
fell as investors became worried that stronger-than-expected domestic growth
and stabilizing global economic conditions might lead to a resurgence of
inflation. Those fears seemed misplaced until May when higher commodity
prices and a tight labor market resulted in a greater-than-anticipated rise
in the Consumer Price Index. Soon after, the Federal Reserve announced that
it was more likely to raise interest rates in the coming months than to lower
them. The bias toward tighter monetary policy became reality when the Fed
raised rates at its Open Market Committee meeting on June 30th in an effort
to put the brakes on the economy and keep inflationary pressures at bay.
Also contributing to both higher rates and an increase in the yield
spreads of corporate bonds and mortgage-backed securities over Treasuries was
a flood of supply of bond issuance, especially by corporate issuers. Ten-year
Treasury yields increased by 141 basis points to 5.78% from the start of the
period.
Q. GIVEN THIS CONTEXT, HOW DID THE FUND PERFORM?
A. The Fund outperformed its Lipper benchmark for the six-month period ended
June 30, 1999, returning -1.04% for Institutional Class Shares and -1.16% for
Investor Class Shares.(1) In comparison, the Lipper Intermediate U.S.
Government Fund Index(2) returned -1.74%. The Lehman Brothers Intermediate
Government Index(3) returned -0.46% for the same period.
Q. WHAT ACCOUNTED FOR THE FUND'S OUTPERFORMANCE DURING THE PERIOD?
A. By actively managing our sector weights and yield-curve exposure, we were
able to add additional returns to the portfolio without a significant
increase in portfolio risk. For example, as interest rates rose during the
second quarter we sought to increase the duration of the Fund to a level
comparable to that of our benchmark, the Lipper Intermediate U.S. Government
Fund Index. As mortgage spreads tightened, we also moved to decrease the
Fund's holdings in this sector of the market. By the end of the period, the
Fund's weighting in the mortgage sector fell from 60% to 55% of total assets.
We were able to accomplish both of these goals by reinvesting the principal
and interest cash flows from our mortgage holdings into Treasuries, and to a
lesser extent, agency securities.
After mortgage spreads widened late in the Spring, we used the Fund's
cash flow to add to certain Collateralized Mortgage Obligation (CMO)
positions. This strategy helped to enhance overall liquidity since larger CMO
positions are typically easier to trade. The CMO additions were primarily
made in better-structured bonds backed by lower coupon collateral. These
purchases, combined with additions to non-callable Treasuries and agency
securities, helped to improve the Fund's ability to provide attractive price
performance in a declining rate environment.
Q. WHAT DO YOU FORESEE FOR THE SECOND HALF OF 1999?
A. We believe that inflationary fears are overstated. Overall, the economy
remains well positioned to accommodate future growth without overheating. Our
expectation is for positive fixed income returns during the second half
9
<PAGE>
[LOGO]
of the year as interest rates begin to decline and wider credit spreads on
mortgage bonds begin to show improvement. Most importantly, the Fund remains
positioned to generate income with high quality securities in order to
achieve the Fund's investment objectives.
<TABLE>
<CAPTION>
TRAILING TRAILING TRAILING SINCE
CURRENT TRAILING YEAR 12 3 YEARS 5 YEARS INCEPTION
PERIODS ENDED JUNE 30, 1999 MONTH 3 MONTHS TO DATE MONTHS ANNUALIZED ANNUALIZED ANNUALIZED
<S> <C> <C> <C> <C> <C> <C> <C>
BNY HAMILTON INTERMEDIATE
GOVERNMENT FUND (INSTITUTIONAL
SHARES) -0.24% -1.02% -1.04% 2.66% 6.02%(4) 6.43%(4) 5.07%(4)
LIPPER INTERMEDIATE US
GOVERNMENT INDEX -0.33% -0.99% -1.74% 2.60% 6.38% 6.59% 5.59%
LEHMAN INTERMEDIATE GOVERNMENT
INDEX 0.15% -0.19% -0.46% 4.43% 6.57% 6.87% 5.98%
</TABLE>
Note: Returns for BNY Hamilton Funds and Lipper Fund Universe are after fees.
(1) TOTAL RETURN FIGURES INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THE ORIGINAL COST. PAST PERFORMANCE IS NO GUARANTEE OF
FUTURE RESULTS.
(2) Lipper indexes are based on the performance of the largest funds within a
given investment objective and do not include multiple share classes of
similar funds. Returns for these indexes are net of fees. Source: Lipper
Analytical Services, Inc.
(3) Lehman Brothers indexes represent broad market averages for fixed-income
securities.
(4) Total return figures are shown at net asset value for all periods. These
figures do not consider the effect of the sales load in effect from July
11, 1994-July 12, 1996. Had the sales load been factored in to the above
figures, average annual total return for 3 years, 5 years and since
inception would have been lower. The quoted performance for the
Institutional Shares prior to their inception on 4/1/97 is based on the
performance of the Fund's Investor Shares, adjusted to reflect fees and
expenses. The inception date for the Investor Shares of the Fund was
August 10, 1992. The adviser has agreed to assume a portion of the
expenses for this Fund. Had expenses not been assumed, total return and
the average annual return would have been lower. This voluntary waiver
and assumption of expenses may be modified or terminated at any time,
which would reduce the Fund's performance.
10
<PAGE>
[LOGO] BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
AN INTERVIEW WITH TERENCE MCCORMICK (VICE PRESIDENT) AND PAUL PERTUSI (ASSISTANT
VICE PRESIDENT), CO-PORTFOLIO MANAGERS
Q. WHAT FACTORS INFLUENCED THE INVESTMENT ENVIRONMENT FOR INVESTMENT-GRADE BONDS
DURING THE FIRST HALF OF 1999?
A. The overriding influence on the bond market during the first half of the year
was continued strength in the U.S. economy. The long-awaited slow down, which
was to be spurred by global weakness, never materialized. Paradoxically, the
global financial crisis of 1998 sowed the seeds for strong U.S. growth in
1999. As investors replaced riskier assets with U.S. Treasuries, interest
rates fell to their lowest levels in 30 years during the Fall of 1998. Low
interest rates encouraged already well-heeled consumers to spend freely. As a
result, the housing, automobile, and retail sectors of the economy all
strengthened during the first half of 1999. This, of course, was worrisome
news for bond investors who continued to associate strong economic growth
with rising inflationary pressures.
Q. GIVEN THIS CONTEXT, HOW DID THE FUND PERFORM?
A. For the six month period ended June 30, 1999, the Fund returned -1.85% for
Institutional Class Shares and -1.99% for Investor Class Shares,(1) For the
same period, the Lipper Intermediate Investment Grade Index(2) returned
-1.42% and the Lehman Brothers Intermediate Government/Corporate Bond
Index(3) returned -0.58%.
Q. WHAT WERE YOUR PRIMARY STRATEGIES DURING THE PERIOD?
A. The recent bearishness in the bond market provided us with the opportunity to
purchase bonds that we consider to be attractive on a relative value basis.
We have continued to add high-quality corporate positions in the intermediate
portion of the yield curve (5-10 years). We believe that many of the issuers
we favor (Ford, GMAC, Merrill Lynch) have suffered more from a general market
malaise than from anything related to their creditworthiness. We have focused
our purchases on higher quality issues, a segment of the market hurt the most
in the recent sell-off. In addition, we added to our existing agency and
mortgage collateral positions.
Q. WHICH OF THE FUND'S HOLDINGS WERE THE BEST PERFORMERS?
A. The Fund's high yield positions, which account for 7-8% of the total
portfolio, fared the best so far this year. After a particularly difficult
1998, high yield bonds snapped back from last year's depressed levels. The
surprising strength in the U.S. economy also benefited the high yield sector,
which typically performs well during periods of strong economic growth.
In contrast, our investment grade corporate holdings had the most
difficulty during the first half of the year, as last year's "flight to
quality" reversed course in 1999. This year's sell off has been particularly
severe in the higher quality sectors of the market.
Q. WHAT DO YOU FORESEE FOR THE SECOND HALF OF 1999?
A. The bond market is currently struggling with two issues. First, investors are
attempting to determine whether or not the Federal Reserve Board is entering
a sustained period of monetary tightening. They have also begun to
11
<PAGE>
[LOGO]
question the likelihood that inflation will remain dormant, given the
strength in the U.S. economy. We expect the Fed to normalize interest rates
further, tightening by another 25 basis points. However, we do not expect
that the Fed will need to continue to tighten much beyond the 5.25% level.
In our view, the Fed is taking back some of the monetary accommodation it
provided during last year's financial crisis. Furthermore, it is our belief
that threats from inflation will be short-lived and that the long-term trend
in prices will remain on a disinflationary path. The U.S. will likely
experience some moderation in growth during the second half of 1999, which
should provide adequate breathing room for the bond market.
<TABLE>
<CAPTION>
TRAILING TRAILING TRAILING TRAILING
CURRENT TRAILING YEAR 12 3 YEARS 5 YEARS 10 YEARS
PERIODS ENDED JUNE 30, 1999 MONTH 3 MONTHS TO DATE MONTHS ANNUALIZED ANNUALIZED ANNUALIZED
<S> <C> <C> <C> <C> <C> <C> <C>
BNY HAMILTON INTERMEDIATE
INVESTMENT GRADE FUND
(INSTITUTIONAL SHARES) -0.11% -1.27% -1.85% 2.69% 6.45%(4) 6.96%(4) 6.90%(4)
LIPPER INTERMEDIATE INVESTMENT
GRADE INDEX(5) -0.34% -1.02% -1.42% 2.48% 6.65% 7.14% 7.37%
LEHMAN INTERMEDIATE
GOVERNMENT/CORPORATE INDEX 0.07% -0.39% -0.58% 4.18% 6.63% 7.04% 7.64%
</TABLE>
Note: Returns for BNY Hamilton Funds and Lipper Fund Universe are after fees.
(1) TOTAL RETURN FIGURES INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THE ORIGINAL COST. PAST PERFORMANCE IS NO GUARANTEE OF
FUTURE RESULTS.
(2) Lipper indexes are based on the performance of the largest funds within a
given investment objective and do not include multiple share classes of
similar funds. Returns for these indexes are net of fees. Source: Lipper
Analytical Services, Inc.
(3) Lehman Brothers indexes represent broad market averages for fixed-income
securities.
(4) The quoted performance includes performance of common and collective
trust fund ("Commingled") accounts advised by The Bank of New York dating
back to 6/30/88 and prior to the Fund's commencement of operations on
4/1/97, as adjusted to reflect the expenses associated with mutual funds.
The Commingled accounts were not registered with the Securities and
Exchange Commission and, therefore, were not subject to the investment
restrictions imposed by law on registered mutual funds. If the Commingled
accounts had been registered, the Commingled accounts' performance may
have been adversely affected.
(5) Lipper Analytical Services began tracking this index on December 30,
1988.
12
<PAGE>
[LOGO] BNY HAMILTON INTERMEDIATE NEW YORK TAX EXEMPT FUND
AN INTERVIEW WITH COLLEEN M. FREY, VICE PRESIDENT AND PORTFOLIO MANAGER
Q. WHAT FACTORS INFLUENCED THE INVESTMENT ENVIRONMENT FOR MUNICIPAL BONDS DURING
THE FIRST HALF OF 1999?
A. During the first six months of this year, economic news relating to the U.S.
economy was positive. However, concerns over a healthier-than-anticipated
economy, particularly in light of the tight labor market, rekindled
inflationary fears. This drove interest rates higher and bond prices lower in
both the taxable and tax-exempt bond markets. Federal Reserve Chairman Alan
Greenspan's comments were cautionary to the markets and closely watched. The
Fed followed through with a 25 basis point rate increase on June 30.
The yield of the benchmark 10-year U.S. Treasury bond climbed from its
starting point of 4.63% on December 31, 1998 to 5.78% on June 30, 1999--an
increase of 115 basis points. Though yields of municipal bonds also rose, the
increase was not as dramatic. Yields on 5- and 10-year municipal bonds ended
the six-month period at 4.31% and 4.80%, respectively, up 60 and 65 basis
points. Still, municipal bonds continue to offer excellent value relative to
U.S. Treasuries, although they are not as attractive as they were at the
start of the year. As of June 30, the yields of 5- and 10- year municipals
were equal to 78% and 83% of the yield of the federally taxable 30-year U.S.
Treasury Bond.
Overall, the municipal bond market was somewhat less volatile than the
U.S. Government bond market during the period, as it benefited from a decline
in new issue supply relative to last year. To date, new issue supply is
behind last year's level by 25%.
Q. GIVEN THIS CONTEXT, HOW DID THE FUND PERFORM?
A. The Fund's year-to-date return of -1.44% for Institutional Class Shares and
-1.56% for Investor Class Shares(1) was slightly behind the Lipper New York
Intermediate Municipal Debt Fund Average(2), which returned -1.31% for the
six month period ended June 30, 1999, and the Lehman Brothers Five-Year
General Obligation Municipal Bond Index(3), which posted a return of -.14%
for the period.
Q. WHAT FACTORS CONTRIBUTED TO THE FUND'S PERFORMANCE?
A. Our outlook for the fixed income market was positive through the first half
of the year and we felt that the negative reaction to the
better-than-expected economic news was exaggerated. This overreaction in the
market and back-up in rates provided us an opportunity to purchase good
quality tax-exempt bonds in the 10-15 year maturity range at yields of 5% or
better. At the end of the period, the average maturity of the portfolio was
6.5 years--up from 6.1 years at year-end 1998.
Quality spreads continue to be narrow with little pick-up in yield for
lower quality issues. Triple and double-A rated issues now represent 60.6% of
the Fund's assets, up from 58.2% on December 31, 1998.
Q. WHAT DO YOU FORESEE FOR THE SECOND HALF OF 1999?
A. Our outlook for low inflation and moderate economic growth remains intact.
With the exception of healthcare, credit quality for most sectors of the
municipal market is expected to remain strong. Assuming new issue
13
<PAGE>
[LOGO]
volume continues at the pace set during the first half of the year, 1999
total issuance will be more than 20% less than last year's. Even with this
decline, 1999 levels could be the fourth highest on record.
<TABLE>
<CAPTION>
TRAILING TRAILING TRAILING SINCE
CURRENT TRAILING YEAR 12 3 YEARS 5 YEARS INCEPTION
PERIODS ENDED JUNE 30, 1999 MONTH 3 MONTHS TO DATE MONTHS ANNUALIZED ANNUALIZED ANNUALIZED
<S> <C> <C> <C> <C> <C> <C> <C>
BNY HAMILTON INTERMEDIATE NEW
YORK TAX-EXEMPT FUND
(INSTITUTIONAL SHARES) -1.49% -1.88% -1.44% 1.88% 4.55%(4) 4.78%(4) 4.40%(4)
LIPPER NEW YORK INTERMEDIATE
MUNICIPAL DEBT FUND AVERAGE -1.46% -1.80% -1.31% 2.03% 5.18% 5.28% 5.07%
LEHMAN 5 YEAR G.O. MUNI BOND
INDEX -1.11% -1.16% -0.14% 3.42% 5.33% 5.72% 5.47%
</TABLE>
Note: Returns for BNY Hamilton Funds and Lipper Fund Universe are after fees.
(1) TOTAL RETURN FIGURES INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THE ORIGINAL COST. PAST PERFORMANCE IS NO GUARANTEE OF
FUTURE RESULTS.
(2) Lipper indexes are based on the performance of the largest funds within a
given investment objective and do not include multiple share classes of
similar funds. Returns for these indexes are net of fees. Source: Lipper
Analytical Services, Inc.
(3) Lehman Brothers indexes represent broad market averages for fixed-income
securities.
(4) Total return figures are shown at net asset value for all periods. These
figures do not consider the effect of the sales load in effect from July
11, 1994-July 12, 1996. Had the sales load been factored in to the above
figures, average annual total return for 3 years, 5 years and since
inception would have been lower. The quoted performance for the
Institutional Shares prior to their inception on 4/1/97 is based on the
performance of the Fund's Investor Shares, adjusted to reflect fees and
expenses. The inception date for the Investor Shares of the Fund was
August 10, 1992. The adviser has agreed to assume a portion of the
expenses for this Fund. Had expenses not been assumed, total return and
the average annual return would have been lower. This volunary waiver and
assumption of expenses may be modified or terminated at any time, which
would reduce the Fund's performance.
14
<PAGE>
[LOGO] BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
AN INTERVIEW WITH JEFFREY NOSS, VICE PRESIDENT AND PORTFOLIO MANAGER
Q. WHAT FACTORS INFLUENCED THE INVESTMENT ENVIRONMENT FOR TAX-EXEMPT BONDS IN
THE FIRST HALF OF 1999?
A. Stronger-than-expected economic growth and the resulting threat of inflation
were on the top of investors' minds through much of the first six months of
the year. These concerns drove interest rates higher and bond prices lower
and prompted the Federal Reserve Board to raise short-term interest rates at
its Open Market Committee Meeting on June 30th. This contributed to a
downturn in price performance for the municipal bond market during the
period.
The yield on high-quality, intermediate term municipal bonds rose 65
basis points to 4.80%, up from 4.15% when the period began. The yield on the
10-year U.S. Treasury Note rose from 4.63% on December 31, 1998 to 5.78% on
June 30, an increase of 115 basis points.
Q. GIVEN THIS CONTEXT, HOW DID THE FUND PERFORM?
A. For the six-month period ended June 30, 1999, the Fund posted a total return
of return of -2.15% for Institutional Class Shares and -2.19% for Investor
Class Shares(1). In comparison, the Lipper Intermediate Municipal Bond Fund
Index(2) returned -1.13% and the Lehman Brothers Five-Year General Obligation
Municipal Bond Index(3) returned -.14% for the same period.
Q. WHAT ACCOUNTED FOR THE FUND'S PERFORMANCE?
A. We believe that the longer-term trend for interest rates is down. As a
result, the Fund remained positioned for that scenario during the first half
of the year. This hurt the Fund's performance relative to the indexes. As a
high credit-quality oriented Fund, we hold a smaller proportion of
lower-rated bonds than our peer group. Our higher-quality profile impacted
our relative performance when lower-rated bonds, reflecting the strong
economic backdrop, experienced relatively better price performance during the
period.
Q. HOW DID THE FUND'S PORTFOLIO COMPOSITION CHANGE DURING THE PERIOD?
A. The Fund increased its holdings of Baa-1 paper in order to take advantage of
improving credit trends in that segment of the market. This resulted in
stronger price performance for that group of credits during the first half of
the year. In light of our longer-term outlook for lower interest rates, we
also took advantage of weaker market conditions by tax swapping. This helped
to reduce the Fund's overall capital gains position and increase its overall
yield. Finally, we lengthened the duration of the portfolio slightly during
the period by approximately 4%.
Q. WHAT DO YOU FORESEE FOR THE SECOND HALF OF 1999?
A. While a greater new issue supply, higher-than-expected inflation and a
lowering of credit quality are potential risks for the fixed income markets,
we believe these scenarios are unlikely. Instead, we anticipate a lower
supply of intermediate-term municipal securities and a more favorable
interest rate environment. As a result, we
15
<PAGE>
[LOGO]
remain positive in our outlook for the municipal bond market for the rest of
the year and have positioned the Fund to reflect that view.
<TABLE>
<CAPTION>
TRAILING TRAILING TRAILING TRAILING
CURRENT TRAILING YEAR 12 3 YEARS 5 YEARS 10 YEARS
PERIODS ENDED JUNE 30, 1999 MONTH 3 MONTHS TO DATE MONTHS ANNUALIZED ANNUALIZED ANNUALIZED
<S> <C> <C> <C> <C> <C> <C> <C>
BNY HAMILTON INTERMEDIATE
TAX-EXEMPT FUND (INSTITUTIONAL
SHARES) -1.78% -2.31% -2.15% 1.21% 4.38%(4) 4.63%(4) 5.49%(4)
LIPPER INTERMEDIATE MUNICIPAL
FUND INDEX -1.36% -1.68% -1.13% 2.19% 5.29% 5.53% 6.30%
LEHMAN 5 YEAR G.O. MUNI BOND
INDEX -1.11% -1.16% -0.14% 3.42% 5.33% 5.72% 6.51%
</TABLE>
Note: Returns for BNY Hamilton Funds and Lipper Fund Universe are after fees.
(1) TOTAL RETURN FIGURES INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL
FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THE ORIGINAL COST. PAST PERFORMANCE IS NO GUARANTEE OF
FUTURE RESULTS.
(2) Lipper indexes are based on the performance of the largest funds within a
given investment objective and do not include multiple share classes of
similar funds. Returns for these indexes are net of fees. Source: Lipper
Analytical Services, Inc.
(3) Lehman Brothers indexes represent broad market averages for fixed-income
securities.
(4) The quoted performance includes performance of common and collective
trust fund ("Commingled") accounts advised by The Bank of New York dating
back to 6/30/88 and prior to the Fund's commencement of operations on
4/1/97, as adjusted to reflect the expenses associated with mutual funds.
The Commingled accounts were not registered with the Securities and
Exchange Commission and, therefore, were not subject to the investment
restrictions imposed by law on registered mutual funds. If the Commingled
accounts had been registered, the Commingled accounts' performance may
have been adversely affected.
16
<PAGE>
[LOGO] BNY HAMILTON MONEY FUND
AN INTERVIEW WITH RICHARD KLINGMAN, VICE PRESIDENT AND PORTFOLIO MANAGER
Q. WHAT FACTORS INFLUENCED THE MONEY MARKETS IN THE FIRST HALF OF 1999?
A. The economy entered 1999 following three quick Federal Reserve rate cuts, or
"easings" to the Federal Funds rate, in the third quarter of 1998 to combat
the global slowdown concerns resulting from the emerging market crisis. These
cuts did, in fact, stabilize the markets and the Federal Funds rate remained
at 4.75% throughout the first half of the year until June 30th , when the
Federal Reserve increased rates to 5.00%. The latest increase or "tightening"
to the Federal Funds rate was a step toward "normalizing" short-term interest
rates in response to concerns about inflationary pressures resulting from
strong domestic and improving international growth.
Q. GIVEN THIS CONTEXT, HOW DID THE FUND PERFORM?
A. For the six-month period ended June 30, 1999, Hamilton Shares of the Fund
posted a total return of 2.36%, Hamilton Premier Shares returned 2.23%, and
Hamilton Classic Shares returned 2.10%(1). For the 12-month period ended June
30, 1999, Hamilton Shares returned 5.06%, Hamilton Premier Shares returned
4.80%, and Hamilton Classic Shares returned 4.51%.
The seven-day current and the 30-day effective yields for the six-month
period ended June 30, 1999 were 4.78% and 4.69%, respectively for the
Hamilton Shares; 4.53% and 4.44% for Hamilton Premier Shares; and 4.28% and
4.19% for Hamilton Classic Shares(2). During the first half of this year, the
Fund's assets grew significantly, increasing over $400 million or 16% to more
than $2.9 billion.
Q. WHAT ACCOUNTED FOR THE FUND'S PERFORMANCE?
A. The Fund seeks to achieve a competitive yield with a bias toward safety and
liquidity. For this reason, we invest in a variety of instrument types in
various sectors over the short-term yield curve, while at the same time
providing a significant overnight base of liquidity and a steady steam of
maturities. We are extremely focused on the quality of our investments and
the Fund has earned both an AAAm rating from Standard & Poor's Corporation
and an Aaa rating from Moody's Investor Services. These ratings signify that
the Fund's safety is excellent and that it has superior capacity to maintain
its $1.00 net asset value per share. Of course, there is no guarantee that it
will do so.
Q. HOW WAS THE FUND WEIGHTED?
A. The Fund remained broadly diversified with exposure to various fixed- and
variable-rate money market securities including top-rated commercial paper
(46%), bank exposure (20%), repurchase agreements (13%), corporate debt (11%)
and U.S. government and agency securities (10%). The weighted average
maturity (WAM) of the Fund was 51 days as of June 30, 1999.
17
<PAGE>
[LOGO]
Q. WHAT IS YOUR OUTLOOK FOR THE FUND?
A. The Federal Reserve, ever vigilant against inflation, may act again to raise
interest rates should there be renewed signs of growth or wage pressure.
However, we would view such Fed action as a monetary adjustment reflective of
a sound global economy. As a result, we do not anticipate significant rate
changes for the second half of 1999 and believe the economy will continue to
enjoy relatively low inflation and sustainable economic growth. The BNY
Hamilton Money Fund will continue to identify investments of significant
relative value to maintain a competitive yield and a well positioned
portfolio.
(1) TOTAL RETURN FIGURES INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE
RESULTS.
(2) YIELDS WILL FLUCTUATE WITH CHANGES IN MARKET CONDITIONS. AN INVESTMENT IN
THE FUND IS NEITHER INSURED NOR GUARANTEED BY THE FDIC OR ANY OTHER
GOVERNMENT AGENCY. ALTHOUGH THE FUND STRIVES TO MAINTAIN THE VALUE OF
YOUR INVESTMENT AT $1.00 PER SHARE, IT IS POSSIBLE TO LOSE MONEY BY
INVESTING IN THE FUND.
18
<PAGE>
[LOGO] BNY HAMILTON TREASURY MONEY FUND
AN INTERVIEW WITH RICHARD KLINGMAN, VICE PRESIDENT AND PORTFOLIO MANAGER
Q. WHAT FACTORS INFLUENCED TREASURY SECURITIES IN THE FIRST HALF OF 1999?
A. As a result of the Federal Reserve's three separate moves to cut the Federal
Funds rate during the third quarter of 1998, the yield on Treasury securities
had fallen significantly by the start of 1999. As the global economy
stabilized during the first three months of the year, much of the money which
had poured into the safe haven of the U.S. Treasury market began to move out,
causing yields to rise. This was evident particularly towards the end of the
quarter as a tightening move by the Federal Reserve appeared imminent. Also
impacting the Treasury market during the period was the fact that short-term
U.S. Treasury Bills continued to provide relatively low yields as the Federal
budget surplus significantly lowered the U.S. Treasury's funding
requirements. This reduction in supply, coupled with continued demand, kept
the yields on Treasury Bills low in relation to the overnight Fed Funds
target.
Q. GIVEN THIS CONTEXT, HOW DID THE FUND PERFORM?
A. For the six-month period ended June 30, 1999, Hamilton Shares of the Fund
posted a total return of 2.26% and Hamilton Premier Shares returned 2.15%(1).
Hamilton Classic Shares commenced operation in the second quarter of 1999 and
had a year-to-date performance of .67% and a 4.00% annualized yield since
inception(1). For the 12-month period ended June 30, 1999, Hamilton Shares of
the Fund returned 4.85% and Hamilton Premier Shares returned 4.60%.
The seven-day current and the 30-day effective yields for the six-month
period ended June 30,1999 were 4.55% and 4.47%, respectively for Hamilton
Shares; 4.30% and 4.22% for Hamilton Premier Shares; and 4.05% and 3.98% for
Hamilton Classic Shares. During the first half of the year, the Fund's assets
grew significantly, increasing over $70 million, or 10%, to more than $790
million.
Q. WHAT ARE YOUR GOALS IN MANAGING THE FUND?
A. The BNY Hamilton Treasury Money Fund is designed to provide high current
income while preserving investors' capital and maintaining a very high level
of liquidity. As a result, the Fund invests solely in U.S. Treasury
obligations and securities collateralized by U. S. Treasury obligations.
Our emphasis on quality has earned the Fund an AAAm rating from Standard
& Poor's Corporation and an Aaa rating from Moody's Investor Services. These
ratings signify that the Fund's safety is excellent and that it has superior
capacity to maintain its $1.00 net asset value per share. Of course, there is
no guarantee that it will do so.
Q. HOW WAS THE FUND WEIGHTED?
A. The Fund remained heavily weighted toward liquidity with overnight
Treasury-backed repurchase agreements representing 80% of the Fund and
Treasury Notes and Bills representing the remaining 20%. The weighted average
maturity (WAM) of the BNY Hamilton Treasury Money Fund was 39 days as of June
30, 1999.
19
<PAGE>
[LOGO]
Q. WHAT IS YOUR OUTLOOK FOR THE FUND?
A. The Federal Reserve, ever vigilant against inflation, may act again to raise
interest rates should there be renewed signs of growth or wage pressure.
However, we would view such Fed's action as a monetary adjustment reflective
of a sound global economy. As a result, we do not anticipate significant rate
changes for the second half of 1999 and believe the economy will continue to
enjoy relatively low inflation and sustainable economic growth. As the
portfolio is heavily weighted in overnight investments, the recent increase
in the Fed Funds rate and any subsequent rate change is reflected immediately
in the Fund's yield.
(1) TOTAL RETURN FIGURES INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE
RESULTS. The Advisor agreed to assume a portion of the expenses for this
Fund until June 30, 1998. Had expenses not been assumed, total return
would have been lower.
(2) YIELDS WILL FLUCTUATE WITH CHANGES IN MARKET CONDITIONS. AN INVESTMENT IN
THE FUND IS NEITHER INSURED NOR GUARANTEED BY THE FDIC OR WITH ANY OTHER
GOVERNMENT AGENCY. ALTHOUGH THE FUND STRIVES TO MAINTAIN THE VALUE OF
YOUR INVESTMENT AT $1.00 PER SHARE, IT IS POSSIBLE TO LOSE MONEY BY
INVESTING IN THE FUND.
