OLD WESTBURY FUNDS INC, N-30D, 1997-12-30

OLD WESTBURY FUNDS INC
N-30D, 1997-12-30

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0
OLD WESTBURY
INTERNATIONAL FUND

Annual Report
October 31, 1997

Bessemer Trust
------------------
Investment Advisor

OLD WESTBURY INTERNATIONAL FUND
INVESTMENT ADVISOR'S REPORT
November 1997
- --------------------------------------------------------------------------------

The performance of international markets was mixed over the fiscal year
ended October 31, 1997.+ The period from December, 1996 through the end of
September, 1997 saw positive returns from Europe and Latin America and very poor
returns from emerging Asia. All of the emerging economies in Asia had large
external deficits which made them vulnerable to a collapse of confidence. In
October, the pressure moved to Taiwan and Hong Kong which have had large
external surpluses and foreign exchange reserves; this caused all markets to
panic. Emerging markets generally were hit the worst as lower liquidity
accentuated the declines.

PERFORMANCE

The total return of the Old Westbury International Fund portfolio (the
"Portfolio") rose by 8.2%, before fees and expenses, for the fiscal year ended
October 31, 1997.* This compares with a rise of 4.6% in the Morgan Stanley
Capital International: Europe, Australia and Far East ('EAFE') Index** over the
same period, while the Morgan Stanley Capital International Emerging Markets
Free ('EMF') Index** which measures the performance of the "free" emerging
markets, fell by 8.5%. The Portfolio benefited from overweighted positions in
Finland, Spain, and Latin America, and no exposure to Japan until mid-January.
In the second half of the fiscal year, the Portfolio underperformed the EAFE
Index falling 2.1% compared to a rise of 3.0% in the EAFE Index. This was due to
the Portfolio's exposure to emerging markets which fell 17.5% over the last six
months of the period.

- ------------------
+ Foreign investing involves special risks including currency risk and
increased volatility of foreign securities.

* Performance quoted represents past performance and is not indicative of
future results. Investment return and principal value will fluctuate, so that
an investor's shares, when redeemed, may be worth more or less than their
original cost. The Portfolio's total return based on offering price for the
period was 1.8%.

** The EAFE Index is a weighted index comprised of approximately 1,100
securities listed on the stock exchanges of Europe, Australia and the Far
East. The EMF Index is a weighted index comprised of approximately 1,100
securities in 20 "free" emerging markets. A free market is defined as a
market with no restrictions on foreign investors. These indices are
unmanaged, and investments cannot be made in an index.

OLD WESTBURY INTERNATIONAL FUND
INVESTMENT ADVISOR'S REPORT
November 1997 (Continued)
- --------------------------------------------------------------------------------

PORTFOLIO COMPOSITION

The Portfolio was significantly restructured in the first half of the
fiscal year when the Portfolio took a position in Japan for the first time in
some years and initiated investments in Chile and Romania. Only modest changes
were made in the second half of the fiscal year with some profits taken from
investments in Hong Kong and Australia and reinvested in Europe. Cash was raised
at the end of September as some markets were looking a little extended, which
then provided some protection in October.

CONCLUSION

The Portfolio suffered in the last month of the fiscal year as all markets
fell. However, looking ahead, we believe that concerns have been exaggerated,
particularly in Hong Kong, Singapore and Latin America. Confidence has been
badly hit and volatility is likely to continue, but we believe that this period
of extreme pessimism about the outlook for certain markets can provide
attractive opportunities. We have already started to increase our exposure to
Hong Kong. Earnings are recovering strongly in Europe and Australia and this,
coupled with restructuring, should support these markets.

OLD WESTBURY INTERNATIONAL FUND
INVESTMENT ADVISOR'S REPORT
November 1997 (Continued)
- --------------------------------------------------------------------------------
[GRAPH APPERS HERE-SEE APPENDIX]

AVERAGE ANNUAL TOTAL RETURNS
FOR THE PERIOD ENDED OCTOBER 31, 1997+

<TABLE>
<CAPTION>
SINCE
OLD WESTBURY INTERNATIONAL FUND 1 YEAR INCEPTION**
<S> <C> <C>
Without sales charge................................... 6.6% 5.0%
With 4.5% sales charge................................. 1.8% 3.8%
</TABLE>

- ------------------
** October 22, 1993

+Performance quoted represents past performance and is not indicative of future
results. Investment return and principal value will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less than their original
cost.

The chart above illustrates the total value of a $10,000 investment from
inception (assuming a 4.5% sales charge) with dividends and capital gains
reinvested. The EAFE Index also includes the reinvestment of dividends, net of
withholding taxes, but does not include fees and expenses associated with an
investment in the Portfolio. The EMF Index includes the reinvestment of gross
dividends, but does not include fees and expenses associated with an investment
in the Portfolio.

OLD WESTBURY INTERNATIONAL FUND
INVESTMENT OUTLOOK
November 1997
- --------------------------------------------------------------------------------

JAPAN

The impact of the sales tax increase has been much more substantial than
expected and domestic demand has fallen sharply. This has left the economy
reliant on export growth which has been undermined by the problems in the rest
of Asia. Looking forward, the economy is likely to continue to stagnate without
a serious reflationary package. The Japanese authorities have promised two
packages which are unlikely to offer the necessary restructuring required but
should provide some support in the form of lower interest rates, tax cuts and
some measures to reliquify the property market. Pessimism is now so widespread
that we believe that share prices in a number of sectors simply discount a lot
of the bad news. We therefore see good opportunities for quality exporters and
selected well-run domestic companies to appreciate. We continue to avoid the
financial sector.

PACIFIC BASIN

Australia, Hong Kong, New Zealand and Singapore have finally been exposed
to the problems of emerging Asia but their fundamentals are significantly
better. Hong Kong and Singapore have well-capitalized banking sectors and
substantial reserves, and Hong Kong should be a major beneficiary of positive
developments in China. Australia and New Zealand will suffer from weaker demand
for their commodity exports, but they are emerging from periods of slow growth
and should benefit from accelerating earnings as their economies recover. The
rest of the Pacific Rim has suffered as exports have shown little recovery. The
scale of the problems in Thailand has caused concern about the property and
banking sectors in the whole of the region. The currencies have been oversold
and by all accounts could rebound 10-15% as confidence returns, but markets may
not perform until exports show clear evidence of improvement.

EUROPE

The major continental European countries have seen their economies recover
on the heels of strong exports due to the depreciation of their currencies. With
the exception of Germany, this export-led growth has broadened into domestic
economies. Earnings estimates are being steadily increased and there appears to
be no risk of inflation picking up. This should continue to support the European
stock markets. We believe commitment by European companies to restructure their
operations and increase their focus on shareholder value should enhance profits.

OLD WESTBURY INTERNATIONAL FUND
INVESTMENT OUTLOOK
November 1997 (Continued)
- --------------------------------------------------------------------------------

LATIN AMERICA

The equity markets in Latin America were volatile in the last six months of
the fiscal year with the Morgan Stanley Capital International Latin America
Index soaring 20% in terms of U.S. dollars from May to September, only to give
back all these gains in the last ten days of October. The strong performance had
been driven by Brazil and Mexico, where improving earnings prospects based on
recovering economic fundamentals and a reduction in risk premiums had prompted a
significant re-rating of the market. However, the currency and market crises in
Asia had a spillover effect on the emerging market asset class, and in markets
with both fiscal and trade-deficits such as Brazil, investor concern that there
was high risk of an Asian-style currency shock prompted steep and sudden falls.
Looking forward, the recent declines in the region have taken some of the froth
off index levels, and in much of the region earnings prospects and current
valuations offer attractive opportunities, assuming a benign economic
environment in the U.S.

