<PAGE> 1
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- --------------------------------------------------------------------------------
President's Letter
Dear Shareholder:
Remarkably strong financial markets made the Chubb Heritage Series' inaugural
year one to remember.
Favorable economic conditions, including falling interest rates and low
inflation, sparked exceptional returns across virtually all market sectors. This
environment, coupled with the asset management expertise of Morgan Guaranty
Trust Company of New York, produced especially strong returns in the Chubb
Series Trust's domestic stock and fixed income portfolios. Later in this annual
report, our portfolio managers provide insights into the factors behind each
fund's returns.
To this, Chubb Life Insurance Company of America added its considerable risk
management experience, which includes a decade-long commitment to the variable
universal life marketplace. Further, it also contributed the prestige of a AAA
claims-paying ability rating. The result has been a powerful personal, estate
and business planning tool which offers the death benefit protection and
favorable tax treatment of variable universal life.
In 1996, we will seek new ways to add to the considerable advantages offered by
the Chubb Heritage alliance, and we welcome your comments and suggestions. All
of us at Chubb and at Morgan look forward to a continued prosperous
relationship.
Sincerely,
/s/ Ronald Angarella
- --------------------
Ronald Angarella
President
Chubb Series Trust
February 7, 1996
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RESOLUTE TREASURY MONEY MARKET PORTFOLIO
PORTFOLIO FACTS
INCEPTION DATE
January 3, 1995
FUND MANAGER
Morgan Guaranty Trust Co. of New York
INVESTMENT OBJECTIVE AND STRATEGY
The Resolute Treasury Money Market
Portfolio's investment objective is to provide
current income, maintain a high level of
liquidity and preserve capital. The Portfolio
will invest in Treasury Bills, Notes and
Bonds, all of which are backed as to principal
and interest payments by the full faith and
credit of the United States of America.
NET ASSETS AS OF 12/31/95
$1,272,932
NUMBER OF HOLDINGS
3
PORTFOLIO QUALITY
AAA-100%
DOLLAR WEIGHTED AVERAGE MATURITY
73.3 DAYS
IN THIS SECTION
Portfolio Facts
Advisor's Investment Review
Portfolio Composition
Schedule of Portfolio Investments
1
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RESOLUTE TREASURY MONEY MARKET PORTFOLIO
PORTFOLIO COMPOSITION
LIST OF TOP HOLDINGS
PERCENT OF
TOTAL INVESTMENTS
U.S. Treasury Bill, 4.910%, due 03/14/96 95.37%
U.S. Treasury Bill, 5.205%, due 03/21/96 3.04
U.S. Treasury Bill, 5.285%, due 03/21/96 1.59
-------------------------------------------------------------------
TOTAL 100.00%
2
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RESOLUTE TREASURY MONEY MARKET PORTFOLIO
ADVISOR'S INVESTMENT REVIEW
12-MONTH PERIOD ENDED DECEMBER 31, 1995
MARKET REVIEW: In 1995, the Federal Reserve lowered interest rates twice,
trimming them by a quarter-percentage point in July and December. Since money
market funds invest in short-term debt, yields rise and fall along with
short-term interest rates controlled by the Federal Reserve. At the same time,
the bond market enjoyed one of its best-performing years on record, causing
long-term interest rates to decline. As a result, the yield curve flattened and
then inverted, which means that yields on shorter maturities became higher than
those with longer maturities. This condition persisted throughout most of the
year and was the result of a slowing economy, speculation over further Fed
easings, continued low inflation and weakening of manufacturing statistics.
PORTFOLIO REVIEW: The Portfolio returned 5.09% for the calendar year ended
December 31, 1995. Morgan systematically draws upon proprietary economic
research in order to control the Fund's maturity structure. Our portfolio
managers actively allocate the Portfolio's investment among Treasury securities
and repurchase agreements in order to increase the potential for achieving
higher returns. During the period, we managed the Portfolio's duration around
our interest rate outlook. For example, as rates were rising, we positioned the
Portfolio defensively with a short target average life of 30 days relative to
its benchmark. As rates began to stabilize, we gradually lengthened the
Portfolio's maturity target in order to take advantage of higher interest rates.
The Portfolio invests only in Treasury Bills and Notes, all of which are backed
as to principal and interest payments by the full faith and credit of the United
States of America.
PORTFOLIO OUTLOOK: A credible budget package and continued favorable inflation
data could allow the Federal Reserve to reduce short-term rates again in the
near-term. Given our view that rates will either be reduced or held steady over
the next few months, we expect the Portfolio to maintain a slightly longer
average maturity than that of its IBC/Donoghue peer group.
3
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CHUBB SERIES TRUST
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RESOLUTE TREASURY MONEY MARKET PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS
SHORT-TERM OBLIGATIONS-107.27%
<TABLE>
<CAPTION>
Principal Market Value
U.S. Treasury Bills Amount (Note B)
--------- ------------
<S> <C> <C>
4.910%, due 03/14/96 $1,315,000 $1,302,112
5.205%, due 03/21/96 42,000 41,549
5.285%, due 03/21/96 22,000 21,764
----------
TOTAL SHORT-TERM OBLIGATIONS
(Cost $1,364,786) $1,365,425
----------
</TABLE>
SUMMARY OF TOTAL NET ASSETS
<TABLE>
<CAPTION>
Market Value
(Note B)
------------
TOTAL INVESTMENTS
<S> <C> <C>
(Cost $1,364,786)* 107.27% $1,365,425
Other assets, less liabilities (7.27) (92,493)
------ ----------
TOTAL NET ASSETS 100.00% $1,272,932
====== ==========
</TABLE>
*Aggregate cost for Federal income tax purposes.
See notes to financial statements.
4
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RESOLUTE BOND PORTFOLIO
PORTFOLIO FACTS
INCEPTION DATE
January 3, 1995
FUND MANAGER
Morgan Guaranty Trust Co. of New York
INVESTMENT OBJECTIVE AND STRATEGY
To provide a high total return consistent
with moderate risk of capital and
maintenance of liquidity. Total return
will consist of income plus realized and
unrealized capital gains and losses.
NET ASSETS AS OF 12/31/95
$1,416,694
NUMBER OF HOLDINGS
20
PORTFOLIO TURNOVER
238.96%
PORTFOLIO QUALITY
AAA - 67.86%
AA - 4.19%
A - 20.88%
BBB - 7.07%
AVERAGE MATURITY
12.10 years
IN THIS SECTION
Portfolio Facts
Investment Comparison
Advisor's Investment Review
Portfolio Composition
Schedule of Portfolio Investments
5
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RESOLUTE BOND PORTFOLIO
INVESTMENT COMPARISON
[GRAPH SHOWING RESOLUTE BOND PORTFOLIO AND
THE SALOMON INVESTMENT GRADE BOND INDEX -
CLIENT TO SUPPLY DESCRIPTION]
Past performance is not predictive of future performance.
This graph compares an initial $10,000 investment made in the Resolute Bond
Portfolio at its inception with a similar investment in the Salomon Investment
Grade Bond Index. For the purpose of this graph and the accompanying table, the
total return for the Portfolio reflects all recurring expenses (advisory fees,
account fees) and includes the reinvestment of all dividends and distributions.
Shares of the Portfolio are offered only through divisions of Chubb Separate
Account C established by Chubb Life Insurance Company of America to fund
flexible premium variable life insurance policies. Total returns do not reflect
any separate account expenses imposed on the policies which include a 3% sales
charge, 2.5% premium tax charge, DAC tax sales charge, cost of insurance,
mortality expenses and surrender charges.
The Salomon Investment Grade Bond Index is an unmanaged index and includes the
reinvestment of all dividends, but does not reflect the payment of transaction
costs, advisory fees or expenses that are associated with an investment in the
Portfolio.
6
<PAGE> 9
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RESOLUTE BOND PORTFOLIO
ADVISOR'S INVESTMENT REVIEW
12-MONTH PERIOD ENDED DECEMBER 31, 1995
MARKET REVIEW: After declining dramatically in 1994, the bond market had one of
its best years on record in 1995, with most bonds showing total returns of
16-20% and the bellwether 30-year Treasury producing a return of over 30%. The
primary catalyst behind this strong performance was a big decline in interest
rates caused by benign inflation reports, weak economic growth, and expectations
for interest rate easings by the Federal Reserve.
Early in the year, as the Federal Reserve continued to raise short-term interest
rates on inflationary fears and signs that the economy was growing rapidly,
yields on Treasuries rose. However, as the economy began to show signs of
weakness and it became clear that additional rate increases were unlikely,
Treasury yields declined and bond prices rose.
During the second half of the year, the Federal Reserve lowered interest rates
twice, trimming them by a quarter-percentage point in July and December. This,
in turn, further fueled the bond market's rally: intermediate-term bonds (based
on the Salomon Investment Grade Bond Index) ended the year with a yield of
5.94%, down from 8.22% at the beginning of 1995, while the long bond closed out
the year with a yield of 5.94% vs. 7.88% at the beginning of the year.
PORTFOLIO REVIEW: The Portfolio provided a total return of 16.85% for the year
ended December 31, 1995. Our investment process involves three key decisions:
duration management, sector allocation, and security selection. By making
decisions based upon these multiple, unrelated investment insights, we seek to
diversify the ways we can add value to the Portfolio.
Duration management: Duration is the measure of a fund's sensitivity to interest
rate changes, which is closely related to the average maturity of the bonds in a
portfolio. During the first quarter, we maintained a defensive strategy by
keeping the Portfolio's maturity short, a move which slightly hurt performance
as the bond market began to rally. As interest rates began to change direction,
however, we lengthened to a slightly long duration position, a strategy which
added value throughout the remainder of the year.
Sector allocation: During the period, we actively managed the Portfolio's
allocation to Treasuries, corporates, and mortgages based on their relative
attractiveness. In early 1995, we decreased our allocation to "spread" products
such as corporates and mortgages (they are called spread products because their
yields are higher than those of Treasuries) due to expectations that yield
spreads would widen and that these sectors would underperform.
In the second half of the year, we overweighted corporate bonds, on expectations
that their yield spreads relative to Treasuries would remain stable. In
addition, we moved from an underweighted position in mortgages to "neutral"
relative to the index in order to take advantage of attractive valuations in
that sector and capture additional yield.
Security selection: Security selection added value to performance during this
period. The Portfolio maintained its focus on high-quality issues, keeping the
average quality of its holdings between AA and AAA.
PORTFOLIO OUTLOOK: It is very unlikely that the stellar bond market returns of
1995 will be repeatable in 1996. We continue to be cautiously optimistic, given
continued weaker economic data, a positive inflation environment and secular
factors, including credible deficit reduction talk in Washington. As a result,
we continue to manage the Portfolio's duration slightly longer than the index.
In addition, we continue to overweight corporates and mortgages in order to take
advantage of their higher yields relative to Treasuries.
7
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RESOLUTE BOND PORTFOLIO
PORTFOLIO COMPOSITION
[PIE CHART - CLIENT WILL PROVIDE DESCRIPTIONS ON GRAPHICS]
LIST OF TOP TEN LONG-TERM HOLDINGS
<TABLE>
<CAPTION>
PERCENT OF
TOTAL INVESTMENTS
<S> <C>
U.S. Treasury Bond, 9.250%, due 02/15/16 13.79%
Federal Home Loan Mortgage Corporation, 7.000%, due 11/01/25 8.68
U.S. Treasury Note, 7.500%, due 11/15/01 7.37
U.S. Treasury Bond, 12.000%, due 08/15/13 6.19
U.S. Treasury Note, 5.750%, due 08/15/03 6.09
U.S. Treasury Note, 6.500%, due 04/30/99 5.89
U.S. Treasury Note, 7.750%, due 11/30/99 5.80
Access Financial, 6.375%, due 05/15/21 4.72
Greentree Financial Corp., 7.200%, due 04/15/19 4.19
Continental Bank, N.A., Sub Notes, 7.875%, due 02/01/03 4.04
Balance - 10 Security Positions 33.24
- --------------------------------------------------------------------------------
TOTAL 100.00%
</TABLE>
8
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RESOLUTE BOND PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS
CORPORATE BONDS--38.92%
<TABLE>
<CAPTION>
PRINCIPAL MARKET VALUE
COMPANY AMOUNT (NOTE B)
- ------- --------- ------------
<S> <C> <C>
BANKING--4.26%
Continental Bank, N.A.,
Sub Notes, 7.875%,
due 02/01/03 $ 55,000 $ 60,388
--------
ELECTRONICS--3.66%
Phillips Electronics,
6.750%, due 08/15/03 50,000 51,855
FINANCIAL SERVICES--23.35%
Access Financial MHL,
6.375%, due 05/15/21 70,000 70,601
Chrysler Financial Corp.,
8.125%, due 12/15/96 50,000 51,148
Ford Motor Credit Co.,
5.625%, due 03/23/97 55,000 55,087
GMAC Medium Term Note,
5.700%, due 12/22/97 40,000 40,081
Greentree Financial Corp.,
7.200%, due 04/15/19 60,000 62,716
Premier Auto Trust,
4.65%, due 11/02/99 51,696 51,155
--------
Total 330,788
--------
UTILITIES - ELECTRIC--7.65%
Pacific Gas & Electric Co.,
7.875%, due 03/01/02 50,000 54,494
Texas Utilities Electric Co.,
1st Mortgage, 7.875%,
due 04/01/24 50,000 53,943
--------
Total 108,437
--------
TOTAL CORPORATE BONDS
(Cost $524,190) $551,468
--------
U.S. GOVERNMENT AND AGENCY
OBLIGATIONS--59.61%
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL MARKET VALUE
AGENCY AMOUNT (NOTE B)
- ------ --------- ------------
<S> <C> <C>
Federal Home Loan
Mortgage Corporation,
7.000%, due 11/01/25 $128,607 129,893
--------
U.S. Treasury Bonds
12.000%, due 08/15/13 60,000 92,625
9.250%, due 02/15/16 150,000 206,344
--------
Total 298,969
--------
U.S. Treasury Notes
4.750%, due 10/31/98 40,000 39,475
6.500%, due 04/30/99 85,000 88,134
7.750%, due 11/30/99 80,000 86,700
7.500%, due 11/15/01 100,000 110,250
5.750%, due 08/15/03 90,000 91,125
--------
Total 415,684
--------
TOTAL U.S. GOVERNMENT AND AGENCY
OBLIGATIONS
(Cost $778,339) $844,546
--------
</TABLE>
See notes to Financial Statements.