20
<PAGE>
BNY HAMILTON EQUITY INCOME FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------- -------------
<C> <S> <C>
COMMON STOCKS--74.3%
ADVERTISING & MARKETING
SERVICES--0.5%
*90,000 Infinity Broadcasting Corp., Series A.................. $ 2,677,500
-------------
AEROSPACE AND DEFENSE--1.6%
150,000 AlliedSignal, Inc. .................................... 9,450,000
-------------
BANKING--3.8%
195,000 Fleet Financial Group, Inc. ........................... 8,653,125
380,000 Mellon Bank Corp. ..................................... 13,822,500
-------------
22,475,625
-------------
BEVERAGES--SOFT DRINKS--1.0%
250,000 Pepsi Bottling Group, Inc. ............................ 5,765,625
-------------
BUSINESS EQUIPMENT &
SERVICES--2.0%
200,000 Xerox Corp. ........................................... 11,812,500
-------------
CABLE TV SYSTEMS--1.3%
200,000 Comcast Corp. Class A.................................. 7,687,500
-------------
COMMERCIAL SERVICES--1.1%
*250,000 Republic Services, Inc. ............................... 6,187,500
-------------
COMMUNICATIONS EQUIPMENT & SYSTEMS--1.1%
70,000 Nokia Oyj, (ADR)....................................... 6,409,375
-------------
COMPUTERS--MICRO--1.1%
*90,000 Sun Microsystems, Inc. ................................ 6,198,750
-------------
CONGLOMERATES--2.4%
122,200 General Electric Co. .................................. 13,808,600
-------------
ELECTRONICS--1.8%
*190,000 American Power Conversion Corp. ....................... 3,823,750
*100,000 Solectron Corp. ....................................... 6,668,750
-------------
10,492,500
-------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------- -------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
ENTERTAINMENT--1.7%
*97,000 Imax Corp. ............................................ $ 2,182,500
*150,000 Seagram Co., Ltd. ..................................... 7,556,250
-------------
9,738,750
-------------
FINANCIAL SERVICES--DIVERSIFIED--3.7%
130,000 Merrill Lynch & Co., Inc. ............................. 10,391,875
110,000 Morgan Stanley, Dean Witter & Co. ..................... 11,275,000
-------------
21,666,875
-------------
FINANCIAL SERVICES--MORTGAGE COMPANIES--1.2%
100,000 Fannie Mae............................................. 6,837,500
-------------
FOOD PRODUCTS--1.3%
160,000 Bestfoods.............................................. 7,920,000
-------------
HOUSEHOLD & PERSONAL CARE
PRODUCTS--5.3%
90,000 Clorox Co. ............................................ 9,613,125
70,000 Colgate-Palmolive Co. ................................. 6,912,500
120,000 Maytag Corp. .......................................... 8,362,500
70,000 Procter & Gamble Co. .................................. 6,247,500
-------------
31,135,625
-------------
INSURANCE--HEALTH, LIFE &
MULTI-LINE--1.3%
65,362 American International Group, Inc. .................... 7,651,439
-------------
MEDIA--1.0%
*89,250 Clear Channel Communications, Inc. .................... 6,152,672
-------------
MEDICAL PRODUCTS & SUPPLIES--3.8%
169,200 Johnson & Johnson...................................... 16,581,600
75,000 Medtronic, Inc. ....................................... 5,840,625
-------------
22,422,225
-------------
OIL & GAS--1.3%
115,000 Schlumberger Ltd. ..................................... 7,324,062
-------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
21
<PAGE>
BNY HAMILTON EQUITY INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------- -------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
OIL--INTERNATIONAL--3.8%
162,400 Exxon Corp. ........................................... $ 12,525,100
150,000 Total Fina S.A. (ADR).................................. 9,665,625
-------------
22,190,725
-------------
PHARMACEUTICALS--0.9%
50,000 Pfizer, Inc. .......................................... 5,487,500
-------------
PHARMECEUTICALS, HEALTH CARE, COSMETIC--3.1%
100,000 American Home Products Corp. .......................... 5,750,000
180,000 Bristol-Myers Squibb Co. .............................. 12,678,750
-------------
18,428,750
-------------
RAILROADS--2.1%
180,000 Canadian National Railway Co. ......................... 12,060,000
-------------
REAL ESTATE INVESTMENT TRUSTS--8.8%
175,000 Apartment Investment & Management Co. ................. 7,481,250
175,000 Avalonbay Communities, Inc. ........................... 6,475,000
320,000 Duke Weeks Realty Corp. ............................... 7,220,000
135,000 Equity Residential Properties Trust.................... 6,083,437
200,000 General Growth Properties, Inc. ....................... 7,100,000
300,000 Mack-Cali Realty Corp. ................................ 9,281,250
400,000 ProLogis Trust......................................... 8,100,000
-------------
51,740,937
-------------
RETAIL--DISCOUNT STORES--1.0%
*75,000 Costco Cos., Inc. ..................................... 6,004,688
-------------
RETAIL--GENERAL MERCHANDISE--1.5%
150,000 Lowe's Companies, Inc. ................................ 8,503,125
-------------
RETAIL--SPECIALTY STORES--1.6%
100,000 Circuit City Stores-Circuit City Group................. 9,300,000
-------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------- -------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
TELECOMMUNICATIONS--6.6%
200,000 Lucent Technologies, Inc. ............................. $ 13,487,500
*150,000 MCI WorldCom, Inc. .................................... 12,909,375
210,000 SBC Communications, Inc. .............................. 12,180,000
-------------
38,576,875
-------------
UTILITIES--ELECTRIC--1.2%
100,000 Montana Power Co. ..................................... 7,050,000
-------------
UTILITIES--GAS & ELECTRIC--4.4%
140,000 Enron Corp. ........................................... 11,445,000
100,000 Texas Utilities Co. ................................... 4,125,000
245,000 Williams Cos., Inc. ................................... 10,427,813
-------------
25,997,813
-------------
UTILITIES--WATER--1.0%
192,100 American Water Works Co., Inc. ........................ 5,907,075
-------------
TOTAL COMMON STOCKS
(Cost $301,740,162).................................... 435,062,111
-------------
</TABLE>
<TABLE>
<C> <S> <C>
CONVERTIBLE PREFERRED STOCKS--15.4%
AUTOMOTIVE PARTS &
EQUIPMENT--0.8%
80,000 Federal-Mogul Financial Trust**........................ 4,730,000
-------------
BANKING--0.6%
30,000 Jefferson-Pilot Corp. NB (ACES) (a).................... 3,690,000
-------------
ENTERTAINMENT--0.4%
*50,000 Seagram Co., Ltd. ..................................... 2,496,875
-------------
FINANCIAL SERVICES--0.8%
120,000 Conseco Finance Trust, Series F........................ 4,822,500
-------------
FOOD PROCESSING--0.6%
70,000 Ralston Purina Co. (b)................................. 3,255,000
-------------
INSURANCE--0.4%
40,000 PLC Cap Trust II....................................... 2,320,000
-------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
22
<PAGE>
BNY HAMILTON EQUITY INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------- -------------
<C> <S> <C>
CONVERTIBLE PREFERRED STOCKS (CONTINUED)
MANUFACTURING--CONSUMER
PRODUCTS--1.2%
120,000 Newell Financial Trust I............................... $ 6,720,000
-------------
MEDIA--1.1%
40,000 Evergreen Media Corp.**................................ 4,410,000
13,500 Tribune Co., 2%, 05/15/29.............................. 1,724,625
-------------
6,134,625
-------------
OIL & GAS--0.6%
100,000 Apache Corp. .......................................... 3,700,000
-------------
PARKING FACILITIES--0.2%
60,000 Central Parking Financial Trust........................ 1,222,500
-------------
REAL ESTATE INVESTMENT TRUSTS--0.2%
50,000 Apartment Investment & Management Co. ................. 1,346,875
-------------
RETAIL--GENERAL MERCHANDISE--0.6%
80,000 Merrill Lynch DG STRYPES (c)........................... 3,430,000
-------------
RETAIL--SPECIALTY STORES--0.5%
33,000 Estee Lauder Auto Com Exchange......................... 3,110,250
-------------
TELECOMMUNICATIONS--3.0%
121,120 Comcast Corp........................................... 10,476,880
20,000 TCI Pacific Communications, Inc., Series A............. 6,833,240
-------------
17,310,120
-------------
TELECOMMUNICATIONS--NON-U.S.--1.9%
100,000 Global Telesystems Group............................... 6,600,000
51,000 MediaOne (Vodaphone)................................... 4,615,500
-------------
11,215,500
-------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------- -------------
<C> <S> <C>
CONVERTIBLE PREFERRED STOCKS (CONTINUED)
UTILITIES--GAS & ELECTRIC--2.5%
70,000 AES Trust II**......................................... $ 4,042,500
100,000 Nisource, Inc. ........................................ 4,937,500
100,000 Texas Utilities Co. ................................... 5,500,000
-------------
14,480,000
-------------
TOTAL CONVERTIBLE PREFERRED STOCKS
(Cost $77,036,996)..................................... 89,984,245
-------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
- -----------
<C> <S> <C>
CONVERTIBLE BONDS--8.9%
COMPUTERS--SOFTWARE &
PERIPHERALS--1.0%
$ 2,500,000 VERITAS Software Corp., 5.25%, 11/01/04................ 5,859,375
-------------
ENTERTAINMENT--0.3%
1,500,000 Imax Corp.,
5.75%, 04/01/03**...................................... 1,783,125
-------------
HEALTH CARE PRODUCTS &
SERVICES--1.9%
5,100,000 Alza Corp.,
5.00%, 05/01/06........................................ 6,993,375
3,000,000 Genzyme Corp.,
5.25%, 06/01/05........................................ 4,222,500
-------------
11,215,875
-------------
HUMAN RESOURCES--0.5%
1,980,000 Interim Services, Inc., 4.50%, 06/01/05**.............. 1,697,850
1,500,000 Personnel Group of America, Inc.,
5.75%, 07/01/04........................................ 1,276,875
-------------
2,974,725
-------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
23
<PAGE>
BNY HAMILTON EQUITY INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- -------------
<C> <S> <C>
CONVERTIBLE BONDS (CONTINUED)
INDUSTRIAL & COMMERCIAL
SERVICES--0.5%
$ 2,250,000 Waste Management, Inc., 4.00%, 02/01/02................ $ 2,961,563
-------------
MANUFACTURING AND DESIGN TECHNOLOGY--1.7%
2,000,000 EMC Corp.,
3.25%, 03/15/02**...................................... 9,865,000
-------------
MEDIA--0.8%
3,750,000 Clear Channel Communications, Inc., 2.625%, 04/01/03... 4,762,500
-------------
MEDICAL PRODUCTS & SUPPLIES--0.8%
4,000,000 Centocor, Inc.,
4.75%, 02/15/05**...................................... 4,485,000
-------------
OIL & GAS--0.7%
4,000,000 Diamond Offshore Drilling, 3.75%, 02/15/07............. 3,950,000
-------------
SEMICONDUCTOR--0.7%
2,000,000 Level One (Intel) Communications, 4.00%, 09/01/04...... 3,917,500
-------------
TOTAL CONVERTIBLE BONDS
(Cost $37,579,937)..................................... 51,774,663
-------------
</TABLE>
<TABLE>
<C> <S> <C>
MONEY MARKET FUND--1.4%
8,344,275 ACM Institutional Reserves (Prime Portfolio), 4.90%(d)
(Cost $8,344,275)...................................... 8,344,275
-------------
TOTAL INVESTMENTS BEFORE OUTSTANDING WRITTEN CALL
OPTIONS
(Cost $424,701,370)(e)................................. 585,165,294
-------------
</TABLE>
<TABLE>
<CAPTION>
STRIKE
CONTRACTS PRICE VALUE
- ----------- ------ -------------
<C> <S> <C> <C>
OUTSTANDING WRITTEN CALL OPTIONS-- (0.1%)
(400) Merrill Lynch Co., expiration July
1999.................................... $ 80 $ (125,000)
(350) Morgan Stanley, Dean Witter, Discover &
Co., expiration July 1999............... 100 (175,000)
-------------
TOTAL OUTSTANDING WRITTEN CALL OPTIONS
(Premiums received $188,993)........................... (300,000)
-------------
</TABLE>
TOTAL INVESTMENTS NET OF OUTSTANDING
WRITTEN CALL OPTIONS
(Cost $424,512,377)--99.9%.............. 584,865,294
Other assets less liabilities-- 0.1%.... 453,101
-------------
NET ASSETS--100.0%...................... $ 585,318,395
-------------
-------------
ACES AUTOMATIC COMMON EXCHANGE SECURITIES.
ADR AMERICAN DEPOSITORY RECEIPT.
STRYPES STRUCTURED YIELD PRODUCT EXCHANGEABLE FOR STOCK.
* NON-INCOME PRODUCING SECURITY.
** SECURITY EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE SECURITIES ACT OF
1933.
(a) CONVERTIBLE TO BANKAMERICA CORP. COMMON STOCK.
(b) CONVERTIBLE TO INTERSTATE BAKERIES COMMON STOCK.
(c) CONVERTIBLE TO DOLLAR GENERAL CORP. COMMON STOCK.
(d) REPRESENTS ANNUALIZED YIELD AT JUNE 30, 1999.
(e) THE COST STATED ALSO APPROXIMATES THE AGGREGATE COST FOR FEDERAL INCOME TAX
PURPOSES. AT JUNE 30, 1999, NET UNREALIZED APPRECIATION WAS $160,463,924
BASED ON COST FOR FEDERAL INCOME TAX PURPOSES. THIS CONSISTED OF AGGREGATE
GROSS UNREALIZED APPRECIATION OF $168,792,173 AND AGGREGATE GROSS
UNREALIZED DEPRECIATION OF $8,328,249.
SEE NOTES TO FINANCIAL STATEMENTS.
24
<PAGE>
BNY HAMILTON EQUITY INCOME FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at value
(Cost $424,701,370)..................................... $585,165,294
Cash...................................................... 31,230
Receivables:
Dividends............................................... 542,212
Interest................................................ 455,493
Capital stock sold...................................... 189,585
Investments sold........................................ 13,863
Other assets.............................................. 1,620
------------
TOTAL ASSETS.......................................... 586,399,297
------------
LIABILITIES:
Outstanding call options written
(premium received $188,993)............................. 300,000
Payables:
Services provided by the Bank of New York and
Administrator......................................... 450,228
Capital stock repurchased............................... 179,340
Accrued expenses and other liabilities.................... 151,334
------------
TOTAL LIABILITIES..................................... 1,080,902
------------
NET ASSETS:................................................. $585,318,395
------------
------------
SOURCES OF NET ASSETS:
Capital stock @ par....................................... $ 32,841
Capital surplus........................................... 361,843,056
Undistributed net investment income....................... 610,409
Accumulated net realized gain on investments.............. 62,479,172
Net unrealized appreciation on investments................ 160,352,917
------------
NET ASSETS.................................................. $585,318,395
------------
------------
INSTITUTIONAL SHARES:
Net assets................................................ $544,396,817
------------
------------
Shares outstanding........................................ 30,539,517
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 17.83
------------
------------
INVESTOR SHARES:
Net assets................................................ $ 40,921,578
------------
------------
Shares outstanding........................................ 2,301,383
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 17.78
------------
------------
Institutional Shares authorized @ $.001 par value........... 200,000,000
Investor Shares authorized @ $.001 par value................ 200,000,000
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $18,276)... $ 5,603,036
Interest.................................................. 1,373,962
-----------
TOTAL INCOME............................................ 6,976,998
-----------
EXPENSES:
Advisory.................................................. 1,705,655
Administration............................................ 568,552
12b-1 fee--Investor Shares................................ 46,566
Transfer agent............................................ 67,918
Custodian................................................. 50,022
Reports to shareholders................................... 41,710
Registration and filings.................................. 40,328
Accounting services....................................... 29,747
Insurance................................................. 13,682
Legal..................................................... 13,577
Audit..................................................... 10,450
Cash management........................................... 9,695
Directors................................................. 7,812
Other..................................................... 15,284
-----------
TOTAL EXPENSES.......................................... 2,620,998
Earnings credit adjustment (Note 3)..................... (2,278)
-----------
NET EXPENSES............................................ 2,618,720
-----------
NET INVESTMENT INCOME................................... 4,358,278
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain on:
Investments............................................. 55,033,276
Written call options.................................... 163,194
-----------
Net realized gain on investments.......................... 55,196,470
-----------
Decrease in unrealized
appreciation on:
Investments............................................. (13,225,681)
Written call options.................................... (111,007)
-----------
Net unrealized loss on investments during the period...... (13,336,688)
-----------
Net realized and unrealized gain on investments........... 41,859,782
-----------
Net increase in net assets resulting from operations...... $46,218,060
-----------
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
25
<PAGE>
BNY HAMILTON EQUITY INCOME FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR
SIX MONTHS ENDED ENDED
JUNE 30, 1999 DECEMBER 31,
(UNAUDITED) 1998
----------------- ----------------
<S> <C> <C>
OPERATIONS:
Net investment income............................................... $ 4,358,278 $ 9,759,306
Net realized gain on investments.................................... 55,196,470 30,042,130
Increase/(decrease) in unrealized appreciation on investments during
the period........................................................ (13,336,688) 30,647,552
----------------- ----------------
Net increase in net assets resulting from operations.............. 46,218,060 70,448,988
----------------- ----------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income: Institutional Shares.......... (3,897,030) (8,618,820)
Investor Shares............... (230,057) (536,948)
Distributions from capital gains: Institutional Shares.............. -0- (21,865,292)
Investor Shares................... -0- (1,528,489)
----------------- ----------------
(4,127,087) (32,549,549)
----------------- ----------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Institutional Shares.............. 24,545,790 26,979,380
Investor Shares................... 17,321,984 4,116,015
Proceeds from shares issued on reinvestment of dividends
and distributions: Institutional Shares........................... 1,145,497 24,111,829
Investor Shares..................................... 212,953 1,987,895
Cost of capital stock repurchased: Institutional Shares............. (48,857,283) (81,028,870)
Investor Shares.................. (16,586,351) (5,358,164)
----------------- ----------------
Net increase (decrease) in net assets resulting from capital stock
transactions.................................................... (22,217,410) (29,191,915)
----------------- ----------------
INCREASE IN NET ASSETS.......................................... 19,873,563 8,707,524
NET ASSETS:
Beginning of period................................................. 565,444,832 556,737,308
----------------- ----------------
End of period (includes undistributed net investment income of
$610,409 at June 30, 1999 and $379,218 at December 31, 1998)...... $585,318,395 $ 565,444,832
----------------- ----------------
----------------- ----------------
CHANGES IN CAPITAL STOCK OUTSTANDING:
Shares sold: Institutional Shares................................... 1,465,023 1,699,962
Investor Shares........................................ 1,003,099 253,791
Shares issued on reinvestment of dividends
and distributions: Institutional Shares........................... 67,434 1,487,475
Investor Shares....................................................... 12,558 122,592
Shares repurchased: Institutional Shares............................ (2,871,000) (4,940,940)
Investor Shares................................. (965,133) (328,881)
----------------- ----------------
Net decrease...................................................... (1,288,019) (1,706,001)
Shares outstanding, beginning of period............................. 34,128,919 35,834,920
----------------- ----------------
Shares outstanding, end of period................................... 32,840,900 34,128,919
----------------- ----------------
----------------- ----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
26
<PAGE>
BNY HAMILTON EQUITY INCOME FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL SHARES
--------------------------------------------------------------
SIX MONTHS FOR THE PERIOD
ENDED YEAR APRIL 1, 1997*
JUNE 30, 1999 ENDED THROUGH
(UNAUDITED) DECEMBER 31, 1998 DECEMBER 31, 1997
-------------- --------------------- ---------------------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period................................ $ 16.57 $ 15.54 $ 14.21
-------------- -------- --------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.21 0.28 0.25
Net realized and unrealized gain on
investments........................... 1.26 1.73 3.25
-------------- -------- --------
Total from investment operations...... 1.47 2.01 3.50
-------------- -------- --------
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income.... (0.21) (0.27) (0.24)
Distributions from capital gains........ -- (0.71) (1.93)
-------------- -------- --------
Total dividends and distributions..... (0.21) (0.98) (2.17)
-------------- -------- --------
Net asset value at end of period........ $ 17.83 $ 16.57 $ 15.54
-------------- -------- --------
-------------- -------- --------
TOTAL RETURN:........................... 8.39%** 13.18% 24.73%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $544,397 $528,233 $522,524
Ratio to average net assets of:
Expenses.............................. .91%*** 0.89% 0.87%***
Net investment income................. 1.55%*** 1.77% 2.07%***
Portfolio turnover rate................. 32% 39% 65%
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
** NOT ANNUALIZED.
*** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
27
<PAGE>
BNY HAMILTON EQUITY INCOME FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INVESTOR SHARES
-------------------------------------------------------------------------
SIX
MONTHS
ENDED
JUNE 30, YEAR ENDED DECEMBER 31,
1999 ------------------------------------------------------------
(UNAUDITED) 1998 1997 1996 1995 1994
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period................................ $ 16.53 $ 15.53 $ 14.12 $ 12.99 $ 10.70 $ 11.30
-------- -------- -------- -------- -------- --------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.20 0.25 0.35 0.30 0.32 0.31
Net realized and unrealized gain (loss)
on investments........................ 1.25 1.71 3.27 2.22 2.41 (0.60)
-------- -------- -------- -------- -------- --------
Total from investment operations...... 1.45 1.96 3.62 2.52 2.73 (0.29)
-------- -------- -------- -------- -------- --------
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income.... (0.20) (0.25) (0.28) (0.29) (0.32) (0.31)
Distributions from capital gains........ -- (0.71) (1.93) (1.10) (0.12) -0-
-------- -------- -------- -------- -------- --------
Total dividends and distributions..... (0.20) (0.96) (2.21) (1.39) (0.44) (0.31)
-------- -------- -------- -------- -------- --------
Net asset value at end of year.......... $ 17.78 $ 16.53 $ 15.53 $ 14.12 $ 12.99 $ 10.70
-------- -------- -------- -------- -------- --------
-------- -------- -------- -------- -------- --------
TOTAL RETURN:+.......................... 8.25%* 12.82% 25.85% 19.58% 25.78% (2.58)%
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $40,922 $ 37,212 $ 34,213 $216,363 $169,841 $135,131
Ratio to average net assets of:
Expenses.............................. 1.15%** 1.17% 1.01% 0.97% 1.00% 1.04%
Net investment income................. 1.30%** 1.50% 1.77% 2.17% 2.66% 2.89%
Portfolio turnover rate................. 32% 39% 65% 58% 58% 51%
</TABLE>
+ TOTAL RETURN DOES NOT CONSIDER THE EFFECT OF THE SALES LOAD FOR THOSE
PERIODS IN WHICH THE SALES LOAD WAS IN EFFECT.
* NOT ANNUALIZED.
** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
28
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------- ------------
<C> <S> <C>
COMMON STOCKS--94.5%
BANKING--3.0%
217,000 First Union Corp. ...................... $ 10,199,000
128,932 Wells Fargo & Co. ...................... 5,511,843
------------
15,710,843
------------
BEVERAGES--1.4%
114,467 Coca-Cola Co. .......................... 7,154,187
------------
BUSINESS SERVICES--1.1%
100,000 Frontier Corp. ......................... 5,900,000
------------
CHEMICALS--DIVERSIFIED--2.1%
160,146 duPont (E.I.) de
Nemours & Co. .......................... 10,939,974
------------
COMMUNICATIONS &
ENTERTAINMENT--2.3%
163,158 Time Warner, Inc. ...................... 11,992,113
------------
COMMUNICATIONS EQUIPMENT & SYSTEMS--5.4%
25,000 America Online, Inc. ................... 2,762,500
170,000 Nokia Oyj, (ADR)........................ 15,565,625
15,000 Razorfish, Inc. ........................ 555,937
130,000 Tellabs, Inc. .......................... 8,783,125
------------
27,667,187
------------
COMPUTER SERVICES--2.4%
121,660 Hewlett-Packard Co. .................... 12,226,830
------------
COMPUTERS--MICRO--1.6%
*120,000 Sun Microsystems, Inc. ................. 8,265,000
------------
COMPUTERS--SOFTWARE &
PERIPHERALS--7.5%
*344,560 Cisco Systems, Inc. .................... 22,159,515
*187,296 Microsoft Corp. ........................ 16,891,758
------------
39,051,273
------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------- ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
CONGLOMERATES--2.5%
113,146 General Electric Co. ................... $ 12,785,498
------------
COSMETICS & TOILETRIES--1.0%
130,016 Gillette Co. ........................... 5,330,656
------------
FINANCIAL SERVICES--DIVERSIFIED--4.7%
297,706 Citigroup, Inc. ........................ 14,141,035
97,100 Morgan Stanley, Dean Witter & Co. ...... 9,952,750
------------
24,093,785
------------
FINANCIAL SERVICES--MORTGAGE COMPANIES--2.3%
171,725 Fannie Mae.............................. 11,741,697
------------
FOOD PRODUCTS--1.9%
198,018 Bestfoods............................... 9,801,891
------------
HOUSEHOLD & PERSONAL CARE
PRODUCTS--2.0%
116,938 Procter & Gamble Co. ................... 10,436,716
------------
INSURANCE--2.1%
200,000 Unum Corp. ............................. 10,950,000
------------
INSURANCE--HEALTH, LIFE &
MULTI-LINE--2.8%
124,517 American International Group, Inc. ..... 14,576,271
------------
MANUFACTURING AND DESIGN TECHNOLOGY--3.8%
110,000 Applied Materials, Inc. ................ 8,126,250
210,000 EMC Corp. .............................. 11,550,000
------------
19,676,250
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
29
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------- ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
MANUFACTURING--CONSUMER
PRODUCTS--4.0%
163,000 Corning, Inc. .......................... $ 11,430,375
197,080 Newell Co. ............................. 9,164,220
------------
20,594,595
------------
MEDICAL PRODUCTS & SUPPLIES--5.6%
60,000 Centocor, Inc. ......................... 2,797,500
147,455 Johnson & Johnson....................... 14,450,590
151,000 Medtronic, Inc. ........................ 11,759,125
------------
29,007,215
------------
OIL & GAS--1.6%
129,390 Schlumberger Ltd. ...................... 8,240,526
------------
OIL--INTERNATIONAL--6.1%
176,084 Exxon Corp. ............................ 13,580,478
141,000 Mobil Corp. ............................ 13,959,000
62,992 Royal Dutch Petroleum Co. .............. 3,795,268
------------
31,334,746
------------
PHARMACEUTICALS--8.7%
*70,252 Amgen, Inc. ............................ 4,276,591
70,000 Biogen, Inc. ........................... 4,501,875
146,538 Merck & Co. ............................ 10,843,812
124,116 Pfizer, Inc. ........................... 13,621,731
175,000 Smithkline Beechman PLC (ADR)........... 11,560,938
------------
44,804,947
------------
REAL ESTATE INVESTMENT TRUSTS--1.4%
174,000 Duke Weeks Realty Corp.................. 3,925,875
140,000 Liberty Property Trust.................. 3,482,500
------------
7,408,375
------------
RESORTS & ENTERTAINMENT--2.1%
360,000 Walt Disney Co. (The)................... 11,092,500
------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------- ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
RETAIL--SPECIALTY STORES--3.2%
226,890 CVS Corp. .............................. $ 11,514,668
150,000 Williams-Sonoma, Inc. .................. 5,221,875
------------
16,736,543
------------
SEMICONDUCTORS--2.1%
185,552 Intel Corp. ............................ 11,040,344
------------
TELECOMMUNICATIONS--6.5%
65,497 Global Crossing Ltd. ................... 2,791,810
163,604 Lucent Technologies, Inc. .............. 11,033,045
*156,000 MCI WorldCom, Inc. ..................... 13,425,750
200,000 Qwest Communications International,
Inc. ................................... 6,612,500
------------
33,863,105
------------
UTILITIES--GAS & ELECTRIC--3.3%
159,976 Enron Corp. ............................ 13,078,038
93,253 Texas Utilities Co. .................... 3,846,686
------------
16,924,724
------------
TOTAL COMMON STOCKS
(Cost $235,683,725)..................... 489,347,791
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
- -----------
<C> <S> <C>
UNITED STATES TREASURY
BILL--3.4%
$17,505,000 4.73%, 7/22/99
(Amortized Cost $17,462,623)............ 17,462,515
------------
</TABLE>
MONEY MARKET FUND--2.1%
10,893,182 ACM Institutional Reserves (Prime
Portfolio), 4.90% (a) (Cost
$10,893,182)............................ 10,893,182
------------
SEE NOTES TO FINANCIAL STATEMENTS.
30
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
STRIKE
CONTRACTS PRICE VALUE
- ----------- ------ -------------
<C> <S> <C> <C>
PURCHASED CALL OPTIONS--0.1%
147 S & P 100, expiration August, 1999
(Cost $312,816)......................... 690 $ 441,000
-------------
TOTAL INVESTMENTS BEFORE OUTSTANDING WRITTEN
CALL AND PUT OPTIONS
(Cost $264,352,346) (b)-- 100.1%................ 518,144,488
-------------
</TABLE>
OUTSTANDING WRITTEN CALL OPTIONS--(0.0%)
(100) Applied Materials, Inc., expiration
July, 1999.............................. 75 (26,250)
(400) Cisco Systems, Inc., expiration July,
1999.................................... 65 (72,500)
(100) duPont (E.I.) de Nemours & Co.,
expiration July, 1999................... 75 (1,875)
(100) EMC Corp., expiration July, 1999........ 60 (8,750)
(100) Nokia Corp., expiration July, 1999...... 90 (37,500)
(100) Qwest Communications International,
Inc., expiration July, 1999............. 40 (1,875)
<TABLE>
<CAPTION>
STRIKE
CONTRACTS PRICE VALUE
- ----------- ------ -------------
<C> <S> <C> <C>
(200) Smithkline Beechman PLC, expiration
July, 1999.............................. 70 $ (15,000)
(100) Sun Microsystems, Inc., expiration July,
1999.................................... 68 (33,750)
(100) Tellabs, Inc., expiration July, 1999.... 70 (22,500)
-------------
TOTAL OUTSTANDING WRITTEN CALL OPTIONS
(Premiums received $197,944).................... (220,000)
-------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
OUTSTANDING WRITTEN PUT OPTIONS--(0.1%)
(100) Applied Materials, Inc., expiration
July, 1999.............................. 60 (2,500)
(400) Cisco Systems, Inc., expiration July,
1999.................................... 53 (2,500)
(100) duPont (E.I.) de Nemours & Co.,
expiration July, 1999................... 65 (5,000)
(100) EMC Corp., expiration July, 1999........ 50 (6,250)
(100) Qwest Communications International,
Inc., expiration July, 1999............. 33 (10,625)
(147) S & P 100, expiration August, 1999...... 690 (226,013)
(100) Sun Microsystems, Inc., expiration July,
1999.................................... 55 (1,875)
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
31
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
STRIKE
CONTRACTS PRICE VALUE
- ----------- ------ -------------
<C> <S> <C> <C>
OUTSTANDING WRITTEN PUT OPTIONS (CONTINUED)
(100) Tellabs, Inc., expiration July, 1999.... 60 $ (6,250)
-------------
TOTAL OUTSTANDING WRITTEN PUT OPTIONS
(Premiums received $513,342).................... (261,013)
-------------
</TABLE>
<TABLE>
<C> <S> <C>
TOTAL INVESTMENTS NET OF OUTSTANDING WRITTEN
CALL AND PUT OPTIONS
(Cost $263,641,060)--100%....................... 517,663,475
Other assets less liabilities-- 0.0%............ (3,732)
-------------
NET ASSETS--100.0%.............................. $ 517,659,743
-------------
-------------
</TABLE>
ADR AMERICAN DEPOSITORY RECEIPT.
* NON-INCOME PRODUCING SECURITY.
(a) REPRESENTS ANNUALIZED YIELD AT JUNE 30, 1999.
(b) THE COST STATED ALSO APPROXIMATES THE AGGREGATE COST FOR FEDERAL INCOME TAX
PURPOSES. AT JUNE 30, 1999, NET UNREALIZED APPRECIATION WAS $253,792,142
BASED ON COST FOR FEDERAL INCOME TAX PURPOSES. THIS CONSISTED OF AGGREGATE
GROSS UNREALIZED APPRECIATION OF $255,546,514 AND AGGREGATE GROSS
UNREALIZED DEPRECIATION OF $1,754,372.
SEE NOTES TO FINANCIAL STATEMENTS.
32
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at value
(Cost $264,352,346)..................................... $518,144,488
Cash...................................................... 910,066
Receivables:
Investments sold........................................ 1,054,370
Dividends............................................... 301,655
Capital stock sold...................................... 261,542
Interest................................................ 117,619
Deferred organization costs and other assets.............. 52,951
------------
TOTAL ASSETS.......................................... 520,842,691
------------
LIABILITIES:
Outstanding call and put options written (premiums
received $711,286)...................................... 481,013
Payables:
Capital stock repurchased............................... 2,237,755
Services provided by the Bank of New York and
Administrator......................................... 357,392
Accrued expenses and other liabilities.................... 106,788
------------
TOTAL LIABILITIES..................................... 3,182,948
------------
NET ASSETS:................................................. $517,659,743
------------
------------
SOURCES OF NET ASSETS:
Capital stock @ par....................................... $ 35,294
Capital surplus........................................... 225,131,933
Undistributed net investment income....................... 214,110
Accumulated net realized gain on investments.............. 38,255,991
Net unrealized appreciation on investments................ 254,022,415
------------
NET ASSETS.................................................. $517,659,743
------------
------------
INSTITUTIONAL SHARES:
Net assets................................................ $503,020,917
------------
------------
Shares outstanding........................................ 34,291,327
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 14.67
------------
------------
INVESTOR SHARES:
Net assets................................................ $ 14,638,826
------------
------------
Shares outstanding........................................ 1,003,027
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 14.59
------------
------------
Institutional Shares authorized @ $.001
par value................................................. 200,000,000
Investor Shares authorized @ $.001 par value................ 200,000,000
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $22,357)... $ 2,375,389
Interest.................................................. 742,294
------------
TOTAL INCOME............................................ 3,117,683
------------
EXPENSES:
Advisory.................................................. 1,452,296
Administration............................................ 484,098
12b-1 fee--Investor Shares................................ 16,085
Transfer agent............................................ 54,759
Accounting services....................................... 29,744
Custodian................................................. 28,784
Reports to shareholders................................... 26,896
Registration and filings.................................. 18,048
Legal..................................................... 13,723
Audit..................................................... 10,983
Organization.............................................. 8,856
Directors................................................. 7,812
Insurance................................................. 7,010
Cash management........................................... 2,753
Other..................................................... 9,285
------------
TOTAL EXPENSES.......................................... 2,171,132
Fees waived by the Bank of New York (Note 3).............. (97,961)
Earnings credit adjustment (Note 3)....................... (1,177)
------------
NET EXPENSES............................................ 2,071,994
------------
NET INVESTMENT INCOME................................... 1,045,689
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on:
Investments............................................. 32,429,202
Written call options.................................... 51,285
------------
Net realized gain on investments.......................... 32,480,487
------------
Increase in unrealized appreciation on:
Investments............................................. 36,837,199
Written call options.................................... 358,458
------------
Net unrealized gain on investments during the period...... 37,195,657
------------
Net realized and unrealized gain on investments........... 69,676,144
------------
Net increase in net assets resulting from operations...... $ 70,721,833
------------
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
33
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR
SIX MONTHS ENDED ENDED
JUNE 30, 1999 DECEMBER 31,
(UNAUDITED) 1998
----------------- ----------------
<S> <C> <C>
OPERATIONS:
Net investment income............................................... $ 1,045,689 $ 2,976,961
Net realized gain on investments.................................... 32,480,487 31,454,367
Increase in unrealized appreciation on investments during the
period............................................................ 37,195,657 54,370,500
----------------- ----------------
Net increase in net assets resulting from operations.............. 70,721,833 88,801,828
----------------- ----------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income: Institutional Shares.......... (911,747) (2,846,174)
Investor Shares............... (14,521) (74,955)
Distributions from capital gains: Institutional Shares.............. -0- (23,566,674)
Investor Shares................... -0- (561,749)
----------------- ----------------
(926,268) (27,049,552)
----------------- ----------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Institutional Shares.............. 43,475,170 48,105,075
Investor Shares................... 23,833,165 11,499,724
Proceeds from shares issued on reinvestment of dividends
and distributions: Institutional Shares........................... 174,296 22,917,754
Investor Shares................................ 14,382 632,192
Cost of capital stock repurchased: Institutional Shares............. (52,524,022) (60,262,412)
Investor Shares.................. (22,152,719) (9,391,039)
----------------- ----------------
Net increase (decrease) in net assets resulting from capital stock
transactions.................................................... (7,179,728) 13,501,294
----------------- ----------------
INCREASE IN NET ASSETS.......................................... 62,615,837 75,253,570
NET ASSETS:
Beginning of period................................................. 455,043,906 379,790,336
----------------- ----------------
End of period (includes undistributed net investment income of
$214,110 at June 30, 1999 and $94,689 at December 31, 1998)....... $517,659,743 $ 455,043,906
----------------- ----------------
----------------- ----------------
CHANGES IN CAPITAL STOCK OUTSTANDING:
Shares sold: Institutional Shares................................... 3,152,865 3,974,655
Investor Shares........................................ 1,775,800 974,111
Shares issued on reinvestment of dividends
and distributions: Institutional Shares........................... 12,929 1,833,466
Investor Shares................................ 1,101 50,958
Shares repurchased: Institutional Shares............................ (3,820,549) (4,996,137)
Investor Shares................................. (1,646,982) (743,808)
----------------- ----------------
Net increase (decrease)........................................... (524,836) 1,093,245
Shares outstanding, beginning of period............................. 35,819,190 34,725,945
----------------- ----------------
Shares outstanding, end of period................................... 35,294,354 35,819,190
----------------- ----------------
----------------- ----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
34
<PAGE>
BNY HAMILTON LARGE CAP GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL SHARES INVESTOR SHARES
----------------------------------------------- ----------------------------
FOR THE
PERIOD
SIX MONTHS YEAR APRIL 1, 1997* SIX MONTHS YEAR
ENDED JUNE ENDED THROUGH ENDED JUNE ENDED
30, 1999 DECEMBER 31, DECEMBER 31, 30, 1999 DECEMBER 31,
(UNAUDITED) 1998 1997 (UNAUDITED) 1998
------------ ------------- ---------------- ------------ -------------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period.. $ 12.71 $ 10.94 $ 10.00 $ 12.65 $ 10.92
------------ ------------- -------- ------------ -------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.04 0.11 0.08 0.02 0.11
Net realized and unrealized gain on
investments........................... 1.96 2.46 2.83 1.94 2.42
------------ ------------- -------- ------------ -------------
Total from investment operations...... 2.00 2.57 2.91 1.96 2.53
------------ ------------- -------- ------------ -------------
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment
income................................ (0.04) (0.11) (0.08) (0.02) (0.11)
Distributions from capital gains........ -- (0.69) (1.89) -- (0.69)
------------ ------------- -------- ------------ -------------
Total dividends and distributions..... (0.04) (0.80) (1.97) (0.02) (0.80)
------------ ------------- -------- ------------ -------------
Net asset value at end of period........ $ 14.67 $ 12.71 $ 10.94 $ 14.59 $ 12.65
------------ ------------- -------- ------------ -------------
------------ ------------- -------- ------------ -------------
TOTAL RETURN:........................... 15.83%** 23.49% 29.11%** 15.57%** 23.26%
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $503,021 $443,997 $373,326 $14,639 $11,047
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 0.85%*** 0.82% 0.82%*** 1.14%*** 1.07%
Expenses, prior to waiver from The
Bank of New York.................... 0.89%*** 0.91% 0.88%*** 1.21%*** 1.21%
Net investment income, net of waiver
from The Bank of New York........... 0.44%*** 0.73% 0.89%*** 0.16%*** 0.50%
Portfolio turnover rate................. 11% 26% 37% 11% 26%
<CAPTION>
FOR THE
PERIOD
MAY 1, 1997*
THROUGH
DECEMBER 31,
1997
-------------
<S> <C>
PER SHARE DATA:
Net asset value at beginning of period.. $10.70
------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.06
Net realized and unrealized gain on
investments........................... 2.12
------
Total from investment operations...... 2.18
------
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment
income................................ (0.07)
Distributions from capital gains........ (1.89)
------
Total dividends and distributions..... (1.96)
------
Net asset value at end of period........ $10.92
------
------
TOTAL RETURN:........................... 20.37%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $6,464
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 1.07%***
Expenses, prior to waiver from The
Bank of New York.................... 1.16%***
Net investment income, net of waiver
from The Bank of New York........... 0.54%***
Portfolio turnover rate................. 37%
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS FOR THE RESPECTIVE CLASS OF SHARES.