OLD WESTBURY INTERNATIONAL FUND
INVESTMENT OUTLOOK
November 1997 (Continued)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
GEOGRAPHICAL AREA PORTFOLIO ALLOCATION AT EAFE
10/31/97 4/30/97 10/31/96 INDEX
<S> <C> <C> <C> <C>
Australia......................... 7.3% 10.0% 11.4% 2.6%
Hong Kong......................... 7.3 9.5 9.5 2.8
Rest of Asia...................... 7.9 11.8 15.8 2.3

UK................................ 11.7 9.6 8.9 21.1

France............................ 6.2 6.4 6.4 7.1
Germany........................... 4.2 4.5 4.0 9.2
Netherlands....................... 3.6 3.5 3.6 5.6
Switzerland....................... 3.4 2.5 2.4 7.3
Spain............................. 3.1 3.0 4.8 2.5
Italy............................. 1.4 1.1 1.3 3.7
Rest of Europe.................... 9.3 8.1 11.6 7.1

Latin America..................... 12.8 12.2 10.8 --

South Africa...................... 2.1 0.9 3.0 --

Canada............................ -- 1.0 2.1 --

Japan............................. 13.5 12.3 -- 28.7

Other assets and
liabilities, net*............... 6.2 3.6 4.4 --
----------- --------- ----------- -----------
100.0% 100.0% 100.0% 100.0%
----------- --------- ----------- -----------
----------- --------- ----------- -----------
</TABLE>

- ------------------
* Includes cash, unrealized gains/losses on forward foreign currency contracts,
pending trades and fund share transactions, interest and dividends receivable
and accrued expenses payable.

OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SHARES VALUE
- ----------- --------------------------------------------------- ----------------
<C> <S> <C>
COMMON AND PREFERRED STOCKS--93.8%

ARGENTINA--2.0%
217,562 Banco De Galicia Y Buenos Aires (Banks) $ 1,317,027
41,000 Banco Rio De La Plata ADR (Banks) 456,125
55,860 YPF Sociedad Anunima--Class D (Energy) 1,782,986
----------------
TOTAL ARGENTINA 3,556,138
----------------

AUSTRALIA--7.3%
373,900 Amcor Ltd. (Consumer Goods) 1,757,691
102,800 Brambles Industries, Ltd. (Services) 1,969,635
210,800 Broken Hill Proprietary Co. ORD (Diversified) 2,082,974
167,550 CSR Ltd. ORD (Materials) 580,167
465,685 Western Mining Corporation Ltd. (Materials) 1,648,078
439,500 Westpac Banking Corporation (Banks) 2,550,253
638,800 Woolworth ORD (Consumer Goods) 2,054,810
----------------
TOTAL AUSTRALIA 12,643,608
----------------

BRAZIL--5.1%
44,700 Bompreco Supermercados GDR (Consumer Goods) 961,050
48,000 Companhia Paranaense ADR Preferred-- Class B
(Utilities) 576,000
4,044 Electrobras Preferred B (1,000 shares) (Utilities) 1,760,653
50,900 Elevadores Atlas S.A. ORD (Capital Goods) 784,391
2,320 Light Servicios Electricidade Preferred (1000
shares) (Utilities) 768,052
3,213 Petrol Brasileiros (1,000 shares) Preferred
(Utilities) 632,469
33,087 (a)Telebras Telec Brasileiras (1,000 shares)
Preferred (Services) 3,316,495
----------------
TOTAL BRAZIL 8,799,110
----------------
</TABLE>

See Footnotes on Page 15.

OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SHARES VALUE
- ----------- --------------------------------------------------- ----------------
<C> <S> <C>
COMMON AND PREFERRED STOCKS--continued
CHILE--1.2%
53,680 Banco De A Edwards ADR (Banks) $ 932,690
42,589 Chilgener S.A. Sponsored ADR (Utilities) 1,160,550
----------------
TOTAL CHILE 2,093,240
----------------

EASTERN EUROPE--0.8%
430 Baltic Republics Fund Ltd. Preferred (Mutual Fund) 111,800
73,000 (a)First N.I.S. Regional Fund (Mutual Fund) 1,350,500
----------------
TOTAL EASTERN EUROPE 1,462,300
----------------

FINLAND--1.2%
26,960 Metra--Class B (Capital Goods) 718,725
16,400 Nokia--Class A (Electronics & Electrical Equipment) 1,432,010
----------------
TOTAL FINLAND 2,150,735
----------------

FRANCE--6.2%
4,548 Accor (Services) 846,015
35,100 Banque National De Paris (Banks) 1,550,246
1,350 Carrefour (Consumer Goods) 703,807
10,732 Cetelem (Financial Services & Property) 1,189,636
10,000 France Telecom S.A. ORD (Services) 378,100
11,175 Lafarge S.A. (Materials) 697,545
31,944 Michelin--Class B (Capital Goods) 1,637,147
3,379 (a)Pinault Printemps (Consumer Goods) 1,543,890
18,218 Schneider S.A. ORD (Capital Goods) 971,862
17,643 Valeo (Consumer Goods) 1,175,568
----------------
TOTAL FRANCE 10,693,816
----------------

GERMANY--4.2%
9,014 Adidas AG (Consumer Goods) 1,304,142
5,400 Allianz AG Holdings--Class D (Financial Services &
Property) 1,202,435
10,335 Daimler-Benz AG (Capital Goods) 692,196
23,361 Deutsche Bank AG ORD (Banks) 1,528,049
</TABLE>

See Footnotes on Page 15.

OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SHARES VALUE
- ----------- --------------------------------------------------- ----------------
<C> <S> <C>
COMMON AND PREFERRED STOCKS--continued
GERMANY (Continued)
19,662 Hoechst AG ORD (Health Care) $ 747,943
1,677 Linde AG (Capital Goods) 1,011,354
14,851 Siemens AG (Electronics & Electrical Equipment) 913,709
----------------
TOTAL GERMANY 7,399,828
----------------

HONG KONG--7.3%
3,102,800 Cafe De Coral Hldg. ORD (Consumer Goods) 606,227
6,524,640 Champion Technology (Financial Services & Property) 793,577
405,500 Citic Pacific Ltd. (Diversified) 1,941,321
2,978,400 Gold Peak Industry Holdings Ltd. (Consumer Goods) 1,811,280
595,680 (a)Gold Peak Warrants (Consumer Goods) 50,870
3,645,000 Guangzhou Investments (Diversified) 872,517
557,800 Jardine Matheson Holdings ORD (Singapore
Registered) (Diversified) 3,569,920
400,490 Ka Wah Bank Ltd. (Banks) 582,974
2,530,360 Kantone Holdings Ltd. ORD (Electronics & Electrical
Equipment) 258,651
192,849 Swire Pacific Ltd. ORD--Class A (Diversified) 1,030,558
929,570 Union Bank of Hong Kong ORD (Banks) 1,166,698
----------------
TOTAL HONG KONG 12,684,593
----------------

HUNGARY--0.2%
2,975 Gedeon Richter GDR 'S' (Health Care) 276,675
----------------

INDIA--1.9%
61,250 Bajaj Auto Ltd. GDR Reg S (Capital Goods) 1,090,250
100,367 Mahindra & Mahindra GDR (Capital Goods) 988,612
</TABLE>

See Footnotes on Page 15.

OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

INDONESIA--0.1%
1,034,000 Asahimas Flat Glass ORD (Capital Goods) 151,634
915,000 Trias Sentosa ORD (Materials) 102,235
----------------
TOTAL INDONESIA 253,869
----------------

IRELAND--2.0%
151,969 Allied Irish Banks (Banks) 1,284,833
110,025 Bank of Ireland ORD (Banks) 1,387,886
164,500 Irish Life PLC ORD (Financial Services & Property) 864,604
----------------
TOTAL IRELAND 3,537,323
----------------

ITALY--1.4%
382,100 Telecom Italia ORD (Services) 2,390,185
----------------

JAPAN--13.5%
398,000 Fujitsu Ltd. ORD (Electronics and Electrical
Equipment) 4,365,268
279,000 Matsushita Electric Industrial Company (Electronics
and Electrical Equipment) 4,682,842
495,000 Mitsubishi Motors Corporation (Capital Goods) 2,171,666
65,000 Murata Manufacturing Company ORD (Electronics &
Electrical Equipment) 2,614,042
212,000 Mycal Corporation ORD (Consumer Goods) 2,025,758
56,000 NGK Insulators ORD (Utilities) 483,922
302 Nippon Telephone & Telegraph Co. (Services) 2,559,535
793,000 NKK Corporation (Materials) 1,100,382
45,000 Ono Pharmaceutical Company (Health Care) 1,346,074
62,000 Sankyo Company Ltd. (Health Care) 2,045,202
----------------
TOTAL JAPAN 23,394,691
----------------
</TABLE>

See Footnotes on Page 15.

OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SHARES VALUE
- ----------- --------------------------------------------------- ----------------
<C> <S> <C>
COMMON AND PREFERRED STOCKS--continued
MALAYSIA--1.0%
954,600 Sime Darby Berhad ORD (Diversified) $ 1,369,830
644,840 Sungei Way Holdings ORD (Materials) 424,110
----------------
TOTAL MALAYSIA 1,793,940
----------------

MEXICO--2.9%
740,350 Controlador Comercial Mexicana S.A. (Consumer
Goods) 743,016
174,440 Corp. Geo S.A.--Series B (Capital Goods) 946,541
84,450 Desc Sociedad Fomento--Class C (Diversified) 724,871
313,880 Empresas Ica Sociedad Controladora (Materials) 704,629
88,745 Femsa-Fomento Economico Mexicano-- Class B
(Consumer Goods) 626,435
288,050 Kimberly Clark De Mexico--Class A (Consumer Goods) 1,270,809
----------------
TOTAL MEXICO 5,016,301
----------------

NETHERLANDS--3.6%
67,740 ABN Amro Holdings NV ORD (Banks) 1,362,466
7,685 Akzo Nobel NLG20 (Health Care) 1,352,386
27,603 IHC Caland NV ORDS (Capital Goods) 1,695,369
15,385 Wolters Kluwer (Consumer Goods) 1,886,720
----------------
TOTAL NETHERLANDS 6,296,941
----------------

NEW ZEALAND--1.4%
762,172 Air New Zealand--Class B ORD (Services) 1,611,323
155,100 Telecom Corp. of New Zealand ORD (Services) 750,312
----------------
TOTAL NEW ZEALAND 2,361,635
----------------
</TABLE>

See Footnotes on Page 15.

OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SHARES VALUE
- ----------- --------------------------------------------------- ----------------
<C> <S> <C>
COMMON AND PREFERRED STOCKS--continued
PERU--1.6%
1,050,144 Edegel Shares S.A. (Utilities) $ 445,633
37,000 Luz Del Sur ADR (Utilities) 675,250
168,208 Minsur--Class T (Materials) 453,106
568,239 Telefonica Del Peru--Class B (Services) 1,134,381
----------------
TOTAL PERU 2,708,370
----------------

PHILIPPINES--0.7%
200,633 Bacnotan Consolidated Industries (Materials) 135,097
109,051 (a)Jardine Davies, Inc. (Diversified) 93,740
39,580 Philippine Long Distance Telephone (Services) 992,335
----------------
TOTAL PHILIPPINES 1,221,172
----------------

POLAND--2.0%
18,926 Bank Slaski S.A. ORD (Banks) 1,104,017
223,902 Elektrim S.A. ORD (Capital Goods) 2,110,341
10,000 Powszechny Bank Kredytowv (Banks) 215,517
----------------
TOTAL POLAND 3,429,875
----------------

PORTUGAL--0.5%
8,500 Electricidad De Portugal S.A. ORD (Services) 149,148
19,700 Portugal Telecom S.A. ORD (Services) 806,794
----------------
TOTAL PORTUGAL 955,942
----------------

ROMANIA--0.7%
11,287 Societe Generale Romania Fund Ltd. (Mutual Fund) 1,139,987
----------------

SINGAPORE--2.8%
717,820 City Developments (Financial Services & Property) 3,012,790
991,730 Hotel Properties Ltd. ORD (Financial Services &
Property) 750,498
</TABLE>

See Footnotes on Page 15.

OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

SOUTH AFRICA--2.1%
373,000 Billiton ORD (Materials) 1,078,010
26,680 DeBeers Consolidated Mines/Cetenary Link
(Materials) 636,439
127,800 Ellerine Holdings ORD (Consumer Goods) 969,288
77,063 Sasol Ltd. ORD (Energy) 928,757
----------------
TOTAL SOUTH AFRICA 3,612,494
----------------

SPAIN--3.1%
10,675 Banco Intercontinental ORD (Banks) 523,054
9,300 Empresa NH Ribagorzan--Sr. B (Utilities) 190,187
28,780 Gas Natural S.A. ORD (Utilities) 1,331,164
65,100 Telefonica De Espana ORD (Services) 1,773,586
61,495 Vallehermoso (Financial Services & Property) 1,561,429
----------------
TOTAL SPAIN 5,379,420
----------------

SWEDEN--1.0%
64,450 Nobel Biocare AB (Health Care) 831,890
45,350 Sparbanken Sverige AB Series A (Banks) 1,025,882
----------------
TOTAL SWEDEN 1,857,772
----------------

SWITZERLAND--3.4%
1,615 ABB AG SF 50 ORD (Capital Goods) 2,088,641
1,400 Novartis CHF20 Reg S.A. ORD (Health Care) 2,197,139
6,005 SBC--Registered ORD (Banks) 1,593,602
----------------
TOTAL SWITZERLAND 5,879,382
----------------
</TABLE>

See Footnotes on Page 15.

OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SHARES VALUE
- ----------- --------------------------------------------------- ----------------
<C> <S> <C>
COMMON AND PREFERRED STOCKS--continued
TURKEY--0.9%
2,656,626 NETAS ORD (Consumer Goods) $ 794,100
7,359,000 Sarkuysan Elektrolitik Bakir (Materials) 799,891
----------------
TOTAL TURKEY 1,593,991
----------------

UNITED KINGDOM--11.7%
107,000 Allied Domecq PLC (Consumer Goods) 870,889
180,400 British Airways ORD (Services) 1,756,530
168,460 Cable & Wireless PLC ORD (Electronics & Electrical
Equipment) 1,341,528
207,118 Carlton Communications PLC ORD (Electronics &
Electrical Equipment) 1,706,550
130,080 Grand Metropolitan PLC ORD (Consumer Goods) 1,170,816
126,300 Land Securities ORD (Financial Services & Property) 2,112,999
188,000 Peninsula & Oriental DFD (Diversified) 2,170,216
245,350 Royal Sun Alliance ORD (Financial Services &
Property) 2,325,316
94,800 Rio Tinto PLC (Materials) 1,218,051
222,000 Scottish Power ORD (Utilities) 1,656,471
109,667 Siebe PLC (Diversified) 2,100,765
134,408 The Boots Company PLC ORD (Health Care) 1,920,344
----------------
TOTAL UNITED KINGDOM 20,350,475
----------------
TOTAL INVESTMENTS--93.8%
(Identified Cost $159,229,466)(b) 163,082,210
----------------
</TABLE>

See Footnotes on Page 15.

OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

- ------------------
(a) Non-income producing security.
(b) At October 31, 1997, the cost of investments for federal income tax
purposes was substantially the same as the cost for financial reporting.
The aggregate gross unrealized appreciation was $24,289,298 and the
aggregate gross unrealized depreciation was $20,436,554, resulting in net
unrealized appreciation of $3,852,744.

The following acronyms are used in this portfolio:
ADR--American Depositary Receipts
GDR--Global Depositary Receipts
ORD--Ordinary Shares
PLC--Public Limited Company

Note: The categories of investments are shown as a percentage of net assets
($173,793,408) at October 31, 1997.

See Notes to Financial Statements.

OLD WESTBURY INTERNATIONAL FUND
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
ASSETS:
Investments, at market value (identified cost $159,229,466)..... $ 163,082,210
Cash............................................................ 12,343,256
Receivables for:
Funds shares sold......................................... 62,000
Dividends................................................. 288,679
Interest.................................................. 85,046
Foreign withholding taxes--dividends...................... 207,734
Deferred organization expense................................... 17,630
----------------
Total assets.............................................. 176,086,555
----------------
LIABILITIES:
Payables for:
Investments purchased..................................... 1,008,530
Fund shares redeemed...................................... 783,000
Accrued expenses.......................................... 501,617
----------------
Total liabilities......................................... 2,293,147
----------------
NET ASSETS APPLICABLE TO 14,785,553 SHARES OF
CAPITAL STOCK OUTSTANDING....................................... $ 173,793,408
================
Net Assets consist of:
Paid-in capital................................................. $ 159,261,032
Undistributed net investment income............................. 1,164,367
Accumulated net realized gain on investments and
foreign currency transactions................................ 9,521,126
Net unrealized appreciation on investments and
foreign currency transactions................................ 3,846,883
----------------
NET ASSETS........................................................ $ 173,793,408
================
NET ASSET VALUE AND REDEMPTION PROCEEDS PER SHARE
($173,793,408 / 14,785,553 SHARES OF CAPITAL STOCK
OUTSTANDING).................................................... $11.75
MAXIMUM OFFERING PRICE PER SHARE ($11.75 / .955).................. $12.30
</TABLE>

See Notes to Financial Statements.