9
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RESOLUTE BOND PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
SHORT-TERM OBLIGATIONS--7.06%
<TABLE>
<CAPTION>
PRINCIPAL MARKET VALUE
U.S. TREASURY BILLS AMOUNT (NOTE B)
- ------------------- --------- ------------
<S> <C> <C>
4.970%, due 03/14/96 $ 88,000 $ 87,132
5.285%, due 03/21/96 13,000 12,861
---------
TOTAL SHORT-TERM OBLIGATIONS
(Cost $99,932) $ 99,993
---------
SUMMARY OF TOTAL NET ASSETS
TOTAL INVESTMENTS
MARKET VALUE
U.S. TREASURY BILLS (NOTE B)
- ------------------- ------------
(Cost $1,402,461)* 105.59% $1,496,007
Other assets, less liabilities (5.59) (79,313)
------ ----------
TOTAL NET ASSETS 100.00% $1,416,694
====== ==========
</TABLE>
*Aggregate cost for Federal income tax purposes.
10
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- --------------------------------------------------------------------------------
RESOLUTE EQUITY PORTFOLIO
PORTFOLIO FACTS
INCEPTION DATE
January 3, 1995
FUND MANAGER
Morgan Guaranty Trust Co. of New York
INVESTMENT OBJECTIVE AND STRATEGY
To provide a high total return from a
portfolio comprised of selected
equity securities.
Portfolio invests primarily in the common
stock of large and medium sized U.S.
corporations with market capitalization
above $1.5 billion.
NET ASSETS AS OF 12/31/95
$4,144,458
NUMBER OF HOLDINGS
98
PORTFOLIO TURNOVER
65.60%
IN THIS SECTION
Portfolio Facts
Investment Comparison
Advisor's Investment Review
Portfolio Composition
Schedule of Portfolio Investments
11
<PAGE> 14
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- --------------------------------------------------------------------------------
RESOLUTE EQUITY PORTFOLIO
[GRAPH - RESOLUTE EQUITY PORTFOLIO AND THE S&P 500 INDEX -
CUSTOMER SUPPLIED COPY TO COME]
Past performance is not predictive of future performance.
This graph compares an initial $10,000 investment made in the Resolute Equity
Portfolio at its inception with a similar investment in the S&P 500 Index. For
the purpose of this graph and the accompanying table, the total return for the
Portfolio reflects all recurring expenses (advisory fees, account fees) and
includes the reinvestment of all dividends and distributions.
Shares of the Portfolio are offered only through divisions of Chubb Separate
Account C established by Chubb Life Insurance Company of America to fund
flexible premium variable life insurance policies. Total returns do not reflect
any separate account expenses imposed on the policies which include a 3% sales
charge, 2.5% premium tax charge, DAC tax sales charge, cost of insurance,
mortality expenses and surrender charges.
The S&P 500 Index is an unmanaged index and includes the reinvestment of all
dividends, but does not reflect the payment of transaction costs, advisory fees
or expenses that are associated with an investment in the Portfolio.
12
<PAGE> 15
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RESOLUTE EQUITY PORTFOLIO
ADVISOR'S INVESTMENT REVIEW
12-MONTH PERIOD ENDED DECEMBER 31, 1995
MARKET REVIEW: 1995 proved to be a banner year for large-cap equities. The S&P
500's return of 37.45% was the best since 1958 and the second best annual return
in post-war history. The end of the year saw a continuation of 1995's major
trends: a record level of mergers and acquisitions, strong corporate profits (as
a percent of GDP, they were the highest in more than 15 years), the lowest
inflation in 30 years, and a long bond yield approaching the lowest levels in 25
years.
Not only were equity returns impressive, they were achieved with extraordinary
low volatility. The largest decline the market suffered over any period during
the year was 2.5% (the smallest ever), while setting a new high every four days
on average during the year. 1995 was the fifth consecutive year without a 10%
correction: prior to the current bull market, U.S. stocks had never seen even
three straight years without a 10% fall. The market was characterized by high
returns with low risk, making it truly the best of all possible worlds for U.S.
stocks in 1995.
1995 also proved to be a very concentrated market, as the big multinational
companies that dominate the S&P 500 outperformed the smaller stocks that were
held by most stock funds. These huge corporations experienced a "flight to
quality" as a safe bet in a slowing economy. Returns were fueled by strong
corporate profits and booming exports, which tend to benefit large companies
more than smaller ones. Buying was momentum driven, with heavy concentration on
certain sectors of the market. Healthcare was one of the year's best performing
groups of the S&P 500, rising 58%, as the sector benefited from generally strong
earnings, ongoing industry consolidation, much improved productivity at the FDA
and the absence of pressure from meaningful Washington healthcare reformers.
Finance stocks were also strong for the year, advancing 59%, due to declining
interest rates and strong earnings.
Surprisingly, technology stocks finished the year in "tenth place" out of our 17
economic sectors due to the strong December sell-off (-5.5%) caused by fears
that earnings growth would begin to decelerate. Retail stocks were the clear
losers for 1995, only gaining 7.6%, reflecting the continuing fears that the
industry is "overstored" and that consumers have shifted their buying away from
softgoods into hardgoods and are demanding greater value and thus lower pricing.
PORTFOLIO REVIEW: The Portfolio provided a total return of 33.91% for the year
ended December 31, 1995. While it generated positive returns on an absolute
basis, it underperformed the S&P 500. Morgan's strategy of broad diversification
proved difficult in a market where returns were highly concentrated among the 50
largest stocks and on two primary sectors. This trend did not bode well for our
value-oriented approach to stock selection which seeks to identify companies
that are undervalued relative to our forecast of their long-term earnings and
dividend payouts. Many of the companies that we believe offer attractive
long-term value tend to be smaller than the large-cap names that dominate the
S&P 500.
13
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RESOLUTE EQUITY PORTFOLIO
ADVISOR'S INVESTMENT REVIEW (CONTINUED)
In addition, the uncertain economic environment for most of the year caused
investors to focus on near-term corporate earnings and to overpenalize companies
with near-term earnings disappointments. Our style, which focuses on longer-term
forecasts, is uniquely vulnerable during these periods since we are invariably
drawn to stocks that have underperformed due to near-term earnings
disappointments. Although this psychology of the market was not ideal for our
valuation approach, our experience indicates that these types of markets tend to
be short-lived.
Portfolio outlook: Market returns are expected to be lower in 1996 and we
believe that the U.S. equity market may experience some volatility in the coming
months. However, as the emotions that drove the markets and many stocks to
historical highs in 1995 begin to dissipate, superior stock selection will
become critical in producing good performance.
14
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RESOLUTE EQUITY PORTFOLIO
PORTFOLIO COMPOSITION
[PIE CHART - CLIENT WILL PROVIDE DESCRIPTIONS ON GRAPHICS]
LIST OF TOP TEN LONG-TERM HOLDINGS
<TABLE>
PERCENT OF
TOTAL INVESTMENTS
<S> <C>
General Motors Corporation 2.42%
General Electric Co. 2.30
Philip Morris Companies, Inc. 2.28
AT&T Corp. 2.22
Columbia/HCA Healthcare 2.20
Bausch & Lomb, Inc. 2.17
Texaco, Inc. 2.16
Providian Corp. 2.14
BankAmerica Corporation 2.07
NationsBank Corp. 2.07
Balance - 88 Security Positions 77.97
- ------------------------------------------------------------
TOTAL 100.00%
</TABLE>
15
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RESOLUTE EQUITY PORTFOLIO
PORTFOLIO COMPOSITION (CONTINUED)
LIST OF TOP TEN INDUSTRIES
<TABLE>
<CAPTION>
PERCENT OF
TOTAL INVESTMENTS
- -----------------------------------------------------------------
<S> <C>
Oil Production 8.79%
Banking 6.14
Telecommunications 5.86
Entertainment & Leisure 5.24
Consumer Products 5.16
Retail 4.98
Manufacturing 4.94
Health Supplies 4.90
Electronics 4.46
Financial Services 4.36
- ----------------------------------------------------------------
TOTAL 54.83%
</TABLE>
16
<PAGE> 19
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- --------------------------------------------------------------------------------
RESOLUTE EQUITY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS
COMMON STOCK--101.34%
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
AEROSPACE--0.28%
Coltec Industries, Inc.+ 1,000 $ 11,625
----------
AUTOMOTIVE--2.55%
General Motors Corporation 2,000 105,750
----------
AUTOMOTIVE PARTS & SERVICES--1.19%
Cooper Tire & Rubber Co. 2,000 49,250
----------
BANKING--6.48%
BankAmerica Corporation 1,400 90,650
First Union Corp. 400 22,250
Fleet Financial Group, Inc. 1,500 61,125
NationsBank Corp. 1,300 90,512
Standard Federal
Bancorporation 100 3,938
----------
Total 268,475
----------
CHEMICAL--4.03%
Du Pont (E.I.) De Nemours
& Company 900 62,888
Union Carbide Corp. 1,500 56,250
Wellman, Inc. 2,100 47,775
----------
Total 166,913
----------
COMPUTER - PERIPHERALS--1.76%
Bay Networks, Inc.+ 450 18,506
International Business
Machines Corporation 400 36,700
Quantum Corp.+ 1,100 17,738
----------
Total 72,944
----------
COMPUTER - SOFTWARE--2.04%
Autodesk, Inc. 800 27,400
Novell, Inc.+ 4,000 57,000
----------
Total 84,400
----------
CONSUMER PRODUCTS--5.45%
Nabisco Holdings Corp. 1,300 42,413
Pepsico, Inc. 1,500 83,812
Philip Morris Companies, Inc. 1,100 99,550
----------
Total 225,775
----------
ELECTRICAL EQUIPMENT--1.93%
General Instruments
Corporation+ 1,300 30,388
Grainger (W.W.), Inc. 700 46,375
Magnetek, Inc.+ 400 3,250
----------
Total 80,013
----------
ELECTRONICS--4.71%
General Electric Co. 1,400 100,800
Hewlett Packard, Co. 300 25,125
Motorola, Inc. 1,000 57,000
Xilinx, Inc.+ 400 12,200
----------
Total 195,125
----------
ENTERTAINMENT & LEISURE--5.53%
Circus Circus
Enterprises, Inc.+ 2,700 75,262
International Game
Technology 2,300 25,013
Tele-Communications,
Class A, ADR+ 4,400 87,450
Time Warner, Inc. 1,100 41,663
----------
Total 229,388
----------
FINANCIAL SERVICES--4.60%
AMBAC, Inc. 1,100 51,562
Dean Witter Discover & Co. 1,200 56,400
Firstar Corp. 800 31,700
Great Western Financial Corp. 2,000 51,000
----------
Total 190,662
----------
FOOD PROCESSING--2.98%
Archer-Daniels Midland Co. 2,400 43,200
CPC International, Inc. 500 34,312
General Mills, Inc. 800 46,200
----------
Total 123,712
----------
</TABLE>
See notes to financial statements
17
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RESOLUTE EQUITY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