** NOT ANNUALIZED.
*** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
35
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- --------- ------------
<C> <S> <C>
COMMON STOCKS--97.0%
ADVERTISING & MARKETING
SERVICES--3.1%
*46,425 DoubleClick, Inc. ...................... $ 4,259,494
*319,269 Ha-Lo Industries, Inc. ................. 3,152,781
------------
7,412,275
------------
BANKING--0.4%
54,300 Peoples Heritage Financial Group,
Inc. ................................... 1,021,519
------------
BIOSCIENCES--0.5%
*160,075 Aurora Biosciences Corp. ............... 1,160,544
------------
CABLE TV SYSTEMS--3.7%
*70,600 Adelphia Communications Corp. .......... 4,491,925
*85,750 Jones Intercable, Inc. ................. 4,201,750
------------
8,693,675
------------
COMMERCIAL SERVICES--0.7%
*22,600 FirstService Corp. ..................... 344,650
28,200 Profit Recovery Group International,
Inc. ................................... 1,334,212
------------
1,678,862
------------
COMPUTER SERVICES--5.2%
*4,535 Ariba, Inc. ............................ 441,029
*52,200 Data General Corp. ..................... 760,162
*21,200 Entrust Technologies, Inc. ............. 704,900
*124,740 Network Appliance, Inc. ................ 6,969,847
*78,750 New Era of Networks, Inc. .............. 3,460,078
------------
12,336,016
------------
<CAPTION>
NUMBER OF
SHARES VALUE
- --------- ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
COMPUTERS--SOFTWARE &
PERIPHERALS--18.9%
*54,395 Careinsite, Inc. ....................... $ 2,570,164
*36,800 Concentric Network Corp. ............... 1,462,800
*82,750 Informatica Corp. ...................... 2,947,969
*6,655 Marketwatch.Com, Inc. .................. 391,813
*76,025 Mercury Interactive Corp. .............. 2,689,384
*66,800 Metromedia Fiber Network, Inc. ......... 2,400,625
*57,500 Micromuse, Inc. ........................ 2,867,812
*25,005 Northpoint Communications............... 912,682
*63,700 Phone.Com, Inc. ........................ 3,567,200
*34,400 Rational Software Corp. ................ 1,133,050
*17,000 Realnetworks, Inc. ..................... 1,170,875
54,600 Research in Motion Ltd. ................ 1,105,650
*38,600 Rhythms Netconnections, Inc. ........... 2,253,275
*37,425 Silknet Software, Inc. ................. 1,515,712
*132,550 THINK New Ideas, Inc. .................. 2,095,947
*143,570 Usinternetworking, Inc. ................ 6,029,940
*15,850 Verio, Inc. ............................ 1,101,575
*69,402 VERITAS Software Corp. ................. 6,588,852
*64,750 Visual Networks, Inc. .................. 2,072,000
------------
44,877,325
------------
DATA PROCESSING SYSTEMS--2.9%
*72,000 CSG Systems International, Inc. ........ 1,885,500
*56,000 MedQuist, Inc. ......................... 2,450,000
*87,400 Tsi International Software Ltd. ........ 2,479,975
------------
6,815,475
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
36
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- --------- ------------
COMMON STOCKS (CONTINUED)
<C> <S> <C>
EDUCATION--4.1%
*48,050 Career Education Corp. ................. $ 1,624,691
*138,156 DeVry, Inc. ............................ 3,091,240
*99,160 Education Management Corp. ............. 2,057,570
*109,320 ITT Educational Services, Inc. ......... 2,849,152
------------
9,622,653
------------
ELECTRICAL EQUIPMENT--2.0%
*72,430 Gemstar International Group Ltd. ....... 4,726,057
------------
ELECTRONIC EQUIPMENT &
COMPONENTS--13.2%
*49,000 Applied Micro Circuits Corp. ........... 4,030,250
*89,600 DII Group, Inc. ........................ 3,343,200
*19,725 Etec Systems, Inc. ..................... 655,856
*58,600 Hi/FN, Inc. ............................ 4,460,925
*56,500 Jabil Circuit, Inc. .................... 2,549,562
*18,925 Lattice Semiconductor Corp. ............ 1,178,081
*17,575 Phototronics, Inc. ..................... 430,588
*60,000 PLX Technology, Inc. ................... 2,842,500
*20,500 Qlogic Corp. ........................... 2,706,000
*8,475 Rambus, Inc. ........................... 781,289
*65,200 Sawtek, Inc. ........................... 2,991,050
*112,800 Transwitch Corp. ....................... 5,343,900
------------
31,313,201
------------
ELECTRONICS--1.4%
*55,650 PMC - Sierra, Inc. ..................... 3,279,872
------------
ENTERTAINMENT--0.5%
*44,990 Cinar Corp. ............................ 1,102,255
------------
<CAPTION>
NUMBER OF
SHARES VALUE
- --------- ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
FINANCIAL SERVICES--0.6%
36,540 Bank United Corp., Class A.............. $ 1,468,451
------------
FOOD WHOLESALING--2.2%
27,500 Dean Foods Co. ......................... 1,142,969
*82,850 Robert Mondavi Corp. ................... 3,013,669
*25,125 U.S. Foodservice........................ 1,070,953
------------
5,227,591
------------
HUMAN RESOURCES--0.5%
*67,900 Korn/Ferry International................ 1,154,300
------------
INSTRUMENTS--0.3%
17,665 Microchip Technology, Inc. ............. 836,879
------------
INSURANCE--0.3%
20,550 Reinsurance Group of America, Inc. ..... 724,388
------------
INSURANCE--HEALTH, LIFE &
MULTI-LINE--0.5%
50,300 Annuity and Life Re (Holdings) Ltd. .... 1,128,606
------------
INVESTMENT MANAGEMENT--1.9%
40,600 Legg Mason, Inc. ....................... 1,563,100
*42,287 PIMCO Advisors Holdings LP.............. 1,258,038
64,600 Waddell & Reed Financial, Inc. ......... 1,772,463
------------
4,593,601
------------
MANUFACTURING--4.3%
*117,965 Scotts Co. (The), Class A............... 5,618,083
*85,870 Waters Corp. ........................... 4,561,883
------------
10,179,966
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
37
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- --------- ------------
COMMON STOCKS (CONTINUED)
<C> <S> <C>
MEDIA--1.8%
*22,000 Hispanic Broadcasting Corp. ............ $ 1,669,250
*27,525 Radio One, Inc. ........................ 1,279,913
*23,650 Scholastic Corp. ....................... 1,197,281
------------
4,146,444
------------
MEDICAL CARE & PRODUCTS--1.6%
*88,450 Celgene Corp. .......................... 1,553,403
*21,600 Express Scripts, Inc., Class A.......... 1,300,050
*27,550 Patterson Dental Co. ................... 957,363
------------
3,810,816
------------
OIL & GAS--2.2%
*38,050 BJ Services Co. ........................ 1,120,097
*134,425 Global Industries Ltd. ................. 1,722,320
*78,860 National-Oilwell, Inc. ................. 1,104,040
*95,835 R&B Falcon Corp. ....................... 898,453
*31,900 Stolt Comex Seaway, SA (ADR)............ 342,925
------------
5,187,835
------------
OIL FIELD SERVICES &
EQUIPMENT--0.4%
*64,750 Tuboscope Vetco International Corp. .... 886,266
------------
OIL--INTERNATIONAL--0.3%
*63,800 Stolt Comex Seaway SA................... 693,825
------------
PARKING FACILITIES--1.1%
76,710 Central Parking Corp. .................. 2,627,318
------------
<CAPTION>
NUMBER OF
SHARES VALUE
- --------- ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
PHARMACEUTICALS--7.6%
*65,850 Andrix Corp. ........................... $ 5,078,681
*32,100 Coulter Pharmaceutical, Inc. ........... 724,256
*18,000 Covance, Inc. .......................... 430,875
53,200 Jones Pharma, Inc. ..................... 2,094,750
*84,100 MedImmune, Inc. ........................ 5,697,775
*52,850 PathoGenesis Corp. ..................... 749,809
*50,400 Roberts Pharmaceutical Corp. ........... 1,222,200
*24,550 Sepracor, Inc. ......................... 1,994,688
------------
17,993,034
------------
PUBLISHING--0.5%
25,000 Houghton Mifflin Co. ................... 1,176,563
------------
RETAIL--SPECIALTY STORES--2.9%
*85,825 Duane Reade, Inc. ...................... 2,628,391
*95,345 Iron Mountain, Inc. .................... 2,729,251
15,875 Tiffany & Co. .......................... 1,531,938
------------
6,889,580
------------
RETAILING--4.4%
*71,900 American Eagle Outfitters, Inc. ........ 3,271,450
*100,000 BJ's Wholesale Club, Inc. .............. 3,006,250
*95,350 Linens 'N Things, Inc. ................. 4,171,563
------------
10,449,263
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
38
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- --------- ------------
COMMON STOCKS (CONTINUED)
<C> <S> <C>
TELECOMMUNICATIONS--7.0%
*119,800 Antec Corp. ............................ $ 3,841,088
*16,700 Aware, Inc.............................. 770,288
*187,300 Clearnet Communications, Inc., Class
A....................................... 2,610,494
*48,115 Copper MTN Networks..................... 3,716,884
*149,900 Pairgian Technologies, Inc. ............ 1,723,850
*72,400 Voicestream Wireless Corp............... 2,058,875
*72,400 Western Wireless Corp. ................. 1,954,800
------------
16,676,279
------------
TOTAL COMMON STOCKS
(Cost $172,879,977)..................... 229,890,734
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
- ----------
<C> <S> <C>
MONEY MARKET FUND--3.1%
$7,316,877 ACM Institutional Reserves (Prime
Portfolio), 4.9% (a) (Cost
$7,316,877)............................. 7,316,877
------------
TOTAL INVESTMENTS
(Cost $180,196,854) (b)-- 100.1%........ 237,207,611
Other assets less liabilities--
(0.1)%.................................. (110,769)
------------
NET ASSETS--100.0%...................... $237,096,842
------------
------------
</TABLE>
ADR AMERICAN DEPOSITARY RECEIPT.
* NON-INCOME PRODUCING SECURITY.
(a) REPRESENTS ANNUALIZED YIELD AT JUNE 30, 1999.
(b) THE COST STATED ALSO APPROXIMATES THE AGGREGATE COST FOR FEDERAL INCOME TAX
PURPOSES. AT JUNE 30, 1999, NET UNREALIZED APPRECIATION WAS $57,010,757
BASED ON COST FOR FEDERAL INCOME TAX PURPOSES. THIS CONSISTED OF AGGREGATE
GROSS UNREALIZED APPRECIATION OF $67,332,959 AND AGGREGATE GROSS UNREAL-
IZED DEPRECIATION OF $10,322,202.
SEE NOTES TO FINANCIAL STATEMENTS.
39
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at value
(Cost $180,196,854)..................................... $237,207,611
Cash...................................................... 46
Receivables:
Capital stock sold...................................... 364,729
Dividends............................................... 32,083
Interest................................................ 14,867
Deferred organization costs and other assets.............. 24,962
------------
TOTAL ASSETS.......................................... 237,644,298
------------
LIABILITIES:
Payables:
Investments purchased................................... 250,474
Services provided by the Bank of New York and
Administrator......................................... 190,724
Capital stock repurchased............................... 74,540
Accrued expenses and other liabilities.................... 31,718
------------
TOTAL LIABILITIES..................................... 547,456
------------
NET ASSETS:................................................. $237,096,842
------------
------------
SOURCES OF NET ASSETS:
Capital stock @ par....................................... $ 16,035
Capital surplus........................................... 165,660,902
Accumulated net investment loss........................... (712,090)
Accumulated net realized gain on investments.............. 15,121,238
Net unrealized appreciation on investments................ 57,010,757
------------
NET ASSETS.................................................. $237,096,842
------------
------------
INSTITUTIONAL SHARES:
Net assets................................................ $227,293,118
------------
------------
Shares outstanding........................................ 15,370,045
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 14.79
------------
------------
INVESTOR SHARES:
Net assets................................................ $ 9,803,724
------------
------------
Shares outstanding........................................ 665,300
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 14.74
------------
------------
Institutional Shares authorized @ $.001 par value........... 200,000,000
Investor Shares authorized at @ $.001 par value............. 200,000,000
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends................................................. $ 204,653
Interest.................................................. 113,949
-----------
TOTAL INCOME............................................ 318,602
-----------
EXPENSES:
Advisory.................................................. 750,826
Administration............................................ 190,679
12b-1 fee--Investor Shares................................ 10,345
Transfer agent............................................ 42,988
Accounting services....................................... 29,744
Custodian................................................. 21,872
Registration and filings.................................. 15,964
Reports to shareholders................................... 11,090
Directors................................................. 7,812
Organization.............................................. 3,810
Audit..................................................... 3,750
Cash management........................................... 2,931
Insurance................................................. 2,659
Legal..................................................... 1,295
Other..................................................... 2,577
-----------
TOTAL EXPENSES.......................................... 1,098,342
Fees waived by the Bank of New York (Note 3).............. (60,219)
Earnings credit adjustment (Note 3)....................... (316)
-----------
NET EXPENSES............................................ 1,037,807
-----------
NET INVESTMENT LOSS..................................... (719,205)
-----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on:
Investments............................................. 14,648,044
Increase in unrealized appreciation on
Investments during the period........................... 24,614,232
-----------
Net realized and unrealized gain on investments........... 39,262,276
-----------
Net increase in net assets resulting from operations...... $38,543,071
-----------
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
40
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR
JUNE 30, 1999 ENDED
(UNAUDITED) DECEMBER 31, 1998
---------------- -----------------
<S> <C> <C>
OPERATIONS:
Net investment loss..................................................................... $ (719,205) $ (319,037)
Net realized gain on investments........................................................ 14,648,044 3,890,486
Increase in unrealized appreciation on investments during the period.................... 24,614,232 9,835,596
---------------- -----------------
Net increase in net assets resulting from operations.................................. 38,543,071 13,407,045
---------------- -----------------
DISTRIBUTIONS TO SHAREHOLDERS:
Distributions from capital gains: Institutional Shares.................................. -0- (5,305,891)
Investor Shares....................................... -0- (153,674)
---------------- -----------------
-0- (5,459,565)
---------------- -----------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Institutional Shares.................................. 94,124,771 75,070,569
Investor Shares....................................... 58,514,758 34,034,055
Proceeds from shares issued on reinvestment
of distributions: Institutional Shares................................................ -0- 4,771,812
Investor Shares................................................... -0- 153,324
Cost of capital stock repurchased: Institutional Shares................................. (91,203,569) (32,750,019)
Investor Shares...................................... (58,047,066) (28,964,378)
---------------- -----------------
Net increase in net assets resulting from capital stock transactions.................. 3,388,894 52,315,363
---------------- -----------------
INCREASE IN NET ASSETS.............................................................. 41,931,965 60,262,843
NET ASSETS:
Beginning of period..................................................................... 195,164,877 134,902,034
---------------- -----------------
End of period (includes accumulated net investment income (loss) of ($712,090) at June
30, 1999 and $7,115 at December 31, 1998)............................................. $ 237,096,842 $195,164,877
---------------- -----------------
---------------- -----------------
CHANGES IN CAPITAL STOCK OUTSTANDING:
Shares sold: Institutional Shares....................................................... 7,439,940 6,284,220
Investor Shares............................................................ 4,679,539 2,851,784
Shares issued on reinvestment of distributions: Institutional Shares.................... -0- 429,488
Investor Shares......................... -0- 13,800
Shares repurchased: Institutional Shares................................................ (7,188,981) (2,801,386)
Investor Shares..................................................... (4,557,959) (2,419,110)
---------------- -----------------
Net increase.......................................................................... 372,539 4,358,796
Shares outstanding, beginning of period................................................. 15,662,807 11,304,011
---------------- -----------------
Shares outstanding, end of period....................................................... 16,035,346 15,662,807
---------------- -----------------
---------------- -----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
41
<PAGE>
BNY HAMILTON SMALL CAP GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL SHARES
---------------------------------------------------
SIX MONTHS FOR THE PERIOD
ENDED YEAR APRIL 1, 1997*
JUNE 30, ENDED THROUGH
1999 DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1998 1997
------------ ------------- ---------------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period.. $ 12.46 $ 11.93 $ 10.00
------------ ------------- ---------------
INCOME FROM INVESTMENT OPERATIONS
Net investment loss..................... (0.09) (0.02)(a) (0.02)
Net realized and unrealized gain on
investments........................... 2.42 0.91 2.80
------------ ------------- ---------------
Total from investment operations...... 2.33 0.89 2.78
------------ ------------- ---------------
DISTRIBUTIONS
Distributions from capital gains........ -- (0.36) (0.85)
------------ ------------- ---------------
Net asset value at end of period........ $ 14.79 $ 12.46 $ 11.93
------------ ------------- ---------------
------------ ------------- ---------------
TOTAL RETURN:........................... 18.70%** 7.89% 27.80%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $227,293 $188,402 $133,741
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 1.02%*** 0.97% 0.97%***
Expenses, prior to waiver from The
Bank of New York.................... 1.08%*** 1.13% 1.10%***
Net investment loss, net of waiver
from The Bank of New York........... (0.71)%*** (0.19)% (0.26)%***
Portfolio turnover rate................. 55% 84% 68%
<CAPTION>
INVESTOR SHARES
-----------------------------------------------------
SIX MONTHS FOR THE PERIOD
ENDED YEAR MAY 1, 1997*
JUNE 30, ENDED THROUGH
1999 DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1998 1997
------------- ------------- ----------------
<S> <C><C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period.. $12.44 $11.94 $10.03
------ ------ ------
INCOME FROM INVESTMENT OPERATIONS
Net investment loss..................... (0.09) (0.04)(a) (0.02)
Net realized and unrealized gain on
investments........................... 2.39 0.90 2.78
------ ------ ------
Total from investment operations...... 2.30 0.86 2.76
------ ------ ------
DISTRIBUTIONS
Distributions from capital gains........ -- (0.36) (0.85)
------ ------ ------
Net asset value at end of period........ $14.74 $12.44 $11.94
------ ------ ------
------ ------ ------
TOTAL RETURN:........................... 18.49%** 7.55% 27.52%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $9,804 $6,763 $1,162
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 1.38%*** 1.22% 1.22%***
Expenses, prior to waiver from The
Bank of New York.................... 1.48%*** 1.46% 1.40%***
Net investment loss, net of waiver
from The Bank of New York........... (0.93)%*** (0.43)% (0.54)%***
Portfolio turnover rate................. 55% 84% 68%
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS FOR THE RESPECTIVE CLASS OF SHARES.
** NOT ANNUALIZED.
*** ANNUALIZED.
(a) BASED ON AVERAGE SHARES OUTSTANDING.
SEE NOTES TO FINANCIAL STATEMENTS.
42
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES US$ VALUE
- ----------- ------------
<C> <S> <C>
COMMON STOCKS--96.2%
AUSTRALIA--2.1%
18,700 Broken Hill Proprietary Co. Ltd. ....... $ 216,607
40,000 F. H. Faulding & Co. Ltd. .............. 243,580
99,550 Foster's Brewing Group Ltd. ............ 280,569
104,708 James Hardi Industries Ltd. ............ 277,225
13,300 Lend Lease Corp. Ltd. .................. 182,606
28,791 Macquarie Bank Ltd. .................... 388,759
26,700 National Australian Bank Ltd. .......... 441,819
*240,000 Pasminco Ltd. .......................... 264,972
50,500 Publishing & Broadcasting Ltd. ......... 333,257
92,935 Quantas Airways Ltd. ................... 306,954
*182,000 Smorgon Steel Group Ltd. ............... 275,867
*60,350 Telestra Corp. Ltd. .................... 345,810
74,100 WMC Ltd. ............................... 318,314
20,200 Woodside Petroleum Ltd. ................ 136,779
------------
4,013,118
------------
BRAZIL--0.4%
8,000 Telebras (ADR).......................... 721,500
------------
CHINA--0.0%
190,000 Huaneng Power International Inc. ....... 79,586
------------
FINLAND--2.6%
39,000 Nokia Oyj-A Shares...................... 3,418,583
37,850 Sonera Group Oyj........................ 827,493
15,000 Tieto Corp.--B Shares................... 624,936
------------
4,871,012
------------
<CAPTION>
NUMBER OF
SHARES US$ VALUE
- ----------- ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
FRANCE--10.2%
9,600 Alcatel Alsthom......................... $ 1,351,346
18,000 AXA SA.................................. 2,195,937
23,000 Banque Nationale De Paris............... 1,916,469
10,560 Carrefour Supermarche SA................ 1,551,820
6,800 Elf Aquitaine SA........................ 997,876
14,250 France Telecom SA....................... 1,076,428
2,700 L'OREAL................................. 1,825,152
3,530 Legrand SA.............................. 718,595
*10,240 Pinault-Printemps-Redoute SA............ 1,757,179
*10,340 Rexel SA................................ 801,331
9,800 STMicroelectronics NV................... 652,862
*12,100 Total SA, B Shares...................... 1,561,009
35,700 Vivendi................................. 2,891,858
------------
19,297,862
------------
GERMANY--6.9%
*6,500 Allianz AG.............................. 1,816,541
23,600 BASF AG................................. 1,036,774
22,830 Daimlerchrysler AG...................... 1,994,123
29,000 Deutsche Telekom AG..................... 1,218,676
21,300 Douglas Holding AG...................... 962,091
44,500 Dresdner Bank AG........................ 1,730,071
4,225 Fresenius AG............................ 740,693
2,700 SAP AG.................................. 1,073,373
18,000 Siemens AG.............................. 1,388,471
21,000 VEBA AG................................. 1,238,734
------------
13,199,547
------------
GREECE--0.8%
23,000 Intercom SA............................. 1,482,599
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
43
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES US$ VALUE
- ----------- ------------
COMMON STOCKS (CONTINUED)
<C> <S> <C>
HONG KONG--3.0%
76,000 ASM Pacific Technology.................. $ 50,935
*64,000 Cheung Kong Holdings Ltd. .............. 569,153
*39,000 CLP Holdings Ltd. ...................... 189,499
*152,000 First Pacific Co. Ltd. ................. 129,297
62,000 Guocco Group Ltd. ...................... 166,209
*87,000 Hang Lung Development Co. Ltd. ......... 107,644
*32,700 Hang Seng Bank Ltd. .................... 365,609
*36,000 Henderson Land Development Co. Ltd. .... 206,937
*117,000 Hong Kong & China Gas Co. Ltd. ......... 169,644
*26,000 Hong Kong Electronic Holdings Ltd. ..... 83,775
209,600 Hong Kong Telecommunications Ltd. ...... 544,335
10,000 HSBC Holdings PLC....................... 364,742
*51,000 Hutchison Whampoa Ltd. ................. 461,760
69,000 Hysan Development Co. .................. 104,048
*197,000 New World Development Co. Ltd. ......... 590,322
*130,000 New World Infrastructure Ltd. .......... 244,622
*51,000 Sun Hung Kai Properties Ltd. ........... 465,047
44,000 Swire Pacific-Class A................... 217,763
822,000 Tan Ckong International Ltd. ........... 201,291
*3,200,000 Tricom Holding Ltd. .................... 494,916
------------
5,727,548
------------
<CAPTION>
NUMBER OF
SHARES US$ VALUE
- ----------- ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
IRELAND--1.4%
89,300 Allied Irish Banks PLC.................. $ 1,173,963
84,000 CRH PLC................................. 1,487,679
------------
2,661,642
------------
ITALY--4.3%
62,000 Assicurazioni Generali.................. 2,148,293
*200,000 ENI SpA................................. 1,194,184
*91,800 Tecnost SpA............................. 226,258
400,000 Telecom Italia Mobile SpA--RNC.......... 2,388,368
*199,000 Telecom Italia SpA-RNC.................. 1,079,447
255,000 Unicredito Italiano SpA................. 1,120,243
------------
8,156,793
------------
JAPAN--23.4%
*40,000 Canon Inc. ............................. 1,150,033
*26,000 Fanuc Ltd. ............................. 1,396,233
*32,000 Fuji Photo Film......................... 1,210,839
*164,000 Fujitsi Ltd. ........................... 3,299,240
*45,000 Ito-Yokado Co. Ltd. .................... 3,011,401
*70,000 Kao Corp. .............................. 1,966,292
*33,000 Matsushita Communication Industrial Co.
Ltd. ................................... 2,358,311
*62,000 Nippon COMSYS Corp. .................... 1,006,527
*87,000 Nippon Electric Glass Co. Ltd. ......... 1,092,531
*107 Nippon Telegraph & Telephone Co.
Ltd. ................................... 1,246,447
*286 NTT Data Corp. ......................... 2,273,067
290 NTT Mobile Communicaiton Network
Inc. ................................... 3,929,280
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
44
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES US$ VALUE
- ----------- ------------
COMMON STOCKS (CONTINUED)
<C> <S> <C>
*26,000 Ono Pharmaceutical Co. Ltd. ............ $ 902,181
*10,000 Rohm Co. ............................... 1,565,598
*23,000 Secom Co. Ltd. ......................... 2,394,250
*145,000 Sekisui House Ltd. ..................... 1,564,524
*36,000 Seven-Eleven Japan Co. Ltd. ............ 3,527,429
*88,000 Sharp Corp. ............................ 1,039,656
*32,000 Shin-Etsu Chemical Co. Ltd. ............ 1,070,720
*58,000 Takeda Chemical Industries.............. 2,688,202
*11,000 Takefuji Corp. ......................... 1,136,897
*121,000 Terumo Corp. ........................... 2,694,109
*112,000 Yamato Transport Co. Ltd. .............. 1,952,412
------------
44,476,179
------------
MALAYSIA--0.4%
19,200 Malayan Banking Berhad.................. 51,867
*3,000 Rothmans of Pall Mall Berhad............ 20,438
256,000 Sime Darby Berhad....................... 302,104
*20,000 Tanjong PLC............................. 44,787
*102,000 Tenaga Nasional Berhad.................. 211,493
*55,000 The New Straits Times Press (M)......... 112,737
------------
743,426
------------
MEXICO--0.3%
548,000 Controlandora Commercial Mexicana SA.... 575,377
------------
<CAPTION>
NUMBER OF
SHARES US$ VALUE
- ----------- ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
NETHERLANDS--6.4%
22,390 AEGON NV................................ $ 1,624,354
36,000 Akzo Nobel NV........................... 1,514,695
50,000 CMG PLC................................. 1,314,840
5,000 Dortsche Petroleum-Industrie MIJ NV..... 237,960
*10,150 Equant NV............................... 935,764
28,842 Internationale Nederlanden Groep NV..... 1,561,519
54,600 Royal Dutch Petroleum Co. .............. 3,198,185
8,000 Unilever NV............................. 539,136
30,212 Wolters Kluwer-CVA...................... 1,202,623
------------
12,129,076
------------
NEW ZEALAND--0.6%
69,600 Independent Newspapers Ltd. ............ 261,848
168,400 Telecom Corp. of New Zeland............. 722,785
43,000 The Warehouse Group Ltd. ............... 167,470
------------
1,152,103
------------
NORWAY--0.4%
18,300 Tomra Systems ASA....................... 688,066
------------
PHILIPPINES--0.0%
*1,750,000 Pryce Corp. ............................ 71,748
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
45
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES US$ VALUE
- ----------- ------------
COMMON STOCKS (CONTINUED)
<C> <S> <C>
SINGAPORE--1.0%
74,000 City Developments Ltd. ................. $ 473,774
36,000 First Capital Corp. Ltd. ............... 56,035
*293,000 Kim Eng Holdings Ltd. .................. 273,639
180,000 Neptune Orient Lines Ltd. .............. 219,912
7,000 OCBC-Foreign............................ 58,385
30,800 Overseas Union Bank..................... 148,347
*29,000 Overseas-Chinese Banking Corp. Ltd. .... 221,439
185,000 Singapore Technologies Engineering
Ltd. ................................... 209,721
*110,000 Singapore Telecommunications............ 188,664
*90,000 Wing Tai Holdings Ltd. ................. 118,943
------------
1,968,859
------------
SOUTH KOREA--0.6%
34,600 Dongwon Securities...................... 636,700
2,526 Samsung Electronics Co. ................ 277,151
15,094 Shinhan Bank............................ 169,522
------------
1,083,373
------------
SPAIN--3.5%
234,000 Banco Santander......................... 2,437,249
*70,000 Endesa SA............................... 1,492,833
*55,850 Telefonica SA........................... 2,690,269
------------
6,620,351
------------
SWEDEN--2.0%
100,000 Skandia Forsakrings AB.................. 1,870,148
60,000 Telefonaktiebolaget LM Ericson-B
Shares.................................. 1,923,077
------------
3,793,225
------------
<CAPTION>
NUMBER OF
SHARES US$ VALUE
- ----------- ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
SWITZERLAND--7.3%
3,300 Adecco SA............................... $ 1,768,236
2,000 Clariant AG............................. 823,363
11,250 Credit Suisse Group..................... 1,946,642
*375 Nestle SA............................... 675,656
*1,160 Novartis AG............................. 1,693,812
242 Roche Holding AG........................ 2,487,559
*7,900 UBS AG.................................. 2,357,906
*3,650 Zurich Allied AG........................ 2,075,518
------------
13,828,692
------------
THAILAND--0.1%
40,600 ABN Amro Asia Securities Public Co.
Ltd. ................................... 144,233
10,000 Advanced Info Service Public Co.