OLD WESTBURY INTERNATIONAL FUND
STATEMENT OF OPERATIONS
For the fiscal year ended October 31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding
tax of $418,243)................................... $ 3,870,185
Interest............................................. 533,649
------------
Total income..................................... $ 4,403,834
------------
EXPENSES:
Investment advisory.................................. 1,381,951
Custody.............................................. 355,186
Administration....................................... 266,388
Shareholder servicing................................ 443,982
Registration......................................... 41,261
Amortization of organization costs................... 18,333
Distribution......................................... 7,519
Printing and postage................................. 19,364
Legal................................................ 38,685
Audit................................................ 43,500
Insurance............................................ 15,251
Transfer agent....................................... 46,811
Directors............................................ 7,751
Miscellaneous........................................ 20,650
------------
Total expenses................................... 2,706,632
Less fees waived:
Waiver of investment advisory fee.................. (1,978)
Waiver of administration fee....................... (40,776)
------------
Total waivers.................................... (42,754)
------------
Net expenses..................................... 2,663,878
------------
NET INVESTMENT INCOME.................................. 1,739,956
------------
NET REALIZED AND UNREALIZED GAIN/(LOSS):
NET REALIZED GAIN ON:
Investments........................................ 16,800,362
Foreign currency transactions...................... 1,527,364 18,327,726
------------ ------------
NET CHANGE IN UNREALIZED
APPRECIATION/(DEPRECIATION) ON:
Investments........................................ (13,207,521)
Translations of assets and liabilities in foreign
currencies and foreign currency contracts.......... 351,837 (12,855,684)
------------ ------------
NET REALIZED AND UNREALIZED GAIN....................... 5,472,042
------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS...................................... $ 7,211,998
============
</TABLE>

See Notes to Financial Statements.

OLD WESTBURY INTERNATIONAL FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
FISCAL YEAR FISCAL YEAR
ENDED ENDED
OCTOBER 31, 1997 OCTOBER 31, 1996
<S> <C> <C>
FROM OPERATIONS:
Net investment income......................... $ 1,739,956 $ 1,500,669
Net realized gain/loss on investments and
foreign currency transactions.............. 18,327,726 (2,108,945)
Net change in unrealized appreciation/
depreciation on investments and foreign
currency translations...................... (12,855,684) 17,667,965
---------------- ----------------
Net increase in net assets from operations.... 7,211,998 17,059,689
---------------- ----------------
DISTRIBUTION TO SHAREHOLDERS:
From net investment income.................... (1,851,779) (1,459,800)
---------------- ----------------
FROM CAPITAL STOCK TRANSACTIONS:
Net proceeds from sale of capital
stock...................................... 57,423,331 45,618,132
Reinvestment of dividends..................... 1,347,247 1,100,982
Net cost of capital stock redeemed............ (26,131,841) (30,719,037)
---------------- ----------------
Net increase in net assets resulting from
capital stock transactions................. 32,638,737 16,000,077
---------------- ----------------
NET INCREASE IN NET ASSETS.................... 37,998,956 31,599,966
NET ASSETS:
Beginning of period........................... 135,794,452 104,194,486
---------------- ----------------
End of period (including undistributed net
investment income of
$1,164,367 and $1,276,175, respectively)... $ 173,793,408 $ 135,794,452
================ ================
</TABLE>

See Notes to Financial Statements.

OLD WESTBURY INTERNATIONAL FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(For a share outstanding throughout each period)

<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
<S> <C> <C> <C> <C> <C>
1997 1996 1995 1994 1993(A)
Net asset value, beginning of
period........................ $ 11.16 $ 9.80 $ 10.81 $ 10.14 $ 10.00
Income from investment
operations:
Net investment income......... 0.12 0.13 0.14 0.10 0.00
Net realized and unrealized
gain (loss) on
investments................. 0.62 1.37 (1.07) 0.57 0.14
--------- --------- --------- --------- ---------
Total from investment
operations.................. 0.74 1.50 (0.93) 0.67 0.14
--------- --------- --------- --------- ---------
Less distributions:
Distributions from net
investment income........... (0.15) (0.14) (0.08) -- --
--------- --------- --------- --------- ---------
Net asset value, end of
period........................ $ 11.75 $ 11.16 $ 9.80 $ 10.81 $ 10.14
========= ========= ========= ========= =========
Total return*................. 6.6% 15.5% (8.6%) 6.6% 1.4%

Ratios/Supplemental data:
Net assets, end of period
(in 000's).................. $ 173,793 $ 135,794 $ 104,194 $ 104,529 $ 11,957
Ratio of expenses to average
net assets before waiver
of expenses................. 1.52% 1.52% 1.60% 1.70% 2.50%**+
Ratio of expenses to average
net assets.................. 1.50% 1.50% 1.50% 1.50% 1.50%**
Ratio of net investment income
(loss) to average net
assets...................... 0.98% 1.19% 1.40% 0.90% (0.91%)**
Portfolio turnover............ 58% 55% 32% 23% 0%
Average Commission rate paid.. 0.0077 0.0080 0.0100 -- --
</TABLE>

- ------------------
* Total return is calculated without a sales charge assuming a purchase of
shares on the first day and a sale on the last day of the period.
** Computed on annualized basis.
The calculation takes state expense limitations into consideration.
(a) For the period from October 22, 1993 (commencement of operations) to October
31, 1993.
Note: Per share values are calculated using average shares outstanding.

See Notes to Financial Statements.

OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1997
- --------------------------------------------------------------------------------

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES. Old Westbury International
Fund (the "Portfolio") is a separate series of Old Westbury Funds, Inc. (the
"Fund"), a Maryland corporation registered under the Investment Company Act of
1940 (the "Act"), as a diversified, open-end management investment company. The
Fund's Articles of Incorporation permit the Directors to create an unlimited
number of series, each of which is a separate class of shares. At October 31,
1997, the Fund consisted of the Portfolio and Old Westbury Growth Opportunity
Fund. The Fund was incorporated under the laws of the state of Maryland on
August 26, 1993 and commenced operations on October 22, 1993. The Portfolio's
investment objective is to seek long-term growth of capital.

The following is a summary of the significant accounting policies followed
by the Portfolio:

A. VALUATION OF INVESTMENTS. Securities listed on an exchange are valued,
except as indicated below, at the last sale price reflected at the close of the
regular trading session of the exchange on the business day as of which such
value is being determined. If there has been no sale on such day, the securities
are valued at the mean of the closing bid and asked prices. If no bid or asked
prices are quoted, then the security is valued by such method as the Board of
Directors shall determine in good faith to reflect its fair market value.
Portfolio securities traded on more than one national securities exchange are
valued at the last sale price on the exchange representing the principal market
for such securities.

Securities traded in the over-the-counter market, including listed
securities whose primary market is believed by Bessemer Trust Company, N.A.
("Bessemer"), the Portfolio's investment advisor (the "Advisor"), to be
over-the-counter, are valued at the mean of the last reported bid and asked
prices from such sources as the Board of Directors deems appropriate to reflect
their fair value.

Debt instruments having 60 days or less remaining until maturity are valued
at amortized cost. Debt instruments having a greater remaining maturity will be
valued at the bid price obtained from a dealer maintaining an active market in
that security or on the basis of prices obtained from a pricing service approved
as reliable by the Board of Directors. All other investment assets, including
restricted and not readily marketable securities, are valued under procedures
established by and under the general supervision and responsibility of the Board
of Directors designed to reflect in good faith the fair value of such
securities.

OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

B. FOREIGN CURRENCY TRANSLATION. The books and records of the Fund are
maintained in United States dollars. Foreign currency amounts are translated
into United States dollars on the following basis:

(i) value of investment securities, other assets and liabilities--at
the current rates of exchange.

(ii) purchases and sales of investment securities, income, and
expenses--at the rates of exchange prevailing on the respective dates of
such transactions.

Although the net assets of the Fund are presented at the foreign exchange
rates and values at the close of the period, the Fund does not isolate that
portion of the results of operations arising as a result of changes in the
foreign exchange rates from the fluctuations arising from changes in the value
of the securities held at the end of the period. Similarly, the Fund does not
isolate the effect of changes in foreign exchange rates from the fluctuations
arising from changes in the value of portfolio securities sold during the
period.

Foreign security and currency transactions may involve certain
considerations and risks not typically associated with those of U.S. companies
as a result of, among other factors, the level of governmental supervision and
regulation of foreign securities markets and the possibility of political and
economic instability.