COMMON STOCK (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
FOREST PRODUCTS & PAPER--0.77%
Buckeye Cellulose Corp.+ 500 $ 11,000
Mead Corp. 400 20,900
--------
Total 31,900
--------
FURNITURE & APPLIANCES--0.69%
Interco, Inc.+ 3,200 28,800
--------
HEALTH SUPPLIES--5.17%
Bausch & Lomb, Inc. 2,400 95,100
Columbia/HCA Healthcare 1,900 96,425
Forest Laboratories, Inc.+ 500 22,625
--------
Total 214,150
--------
HOME CONSTRUCTION--3.28%
Manville Corp.+ 3,500 45,938
Service Corp. International 1,500 66,000
USG Corp.+ 800 24,000
--------
Total 135,938
--------
HOUSEHOLD PRODUCTS--2.59%
Colgate Palmolive Co. 700 49,175
Procter & Gamble Co. 700 58,100
--------
Total 107,275
--------
INSURANCE--4.43%
Humana, Inc.+ 2,800 76,650
Providian Corp. 2,300 93,725
U.S. Life Corp. 450 13,444
--------
Total 183,819
--------
MANUFACTURING--5.22%
Allied Signal, Inc. 1,400 66,500
Cooper Industries, Inc. 1,747 64,202
Tyco International, Ltd. 2,400 85,500
--------
Total 216,202
--------
METAL & MINING--1.42%
Aluminum Company of
America 400 21,150
Freeport McMoRan Copper
and Gold, Class B 342 9,619
Freeport McMoRan Copper
and Gold, Class A 200 5,600
Reynolds Metals Co. 400 22,650
--------
Total 59,019
--------
OFFICE PRODUCTS--1.32%
Harris Corp. 1,000 54,625
--------
OIL - PRODUCTION--9.28%
Anadarko Petroleum Corp. 900 48,712
Chevron Corporation 800 42,000
Cooper Cameron Corp.+ 569 20,199
Diamond Shamrock, Inc. 1,400 36,225
Oryx Energy Company+ 900 12,038
Repsol, S.A., ADR 1,200 39,450
Royal Dutch Petroleum Co., ADR 300 42,337
Sun Company, Inc. 1,800 49,275
Texaco, Inc. 1,200 94,200
--------
Total 384,436
--------
PERSONAL CARE--0.12%
International Flavors &
Fragrances, Inc. 100 4,800
--------
PHARMACEUTICALS--3.20%
Alza Corp., Class A+ 900 22,275
Eli Lilly & Co. 1,100 61,875
Warner-Lambert Co. 500 48,562
--------
Total 132,712
--------
POLLUTION CONTROL--1.01%
Wheelabrator Technologies,
Inc. 2,500 41,875
--------
RESTAURANTS--0.66%
Cracker Barrel Old
Country Stores, Inc. 1,600 27,600
--------
</TABLE>
See notes to financial statements
18
<PAGE> 21
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE EQUITY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
COMMON STOCK (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
RETAIL--5.26%
Limited, Inc. 2,800 $ 48,650
Melville Corp. 1,300 39,975
Price/Costco, Inc.+ 3,200 48,800
Wal-Mart Stores, Inc. 3,600 80,550
----------
Total 217,975
----------
TELECOMMUNICATIONS--6.19%
AT&T Corp. 1,500 97,125
GTE Corp. 900 39,600
MCI Communications Corp. 1,200 31,350
Telefonos de Mexico,
S.A., ADR 500 15,937
U.S. West, Inc. 1,600 57,200
U.S. West Media Group+ 800 15,200
----------
Total 256,412
----------
TEXTILES--1.35%
Fruit of the Loom, Inc.,
Class A+ 2,300 56,063
----------
TRUCKING & FREIGHT CARRIERS--3.09%
Consolidated Freightways, Inc. 1,600 42,400
Union Pacific Corp. 1,300 85,800
----------
Total 128,200
----------
UTILITIES - ELECTRIC--2.76%
Entergy Corp. 1,700 49,725
Illinova Corp. 300 9,000
SCE Corp. 2,000 35,500
Western Resources, Inc. 600 20,025
----------
Total 114,250
----------
TOTAL COMMON STOCK
(Cost $3,810,309) $4,200,083
----------
<CAPTION>
SHORT-TERM OBLIGATIONS--4.22%
PRINCIPAL MARKET VALUE
U.S. TREASURY BILLS AMOUNT (NOTE B)
- ------------------- --------- ------------
<S> <C> <C>
5.405%, due 01/18/96 $ 14,000 $ 13,960
5.310%, due 03/07/96 10,000 9,913
4.970%, due 03/14/96 67,000 66,339
5.135%, due 03/21/96 36,000 35,614
5.185%, due 03/21/96 34,000 33,635
5.190%, due 03/21/96 3,000 2,968
5.030%, due 10/17/96 13,000 12,481
--------
TOTAL SHORT-TERM OBLIGATIONS
(Cost $174,778) $174,910
--------
<CAPTION>
SUMMARY OF TOTAL NET ASSETS
MARKET VALUE
(NOTE B)
------------
<S> <C> <C>
TOTAL INVESTMENTS
(Cost $3,985,087)* 105.56% $ 4,374,993
Other assets, less liabilities (5.56) (230,535)
------ -----------
TOTAL NET ASSETS 100.00% $ 4,144,458
====== ===========
</TABLE>
*Aggregate cost for Federal income tax purposes.
+Non-income producing security.
See notes to financial statements
19
<PAGE> 22
[This page intentionally left blank]
<PAGE> 23
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
PORTFOLIO FACTS
INCEPTION DATE
January 3, 1995
FUND MANAGER
Morgan Guaranty Trust Co. of New York
INVESTMENT OBJECTIVE AND STRATEGY
To provide a high total return from a
portfolio of equity securities of
small companies.
The Portfolio invests at least 65% of the
value of its total assets in the common
stock of small U.S. companies, primarily
with market capitalizations less than
$1.5 billion.
NET ASSETS AS OF 12/31/95
$2,536,258
NUMBER OF HOLDINGS
335
PORTFOLIO TURNOVER
100.43%
IN THIS SECTION
Portfolio Facts
Investment Comparison
Advisor's Investment Review
Portfolio Composition
Schedule of Portfolio Investments
21
<PAGE> 24
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
INVESTMENT COMPARISON
[GRAPH - RESOLUTE SMALL COMPANY PORTFOLIO AND THE RUSSELL 2500 INDEX -
CLIENT WILL PROVIDE DESCRIPTIONS ON GRAPHICS]
Past performance is not predictive of future performance.
This graph compares an initial $10,000 investment made in the Resolute Small
Company Portfolio at its inception with a similar investment in the Russell 2500
Index. For the purpose of this graph and the accompanying table, the average
annual total return for the Portfolio reflects all recurring expenses (advisory
fees, account fees) and includes the reinvestment of all dividends and
distributions.
Shares of the Portfolio are offered only through divisions of Chubb Separate
Account C established by Chubb Life Insurance Company of America to fund
flexible premium variable life insurance policies. Total returns do not reflect
any separate account expenses imposed on the policies which include a 3% sales
charge, 2.5% premium tax charge, DAC tax sales charge, cost of insurance,
mortality expenses and surrender charges.
The Russell 2500 Index is an unmanaged index and includes the reinvestment of
all dividends, but does not reflect the payment of transaction costs, advisory
fees or expenses that are associated with an investment in the Portfolio.
22
<PAGE> 25
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
ADVISOR'S INVESTMENT REVIEW
12-MONTH PERIOD ENDED DECEMBER 31, 1995
MARKET REVIEW: 1995 proved to be a strong year for U.S. small cap equities, with
the Russell 2500 rising 31.7%, the second best annual return in ten years. The
end of the year saw a continuation of 1995's major trends: a record level of
mergers and acquisitions, strong corporate profits (as a percent of GDP, they
were the highest in more than 15 years), the lowest inflation in 30 years, a
long bond yield approaching the lowest levels in 25 years, and an all-time
record flow of assets into mutual funds.
The market proved to be very concentrated throughout the year, as the big
multinational companies that dominate the S&P 500 outperformed the smaller
stocks. These huge corporations experienced a "flight to quality" as a safe bet
in a slowing economy. Their returns were fueled by strong corporate profits and
booming exports, which tend to benefit large companies more than smaller ones.
Buying was momentum-driven, with heavy concentration on certain sectors of the
market. Healthcare was one of the year's best performing groups of the S&P 500,
rising 58%, as the sector benefited from generally strong earnings, ongoing
industry consolidation, much improved productivity at the FDA and the absence of
pressure from meaningful Washington healthcare reforms. Finance stocks were also
strong for the year, advancing 59%, due to declining interest rates and strong
earnings. Technology stocks, which were the big winners during the first three
quarters of the year, experienced a fourth quarter sell-off but, nonetheless,
ended the year up 48%.
Retail stocks were the clear losers for 1995 only gaining 7.6%, reflecting the
continuing fears that the industry is "overstored" and that consumers have
shifted their buying away from softgoods into hardgoods and are demanding
greater value and, thus, lower pricing.
PORTFOLIO REVIEW: The Portfolio provided a total return of 32.91% for the year
ended December 31, 1995. Over this time period, the Portfolio significantly
outperformed the largest and highest-returning sectors of the Russell 2500,
including software, healthcare and finance due to strong stock selection. During
the year, some of the best performers included Security Dynamics Technology,
Quarterdeck Office Systems, and Consolidated Graphics. Shares of both Security
Dynamics and Quarterdeck surged last year with the widespread interest in the
Internet. Security Dynamics provides security systems and devices that protect
networked computer systems, including those linked to the Internet, from illicit
intruders. Quarterdeck benefited both from interest in its Internet software
products and from improved financial performance delivered by the new management
that joined the company in late 1994. Consolidated Graphics is a commercial
printer whose earnings have grown strongly on the back of an aggressive
acquisition strategy that has enabled the company to achieve cost efficiencies.
Stocks that detracted from performance included Penn Traffic Co., One Price
Clothing, and Charming Shoppes, all part of the retail sector which suffered a
sharp decline in 1995. Charming Shoppes has since been eliminated on
deteriorating fundamentals. Please refer to pages 27 - 33 for a complete
schedule of portfolio investments.
23
<PAGE> 26
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
ADVISOR'S INVESTMENT REVIEW (CONTINUED)
PORTFOLIO OUTLOOK: 1995's surprisingly good inflation performance suggests that
arguments for continued monetary restraint are diminishing. The likely adoption
of budget changes, long advocated by Federal Reserve Chairman Greenspan, also
indicates that the risks associated with a restrictive Fed policy are rising. As
a result, our belief is that Fed motivations are shifting from a policy of
slowing growth to a policy of recession prevention, implying that the central
bank will be more responsive to signs of weakness going forward than it has been
to date. Our view is that a rebound in the U.S. economy is likely next year,
rather than continued sluggish economic growth.
In 1995, many companies reported record earnings growth, as heavy cost-cutting
measures proved rewarding. Large cap companies, in particular, derived a
disproportionate benefit from cost cutting which is unlikely to be repeated.
Now, with cost cutting behind them, companies most likely to generate strong
earnings results will be those that derive a bulk of their earnings from sales
growth. It would appear that small cap companies are better positioned than many
large cap companies to increase sales and, therefore, have the opportunity to
grow faster.
