<PAGE>
Investment Advisers
United States Trust Company of New York
114 West 47th Street
New York, NY 10036
U.S. Trust Company of Connecticut
225 High Ridge Road
Stamford, CT 06905
U.S. Trust Company, N.A.
515 South Flower Street
Los Angeles, CA 90071
Transfer Agent
Chase Global Funds Services Company
73 Tremont Street
Boston, MA 02108
(800) 909-1989
Distributor
Edgewood Services, Inc.
5800 Corporate Drive
Pittsburgh, PA 15237
SHARES OF THE FUNDS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, ANY BANK, AND THE SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, BANK INSURANCE FUND, FEDERAL RESERVE BOARD, OR
ANY OTHER GOVERNMENTAL AGENCY. AN INVESTMENT IN A FUND IS SUBJECT TO RISK OF
PRINCIPAL.
US EXITIS A99
[GRAPHIC OMITTED]
Institutional Shares
EQUITY FUND
INCOME FUND
TOTAL RETURN BOND FUND
BALANCED FUND
INTERNATIONAL EQUITY FUND
OPTIMUM GROWTH FUND
VALUE EQUITY FUND
Annual Report
March 31, 1999
<PAGE>
LETTER TO SHAREHOLDERS
- --------------------------------------------------------------------------------
Dear Shareholder:
I am pleased to present the annual report for the Excelsior Funds. Fiscal
1999 was an exciting year in the financial markets as a whole and for the fund
family.
Low interest rates and subdued inflation in tandem with turbulent Asian
and Latin American markets proved to be the catalysts for another year of
strong -- though narrowly focused -- domestic equity performance. At the same
time, these factors combined to constrain the returns on fixed-income
investments to modest levels. The search for consistency and predictability
amidst uncertainty -- regarding heightened valuations here at home,
international economic crises, not to mention the course of the U.S. economy --
created a "flight to quality." Continuing the dominant trend of the past few
years, investors redirected much of their money to a relatively small group of
extremely large-capitalized growth companies within the Standard & Poor's 500
Index, leaving the broader market lagging well behind. As a result, small and
mid-sized companies as well as value-oriented investments underperformed
relative to growth-oriented investments. This environment made it difficult for
broadly diversified equity portfolios to meet or exceed the performance of this
narrowly focused market.
On the international front, economic crises and inflationary pressures in
Asia, Eastern Europe, and Latin America temporarily disrupted equity markets
around the world. Many of these troubled economies -- and widespread investor
concerns about them -- have begun to turn around and are showing sign of
recovery. In Western Europe, equity performance in general was strong, and the
conversion to a single currency, the Euro, was completed on time and without
disrupting the financial markets.
The financial markets will present many challenges and opportunities
during the coming year. U.S. fiscal policy continues to be effective in keeping
inflation under control, and we continue to be cautiously optimistic regarding
the domestic equity markets. International markets, while remaining attractive
on a long-term basis, will require continuous evaluation. In our new global
economy, events in international markets will have a direct impact on the U.S.
economy.
I am confident that the Excelsior fund family will continue to provide you
with the appropriate investment vehicles to respond to the always-changing
economic/financial market environment and to pursue your long-term investment
objectives.
Sincerely,
/s/ Frederick S. Wonham
-----------------------------
Frederick S. Wonham
Chairman of the Board and
President
<PAGE>
EXCELSIOR INSTITUTIONAL TRUST
ADVISER'S MARKET REVIEW
- --------------------------------------------------------------------------------
For the fiscal year ended March 31, 1999, global financial market
performance was mixed. In the U.S., despite some volatility, the equity markets
posted another year of well-above-average gains. Domestic fixed-income markets
saw solid advances as well. International equity markets, however, diverged
considerably. Europe overall proved somewhat sluggish. Asia and Latin America
grappled with severe headwinds through much of the year, though Asian markets
in general saw considerable recovery in the second half of the fiscal year.
Although the U.S. economy remained surprisingly strong and inflation
subdued, the domestic equity market did import some volatility in the past
fiscal year -- in the form of Asian economic concerns, Russia's devaluation of
the ruble and defaulting on local currency debt, etc. Nevertheless, the general
direction of domestic equities was decidedly upward. However, market leadership
during this period remained concentrated in the broad technology area --
specifically, a small number of high-quality globally dominant
large-capitalization technology concerns. Small-capitalization stocks
underperformed their mid- and larger-capitalization brethren throughout the
year -- one exception being a mounting Internet stock feeding frenzy as the
year progressed. Among the weakest sectors were real estate and energy.