Ltd. ................................... 109,820
------------
254,053
------------
UNITED KINGDOM--18.5%
100,800 Bank of Scotland........................ 1,317,200
308,051 BP Amoco PLC............................ 5,516,172
175,392 British Aerospace PLC................... 1,146,656
*235,800 British Telecommunications PLC.......... 3,939,912
*62,000 Cable & Wireless Communications PLC..... 598,108
*89,000 Carlton Communications PLC.............. 737,224
*165,000 Compass Group PLC....................... 1,634,655
*43,000 Dixons Group PLC........................ 803,200
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
46
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES US$ VALUE
- ----------- ------------
COMMON STOCKS (CONTINUED)
<C> <S> <C>
*25,400 Energis PLC............................. $ 605,772
128,750 Glaxo Wellcome PLC...................... 3,575,938
37,800 HSBC Holdings PLC....................... 1,340,637
*52,500 Jarvis PLC.............................. 247,025
70,000 Kingfisher PLC.......................... 806,037
151,000 Lloyds TSB Group PLC.................... 2,041,023
*114,194 Misys PLC............................... 976,517
65,000 Pearson PLC............................. 1,314,549
114,000 Sema Group PLC.......................... 1,098,849
*225,850 SmithKline Beecham PLC.................. 2,931,707
78,103 Smiths Industries PLC................... 1,038,460
181,000 Vodafone Airtouch PLC................... 3,577,774
------------
35,247,415
------------
TOTAL COMMON STOCKS
(Cost $160,586,988)..................... 182,843,150
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
- ---------
<C> <S> <C>
CORPORATE BONDS--0.3%
ITALY--0.3%
$443,700 Tecnost International
4.487%+, 6/23/2004
(Cost $459,032)......................... 465,663
------------
</TABLE>
<TABLE>
<CAPTION>
NUMBER OF
SHARES US$ VALUE
- --------- ------------
<C> <S> <C>
WARRANTS--0.0%
GERMANY--0.0%
50 Muenchener Ruecksversich expiring
6/30/2002
(Cost $2,030)........................... $ 1,598
------------
TOTAL INVESTMENTS
(Cost $161,048,050) (a)-- 96.5%......... 183,310,411
Other assets less liabilities-- 3.5%.... 6,745,271
------------
NET ASSETS--100.0%...................... $190,055,682
------------
------------
</TABLE>
ADR AMERICAN DEPOSITARY RECEIPT.
* NON-INCOME PRODUCING SECURITY.
+ FLOATING RATE AS OF JUNE 30, 1999.
(a) THE COST STATED ALSO APPROXIMATES THE AGGREGATE COST FOR FEDERAL INCOME TAX
PURPOSES. AT JUNE 30, 1999, NET UNREALIZED APPRECIATION WAS $22,262,361
BASED ON COST FOR FEDERAL INCOME TAX PURPOSES. THIS CONSISTED OF AGGREGATE
GROSS UNREALIZED APPRECIATION OF $28,291,008 AND AGGREGATE GROSS UNREALIZED
DEPRECIATION OF $6,028,647.
SEE NOTES TO FINANCIAL STATEMENTS.
47
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
INDUSTRY DIVERSIFICATION
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
% OF
TOTAL
US$ VALUE NET ASSETS
------------ ----------
<S> <C> <C>
Aerospace and Defense................... $ 2,365,743 1.2%
Automotive.............................. 2,996,745 1.6
Banking................................. 22,376,816 11.8
Building Materials...................... 5,565,220 2.9
Chemicals--Basic........................ 5,139,572 2.7
Computers............................... 1,401,427 0.7
Computers--Software & Peripherals....... 12,037,113 6.3
Conglomerates........................... 763,864 0.4
Construction............................ 491,647 0.3
Consumer Staples........................ 1,825,152 1.0
Defense................................. 209,721 0.1
Electronic Equipment & Components....... 9,187,811 4.8
Energy.................................. 1,561,009 0.8
Environment Managment................... 688,066 0.4
Financial Services...................... 12,282,232 6.5
Food & Beverages........................ 6,161,855 3.2
Healthcare.............................. 5,625,816 3.0
Holdings Companies--Diversified......... 1,643,301 0.9
Insurance............................... 7,840,330 4.1
Leisure and Recreation Products......... 44,787 0.0
Machinery & Engineering................. 219,912 0.1
Manufacturing........................... 3,914,610 2.1
Media................................... 3,149,143 1.7
Metal--Non-Ferrous...................... 2,314,588 1.2
Oil and Gas............................. 11,284,054 5.9
Pharmaceuticals......................... 7,156,204 3.8
Publishing.............................. 333,257 0.2
Real Estate Development................. 1,950,338 1.0
Retailing............................... 8,393,424 4.4
Steel................................... 275,867 0.2
Telecommunications...................... 37,123,462 19.5
Transportation.......................... 1,952,412 1.0
Utilities............................... 4,865,269 2.6
Utilities--Gas.......................... 169,644 0.1
------------ ----------
Total Value of Investments.............. 183,310,411 96.5
Other Assets, Less Liabilities.......... 6,745,271 3.5
------------ ----------
Net Assets.............................. $190,055,682 100.0%
------------ ----------
------------ ----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
48
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at value (Cost $161,048,050).................. $183,310,411
Cash...................................................... 2,962,291
Receivables:
Investments sold........................................ 9,940,947
Currency Contracts...................................... 5,849,580
Dividends............................................... 510,846
Capital stock sold...................................... 324,357
Deferred organization costs and other assets.............. 16,758
------------
TOTAL ASSETS.......................................... 202,915,190
------------
LIABILITIES:
Due to foreign custodian (Cost $7,906,310)................ 7,906,840
Payables:
Investments purchased................................... 4,612,630
Services provided by The Bank of New York and
Administrator......................................... 129,796
Capital stock repurchased............................... 55,775
Accrued expenses and other liabilities.................... 154,467
------------
TOTAL LIABILITIES..................................... 12,859,508
------------
NET ASSETS:................................................. $190,055,682
------------
------------
SOURCES OF NET ASSETS:
Capital stock @ par....................................... $ 14,341
Capital surplus........................................... 164,544,650
Undistributed net investment income....................... 290,130
Accumulated net realized gain on investments.............. 2,966,692
Net unrealized appreciation on investments................ 22,262,361
Net unrealized depreciation on foreign currency
denominated assets and liabilities...................... (22,492)
------------
NET ASSETS.................................................. $190,055,682
------------
------------
INSTITUTIONAL SHARES:
Net assets................................................ $182,375,561
------------
------------
Shares outstanding........................................ 13,757,718
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 13.26
------------
------------
INVESTOR SHARES:
Net assets................................................ $ 7,680,121
------------
------------
Shares outstanding........................................ 582,941
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 13.17
------------
------------
Institutional Shares authorized @ $.001 par value........... 200,000,000
Investor Shares authorized @ $.001 par value................ 200,000,000
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of
$218,145)............................................... $ 1,522,061
Interest.................................................. 34,049
-----------
TOTAL INCOME............................................ 1,556,110
-----------
EXPENSES:
Advisory.................................................. 792,742
Administration............................................ 186,527
12b-1 fee--Investor Shares................................ 7,361
Custodian................................................. 69,287
Transfer agent............................................ 45,005
Accounting services....................................... 38,667
Registration and filings.................................. 16,377
Reports to shareholders................................... 10,115
Directors................................................. 7,882
Cash management........................................... 3,038
Audit..................................................... 2,479
Organization.............................................. 1,991
Insurance................................................. 1,958
Legal..................................................... 1,647
Other..................................................... 16,878
-----------
TOTAL EXPENSES.......................................... 1,201,954
Fees waived by the Bank of New York....................... (8,267)
Earnings credit adjustment (Note 3)....................... (29)
-----------
NET EXPENSES............................................ 1,193,658
-----------
NET INVESTMENT INCOME................................... 362,452
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCY TRANSACTIONS:
Net realized gain on:
Investments............................................. 12,697,127
Foreign currency transactions........................... 1,319,496
-----------
Net realized gain on investments.......................... 14,016,623
-----------
Decrease in unrealized appreciation on:
Investments............................................. (8,494,105)
Foreign currency denominated assets and liabilities..... (45,248)
-----------
Net unrealized loss on investments during the period...... (8,539,353)
-----------
Net realized and unrealized gain on investments........... 5,477,270
-----------
Net increase in net assets resulting from operations...... $ 5,839,722
-----------
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
49
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR
JUNE 30, 1999 ENDED
(UNAUDITED) DECEMBER 31, 1998
------------- ---------------------
<S> <C> <C>
OPERATIONS:
Net investment income............................................... $ 362,452 $ 768,013
Net realized gain (loss) on investments and foreign currency
transactions...................................................... 14,016,623 (7,140,332)
Increase (decrease) in unrealized appreciation on investments and
foreign currency denominated assets and liabilities during the
period............................................................ (8,539,353) 29,939,347
------------- ---------------------
Net increase in net assets resulting from operations.............. 5,839,722 23,567,028
------------- ---------------------
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income: Institutional Shares.......... -0- (233,491)
Investor Shares............... -0- (6,904)
------------- ---------------------
-0- (240,395)
------------- ---------------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Institutional Shares.............. 83,485,209 99,585,768
Investor Shares................... 36,137,958 2,506,420
Proceeds from shares issued on reinvestment of dividends and
distributions: Institutional Shares............................... -0- 53,831
Investor Shares................................. -0- 6,854
Cost of capital stock repurchased: Institutional Shares............. (83,954,528) (39,696,041)
Investor Shares................... (34,206,475) (395,823)
------------- ---------------------
Increase in net assets resulting from capital stock
transactions.................................................... 1,462,164 62,061,009
------------- ---------------------
INCREASE IN NET ASSETS.......................................... 7,301,886 85,387,642
NET ASSETS:
Beginning of period................................................. 182,753,796 97,366,154
------------- ---------------------
End of period....................................................... $ 190,055,682 $ 182,753,796
------------- ---------------------
------------- ---------------------
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold: Institutional Shares................................... 6,474,971 8,210,790
Investor Shares................................. 2,821,912 212,610
Shares issued on reinvestment of dividends: Institutional Shares.... -0- 4,273
Investor Shares......... -0- 546
Shares repurchased: Institutional Shares............................ (6,467,841) (3,331,804)
Investor Shares................................. (2,658,898) (33,304)
------------- ---------------------
Net increase...................................................... 170,144 5,063,111
Shares outstanding, beginning of period............................. 14,170,515 9,107,404
------------- ---------------------
Shares outstanding, end of period................................... 14,340,659 14,170,515
------------- ---------------------
------------- ---------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
50
<PAGE>
BNY HAMILTON INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL SHARES
---------------------------------------------------
FOR THE
SIX MONTHS PERIOD
ENDED YEAR APRIL 1, 1997*
JUNE 30, ENDED THROUGH
1999 DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1998 1997
------------ ------------- ---------------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period.. $ 12.90 $ 10.69 $ 10.00
------------ ------------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.12 0.03 0.02
Net realized and unrealized gain on
investments and foreign currency
transactions.......................... 0.24 2.20 0.67
------------ ------------- -------
Total from investment operations...... 0.36 2.23 0.69
------------ ------------- -------
DIVIDENDS
Dividends from net investment income.... -0- (0.02) -0-
------------ ------------- -------
Net asset value at end of period........ $ 13.26 $ 12.90 $ 10.69
------------ ------------- -------
------------ ------------- -------
TOTAL RETURN:........................... 2.79%** 20.84% 6.90%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $182,376 $177,363 $ 94,806
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 1.27%*** 1.27% 1.26%***
Expenses, prior to waiver from The
Bank of New York.................... 1.28%*** 1.32% 1.49%***
Net investment income
net of waiver from The Bank of New
York................................ 1.82%*** 0.54% 0.26%***
Portfolio turnover rate................. 49% 75% 36%
<CAPTION>
INVESTOR SHARES
-----------------------------------------------------
FOR THE
SIX MONTHS PERIOD
ENDED YEAR MAY 1, 1997*
JUNE 30, ENDED THROUGH
1999 DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1998 1997
------------- ------------- ----------------
<S> <C><C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period.. $12.84 $10.66 $10.19
------ ------ ------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.09 0.03 0.02
Net realized and unrealized gain on
investments and foreign currency
transactions.......................... 0.24 2.17 0.45
------ ------ ------
Total from investment operations...... 0.33 2.20 0.47
------ ------ ------
DIVIDENDS
Dividends from net investment income.... -0- (0.02) -0-
------ ------ ------
Net asset value at end of period........ $13.17 $12.84 $10.66
------ ------ ------
------ ------ ------
TOTAL RETURN:........................... 2.57%** 20.61% 4.61%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $7,680 $5,391 $2,560
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 1.63%*** 1.52% 1.52%***
Expenses, prior to waiver from The
Bank of New York.................... 1.70%*** 1.65% 1.75%***
Net investment income
net of waiver from The Bank of New
York................................ 1.46%*** 0.32% 0.33%***
Portfolio turnover rate................. 49% 75% 36%
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS FOR THE RESPECTIVE CLASS OF SHARES.
** NOT ANNUALIZED.
*** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
51
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ---------- ------------
<C> <S> <C>
COLLATERALIZED MORTGAGE OBLIGATIONS--41.9%
FEDERAL HOME LOAN MORTGAGE
CORP.--13.9%
$ 275,000 Series 1176-H, 8.00%, 12/15/06.......... $ 290,130
500,000 Series 1338-J, 7.00%, 02/15/07.......... 504,265
70,444 Series 1663-D, 7.00%, 08/15/11.......... 70,470
1,662,000 Series 1407-PK, 7.00%, 08/15/21......... 1,666,288
2,100,000 Series 1494-PJ, 6.85%, 01/15/22......... 2,079,924
375,000 Series 1588-TC, 6.50%, 09/15/23......... 369,278
868,000 Series 1602-H, 6.50%, 10/15/23.......... 833,684
2,332,000 Series 1608-O, 6.50%, 11/15/23.......... 2,218,426
500,000 Series 1621-M, 6.50%, 11/15/23.......... 493,965
313,000 Series 1633-C, 6.50%, 12/15/23.......... 299,842
1,988,000 Series 1669-L, 6.50%, 02/15/24.......... 1,933,608
498,000 Series 1672-N, 7.00%, 02/15/24.......... 498,002
------------
11,257,882
------------
FEDERAL NATIONAL MORTGAGE
ASSOC.--28.0%
3,450,000 Series 94-25, 5.125%, 02/13/04.......... 3,309,043
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ---------- ------------
<C> <S> <C>
COLLATERALIZED MORTGAGE OBLIGATIONS (CONTINUED)
$1,202,218 Series 1994-86PE, 6.00%, 09/25/06....... $ 1,202,825
686,391 Series 1988-15A, 9.00%, 06/25/18........ 724,091
439,000 Series 1992-129J, 4.00%, 07/25/20....... 414,886
1,040,000 Series 1992-214PK, 7.00%, 09/25/20...... 1,045,730
3,475,197 Series G92-15Z, 7.00%, 01/25/22......... 3,469,736
285,000 Series G93-34PH, 6.35%, 02/25/22........ 276,670
800,000 Series 1993-96PJ, 7.00%, 08/25/22....... 804,728
665,818 Series 1992-172M, 7.00%, 09/25/22....... 649,345
1,126,894 Series 1993-141Z, 7.00%, 08/25/23....... 1,113,285
2,764,000 Series 1993-149M, 7.00%, 08/25/23....... 2,733,463
1,263,000 Series 1993-252N, 6.50%, 08/25/23....... 1,232,802
3,009,000 Series 1993-178PK, 6.50%, 09/25/23...... 2,828,039
1,440,000 Series 1993-203B, 6.50%, 10/25/23....... 1,390,536
762,000 Series 1993-203PL, 6.50%, 10/25/23...... 737,997
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
52
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ---------- ------------
COLLATERALIZED MORTGAGE OBLIGATIONS (CONTINUED)
<C> <S> <C>
$ 839,000 Series X225C-UB, 6.50%, 12/25/23........ $ 824,661
------------
22,757,837
------------
TOTAL COLLATERALIZED MORTGAGE
OBLIGATIONS
(Cost $34,304,081)...................... 34,015,719
------------
</TABLE>
<TABLE>
<C> <S> <C>
UNITED STATES GOVERNMENT AGENCIES &
OBLIGATIONS--37.1%
FEDERAL HOME LOAN BANK--0.8%
625,000 9.00%, 03/15/06......................... 705,694
-----------
FEDERAL HOME LOAN MORTGAGE
CORP.--5.1%
4,350,000 5.75%, 04/15/08......................... 4,134,740
-----------
FEDERAL NATIONAL MORTGAGE
ASSOC.--2.7%
750,000 6.41%, 05/22/00......................... 754,822
1,500,000 5.75%, 06/15/05......................... 1,471,923
-----------
2,226,745
-----------
TENNESSEE VALLEY AUTHORITY--7.8%
1,350,000 6.00%, 11/01/00......................... 1,354,789
5,000,000 6.13%, 07/15/03......................... 4,957,995
-----------
6,312,784
-----------
UNITED STATES TREASURY BONDS--1.2%
850,000 7.25%, 05/15/16......................... 933,141
-----------
UNITED STATES TREASURY NOTES--19.5%
1,400,000 6.75%, 04/30/00......................... 1,416,625
2,700,000 5.75%, 08/15/03......................... 2,700,000
3,000,000 5.88%, 11/15/05......................... 2,998,125
3,250,000 6.88%, 05/15/06......................... 3,421,642
PRINCIPAL
AMOUNT VALUE
- ----------- -----------
UNITED STATES GOVERNMENT AGENCIES & OBLIGATIONS
(CONTINUED)
$ 5,075,000 6.63%, 05/15/07......................... $ 5,287,516
-----------
15,823,908
-----------
TOTAL UNITED STATES GOVERNMENT AGENCIES
& OBLIGATIONS
(Cost $31,179,611)...................... 30,137,012
-----------
</TABLE>
<TABLE>
<C> <S> <C>
MORTGAGE-BACKED
SECURITIES--19.1%
FEDERAL HOME LOAN MORTGAGE
CORP.--9.1%
75,455 Pool #218711, 8.00%, 10/01/02........... 77,022
146,113 Pool #251836, 8.50%, 05/01/04........... 150,740
267,998 Pool #182217, 8.00%, 12/01/04........... 273,555
52,457 Pool #502185, 8.50%, 07/01/05........... 54,036
1,940,051 Gold Pool #E49415, 6.50%, 07/01/08...... 1,925,564
87,577 Pool #184275, 8.25%, 09/01/08........... 91,136
15,556 Pool #160062, 9.50%, 10/01/08........... 16,537
19,020 Pool #160065, 9.50%, 11/01/08........... 20,220
19,989 Pool #160066, 9.75%, 11/01/08........... 21,253
195,457 Pool #185743, 8.50%, 12/01/08........... 202,292
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
53
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ---------- -----------
<C> <S> <C>
MORTGAGE-BACKED
SECURITIES (CONTINUED)
$ 264,642 Pool #251974, 8.50%, 04/01/09........... $ 276,960
324,181 Pool #185964, 8.50%, 02/01/10........... 338,582
287,846 Gold Pool #E20201, 7.50%, 10/01/10...... 292,759
1,484,858 Gold Pool #G10439, 6.50%, 01/01/11...... 1,469,008
291,498 Gold Pool #E00417, 7.00%, 02/01/11...... 293,084
206,332 Pool #555045, 8.00%, 05/01/19........... 211,168
517,685 Gold Pool #A01217, 8.50%, 04/01/20...... 543,766
1,085,545 Gold Pool #446431, 8.50%, 10/01/26...... 1,137,678
-----------
7,395,360
-----------
FEDERAL NATIONAL MORTGAGE
ASSOC.--2.7%
36,843 Pool #34510, 7.25%, 08/01/01............ 37,253
66,712 Pool #168430, 7.00%, 07/01/03........... 66,785
556,560 Pool #195152, 7.00%, 01/01/08........... 559,923
289,612 Pool #81860, 8.00%, 04/01/09............ 297,954
361,193 Pool #278437, 7.50%, 05/01/09........... 367,196
184,137 Pool #6222, 9.00%, 04/01/16............. 194,556
383,500 Pool #124118, 9.00%, 03/01/22........... 408,043
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ---------- -----------
<C> <S> <C>
MORTGAGE-BACKED
SECURITIES (CONTINUED)
$ 272,037 Pool #320514, 6.50%, 09/01/25........... $ 264,522
-----------
2,196,232
-----------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION--7.3%
846,526 Pool #464704, 8.00%,
01/00/00................................ 870,259
37,414 Pool #6400, 8.00%,
06/15/05................................ 38,458
31,257 Pool #7774, 8.00%,
09/15/05................................ 32,129
43,375 Pool #7038, 8.00%,
10/15/05................................ 44,585
51,425 Pool #11310, 8.00%,
11/15/05................................ 52,860
8,425 Pool #9839, 8.00%,
07/15/06................................ 8,660
31,828 Pool #10459, 8.00%,
08/15/06................................ 32,716
72,485 Pool #10419, 8.00%,
09/15/06................................ 74,508
38,413 Pool #12590, 8.00%,
09/15/06................................ 39,485
78,399 Pool #14295, 8.00%,
01/15/07................................ 80,587
63,792 Pool #204365, 9.00%,
03/15/17................................ 67,999
268,055 Pool #247223, 9.00%,
04/15/18................................ 285,589
37,155 Pool #177793, 9.50%,
05/15/19................................ 40,063
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
54
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ---------- -----------
MORTGAGE-BACKED
SECURITIES (CONTINUED)
<C> <S> <C>
$ 9,778 Pool #256032, 8.50%,
10/15/19................................ $ 10,282
6,727 Pool #284645, 8.50%,
02/15/20................................ 7,066
35,684 Pool #290778, 9.50%,
05/15/20................................ 38,474
23,661 Pool #319650, 7.00%,
11/15/22................................ 23,459
49,185 Pool #350532, 6.50%,
06/15/23................................ 47,767
1,466,460 Pool #351405, 6.50%,
01/15/24................................ 1,423,366
148,611 Pool #359470, 7.00%,
01/15/24................................ 147,082
245,727 Pool #376445, 6.50%,
04/15/24................................ 238,506
125,802 Pool #386348, 7.50%,
06/15/24................................ 127,451
1,320,077 Pool #780035, 6.50%,
07/15/24................................ 1,281,285
232,396 Pool #407323, 8.25%,
04/15/25................................ 242,285
672,915 Pool #464820, 7.00%,
09/15/28................................ 665,110
-----------
5,920,031
-----------
TOTAL MORTGAGE-BACKED SECURITIES
(Cost $15,694,318)...................... 15,511,623
-----------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- -------- MONEY MARKET FUND--1.2% -----------
<C> <S> <C>
$983,891 ACM Institutional Reserves (Government
Portfolio), 4.81% (a) (Cost $983,891)... $ 983,891
-----------
TOTAL INVESTMENTS
(Cost $82,161,901) (b)--99.3%........... 80,648,245
Other assets less
liabilities--0.7%....................... 589,351
-----------
NET ASSETS--100.0%...................... $81,237,596
-----------
-----------
</TABLE>
(a) REPRESENTS ANNUALIZED YIELD AT JUNE 30, 1999.
(b) THE COST STATED ALSO APPROXIMATES THE AGGREGATE COST FOR FEDERAL INCOME TAX
PURPOSES. AT JUNE 30, 1999, NET REALIZED DEPRECIATION WAS $1,513,656 BASED
ON COST FOR FEDERAL INCOME TAX PURPOSES. THIS CONSISTED OF AGGREGATE GROSS
UNREALIZED APPRECIATION OF $173,340 AND AGGREAGATE GROSS UNREALIZED
DEPRECIATION OF $1,686,996.
SEE NOTES TO FINANCIAL STATEMENTS.
55
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investment at value
(Cost $82,161,901)...................................... $80,648,245
Receivables:
Interest................................................ 764,296
Capital stock sold...................................... 72,495
Investments sold........................................ 65,944
Other assets.............................................. 75,635
-----------
TOTAL ASSETS.......................................... 81,626,615
-----------
LIABILITIES:
Payables:
Services provided by the Bank of New York and
Administrator......................................... 139,822
Dividends............................................... 129,381
Capital stock repurchased............................... 108,630
Accrued expenses and other liabilities.................... 11,186
-----------
TOTAL LIABILITIES..................................... 389,019
-----------
NET ASSETS:................................................. $81,237,596
-----------
-----------
SOURCES OF NET ASSETS:
Capital stock @ par....................................... $ 8,410
Capital surplus........................................... 85,002,222
Accumulated net realized loss on investments.............. (2,259,380)
Net unrealized depreciation on investments................ (1,513,656)
-----------
$81,237,596
-----------
-----------
INSTITUTIONAL SHARES:
Net assets................................................ $69,201,229
-----------
-----------
Shares outstanding........................................ 7,163,612
-----------
-----------
Net asset value, offering price and repurchase price per
share................................................... $ 9.66
-----------
-----------
INVESTOR SHARES:
Net assets................................................ $12,036,367
-----------
-----------
Shares outstanding........................................ 1,246,536
-----------
-----------
Net asset value, offering price and repurchase price per
share................................................... $ 9.66
-----------
-----------
Institutional Shares authorized @ $.001 par value........... 200,000,000
Investor Shares authorized @ $.001 par value................ 200,000,000
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest.................................................. $2,640,243
----------
EXPENSES:
Advisory.................................................. 202,118
Administration............................................ 80,847
12b-1 fee--Investor Shares................................ 15,368
Accounting services....................................... 29,747
Custodian................................................. 19,269
Transfer agent............................................ 16,944
Directors................................................. 7,812
Registration and filings.................................. 6,430
Insurance................................................. 3,228
Reports to shareholders................................... 3,043
Audit..................................................... 1,074
Legal..................................................... 706
Cash management........................................... 248
Other..................................................... 5,443
----------
TOTAL EXPENSES.......................................... 392,277
Fees waived by The Bank of New York (Note 3).............. (34,931)
Earnings credit adjustment (Note 3)....................... (257)
----------
NET EXPENSES............................................ 357,089
----------
NET INVESTMENT INCOME................................... 2,283,154
----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investments.......................... 152,331
Decrease in unrealized appreciation on investments during
the period.............................................. (3,345,096)
----------
Net realized and unrealized loss on investments........... (3,192,765)
----------
Net decrease in net assets resulting from operations...... $ (909,611)
----------
----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
56
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR
SIX MONTHS ENDED ENDED
JUNE 30, 1999 DECEMBER 31,
(UNAUDITED) 1998
----------------- ----------------
<S> <C> <C>
OPERATIONS:
Net investment income............................................... $ 2,283,154 $ 4,212,416
Net realized gain on investments.................................... 152,331 390,562
Increase (decrease) in unrealized appreciation on investments during
the period........................................................ (3,345,096) 848,611
----------------- ----------------
Net increase (decrease) in net assets resulting from operations... (909,611) 5,451,589
----------------- ----------------
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income: Institutional Shares.......... (1,949,405) (3,582,992)
Investor Shares............... (333,749) (629,424)
----------------- ----------------
(2,283,154) (4,212,416)
----------------- ----------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Institutional Shares.............. 12,495,817 18,433,862
Investor Shares..................... 848,717 3,922,671
Proceeds from shares issued on reinvestment of dividends:
Institutional Shares.............. 1,213,059 2,226,503
Investor Shares................... 259,413 462,394
Cost of capital stock repurchased: Institutional Shares............. (6,740,667) (20,886,557)
Investor Shares..................... (1,114,834) (2,515,264)
----------------- ----------------
Net increase in net assets resulting from capital stock
transactions.................................................... 6,961,505 1,643,609
----------------- ----------------
INCREASE IN NET ASSETS.......................................... 3,768,740 2,882,782
NET ASSETS:
Beginning of period................................................. 77,468,856 74,586,074
----------------- ----------------
End of period....................................................... $ 81,237,596 $ 77,468,856
----------------- ----------------
----------------- ----------------
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold: Institutional Shares................................... 1,257,633 1,849,294
Investor Shares......................................... 85,799 393,783
Shares issued on reinvestment of dividends: Institutional Shares.... 122,785 223,193
Investor Shares............. 26,266 46,361
Shares repurchased: Institutional Shares............................ (683,326) (2,099,046)
Investor Shares................................... (113,195) (251,939)
----------------- ----------------
Net increase...................................................... 695,962 161,646
Shares outstanding, beginning of period............................. 7,714,186 7,552,540
----------------- ----------------
Shares outstanding, end of period................................... 8,410,148 7,714,186
----------------- ----------------
----------------- ----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
57
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL SHARES
--------------------------------------------------------
SIX MONTHS YEAR FOR THE PERIOD
ENDED ENDED APRIL 1, 1997*
JUNE 30, 1999 DECEMBER 31, THROUGH
(UNAUDITED) 1998 DECEMBER 31, 1997
-------------- ------------------ ------------------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period................................ $ 10.04 $ 9.88 $ 9.53
------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.28 0.56 0.42
Net realized and unrealized gain (loss)
on investments........................ (0.38) 0.16 0.35
------- ------- -------
Total from investment operations...... (0.10) 0.72 0.77
------- ------- -------
DIVIDENDS
Dividends from net investment income.... (0.28) (0.56) (0.42)
------- ------- -------
Net asset value at end of period........ $ 9.66 $ 10.04 $ 9.88
------- ------- -------
------- ------- -------
TOTAL RETURN:........................... (1.04)%** 7.49% 8.27%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $69,201 $64,944 $64,128
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 0.85%*** 0.90% 0.90%***
Expenses, prior to waiver from The
Bank of New York.................... 0.92%*** 0.96% 0.99%***
Net investment income, net of waiver
from The Bank of New York........... 5.69%*** 5.63% 5.79%***
Portfolio turnover rate................. 13% 61% 41%
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
** NOT ANNUALIZED.
*** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
58
<PAGE>
BNY HAMILTON INTERMEDIATE GOVERNMENT FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INVESTOR SHARES
-------------------------------------------------------------------------
SIX
MONTHS
ENDED
JUNE 30, YEAR ENDED DECEMBER 31,
1999 -------------------------------------------------------------
(UNAUDITED) 1998 1997 1996 1995 1994
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period.. $ 10.04 $ 9.87 $ 9.70 $ 9.94 $ 9.10 $ 10.12
--------- --------- --------- --------- --------- ---------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.27 0.54 0.54 0.54 0.53 0.50
Net realized and unrealized gain (loss)
on investments........................ (0.38) 0.17 0.17 (0.24) 0.84 (1.02)
--------- --------- --------- --------- --------- ---------
Total from investment operations...... (0.11) 0.71 0.71 0.30 1.37 (0.52)
--------- --------- --------- --------- --------- ---------
DIVIDENDS
Dividends from net investment income.... (0.27) (0.54) (0.54) (0.54) (0.53) (0.50)
--------- --------- --------- --------- --------- ---------
Net asset value at end of period........ $ 9.66 $ 10.04 $ 9.87 $ 9.70 $ 9.94 $ 9.10
--------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- ---------
TOTAL RETURN:+.......................... (1.16)%* 7.33% 7.54% 3.16% 15.40% (5.17)%
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $ 12,036 $ 12,525 $ 10,458 $ 64,117 $ 60,659 $ 59,328
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 1.09%** 1.15% 1.08% 1.02% 1.06% 1.07%
Expenses, prior to waiver from The
Bank of New York.................... 1.23%** 1.26% 1.11% 1.02% 1.06% 1.10%
Net investment income, net of waiver
from The Bank of New York........... 5.43%** 5.38% 5.57% 5.54% 5.52% 5.30%
Portfolio turnover rate................. 13% 61% 41% 57% 48% 49%
</TABLE>
+ TOTAL RETURN DOES NOT CONSIDER THE EFFECT OF THE SALES LOAD FOR THOSE
PERIODS IN WHICH THE SALES LOAD WAS IN EFFECT.
* NOT ANNUALIZED.
** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
59
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ --------------
<C> <S> <C>
CORPORATE BONDS--56.2%
AEROSPACE AND DEFENSE--1.4%
$ 5,500,000 Raytheon Co. 6.30%, 03/15/05............ $ 5,376,607
--------------
BANKING--1.9%
6,400,000 Interamerican Development Bank 8.50%,
03/15/11................................ 7,423,546
--------------
BEVERAGES--BREWERS--1.1%
5,000,000 Anheuser-Busch Companies, Inc. 5.75%,
01/15/11................................ 4,547,565
--------------
CABLE TV SYSTEMS--0.5%
3,500,000 Charter Communications Holdings LLC
9.92%, 04/01/11 (a)(b).................. 2,187,500
--------------
COMPUTERS--MICRO--0.7%
3,000,000 IBM Corp. 5.625%, 04/12/04.............. 2,901,471
--------------
CONGLOMERATES--2.2%
9,075,000 Tenneco, Inc. 6.70%, 12/15/05........... 8,772,213
--------------
ENTERTAINMENT--6.6%
3,000,000 Carmike Cinemas, Inc. 9.375%, 02/01/09
(a)..................................... 2,917,500
4,500,000 PRIMEDIA, Inc., Series B, 8.50%,
02/01/06................................ 4,511,250
5,500,000 Time Warner, Inc. 7.75%, 06/15/05....... 5,664,637
7,250,000 Time Warner, Inc. PATS 6.10%, 12/30/01
(a)..................................... 7,181,045
5,700,000 Viacom, Inc. 7.75%, 06/01/05............ 5,863,670
--------------
26,138,102
--------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ --------------
<C> <S> <C>
CORPORATE BONDS (CONTINUED)
FINANCIAL SERVICES--22.9%
$ 7,850,000 Aetna Services, Inc. 6.97%, 08/15/36.... $ 7,951,846
3,200,000 Ameritech Capital Funding Corp. 6.30%,
10/15/04................................ 3,174,336
5,000,000 Block Financial Corp. 6.75%, 11/01/04... 5,002,335
4,750,000 Ford Motor Credit Corp. 7.00%,
09/25/01................................ 4,821,677
3,750,000 General Electric Capital Corp. 7.875%,
12/01/06................................ 3,990,157
12,970,000 General Motors Acceptance Corp. 6.15%,
04/05/07................................ 12,429,864
10,000,000 Goldman Sachs Group, L.P. 6.75%,
02/15/06 (a)............................ 9,859,670
6,800,000 Lehman Brothers Holdings, Inc. 7.375%,
05/15/04................................ 6,830,933
8,665,000 Lehman Brothers Holdings, Inc. 7.375%,
05/15/07................................ 8,769,136
7,089,000 Merrill Lynch & Co. 6.55%, 08/01/04..... 7,073,135
4,000,000 Merrill Lynch & Co. 6.00%, 07/15/05..... 3,866,688
4,775,000 Morgan Stanley Dean Witter & Co. 6.70%,
05/01/01................................ 4,800,026
4,850,000 Salomon Smith Barney 6.25%, 01/15/05.... 4,722,974
950,000 Salomon, Inc. 7.00%, 06/15/03........... 960,858
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
60
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ --------------
CORPORATE BONDS (CONTINUED)
<C> <S> <C>
$ 500,000 Salomon, Inc. 6.875%, 12/15/03.......... $ 503,441
3,000,000 Sears Roebuck Acceptance Corp. 6.25%,
05/01/09................................ 2,809,080
3,500,000 Sprint Spectrum L.P. 12.50%, 08/15/06
(c)..................................... 3,185,000
--------------
90,751,156
--------------
FOOD PROCESSING--3.2%
5,000,000 Nabisco, Inc. 6.125%, 02/01/33.......... 4,843,475
8,075,000 Nabisco, Inc. 6.85%, 06/15/05........... 7,865,228
--------------
12,708,703
--------------
HOTELS AND GAMING--1.1%
4,500,000 Hilton Hotels Corp. 7.375%, 06/01/02.... 4,495,887
--------------
INDUSTRIAL & COMMERCIAL
SERVICES--0.8%
3,000,000 WMX Technologies, Inc. 7.70%,
10/01/02................................ 3,096,513
--------------
MEDIA--1.2%
1,750,000 Chancellor Media Corp. 9.00%,
10/01/08................................ 1,789,375
3,000,000 USA Networks, Inc. 6.75%, 11/15/05...... 2,926,965
--------------
4,716,340
--------------
OFFICE EQUIPMENT--2.2%
9,000,000 Xerox Capital Europe PLC 5.875%,
05/15/04................................ 8,763,579
--------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ --------------
<C> <S> <C>
CORPORATE BONDS (CONTINUED)
PUBLISHING--1.0%
$ 4,250,000 TV Guide, Inc. 8.125%, 03/01/09 (a)..... $ 4,042,813
--------------
RESTAURANTS--2.0%
8,000,000 Tricon Global Restaurants, Inc. 7.45%,
05/15/05................................ 7,962,296
--------------
RETAIL--DEPARTMENT STORES--1.3%
5,230,000 Sears Roebuck Co., Series 3, 6.92%,
06/17/04................................ 5,232,563
--------------
TELECOMMUNICATIONS--3.9%
3,500,000 Comcast Cellular Holdings 9.50%,
05/01/07................................ 3,915,625
5,000,000 GTE Corp. 7.51%, 04/01/09............... 5,181,295
5,000,000 Tele-Communications, Inc. 6.58%,
02/15/05................................ 5,376,655
1,000,000 US West Communications 6.625%,
09/15/05................................ 990,467
--------------
15,464,042
--------------
TELECOMMUNICATIONS--TELEPHONE COMPANIES--1.4%
5,630,000 MCI Worldcom, Inc. 6.40%, 08/15/05...... 5,524,708
--------------
UTILITIES--ELECTRIC--0.8%
3,000,000 Niagara Mohawk Power Corp. 7.125%,
07/01/01................................ 3,016,053
--------------
TOTAL CORPORATE BONDS
(Cost $226,405,905)..................... 223,121,657
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
61
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- ------------
UNITED STATES GOVERNMENT AGENCIES & OBLIGATIONS--29.2%
<C> <S> <C>
FEDERAL HOME LOAN MORTGAGE
CORP.--6.8%
$ 8,055,000 5.50%, 05/15/02......................... $ 7,959,733
2,700,000 7.93%, 01/20/05......................... 2,898,771
15,000,000 5.75%, 04/15/08......................... 14,257,725
1,000,000 6.00%, 02/15/09......................... 933,410
155,715 10.00%, 04/01/09........................ 166,742
992,790 6.00%, 03/15/23......................... 933,798
------------
27,150,179
------------
FEDERAL NATIONAL MORTGAGE
ASSOC.--5.1%
2,440,000 0.00%, 08/15/01......................... 2,159,410
7,500,000 5.75%, 06/15/05......................... 7,359,615
1,000,000 6.06%, 02/03/06......................... 963,784
10,000,000 6.50%, 04/29/09......................... 9,649,960
------------
20,132,769
------------
TENNESSEE VALLEY AUTHORITY--0.1%
275,000 6.00%, 11/01/00......................... 275,975
------------
UNITED STATES TREASURY BONDS--4.6%
17,900,000 6.25%, 02/15/07......................... 18,241,228
------------
UNITED STATES TREASURY NOTES--12.6%
5,000,000 6.25%, 02/28/02......................... 5,076,565
15,000,000 7.00%, 07/15/06......................... 15,890,625
28,175,000 6.50%, 10/15/06......................... 29,073,078
------------
50,040,268
------------
TOTAL UNITED STATES GOVERNMENT AGENCIES
& OBLIGATIONS
(Cost $118,466,147)..................... 115,840,419
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- ------------
COLLATERALIZED MORTGAGE OBLIGATIONS--8.1%
<C> <S> <C>
FEDERAL HOME LOAN MORTGAGE
CORP.--1.1%
$ 849,933 Series 1531E, 6.00%, 01/15/06........... $ 849,984
3,385,082 Series 1607ZB, 5.50%, 12/15/10.......... 3,376,775
------------
4,226,759
------------
FEDERAL NATIONAL MORTGAGE
ASSOC.--6.2%
619,952 Series 1993-212C, 6.00%, 11/25/00....... 618,277
3,309,609 Series 1993-1996, 5.80%, 10/25/23....... 3,231,451
16,166,000 Series 94-25, 5.125%, 02/13/04.......... 15,505,506
5,300,000 Series 1993-96PJ, 7.00%, 08/25/22....... 5,331,323
------------
24,686,557
------------
FIXED RATE SECURITIES--0.8%
3,241,869 Kidder Peabody Mortgage Assets Trust,
Series 22, Class D, 9.95%, 02/01/19..... 3,264,009
------------
TOTAL COLLATERALIZED MORTGAGE
OBLIGATIONS
(Cost $31,975,276)...................... 32,177,325
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
62
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- MORTGAGE-BACKED ------------
SECURITIES--4.5%
<C> <S> <C>
FEDERAL HOME LOAN MORTGAGE
CORP.--2.7%
$ 83,611 Pool #180686, 6.00%, 08/01/03........... $ 82,955
813,305 Pool #180006, 9.25%, 08/01/11........... 867,648
10,000,000 Gold Pool #C00785, 6.50%, 06/01/29...... 9,691,071
------------
10,641,674
------------
FEDERAL NATIONAL MORTGAGE
ASSOC.--0.1%
507,127 Pool #219238, 8.50%, 02/01/09........... 528,876
------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION--1.7%
111,778 Pool #13416, 8.00%, 09/15/06............ 114,896
43,561 Pool #13688, 8.00%, 11/15/06............ 44,777
87,798 Pool #12766, 8.00%, 12/15/06............ 90,248
80,650 Pool #16080, 7.50%, 04/15/07............ 81,550
835,271 Pool #21598, 8.00%, 02/15/08............ 858,577
162,505 Pool #27246, 9.00%, 12/15/08............ 172,473
64,888 Pool #31570, 9.50%, 06/15/09............ 69,905
54,892 Pool #34366, 9.50%, 09/15/09............ 59,135
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- ------------
<C> <S> <C>
MORTGAGE-BACKED
SECURITIES (CONTINUED)
$ 45,123 Pool #33765, 9.50%, 10/15/09............ $ 48,612
79,303 Pool #34704, 9.50%, 10/15/09............ 85,395
454,657 Pool #171774, 9.00%, 09/15/16........... 482,545
206,292 Pool #199885, 9.50%, 11/15/17........... 222,239
110,480 Pool #251646, 9.50%, 04/15/18........... 119,021
45,535 Pool #290313, 9.50%, 05/15/20........... 49,056
1,030,475 Pool #319650, 7.00%, 11/15/22........... 1,021,670
1,167,914 Pool #349306, 8.00%, 02/15/23........... 1,201,880
399,248 Pool #376445, 6.50%, 04/15/24........... 387,516
1,127,143 Pool #362262, 7.50%, 04/15/24........... 1,139,723
522,954 Pool #384069, 7.50%, 04/15/24........... 528,791
------------
6,778,009
------------
TOTAL MORTGAGE-BACKED SECURITIES
(Cost $17,736,293)...................... 17,948,559
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
63
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- ASSET-BACKED SECURITIES--0.6% ------------
<C> <S> <C>
ASSET BACKED SECURITIES--CREDIT CARDS--0.6%
$ 2,725,000 Discover Card Master Trust I, Series
1996-3, Class A, 6.05%, 08/18/08 (Cost
$2,612,392)............................. $ 2,651,207
------------
</TABLE>
<TABLE>
<C> <S> <C>
MONEY MARKET FUND--0.1%
293,630 ACM Institutional Reserves (Prime
Portfolio), 4.90% (d) (Cost $293,630)... 293,630
------------
</TABLE>
<TABLE>
<C> <S> <C>
TOTAL INVESTMENTS
(Cost $397,489,643) (e)-- 98.7%......... 392,032,797
Other assets less liabilities--1.3%..... 5,066,817
------------
NET ASSETS--100.0%...................... $397,099,614
------------
------------
</TABLE>
PATS PASS-THRU ASSET TRUST SECURITY.
(a) ILLIQUID SECURITY, EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE
SECURITIES ACT OF 1933.
(b) INTEREST RATE SCHEDULED TO INCREASE TO 9.92% ON APRIL 1, 2004.
(c) INTEREST RATE SCHEDULED TO INCREASE TO 12.5% ON AUGUST 1, 2001.
(d) REPRESENTS ANNUALIZED YIELD AT JUNE 30, 1999.
(e) THE COST STATED ALSO APPROXIMATES THE AGGREGATE COST FOR FEDERAL INCOME TAX
PURPOSES. AT JUNE 30, 1999, NET UNREALIZED DEPRECIATION WAS $5,456,846
BASED ON COST FOR FEDERAL INCOME TAX PURPOSES. THIS CONSISTED OF AGGREGATE
GROSS UNREALIZED APPRECIATION OF $2,272,169 AND AGGREGATE GROSS UNREALIZED
DEPRECIATION OF $7,729,015.
SEE NOTES TO FINANCIAL STATEMENTS.
64
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investment at value
(Cost $397,489,643)..................................... $392,032,797
Receivables:
Interest................................................ 6,161,305
Investments sold........................................ 3,449,234
Capital stock sold...................................... 65,196
Deferred organization costs and other assets.............. 63,194
------------
TOTAL ASSETS.......................................... 401,771,726
------------
LIABILITIES:
Payables:
Investments purchased................................... 3,004,623
Capital stock repurchased............................... 685,577
Dividends............................................... 643,759
Services provided by the Bank of New York and
Administrator......................................... 248,665
Accrued expenses and other liabilities.................... 89,488
------------
TOTAL LIABILITIES..................................... 4,672,112
------------
NET ASSETS:................................................. $397,099,614
------------
------------
SOURCES OF NET ASSETS:
Capital stock @ par....................................... $ 39,238
Capital surplus........................................... 401,567,972
Undistributed net investment income....................... 6,712
Accumulated net realized gain on investments.............. 942,538
Net unrealized depreciation on investments................ (5,456,846)
------------
$397,099,614
------------
------------
INSTITUTIONAL SHARES:
Net assets................................................ $392,859,884
------------
------------
Shares outstanding........................................ 38,819,444
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 10.12
------------
------------
INVESTOR SHARES:
Net assets................................................ $ 4,239,730
------------
------------
Shares outstanding........................................ 418,739
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 10.12
------------
------------
Institutional Shares authorized @ $.001 par value........... 200,000,000
Investor Shares authorized @ $.001 par value................ 200,000,000
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest.................................................. $12,992,984
-----------
EXPENSES:
Advisory.................................................. 990,247
Administration............................................ 396,099
12b-1 fee--Investor Shares................................ 5,207
Transfer agent............................................ 38,661
Accounting services....................................... 29,744
Registration and filings.................................. 26,184
Custodian................................................. 24,749
Reports to shareholders................................... 19,227
Organization.............................................. 10,292
Audit..................................................... 10,102
Directors................................................. 7,812
Legal..................................................... 6,445
Cash management........................................... 4,098
Insurance................................................. 3,228
Other..................................................... 9,606
-----------
TOTAL EXPENSES.......................................... 1,581,701
Fees waived by the Bank of New York (Note 3).............. (638)
Earnings credit adjustment (Note 3)....................... (882)
-----------
NET EXPENSES............................................ 1,580,181
-----------
NET INVESTMENT INCOME................................... 11,412,803
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investments.......................... 281,112
Decrease in unrealized appreciation on investments during
the period.............................................. (19,097,276)
-----------
Net realized and unrealized loss on investments........... (18,816,164)
-----------
Net decrease in net assets resulting from operations...... $(7,403,361)
-----------
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
65
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR
JUNE 30, 1999 ENDED
(UNAUDITED) DECEMBER 31, 1998
------------------ -------------------
<S> <C> <C>
OPERATIONS:
Net investment income............................................... $ 11,412,803 $ 21,685,735
Net realized gain on investments.................................... 281,112 3,931,265
Increase (decrease) in unrealized appreciation on investments during
the period........................................................ (19,097,276) 5,372,256
------------------ -------------------
Net increase (decrease) in net assets resulting from operations... (7,403,361) 30,989,256
------------------ -------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income: Institutional Shares.......... (11,298,670) (21,443,657)
Investor Shares.................. (114,133) (199,801)
Distributions from capital gains: Institutional Shares.............. -0- (3,622,442)
Investor Shares.................... -0- (35,655)
------------------ -------------------
(11,412,803) (25,301,555)
------------------ -------------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Institutional Shares.............. 89,656,593 91,886,282
Investor Shares..................... 830,064 4,460,994
Proceeds from shares issued on reinvestment
of dividends and distributions: Institutional Shares.............. 1,183,399 5,687,853
Investor Shares...................... 112,724 229,199
Cost of capital stock repurchased: Institutional Shares............. (71,883,086) (61,019,124)
Investor Shares..................... (487,308) (2,650,772)
------------------ -------------------
Net increase in net assets resulting from capital stock
transactions.................................................... 19,412,386 38,594,432
------------------ -------------------
INCREASE IN NET ASSETS.......................................... 596,222 44,282,133
NET ASSETS:
Beginning of period................................................. 396,503,392 352,221,259
------------------ -------------------
End of period (includes undistributed net investment income of
$6,712
at June 30, 1999 and December 31, 1998)........................... $397,099,614 $ 396,503,392
------------------ -------------------
------------------ -------------------
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold: Institutional Shares................................... 8,599,726 8,671,169
Investor Shares....................................... 79,776 423,701
Shares issued on reinvestment of dividends: Institutional Shares.... 113,963 537,168
Investor Shares............. 10,856 21,682
Shares repurchased: Institutional Shares............................ (6,895,638) (5,746,886)
Investor Shares................................... (47,030) (251,187)
------------------ -------------------
Net increase...................................................... 1,861,653 3,655,647
Shares outstanding, beginning of period............................. 37,376,530 33,720,883
------------------ -------------------
Shares outstanding, end of period................................... 39,238,183 37,376,530
------------------ -------------------
------------------ -------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
66
<PAGE>
BNY HAMILTON INTERMEDIATE INVESTMENT GRADE FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL SHARES
---------------------------------------------------
SIX MONTHS FOR THE PERIOD
ENDED YEAR APRIL 1, 1997*
JUNE 30, ENDED THROUGH
1999 DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1998 1997
------------ ------------- ---------------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period................................ $ 10.61 $ 10.45 $ 10.00
------------ ------------- ---------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.30 0.61 0.47
Net realized and unrealized gain (loss)
on investments........................ (0.49) 0.26 0.45
------------ ------------- ---------------
Total from investment operations...... (0.19) 0.87 0.92
------------ ------------- ---------------
DIVIDENDS AND DISTRIBUTION
Dividends from net investment
income................................ (0.30) (0.61) (0.47)
Distribution from capital gains......... -- (0.10) --
------------ ------------- ---------------
Total dividends and distribution...... (0.30) (0.71) (0.47)
------------ ------------- ---------------
Net asset value at end of period........ $ 10.12 $ 10.61 $ 10.45
------------ ------------- ---------------
------------ ------------- ---------------
TOTAL RETURN:........................... (1.85)%** 8.56% 9.34%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $392,860 $392,522 $350,330
Ratio to average net assets of:
Expenses, net of waiver from
The Bank of New York................ 0.80%*** 0.81% 0.80%***
Expenses, prior to waiver from The
Bank of New York.................... 0.80%*** -- --
Net investment income................. 5.77%*** 5.79% 6.14%***
Portfolio turnover rate................. 33% 53% 81%
<CAPTION>
INVESTOR SHARES
-----------------------------------------------------
SIX MONTHS FOR THE PERIOD
ENDED YEAR MAY 1, 1997*
JUNE 30, ENDED THROUGH
1999 DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1998 1997
------------- ------------- ----------------
<S> <C><C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period................................ $10.61 $10.45 $10.08
------ ------ ------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.28 0.58 0.40
Net realized and unrealized gain (loss)
on investments........................ (0.49) 0.26 0.37
------ ------ ------
Total from investment operations...... (0.21) 0.84 0.77
------ ------ ------
DIVIDENDS AND DISTRIBUTION
Dividends from net investment
income................................ (0.28) (0.58) (0.40)
Distribution from capital gains......... -- (0.10) --
------ ------ ------
Total dividends and distribution...... (0.28) (0.68) (0.40)
------ ------ ------
Net asset value at end of period........ $10.12 $10.61 $10.45
------ ------ ------
------ ------ ------
TOTAL RETURN:........................... (1.99)%** 8.22% 7.76%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $4,240 $3,981 $1,891
Ratio to average net assets of:
Expenses, net of waiver from
The Bank of New York................ 1.08%*** 1.13% 1.06%***
Expenses, prior to waiver from The
Bank of New York.................... 1.11%*** -- --
Net investment income................. 5.48%*** 5.51% 5.74%***
Portfolio turnover rate................. 33% 53% 81%
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS FOR THE RESPECTIVE CLASS OF SHARES.
** NOT ANNUALIZED.
*** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
67
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL /S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- --------- --------- ---------- -----------
<C> <S> <C> <C> <C> <C>
MUNICIPAL BONDS--96.6%
EDUCATION--10.6%
$ 500,000 New York State Dormitory Authority,
Columbia University..................... Aaa/AAA 5.500% 7/1/2009 $ 524,710
500,000 New York State Dormitory Authority,
Fordham University...................... Aaa/AAA 4.400 7/1/2006 490,435
1,700,000 New York State Dormitory Authority, New
York University, MBIA Insured+.......... Aaa/AAA 5.500 7/1/2004 1,776,942
500,000 New York State Dormitory Authority,
Rochester Institute of Technology....... Aaa/AAA 5.000 7/1/2013 491,605
1,000,000 New York State Dormitory Authority,
University of Rochester................. A1/A+ 5.000 7/1/2002 1,018,960
-----------
4,302,652
-----------
GENERAL OBLIGATIONS--12.5%
500,000 Monroe County, New York................. Aa2/AA 4.050 3/1/2007 476,520
500,000 Monroe County, New York, MBIA
Insured+................................ Aaa/AAA 4.800 6/1/2002 508,285
60,000 Monroe County, New York, Series B,
Unrefunded Balance...................... Aa2/AA 7.000 6/1/2003 61,747
500,000 New York State Municipal Bond Bank
Agency (City of Rochester).............. NR/AAA 6.400 3/15/2001 519,855
500,000 New York State, General Obligation...... A2/A 4.375 7/15/2005 493,080
500,000 New York State, General Obligation...... A2/A 5.000 6/15/2011 493,790
1,000,000 New York State, General Obligation...... A2/A 5.125 6/15/2004 1,026,140
1,000,000 Orange County, New York, General
Obligation.............................. Aa2/NR 5.000 9/1/2013 985,960
500,000 Sands Point New York, General
Obligation.............................. Aa2/NR 4.700 7/15/2011 483,030
-----------
5,048,407
-----------
HEALTHCARE--2.3%
400,000 New York State Dormitory Authority,
Nursing Home Our Lady of Consolation.... NR/AA 5.200 8/1/2005 409,188
500,000 New York State Medical Care
Facilities--Downstate Medical Center.... NR/AAA 5.700 2/15/2004 523,710
-----------
932,898
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
68
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL /S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- --------- --------- ---------- -----------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
HOUSING--2.5%
$ 500,000 New York State Mortgage
Revenue--Homeowner Mtg Series 37-A...... Aa2/NR 5.850% 4/1/2006 $ 517,745
500,000 New York State Mortgage
Revenue--Homeowner Mtg Series 39........ Aa2/NR 5.300 4/1/2004 513,120
-----------
1,030,865
-----------
INDUSTRIAL DEVELOPMENT BONDS--5.0%
1,000,000 Hempstead Town--New York Industrial
Development Agency...................... Aaa/AAA 4.875 12/1/2006 1,005,840
1,000,000 Hempstead Town--New York Industrial
Development Agency...................... Aaa/AAA 5.000 12/1/2007 1,008,160
-----------
2,014,000
-----------
PREFUNDED/ESCROW/US GUARANTEED--4.0%
785,000 New York Housing Finance Agency, ETM
State University Construction........... Aaa/AAA 6.500 11/1/2006 836,229
500,000 New York State Thruway Authority Service
Contract Highway & Bridge Trust Fund
(original maturity 4/1/08).............. Baa1/NA 5.750 4/1/2004 533,420
232,000 Puerto Rico Aqueduct & Sewer Authority,
ETM..................................... Aaa/AAA 4.500 7/1/2002 233,550
-----------
1,603,199
-----------
SPECIAL TAX--20.8%
1,000,000 MTA Dedicated Tax Series A, MBIA
Insured+................................ Aaa/AAA 6.000 4/1/2005 1,067,370
1,000,000 Municipal Assistance Corp. for New York
City.................................... Aa2/AA 4.800 7/1/2003 1,014,530
2,000,000 Municipal Assistance Corp. for New York
City Series E........................... Aa2/AA 6.000 7/1/2005 2,141,100
650,000 New York State Local Government
Assistance Corp. ....................... A3/A+ 4.250 4/1/2002 648,960
500,000 New York State Local Government
Assistance Corp. ....................... A3/A+ 4.800 4/1/2005 503,210
655,000 New York State Local Government
Assistance Corp. ....................... A3/A+ 5.000 4/1/2002 666,397
340,000 New York State Local Government
Assistance Corp. ....................... A3/A+ 6.750 4/1/2002 359,785
750,000 New York, New York City Transitional
Finance Authority Revenue............... Aa3/AA 5.000 11/15/2010 746,100
1,225,000 New York, New York City Transitional
Finance Authority Revenue Series A...... Aa3/AA 5.000 8/15/2005 1,251,485
-----------
8,398,937
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
69
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL /S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- --------- --------- ---------- -----------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
STATE APPROPRIATION --19.4%
$1,000,000 Metropolitan Transportation Authority
Service Contract Revenue................ Baa1/BBB+ 5.750% 7/1/2007 $ 1,042,940
300,000 New York CTFS Partnership............... Baa1/BBB+ 4.125 9/1/2004 291,078
250,000 New York State Dormitory Authority,
Albany County........................... Baa1/BBB+ 5.500 4/1/2008 256,083
1,000,000 New York State Dormitory Authority,
Lease Revenue Office Facilities, Audit
and Control MBIA Insured+............... Aaa/AAA 4.375 4/1/2010 932,630
300,000 New York State Dormitory Authority,
State University........................ A3/A- 5.200 5/15/2003 306,732
650,000 New York State Dormitory Authority,
Upstate Community College............... Baa1/BBB+ 5.600 7/1/2007 670,709
505,000 New York State Medical Care
Facilities--Mental Health Services...... A3/A+ 4.700 8/15/2001 509,242
480,000 New York State Medical Care
Facilities--Mental Health Services...... A3/A- 6.100 8/15/2002 502,070
750,000 New York State Thruway Authority Service
Contract Highway & Bridge Trust Fund.... Baa1/BBB+ 5.625 4/1/2007 775,860
250,000 New York State Urban Development
Corp. .................................. Baa1/BBB+ 4.200 1/1/2004 244,385
500,000 New York State Urban Development
Corp. .................................. Baa1/BBB+ 5.000 1/1/2012 481,985
1,000,000 New York State Urban Development
Corp. .................................. Baa1/BBB+ 5.900 1/1/2007 1,039,910
750,000 New York State Urban Development
Corp. .................................. Baa1/BBB+ 6.000 1/1/2007 793,560
-----------
7,847,184
-----------
TRANSPORTATION--7.7%
500,000 Port Authority New York & New Jersey.... A1/AA- 4.750 10/1/2008 495,170
650,000 Port Authority New York & New Jersey.... A1/AA- 5.100 8/1/2001 663,501
1,000,000 Port Authority New York & New Jersey.... A1/AA- 5.300 8/1/2003 1,034,420
500,000 Port Authority New York & New Jersey.... A1/AA- 6.100 10/15/2002 528,130
400,000 Triborough Bridge & Tunnel Authority
General Purpose......................... Aa3/A+ 4.600 1/1/2005 400,500
-----------
3,121,721
-----------
UTILITIES--7.3%
1,500,000 Long Island Power Authority New York
Electric System Revenue Series A........ Aaa/AAA 5.500 12/1/2010 1,548,765
300,000 New York State Environmental Facilities
Corp. PCR State Water................... Aaa/AAA 6.000 5/15/2002 314,298
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
70
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL /S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- --------- --------- ---------- -----------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
$ 100,000 New York State Environmental Facilities
Corp. PCR State Water................... Aaa/AAA 6.300% 9/15/2000 $ 103,165
1,000,000 New York State Power Authority Revenue &
General Purpose Series A................ Aa3/AA- 4.250 2/15/2004 989,620
-----------
2,955,848
-----------
OTHER--4.5%
205,000 New York City, Trust for Cultural
Resources Museum MOMA-AMBAC Insured+.... Aaa/AAA 4.900 1/1/2001 207,515
75,000 New York City, Trust for Cultural
Resources Museum MOMA-AMBAC Insured+.... Aaa/AAA 5.000 1/1/2002 76,429
165,000 New York City, Trust for Cultural
Resources Museum MOMA-AMBAC Insured+.... Aaa/AAA 5.000 1/1/2002 167,986
350,000 New York City, Trust for Cultural
Resources Museum MOMA-AMBAC Insured+.... Aaa/AAA 6.300 1/1/2003 373,684
1,000,000 New York State Dormitory Authority,
Lease Revenue, Court Facilities,
Westchester County...................... Aa1/AA 5.125 8/1/2012 999,480
-----------
1,825,094
-----------
TOTAL MUNICIPAL BONDS
(Cost $38,892,485)...................... 39,080,805
-----------
</TABLE>
<TABLE>
<C> <S> <C> <C> <C> <C>
TAX-EXEMPT MONEY MARKET FUND--3.1%
1,245,379 Dreyfus New York Municipal Cash
Management (Cost $1,245,379)............ NR/NR 3.320(a) 1,245,379
-----------
TOTAL INVESTMENTS
(Cost $40,137,864)(b)--99.7%............ 40,326,184
Other assets less liabilities--0.3%..... 107,253
-----------
NET ASSETS--100.0%...................... $40,433,437
-----------
-----------
</TABLE>
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, 1999.
(b) THE COST STATED ALSO APPROXIMATES THE AGGREGATE COST FOR FEDERAL INCOME TAX
PURPOSES. AT JUNE 30, 1999, NET UNREALIZED APPRECIATION WAS $188,320 BASED
ON COST FOR FEDERAL INCOME TAX PURPOSES. THIS CONSISTED OF AGGREGATE GROSS
UNREALIZED APPRECIATION OF $535,231 AND AGGREGATE GROSS UNREALIZED
DEPRECIATION OF $346,911.
SEE NOTES TO FINANCIAL STATEMENTS.