24
<PAGE> 27
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
PORTFOLIO COMPOSITION
[Client will provide descriptions on graphics]
LIST OF TOP TEN LONG-TERM HOLDINGS
<TABLE>
<CAPTION>
PERCENT OF
TOTAL INVESTMENTS
<S> <C>
ADT Limited, Inc. 1.86%
Capital RE Corp. 1.70
Mesa Airlines, Inc. 1.55
Service Corporation International 1.43
TJX Companies, Inc. 1.41
Black & Decker, Inc. 1.15
Allegheny Ludlum Corp. 1.14
APRIA Healthcare Group, Inc. 1.10
Wellman, Inc. 1.04
Firstar Corp. 1.03
Balance - 325 Security Positions 86.59
- --------------------------------------------------------------------------
TOTAL 100.00%
</TABLE>
25
<PAGE> 28
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
PORTFOLIO COMPOSITION (CONTINUED)
LIST OF TOP TEN INDUSTRIES
<TABLE>
<CAPTION>
PERCENT OF
TOTAL INVESTMENTS
<S> <C>
Computer - Software 6.23%
Real Estate 5.28
Financial Services 4.95
Banking 4.66
Electronics 4.53
Telecommunications 4.48
Retail Stores 3.46
Machinery 3.07
Metal & Mining 3.06
Insurance 3.02
- -------------------------------------------------------------------------
TOTAL 42.74%
</TABLE>
26
<PAGE> 29
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS
COMMON STOCK--108.94%
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
ADVERTISING--0.21%
Advo Systems, Inc. 200 $ 5,200
--------
AEROSPACE--2.18%
Coltec Industries, Inc.+ 1,300 15,112
Kaydon Corp. 600 18,225
Orbital Sciences Corp.+ 600 7,650
Rohr Industries, Inc.+ 1,000 14,375
--------
Total 55,362
--------
AIRLINE--1.88%
Mesa Airlines, Inc.+ 5,300 47,700
--------
AUTOMOTIVE--0.83%
Paccar, Inc. 500 21,062
--------
AUTOMOTIVE PARTS & ACCESSORIES--1.98%
Excel Industries, Inc. 1,000 14,000
Intermet Corp.+ 1,300 13,650
Simpson Industries, Inc. 2,500 22,500
--------
Total 50,150
--------
BANKING--5.63%
CCB Financial Corp. 100 5,550
Cole Taylor Financial Group 100 2,988
Colonial Bankgroup, Inc. 300 9,675
First Commerce Corp. 700 22,400
Firstar Corp. 800 31,700
Irwin Financial Corp. 100 3,987
Northern Trust Corp. 100 5,600
Pinnacle Financial Services, Inc. 100 1,775
Silicon Valley Bancshares+ 200 4,800
Southern National Corp. 1,100 28,874
Sterling Bancshares, Inc. 150 2,625
Trustco Bank Corp. NY 200 4,425
Wilmington Trust Corp. 600 18,525
--------
Total 142,924
--------
BIOPHARMACEUTICALS--0.81%
Genemedicine, Inc.+ 300 2,287
Incyte Pharmaceuticals+ 300 7,500
Neurogen+ 100 2,687
Pharmacopeia, Inc.+ 100 2,425
Somatogen, Inc.+ 300 5,663
--------
Total 20,562
--------
BROADCASTING--0.81%
Comcast UK Cable Partners+ 200 2,500
Emmis Broadcasting Corp.,
Class A+ 100 3,100
Heartland Wireless+ 200 5,950
Heritage Media Corp., Class A+ 200 5,125
Peoples Choice TV Corp.+ 200 3,800
--------
Total 20,475
--------
CHEMICAL--2.18%
Albemarle Corp. 1,000 19,375
Applied Extrusion+ 100 1,250
Bush Boake Allen, Inc.+ 100 2,737
Wellman, Inc. 1,400 31,850
--------
Total 55,212
--------
COMMERICAL SERVICES--2.22%
Equity Corp. Intl.+ 100 2,375
Measurex Corp. 200 5,650
Robert Half Intl, Inc.+ 100 4,187
Service Corporation
International 1,000 44,000
--------
Total 56,212
--------
COMPUTER - PERIPHERALS--3.27%
Alantec Corp.+ 200 11,650
Boca Research, Inc.+ 200 5,300
IDX Systems Corporation+ 100 3,475
Mylex Corp.+ 500 9,563
Network Appliance, Inc.+ 100 4,013
Network Computing
Devices, Inc.+ 600 4,275
Planar Systems, Inc.+ 900 17,213
Quantum Corp.+ 1,100 17,737
</TABLE>
27
<PAGE> 30
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
COMMON STOCK (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
COMPUTER - PERIPHERALS (CONTINUED)
Visioneer, Inc.+ 100 $ 2,225
Xcellenet, Inc.+ 500 7,438
--------
Total 82,889
--------
COMPUTER - SOFTWARE--7.54%
Adept Technology+ 300 3,150
Amisys Managed Care
Systems+ 100 1,900
Astea International, Inc.+ 100 2,287
Autodesk, Inc. 300 10,275
Avid Technology, Inc.+ 800 15,200
BMC Software, Inc.+ 200 8,550
Ceridian Corp.+ 100 4,125
Checkfree Corp.+ 100 2,150
Citrix Systems, Inc.+ 100 3,250
Clarify, Inc.+ 100 3,000
Cooper & Chyan Technology+ 100 1,575
Cycare Systems, Inc.+ 100 2,562
DST Systems, Inc.+ 100 2,850
Fractal Design Corporation+ 100 1,400
Inso Corp.+ 100 4,250
Intersolv, Inc.+ 300 3,862
Logic Works, Inc.+ 200 2,500
MetaTools, Inc.+ 100 2,600
Microtec Research, Inc.+ 200 2,475
Network General Corp.+ 300 10,013
ON Technology Corporation+ 200 2,600
Pinnacle Systems, Inc.+ 200 4,950
Pixar, Inc.+ 100 2,888
Policy Management
Systems Corporation+ 300 14,288
Rational Software Corp.+ 600 13,425
Read-Rite Corp.+ 1,000 23,250
SPS Transaction Services, Inc.+ 300 8,888
SQA, Inc.+ 100 1,925
Summit Medical Systems+ 100 2,150
Sybase, Inc.+ 200 7,200
Symantec Corp.+ 900 20,925
Techforce Corporation+ 100 875
--------
Total 191,338
--------
CONSUMER PRODUCTS--2.12%
Coors, Adolph Co., Class B 200 4,425
Dekalb Genetics Corp. 600 27,075
Dreyers Grand Ice Cream 100 3,325
Nabisco Holdings Corp. 500 16,312
Riviana Foods, Inc. 200 2,650
--------
Total 53,787
--------
EDUCATION SERVICES--0.52%
DeVRY, Inc., Delaware+ 300 8,100
Flightsafety International, Inc. 100 5,025
--------
Total 13,125
--------
ELECTRICAL EQUIPMENT--1.76%
Encore Wire Corp.+ 200 1,950
Integrated Device
Technology, Inc.+ 200 2,575
Kuhlman Corp. 100 1,250
Micrel, Inc.+ 800 15,600
Microchip Technologies, Inc.+ 100 3,650
Vishay Intertechnology+ 200 6,300
W.W. Grainger, Inc.+ 200 13,250
--------
Total 44,575
--------
ELECTRONICS--5.49%
ADT Limited+ 3,800 57,000
Advanced Technology
Materials, Inc.+ 700 7,000
Amphenol Corp.+ 200 4,850
Brooktree Corp.+ 700 8,487
General Signal Corp. 600 19,425
Input/Output, Inc.+ 200 11,550
Mentor Graphics Corp.+ 300 5,475
Nimbus CD International, Inc.+ 500 4,063
SDL, Inc.+ 500 12,000
Symbol Technologies+ 200 7,900
Telcom Semiconductor, Inc.+ 200 1,450
--------
Total 139,200
--------
EMERGING TECHNOLOGY--0.13%
FEI Company+ 300 3,225
--------
</TABLE>
28
<PAGE> 31
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
COMMON STOCK (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
ENTERTAINMENT & LEISURE--2.33%
Ascent Entertainment
Group, Inc.+ 300 $ 4,725
Boyd Gaming Corp.+ 1,400 16,275
Carmike Cinemas, Inc.+ 100 2,250
IMAX Corp.+ 500 11,375
Johnson Worldwide
Association, Inc., Class A+ 300 6,750
Players International, Inc.+ 50 534
Royal Caribbean Cruises, Ltd. 700 15,400
SCP Pool Corp.+ 100 1,045
Sports Club Co.+ 200 625
--------
Total 58,979
--------
FINANCIAL SERVICES--6.00%
Amresco, Inc. 100 1,275
Banknorth Group, Inc. 200 7,700
Capital RE Corp. 1,700 52,275
Charter One Financial, Inc. 600 18,375
Commerce Bancorp, Inc. NJ 200 4,425
Community First Bankshares 200 4,550
Donaldson, Lufkin &
Jenrette+ 100 3,125
GBC Bancorp Calif 200 3,500
HUBCO, Inc. 100 2,212
Litchfield Financial Corp. 100 1,300
Mark Twain Bancshares, Inc. 100 3,875
National Commerce
Bancorporation 500 13,125
Payco American Corp.+ 300 2,700
Roosevelt Financial
Group, Inc. 900 17,437
Southwest Securities
Group, Inc. 500 5,563
WFS Financial, Inc.+ 100 1,950
Westamerica Bancorp 200 8,650
--------
Total 152,037
--------
FOOD PROCESSING--0.79%
Universal Foods Corp. 500 20,062
--------
FURNITURE & APPLIANCES--0.51%
Aaron Rents, Inc., Class B 100 1,800
Bush Industries, Inc. 200 3,925
Leggett & Platt, Inc. 300 7,275
--------
Total 13,000
--------
HEALTH SERVICES--0.54%
Summit Care Corp.+ 600 13,725
--------
HOME CONSTRUCTION--1.58%
Apogee Enterprises, Inc. 200 3,400
D.R. Horton, Inc. 1,600 18,800
USG Corp.+ 600 18,000
--------
Total 40,200
--------
HOSPITAL SERVICES & SUPPLIES--3.33%
Caremark International, Inc. 200 3,625
Cellpro, Inc.+ 800 12,800
Fresenius USA, Inc.+ 200 3,975
Mariner Health Group, Inc.+ 1,000 16,750
Oncor, Inc.+ 500 2,250
Owens & Minor, Inc. 900 11,475
Perseptive Biosystems, Inc.+ 1,200 10,200
Raytel Medical Corporation+ 100 850
Vivra, Inc.+ 900 22,613
--------
Total 84,538
--------
HOUSEHOLD PRODUCTS--0.50%
First Brands Corp. 100 4,763
Libbey, Inc. 200 4,500
Scott Paper, Ltd. 200 3,519
--------
Total 12,782
--------
INSURANCE--3.66%
AMBAC, Inc. 400 18,750
First Colony Corp. 500 12,687
Fremont General Corp. 200 7,350
MMI Companies, Inc. 900 21,600
Mid Ocean, Ltd., Ord 200 7,425
Partnerre, Ltd. 500 13,750
</TABLE>
29
<PAGE> 32
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
COMMON STOCK (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- -----------
<S> <C> <C>
INSURANCE (CONTINUED)
Renaissancere Holdings, Inc.+ 200 $ 6,075
USF&G Corp. 300 5,063
-------
Total 92,700
-------
LODGING--0.21%
Doubletree Corp.+ 100 2,625
Extended Stay America, Inc.+ 100 2,750
-------
Total 5,375
-------
MACHINERY--3.72%
Applied Power, Inc. 800 24,000
Asyst Technologies, Inc.+ 100 3,525
Black & Decker, Inc. 1,000 35,250
Briggs & Stratton Corp. 100 4,337
Credence Systems Corp.+ 300 6,863
Gardner Denver
Machinery Co.+ 800 15,200
Greenfield Industries, Inc. 100 3,125
Micrion Corp.+ 200 2,100
-------
Total 94,400
-------
MANUFACTURING--1.97%
Glatfelter (P.H.) Co. 500 8,562
Maverick Tube Corp.+ 600 4,650
Oakley, Inc.+ 100 3,400
Safety 1st, Inc.+ 700 10,325
Trinova Corp. 100 2,863
W.H. Brady Co., Class A 600 16,200
Whittaker Corp.+ 100 2,175
Zoltec Companies, Inc.+ 100 1,675
-------
Total 49,850
-------
MEDICAL--2.38%
APRIA Healthcare Group, Inc.+ 1,200 33,900
American Oncology
Resources+ 100 4,862
Instent, Inc.+ 300 4,500
Metra Biosystems, Inc.+ 200 3,450
Neuromedical Systems, Inc.+ 100 2,013
Physician Sales &
Service, Inc.+ 100 2,850
Research Medical, Inc.+ 100 2,700
Sierra Health Services, Inc.+ 100 3,175
Sterling House Corp.+ 300 2,887
-------
Total 60,337
-------
MEDICAL - BIOTECHNOLOGY--1.01%
Kensey Nash Corporation+ 100 1,250
Keravision, Inc.+ 500 6,250
Myriad Genetics+ 100 3,262
North American Biological+ 953 10,245
Sequana Theraputics, Inc.+ 200 4,675
-------
Total 25,682
-------
METAL & MINING--3.70%
Allegheny Ludlum Corp. 1,900 35,150
Commercial Metals Co. 1,000 24,750
Kaiser Aluminum Corp.+ 406 5,278
Oregon Steel Mills, Inc. 600 8,400
Schnitzer Steel Industries,
Inc., Class A 100 3,050
Steel Technologies, Inc. 2,000 17,250
-------
Total 93,878
-------
OFFICE PRODUCTS--0.64%
Harris Corp. 300 16,388
-------
OIL INTERNATIONAL--0.64%
Anadarko Petroleum Corp. 300 16,238
-------
OIL - PRODUCTION--2.77%
Devon Energy Corp. 600 15,300
Pogo Producing Co. 300 8,475
Texas Meridian, Inc.+ 600 8,175
TransCanada Pipelines, Ltd. 1,800 24,750
Vintage Petroleum, Inc. 600 13,500
-------
Total 70,200
-------
OIL - SERVICES--1.15%
Camco International, Inc. 100 2,800
Dreco Energy Services, Ltd.+ 400 7,100
El Paso Natural Gas Company 100 2,838
</TABLE>
30
<PAGE> 33
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
COMMON STOCK (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
OIL - SERVICES (CONTINUED)
Noble Affiliates, Inc.+ 100 $ 2,988
Noble Drilling Corp. 500 4,500
Oceaneering
International, Inc.+ 300 3,862
Smith International, Inc.+ 100 2,350
Tejas Power Corporation+ 300 2,738
--------
Total 29,176
--------
PHARMACEUTICALS--2.68%
Allergan, Inc. 200 6,500
Alza Corporation+ 900 22,275
Athena Neurosciences, Inc.+ 500 6,125
Fuies Technologies, Ltd.+ 100 1,525
IVAX Corp. 200 5,700
SangStat Medical Corp.+ 500 5,187
Targeted Genetics Corp.+ 500 2,813
Vertex Pharmaceuticals, Inc.+ 400 10,600
Vical, Inc.+ 600 7,275
--------
Total 68,000
--------
POLLUTION CONTROL--2.04%
Culligan Water Technology+ 100 2,425
Dames & Moore, Inc. 2,300 27,887
Mid-American Waste
Systems, Inc.+ 700 2,450
Sevenson Environmental
Services, Inc. 200 3,475
Tetra Technologies+ 900 15,637
--------
Total 51,874
--------
PUBLISHING & PRINTING--1.74%
Banta Corp. 500 22,000
Consolidated Graphics, Inc.+ 500 13,000
K-III Communications
Corporation+ 500 6,063
Norwood Promotional+ 100 1,700
Thomas Nelson, Inc. 100 1,300
--------
Total 44,063
--------
REAL ESTATE--6.39%
Associated Estate Realty 200 4,300
Cali Realty Corp. 300 6,563
Capstone Capital Trust, Inc. 500 9,563
Centerpoint Properties Corp. 200 4,625
Chelsea GCA Realty, Inc. 200 6,000
Colonial Properties 100 2,550
Developer Diversified
Realty Corp. 200 6,000
FelCor Suite Hotels 100 2,775
Gables Residential Trust 100 2,288
Health & Retirement
Properties Trust 600 9,750
Healthcare Realty 900 20,700
Home Properties NY, Inc. 100 1,713
Hospitality Properties Trust 100 2,675
Liberty Property Trust 300 6,225
Merry Land & Investment, Inc. 100 2,363
Oasis Residential,Inc 100 2,275
Patriot American
Hospitality, Inc. 100 2,575
Public Storage, Inc. 200 3,800
ROC Communities, Inc. 500 12,000
Security Capital Industrial Trust 500 8,750
Security Capital Pacific Trust 800 15,800
Sovran Self Storage 200 5,300