C. FORWARD FOREIGN CURRENCY CONTRACTS. The Fund enters into forward foreign
currency contracts in order to hedge its exposure to changes in foreign currency
exchange rates on its foreign portfolio holdings. A forward foreign currency
contract is a commitment to purchase or sell a foreign currency at a future date
at a negotiated forward rate. Risks may arise upon entering into these contracts
from the potential inability of the counterparties to meet the terms of their
contracts. There were no forward foreign currency contracts open at October 31,
1997.

D. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME. Security
transactions are accounted for on the trade date. Realized gains and losses on
security transactions are determined on the specific identification cost method.
Dividend income and other distributions from portfolio securities are recorded
on the ex-dividend date except that, if the ex-dividend date has passed, certain
dividends from foreign securities are recorded as soon as the Portfolio is
informed of the ex-dividend date. Dividend income is

OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------
recorded net of foreign taxes withheld where recovery of such taxes is not
assured. Interest income is accrued daily.

E. DEFERRED ORGANIZATION EXPENSES. Expenses incurred by the Fund in
connection with its organization and the initial public offering of the
Portfolio's shares are being amortized on a straight-line basis over a five-year
period. The amount paid by the Portfolio on any redemption of the Portfolio's
initial shares will be reduced by the pro rata portion of any unamortized
organization which the number of the initial shares redeemed bears to the total
number of initial shares outstanding immediately prior to such redemption.

F. FEDERAL TAXES. It is the Portfolio's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income or excise tax provision is required.

G. DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS. The Portfolio anticipates
paying income dividends on an annual basis. Capital gains distributions, if any,
will be made on an annual basis. The treatment for financial statement purposes
of distributions made during the year from net investment income or net realized
gains may differ from their ultimate treatment for federal income tax purposes.
These differences are caused primarily by: differences in the timing of the
recognition of certain components of income, expense, and capital gain; and the
recharacterization of foreign exchange gains or losses to either ordinary income
or realized capital gain for federal tax purposes. Where such differences are
permanent in nature, they are reclassified in the components of net assets based
on their characterization for federal income tax purposes. Any such
reclassifications will have no effect on net assets, results of operations or
net asset value per share of the Portfolio.

2. TRANSACTIONS WITH AFFILIATES.

A. INVESTMENT ADVISORY FEES. Pursuant to an advisory contract, dated
October 12, 1993, the Fund has retained Bessemer to make investment decisions
for the Portfolio. The investment advisory fee paid to the advisor is computed
daily and paid monthly in accordance with the following schedule: 0.80% of the
first $100 million of the Portfolio's average net assets, 0.75% of the second
$100 million of such assets and 0.70% of such assets exceeding $200 million.

OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

B. ADMINISTRATION FEES. Federated Administrative Services ("FAS") served as
administrator. FAS provided administrative services necessary for the overall
administration of the Portfolio including, among other responsibilities, the
negotiation of contracts and fees with, and the monitoring of performance and
billings of, the independent contractors and the agents of the Portfolio, the
preparation and filing of all documents required for compliance by the Portfolio
with applicable laws and regulations; providing equipment and personnel
necessary for maintaining the organization of the Portfolio; preparation of
certain documents in connection with meetings of the Board of Directors and
shareholders; the maintenance of books and records of the Portfolio; and paying
the compensation of the Portfolio's officers and Directors affiliated with FAS.
For providing these services, FAS will receive a fee based on the level of
average aggregate daily net assets of the Portfolio for the period. FAS may
voluntarily choose to waive a portion of its fee. The administrative fee
received during the period of the Administrative Services Agreement shall be at
least $75,000.

C. DISTRIBUTION AND SERVICE PLAN AND DISTRIBUTION REIMBURSEMENT FEES. The
Directors adopted a distribution and service plan (the "Plan") for the Portfolio
pursuant to Rule 12b-1 of the Act, and pursuant to the Plan, the Portfolio
entered into a distribution agreement and a shareholder servicing agreement with
Edgewood Services, Inc. and a shareholder servicing agreement with Bessemer.
Under its shareholder servicing agreement, Edgewood Services, Inc. receives
payments for the Portfolio to permit it to make payments to broker-dealers for
providing shareholder services. Under its shareholder servicing agreement,
Bessemer is permitted (i) to receive a payment from the Portfolio attributable
to Bessemer's clients (and its affiliates) for providing shareholder services to
such clients and (ii) to receive payments to permit it to make payments to other
financial institutions as shareholder servicing agents. The total of shareholder
servicing fees in the aggregate payable to Edgewood Services, Inc. and Bessemer
will not exceed 0.25% per annum of the Portfolio's average daily net assets.

The distribution agreement with Edgewood Services, Inc. provides for
reimbursement to Edgewood Services, Inc. by the Portfolio for its distribution,
promotional and advertising costs incurred in connection with the distribution
of the Portfolio's shares in an amount not to exceed 0.10% per annum of the
Portfolio's average daily net assets.

OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

In addition, the Portfolio will pay for certain other expenses under the
Plan. These expenses shall not exceed an amount equal to 0.05% per annum of the
Portfolio's average daily net assets.

D. DIRECTORS' FEES. Each Director who is not an "interested person" (as
defined in the Act) of the Portfolio receives a $2,500 annual retainer paid in
quarterly installments of $625 plus $250 per meeting and is reimbursed for
out-of-pocket expenses incurred in connection with committee or board meetings.

E. CUSTODY FEES. The Fund has retained Bessemer to serve as the Portfolio's
custodian. Bessemer is responsible for maintaining the books and records of the
Portfolio's securities and cash. For providing these services, Bessemer receives
from the Portfolio a fee accrued and paid monthly at an annual rate equal to
0.20% of the average daily net assets of the Portfolio.

3. CAPITAL STOCK. The Fund has authorized a total of 20 billion shares of common
stock (par value $0.001 per share), of which the Portfolio is permitted to issue
4 billion. Transactions in shares of capital stock were as follows:

<TABLE>
<CAPTION>
FISCAL YEAR FISCAL YEAR
ENDED ENDED
OCTOBER 31, OCTOBER 31,
1997 1996
<S> <C> <C>
Common stock sold...................................... 4,533,069 4,294,507
Reinvestment of dividends.............................. 114,952 108,364
Common stock redeemed.................................. (2,028,400) (2,871,960)
------------ ------------
Net increase........................................... 2,619,621 1,530,911
============ ============
</TABLE>

4. PURCHASE AND SALES OF SECURITIES. For the fiscal year ended October 31, 1997,
purchases and sales of investment securities other than short-term investments
aggregated $124,724,986 and $95,153,854, respectively.

5. DISTRIBUTIONS AND FOREIGN TAXES WITHHELD. The following information
summarizes per share distributions to be paid by the Portfolio for the year
ended October 31, 1997.

<TABLE>
<CAPTION>
NET FOREIGN FOREIGN TAXES
RECORD PAYABLE SOURCE PAID OR LONG TERM
DATE DATE INCOME PER SHARE WITHHELD PER SHARE CAPITAL GAINS
<S> <C> <C> <C> <C>
12/22/97 1/5/98 $0.18 $0.03 $0.72
</TABLE>

OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

The foreign taxes paid or withheld represent taxes incurred by the
Portfolio on dividends received by the Portfolio from foreign sources. Pursuant
to IRC Section 853, the foreign taxes paid or withheld are fully available for
credit and should be included in taxable income with an offsetting deduction
from gross income or as a credit for taxes paid to foreign governments. You
should consult your tax advisor regarding the appropriate treatment of foreign
taxes paid.

INDEPENDENT AUDITORS' REPORT
- --------------------------------------------------------------------------------

The Board of Directors and the Shareholders of
Old Westbury International Fund:

We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of Old Westbury International Fund as of October
31, 1997, the related statements of operations for the year then ended, and of
changes in net assets for each of the two years then ended and the financial
highlights for each of the four years then ended, and for the period October 22,
1993 (commencement of operations) to October 31, 1993. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at October
31, 1997 by correspondence with the custodian and brokers; where replies were
not received from brokers, we performed other auditing procedures. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Old Westbury
International Fund as of October 31, 1997, the results of its operations, the
changes in its net assets, and the financial highlights for the respective
stated periods, in conformity with generally accepted accounting principles.