Recently, however, we have begun to see what appears to be a broadening of the
market and perhaps the beginnings of a shift away from recent market favorites
and into beaten-down but economically sensitive cyclical issues and even some
long-suffering small caps. Is this shift sustainable? No one knows for sure.
But for us at U.S. Trust, it's not critical. Whether what we're seeing now is
temporary or long lasting, we will continue to implement our long-standing
investment policy -- that is, an unwavering focus on long-term fundamental
value, thorough portfolio diversification, and selective concentration on
stocks and areas that we believe offer outstanding promise. We believe we have
done this with some considerable degree of success in the past and, with
continued effort and vigilance, hope to do so in the future.
European equity markets endured a roller-coaster year. Conditions worsened
throughout the first half, in particular for Eastern Europe. The third fiscal
quarter saw a positive shift as several peripheral European countries lowered
rates. This didn't last, however, as markets languished in the fourth fiscal
quarter due to deteriorating economic growth forecasts. Nevertheless, we feel
the outlook for Europe remains bright. A recent interest-rate cut and increased
spending from European leftist governments should fuel consumption growth,
which will underpin economic expansion, in the latter part of 1999.
Asian equity markets, particularly the emerging markets, unraveled in the
first two fiscal quarters as investors realized that some of the proposed fixes
for the economic crisis would be insufficient or take time to have an impact.
In the third fiscal quarter, however, Asian equities staged a rebound, and
strong -- if volatile -- performances continued in the final fiscal quarter.
Although some risk remains in Japan and Hong Kong, we believe that most Asian
markets will reflect the strengthening economic situations that we envision
throughout the new fiscal year.
Latin American equity markets were battered throughout the first half,
impacted by difficulties in international markets. Recovering somewhat in the
fiscal third quarter, Latin American markets benefited from Brazilian President
Cardoso's re-election, announcement of a fiscal adjustment program, and
approval of an IMF-led financing package. However, Congressional defeat of one
of the measures
<PAGE>
EXCELSIOR INSTITUTIONAL TRUST
ADVISER'S MARKET REVIEW (Continued)
- --------------------------------------------------------------------------------
re-ignited skepticism, and Latin American markets sold off in December. In the
fiscal fourth quarter, the Brazilian devaluation led to a deterioration in the
macroeconomic outlook. However, encouraging signs have surfaced in Brazil,
which has led to a strengthening of the currency, an interest-rate decline, and
a dampening of inflation expectations. Looking ahead, we expect the region's
economic growth to slow in calendar 1999. Still, this slowing is necessary to
reduce Latin America's financing needs in the face of less liquid international
capital markets. Furthermore, the fiscal adjustment programs, while painful
now, should establish a better foundation for future growth.
The fixed-income markets, on the other hand, had another strong fiscal
year, though volatility was pronounced. The tug of war between domestic
inflationary forces and the crisis in Asia continued unabated in the first two
quarters of the fiscal year. The taxable market and the long end of the
Treasury market proved strong. Shrinkage in the supply of Treasury issues left
the market with insufficient liquidity to hedge exposure elsewhere,
exacerbating demand. Consequently, Treasuries left other fixed-income
categories, such as municipals and mortgage-backed securities, far behind in
the rally.
In the fiscal third quarter, fears mounted that global problems would blow
up, that liquidity would dry up, and/or that the domestic economy would slow.
In response, the Federal Reserve elected to lower interest rates several times.
At the same time, many of the global problems were being acknowledged and -- if
not solved -- at least being addressed. Stocks, which had stumbled earlier in
the year, rallied. Bonds, which had already had an excellent (if volatile)
year, marked time, and this continued through year end.
Looking forward, we remain cautiously optimistic. Continued low inflation
and favorable technical factors point toward a relatively narrow trading range
in the months ahead, and perhaps lower interest rates looking further out.
<PAGE>
ADVISER'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST EQUITY FUND
- --------------------------------------------------------------------------------
For the twelve months ended March 31, 1999, the Fund realized a total return of
20.13%*, versus 18.46%** for the Standard & Poor's 500 Composite Stock Price
Index. Our investment strategy remained consistent throughout the year; that
is, we emphasized a long-term investment horizon (as opposed to attempts at
timing the market), broad portfolio diversification across strategies and
investment themes, and solid good business values -- that is, companies we feel
have demonstrated and continue to demonstrate solid growth in a volatile
environment. Through the first three fiscal quarters, the portfolio's best
performers included Cisco Systems, Microsoft and Intel in the technology group,
MCI WorldCom and Time Warner and within the drug group, Schering-Plough and
Pfizer. McDonald's also turned in a strong performance. Laggards included a few
of the mid-size companies (Thermo Electron, Raychem and Lear); Mattel, which
had a poor Christmas season; and financial services and energy companies. For
the final quarter, the portfolio's best performers included America Online,
Microsoft, Cisco Systems and EMC Corp. in the technology group as well as MCI
WorldCom in the communication services area. Morgan Stanley Dean Witter and
American International Group led the financial services area, while Gillette,
Time Warner and CBS turned in strong performances among the consumer stocks.