Starwood Lodging, Inc. 200 5,950
Storage Trust Realty 300 6,825
Summit Properties 100 1,988
Sun Communities, Inc. 100 2,638
Vornado Realty Trust 100 3,750
Wellsford Residential Properties 100 2,300
--------
Total 162,041
--------
RESTAURANTS--0.25%
Sbarro, Inc. 100 2,150
Starbucks Corp.+ 200 4,200
--------
Total 6,350
--------
RETAIL STORES--4.19%
Borders Group, Inc.+ 400 7,400
Catherine Stores Corp.+ 800 6,600
Chaus (Bernard), Inc.+ 700 2,537
</TABLE>
31
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- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
COMMON STOCK (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
RETAIL STORES (CONTINUED)
Dollar General Corp. 300 $ 6,225
Garden Ridge Corp.+ 100 3,875
Hannaford Brothers Co. 100 2,462
Kohls Corp.+ 100 5,250
Leslies Poolmart+ 200 2,800
Office Depot, Inc.+ 100 1,975
One Price Clothing
Stores, Inc.+ 1,000 3,000
Penn Traffic Co., New+ 700 10,500
Stop & Shop
Companies, Inc.+ 100 2,313
TJX Companies, Inc. 2,300 43,413
Urban Outfitters+ 100 2,325
Vons Companies, Inc.+ 200 5,650
----------
Total 106,325
----------
TELECOMMUNICATIONS--5.42%
Andrew Corp.+ 100 3,825
Applied Digital Access+ 600 7,050
Broadband Technologies+ 100 1,625
Celeritek, Inc.+ 100 1,062
Comdial Corp.+ 1,200 10,950
Digital Microwave
Corporation+ 300 3,000
Frontier Corporation 700 21,000
International Cabletel, Inc.+ 100 2,450
Leasing Solutions, Inc.+ 100 1,500
Metrocall, Inc.+ 100 1,912
Mobilemedia, Inc.+ 500 11,125
Paging Network+ 1,300 31,688
Scientific Atlanta, Inc. 2,000 30,000
Spectrian Corp.+ 200 4,450
Videotron Holdings, PLC+ 200 2,550
Wireless One, Inc.+ 200 3,300
----------
Total 137,487
----------
TEXTILES & SHOES--1.84%
Collins & Aikman, New+ 800 5,300
Fruit of the Loom, Inc.,
Class A+ 900 21,937
Gucci Group, Inc.+ 100 3,888
Nine West Group, Inc.+ 100 3,750
Warnaco Group, Inc. 300 7,500
Wolverine World Wide Inc. 100 3,150
Worldtex, Inc.+ 200 1,150
----------
Total 46,675
----------
TRUCKING & LEASING--0.82%
American Freightways Corp.+ 500 5,188
Rollins Truck Leasing 200 2,225
USA Truck, Inc.+ 100 1,075
Werner Enterprises, Inc. 600 12,150
----------
Total 20,638
----------
UTILITIES - ELECTRIC--3.54%
Central Hudson Gas &
Electric Corp. 800 24,700
Central Louisiana Electric, Inc. 200 5,375
Illinova Corp. 200 6,000
Pinnacle West Capital Corp. 600 17,250
Potomac Electric Power Co. 600 15,750
Washington Water Power Co. 800 14,000
Western Resources, Inc. 200 6,675
----------
Total 89,750
----------
UTILITIES - GAS--1.44%
Atlantic Gas and Light 500 9,875
Brooklyn Union Gas Company 300 8,775
Providence Energy Corp. 500 8,500
United Cities Gas Co. 500 9,375
----------
Total 36,525
----------
UTILITIES - WATER & SEWER--1.60%
American Water Works, Inc. 700 27,212
Aquarion Co. 100 2,550
E'Town 100 3,012
SJW Corp. 100 3,775
Southern California Water Co. 200 4,050
----------
Total 40,599
----------
TOTAL COMMON STOCK
(Cost $2,512,689) $2,762,872
----------
</TABLE>
32
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- --------------------------------------------------------------------------------
RESOLUTE SMALL COMPANY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
PREFERRED STOCK--0.19%
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
TELECOMMUNICATIONS EQUIPMENT--0.19%
MFS Communications, Conv.,
8.000%+ 100 $4,869
-----
TOTAL PREFERRED STOCK
(Cost $3,350) $4,869
------
<CAPTION>
SHORT-TERM OBLIGATIONS--11.92%
PRINCIPAL MARKET VALUE
U.S. TREASURY BILLS AMOUNT (NOTE B)
- ------------------- --------- ------------
<C> <C> <C>
5.440%, due 01/25/96 $ 15,000 $ 14,941
5.445%, due 01/25/96 10,000 9,961
5.310%, due 03/07/96 39,000 38,659
4.970%, due 03/15/96 22,000 21,783
5.185%, due 03/21/96 41,000 40,560
5.210%, due 03/21/96 29,000 28,689
5.280%, due 03/21/96 12,000 11,871
5.280%, due 03/21/96 13,000 12,860
5.285%, due 03/21/96 6,000 5,936
4.930%, due 04/04/96 107,000 105,637
5.085%, due 11/14/96 12,000 11,480
--------
TOTAL SHORT-TERM OBLIGATIONS
(Cost $302,132) $302,377
--------
<CAPTION>
SUMMARY OF TOTAL NET ASSETS
MARKET VALUE
(NOTE B)
------------
<S> <C> <C>
TOTAL INVESTMENTS
(Cost $2,818,171)* 121.05% $ 3,070,118
Other assets, less liabilities (21.05) (533,860)
TOTAL NET ASSETS 100.00% $ 2,536,258
====== ===========
</TABLE>
*Aggregate cost for Federal income tax purposes.
+Non-income producing security.
33
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[This page intentionally left blank]
<PAGE> 37
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- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
PORTFOLIO FACTS
INCEPTION DATE
January 3, 1995
FUND MANAGER
Morgan Guaranty Trust Co. of New York
INVESTMENT OBJECTIVE AND STRATEGY
To provide a high total return from a
portfolio of equity securities of
foreign corporations.
The Portfolio seeks to achieve its investment
objective through country allocation and
stock valuation and selection.
NET ASSETS AS OF 12/31/95
$3,992,275
NUMBER OF HOLDINGS
242
PORTFOLIO TURNOVER
68.0%
IN THIS SECTION
Portfolio Facts
Investment Comparison
Advisor's Investment Review
Portfolio Composition
Schedule of Portfolio Investments
35
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- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
INVESTMENT COMPARISON
[GRAPH - RESOLUTE INTERNATIONAL EQUITY PORTFOLIO AND THE MODIFIED MSCI EAFE
INDEX]
Past performance is not predictive of future performance.
This graph compares an initial $10,000 investment made in the Resolute
International Equity Portfolio at its inception with a similar investment in the
Modified MSCI EAFE Index. The Modified MSCI EAFE Index reflects actual portfolio
composition for the period. For the purpose of this graph and the accompanying
table, the total return for the Portfolio reflects all recurring expenses
(advisory fees, account fees) and includes the reinvestment of all dividends and
distributions.
Shares of the Portfolio are offered only through divisions of Chubb Separate
Account C established by Chubb Life Insurance Company of America to fund
flexible premium variable life insurance policies. Total returns do not reflect
any separate account expenses imposed on the policies which include a 3% sales
charge, 2.5% premium tax charge, DAC tax sales charge, cost of insurance,
mortality expenses and surrender charges.
The Modified MSCI EAFE Index is an unmanaged index and includes the reinvestment
of all dividends, but does not reflect the payment of transaction costs,
advisory fees or expenses that are associated with an investment in the
Portfolio.
36
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- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
ADVISOR'S INVESTMENT REVIEW
12-MONTH PERIOD ENDED DECEMBER 31, 1995
MARKET REVIEW: In 1995, international equity market performance was overshadowed
by the impressive returns posted by the U.S. stock market. While the S&P 500
Index was up more than 30% in 1995, the EAFE Index gained nearly 10% in local
currency terms.
In Europe, the relative strength of the Deutsche Mark early in the period
dampened German exports. The resulting slowdown in economic growth led to
interest rate cuts by the Bundesbank and the central banks of other European
countries, including Switzerland, Belgium, and the Netherlands. Despite negative
earnings revisions, the favorable interest rate environment resulted in most
major markets posting positive returns for the period.
Towards year-end, Japan continued to recover from the severe declines
experienced during the first half of 1995, posting a 4% gain for the year as
measured by the Nikkei Index. The improvement was propelled by very low interest
rates, fiscal stimulus and infusions of liquidity from the Bank of Japan. Also,
the declining yen, combined with renewed signs of economic strength, encouraged
upward revisions to corporate profit estimates.
Market results were mixed elsewhere in the Pacific Basin throughout the year.
This was largely due to concerns over the pace of economic development and the
condition of real estate markets, as well as domestic political issues. For
example, Singapore suffered as its exports were compromised by a strengthening
currency, with its domestic consumption dampened by rising interest rates.
Malaysia also performed relatively poorly in light of concern over increased
inflationary pressures. The Hong Kong market, however, rose over 20% according
to the Hang Seng Index, helped by the currency's close tie to the U.S. dollar.
PORTFOLIO REVIEW: The Portfolio seeks to diversify its sources of value-added
securities by making multiple, independent investment decisions: country
allocation, stocks selection, and currency allocation. During the year, we
slightly reduced the Portfolios holdings in Japan, although Japan still remains
our single largest position. Earlier in the year the Portfolio's Japan
overweighting hindered performance; however, over the last six months, the
Portfolio has benefited from the above average exposure due to the strongly
recovering Japanese equity market. This was due to the fall in the yen and
sharply lower interest rates, which have led to an improvement in business
confidence. Therefore, we believe that economic growth and corporate profits are
likely to surprise on the upside. Because we feel that a lot of the good news
has been discounted, we have recently scaled back positions, although Japan
still remains our largest single weighting. Holdings in other Far East markets
such as Malaysia, Australia and Hong Kong have also been reduced due to
worsening interest rate outlooks and inflationary pressures.
In Europe, positions have been increased, particularly in the UK. Our more
positive view on the UK was driven by improved valuations as interest rates
declined together with an encouraging supply/demand picture due to strong
institutional cash-flow, high M&A activity, share buy-backs and rapid dividend
increases. In addition, due to the better fiscal position, the UK was less
affected by the second-half slowdown than many other European markets. Our
pessimism over some of the more peripheral European markets finally paid off as
Finland, Sweden, Austria and Italy all suffered sharp declines in the latter
part of the year.
37
<PAGE> 40
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
ADVISOR'S INVESTMENT REVIEW (CONTINUED)
Besides trying to add value through our country allocation decisions by
overweighting those countries which appeared undervalued on a long-term basis
and underweighting those that appear overvalued, we concentrate the bulk of our
efforts on stock selection that is, attempting to outperform each of the local
markets in which the Portfolio invests by purchasing the most undervalued
stocks. We believe that stock selection has the most consistently reliable
potential to add value over the long term. However, results this year were
somewhat disappointing. Stock selection in Europe had a positive impact, but
this was more than offset by a weaker result in Japan. In addition, currency
management contributed positively to overall returns. The decision to hedge
partially the portfolio's yen exposure into the U.S. dollar, in anticipation
of a decline in the yen against the dollar, began to add value during the third
quarter.
PORTFOLIO OUTLOOK: Although international equity markets in general
underperformed the U.S. market for the year, our valuation analysis indicates
that foreign stocks are significantly more attractive than U.S. stocks at the
present time. We expect economic growth outside of the U.S. to strengthen as the
year progresses, first in Japan, then in Europe. In the U.S., we believe long
term interest rates are below normal, whereas internationally, particularly in
Europe, there is more scope for further interest rate declines. In addition,
profits in the U.S. are close to a cyclical peak, whereas elsewhere,
particularly in Japan, they are showing early signs of a strong rebound in 1996.
Our main currency view is that the yen is still overvalued although, because it
has fallen by nearly 25% versus the U.S. dollar since June 1995, we believe it
has become more reasonably valued. Accordingly, we plan to reduce the size of
our underweighting versus the yen as it continues to weaken. On a longer term
basis, we continue to believe that international investing has the potential to
provide investors with attractive returns and still makes sense as part of a
fully diversified portfolio.