DELOITTE & TOUCHE LLP

New York, New York
December 12, 1997

INVESTMENT ADVISOR:
Bessemer Trust Company, N.A.
630 Fifth Avenue
New York, NY 10111
(212) 708-9100

DISTRIBUTOR AND SHAREHOLDER
SERVICING AGENT:
Edgewood Services, Inc.
Federated Investors Tower
Pittsburgh, PA 15222-3779

TRANSFER AGENT:
Fundamental Shareholder Services, Inc.
11 West 25 Street, 7th Floor
New York, NY 10010-2001

ADMINISTRATOR:
Federated Administrative Services
Federated Investors Tower
Pittsburgh, PA 15222-3779

SHAREHOLDER SERVICING AGENT:
Bessemer Trust Company, N.A.
630 Fifth Avenue
New York, NY 10111
(212) 708-9100

INDEPENDENT AUDITORS:
Deloitte & Touche LLP
Two World Financial Center
New York, NY 10281-1414

Cusip 680414109
G01963-01 (12/97) 10281-1414

Mutual funds are not bank deposits or obligations, are not guaranteed by any
bank, and are not insured or guaranteed by the U.S. government, the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
government agency. Investment in mutual funds involves investment risks,
including possible loss of principal.

This report is authorized for distribution to prospective investors only when
preceded or accompanied by the Fund's prospectus.

OLD WESTBURY
GROWTH OPPORTUNITY
FUND

Annual Report
October 31, 1997

Bessmer Trust
-------------------
Investment Advisor

OLD WESTBURY GROWTH OPPORTUNITY FUND
INVESTMENT ADVISOR'S REPORT
November 1997
- --------------------------------------------------------------------------------

The total return of the Old Westbury Growth Opportunity Fund portfolio (the
"Portfolio") for its first eight months of operations ended October 31, 1997 was
18.5%,* before fees and expenses. This compares favorably to the return of the
Russell 2500 Index** which was 18.2% for the same period.

While the total return for the Portfolio is quite attractive, the return
came in a relatively short period--May through September. The stellar return
during this period resulted from investors recognizing the attractiveness and
the superior earnings growth rate of the small- and mid-cap stocks relative to
large-capitalization stocks represented by the S&P 500.** This fundamental
attractiveness of the small- and mid-cap sector remains since the growth rates
for these stocks should continue to be greater than those of the S&P 500. Events
in Asia of the past few months should increase the attractiveness of
smaller-capitalization stocks which are much less dependent on markets outside
North America in which to sell their products.

The stocks in which the Portfolio invests have had superior growth rates of
earnings not only relative to the S&P 500 but also compared to small- and
mid-cap securities as a class. For the quarter ended September 30, 1997, the
average increase in the earnings per share of the companies in the Portfolio was
43% while the median increase was 32%. Early indications are that the growth
rate for the December quarter should be similar to recent quarters.

- ------------------
* Performance quoted represents past performance and is not indicative of
future results. Investment return and principal value will fluctuate, so that
an investor's shares, when redeemed, may be worth more or less than their
original cost. The Portfolio's total return based on offering price for the
period was 12.89%.

** The Russell 2500 Index measures the performance of the 2,500 smallest
companies in the Russell 3,000 Index and represents approximately 23% of the
total market capitalization of the Russell 3000 Index. The S&P 500 is a
capitalization weighted index of 500 stocks designed to measure performance
of the broad domestic economy through changes in the aggregate market value
of 500 stocks representing all major industries. These indices are unmanaged,
and investments cannot be made in an index.

OLD WESTBURY GROWTH OPPORTUNITY FUND
INVESTMENT ADVISOR'S REPORT
November 1997 (Continued)
- --------------------------------------------------------------------------------

The Portfolio continues to be well diversified among most major sectors of
the equity market. Currently, the Technology and Energy sectors are out of
favor. Investors are selling their technology positions because of concerns
about the negative effects of the turmoil in Asia on product demand and the
pricing structure. With few exceptions, the technology companies in the
Portfolio should be relatively unaffected by events in Asia. Energy stocks,
especially oil drillers and service companies, had performed exceedingly well
until October. These stocks are now under pressure because of concerns about the
price of oil. While the concerns about El Nino and about greater oil exports
from Iraq have had a negative effect on prices, these effects are shorter-term
in nature. There does not appear to be any long-term fundamental problems facing
oil and gas drillers and service companies. The price of these stocks should
rise around the turn of the year when tax loss selling and Portfolio "window
dressing" abate.

We appreciate your support and confidence in our efforts. We will continue
to pursue investments in financially sound companies whose performance is
improving and where these improvements are not fully discounted in the price of
the stock. We wish you a happy and healthy New Year.

OLD WESTBURY GROWTH OPPORTUNITY FUND
INVESTMENT ADVISOR'S REPORT
November 1997 (Continued)
- --------------------------------------------------------------------------------

[CHART APPEARS HERE-SEE APPENDIX]

CUMULATIVE TOTAL RETURNS
FOR THE PERIOD ENDED OCTOBER 31, 1997+

<TABLE>
<CAPTION>
SINCE
OLD WESTBURY GROWTH OPPORTUNITY FUND INCEPTION**
<S> <C>
Without sales charge............................................. 18.20%
With 4.5% sales charge........................................... 12.89%
</TABLE>
- ------------------
** February 28, 1997

The chart above illustrates the total value of a $10,000 investment from
inception (assuming a 4.5% sales charge) with dividends and capital gains
reinvested. The Russell 2500 Index includes the reinvestment of dividends and
capital gains, but does not include fees and expenses associated with an
investment in the Portfolio.

OLD WESTBURY GROWTH OPPORTUNITY FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SHARES VALUE
- --------- --------------------------------------------------------- --------------
<C> <S> <C>
COMMON STOCKS--97.0%

AIRLINES--2.5%
39,000 Southwest Airlines Co. $ 1,272,375
--------------

BASIC INDUSTRY--4.4%
29,000 (a)Newpark Resources, Inc. 1,203,500
28,000 OM Group, Inc. 1,057,000
--------------
TOTAL 2,260,500
--------------

CAPITAL GOODS--3.1%
64,000 Crompton & Knowles Corp. 1,616,000
--------------

CAPITAL GOODS-TECHNOLOGY--16.0%
11,000 (a)ADC Telecommunications, Inc. 364,375
31,000 (a)BDM International, Inc. 685,875
55,000 Comdisco, Inc. 1,735,937
29,000 (a)Computer Learning Centers, Inc. 1,312,250
18,000 (a)Digital Microwave Corp. 648,000
30,000 (a)J.D. Edwards & Co. 1,020,000
11,000 (a)McAfee Associates, Inc. 547,250
27,000 (a)P-Com, Inc. 543,375
24,000 (a)Sterling Commerce, Inc. 796,500
15,000 (a)Synopsys, Inc. 583,125
--------------
TOTAL 8,236,687
--------------

CONSUMER CYCLICAL--11.0%
49,000 Hudson Bay Company 1,131,037
33,000 (a)Promus Hotel Corporation 1,295,250
63,000 (a)Royal Group Techs Ltd. Sub. Vtg. 1,598,625
43,500 Unifi, Inc. 1,672,031
--------------
TOTAL 5,696,943
--------------

DEFENSIVE CONSUMER STAPLES--7.2%
76,000 Flowers Industries, Inc. 1,444,000
45,000 Hormel Foods Corp. 1,352,812
15,000 (a)Univision Communications, Inc., Class A 930,000
--------------
TOTAL 3,726,812
--------------
</TABLE>

See Footnotes on Page 6.