71
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at value
(Cost $40,137,864)...................................... $ 40,326,184
Cash...................................................... 3,497
Receivables:
Interest................................................ 668,376
Capital stock sold...................................... 25,000
Other assets.............................................. 2,387
------------
TOTAL ASSETS.......................................... 41,025,444
------------
LIABILITIES:
Payables:
Investments purchased................................... 514,375
Dividends............................................... 43,450
Services provided by The Bank of New York and
Administrator......................................... 12,788
Capital stock repurchased............................... 7,613
Accrued expenses and other liabilities.................... 13,781
------------
TOTAL LIABILITIES..................................... 592,007
------------
NET ASSETS:................................................. $ 40,433,437
------------
------------
SOURCES OF NET ASSETS:
Capital stock @ par....................................... $ 3,925
Capital surplus........................................... 40,185,080
Accumulated net realized gain on investments.............. 56,112
Net unrealized appreciation on investments................ 188,320
------------
$ 40,433,437
------------
------------
INSTITUTIONAL SHARES:
Net assets................................................ $ 30,228,355
------------
------------
Shares outstanding........................................ 2,934,252
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 10.30
------------
------------
INVESTOR SHARES:
Net assets................................................ $ 10,205,082
------------
------------
Shares outstanding........................................ 990,499
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 10.30
------------
------------
Institutional Shares authorized @ $.001 par value........... 200,000,000
Investor Shares authorized @ $.001 par value................ 200,000,000
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest.................................................. $1,031,598
----------
EXPENSES:
Advisory.................................................. 110,775
Administration............................................ 44,310
12b-1 fee--Investor Shares................................ 15,547
Accounting services....................................... 29,784
Transfer agent............................................ 16,146
Directors................................................. 7,812
Custodian................................................. 5,255
Registration and filings.................................. 4,339
Reports to shareholders................................... 1,803
Cash management........................................... 818
Audit..................................................... 810
Legal..................................................... 192
Other..................................................... 167
----------
TOTAL EXPENSES.......................................... 237,758
Fees waived by The Bank of New York (Note 3).............. (34,809)
----------
NET EXPENSES............................................ 202,949
----------
NET INVESTMENT INCOME................................... 828,649
----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--
Net realized gain on investments.......................... 50,574
Decrease in unrealized appreciation on investments during
the period.............................................. (1,541,675)
----------
Net realized and unrealized loss on investments........... (1,491,101)
----------
Net decrease in net assets resulting from operations...... $ (662,452)
----------
----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
72
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, 1999 DECEMBER 31,
(UNAUDITED) 1998
---------------- ----------------
<S> <C> <C>
OPERATIONS:
Net investment income.................................................. $ 828,649 $ 1,619,015
Net realized gain on investments....................................... 50,574 256,154
Increase (decrease) in unrealized appreciation on investments during
the period........................................................... (1,541,675) 325,257
---------------- ----------------
Net increase (decrease) in net assets resulting from operations...... (662,452) 2,200,426
---------------- ----------------
DIVIDENDS AND DISTRIBUTION TO SHAREHOLDERS:
Dividends from net investment income: Institutional Shares............. (607,651) (1,239,196)
Investor Shares................. (220,998) (379,819)
Distribution from capital gains: Institutional Shares.................. -0- (29,529)
Investor Shares....................... -0- (9,845)
---------------- ----------------
(828,649) (1,658,389)
---------------- ----------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Institutional Shares................. 9,399,076 8,283,928
Investor Shares...................... 5,190,766 4,382,746
Proceeds from shares issued on reinvestment
of dividends and distributions: Institutional Shares................. 142,883 209,663
Investor Shares...................... 186,262 299,692
Cost of capital stock repurchased: Institutional Shares................ (9,748,192) (8,303,000)
Investor Shares..................... (6,345,215) (3,599,478)
---------------- ----------------
Net increase (decrease) in net assets resulting from capital stock
transactions....................................................... (1,174,420) 1,273,551
---------------- ----------------
INCREASE (DECREASE) IN NET ASSETS.................................. (2,665,521) 1,815,588
NET ASSETS:
Beginning of period.................................................... 43,098,958 41,283,370
---------------- ----------------
End of period.......................................................... $40,433,437 $43,098,958
---------------- ----------------
---------------- ----------------
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold: Institutional Shares...................................... 884,864 786,746
Investor Shares.......................................... 485,924 414,391
Shares issued on reinvestment of dividends: Institutional Shares....... 13,521 19,810
Investor Shares............. 17,603 28,363
Shares repurchased: Institutional Shares............................... (922,708) (786,244)
Investor Shares................................... (600,073) (341,124)
---------------- ----------------
Net increase (decrease).............................................. (120,869) 121,942
Shares outstanding, beginning of period................................ 4,045,620 3,923,678
---------------- ----------------
Shares outstanding, end of period...................................... 3,924,751 4,045,620
---------------- ----------------
---------------- ----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
73
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL SHARES
------------------------------------------------------
SIX MONTHS YEAR FOR THE PERIOD
ENDED ENDED APRIL 1, 1997*
JUNE 30, 1999 DECEMBER 31, THROUGH
(UNAUDITED) 1998 DECEMBER 31, 1997
----------------- ------------- ------------------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period................................ $ 10.65 $ 10.52 $ 10.16
------- ------------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.20 0.41 0.31
Net realized and unrealized gain (loss)
on investments........................ (0.35) 0.14 0.36
------- ------------- -------
Total from investment operations...... (0.15) 0.55 0.67
------- ------------- -------
DIVIDENDS AND DISTRIBUTION
Dividends from net investment income.... (0.20) (0.41) (0.31)
Distribution from capital gains......... -- (0.01) --
------- ------------- -------
Total dividends and distribution...... (0.20) (0.42) (0.31)
------- ------------- -------
Net asset value at end of period........ $ 10.30 $ 10.65 $ 10.52
------- ------------- -------
------- ------------- -------
TOTAL RETURN:........................... (1.44)%** 5.30% 6.69%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $30,228 $31,519 $30,915
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 0.85%*** 0.90% 0.90%***
Expenses, prior to waiver from The
Bank of New York.................... 1.00%*** 1.07% 1.15%***
Net investment income, net of waiver
from The Bank of New York........... 3.81%*** 3.85% 3.98%***
Portfolio turnover rate................. 14% 24% 21%
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
** NOT ANNUALIZED.
*** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
74
<PAGE>
BNY HAMILTON INTERMEDIATE NEW YORK TAX-EXEMPT FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INVESTOR SHARES
------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 1999 ------------------------------------------------------------
(UNAUDITED) 1998 1997 1996 1995 1994
-------------- ------------ -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of
period................................ $ 10.65 $ 10.52 $ 10.29 $ 10.34 $ 9.59 $ 10.37
------- ------------ -------- -------- -------- --------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.19 0.38 0.39 0.40 0.39 0.39
Net realized and unrealized gain (loss)
on investments........................ (0.35) 0.14 0.23 (0.05) 0.75 (0.78)
------- ------------ -------- -------- -------- --------
Total from investment operations...... (0.16) 0.52 0.62 0.35 1.14 (0.39)
------- ------------ -------- -------- -------- --------
DIVIDENDS AND DISTRIBUTION
Dividends from net investment income.... (0.19) (0.38) (0.39) (0.40) (0.39) (0.39)
Distribution from capital gains......... -- (0.01) -- -- -- --
------- ------------ -------- -------- -------- --------
Total dividends and distribution...... (0.19) (0.39) (0.39) (0.40) (0.39) (0.39)
------- ------------ -------- -------- -------- --------
Net asset value at end of period........ $ 10.30 $ 10.65 $ 10.52 $ 10.29 $ 10.34 $ 9.59
------- ------------ -------- -------- -------- --------
------- ------------ -------- -------- -------- --------
TOTAL RETURN:+.......................... (1.56)%* 5.04% 6.19% 3.47% 12.08% (3.81)%
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $10,205 $ 11,580 $ 10,368 $ 36,737 $ 40,931 $ 43,213
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 1.09%** 1.15% 1.02% 0.90% 0.90% 0.85%
Expenses, prior to waiver from The
Bank of New York.................... 1.25%** 1.32% 1.32% 1.18% 1.20% 1.20%
Net investment income, net of waiver
from The Bank of New York........... 3.55%** 3.61% 3.88% 3.91% 3.89% 3.92%
Portfolio turnover rate................. 14% 24% 21% 22% 4% 18%
</TABLE>
+ TOTAL RETURN DOES NOT CONSIDER THE EFFECT OF THE SALES LOAD FOR THOSE
PERIODS IN WHICH THE SALES LOAD WAS IN EFFECT.
* NOT ANNUALIZED.
** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
75
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL / S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- ---------- -------- ------------ ------------
<C> <S> <C> <C> <C> <C>
MUNICIPAL BONDS--97.6%
EDUCATION--11.3%
$2,000,000 California Education Facilities
Authority Revenue....................... Aa1/NR 4.500% 11/1/2013 $ 1,886,660
1,190,000 California Education Facilities
Authority Revenue....................... A3/NR 4.700 4/1/2012 1,119,481
1,000,000 District of Columbia Revenue
(Association of American Medical
Colleges), Series A, Callable 8/15/07
@102.................................... Aaa/AAA 5.150 2/15/2010 988,670
4,000,000 Illinois Educational Facility Authority
Revenue................................. Aa1/AA 4.400 7/1/2025 3,976,960
1,000,000 Illinois Educational Facility Authority
Revenue (University of Chicago), Series
A....................................... Aa1/AA 5.000 7/1/2008 1,002,150
1,190,000 New England Educational Loans Revenue... Aaa/NR 5.800 3/1/2002 1,228,425
1,315,000 New York State Dormitory Authority
Revenue................................. Aaa/NR 4.400 7/1/2011 1,234,246
1,000,000 New York State Dormitory Authority
Revenue................................. Aaa/AAA 4.625 7/1/2010 960,780
2,450,000 New York State Dormitory Authority
Revenue................................. Baa1/BBB+ 5.000 7/1/2008 2,425,524
20,000 New York State Dormitory Authority
Revenue, Unrefunded Balance, University
of Rochester; Callable 9/3/99 @101...... A1/A+ 6.200 7/1/2002 20,227
500,000 New York State Dormitory Authority,
Rochester Institute of Technology....... Aaa/AAA 5.000 7/1/2013 491,605
1,600,000 Pennsylania State Higher Education
Facility Authority Carnegie-Mellon...... NR/AA- 5.000 11/1/2000 1,627,312
2,020,000 Private Colleges & Universities Auth.
(Emory University)...................... Aa1/AA 5.500 11/1/2006 2,117,889
1,000,000 Swarthmore Borough Authority
Pennsylvania Swarthmore College......... Aaa/AA+ 5.000 9/15/2007 1,016,080
1,000,000 Swarthmore Borough Authority
Pennsylvania Swarthmore College......... Aaa/AA+ 5.000 9/15/2008 1,010,220
1,000,000 Swarthmore Borough Authority
Pennsylvania Swarthmore College......... Aaa/AA+ 5.250 9/15/2009 1,026,160
2,185,000 Texas A & M University Revenue, Callable
5/15/07 @100............................ Aa2/AA 5.000 5/15/2008 2,196,165
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
76
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL / S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- ---------- -------- ------------ ------------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
$5,255,000 Texas State Refunding Series C.......... Aa2/AA 5.000% 8/1/2009 $ 5,277,649
------------
29,606,203
------------
GENERAL OBLIGATIONS--35.6%
1,000,000 Aldine Texas Independent School
District, Callable, 2/15/07 @100........ Aaa/AAA 5.375 2/15/2009 1,024,750
2,150,000 California State........................ Aa3/A+ 5.000 12/1/2006 2,222,584
4,000,000 California State........................ A1/A+ 5.000 10/1/2002 4,114,480
2,970,000 Charlotte North Carolina Water &
Sewer................................... Aaa/AAA 5.500 5/1/2003 3,090,344
3,000,000 Chicago Illinois........................ Aaa/AAA 5.500 1/1/2012 3,093,120
3,000,000 Connecticut State Series A.............. Aa/AA- 5.000 5/15/2004 3,084,690
2,500,000 Delaware State.......................... Aa1/AA+ 5.125 4/1/2005 2,576,975
2,880,000 El Paso Texas........................... Aaa/AAA 4.400 8/15/2010 2,730,470
2,835,000 El Paso Texas........................... Aaa/AAA 4.500 8/15/2011 2,692,286
5,000,000 Georgia State........................... Aaa/AA+ 5.250 7/1/2008 5,174,000
2,000,000 Illinois State.......................... Aa2/AA 5.000 6/1/2006 2,029,120
2,000,000 Illinois State.......................... Aa2/AA 5.000 6/1/2007 2,020,760
1,005,000 Kansas City Missouri.................... Aa3/AA 5.000 9/1/2006 1,023,110
2,000,000 Magnolia Texas Independent School
District................................ Aaa/NR 4.400 8/15/2009 1,888,120
2,185,000 Maryland State & Local Facilities
Loan.................................... Aaa/AAA 5.250 6/15/2005 2,275,568
2,000,000 Maryland State & Local Facilities
Loan--3rd Series, callable 10/15/06
@100.................................... Aaa/AAA 5.000 10/15/2007 2,042,740
1,485,000 Massachusetts State--Construction Loan
Series A................................ A1/A+ 5.100 11/1/2002 1,525,184
2,000,000 Massachusetts State--Construction Loan
Series D, FGIC Insured+................. Aaa/AAA 5.125 11/1/2003 2,059,740
1,300,000 Milwaukee Wisconsin..................... Aa1/AA+ 5.000 6/15/2008 1,309,308
1,000,000 Milwaukee Wisconsin Area Technical
College District........................ Aa2/NR 3.650 6/1/2002 981,670
2,000,000 Milwaukee Wisconsin Metropolitan Sewer
District................................ Aa/AA 6.250 10/1/2004 2,157,100
2,070,000 Minnesota State, Callable 11/01/06
@100.................................... Aaa/AA+ 5.000 11/1/2008 2,099,042
1,290,000 Montana State........................... Aa3/AA- 5.000 8/1/2008 1,311,620
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
77
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL / S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- ---------- -------- ------------ ------------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
$3,215,000 Nevada State Municipal Bond............. Aa/AA 6.375% 5/15/2006 $ 3,517,178
2,760,000 Nevada State Municipal Bond Bank Project
#66 & 67 Series A, Callable 5/15/08..... Aa2/AA 5.250 5/15/2010 2,798,916
4,470,000 Nevada State Series A................... Aa/AA 4.375 8/1/2003 4,465,709
2,000,000 New Jersey State Series E............... Aa1/AA+ 5.000 7/15/2004 2,056,420
1,000,000 New York State.......................... A2/A 5.000 9/15/2006 1,016,260
1,430,000 North Carolina State.................... Aaa/AAA 4.500 5/1/2007 1,412,268
3,000,000 Pennsylvania State...................... Aaa/AAA 5.000 6/1/2008 3,025,650
2,970,000 Pennsylvania State--1st Series.......... A1/AA- 5.000 5/1/2003 3,033,142
2,000,000 Rhode Island, Callable 8/01/07 @101,
MBIA Insured+........................... Aaa/AAA 5.000 8/1/2009 2,001,480
2,000,000 Round Rock Texas Independent School
District................................ Aaa/AAA 4.400 8/1/2011 1,845,480
1,000,000 Texas State Public Finance Authority
Building Revenue........................ Aaa/AAA 6.100 8/1/2004 1,056,490
500,000 Tulsa Oklahoma.......................... Aa/AA 5.150 6/1/2003 514,435
3,000,000 Virginia State Public School
Authority............................... Aa1/AA+ 4.500 8/1/2011 2,805,510
4,330,000 Washington State........................ Aa1/AA+ 6.250 9/1/2007 4,737,583
1,000,000 Washington State Series A............... Aa/AA 6.700 2/1/2005 1,099,270
1,500,000 Washington State Series R............... Aa/AA 5.375 10/1/2008 1,551,255
3,000,000 Wisconsin State......................... Aa2/AA 5.250 5/1/2007 3,087,090
1,000,000 Woods Hole Martha's Vineyard Nantucket
Massachusetts........................... Aa3/NR 4.000 3/1/2007 957,170
------------
93,508,087
------------
HEALTHCARE--5.2%
5,270,000 Indiana Health Facility Financing
Authority Hospital Revenue--(Charity
Obligation Group)....................... Aa2/AA+ 5.000 11/1/2026 5,266,100
2,000,000 Jacksonville Florida Health Facilities
Authority Hospital Revenue.............. Aa2/AA+ 4.875 8/15/2007 1,986,000
575,000 New York State Medical Care Facilities
(St. Luke's Hospital), Series A,
Callable 2/15/00 @102................... Aa/AA 7.400 2/15/2009 599,300
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
78
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL / S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- ---------- -------- ------------ ------------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
$ 770,000 New York State Medical Care Facilities
Financial Agency........................ Aa/AA+ 5.100% 2/15/2005 $ 780,849
1,000,000 North Carolina Medical Care Facility
(Duke University Health Systems Series
A)...................................... Aa3/AA 4.600 6/1/2009 960,210
2,000,000 Pennsylvania State Higher Educational
Facilities Authority--(University of
Pennsylvania Health Services)........... Aa/AA 5.000 1/1/2009 2,000,000
2,000,000 Tampa Florida Revenue Health System--
Catholic Health East.................... Aaa/AAA 5.500 11/15/2006 2,087,240
------------
13,679,699
------------
HOUSING--1.5%
1,000,000 Alaska State Housing Finance Corporation
Mortgage Series A-1, Callable 12/01/07
@101.50, MBIA Insured+.................. Aaa/AAA 5.000 12/1/2008 1,012,700
500,000 Connecticut State Housing Financial
Authority--Housing Mortgage Finance
Program................................. Aa2/AA 5.300 11/15/2003 518,755
2,250,000 Housing New York Corporation Revenue.... A1/AA 6.000 11/1/2003 2,375,100
------------
3,906,555
------------
INDUSTRIAL DEVELOPMENT BONDS--0.4%
1,000,000 Georgetown County South Carolina
Pollution Control Facilities
(International Paper Company Project),
Callable 6/15/02 @102................... A3/A- 6.250 6/15/2005 1,054,060
------------
OTHER--0.1%
200,000 New York State Dormitory Authority
Revenue Metropolitan Museum of Art
Series B, Floating Rate Notes, payable
monthly, interest rate resets weekly,
next interest rate reset date 7/7/99.... Aa1/AA+ 3.250 ++ 7/1/2023 200,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
79
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL / S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- ---------- -------- ------------ ------------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
$ 100,000 New York State Local Government
Assistance Corp. Series A, Floating Rate
Notes, payable monthly, interest rate
resets weekly, next interest rate rest
date 7/7/99............................. Aa2/AA+ 3.250%++ 4/1/2022 $ 100,000
------------
300,000
------------
PRE-REFUNDED SECURITIES--2.4%
1,085,000 Illinois State Toll Highway Authority
Callable 9/03/99 @100................... Aaa/AAA 6.750 1/1/2010 1,159,084
555,000 Manatee County Florida Water Revenue,
Callable 9/03/99 @101................... Aaa/AAA 4.200 3/1/2005 551,004
155,000 Monroe County New York, Callable 6/01/04
@102.................................... Aaa/AAA 6.000 6/1/2011 164,430
845,000 New Jersey State Highway
Authority--Garden State Parkway General
Revenue, Callable 9/3/99 @100........... NR/AAA 6.500 1/1/2011 915,591
2,275,000 New Jersey State Turnpike Authority
Revenue................................. Aaa/NR 5.700 5/1/2013 2,375,737
105,000 New Jersey State Turnpike Authority
Revenue, Callable 9/03/99 @100.......... Aaa/AAA 5.875 1/1/2008 109,464
870,000 Sacramento California Municipal Utility
District Revenue, Callable 9/03/99
@100.................................... Aaa/AAA 5.500 2/1/2011 900,537
------------
6,175,847
------------
PRE-REFUNDED ESCROWED--1.8%
1,255,000 King County Washington, ETM............. Aa1/AA+ 5.000 1/1/2004 1,281,857
1,585,000 King County Washington, ETM............. Aa1/AA+ 5.000 1/1/2004 1,617,619
1,200,000 New Jersey State Turnpike Authority
Revenue, ETM............................ Aaa/AAA 6.500 1/1/2008 1,327,812
483,243 New York State Dormitory Authority
Revenue................................. NR/NR 7.000 9/25/2006 549,735
------------
4,777,023
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
80
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL / S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- ---------- -------- ------------ ------------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
SPECIAL TAX--7.4%
$2,585,000 Chicago Illinois Sales Tax Revenue...... Aaa/AAA 6.000% 1/1/2007 $ 2,756,722
1,100,000 Chicago Illinois Sales Tax Revenue...... Aaa/AAA 5.000 1/1/2008 1,099,241
510,000 Clark County Nevada--Las Vegas
Convention and Visitors Authority....... Aaa/AAA 5.400 7/1/2003 528,115
1,000,000 Connecticut State Special Obligation
Revenue................................. A1/AA- 6.100 9/1/2008 1,087,400
1,100,000 Indiana Bond Bank Revenue Series A...... NR/AAA 5.750 2/1/2006 1,159,631
5,000,000 Indianapolis Industrial Local Public
Improvement Bank........................ Aaa/AAA 5.500 2/1/2008 5,211,550
155,000 Kentucky Infrastructure Authority....... NR/A 7.625 8/1/2003 158,626
2,000,000 Municipal Assistance Corp. for New York
City Series E........................... Aa2/AA 6.000 7/1/2005 2,141,100
1,805,000 New York State Local Government
Assistance Corp. ....................... A/A 6.000 4/1/2006 1,929,581
1,980,000 New York State Local Government
Assistance Corp. Series A............... A3/A 6.000 4/1/2012 2,129,985
1,250,000 New York State Local Government
Assistance Corp. Series A, Callable
4/01/07 @101............................ Aaa/AAA 5.000 4/1/2009 1,254,688
------------
19,456,639
------------
STATE APPROPRIATION--14.2%
1,980,000 Kentucky State Turnpike Authority
Economic Development Road Revenue
(Revitalization Projects)............... Aaa/AAA 5.300 7/1/2004 2,052,052
2,000,000 Kentucky State Turnpike Authority
Economic Development Road Revenue,
(Revitalization Projects)............... Aaa/AAA 5.500 7/1/2008 2,089,480
1,000,000 Massachusetts Bay Transportation
Authority............................... A1/A+ 5.400 3/1/2008 1,033,330
2,050,000 Metropolitan Transportation Authority
Facility Revenue........................ Baa1/BBB+ 5.500 7/1/2021 2,113,591
2,000,000 New York State CTFS Partnership......... Baa1/BBB+ 4.000 9/1/2002 1,971,820
2,000,000 New York State CTFS Partnership......... Baa1/BBB+ 4.300 8/1/2002 1,990,240
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
81
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL / S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- ---------- -------- ------------ ------------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
$3,000,000 New York State Dormitory Authority State
University.............................. A3/A- 6.000% 5/15/2007 $ 3,193,110
1,980,000 New York State Dormitory Authority State
University Educational Facilities....... Baa1/BBB+ 5.250 5/15/2010 1,994,573
5,000,000 New York State Thruway Authority Service
Contract Revenue........................ Baa1/BBB+ 5.100 4/1/2008 4,978,700
2,005,000 New York State Thruway Authority Service
Contract Revenue........................ Baa1/BBB 7.000 1/1/2002 2,113,350
3,550,000 New York State Urban Development Corp.
Revenue................................. Baa1/BBB+ 5.000 1/1/2014 3,377,612
2,000,000 New York State Urban Development Corp.
Revenue................................. Baa1/BBB+ 5.000 1/1/2007 1,993,820
1,500,000 New York State Urban Development Corp.
Revenue................................. Baa1/BBB 5.450 1/1/2007 1,536,525
4,705,000 New York State Urban Development Corp.
Revenue Callable 1/01/08 @102........... Baa1/BBB+ 5.000 1/1/2014 4,476,525
2,500,000 New York State Urban Development Corp.
Revenue Callable 1/01/08 @102........... Baa1/BBB+ 5.000 1/1/2013 2,393,450
------------
37,308,178
------------
TRANSPORTATION--8.8%
1,000,000 Central Puget Sound, Washington Transit
Authority............................... Aaa/AAA 5.250 2/1/2009 1,016,520
1,150,000 Delaware Transportation Authority System
Revenue................................. A1/AA 6.125 7/1/2003 1,212,353
1,500,000 Kansas State Department of
Transportation Highway Revenue.......... Aa/AA 5.375 3/1/2007 1,558,590
350,000 Kentucky State Turnpike Authority Toll
Road Revenue............................ A/A 8.500 7/1/2004 351,337
1,750,000 Mississippi Highway Revenue............. Aa1/NR 5.250 6/1/2008 1,793,750
2,000,000 New Jersey State Highway Authority
Garden State Parkway General Revenue.... A1/AA- 5.150 1/1/2007 2,050,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
82
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL / S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- ---------- -------- ------------ ------------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
$2,500,000 New Jersey State Transportation
Authority............................... Aaa/AAA 6.250% 12/15/2003 $ 2,695,825
2,450,000 New Jersey State Transit Transportation
Fund.................................... Aa2/AA- 5.250 6/15/2008 2,513,308
480,000 New Jersey State Turnpike Authority
Revenue................................. NR/AAA 10.375 1/1/2003 538,099
1,000,000 New York State Bridge Authority
Revenue................................. Aa/AA- 5.000 1/1/2007 1,015,620
990,000 Pennsylvania State Turnpike Revenue..... Aaa/AAA 5.350 12/1/2002 1,023,650
3,630,000 Port Authority New York & New Jersey
Callable 11/01/99 @100.................. A1/AA- 9.000 11/1/2014 3,692,255
2,105,000 Port of Seattle Washington Revenue...... Aaa/AAA 6.000 10/1/2007 2,267,843
1,130,000 Triborough Bridge & Tunnel Authority
Series Q, Callable 1/01/06 @100......... Aa3/A+ 6.750 1/1/2009 1,272,425
------------
23,001,575
------------
UTILITIES--8.9%
5,000,000 Austin Texas Utility System Revenue
Series A, Callable 11/15/06 @100........ Aaa/AAA 5.000 5/15/2007 5,039,600
85,000 Austin Texas Utility System Revenue
Series B, Unrefunded balance Callable
11/15/99 @101........................... A/A 7.250 11/15/2003 94,254
735,000 Consumers Public Power District Nuclear
Facility Revenue........................ A1/NR 5.100 1/1/2003 735,757
3,150,000 Dade County Florida Water & Sewer System
Revenue................................. Aaa/AAA 6.250 10/1/2007 3,457,944
990,000 Georgia Municipal Electrical Authority
Power Revenue........................... A/A 5.000 1/1/2004 1,000,722
1,000,000 Grant County Washington Public Utility
District No. 002........................ Aa/A+ 5.600 1/1/2005 1,038,780
1,000,000 Houston Texas Water Conveyance System
Contract................................ Aaa/AAA 7.000 12/15/2004 1,107,550
5,000 Jacksonville Florida Electrical
Authority Revenue....................... Aa1/AA 7.500 10/1/2002 5,016
4,000,000 Long Island New York Power Authority
Electric System Revenue................. Aaa/AAA 5.500% 4/1/2008 4,147,560
2,000,000 Long Island Power Authority New York
Electric System Revenue................. Aaa/AAA 5.000 4/1/2008 2,004,060
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
83
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MOODY'S
PRINCIPAL / S&P INTEREST MATURITY
AMOUNT RATINGS RATE DATE VALUE
- ---------- ---------- -------- ------------ ------------
MUNICIPAL BONDS (CONTINUED)
<C> <S> <C> <C> <C> <C>
$1,000,000 Long Island Power Authority New York
Electric System Revenue Series A........ Aaa/AAA 5.500% 12/1/2010 $ 1,032,510
1,000,000 New York State Environmental Facilities
Corp. Pollution Control Revenue Loan.... Aaa/AAA 5.000 7/14/2004 1,024,570
2,000,000 New York State Power Authority Revenue &
General Purpose......................... Aa3/AA- 4.375 2/15/2005 1,975,880
750,000 South Carolina State Public Service
Authority Electrical Revenue &
Electrical System Expansion............. Aa/A+ 4.100 7/1/2006 723,848
------------
23,388,051
------------
TOTAL MUNICIPAL BONDS
(Cost $255,144,993)..................... 256,161,917
------------
</TABLE>
<TABLE>
<C> <S> <C> <C> <C> <C>
TAX-EXEMPT MONEY MARKET FUND--0.9%
2,355,032 Dreyfus Municipal Money Market Fund
(Cost $2,355,032)....................... NR/NR 2.97 (a) 2,355,032
------------
TOTAL INVESTMENTS
(Cost $257,500,025)(b)--98.5%........... 258,516,949
Other assets less liabilities--1.5%..... 3,817,340
------------
NET ASSETS--100.0%...................... $262,334,289
------------
------------
</TABLE>
N/R NOT RATED BY MOODY'S OR STANDARD & POOR'S (S&P).
+ INSURED OR GUARANTEED BY THE INDICATED MUNICIPAL BOND INSURANCE
CORPORATION.
++ REPRESENTS INTEREST RATE IN EFFECT JUNE 30, 1999 FOR FLOATING RATES NOTES.
(a) REPRESENTS ANNUALIZED YIELD AT JUNE 30, 1999.
(b) THE COST STATED ALSO APPROXIMATES THE AGGREGATE COST FOR THE FEDERAL INCOME
TAX PURPOSES. AT JUNE 30, 1999, NET UNREALIZED APPRECIATION WAS $1,016,924
BASED ON COST FOR FEDERAL INCOME TAX PURPOSES. THIS CONSISTED OF AGGREGATE
GROSS UNREALIZED APPRECIATION OF $3,951,205 AND AGGREGATE GROSS UNREALIZED
DEPRECIATION OF $2,934,281.
SEE NOTES TO FINANCIAL STATEMENTS.
84
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
DIVERSIFICATION BY STATE
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
% OF
TOTAL
VALUE NET ASSETS
------------ ----------
<S> <C> <C>
Alaska.................................. $ 1,012,700 0.4%
California.............................. 10,243,742 3.9
Connecticut............................. 4,690,845 1.8
Delaware................................ 3,789,328 1.4
District of Columbia.................... 988,670 0.4
Florida................................. 8,087,204 3.1
Georgia................................. 8,292,611 3.1
Illinois................................ 17,137,156 6.5
Indiana................................. 11,637,281 4.4
Kansas.................................. 1,558,590 0.6
Kentucky................................ 4,651,495 1.8
Maryland................................ 4,318,308 1.6
Massachusetts........................... 6,803,849 2.6
Minnesota............................... 2,099,042 0.8
Mississippi............................. 1,793,750 0.7
Missouri................................ 1,023,110 0.4
Montana................................. 1,311,620 0.5
Nebraska................................ 735,757 0.3
Nevada.................................. 11,309,918 4.3
New Jersey.............................. 14,582,256 5.5
New York................................ 66,671,607 25.4
North Carolina.......................... 5,462,822 2.1
Oklahoma................................ 514,435 0.2
Pennsylvania............................ 13,762,214 5.2
Rhode Island............................ 2,001,480 0.8
South Carolina.......................... 1,777,908 0.7
Texas................................... 24,952,814 9.5
Virginia................................ 2,805,510 1.1
Washington.............................. 14,610,727 5.6
Wisconsin............................... 7,535,168 2.9
Tax-exempt money market fund (various
states)............................... 2,355,032 0.9
------------ -----
Total value of investments.............. 258,516,949 98.5
Other assets less liabilities........... 3,817,340 1.5
------------ -----
Net Assets.............................. $262,334,289 100.0%
------------ -----
------------ -----
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
85
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at value (Cost $257,500,025).................. $258,516,949
Cash...................................................... 303,439
Receivables:
Investments sold........................................ 7,148,369
Interest................................................ 4,242,635
Capital stock sold...................................... 649,473
Deferred organization costs and other assets.............. 6,892
------------
TOTAL ASSETS.......................................... 270,867,757
------------
LIABILITIES:
Payables:
Investments purchased................................... 7,846,009
Dividends............................................... 285,433
Services provided by The Bank of New York and
Administrator......................................... 172,916
Capital stock repurchased............................... 6,601
Accrued expenses and other liabilities.................... 222,509
------------
TOTAL LIABILITIES..................................... 8,533,468
------------
NET ASSETS: $262,334,289
------------
------------
SOURCES OF NET ASSETS:
Capital stock @ par....................................... $ 26,820
Capital surplus........................................... 259,767,147
Undistributed net investment income....................... 5,355
Accumulated net realized gain on investments.............. 1,518,043
Net unrealized appreciation on investments................ 1,016,924
------------
NET ASSETS.................................................. $262,334,289
------------
------------
INSTITUTIONAL SHARES:
Net assets................................................ $261,922,474
------------
------------
Shares outstanding........................................ 26,777,529
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 9.78
------------
------------
INVESTOR SHARES:
Net assets................................................ $ 411,815
------------
------------
Shares outstanding........................................ 42,068
------------
------------
Net asset value, offering price and repurchase price per
share................................................... $ 9.79
------------
------------
Institutional Shares authorized @ $.001 par value........... 200,000,000
Investor Shares authorized @ $.001 par value................ 200,000,000
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest.................................................. $ 6,308,903
-----------
EXPENSES:
Advisory.................................................. 672,630
Administration............................................ 269,053
12b-1 fee--Investor Shares................................ 542
Accounting services....................................... 29,744
Transfer agent............................................ 24,089
Custodian................................................. 19,245
Registration and filings.................................. 15,994
Organization.............................................. 8,205
Directors................................................. 7,812
Reports to shareholders................................... 7,254
Audit..................................................... 7,064
Insurance................................................. 4,804
Legal..................................................... 2,892
Cash management........................................... 351
Other..................................................... 17,362
-----------
TOTAL EXPENSES.......................................... 1,087,041
Fees waived by the Bank of New York (Note 3)............ (4,890)
Earnings credit adjustment (Note 3)..................... (163)
-----------
NET EXPENSES............................................ 1,081,988
-----------
NET INVESTMENT INCOME................................... 5,226,915
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--
Net realized gain on investments.......................... 891,918
Decrease in unrealized appreciation on investments during
the period.............................................. (11,826,490)
-----------
Net realized and unrealized loss on investments........... (10,934,572)
-----------
Net decrease in net assets resulting from operations...... $(5,707,657)
-----------
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
86
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR
JUNE 30, 1999 ENDED
(UNAUDITED) DECEMBER 31, 1998
------------------ -------------------
<S> <C> <C>
OPERATIONS:
Net investment income............................................... $ 5,226,915 $ 10,953,021
Net realized gain on investments.................................... 891,918 5,488,044
Decrease in unrealized appreciation on investments during the
period............................................................ (11,826,490) (2,389,727)
------------------ -------------------
Net increase (decrease) in net assets resulting from operations... (5,707,657) 14,051,338
------------------ -------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income: Institutional Shares.......... (5,219,866) (10,942,519)
Investor Shares............... (7,049) (12,153)
Distributions from capital gains: Institutional Shares.............. -0- (5,340,052)
Investor Shares................... -0- (9,348)
------------------ -------------------
(5,226,915) (16,304,072)
------------------ -------------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Institutional Shares.............. 33,149,367 33,561,190
Investor Shares................... 51,094 627,121
Proceeds from shares issued on reinvestment
of dividends: Institutional Shares................................ 124,719 5,446,616
Investor Shares................................... 6,931 16,709
Cost of capital stock repurchased: Institutional Shares............. (30,497,720) (35,781,571)
Investor Shares.................. (104,005) (357,246)
------------------ -------------------
Net increase in net assets resulting from capital stock
transactions.................................................... 2,730,386 3,512,819
------------------ -------------------
INCREASE (DECREASE) IN NET ASSETS............................... (8,204,186) 1,260,085
NET ASSETS:
Beginning of period................................................. 270,538,475 269,278,390
------------------ -------------------
End of period (includes undistributed net investment income of
$5,355 at June 30, 1999 and $5,355 at December 31, 1998).......... $ 262,334,289 $ 270,538,475
------------------ -------------------
------------------ -------------------
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold: Institutional Shares................................... 3,282,153 3,265,028
Investor Shares...................................... 5,192 60,849
Shares issued on reinvestment of dividends
and distributions: Institutional Shares........................... 12,375 534,826
Investor Shares................................ 686 1,631
Shares repurchased: Institutional Shares............................ (10,259) (3,478,108)
Investor Shares................................. (3,028,074) (34,862)
------------------ -------------------
Net increase...................................................... 262,073 349,364
Shares outstanding, beginning of period............................. 26,557,524 26,208,160
------------------ -------------------
Shares outstanding, end of period................................... 26,819,597 26,557,524
------------------ -------------------
------------------ -------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
87
<PAGE>
BNY HAMILTON INTERMEDIATE TAX-EXEMPT FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INSTITUTIONAL SHARES
---------------------------------------------------
FOR THE
PERIOD
SIX MONTHS YEAR APRIL 1, 1997*
ENDED JUNE ENDED THROUGH
30, 1999 DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1998 1997
------------ ------------- ---------------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period.. $ 10.19 $ 10.27 $ 10.00
------------ ------------- ---------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.19 0.41 0.33
Net realized and unrealized gain on
investments........................... (0.41) 0.13 0.31
------------ ------------- ---------------
Total from investment operations...... (0.22) 0.54 0.64
------------ ------------- ---------------
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment
income................................ (0.19) (0.41) (0.33)
Distributions from capital gains........ -- (0.21) (0.04)
------------ ------------- ---------------
Total dividends and distributions..... (0.19) (0.62) (0.37)
------------ ------------- ---------------
Net asset value at end of period........ $ 9.78 $ 10.19 $ 10.27
------------ ------------- ---------------
------------ ------------- ---------------
TOTAL RETURN:........................... (2.15)%** 5.37% 6.50%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $261,922 $270,065 $269,085
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 0.80%*** 0.83% 0.81%***
Expenses, prior to waiver from The
Bank of New York.................... 0.81%*** 0.83% 0.81%***
Net investment income, net of waiver
from The Bank of New York........... 3.89%*** 4.03% 4.36%***
Portfolio turnover rate................. 22% 37% 30%
<CAPTION>
INVESTOR SHARES
-----------------------------------------------------
FOR THE
PERIOD
SIX MONTHS YEAR MAY 1, 1997*
ENDED JUNE ENDED THROUGH
30, 1999 DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1998 1997
------------- ------------- ----------------
<S> <C><C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period.. $10.19 $10.28 $ 9.99
------------- ------------- ------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.18 0.38 0.27
Net realized and unrealized gain on
investments........................... (0.40) 0.12 0.33
------------- ------------- ------
Total from investment operations...... (0.22) 0.50 0.60
------------- ------------- ------
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment
income................................ (0.18) (0.38) (0.27)
Distributions from capital gains........ -- (0.21) (0.04)
------------- ------------- ------
Total dividends and distributions..... (0.18) (0.59) (0.31)
------------- ------------- ------
Net asset value at end of period........ $ 9.79 $10.19 $10.28
------------- ------------- ------
------------- ------------- ------
TOTAL RETURN:........................... (2.19)%** 4.95% 6.08%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $ 412 $ 473 $ 194
Ratio to average net assets of:
Expenses, net of waiver from The Bank
of New York......................... 1.04%*** 1.13% 1.15%***
Expenses, prior to waiver from The
Bank of New York.................... 1.06%*** 1.13% 1.15%***
Net investment income, net of waiver
from The Bank of New York........... 3.66%*** 3.74% 3.98%***
Portfolio turnover rate................. 22% 37% 30%
</TABLE>
* COMMENCEMENT OF OPERATIONS FOR THE RESPECTIVE CLASS OF SHARES.