38
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- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
PORTFOLIO COMPOSITION
[PIE CHART]
LIST OF TOP TEN COUNTRIES
<TABLE>
<CAPTION>
PERCENT OF
TOTAL INVESTMENTS
-----------------
<S> <C>
Japan 29.53%
United Kingdom 19.60
France 11.85
Germany 9.12
Switzerland 8.06
Netherlands 5.14
Hong Kong 3.64
Australia 3.12
Norway 2.43
Spain 2.40
- -----------------------------------------------------------------------
TOTAL 94.89%
</TABLE>
39
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- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
PORTFOLIO COMPOSITION (CONTINUED)
LIST OF TOP TEN INDUSTRIES
<TABLE>
<CAPTION>
PERCENT OF
TOTAL INVESTMENTS
-----------------
<S> <C>
Banking 10.41%
Pharmaceuticals 7.35
Financial Services 6.48
Chemicals & Plastics 6.00
Utilities 5.70
Automobiles, Trucks & Parts 5.33
Oil & Gas-Integrated 5.16
Manufacturing Diversified 4.85
Insurance 4.61
Metal & Mining 4.56
- ------------------------------------------------------------------------
TOTAL 60.45%
LIST OF TOP TEN LONG-TERM HOLDINGS
<CAPTION>
PERCENT OF
TOTAL INVESTMENTS
-----------------
<S> <C>
Royal Dutch Petroleum 2.01%
Roche Holdings Genusscheine, NPV 1.37
Glaxo, PLC 1.35
Veba, A.G. 1.27
Sandoz, A.G. 1.25
Hitachi 1.25
Munchener Ruckversicherungs 1.12
Ciba Geigy, A.G. 1.11
Siemens, A.G. 1.09
Nomura Securities Corp., Ltd. 1.08
Balance - 232 Security Positions 87.10
- ------------------------------------------------------------------------
TOTAL 100.00%
</TABLE>
40
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CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS
COMMON STOCK--101.03%
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
AUSTRALIA--3.16%
Broken Hill Properties
Co., Ltd. 2,240 $ 31,660
C.S.R., Ltd. 4,000 13,033
National Australia
Bank, Ltd. 2,200 19,802
News Corporation, Ltd. 3,000 16,023
Southcorp Holdings, Ltd. 7,600 17,695
TNT Limited+ 4,100 5,429
Western Mining Corp.
Holdings 3,500 22,495
--------
Total 126,137
--------
BELGIUM--1.67%
Generale de Banque, NPV 65 23,026
Solvay, S.A. 35 18,910
Tractebel Cap, NPV 60 24,771
--------
Total 66,707
--------
DENMARK--1.14%
Carlsberg, A.S., Class B 160 8,950
Den Danske Bank 100 6,911
International Service System B 130 2,933
Novo Nordisk, A.S.,
Class B 50 6,857
Sophus Berendsen, Class B 100 11,278
Tele Danmark, A.S., Class B 160 8,748
--------
Total 45,677
--------
FRANCE--12.01%
AXA 422 28,477
Air Liquide (L) 76 12,604
Alcatel Alsthom 252 21,756
Bouygues 128 12,912
Carrefour 25 15,188
Cetelem 100 18,792
Christian Dior, S.A. 190 20,514
Cie Generale des Eaux 193 19,295
Compagnie Financiere de
Paribas 26 1,428
Credit Commercial de France 300 15,330
Credit Local de France 130 10,421
Dollfus-Mieg & Cie 200 8,175
Elf Aquitane 264 19,477
Groupe Danone 192 31,723
Havas 100 7,944
Lafarge-Coppee 170 10,968
Lagardere Groupe 430 7,914
Legrand, S.A. 70 7,014
Lyonnaise des Eaux 60 5,785
Promodes 120 28,244
Renault, S.A. 400 11,533
Rhone-Poulenc, S.A., Class A 400 8,580
Saint Gobain 90 9,975
Sanofi 275 17,652
Seita 400 14,518
Sidel 40 12,482
Societe Generale 171 21,155
Synthelabo 380 23,840
Television Francaise 130 13,956
Total, S.A., Class B 400 27,033
Usinor Sacilor+ 600 7,864
Valeo, S.A. 150 6,957
--------
Total 479,506
--------
GERMANY--9.24%
AVA Allegemeine
Handels-Der Verbr 30 10,166
Allianz Holding Co. 13 25,579
Bayer, A.G. 150 39,911
Bilfinger and Berger, A.G. 25 9,520
Deutsche Bank, A.G. 500 23,791
Deutsche Pfandbrief &
Hypothekenbank 400 15,567
Henkel 70 26,387
M.A.N., A.G. 60 16,643
Munchener
Ruckversicherungs 21 45,340
Seimens, A.G. 80 44,047
Thyssen, A.G. 110 20,114
Veba, A.G. 1,200 51,481
</TABLE>
41
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CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
COMMON STOCK (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
GERMANY (CONTINUED)
Volkswagen, A.G. 120 $ 40,330
--------
Total 368,876
--------
HONG KONG--3.69%
Citic Pacific, Ltd. 8,000 27,367
HSBC Holdings, PLC 1,200 18,159
Henderson Land
Development Co., Ltd. 7,000 42,189
Hong Kong
Telecommunication 11,200 19,990
Hong Kong Electric
Holdings, Ltd. 4,500 14,754
Johnson Electric
Holdings, Ltd. 8,000 14,278
Television Broadcast, Ltd. 3,000 10,689
--------
Total 147,426
--------
ITALY--0.93%
Assicurasioni Genera, SPA 400 9,695
Banca Popolare di
Bergamo, SPA 300 4,151
Edison, SPA 2,000 8,623
Fiat, SPA 3,000 5,484
Telecom Italia, SPA 6,000 9,342
--------
Total 37,295
--------
JAPAN--29.63%
Asahi Bank Limited 2,000 25,206
Chugai Pharmaceutical Co. 3,000 28,763
Chugoku Bank 1,000 17,256
Cosmo Oil Co., Ltd. 5,000 27,338
Dai Dan Co. 1,000 12,894
Dai-Ichi Kangyo Bank, Ltd. 2,000 39,360
Daiei, Inc. 1,000 12,118
Daito Trust Construction
Co., Ltd. 1,000 11,827
Daiwa Bank 4,000 31,740
East Japan Railway Co. 5 24,333
Ebari Corp. 1,000 14,639
Fuji Denki Reiki 1,000 13,378
Fuji Electric Co., Ltd. 3,000 15,269
Fuji Heavy Industries+ 3,000 11,837
Fukui Bank 2,000 10,664
Gunze Sangyo, Inc. 5,000 22,830
Hitachi 5,000 50,411
Hitachi Transport System 2,000 19,389
Hokkaido Takushoku Bank 5,000 14,833
Honda Motor Co. 1,000 20,649
Ishikawa Jima-Harima
Industries 6,000 25,303
Japan Tobacco 1 8,677
Joroku Bank 2,000 10,392
Kanematsu Corp. 2,000 7,814
Komatsu Forklift Co., Ltd. 4,000 26,563
Kurabo Industries 2,000 7,659
Kyowa Hakko Kogyo Co., Ltd. 1,000 9,442
Maruetsu, Inc. 1,000 8,143
Matsushita Electric Industries 2,000 32,573
Mineba Co., Ltd. 1,000 8,395
Mitsubishi Cable Industries 1,000 5,332
Mitsubishi Chemical Co. 3,000 14,600
Mitsubishi Gas Chemical Co. 2,000 9,016
Mitsui Fudosan Co., Ltd. 1,000 12,312
Mitsui Mining and
Smelting Co.+ 2,000 8,027
Mitsui Toatsu Chemicals, Inc. 3,000 12,070
Minzuno Corp. 2,000 17,353
NEC Corp. 2,000 24,430
NKK Corporation+ 5,000 13,475
Nippon Credit Bank 4,000 18,303
Nippon Paper Industries 2,000 13,902
Nippon Road Co., Ltd. 1,000 8,434
Nippon Sheet Glass Co.+ 2,000 8,706
Nissan Diesel Motor Co.+ 1,000 4,663
Nisshin Steel Co., Ltd. 3,000 12,128
Nomura Securities Corp., Ltd. 2,000 43,625
Ricoh Co. 2,000 21,909
Sanwa Bank, Ltd. 1,000 20,358
Sakura Bank, Ltd. 3,000 38,099
Seiyu, Ltd. 1,000 12,409
Snow Brand Milk Products
Co., Ltd. 2,000 12,797
</TABLE>
42
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CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
COMMON STOCK (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
JAPAN (CONTINUED)
Sony Corp. 500 $ 30,004
Sumitomo Forestry Co. 1,000 15,317
Sumitomo Metal Industries+ 8,000 24,275
Takashimaya Co., Ltd. 1,000 15,996
Toho Gas Co., Ltd. 5,000 16,190
Tohoku Electric Power
Co., Inc. 1,000 24,139
Tokio Marine & Fire
Insurance Co. 1,000 13,088
Tokyo Electric Power Co. 300 8,027
Toyo Construction Co. 3,000 17,508
Toyo Trust and
Banking Co., Ltd. 2,000 17,683
Toyota Motor Co., Ltd. 2,000 42,462
Tsubakimoto Chain 2,000 12,041
UBE Industries, Ltd.+ 5,000 18,904
Yokohama Rubber Co., Ltd. 2,000 12,118
Zexel Corp. 2,000 13,611
----------
Total 1,183,006
----------
NETHERLANDS--5.21%
ABN Amro Holding, NV 455 20,750
Aegon NV 210 9,302
Dutchstate Mines, NV 140 11,529
Elsevier, NV 1,040 13,885
Internationale Nederlanden
Groep, NV 250 16,720
Koninklijke KNP BT NV 410 10,539
Koninklijke KNP PTT
Nederland NV 200 7,274
Philips Electronics 300 10,855
Royal Dutch Petroleum 580 81,126
Unilever, N.V., CVA 185 26,026
----------
Total 208,006
----------
NORWAY--2.46%
Hafslund Nycomed, Class B 700 17,783
Kvaerner, A.S., Class B 500 16,778
Norsk Hydro, A.S. 1,000 42,103
Orkla, A.S., Class B 450 21,511
----------
Total 98,175
----------
SINGAPORE--1.42%
Cycle and Carriage, Ltd. 1,000 9,969
Development Bank of
Singapore 1,000 12,443
Natsteel, Ltd. 2,000 4,101
Sembawang Corp., Ltd. 1,000 5,550
Singapore Airlines, Ltd. 1,000 9,333
United Overseas Bank 1,000 9,615
United Overseas Land 3,000 5,706
----------
Total 56,717
----------
SPAIN--2.44%
Banco Popular Espanol 100 18,439
Bankinter 140 13,617
Empresa Nacional de
Electridad 300 16,989
Fuerzas Electridad de
Cataluna, S.A. Class A 2,075 14,795
Iberdrola, S.A. 1,500 13,725
Repsol, ADR 200 6,575
Repsol 400 13,106
----------
Total 97,246
----------
SWITZERLAND--8.17%
BBC, Brown, Boveri and
Cie, A.G. 83 18,828
CS Holding, Bearer 155 15,930
Ciba Geigy, A.G. 51 44,990
Compagnie Finaciere
Richemont-Units, Class A+ 5 7,518
Holderbank Financiere
Glaris, A.G. 10 7,692
Nestle, S.A. 33 36,596
Roche Holdings
Genusscheine, NPV 7 55,514
Sandoz, A.G. 55 50,478
Schweizerische
Ruckversicherungs 15 17,495
</TABLE>
43
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- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
COMMON STOCK (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET VALUE
COMPANY OF SHARES (NOTE B)
- ------- --------- ------------
<S> <C> <C>
SWITZERLAND (CONTINUED)
Schweizerischer Bankverein 70 $ 28,655
Schweizerischer Bank
Gesellschaft 16 17,382
Societe Generale de
Surveillance Holding 5 9,951
Zurich Versicherungs 50 14,992
----------
Total 326,021
----------
UNITED KINGDOM--19.86%
Agryll Group, PLC 3,000 15,838
Allied Colloids Group, PLC 4,900 10,272
Amersham Intl., PLC 500 6,887
Argos 1,900 17,584
B.A.T. Industries, PLC 3,000 26,436
B.I.C.C 1,500 6,429
BOC Group, PLC 600 8,394
BTR, PLC 3,600 18,391
Barclays Bank 1,000 11,475
British Gas, PLC 2,600 10,255
British Petroleum, PLC 2,307 19,309
British Telecommunications
PLC 5,800 31,882
Cable & Wireless, PLC 1,400 10,000
Caradon, PLC 2,500 7,589
Forte 2,000 10,264
General Electric, PLC 3,000 16,537
Glaxo, PLC 3,835 54,488
Glynwed, PLC 1,000 4,984
Granada Group, PLC 1,000 10,016
Grand Metropolitan, PLC 2,300 16,571
Guardian Royal
Exchange, PLC 3,400 14,571
Guinness, PLC 2,100 15,457
HSBC Holdings 1,550 24,213
Hanson Trust, PLC 3,500 10,462
Hillsdown Holding, PLC 4,500 11,809
Inchape, PLC 1,620 6,264
J. Sainsbury, PLC 2,000 12,189
Kingfisher 2,200 18,516
Ladbroke Group 2,000 4,550
Lloyds Bank, PLC 3,380 17,372
MEPC 1,800 11,040
Marks & Spencer, PLC 1,000 6,988
National Westminster Bank 2,000 20,140
National Grid+ 756 2,342
Pearson, PLC 1,200 11,627
Peninsular & Oriental Steam
Navigation 800 5,913
RTZ Corp., PLC 800 11,627
Racal Electronics 1,800 7,952
Reckitt and Coleman 940 10,407
Reuters Holding 1,300 11,910
Rexam, PLC 1,400 7,696
Rolls Royce 5,000 14,674
Royal Bank of Scotland, PLC 2,000 18,199
Scottish Hydro-Electric, PLC+ 2,000 11,165
Scottish and Newcastle, PLC 1,500 14,278
Sears Holdings 8,700 14,050
Shell Transport and
Trading Co. 2,100 27,783
Smithkline Beecham
Equity Units 800 8,721
Smithkline Beecham 750 8,269
Standard Chartered Bank 1,500 12,764
Sun Alliance Group, PLC 2,000 11,599
Tarmac, PLC 8,000 12,795
Thorn EMI, PLC 400 9,422
Tomkins 2,700 11,823
United Biscuits (Hldgs), PLC 2,600 10,335
Vickers, PLC 1,300 5,127
Vondafone Group, PLC 3,800 13,630
Willis Corroon Group, PLC 2,800 6,130
Yorkshire Electricity Group 1,000 10,365
Yorkshire Water 1,000 9,193
Zeneca Group 300 5,804
----------
Total 792,772
----------
TOTAL COMMON STOCK
(Cost $3,783,732) $4,033,567
----------
</TABLE>
44
<PAGE> 47
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF PORTFOLIO INVESTMENTS (CONTINUED)
CORPORATE BONDS -- 0.29%
<TABLE>
<CAPTION>
PRINCIPAL MARKET VALUE
COMPANY AMOUNT (NOTE B)
- ------- ---------- ------------
<S> <C> <C>
JAPAN--0.29%
Ryobi, Ltd., 2.800%,
due 03/29/02 $1,000,000 $ 11,410
----------
TOTAL CORPORATE BOND
(Cost $11,070) $ 11,410
----------
SUMMARY OF TOTAL NET ASSETS
<CAPTION>
MARKET VALUE
(NOTE B)
------------
<S> <C> <C>
TOTAL INVESTMENTS
(Cost $3,794,802)* 101.32% $ 4,044,977
Other assets, less liabilities (1.32) (52,702)
------ -----------
TOTAL NET ASSETS 100.00% $ 3,992,275
====== ===========
</TABLE>
*Aggregate cost for Federal income tax purposes.