OLD WESTBURY GROWTH OPPORTUNITY FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SHARES VALUE
- --------- --------------------------------------------------------- --------------
<C> <S> <C>
COMMON STOCKS--continued
ENERGY--12.5%
27,000 Devon Energy Corp. Oklahoma $ 1,208,250
34,000 Ensco International, Inc. 1,430,125
34,000 (a)Noble Drilling Corp. 1,209,125
17,000 (a)Nuevo Energy Co. 704,438
91,500 (a)Santa Fe Energy Resources 1,195,219
9,000 (a)Smith International 686,250
--------------
TOTAL 6,433,407
--------------

FINANCIAL--13.3%
31,000 Financial Securities Assurance 1,348,500
37,000 Finova Group, Inc. 1,625,687
40,000 Penncorp Financial Group, Inc. 1,302,500
46,000 Provident Cos., Inc. 1,535,250
36,000 Western National Corp. 1,037,250
--------------
TOTAL 6,849,187
--------------

PRINTING-COMMERCIAL--1.8%
47,000 Southam, Inc. 939,666
--------------

PROFESSIONAL SERVICES--10.3%
46,000 (a)Atria Communities, Inc. 764,750
27,000 (a)Billing Information Concepts Corp. 1,059,750
38,000 (a)Health Care & Retirement 1,436,875
70,000 (a)Novacare, Inc. 914,375
17,000 Physio-Control International Corp. 270,938
23,000 (a)USA Waste Services, Inc. 851,000
--------------
TOTAL 5,297,688
--------------

RETAIL-OFFICE SUPPLIES--10.3%
44,000 (a)Borders Group, Inc. 1,141,250
62,000 Casey's General Stores, Inc. 1,495,750
52,100 (a)Corporate Express 765,219
52,000 (a)Dominick's Supermarkets, Inc. 1,898,000
--------------
TOTAL 5,300,219
--------------
</TABLE>

See Footnotes on Page 6.

OLD WESTBURY GROWTH OPPORTUNITY FUND
PORTFOLIO OF INVESTMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SHARES VALUE
- --------- --------------------------------------------------------- --------------
<C> <S> <C>
COMMON STOCKS--continued
TECHNOLOGY--3.6%
28,000 (a)Burr Brown Corp. $ 847,000
46,000 (a)Innova Corp. 989,000
--------------
TOTAL 1,836,000
--------------

TELECOMMUNICATION--1.0%
38,000 (a)Vanguard Cellular Systems, Inc. 524,875
--------------
TOTAL INVESTMENTS
(Identified Cost $48,840,937)(b) $ 49,990,359
--------------
CASH AND OTHER ASSETS
NET OF LIABILITIES--3.0% 1,537,391
--------------
NET ASSETS--100% $ 51,527,750
==============
</TABLE>

- ------------------
(a) Non-income producing security.

(b) At October 31, 1997, the cost of investments for federal income tax purposes
was substantially the same as the cost for financial reporting purposes. The
aggregate gross unrealized appreciation of investments amounts to $2,294,766
and the aggregate gross unrealized depreciation was $1,145,344, resulting in
net unrealized appreciation of $1,149,422.

Note: The categories of investments are shown as a percentage of net assets
($51,527,750) at October 31, 1997.

See Notes to Financial Statements.

OLD WESTBURY GROWTH OPPORTUNITY FUND
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
ASSETS:
Investments at market value (identified cost $48,840,937)......... $ 49,990,359
Cash.............................................................. 5,224,845
Receivable for fund shares sold................................... 915,000
Accrued income receivable......................................... 29,418
Deferred organization expenses.................................... 25,329
--------------
Total assets................................................ 56,184,951
--------------
LIABILITIES:
Operating expenses payable........................................ 99,828
Payable for investments purchased................................. 4,557,373
--------------
Total liabilities........................................... 4,657,201
--------------
NET ASSETS APPLICABLE TO 4,360,895 SHARES OF
CAPITAL STOCK OUTSTANDING......................................... $ 51,527,750
==============
Net Assets Consist of:
Paid in capital................................................... $ 50,848,835
Accumulated net investment loss................................... (80,958)
Accumulated net realized loss on investments...................... (389,549)
Net unealized appreciation on investments......................... 1,149,422
--------------
NET ASSETS.......................................................... $ 51,527,750
==============
NET ASSET VALUE, AND REDEMPTION PROCEEDS PER SHARE
($51,527,750 / 4,360,895 SHARES OF CAPITAL STOCK OUTSTANDING)..... $11.82
MAXIMUM OFFERING PRICE PER SHARE ($11.82 / .955).................... $12.38
</TABLE>

See Notes to Financial Statements.

OLD WESTBURY GROWTH OPPORTUNITY FUND
STATEMENT OF OPERATIONS
For the Period Ended October 31, 1997(a)
- --------------------------------------------------------------------------------

<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends............................................. $ 43,319
Interest.............................................. 29,693
-------------
Total income.................................... $ 73,012
-----------
EXPENSES:
Investment advisory................................... 82,117
Custody............................................... 20,536
Administration........................................ 15,397
Shareholder servicing................................. 25,670
Registration.......................................... 23,679
Amortization of organization costs.................... 4,472
Distribution.......................................... 4,150
Printing and postage.................................. 6,091
Legal................................................. 17,700
Audit................................................. 35,000
Transfer agent........................................ 20,650
Directors............................................. 8,625
Miscellaneous......................................... 998
-------------
Total expenses.................................. 265,085
Less fees waived and reimbursed:
Waiver of investment advisory fee..................... (82,117)
Waiver of administration fee.......................... (2,533)
Reimbursement of other operating expenses............. (26,465)
-------------
Total waivers...................................... (111,115)
-------------
Net expenses.................................... 153,970
-----------
NET INVESTMENT LOSS..................................... (80,958)
-----------
NET REALIZED AND UNREALIZED GAIN/(LOSS):
Net realized loss on investments...................... (389,549)
Net unrealized appreciation on investments............ 1,149,422
-------------
NET REALIZED AND UNREALIZED GAIN........................ 759,873
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.... $ 678,915
===========
</TABLE>
- ------------------
(a) For the period February 28, 1997 (commencement of operations) to October 31,
1997

See Notes to Financial Statements.

OLD WESTBURY GROWTH OPPORTUNITY FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
PERIOD ENDED
OCTOBER 31,
1997(A)
<S> <C>
FROM OPERATIONS:
Net investment loss........................................... $ (80,958)
Net realized loss on investments.............................. (389,549)
Net unrealized appreciation on investments.................... 1,149,422
------------------
Net increase in net assets from operations.................... 678,915
------------------
FROM CAPITAL STOCK TRANSACTIONS:
Net proceeds from sale of capital stock....................... 50,921,316
Reinvestment of dividends..................................... --
Net cost of capital stock redeemed............................ (72,481)
------------------
Net increase in net assets resulting from capital
stock transactions......................................... 50,848,835
------------------
NET INCREASE IN NET ASSETS.................................... 51,527,750
------------------
NET ASSETS:
Beginning of period........................................... --
------------------
End of period................................................. $ 51,527,750
==================
</TABLE>

- ------------------
(a) For the period February 28, 1997 (commencement of operations) to October 31,
1997

See Notes to Financial Statements.

OLD WESTBURY GROWTH OPPORTUNITY FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(For a share outstanding throughout the period)

<TABLE>
<CAPTION>
FOR THE
PERIOD
ENDED
OCTOBER 31,
1997(A)
<S> <C>
Net asset value, beginning of period.................................. $ 10.00
Income from investment operations:
Net investment loss................................................. (0.06)
Net realized and unrealized gain on investments..................... 1.88
------------
Total from investment operations.................................... 1.82
------------
Net asset value, end of period........................................ $ 11.82
============
Total return*....................................................... 18.2%

Ratios/Supplemental data:
Net assets, end of period (in 000's)................................ $ 51,528
Ratio of expense to average net assets before waiver of expenses.... 2.58%**
Ratio of expense to average net assets.............................. 1.50%**
Ratio of net investment loss to average net assets.................. (0.79%)**
Portfolio turnover.................................................. 46%
Average Commission rate paid........................................ 0.141
</TABLE>

- ------------------
* Total return is calculated without a sales charge assuming a purchase of
shares on the first day and a sale on the last day of the period.
** Annualized.
(a) For the period from February 28, 1997 (commencement of operations) to
October 31, 1997.

Note: Per share values calculated using average shares outstanding.

See Notes to Financial Statements.

OLD WESTBURY GROWTH OPPORTUNITY FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1997
- --------------------------------------------------------------------------------

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES. Old Westbury Growth
Opportunity Fund (the "Portfolio") is a separate series of Old Westbury Funds,
Inc. (the "Fund"), a Maryland corporation registered under the Investment
Company Act of 1940 (the "Act"), as a diversified, open-end management
investment company. The Fund's Articles of Incorporation permit the Directors to
create an unlimited number of series, each of which is a separate class of
shares. At October 31, 1997, the Fund consisted of the Portfolio and Old
Westbury International Fund. The Fund was incorporated under the laws of the
state of Maryland on August 26, 1993 and commenced operations on October 22,
1993. The Portfolio's investment objective is to seek capital appreciation.