** NOT ANNUALIZED.
*** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
88
<PAGE>
BNY HAMILTON MONEY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- --------------
<C> <S> <C>
COMMERCIAL PAPER+--45.9%
ASSET BACKED SECURITIES--CREDIT CARDS--0.7%
$20,000,000 Riverwoods Funding Corp., 4.80%,
08/02/99................................ $ 19,914,667
--------------
ASSET BACKED SECURITIES--TRADE & LEASE RECEIVABLES
(PARTIAL SUPPORT)-- 4.3%
30,000,000 Barton, 4.82%, 07/08/99................. 29,971,883
20,000,000 Cafco, 4.85%, 07/21/99.................. 19,946,111
30,000,000 Ciesco,, 4.78%, 07/19/99................ 29,928,300
20,000,000 Ciesco,, 4.90%, 08/10/99................ 19,891,111
25,000,000 Sheffield Receivables Corp., 5.03%,
07/16/99................................ 24,947,604
--------------
124,685,009
--------------
ASSET BACKED SECURITIES-TRADE & LEASE RECEIVABLES--2.1%
25,000,000 MT BLANC, 4.87%, 07/08/99............... 24,976,326
9,181,765 Premier Auto Trust, 4.995%, 12/08/99.... 9,182,278
28,000,000 Premier Auto Trust, 5.116%, 03/08/00.... 27,995,428
--------------
62,154,032
--------------
BANKS--MONEY CENTER--0.5%
15,000,000 Bank of America Corp., 4.87%,
08/23/99................................ 14,892,454
--------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- --------------
<C> <S> <C>
COMMERCIAL PAPER+ (CONTINUED)
CHEMICALS--BASIC--2.0%
$10,000,000 duPont (E.I) de Nemoures & Co., 4.998%,
04/14/00................................ $ 9,992,210
23,000,000 duPont (E.I.) de Nemoures & Co., 4.86%,
07/20/99................................ 22,941,005
25,000,000 duPont (E.I.) de Nemoures & Co., 4.88%,
08/17/99................................ 24,840,722
--------------
57,773,937
--------------
COMMUNICATIONS & ENTERTAINMENT-- 1.0%
30,000,000 Gannett Co., 5.10%, 07/19/99............ 29,923,500
--------------
ELECTRICAL EQUIPMENT--2.4%
10,000,000 Emerson Electric Co., 5.25%, 01/18/00... 9,706,875
30,000,000 Emerson Electric Co., 4.95%, 07/12/99... 29,954,625
30,000,000 Siemens Corp., 4.92%, 09/30/99.......... 29,626,900
--------------
69,288,400
--------------
FINANCE COMPANIES--1.5%
20,000,000 American Express Credit, 4.82%,
07/19/99................................ 19,951,800
25,000,000 Ford Motor Credit Co., 4.95%,
07/08/99................................ 24,976,618
--------------
44,928,418
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
89
<PAGE>
BNY HAMILTON MONEY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- --------------
COMMERCIAL PAPER+ (CONTINUED)
<C> <S> <C>
FINANCIAL SERVICES--5.5%
$32,505,000 General Reinsurance, 5.20%, 07/16/99.... $ 32,434,573
20,000,000 General Electric Capital Corp., 4.84%,
08/05/99................................ 19,905,889
15,000,000 General Electric Capital Corp., 4.80%,
09/14/99................................ 14,850,000
15,000,000 General Electric Capital Corp., 4.81%,
11/12/99................................ 14,731,442
25,000,000 International Lease Finance, 4.88%,
08/09/99................................ 24,867,833
25,000,000 Merrill Lynch & Co., Inc., 4.87%,
07/09/99................................ 24,972,944
20,000,000 Sigma Finance Co., 4.86%, 08/06/99...... 19,902,800
10,000,000 Sigma Finance Co., 4.93%, 08/25/99...... 9,924,681
--------------
161,590,162
--------------
FINANCIAL SERVICES--DIVERSIFIED--0.8%
25,000,000 Association Capital Corp., 4.93%,
09/01/99................................ 24,787,736
--------------
FOOD & BEVERAGES--3.5%
18,000,000 Campbell, 5.14%, 08/06/99............... 17,907,480
10,000,000 Campbell, 4.89%, 03/15/00............... 9,649,550
25,000,000 Coca-Cola, 4.765%, 07/15/99............. 24,953,783
25,000,000 Coca-Cola, 4.77%, 07/27/99.............. 24,913,875
25,000,000 Kellogg Co., 4.95%, 07/21/99............ 24,931,250
--------------
102,355,938
--------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- --------------
<C> <S> <C>
COMMERCIAL PAPER+ (CONTINUED)
FOOD PROCESSING--0.9%
$28,000,000 Archer-Daniels-Midland Co., 4.87%,
09/15/99................................ $ 27,712,129
--------------
FOREIGN GOV'T & RELATED ISSUES-- CANADA--0.7%
20,000,000 Canadian Wheat Board, 4.76%, 10/02/99... 19,701,178
--------------
INSURANCE--1.3%
15,000,000 American General, 4.79%, 08/20/99....... 14,900,208
25,000,000 American General, 0.00%, 08/26/99....... 24,808,667
--------------
39,708,875
--------------
MEDICAL CARE & PRODUCTS--0.9%
25,000,000 Glaxo-Wellcome Co., 4.80%, 07/22/99..... 24,930,000
--------------
MEDICAL PRODUCTS & SUPPLIES--2.5%
36,855,000 Abbott Laboratories, 4.90%, 07/14/99.... 36,789,787
15,000,000 Johnson & Johnson, 4.76%, 09/08/99...... 14,863,150
21,700,000 Schering Corp., 5.15%, 09/08/99......... 21,485,803
--------------
73,138,740
--------------
NON-BANK HOLDING COMPANIES--1.8%
26,915,000 USAA Capital Corp., 5.20%, 07/26/99..... 26,817,807
25,000,000 USAA-Capital Corp., 4.83%, 08/17/99..... 24,842,354
--------------
51,660,161
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
90
<PAGE>
BNY HAMILTON MONEY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- --------------
COMMERCIAL PAPER+ (CONTINUED)
<C> <S> <C>
OIL--1.7%
$50,000,000 Chevron, 4.95%, 07/20/99................ $ 49,869,375
--------------
PHARMACEUTICALS--2.1%
38,400,000 Pfizer, 4.95%, 07/14/99................. 38,331,360
25,000,000 Warner Lambert, 4.83%, 08/13/99......... 24,855,771
--------------
63,187,131
--------------
PHARMECEUTICALS, HEALTH CARE, COSMETIC--1.0%
30,000,000 Procter & Gamble Co., 4.97%, 08/09/99... 29,838,475
--------------
PIPELINE--NON-NATURAL GAS--0.6%
17,200,000 Colonial Pipeline Co., 5.00%,
08/06/99................................ 17,114,000
--------------
RETAIL--SPECIALTY STORES--0.8%
13,446,000 St. Michael Finance Ltd., 4.85%,
07/12/99................................ 13,426,074
11,000,000 St. Michael Finance Ltd., 4.81%,
07/13/99................................ 10,982,363
--------------
24,408,437
--------------
TECHNOLOGY INDUSTRIES--1.7%
10,000,000 Motorola Corp., 4.79%, 07/16/99......... 9,980,042
40,000,000 Motorola Corp., 5.00%, 08/10/99......... 39,777,778
--------------
49,757,820
--------------
TELECOMMUNICATIONS--3.0%
48,000,000 Ameritech Corp., 4.83%, 07/19/99........ 47,884,080
40,150,000 AT&T Corp., 4.79%, 07/27/99............. 40,011,103
--------------
87,895,183
--------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- --------------
<C> <S> <C>
COMMERCIAL PAPER+ (CONTINUED)
UTILITIES--ELECTRIC--1.2%
$35,000,000 National Rural Utilities Cooperative
Finance, 4.87%, 09/09/99................ $ 34,668,569
--------------
UTILITIES--TELECOMMUNICATIONS--1.4%
40,000,000 BellSouth Telecommunications, Inc.,
4.95%, 07/12/99......................... 39,939,500
--------------
TOTAL COMMERCIAL PAPER
(Cost $1,345,823,826)................... 1,345,823,826
--------------
</TABLE>
<TABLE>
<C> <S> <C>
CERTIFICATES OF DEPOSIT-- 13.3%
BANKS--DOMESTIC INSTITUTIONS--5.9%
15,000,000 American Express Centurion Bank, 4.903%,
04/03/00................................ 15,000,000
15,000,000 Chase Manhattan Bank, 5.00%, 09/08/99... 15,002,547
10,000,000 Chase Manhattan Bank, 5.365%,
05/22/00................................ 9,996,996
25,000,000 Harris Trust Bank of Chicago, 4.87%,
07/08/99................................ 25,000,000
5,000,000 Michigan National Bank, 4.94%,
09/15/99................................ 5,000,204
10,000,000 Michigan National Bank, 5.13%,
04/10/00................................ 9,997,377
10,000,000 Morgan (J.P.) & Co., Inc., 5.546%,
07/07/99................................ 9,999,904
10,000,000 Morgan Guaranty Trust, 5.00%,
12/10/99................................ 10,000,000
10,000,000 NationsBank, 5.21%, 09/24/99............ 10,000,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
91
<PAGE>
BNY HAMILTON MONEY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ------------
CERTIFICATES OF DEPOSIT (CONTINUED)
<C> <S> <C>
$ 10,000,000 NationsBank, 4.99%, 01/11/00............ $ 9,999,494
40,000,000 Old Kent Bank & Trust Company, 4.90%,
08/02/99................................ 39,825,778
15,000,000 Wilmington Trust Co., 5.05%, 01/14/00... 15,000,000
------------
174,822,300
------------
BANKING--1.9%
20,000,000 Fifth Third Bank, 4.84%, 07/19/99....... 20,000,000
15,000,000 Fifth Third Bank, 4.83%, 08/04/99....... 15,000,000
10,000,000 First Union National Bank, 5.56%,
06/02/00................................ 10,005,170
10,000,000 Regions Bank, 5.15%, 02/18/00........... 10,000,000
------------
55,005,170
------------
BANKS--FOREIGN INSTITUTIONS--5.5%
10,000,000 ABN Amro Bank, 5.045%, 02/14/99......... 9,998,831
15,000,000 Bank of Austria, 5.60%, 08/13/99........ 14,999,048
10,000,000 Bank of Montreal, 5.12%, 04/10/00....... 9,997,751
25,000,000 Bayerische Landesbank, 5.04%,
08/17/99................................ 25,000,000
10,000,000 Bayerische Landesbank, 5.19%,
02/29/00................................ 9,998,718
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ------------
<C> <S> <C>
CERTIFICATES OF DEPOSIT (CONTINUED)
$ 20,000,000 Bayerische Verinsbank, 4.907%,
05/15/00................................ $ 19,991,378
15,000,000 Commerzbank NY, 4.965%, 02/01/00........ 14,998,721
10,000,000 Rabobank Nederland NV NY, 5.65%,
07/08/99................................ 9,999,912
10,000,000 Rabobank Nederland NV NY, 5.45%,
06/05/00................................ 9,996,423
10,000,000 Toronto Dominion, 4.99%, 01/06/00....... 9,999,001
7,000,000 Toronto Dominion Bank NY, 4.295%,
03/06/00................................ 6,997,934
5,000,000 United Bank of Switzerland, 5.285%,
03/01/00................................ 4,999,839
15,000,000 United Bank Switzerland AG Stamford,
5.08%, 01/13/00......................... 15,006,229
------------
161,983,785
------------
TOTAL CERTIFICATES OF DEPOSIT
(Cost $391,811,255)..................... 391,811,255
------------
</TABLE>
<TABLE>
<C> <S> <C>
TIME DEPOSITS--10.0%
BANKS--DOMESTIC--2.0%
60,000,000 First National Bank of Chicago, 5.813%,
07/01/99................................ 60,000,000
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
92
<PAGE>
BNY HAMILTON MONEY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ------------
TIME DEPOSITS (CONTINUED)
<C> <S> <C>
BANKS--FOREIGN INSTITUTIONS--8.0%
$ 44,461,000 Bank of Canada, 4.75%, 07/01/99......... $ 44,461,000
60,000,000 CIBC/Oppenheimer,, 5.813%, 07/01/99..... 60,000,000
10,000,000 CIBC/Oppenheimer,, 5.10%, 04/12/00...... 9,996,225
60,000,000 Dresdner Bank AG, 5.625%, 07/01/99...... 60,000,000
60,000,000 WEST LB-TD, 5.875%, 07/01/99............ 60,000,000
------------
234,457,225
------------
TOTAL TIME DEPOSITS
(Cost $294,457,225)..................... 294,457,225
------------
</TABLE>
<TABLE>
<C> <S> <C>
UNITED STATES GOVERNMENT AGENCIES & OBLIGATIONS--9.4%
FEDERAL FARM CREDIT BANK--1.2%
27,000,000 4.91%, 08/06/99......................... 26,867,430
7,350,000 4.76%, 01/18/00......................... 7,341,717
------------
34,209,147
------------
FEDERAL HOME LOAN BANK--3.3%
10,000,000 5.54%+, 07/15/99........................ 9,999,762
30,000,000 4.88%, 09/2/99.......................... 29,743,800
9,575,000 5.83%+, 11/19/99........................ 9,622,885
10,000,000 4.95%+, 02/17/00........................ 9,996,614
10,000,000 4.95%+, 02/24/00........................ 9,992,175
6,970,000 5.03%, 02/25/00......................... 6,938,549
10,000,000 0.00%+, 04/28/00........................ 9,994,362
10,000,000 5.15%+, 05/19/00........................ 9,991,028
------------
96,279,175
------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ------------
<C> <S> <C>
UNITED STATES GOVERNMENT AGENCIES & OBLIGATIONS
(CONTINUED)
FEDERAL HOME LOAN MORTGAGE CORP.--0.6%
$ 18,492,000 4.72%, 07/12/99......................... $ 18,465,302
------------
FEDERAL NATIONAL MORTGAGE ASSOC.-- 3.4%
25,000,000 4.70%, 07/22/99......................... 24,931,458
30,000,000 4.74%, 08/11/99......................... 29,838,050
4,000,000 5.81%, 10/01/99......................... 4,008,971
10,000,000 4.81%, 10/05/99......................... 9,997,447
10,000,000 5.10%, 12/10/99......................... 9,773,200
10,000,000 5.07%, 01/19/00......................... 9,715,517
10,000,000 5.05%, 05/12/00......................... 9,993,307
------------
98,257,950
------------
UNITED STATES TREASURY NOTES--0.9%
5,000,000 5.63%, 10/31/99......................... 5,015,931
5,000,000 5.88%, 11/15/99......................... 5,019,174
5,000,000 5.63%, 12/31/99......................... 5,022,594
5,000,000 5.38%, 01/31/00......................... 5,019,512
5,000,000 5.50%, 05/31/00......................... 5,024,097
------------
25,101,308
------------
TOTAL UNITED STATES GOVERNMENT AGENCIES
& OBLIGATIONS
(Cost $272,312,882)..................... 272,312,882
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
93
<PAGE>
BNY HAMILTON MONEY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- --------------
<C> <S> <C>
CORPORATE BONDS--4.1%
ASSET BACKED SECURITIES--TRADE & LEASE RECEIVABLES--0.9%
$15,000,000 Ford Credit Auto Owner, 5.11%,
05/15/00................................ $ 15,000,000
10,178,510 Ford Credit Auto Owner TR 99-A A2,
5.089%, 01/18/00........................ 10,178,510
2,315,023 Newcourt Equipment Trust Securities,
5.077%, 11/20/99........................ 2,315,015
--------------
27,493,525
--------------
BANKS--DOMESTIC INSTITUTIONS--2.1%
8,000,000 Chase Manhattan Bank, 5.875%,
08/04/99................................ 8,004,584
10,000,000 First National Bank of Chicago, 5.09%,
04/20/00................................ 9,995,344
10,000,000 Lasalle National Bank, 4.97%,
08/12/99................................ 10,000,000
10,000,000 Morgan Guaranty Trust, 5.09%,
09/27/99................................ 9,998,830
8,000,000 Norwest Financial Inc., 6.68%,
09/15/99................................ 8,022,421
15,000,000 Wachovia Bank, 5.00%, 09/01/99.......... 15,000,000
--------------
61,021,179
--------------
FINANCE COMPANIES--NON-CAPTIVE AND INDEPENDENT--0.2%
7,291,000 Associates Corp. of North America,
7.25%, 09/01/99......................... 7,309,917
--------------
FINANCIAL SERVICES--0.4%
10,575,000 Wells Fargo Co., 5.55%, 08/31/99........ 10,581,983
--------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- --------------
<C> <S> <C>
CORPORATE BONDS (CONTINUED)
FOOD PROCESSING--0.5%
$ 5,000,000 Sara Lee Corp., 6.70%, 09/09/99......... $ 5,009,607
10,000,000 Sara Lee Corp., 7.75%, 02/03/00......... 10,148,020
--------------
15,157,627
--------------
TOTAL CORPORATE BONDS
(Cost $121,564,231)..................... 121,564,231
--------------
FLOATING RATE NOTES+--4.4%
BANK HOLDING COMPANIES--3.4%
15,000,000 Associates Corp. of North America,
4.90%, payable monthly, interest rate
resets monthly, next rate reset date
7/20/99, final maturity date 3/20/00.... 14,992,536
15,000,000 Morgan (J.P.) & Co., Inc., 4.93%,
payable monthly, interest rate resets
monthly, next rate reset date 7/6/99,
final maturity date 7/6/00.............. 14,997,405
10,000,000 Morgan (J.P.) & Co., Inc., 4.97%,
payable monthly, interest rate resets
monthly, next interest rate reset date
7/19/99, final maturity date 5/18/00.... 9,998,479
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
94
<PAGE>
BNY HAMILTON MONEY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ----------- --------------
FLOATING RATE NOTES+ (CONTINUED)
<C> <S> <C>
$20,000,000 Northern Trust Co., 4.84%, payable
monthly, interest rate resets monthly,
next interest reset date 7/8/99, final
maturity date 9/8/99.................... $ 19,997,732
20,000,000 US National Bank of Minnesota, 4.88%,
payable monthly, interest rate resets
monthly, next interest rate reset date
7/21/99, final maturity date 4/19/00.... 19,988,914
20,000,000 Wachovia Bank NA, 5.03%, payable
monthly, interest rate resets monthly,
next interest rate reset date 7/23/99,
final maturity date 10/25/99............ 20,001,684
--------------
99,976,750
--------------
BANK NOTE--0.3%
10,000,000 First Union National Bank, 4.93%,
payable monthly, interest rate resets
monthly, next rate reset date 7/8/99,
final maturity date 6/8/00.............. 10,000,000
--------------
BROKERAGE SERVICES--0.7%
20,000,000 Merrill Lynch & Co., Inc., 4.90%,
payable monthly, interest rate resets
monthly, next interest rate reset date
7/13/99, final maturity date 8/13/99.... 19,999,764
--------------
TOTAL FLOATING RATE NOTES
(Cost $129,976,514)
........... 129,976,514
--------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ --------------
<C> <S> <C>
REPURCHASE AGREEMENTS-- 13.0%
REPURCHASE AGREEMENTS WITH BARCLAYS CAPITAL, INC.--4.8%
$140,000,000 4.95% due 7/1/99, repurchase price
$140,019,250 (Collateral--Various United
States Government Agency Discount Notes
& Bonds,0.00%-9.30%, 7/2/99-6/15/09;
aggregate market value plus accrued
interest $142,800,384).................. $ 140,000,000
--------------
REPURCHASE AGREEMENT WITH DEUTSCHE BANK SECURITIES
INC.--3.4%
100,000,000 5.02% due 7/1/99, repurchase price
$100,013,944 (Collateral--FHLB Disct.
Note, 6.243%, 6/7/06; IADB Bond, 6.95%,
8/1/26; MCDB Bond, 5.9%, 4/1/02;
aggregate market value plus accrued
interest $102,000,716).................. 100,000,000
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
95
<PAGE>
BNY HAMILTON MONEY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ --------------
REPURCHASE AGREEMENTS (CONTINUED)
<C> <S> <C>
REPURCHASE AGREEMENT WITH MORGAN STANLEY DEAN
WITTER--4.8%
$140,000,000 4.95% due 7/1/99, repurchase price
$140,019,250 (Collateral--Various United
States Government Agency Discount Notes
& Bonds, 0.00%-8.115%, 7/2/99-5/13/14;
aggregate market value plus accrued
interest $143,862,711).................. $ 140,000,000
--------------
TOTAL REPURCHASE AGREEMENTS
(Cost $380,000,000)..................... 380,000,000
--------------
TOTAL INVESTMENTS
(Cost $2,935,945,933)(a)-- 100.1%....... 2,935,945,933
Other assets less liabilities--(0.1)%... (3,211,261)
--------------
NET ASSETS--100.0%...................... $2,932,734,672
--------------
--------------
</TABLE>
+ REPRESENTS YIELD AT TIME OF PURCHASE FOR COMMERCIAL PAPER, DISCOUNTED RATE
AT TIME OF PURCHASE FOR UNITED STATES GOVERNMENT AGENCIES & OBLIGATIONS,
AND INTEREST RATE IN EFFECT AT JUNE 30, 1999 FOR FLOATING RATE NOTES.
FHLB FEDERAL HOME LOAN BANK.
IADB INTERAMERICAN DEVELOPMENT BANK.
MCDB FEDERAL HOME LOAN MORTGAGE CORP. DEBENTURE BOND
UST UNITED STATES TREASURY.
(a) THE COST STATED ALSO APPROXIMATES THE AGGREGATE COST FOR FEDERAL INCOME TAX
PURPOSES.
SEE NOTES TO FINANCIAL STATEMENTS.
96
<PAGE>
BNY HAMILTON MONEY FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at value, including repurchase agreements of
$380,000,000 (Cost $2,935,945,933)...................... $2,935,945,933
Cash...................................................... 3,166
Receivables:
Investments sold........................................ 784,081,000
Capital stock sold...................................... 99,479,875
Interest................................................ 9,098,831
Other assets.............................................. 358,482
--------------
TOTAL ASSETS.......................................... 3,828,967,287
--------------
LIABILITIES:
Payables:
Investments purchased................................... 743,216,903
Capital stock redeemed.................................. 140,467,667
Dividends............................................... 11,266,021
Services provided by The Bank of New York and
Administrator......................................... 887,093
Accrued expenses and other liabilities.................... 394,931
--------------
TOTAL LIABILITIES..................................... 896,232,615
--------------
NET ASSETS:................................................. $2,932,734,672
--------------
--------------
SOURCES OF NET ASSETS:
Capital stock @ par....................................... $ 2,932,729
Capital surplus........................................... 2,929,795,890
Accumulated net realized gain on investments.............. 6,053
--------------
NET ASSETS.................................................. $2,932,734,672
--------------
--------------
HAMILTON SHARES:
Net assets................................................ $1,492,901,400
--------------
--------------
Shares outstanding........................................ 1,492,897,873
--------------
--------------
Net asset value, offering price and repurchase price per
share................................................... $ 1.00
--------------
--------------
HAMILTON PREMIER SHARES:
Net assets................................................ $ 776,579,716
--------------
--------------
Shares outstanding........................................ 776,577,405
--------------
--------------
Net asset value, offering price and repurchase price per
share................................................... $ 1.00
--------------
--------------
HAMILTON CLASSIC SHARES:
Net assets................................................ $ 663,253,556
--------------
--------------
Shares outstanding........................................ 663,253,341
--------------
--------------
Net asset value, offering price and repurchase price per
share................................................... $ 1.00
--------------
--------------
Hamilton Shares authorized @ $.001 par value................ 3,000,000,000
Hamilton Premier Shares authorized @ $.001 par value........ 3,000,000,000
Hamilton Classic Shares authorized @ $.001 par value........ 3,000,000,000
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest.................................................. $ 69,624,438
------------
EXPENSES:
Advisory.................................................. 1,405,401
Administration............................................ 1,405,401
12b-1 fee: Hamilton Classic Shares........................ 635,630
Servicing fee: Hamilton Premier Shares.................... 916,350
Hamilton Classic Shares..................... 635,630
Custodian................................................. 130,882
Registration and filings.................................. 127,178
Reports to shareholders................................... 112,263
Transfer agent............................................ 70,230
Audit..................................................... 35,424
Legal..................................................... 32,226
Accounting services....................................... 29,739
Cash management........................................... 26,428
Insurance................................................. 13,749
Directors................................................. 7,808
Other..................................................... 47,278
------------
TOTAL EXPENSES.......................................... 5,631,617
Earnings credit adjustment (Note 3)....................... (15,750)
------------
NET EXPENSES............................................ 5,615,867
------------
NET INVESTMENT INCOME................................... $ 64,008,571
Net realized gain on investments.......................... 6,053
------------
Net increase in net assets resulting
from operations......................................... $ 64,014,624
------------
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
97
<PAGE>
BNY HAMILTON MONEY FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1999 DECEMBER 31,
(UNAUDITED) 1998
---------------- ----------------
<S> <C> <C>
OPERATIONS:
Net investment income....................................................... $ 64,008,571 $ 103,213,492
Net realized gain on investments............................................ 6,053 --
---------------- ----------------
Net increase in net assets resulting from operations........................ 64,014,624 103,213,492
---------------- ----------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income: Hamilton Shares....................... (36,969,657) (58,674,160)
Hamilton Premier Shares............. (16,387,103) (43,650,908)
Hamilton Classic Shares............. (10,650,243) (903,654)
---------------- ----------------
(64,007,003) (103,228,722)
---------------- ----------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Hamilton Shares........................... 2,570,456,432 3,662,245,203
Hamilton Premier Shares................... 3,669,462,945 9,474,354,796
Hamilton Classic Shares................... 3,694,280,963 76,263,435
Proceeds from shares issued on reinvestment
of dividends: Hamilton Shares............................................. 4,799,198 6,615,671
Hamilton Premier Shares.................................. 9,553,245 27,238,815
Hamilton Classic Shares.................................. 8,427,525 775,787
Cost of capital stock repurchased: Hamilton Shares.......................... (2,521,883,867) (3,292,905,293)
Hamilton Premier Shares.................. (3,967,084,477) (9,125,281,782)
Hamilton Classic Shares.................. (3,059,449,666) (73,769,087)
---------------- ----------------
Increase in net assets resulting from capital stock transactions.......... 408,562,298 755,537,545
---------------- ----------------
INCREASE IN NET ASSETS.................................................. 408,569,919 755,522,315
NET ASSETS:
Beginning of period......................................................... 2,524,164,753 1,768,642,438
---------------- ----------------
End of period............................................................... $ 2,932,734,672 $ 2,524,164,753
---------------- ----------------
---------------- ----------------
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold: Hamilton Shares................................................ 2,570,456,432 3,662,245,203
Hamilton Premier Shares..................................... 3,669,462,945 9,474,354,796
Hamilton Classic Shares..................................... 3,694,280,963 76,263,435
Shares issued on reinvestment of dividends: Hamilton Shares................. 4,799,198 6,615,671
Hamilton Premier Shares.......... 9,553,245 27,238,815
Hamilton Classic Shares.......... 8,427,525 775,787
Shares repurchased: Hamilton Shares......................................... (2,521,883,867) (3,292,905,293)
Hamilton Premier Shares............................... (3,967,084,477) (9,125,281,782)
Hamilton Classic Shares............................... (3,059,449,666) (73,769,087)
---------------- ----------------
Net increase.............................................................. 408,562,298 755,537,545
Shares outstanding, beginning of period..................................... 2,524,166,321 1,768,628,776
---------------- ----------------
Shares outstanding, end of period........................................... 2,932,728,619 2,524,166,321
---------------- ----------------
---------------- ----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
98
<PAGE>
BNY HAMILTON MONEY FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
HAMILTON SHARES
-----------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 1999 -------------------------------------------------------------
(UNAUDITED) 1998 1997 1996 1995 1994
----------------- ----------- ----------- --------- --------- ---------
<S> <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
----------------- ----------- ----------- --------- --------- ---------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 0.024 0.053 0.053 0.052 0.057 0.040
----------------- ----------- ----------- --------- --------- ---------
DIVIDENDS
Dividends from net
investment income...... (0.024) (0.053) (0.053) (0.052) (0.057) (0.040)
----------------- ----------- ----------- --------- --------- ---------
Net asset value at end of
period................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------------- ----------- ----------- --------- --------- ---------
----------------- ----------- ----------- --------- --------- ---------
TOTAL RETURN:............ 2.36%* 5.41% 5.47% 5.30% 5.84% 4.02%
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of
period (000's
omitted)............... $1,492,901 $ 1,439,525 $ 1,063,579 $ 609,424 $ 604,053 $ 235,220
Ratio to average net
assets of:
Expenses net of waiver
from The Bank of New
York................. 0.24%** 0.26% 0.25% 0.27% 0.26% 0.30%
Expenses, prior to
waiver from The Bank
of New York.......... 0.24%** 0.26% 0.25% 0.27% 0.26% 0.32%
Net investment income,
net of waiver from
The Bank of New
York................. 4.71%** 5.25% 5.34% 5.17% 5.67% 3.92%
</TABLE>
* NOT ANNUALIZED.
** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
99
<PAGE>
BNY HAMILTON MONEY FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
HAMILTON PREMIER SHARES
----------------------------------------------------------------------------------------------------
FOR THE PERIOD
SIX MONTHS ENDED YEAR ENDED DECEMBER 31, AUGUST 15, 1994*
JUNE 30, 1999 ----------------------------------------------------------- THROUGH
(UNAUDITED) 1998 1997 1996 1995 DECEMBER 31, 1994
----------------- -------------- ------------ ------------ ------------ ------------------
<S> <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
-------- -------------- ------------ ------------ ------------ --------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 0.023 0.050 0.051 0.049 0.054 0.017
-------- -------------- ------------ ------------ ------------ --------
DIVIDENDS
Dividends from net
investment income...... (0.023) (0.050) (0.051) (0.049) (0.054) (0.017)
-------- -------------- ------------ ------------ ------------ --------
Net asset value at end of
period................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------------- ------------ ------------ ------------ --------
-------- -------------- ------------ ------------ ------------ --------
TOTAL RETURN:............ 2.23%** 5.14% 5.19% 5.03% 5.54% 1.69%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of
period (000's
omitted)............... $776,580 $ 1,064,645 $ 688,339 $ 463,759 $ 340,163 $107,799
Ratio to average net
assets of:
Expenses............... 0.49%*** 0.51% 0.51% 0.53% 0.54% 0.61%***
Net investment
income............... 4.47%*** 5.01% 5.09% 4.91% 5.40% 4.40%***
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
** NOT ANNUALIZED.
*** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
100
<PAGE>
BNY HAMILTON MONEY FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
HAMILTON CLASSIC SHARES
--------------------------------------------------------------------------------
FOR THE PERIOD
SIX MONTHS ENDED YEAR ENDED DECEMBER 31, DECEMBER 4, 1995*
JUNE 30, 1999 --------------------------------------- THROUGH
(UNAUDITED) 1998 1997 1996 DECEMBER 31, 1995
----------------- ----------- ----------- ----------- ------------------
<S> <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
-------- ----------- ----------- ----------- ------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................... 0.021 0.047 0.047 0.046 0.004
-------- ----------- ----------- ----------- ------
DIVIDENDS
Dividends from net investment income.... (0.021) (0.047) (0.047) (0.046) (0.004)
-------- ----------- ----------- ----------- ------
Net asset value at end of period........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- ----------- ----------- ----------- ------
-------- ----------- ----------- ----------- ------
TOTAL RETURN:........................... 2.10%** 4.81% 4.80% 4.73% 0.40%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of period (000's
omitted).............................. $663,254 $ 19,995 $ 16,725 $ 13,478 $3,098
Ratio to average net assets of:
Expenses.............................. 0.75%*** 0.83% 0.88% 0.82% 0.76%***
Net investment income................. 4.19%*** 4.70% 4.71% 4.67% 5.18%***
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
** NOT ANNUALIZED.
*** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
101
<PAGE>
BNY HAMILTON TREASURY MONEY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ------------
<C> <S> <C>
UNITED STATES GOVERNMENT OBLIGATIONS--19.6%
UNITED STATES TREASURY BILLS+--3.1%
$ 5,000,000 4.48%, 11/12/99......................... $ 4,915,785
10,000,000 4.53%, 12/09/99......................... 9,799,868
10,000,000 4.62%, 01/06/00......................... 9,756,400
------------
24,472,053
------------
UNITED STATES TREASURY NOTES--16.5%
10,000,000 5.88%, 07/31/99......................... 10,002,984
5,000,000 6.00%, 08/15/99......................... 5,005,981
5,000,000 5.88%, 08/31/99......................... 5,008,525
5,000,000 5.75%, 09/30/99......................... 5,013,537
10,000,000 5.63%, 10/31/99......................... 10,037,176
10,000,000 5.88%, 11/15/99......................... 10,038,348
10,000,000 5.63%, 12/31/99......................... 10,045,189
15,000,000 5.38%, 01/31/00......................... 15,044,013
10,000,000 5.88%, 02/05/00......................... 10,069,285
5,000,000 5.50%, 02/29/00......................... 5,018,264
10,000,000 5.50%, 03/31/00......................... 10,028,180
10,000,000 5.50%, 04/15/00......................... 10,048,249
10,000,000 5.63%, 04/30/00......................... 10,030,045
15,000,000 5.50%, 05/31/00......................... 15,066,590
------------
130,456,366
------------
TOTAL UNITED STATES GOVERNMENT
OBLIGATIONS
(Cost $154,928,419)..................... 154,928,419
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ REPURCHASE AGREEMENTS-- 80.5% ------------
<C> <S> <C>
REPURCHASE AGREEMENT WITH BARCLAYS CAPITAL,
INC.--16.4%
$130,000,000 4.80%, due 7/1/99, repurchase price
$130,017,333 (Collateral-- UST Note
7.00%, 7/15/06; UST Bond 8.125%,
8/15/19; aggregate market value plus
accrued interest $132,600,352).......... $130,000,000
------------
REPURCHASE AGREEMENT WITH DEUTSCHE BANK SECURITIES
INC.--6.3%
50,000,000 4.90%, due 7/1/99, repurchase price
50,006,806 (Collateral-- UST Note,
6.125%, 8/15/07; UST Bond, 7.50%,
11/15/16; aggregate market value plus
accrued interest $51,000,077)........... 50,000,000
------------
REPURCHASE AGREEMENT WITH GOLDMAN, SACHS & CO.--20.5%
162,048,000 4.20%, due 7/1/99, repurchase price
$162,066,906 (Collateral-- UST Bond,
6.375%, 8/15/27; market value plus
accrued interest $165,289,868).......... 162,048,000
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
102
<PAGE>
BNY HAMILTON TREASURY MONEY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ------------
REPURCHASE AGREEMENTS (CONTINUED)
<C> <S> <C>
REPURCHASE AGREEMENT WITH J.P. MORGAN SECURITIES,
INC.--20.9%
$165,000,000 4.80%, due 7/1/99 repurchase price
$165,022,000 (Collateral-- UST Notes,
5.625%-6.00%, 8/15/00-5/15/01; UST
Bonds, 5.25%-9.375%, 2/15/06-2/15/29;
aggregate market value plus accrued
interest $168,300,518).................. $165,000,000
------------
REPURCHASE AGREEMENT WITH MORGAN STANLEY DEAN
WITTER--16.4%
130,000,000 4.80%, due 7/1/99 repurchase price
$130,017,333 (Collateral-- UST Notes,
5.375%-7.750%, 12/31/99-1/31/00;
aggregate market value plus accrued
interest $133,253,312).................. 130,000,000
------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE
- ------------ ------------
<C> <S> <C>
REPURCHASE AGREEMENTS (CONTINUED)
TOTAL REPURCHASE AGREEMENTS
(Cost $637,048,000)..................... $637,048,000
------------
</TABLE>
<TABLE>
<C> <S> <C>
TOTAL INVESTMENTS--
(Cost $791,976,419)(a)-- 100.1%......... 791,976,419
Other assets less
liabilities--(0.1)%..................... (817,634)
------------
NET ASSETS--100.0%...................... $791,158,785
------------
------------
</TABLE>
+ COUPON RATE REPRESENTS DISCOUNTED RATE AT TIME OF PURCHASE FOR UNITED
STATES TREASURY BILLS.
UST UNITED STATES TREASURY.
(a) THE COST STATED ALSO APPROXIMATES THE AGGREGATE COST FOR FEDERAL INCOME TAX
PURPOSES.
SEE NOTES TO FINANCIAL STATEMENTS.
103
<PAGE>
BNY HAMILTON TREASURY MONEY FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at value, including repurchase agreements of
$637,048,000 (Cost $791,976,419)........................ $ 791,976,419
Cash...................................................... 704
Receivables:
Investments sold........................................ 550,208,000
Capital stock sold...................................... 96,950,074
Interest receivable..................................... 1,849,480
Deferred organization costs and other assets.............. 567,412
--------------
TOTAL ASSETS.......................................... 1,441,552,089
--------------
LIABILITIES:
Payables:
Investments purchased................................... 637,048,000
Capital stock redeemed.................................. 10,614,433
Dividends............................................... 2,422,254
Services provided by The Bank of New York and
Administrator........................................... 246,866
Accrued expenses and other liabilities.................... 61,751
--------------
TOTAL LIABILITIES..................................... 650,393,304
--------------
NET ASSETS:................................................. $ 791,158,785
--------------
--------------
SOURCES OF NET ASSETS:
Capital stock @ par....................................... $ 791,158
Capital surplus........................................... 790,367,266
Accumulated net realized gain on investments.............. 361
--------------
NET ASSETS.................................................. $ 791,158,785
--------------
--------------
HAMILTON SHARES:
Net assets................................................ $ 223,803,002
--------------
--------------
Shares outstanding........................................ 223,802,503
--------------
--------------
Net asset value, offering price and repurchase price per
share................................................... $ 1.00
--------------
--------------
HAMILTON PREMIER SHARES:
Net assets................................................ $ 362,153,334
--------------
--------------
Shares outstanding........................................ 362,153,188
--------------
--------------
Net asset value, offering price and repurchase price per
share................................................... $ 1.00
--------------
--------------
HAMILTON CLASSIC SHARES:
Net assets................................................ $ 205,202,449
--------------
--------------
Shares outstanding........................................ 205,202,449
--------------
--------------
Net asset value, offering price and repurchase price per
share................................................... $ 1.00
--------------
--------------
Hamilton Shares authorized @ $.001 par value................ 2,000,000,000
Hamilton Premier Shares authorized @ $.001 par value........ 2,000,000,000
Hamilton Classic Shares authorized @ $.001 par value........ 2,000,000,000
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest.................................................. $16,866,008
-----------
EXPENSES:
Advisory.................................................. 351,507
Administration............................................ 351,507
12b-1 fee: Hamilton Classic Shares........................ 39,602
Servicing fee--Hamilton Premier Shares.................... 583,125
Hamilton Classic Shares...................... 39,602
Registration and filings.................................. 77,720
Custodian................................................. 57,385
Accounting services....................................... 29,743
Reports to shareholders................................... 22,284
Transfer agent............................................ 20,917
Cash management........................................... 8,963
Audit..................................................... 8,467
Directors................................................. 7,885
Legal..................................................... 6,649
Organization.............................................. 3,205
Insurance................................................. 2,384
Other..................................................... 9,583
-----------
TOTAL EXPENSES.......................................... 1,620,528
Earnings credit adjustment (Note 3)....................... (2,007)
-----------
NET EXPENSES............................................ 1,618,521
-----------
NET INVESTMENT INCOME................................... 15,247,487
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
104
<PAGE>
BNY HAMILTON TREASURY MONEY FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR
SIX MONTHS ENDED ENDED
JUNE 30, 1999 DECEMBER 31,
(UNAUDITED) 1998
---------------- --------------
<S> <C> <C>
OPERATIONS:
Net investment income............................................... $ 15,247,487 $ 24,992,057
Net realized gain on investments.................................... 0 1,044
---------------- --------------
Net increase in net assets resulting from operations.............. 15,247,487 24,993,101
---------------- --------------
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income: Hamilton Shares............... (4,632,394) (8,862,413)
Hamilton Premier Shares.... (9,985,007) (16,129,644)
Hamilton Classic Shares.... (629,777)
---------------- --------------
(15,247,178) (24,992,057)
---------------- --------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock sold: Hamilton Shares................... 582,483,900 758,097,192
Hamilton Premier Shares.......... 1,678,767,594 2,984,119,812
Hamilton Classic Shares.......... 397,454,237
Proceeds from shares issued on reinvestment
of dividends: Hamilton Shares..................................... 2,480,644 3,882,860
Hamilton Premier Shares......................... 5,624,423 7,344,494
Hamilton Classic Shares......................... 0
Cost of capital stock repurchased: Hamilton Shares.................. (562,524,804) (671,336,485)
Hamilton Premier Shares......... (1,842,731,104) (2,654,867,480)
Hamilton Classic Shares......... (192,251,788)
---------------- --------------
Increase in net assets resulting from capital stock
transactions.................................................... 69,303,102 427,240,393
---------------- --------------
INCREASE IN NET ASSETS.......................................... 69,303,411 427,241,437
NET ASSETS:
Beginning of period................................................. 721,855,374 294,613,937
---------------- --------------
End of period....................................................... $ 791,158,785 $ 721,855,374
---------------- --------------
---------------- --------------
CHANGE IN CAPITAL STOCK OUTSTANDING:
Shares sold: Hamilton Shares........................................ 582,483,615 758,097,192
Hamilton Premier Shares............................. 1,678,767,594 2,984,119,812
Hamilton Classic Shares............................. 397,454,237
Shares issued on reinvestment of dividends: Hamilton Shares......... 2,480,644 3,882,860
Hamilton Premier
Shares........................ 5,624,423 7,344,494
Hamilton Classic
Shares........................ 0
Shares repurchased: Hamilton Shares................................. (562,524,804) (671,336,485)
Hamilton Premier Shares...................... (1,842,730,794) (2,654,867,480)
Hamilton Classic Shares...................... (192,251,788)
---------------- --------------
Net increase...................................................... 69,303,127 427,240,393
Shares outstanding, beginning of period............................. 721,855,013 294,614,620
---------------- --------------
Shares outstanding, end of period................................... 791,158,140 721,855,013
---------------- --------------
---------------- --------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
105
<PAGE>
BNY HAMILTON TREASURY MONEY FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
HAMILTON SHARES
-------------------------------------------------
SIX MONTHS FOR THE
ENDED YEAR PERIOD
JUNE 30, ENDED APRIL 1, 1997*
1999 DECEMBER 31, THROUGH
(UNAUDITED) 1998 DECEMBER 31, 1997
------------ ------------- ------------------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value at beginning of period................................ $ 1.00 $ 1.00 $ 1.00
------------ ------------- --------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................................................. 0.024 0.051 0.040
------------ ------------- --------
DIVIDENDS
Dividends from net investment income.................................. (0.024) (0.051) (0.040)
------------ ------------- --------
Net asset value at end of period...................................... $ 1.00 $ 1.00 $ 1.00
------------ ------------- --------
------------ ------------- --------
TOTAL RETURN:......................................................... 2.26%** 5.25% 4.02%**
RATIOS/SUPPLEMENTAL
DATA:
Net assets at end of period (000's omitted)........................... $223,803 $201,363 $110,719
Ratio to average net assets of:
Expenses, net of waiver from The Bank of New York................... 0.27%*** 0.27% 0.25%***
Expenses, prior to waiver from The Bank of New York................. 0.27%*** 0.28% 0.33%***
Net investment income, net of waiver from The Bank of New York...... 4.52%*** 5.09% 5.29%***
<CAPTION>
HAMILTON PREMIER SHARES
-------------------------------------------------
SIX MONTHS FOR THE
ENDED YEAR PERIOD
JUNE 30, ENDED APRIL 1, 1997*
1999 DECEMBER 31, THROUGH
(UNAUDITED) 1998 DECEMBER 31, 1997
------------ ------------- ------------------
<S> <C>
PER SHARE DATA:
Net asset value at beginning of period................................ $ 1.00 $ 1.00 $ 1.00
------------ ------------- --------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................................................. 0.023 0.049 0.038
------------ ------------- --------
DIVIDENDS
Dividends from net investment income.................................. (0.023) (0.049) (0.038)
------------ ------------- --------
Net asset value at end of period...................................... $ 1.00 $ 1.00 $ 1.00
------------ ------------- --------
------------ ------------- --------
TOTAL RETURN:......................................................... 2.15%** 4.99% 3.83%**
RATIOS/SUPPLEMENTAL
DATA:
Net assets at end of period (000's omitted)........................... $362,153 $520,492 $183,895
Ratio to average net assets of:
Expenses, net of waiver from The Bank of New York................... 0.52%*** 0.52% 0.50%***
Expenses, prior to waiver from The Bank of New York................. 0.52%*** 0.53% 0.56%***
Net investment income, net of waiver from The Bank of New York...... 4.28%*** 4.82% 5.06%***
<CAPTION>
HAMILTON CLASSIC
SHARES
--------------------
FOR THE PERIOD
APRIL 30, 1999*
THROUGH
JUNE 30, 1999
(UNAUDITED)
--------------------
PER SHARE DATA:
Net asset value at beginning of period................................ $ 1.00
--------
INCOME FROM INVESTMENT OPERATIONS
Net investment income................................................. 0.007
--------
DIVIDENDS
Dividends from net investment income.................................. (0.007)
--------
Net asset value at end of period...................................... $ 1.00
--------
--------
TOTAL RETURN:......................................................... 0.67%**
RATIOS/SUPPLEMENTAL
DATA:
Net assets at end of period (000's omitted)........................... $205,203
Ratio to average net assets of:
Expenses, net of waiver from The Bank of New York................... 0.77%***
Expenses, prior to waiver from The Bank of New York................. 0.77%***
Net investment income, net of waiver from The Bank of New York...... 3.98%***
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS FOR THE RESPECTIVE CLASS OF SHARES.
** NOT ANNUALIZED.
*** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
106
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. ORGANIZATION AND BUSINESS
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 ten series: BNY Hamilton Equity Income Fund (the "Equity Income
Fund"), BNY Hamilton Large Cap Growth Fund (the "Large Cap Growth Fund"), BNY
Hamilton Small Cap Growth Fund (the "Small Cap Growth Fund"), BNY Hamilton
International Equity Fund (the "International Equity Fund"), BNY Hamilton
Intermediate Government Fund (the "Intermediate Government Fund"), BNY Hamilton
Intermediate Investment Grade Fund (the "Intermediate Investment Grade Fund"),
BNY Hamilton Intermediate New York Tax-Exempt Fund (the "Intermediate New York
Tax-Exempt Fund"), BNY Hamilton Intermediate Tax-Exempt Fund (the "Intermediate
Tax-Exempt Fund"), BNY Hamilton Money Fund (the "Money Fund"), and BNY Hamilton
Treasury Money Fund (the "Treasury Money Fund") (individually, a "Fund" and
collectively, the "Funds"). All the Funds (except the Money Fund and Treasury
Money Fund) consist of two classes of shares: Institutional Shares and Investor
Shares. The Money Fund and Treasury Money Fund consist of three classes of
shares: Hamilton Shares, Hamilton Premier Shares, and Hamilton Classic Shares.
Investment income, expenses (other than those specific to the class of
shares), and realized and unrealized gains and losses on investments are
allocated to the separate classes of shares based upon their relative net asset
value on the date income is earned or expensed and realized and unrealized gains
and losses are incurred.
2. SIGNIFICANT ACCOUNTING POLICIES
(A) SECURITY VALUATIONS
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 at the close of the primary exchange. Unlisted securities
traded only on the over-the-counter market are valued at the average of the
quoted bid and the asked prices on 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.
The determination of the value of certain portfolio debt securities, other
than temporary investments in short-term securities, 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.
Securities included in the Money Fund and Treasury Money Fund, and short-term
securities with a remaining maturity of 60 days or less in all other Funds are
valued at amortized cost which approximates fair value. This method values a
security at its cost at the time of purchase and thereafter assumes a
107
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
constant rate of amortization to maturity of any discount or premium.
Securities for which market quotations are not readily available, including
investments that are subject to limitations as to their sale (such as certain
restricted securities and illiquid securities), are valued at fair value as
determined in good faith by the Board of Directors. In determining fair value,
consideration is given to cost, operating and other financial data.
(B) CURRENCY TRANSLATION
Assets and liabilities denominated in foreign currencies are translated into
U.S. dollars at the mean of the bid and asked price of respective exchange rate
on the last day of the period. Purchases and sales of investments denominated in
foreign currencies are translated at the exchange rate on the date of the
transaction.
Foreign exchange gain or loss resulting from the sale of an investment,
holding of a foreign currency, expiration of a foreign currency exchange
contract, difference in exchange rates between the trade date and settlement
date of an investment purchased or sold, and the difference between dividends
actually received compared to the amount shown in a Fund's accounting records on
the date of receipt are shown as net realized gains or losses in the respective
Fund's statement of operations.
Foreign exchange gain or loss on assets and liabilities other than investments
currently shown on the respective Fund's statement of assets and liabilities are
shown as unrealized appreciation (depreciation) on foreign currency
transactions.
(C) REPURCHASE AGREEMENTS
A Fund's custodian or designated sub-custodians, as the case may be for
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, a Fund has 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
agreement, realization and/or retention of the collateral may be subject to
legal proceedings.
(D) WRITTEN OPTIONS AND PURCHASED OPTIONS
All Funds (except the Money Fund and the Treasury Money Fund) may enter into
an option contracts 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 a 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 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 Fund will be treated as
a short term capital gain. Likewise, premiums paid for purchased put options
that expire
108
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
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, a Fund does not have control over exercising of
such options. As a result, that Fund bears unlimited market risk of favorable
changes in the value of the call option's underlying securities. The Fund also
bears unlimited market risk in the value of the written call option itself.
If an option which a Fund has purchased expires on its stipulated expiration
date, it realizes a loss in the amount of the cost of the option. If it 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
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 a Fund exercises a call option, the cost of the
security which it purchases upon exercise will be increased by the premium
originally paid.
(E) FEDERAL INCOME TAXES
Each Fund is created 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.
(F) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
The Intermediate Government Fund, the Intermediate Investment Grade Fund, the
Intermediate New York Tax-Exempt Fund, the Intermediate Tax-Exempt Fund, the
Money Fund and the Treasury Money Fund declare dividends daily and pay dividends
monthly. The Equity Income Fund and the Large Cap Growth Fund declare and pay
dividends monthly. The Small Cap Growth Fund and the International Equity Fund
declare and pay dividends annually, provided that there is net investment income
at the end of the fiscal year.
(G) 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 the Intermediate Tax-Exempt Fund are
accreted, and premiums on securities purchased for the Intermediate New York
Tax-Exempt Fund, the Intermediate Tax-Exempt Fund, the Money Fund, and the
Treasury Money Fund are amortized.
(H) FINANCIAL STATEMENTS PREPARATION
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
109
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
for the period. Actual results could differ from those estimates.
(I) ORGANIZATION COSTS
Costs incurred in connection with the organization and initial registration of
the Large Cap Growth Fund, Small Cap Growth Fund, International Equity Fund,
Intermediate Investment Grade Fund, Intermediate Tax-Exempt Fund and Treasury
Money Fund are being amortized evenly over the period of benefit not to exceed
60 months from the date upon which those 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%
Large Cap Growth Fund....................................................... .60%
Small Cap Growth Fund....................................................... .75%
International Equity Fund................................................... .425%
Intermediate Government Fund................................................ .50%
Intermediate Investment Grade Fund.......................................... .50%
Intermediate New York Tax-
Exempt Fund............................................................... .50%
Intermediate Tax-Exempt Fund................................................ .50%
Money Fund.................................................................. .10%
Treasury Money Fund......................................................... .10%
</TABLE>
The International Equity Fund is also sub-advised by Indocam, formerly
Indosuez International Investment Services (the "Sub-Adviser"), a subsidiary of
Banque Indosuez. The Fund accrues daily an additional fee to the Sub-Adviser,
payable monthly at the rate of .425% of average daily net assets of the
International Equity Fund.
BNY Hamilton Distributors, Inc. (a wholly-owned subsidiary of The BISYS Group,
Inc.) acts as the Funds' administrator (the "Administrator") and will assist 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 Administration Agreement permits the Administrator to delegate
certain of responsibilities to other service providers. Pursuant to this
authority, the Administrator had delegated certain administrative functions to
The Bank of New York. The Bank of New York is not an affiliated person of BNY
Hamilton Distributors, Inc.
110
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
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%
Large Cap Growth Fund....................................................... .20%
Small Cap Growth Fund....................................................... .20%
International Equity Fund................................................... .20%
Intermediate Government Fund................................................ .20%
Intermediate Investment Grade Fund.......................................... .20%
Intermediate New York Tax-
Exempt Fund............................................................... .20%
Intermediate Tax-Exempt Fund................................................ .20%
Money Fund.................................................................. .10%
Treasury Money Fund......................................................... .10%
</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 ("Custodian"). Each Fund
maintains a compensating balance arrangement with the Custodian, whereby a Fund
would have its respective custody fees reduced by income earned on cash balances
maintained with the Custodian. The income earned on cash balances by each Fund
for the six months ended June 30, 1999 is shown on its respective Statement of
Operations under the caption "Earnings Credit Adjustment." For the six months
ended June 30, 1999, the Intermediate New York Tax-Exempt Fund did not earn any
such monies.
For the period January 1, 1999 - March 31, 1999, the Bank of New York
voluntarily agreed to assume/waive expenses for certain Funds to the extent that
each Fund's expense ratio exceeded the percentage of average daily net assets as
shown below:
<TABLE>
<CAPTION>
INSTITUTIONAL INVESTOR
SHARES SHARES
------------- -------------
<S> <C> <C>
Large Cap Growth Fund............................. .82% 1.07%
Small Cap Growth Fund............................. .97% 1.22%
International Equity Fund......................... 1.27% 1.52%
Intermediate Government Fund...................... .90% 1.15%
Intermediate Investment Grade Fund................ .90% 1.15%
Intermediate New York Tax-Exempt Fund............. .90% 1.15%
Intermediate Tax-Exempt Fund...................... .90% 1.15%
</TABLE>
Commencing April 1, 1999, the waivers for both classes of the Large Cap Growth
Fund and International Equity Fund were discontinued. The Bank of New York
voluntarily agreed to assume/waive expenses for certain Funds to the extent that
each Fund's expense ratio exceeded the percentage of average daily net assets as
shown below.
<TABLE>
<CAPTION>
INSTITUTIONAL INVESTOR
SHARES SHARES
------------- -------------
<S> <C> <C>
Small Cap Growth Fund............................. 1.11% 1.36%
Intermediate Government Fund...................... .79% 1.04%
Intermediate Investment Grade Fund................ .79% 1.04%
Intermediate New York Tax-Exempt Fund............. .79% 1.04%
Intermediate Tax-Exempt Fund...................... .79% 1.04%
</TABLE>
The Equity Income Fund, Money Fund, and Treasury Money Fund did not have any
expense waivers for the six months ended June 30, 1999.
Management reserves the right to implement or discontinue expense limitations
at any time.
The Company has adopted a distribution plan (the "12b-1 Plans") with respect
to each
111
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
Fund. Under the 12b-1 Plans, the Funds will pay the Distributor for distribution
expenses incurred in connection with sales of shares as outlined in the
following chart:
<TABLE>
<CAPTION>
DATE OF
IMPLEMENTATION OF
NAME OF FUND CLASS 12B-1 PLAN
- -------------------------------------------------- ----------------- -----------------
<S> <C> <C>
Equity Income Fund................................ Investor April 1, 1997
Large Cap Growth Fund............................. Investor May 1, 1997
Small Cap Growth Fund............................. Investor May 1, 1997
International Equity Fund......................... Investor May 1, 1997
Intermediate Government Fund...................... Investor April 1, 1997
Intermediate Investment Grade Fund................ Investor May 1, 1997
Intermediate New York Tax-Exempt Fund............. Investor April 1, 1997
Intermediate
Tax-Exempt Fund................................. Investor May 1, 1997
Money Fund........................................ Hamilton Classic December 4, 1995
Treasury Money Fund............................... Hamilton Classic April 30, 1999
</TABLE>
Payments for distribution expenses may not exceed .25% of the average daily
net assets of each class noted in the chart above.
BNY Hamilton Funds, Inc. has adopted a shareholder servicing plan for the
Money Fund and the Treasury Money Fund, pursuant to which, Hamilton Premier
Shares and Hamilton Classic Shares of both of those Funds are sold to certain
institutions that enter into servicing agreements with the Company. The Bank of
New York and the Administrator (the "Shareholder Servicing Agents") have each
entered into Shareholder Service Agreements with respect to these Shares. The
Shareholder Servicing Agents will perform shareholder support services. Pursuant
to the Shareholder Service Agreements, Hamilton Premier Shares and Hamilton
Classic Shares of the Money Fund and of the Treasury Money Fund will pay the
Shareholder Servicing Agents an annual shareholder servicing fee, accrued daily
and payable monthly, of .25% of the Shares' respective average daily net assets.
The shareholder servicing plan does not cover, and the fees thereunder are not
payable to, Shareholder Organizations with respect to Hamilton Shares of the
Money Fund and the Treasury Money Fund.
The brokerage firm of ESI Securities ("ESI") became a wholly-owned subsidiary
of the Bank of New York in 1998. During the six months ended June 30, 1999, the
Large Cap Growth Fund paid brokerage commissions of $1,050, to ESI.
4. PORTFOLIO SECURITIES
For the six months ended June 30, 1999, the cost of securities purchased and
the proceeds from sales of securities, excluding short-term securities, were as
follows:
<TABLE>
<CAPTION>
EQUITY INCOME FUND
--------------------------
PURCHASES SALES
------------ ------------
<S> <C> <C>
US Gov't Securities............................... $ -- $ --
All Others........................................ 184,725,246 175,649,149
<CAPTION>
LARGE CAP GROWTH FUND
--------------------------
PURCHASES SALES
------------ ------------
<S> <C> <C>
US Gov't Securities............................... $ -- $ --
All Others........................................ 52,081,407 68,806,612
<CAPTION>
SMALL CAP GROWTH FUND
--------------------------
PURCHASES SALES
------------ ------------
<S> <C> <C>
US Gov't Securities............................... $ -- $ --
All Others........................................ 111,068,938 112,685,904
</TABLE>
112
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
--------------------------
PURCHASES SALES
------------ ------------
US Gov't Securities............................... $ -- $ --
<S> <C> <C>
All Others........................................ 90,149,125 91,274,098
<CAPTION>
INTERMEDIATE
GOVERNMENT FUND
--------------------------
PURCHASES SALES
------------ ------------
<S> <C> <C>
US Gov't Securities............................... $ 17,200,518 $ 8,484,559
All Others........................................ 154,357 1,738,084
<CAPTION>
INTERMEDIATE INVESTMENT
GRADE FUND
--------------------------
PURCHASES SALES
------------ ------------
<S> <C> <C>
US Gov't Securities............................... $ 97,200,750 $ 71,553,103
All Others........................................ 53,416,509 55,150,308
<CAPTION>
INTERMEDIATE NEW YORK
TAX-EXEMPT FUND
--------------------------
PURCHASES SALES
------------ ------------
<S> <C> <C>
US Gov't Securities............................... $ -- $ --
All Others........................................ 5,835,342 8,191,314
<CAPTION>
INTERMEDIATE TAX-EXEMPT
FUND
--------------------------
PURCHASES SALES
------------ ------------
<S> <C> <C>
US Gov't Securities............................... $ -- $ --
All Others........................................ 61,335,247 58,749,447
</TABLE>
5. FEDERAL INCOME TAXES
For federal income tax purposes, the Funds indicated below have capital loss
carryforwards as of December 31, 1998 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>
International Equity Fund............................. $ 114,800 2005
9,953,400 2006
Intermediate Government Fund.......................... 881,300 2002
681,600 2003
447,700 2004
390,800 2005
</TABLE>
6. WRITTEN OPTION ACTIVITY
Transactions in written options for the six months ended June 30, 1999 were as
follows:
EQUITY INCOME FUND
<TABLE>
<CAPTION>
NUMBER OF PREMIUMS
CONTRACTS RECEIVED
--------- ---------
<S> <C> <C>
Options outstanding at December 31, 1998................... 600 $ 163,194
Options written during the period.......................... 750 188,993
Options expired............................................ (600) (163,194)
--- ---------
Options outstanding at June 30, 1999....................... 750 $ 188,993
--- ---------
--- ---------
</TABLE>
LARGE CAP GROWTH FUND
<TABLE>
<CAPTION>
NUMBER OF PREMIUMS
CONTRACTS RECEIVED
--------- -----------
<S> <C> <C>
Options outstanding at December 31, 1998............... 1,800 $ 590,832
Options written during the period...................... 9,759 3,244,203
Options terminated in closing purchase transactions.... (1,300) (396,861)
Options exercised...................................... (2,356) (689,938)
Options expired........................................ (5,456) (2,036,950)
--------- -----------
Options outstanding at June 30, 1999................... 2,447 $ 711,286
--------- -----------
--------- -----------
</TABLE>
113
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
7. RECLASSIFICATION OF CAPITAL ACCOUNTS
At December 31, 1998, reclassifications were made to the capital accounts of
all Funds except the Intermediate New York Tax-Exempt Fund to reflect permanent
book/tax differences and income and gains available for distributions under
income tax regulations. Net investment income, net realized gains, and net
assets were not affected by these changes.
8. GEOGRAPHIC CONCENTRATION
The International Equity Fund has a relatively large concentration of
portfolio securities invested in companies domiciled in Japan. The International
Equity Fund may be more susceptible to political, social and economic events
adversely affecting Japanese companies than funds not so concentrated.
9. CONCENTRATION OF RISK
The Intermediate New York Tax-Exempt Fund invests substantially all of its
assets in a portfolio of tax-exempt debt obligations primarily consisting of
securities issued by the State of New York and its authorities, agencies,
municipalities and political sub-divisions. Also, the Intermediate Tax-Exempt
Fund invests approximately 25% of its assets in debt obligations of the State of
New York. The issuers' ability to meet their obligations may be affected by New
York's political, social, economic, and/or regional developments.
10. YEAR 2000
The Funds could be adversely affected if the computer systems used by the
Adviser and the Company's other service providers do not properly process and
calculate date-related information from and after January 1, 2000. The Adviser
is working to avoid Year 2000-related problems in its systems and to obtain
assurances from other service providers that they are taking similar steps. In
addition, issuers of securities in which each Fund invests may be adversely
affected by Year 2000-related problems. This could have an impact on the value
of each Fund's investments and their share prices.
11. CHANGE OF INDEPENDENT ACCOUNTANTS
During the fiscal year the Board of Trustees of the Funds approved a change of
the Company's Independent Accountants to Ernst & Young LLP.
114
<PAGE>
DIRECTORS AND OFFICERS
Edward L. Gardner, Director and Chairman of the Board
Peter Herrick, Director
Stephen Stamas, Director
James E. Quinn, Director
Karen Osar, Director
Kim Kelly, Director
J. David Huber, Chief Executive Officer
William J. Tomko, President
Richard Baxt, Vice President
Michael A. Grunewald, Vice President
Nimish Bhatt, Treasurer
Ellen Stoutamire, Secretary
Alaina Metz, Assistant Secretary
INVESTMENT ADVISER
The Bank of New York
ADMINISTRATOR AND DISTRIBUTOR
BNY Hamilton Distributors, Inc.
TRANSFER AGENT
BISYS Fund Services, Ohio, Inc.
CUSTODIAN
The Bank of New York
INDEPENDENT AUDITORS
Ernst & Young LLP
LEGAL COUNSEL
Sullivan & Cromwell
115