+Non-income producing security.
45
<PAGE> 48
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<CAPTION>
RESOLUTE
TREASURY RESOLUTE RESOLUTE
MONEY RESOLUTE RESOLUTE SMALL INTERNATIONAL
MARKET BOND EQUITY COMPANY EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ---------- ---------- ---------- -------------
<S> <C> <C> <C> <C> <C>
ASSETS
Investments, at cost-see accompanying
Schedule of Portfolio Investments ................ $ 1,364,786 $1,402,461 $3,985,087 $2,818,171 $3,794,802
=========== ========== ========== ========== ==========
Investments, at market value (Note B) ........... $ 1,365,425 $1,496,007 $4,374,993 $3,070,118 $4,044,977
Cash & currencies ............................... 1,708 55,647 4,388 1,889 92,436
Receivable for accrued investment
income (Note B) ............................... 19,965 6,269 4,935 12,241
Receivable for portfolio securities sold ........ 18,299 3,250
Net receivable for foreign forward
contracts (Note B) ............................ 5,180
Net receivable from capital shares sold ......... 211
Deferred organization costs (Note F) ............ 7,904 7,904 7,904 7,904 7,904
----------- ---------- ---------- ---------- ----------
Total Assets ............................... 1,375,037 1,579,523 4,411,853 3,085,057 4,165,988
LIABILITIES
Net payable from capital shares purchased ....... 37,160 413 1,333 1,868
Dividends payable ............................... 56,408 101,250 248,572 312,368 138,377
Payable for portfolio securities purchased ...... 52,367 6,472 225,975 21,716
Accrued expenses ................................ 633 895 3,114 2,552 3,848
Payable for organization costs (Note F) ......... 7,904 7,904 7,904 7,904 7,904
----------- ---------- ---------- ---------- ----------
Total Liabilities .......................... 102,105 162,829 267,395 548,799 173,713
----------- ---------- ---------- ---------- ----------
NET ASSETS ......................................... $ 1,272,932 $1,416,694 $4,144,458 $2,536,258 $3,992,275
=========== ========== ========== ========== ==========
NET ASSETS CONSIST OF:
Paid in capital ................................. $ 1,272,293 $1,321,105 $3,681,552 $2,165,278 $3,746,620
Accumulated net realized gain from
investments .................................... 2,043 73,000 119,033 7,530
Overdistribution of net realized gain from
foreign currency transactions .................. (17,118)
Net unrealized gain on investments (Note C) ..... 639 93,546 389,906 251,947 250,175
Net unrealized gain on translation of assets
and liabilities in foreign currencies (Note C) . 5,068
----------- ---------- ---------- ---------- ----------
Net Assets ......................................... $ 1,272,932 $1,416,694 $4,144,458 $2,536,258 $3,992,275
=========== ========== ========== ========== ==========
Shares of common stock outstanding
(no par value, unlimited shares authorized) ..... 126,500 129,900 328,070 214,324 367,556
=========== ========== ========== ========== ==========
Net asset value and offering price per share ....... $ 10.06 $ 10.91 $ 12.63 $ 11.83 $ 10.86
=========== ========== ========== ========== ==========
</TABLE>
See notes to financial statements.
46
<PAGE> 49
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE PERIOD JANUARY 3, 1995 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1995
<TABLE>
<CAPTION>
RESOLUTE
TREASURY RESOLUTE RESOLUTE
MONEY RESOLUTE RESOLUTE SMALL INTERNATIONAL
MARKET BOND EQUITY COMPANY EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- --------- -------------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME
INCOME:
Interest .............................................. $ 63,109 $ 84,468 $ 9,186 $ 11,713 $ 7,448
Dividends ............................................. 56,619 39,591 68,113
Foreign taxes withheld ................................ (211) (5,864)
--------- --------- --------- --------- ---------
Total investment
income ............................................. 63,109 84,468 65,594 51,304 69,697
EXPENSES:
Advisory fees (Note D) ................................ 4,520 6,224 16,451 19,131 24,543
Custodian fees ........................................ 565 1,245 4,113 4,783 8,270
Shareholder reports ................................... 3,820 4,239 9,571 8,022 10,397
Professional fees ..................................... 6,823 7,452 12,960 14,347 16,653
Directors fees ........................................ 6,960 7,620 12,959 14,625 16,837
Security valuation .................................... 5,733 6,324 14,514 12,140 15,872
Insurance expense ..................................... 1,067 1,168 1,871 2,240 2,522
Miscellaneous expenses ................................ 67 74 163 142 182
Amortization of deferred organization .................
costs (Note F) ....................................... 1,930 1,930 1,930 1,930 1,930
--------- --------- --------- --------- ---------
Total expenses ...................................... 31,485 36,276 74,532 77,360 97,206
Expenses reimbursed by Chubb Life
and Morgan (Note D) .................................. (24,706) (26,941) (49,856) (49,860) (60,418)
--------- --------- --------- --------- ---------
Net expenses ........................................ 6,779 9,335 24,676 27,500 36,788
--------- --------- --------- --------- ---------
Net investment income ............................... 56,330 75,133 40,918 23,804 32,909
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY
Net realized gain (loss) on investments .............. 78 28,160 280,654 407,597 (14,394)
Net realized gain from foreign currency transactions . 110,274
Net unrealized gain on investments ................... 639 93,546 389,906 251,947 250,175
Net unrealized gain on translation of
assets and liabilities in foreign currencies ........ 5,068
--------- --------- --------- --------- ---------
Net realized and unrealized gain on
investments and foreign currency .................. 717 121,706 670,560 659,544 351,123
--------- --------- --------- --------- ---------
Net increase in net assets
from operations ...................................... $ 57,047 $ 196,839 $ 711,478 $ 683,348 $ 384,032
========= ========= ========= ========= =========
</TABLE>
See notes to financial statements.
47
<PAGE> 50
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
FOR THE PERIOD JANUARY 3, 1995 (COMMENCEMENT OF OPERATIONS) TO DECEMBER 31, 1995
<TABLE>
<CAPTION>
RESOLUTE
TREASURY RESOLUTE RESOLUTE
MONEY RESOLUTE RESOLUTE SMALL INTERNATIONAL
MARKET BOND EQUITY COMPANY EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
---------- ---------- ---------- ---------- -------------
<S> <C> <C> <C> <C> <C>
INCREASE IN NET ASSETS
From operations:
Net investment income .......................... $ 56,330 $ 75,133 $ 40,918 $ 23,804 $ 32,909
Net realized gain (loss) on
investments ................................... 78 28,160 280,654 407,597 (14,394)
Net realized gain from foreign
currency transactions ......................... 110,274
Net unrealized gain on investments ............. 639 93,546 389,906 251,947 250,175
Net unrealized gain on translation
of assets and liabilities in foreign currency . 5,068
---------- ---------- ---------- ---------- ----------
Net increase in net assets
resulting from operations ..................... 57,047 196,839 711,478 683,348 384,032
Dividends to shareholders from
net investment income ......................... (56,330) (75,133) (40,918) (23,804) (32,909)
Dividends to shareholders in excess of
net investment income ......................... (38,008)
Distributions to shareholders from realized
capital gains ................................. (78) (26,117) (207,654) (288,564) (67,460)
Increase in net assets derived from
shareholder transactions (Note E) ............. 1,272,283 1,321,095 3,681,542 2,165,268 3,746,610
---------- ---------- ---------- ---------- ----------
Net increase in net assets ..................... 1,272,922 1,416,684 4,144,448 2,536,248 3,992,265
Net Assets:
Beginning of year ............................. 10 10 10 10 10
---------- ---------- ---------- ---------- ----------
End of year ................................... $1,272,932 $1,416,694 $4,144,458 $2,536,258 $3,992,275
========== ========== ========== ========== ==========
Accumulated net investment loss ............... $ 0 $ 0 $ 0 $ 0 $ (17,118)
========== ========== ========== ========== ==========
</TABLE>
See notes to financial statements.
48
<PAGE> 51
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
December 31, 1995
NOTE A--ORGANIZATION
Chubb Series Trust (the "Trust") is an open-end management investment company
registered under the Investment Company Act of 1940. The Trust was organized as
a Delaware Business Trust on October 28, 1993 for the purpose of funding
Flexible Premium Variable Life Insurance Policies issued by Chubb Life Insurance
Company of America ("Chubb Life"). The Trust is composed of five separate
portfolios: the Resolute Treasury Money Market Portfolio, the Resolute Bond
Portfolio, the Resolute Equity Portfolio, the Resolute Small Company Portfolio
and the Resolute International Equity Portfolio Chubb Life's ownership at
December 31, 1995 is as follows:
<TABLE>
<CAPTION>
PERCENTAGE OF
PORTFOLIO SHARES OWNED SHARES OUTSTANDING
<S> <C> <C>
Resolute Treasury Money Market Portfolio ............. 100,001 79.05%
Resolute Bond Portfolio .............................. 100,001 76.98%
Resolute Equity Portfolio ............................ 100,001 30.48%
Resolute Small Company Portfolio ..................... 200,001 93.32%
Resolute International Equity Portfolio .............. 200,001 54.41%
</TABLE>
NOTE B--SIGNIFICANT ACCOUNTING POLICIES
Valuation of Investments: An equity security listed on a stock exchange is
valued at the closing sale price on the exchange on which such security is
principally traded. If no sale took place, the mean of the bid and asked prices
at the close of trading is used. A security not listed on a stock exchange is
valued at the closing sale price as reported on a readily available market
quotation system, or, if no sales took place, the mean of the bid and asked
prices at the close of trading in the over-the-counter market. Quotations of
foreign securities in foreign currencies are converted to U.S. dollar
equivalents using appropriately translated foreign market closing prices.
Securities listed on a foreign exchange are valued at the last quoted sale price
available before the time when net assets are valued. Securities or other assets
for which market quotations are not readily available are valued at fair value
in accordance with procedures established by the Portfolio's Trustees. All
portfolio securities with a remaining maturity of less than 60 days are valued
by the amortized cost method which approximates market value. U.S. Treasury
securities and other obligations issued or guaranteed by the U.S. Government,
its agencies, or instrumentalities with remaining maturities of more than 60
days, are valued at representative quoted prices from bond pricing services.
Long-term publicly traded corporate bonds are valued at prices obtained from a
bond pricing service when such prices are available or, when appropriate, from
broker-dealers who make a market in those securities.
Trading in securities on most foreign exchanges and over-the-counter markets is
normally completed before the close of the domestic market and may also take
place on days on which the domestic market is closed. If events materially
affecting the value of foreign securities occur between the time when the
exchange on which they are traded closes and the time when the Portfolio's net
asset value is calculated, such securities will be valued at fair value in
accordance with procedures established by and under the general supervision of
the Portfolio's Trustees.
49
<PAGE> 52
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
NOTE B--SIGNIFICANT ACCOUNTING POLICIES -- (CONTINUED)
The books and records of the Portfolios are maintained in U.S. dollars. The
market values of investment securities, other assets and liabilities and forward
contracts stated in foreign currencies are translated at the prevailing exchange
rates at the end of the period. Purchases, sales, income and expense are
translated at the exchange rate prevailing on the respective dates of such
transactions.