The following is a summary of the significant accounting policies followed
by the Portfolio:

OLD WESTBURY GROWTH OPPORTUNITY FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

B. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME. Security
transactions are accounted for on the trade date. Realized gains and losses on
security transactions are determined on the specific identification cost method.
Dividend income and other distributions from portfolio securities are recorded
on the ex-dividend date. Interest income is accrued daily.

C. FEDERAL TAXES. It is the Portfolio's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income or excise tax provision is required.

At October 31, 1997, Old Westbury Growth Opportunity Fund, for federal
income tax purposes, had a capital loss carryforward of $367,778, which will
expire in the year 2005. The capital loss carryforward will reduce the Fund's
taxable income arising from future net realized gains on investments, if any, to
the extent permitted by the Code, and thus will reduce the amount of the
distributions to shareholders which would otherwise be necessary to relieve the
Fund of any liability for federal tax.

D. DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS. The Portfolio anticipates
paying income dividends on an annual basis. Capital gains distributions, if any,
will be made on an annual basis. The treatment for financial statement purposes
of distributions made during the year from net investment income or net realized
gains may differ from their ultimate treatment for federal income tax purposes.
These differences are caused primarily by: differences in the timing of the
recognition of certain components of income, expense, and capital gain.Where
such differences are permanent in nature, they are reclassified in the
components of net assets based on their characterization for federal income tax
purposes. Any such reclassifications will have no effect on net assets, results
of operations or net asset value per share of the Portfolio.

2. TRANSACTIONS WITH AFFILIATES.

A. INVESTMENT ADVISORY FEES. Pursuant to an advisory contract, dated August
8, 1996, the Fund has approved Bessemer to make investment decisions for the
Portfolio. The investment advisory fee paid to the advisor is computed daily and
paid monthly in accordance with the following schedule: 0.80% of the first $100
million of the Portfolio's average net assets, 0.75% of the second $100 million
of such assets and 0.70% of such assets exceeding $200 million.

OLD WESTBURY GROWTH OPPORTUNITY FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

C. DISTRIBUTION AND SERVICE PLAN AND DISTRIBUTION REIMBURSEMENT FEES. The
Directors adopted a distribution and service plan (the "Plan") for the Portfolio
pursuant to Rule 12b-1 of the Act, and pursuant to the Plan, the Portfolio
entered into a distribution agreement and a shareholder servicing agreement with
Edgewood Services, Inc. and a shareholder servicing agreement with Bessemer.
Under its shareholder servicing agreement, Edgewood Services, Inc. receives
payments from the Portfolio to permit it to make payments to broker-dealers for
providing shareholder services. Under its shareholder servicing agreement,
Bessemer is permitted (i) to receive a payment from the portfolio attributable
to Bessemer's clients (and its affiliates) for providing shareholder services to
such clients and (ii) to receive payments to permit it to make payments to other
financial institutions as shareholder servicing agents. The total of shareholder
servicing fees in the aggregate payable to Edgewood Services, Inc. and Bessemer
did not exceed 0.25% per annum of the Portfolio's average daily net assets.

The distribution agreement with Edgewood Services, Inc. provided for
reimbursement to Edgewood Services, Inc. by the Portfolio for its distribution,
promotional and advertising costs incurred in connection with the distribution
of the Portfolio's shares in an amount not to exceed 0.10% per annum of the
Portfolio's average daily net assets.

OLD WESTBURY GROWTH OPPORTUNITY FUND
NOTES TO FINANCIAL STATEMENTS
October 31, 1997 (Continued)
- --------------------------------------------------------------------------------

In addition, the Portfolio will pay for certain other expenses under the
Plan. These expenses shall not exceed an amount equal to 0.05% per annum of the
Portfolio's average daily net assets.

3. CAPITAL STOCK. The Fund has authorized a total of 20 billion shares of common
stock (par value $0.001 per share) of which the Portfolio is permitted to issue
4 billion. Transactions in shares of capital stock were as follows:

<TABLE>
<CAPTION>
FOR THE
PERIOD ENDED
OCTOBER 31,
1997(A)
<S> <C>
Common stock sold..................................................... 4,366,770
Reinvestment of dividends............................................. --
Common stock redeemed................................................. (5,875)
------------
Net increase.......................................................... 4,360,895
============
</TABLE>

- ------------------
(a) For the period February 28, 1997 (commencement of operations) to October 31,
1997.

4. PURCHASE AND SALES OF SECURITIES. For the period ended October 31, 1997,
purchases and sales of investment securities other than short-term investments
aggregated $56,498,728 and $7,268,238 respectively.

5. SUBSEQUENT EVENT. Effective November 13, 1997, the Directors of the Old
Westbury Growth Opportunity Fund approved the reduction of the custody fee to
0.15% of the average daily net assets of the Portfolio.

INDEPENDENT AUDITORS' REPORT
- --------------------------------------------------------------------------------

The Board of Directors and the Shareholders,
Old Westbury Growth Opportunity Fund

We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of Old Westbury Growth Opportunity Fund as of
October 31, 1997, the related statements of operations and of changes in net
assets, and the financial highlights for the period from February 28, 1997
(commencement of operations) to October 31, 1997. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and financial highlights are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of October 31, 1997, by
correspondence with the Fund's custodian and brokers; where replies were not
received from brokers, we performed other auditing procedures. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Old Westbury Growth
Opportunity Fund as of October 31, 1997, the results of its operations, the
changes in its net assets, and the financial highlights for the respective
stated period in conformity with generally accepted accounting principles.

DELOITTE & TOUCHE LLP

New York, New York
December 12, 1997

INVESTMENT ADVISOR:
Bessemer Trust Company, N.A.
630 Fifth Avenue
New York, NY 10111
(212) 708-9100

DISTRIBUTOR AND SHAREHOLDER
SERVICING AGENT:
Edgewood Services, Inc.
Federated Investors Tower
Pittsburgh, PA 15222-3779

TRANSFER AGENT:
Fundamental Shareholder Services, Inc.
11 West 25th Street--7th Floor
New York, NY 10010-2001

ADMINISTRATOR:
Federated Administrative Services
Federated Investors Tower
Pittsburgh, PA 15222-3779

SHAREHOLDER SERVICING AGENT:
Bessemer Trust Company, N.A.
630 Fifth Avenue
New York, NY 10111
(212) 708-9100

INDEPENDENT AUDITORS:
Deloitte & Touche LLP
Two World Financial Center
New York, NY 10281-1414

Cusip 680414208
G01963-04 (12/97)

This report is authorized for distribution to prospective investors only when
preceded or accompanied by the Fund's prospectus.

APPENDIX

OLD WESTBURY INTERNATIONAL FUND

The graphic representation here displayed consists of a boxed legend at the top
of the graph indicating the components of the corresponding line-graph. The
solid black line represents the total value of a $10,000 investment of the Old
Westbury International Fund (the "Portfolio"). The dashed black line represents
the total value of a $10,000 investment of the Morgan Stanley Capital
International: Europe Australia and Far East ("EAFE") Index. The dotted line
represents the total value of a $10,000 investment of the Morgan Stanley Capital
International Emerging Markets Free ("EMF") Index. The line graph is a shows
that an initial investment of $10,000 (assuming a 4.5% sales charge) in the Fund
on 10/22/93, would have a reinvested total worth of $11,621 on 10/31/97 as
compared to $12,669 for the EAFE Index and $10,157 for the EMF Index for the
same period. The "x" axis reflects annual computation periods from 10/22/93 to
10/31/97. The "y" axis of the chart reflects the beginning values of a
hypothetical investments measured in increments of $1,000 ranging from $9,000 to
$14,000.

OLD WESTBURY GROWTH OPPORTUNITY FUND

The graphic representation here displayed consists of a boxed legend at the top
of the graph indicating the components of the corresponding line-graph. The
solid black line represents the total value of a $10,000 investment in the Old
Westbury Growth Opportunity Fund (the "Portfolio"). The dashed black line
represents the total value of a $10,000 investment in the Russell 2500 Index.
The line graph is a shows that an initial investment of $10,000 (assuming a 4.5%
sales charge) in the Fund on 10/22/93, would have a reinvested total worth of
$11,621 on 10/31/97 as compared to $111,820 for the Russell 2500 Index for the
same period. The "x" axis reflects annual computation period from 2/28/97 to
10/31/97. The "y" axis of the chart reflects the beginning values of a
hypothetical investments measured in increments of $1,000 ranging from $9,000 to
$14,000.