Since the net assets of the Portfolios are presented at the exchange rates and
market values prevailing at the end of the period, the Portfolios do not isolate
the portion of the results of operations arising as a result of changes in
foreign exchange rates on securities from the fluctuations arising from changes
in the market prices of securities held during the period. Such fluctuations are
included with the net realized and unrealized gain or loss from investments.
Reported net realized gain or loss from foreign currency transactions arise from
sales and maturities of short-term securities, sales of foreign currencies,
currency gains or losses realized between the trade and settlement dates on
securities transactions, the difference between the amounts of dividends,
interest, and foreign withholding taxes recorded on the Portfolio's books, and
the U.S. dollar equivalent of the amounts actually received or paid. Net
unrealized gain or loss from foreign currency transactions arises from changes
in the value of assets and liabilities other than investments in securities at
fiscal year end, resulting from changes in the exchange rate.
The Portfolios may enter into forward foreign currency contracts to protect
securities and related receivables and payables against fluctuations in future
foreign currency rates. A forward contract is an agreement to buy or sell
currencies of different countries on a specified future date at a specified
rate. Risks associated with such contracts include the movement in the value of
the foreign currency relative to the U.S. dollar and the ability of the
counterparty to perform. The market value of the contract will fluctuate with
changes in currency exchange rates. Contracts are valued daily and the change in
the market value is recorded by the Portfolio as unrealized appreciation or
depreciation of foreign currency translations. At December 31, 1995, the
Resolute International Equity Portfolio had the following open forward foreign
currency contracts:
SUMMARY OF OPEN FORWARD FOREIGN CURRENCY CONTRACTS
<TABLE>
<CAPTION>
U.S. DOLLAR
FOREIGN CURRENCY CONTRACTS TO VALUE AT NET UNREALIZED
SALE CONTRACTS SETTLEMENT DATE DELIVER COST 12/31/95 APPRECIATION
- ---------------- --------------- ------------ -------- ----------- --------------
<S> <C> <C> <C> <C> <C>
Japanese Yen 02/16/96 25,515,100 $254,896 $249,716 $5,180
</TABLE>
Security Transactions and Investment Income: Security transactions are recorded
on a trade date basis. Realized gains and losses on investments sold are
recorded on the basis of the first-in, first-out method. Interest income,
including, where applicable, amortization of discount on investments, is
recorded on the accrual basis. Dividend income is recorded on the ex-dividend
date, except for certain dividends from foreign securities, which are recorded
as soon as the Portfolios are informed of the dividend.
50
<PAGE> 53
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
NOTE B--SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
Dividends and Distributions to Shareholders: Dividends and distributions to
shareholders from ordinary income and net realized capital gains are declared
and distributed at least once annually. The Trust distinguishes between
dividends on a tax basis and a financial reporting basis and only distributions
in excess of tax basis earnings and profits are reported in the financial
statements as a return of capital. Differences in the recognition or
classification of income between the financial statements and tax earnings and
profits which result in temporary over-distributions for financial statements
purposes are classified as dividends in excess of net investment income or
accumulated net realized gains.
Federal Taxes: It is the policy of the Trust that each Portfolio intends to
qualify as a regulated investment company by complying with the requirements of
the Internal Revenue Code applicable to regulated investment companies, and by
distributing substantially all of its taxable earnings to its shareholders.
Therefore, no Federal tax provision is required.
NOTE C--INVESTMENTS
Net realized gains and losses on investment securities sold
are determined by using the first-in, first-out method. The aggregate cost of
investments owned for Federal income tax purposes is the same as for financial
reporting purposes.
As of December 31, 1995, gross unrealized gains and losses were as follows:
<TABLE>
<CAPTION>
GROSS GROSS NET
UNREALIZED UNREALIZED UNREALIZED
GAINS LOSSES GAIN
---------- ---------- ----------
<S> <C> <C> <C>
Resolute Treasury Money Market Portfolio ..... $ 639 $ 0 $ 639
Resolute Bond Portfolio ...................... 93,546 0 93,546
Resolute Equity Portfolio .................... 509,673 119,767 389,906
Resolute Small Company Portfolio ............. 370,110 118,163 251,947
Resolute International Equity Portfolio ...... 374,652 124,477 250,175
</TABLE>
As of December 31, 1995, the International Equity Portfolio had an unrealized
foreign currency gain of $5,068.
51
<PAGE> 54
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
NOTE C--INVESTMENTS--(CONTINUED)
Purchases and sales of investment securities for the period from January 3, 1995
(commencement of operations) to December 31, 1995, other than short-term
obligations, were as follows:
<TABLE>
<CAPTION>
PROCEEDS
COST OF FROM
INVESTMENT INVESTMENT
SECURITIES SECURITIES
PURCHASED SOLD
---------- ----------
<S> <C> <C>
Resolute Bond Portfolio ........................ $4,149,369 $2,872,477
Resolute Equity Portfolio ...................... 5,350,138 1,820,421
Resolute Small Company Portfolio ............... 4,423,330 2,314,847
Resolute International Equity Portfolio ........ 5,789,915 2,081,457
</TABLE>
NOTE D--INVESTMENT ADVISORY FEES, MANAGEMENT AGREEMENTS
The Trust has entered into an investment management agreement with Chubb
Investment Advisory Corporation, ("Chubb Investment"), a wholly-owned subsidiary
of Chubb Life. Under the agreement, Chubb Investment provides investment
management, administrative and transfer agency services for the Trust. Chubb
Investment is paid a fee for its services, computed daily and paid monthly, at
the annual rate of: .40% of average daily net assets of the Resolute Treasury
Money Market Portfolio; .50% of average daily net assets of the Resolute Bond
Portfolio; .60% of average daily net assets of the Resolute Equity Portfolio;
.80% of average daily net assets of the Resolute Small Company Portfolio, and
.80% of average daily net assets of the Resolute International Equity Portfolio.
Morgan Guaranty Trust Company of New York ("Morgan") serves as sub-investment
manager to the Trust, providing investment advice and management services for
each Portfolio. As compensation for its services, Morgan is entitled to receive
fees from Chubb Investment (and not from the Portfolios), computed daily and
paid monthly, at an annual rate of: .20% of average daily net assets of the
Resolute Treasury Money Market Portfolio; .30% of average daily net assets of
the Resolute Bond Portfolio; .40% of average daily net assets of the Resolute
Equity Portfolio; .60% of average daily net assets of the Resolute Small Company
Portfolio, and .60% of the average daily net assets of the Resolute
International Equity Portfolio.
Chubb Life and Morgan have agreed that until January 1, 1997 they will each
assume 50% of the expenses of each Portfolio of the Trust in excess of .60%,
.75%, .90%, 1.15% and 1.20% of the average daily net assets, respectively, of
the Resolute Treasury Money Market, Bond, Equity, Small Company and
International Equity Portfolios.
52
<PAGE> 55
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
NOTE E--SHAREHOLDERS TRANSACTIONS
Following is a summary of transactions with shareholders for each Portfolio
for the period from January 3, 1995 (commencement of operations) to
December 31, 1995.
<TABLE>
<CAPTION>
RESOLUTE TREASURY MONEY MARKET PORTFOLIO
SHARES DOLLARS
------- -----------
<S> <C> <C>
Shares sold ......................... 146,904 $ 1,483,290
Shares redeemed ..................... (20,405) (211,007)
------- -----------
Net increase ....................... 126,499 $ 1,272,283
======= ===========
<CAPTION>
RESOLUTE BOND PORTFOLIO
SHARES DOLLARS
------- -----------
<S> <C> <C>
Shares sold ......................... 132,729 $ 1,351,277
Shares redeemed ..................... (2,830) (30,182)
------- -----------
Net increase ....................... 129,899 $ 1,321,095
======= ===========
<CAPTION>
RESOLUTE EQUITY PORTFOLIO
SHARES DOLLARS
------- -----------
<S> <C> <C>
Shares sold ......................... 332,783 $ 3,738,063
Shares redeemed ..................... (4,714) (56,521)
------- -----------
Net increase ....................... 328,069 $ 3,681,542
======= ===========
</TABLE>
53
<PAGE> 56
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
NOTE E--SHAREHOLDERS' TRANSACTIONS--(CONTINUED)
<TABLE>
<CAPTION>
RESOLUTE SMALL COMPANY PORTFOLIO
SHARES DOLLARS
------- -----------
<S> <C> <C>
Shares sold ........................... 215,696 $ 2,181,106
Shares redeemed ....................... (1,373) (15,838)
------- -----------
Net increase ........................ 214,323 $ 2,165,268
======= ===========
<CAPTION>
RESOLUTE INTERNATIONAL EQUITY PORTFOLIO
SHARES DOLLARS
------- -----------
<S> <C> <C>
Shares sold ........................... 373,752 $ 3,810,249
Shares redeemed ....................... (6,197) (63,639)
------- -----------
Net increase ........................ 367,555 $ 3,746,610
======= ===========
</TABLE>
NOTE F--ORGANIZATION COSTS
Costs incurred in connection with the initial organization of the Trust are
being amortized on a straight-line basis over a period of five years. At
December 31, 1995, the balances reported as deferred organization costs are
payable to Chubb America Service Corp., an affiliated entity, and have been
included as a liability in the Statement of Assets and Liabilities.
54
<PAGE> 57
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD FROM JANUARY 3, 1995 (COMMENCEMENT
OF OPERATIONS) TO DECEMBER 31, 1995
<TABLE>
<CAPTION>
RESOLUTE
TREASURY RESOLUTE RESOLUTE
MONEY RESOLUTE RESOLUTE SMALL INTERNATIONAL
MARKET BOND EQUITY COMPANY EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
---------- ---------- ---------- ---------- -------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year . $ 10.00 $ 10.00 $ 10.00 $ 10.00 $ 10.00
INCOME FROM INVESTMENT
OPERATIONS
Net investment income ............ 0.45 0.58 0.12 0.11 0.15
Net gains on securities & foreign
currency (both realized
and unrealized) ................ 0.06 1.11 3.26 3.18 1.08
---------- ---------- ---------- ---------- ----------
Total from investment
operations ..................... 0.51 1.69 3.38 3.29 1.23
LESS DISTRIBUTIONS TO
SHAREHOLDERS
Dividends from net
investment income .............. (0.45) (0.58) (0.12) (0.11) (0.09)
Dividends in excess of net
investment income .............. (0.10)
Distributions from net
capital gains .................. 0.00 (0.20) (0.63) (1.35) (0.18)
---------- ---------- ---------- ---------- ----------
Total distributions ................ (0.45) (0.78) (0.75) (1.46) (0.37)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year ....... $ 10.06 $ 10.91 $ 12.63 $ 11.83 $ 10.86
========== ========== ========== ========== ==========
Total Return (A) ................... 5.09% 16.85% 33.91% 32.91% 12.38%
Ratios to average net assets:
(Annualized)
Expenses (B) ..................... 0.60% 0.75% 0.90% 1.15% 1.20%
Net investment income ............ 4.95% 6.00% 1.48% 0.99% 1.06%
Portfolio turnover rate ............ N/A 238.96% 65.60% 100.43% 68.00%
Net assets, at end of year ......... $1,272,932 $1,416,694 $4,144,458 $2,536,258 $3,992,275
</TABLE>
(A) Total return assumes reinvestment of all dividends during the period and
does not reflect deduction of account fees and changes. Investment returns
and principal values will fluctuate and shares, when redeemed, may be worth
more or less than the original cost. Total returns for periods of less than
one year have not been annualized.
(B) All related party fees have been waived and all other expenses of the
Portfolios have been assumed in part for 1995 by Chubb Life and Morgan. Had
the fees not been waived and expenses not been assumed, the ratios of
expenses to average net assets would have been 2.77%, 2.90%, 2.70%, 3.22%,
and 3.16% for the Resolute Treasury Money Market Portfolio, Resolute Bond
Portfolio, Resolute Equity Portfolio, Resolute Small Company Portfolio, and
Resolute International Equity Portfolio, respectively.
55
<PAGE> 58
CHUBB SERIES TRUST
- --------------------------------------------------------------------------------
INDEPENDENT AUDITORS REPORT
REPORT OF INDEPENDENT AUDITORS
To the Board of Directors and Shareholders
Chubb Series Trust
We have audited the accompanying statement of assets and liabilities of the
Chubb Series Trust (the "Trust," comprising, respectively, the Resolute
Treasury Money Market Portfolio, Resolute Bond Portfolio, Resolute Equity
Portfolio, Resolute Small Company Portfolio and Resolute International Equity
Portfolio), including the related schedules of portfolio investments on pages 4,
9, 10, 17, 18, 19, 27, 28, 29, 30, 31, 32, 33, 41, 42, 43, 44 and 45 of these
financial statements, as of December 31, 1995, and the related statement of
operations, statement of changes in net assets, and the financial highlights for
the period from January 3, 1995 (Commencement of Operations) to December 31,
1995. These financial statements and financial highlights are the responsibility
of the Trust's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our 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 December 31, 1995 by
correspondence with the custodian and brokers, or other appropriate auditing
procedures where replies from brokers were not received, or verification by
examination. 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, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the respective portfolios constituting the Chubb Series Trust at December 31,
1995, the results of their operations, the changes in their net assets and the
financial highlights for the period from January 3, 1995 (Commencement of
Operations) to December 31, 1995, in conformity with generally accepted
accounting principles.
/s/ ERNST & YOUNG LLP
Boston, Massachusetts
February 16, 1996
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