Also, Pioneer Hi-Bred agreed to be acquired by Du Pont, resulting in a
significant rise. Laggards included two small energy related companies
(Petroleum Geo-Services and Ocean Energy Inc.), which were hurt by weak oil
prices, and AES Corp., a global power company, which was victimized by weakness
in the emerging markets.
S&P 500
Composite Stock Price Index** Equity Fund
----------------------------- -----------
1/16/95 $10,000 $10,000
3/31/95 $10,970 $10,570
3/31/96 $14,490 $12,388
3/31/97 $17,380 $14,294
3/31/98 $25,690 $21,667
3/31/99 $30,430 $26,028
-------------------------------------------------
| Equity Fund+ |
|-------------------------------------------------|
| Average Annual Total Return |
| Ended on 3/31/99* |
|-------------------------------------------------|
| 1 year | Since Inception (1/16/95) |
|---------------|---------------------------------|
| 20.13% | 25.54% |
-------------------------------------------------
Past performance is not predictive of future performance. Investment returns
and principal values will vary and shares may be worth more or less at
redemption than their original cost.
The above illustration compares a $10,000 investment made in Equity Fund
and a broad-based index since 1/16/95 (inception date). For comparative
purposes, the value of the index on 12/31/94 is used as the beginning value on
1/16/95. All dividends and capital gain distributions are reinvested. The
Fund's performance takes into account fees and expenses. The index does not
take into account charges, fees and other expenses. Further information
relating to Fund performance is contained in the Financial Highlights section
of the Prospectus and elsewhere in this report.
- ------------
* Total return represents the change during the period in a hypothetical
account with dividends reinvested.
** Source: Standard & Poor's Corporation--Reflects the reinvestment of income
dividends and, where applicable, capital gain distributions. The Standard &
Poor's 500 Composite Stock Price Index is a widely accepted unmanaged index
of U.S. stock market performance.
+ The Fund is currently waiving certain fees. Had the Fund not waived fees,
returns would have been lower. This voluntary waiver may be modified or
terminated at any time.
<PAGE>
ADVISER'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST INCOME FUND
- --------------------------------------------------------------------------------
For the fiscal year ended March 31, 1999, the Fund achieved a total return of
5.94%* versus 6.56%** for the Lehman Brothers Intermediate Govt/Corp Bond Index
and for the same period ranked 31 out of 154 funds, based on total return, in
the Lipper Corporate Debt A-Rated category.*** In the beginning months of the
fiscal year, the Fund's overweight position in slightly longer maturities
(relative to its benchmark and most competitors) contributed meaningfully to
performance as long maturity issues outpaced shorter maturities in the period.
At that time, we increased the Fund's representation among high-grade
commercial and mortgage-backed corporate securities with an eye toward boosting
the portfolio's yield. The Fund benefited as rates dropped and the yield curve
grew steeper in the second fiscal quarter. Throughout the period we emphasized
high-quality securities (nothing below A-rated). We also used agency paper more
extensively for greater yield potential. This positioning proved successful in
the third fiscal quarter, as the overweight position in agency, corporate and
mortgage securities provided increased income and price gains relative to
Treasuries. Heading into the final fiscal quarter, the third-quarter trend
reversed, and lower-quality securities outperformed their higher-quality peers.
This detracted from the Fund's performance, given its overallocation of
high-quality securities. Also, the Fund's slightly longer duration proved to be
no advantage for the three months, though its overweight in mortgage-backed and
commercial mortgages -- which tightened relative to Treasuries -- did prove a
positive. Looking ahead to the new fiscal year, we remain cautiously optimistic
regarding market prospects in general, yet confident in the Fund's structure
and strategy.
Lehman Brothers Intermediate
Govt/Corp Bond Index** Income Fund
---------------------------- -----------
1/16/95 $10,000 $10,000
3/31/95 $10,444 $10,301
3/31/96 $11,440 $11,232
3/31/97 $11,990 $11,691
3/31/98 $13,140 $13,068
3/31/99 $14,005 $13,844
-------------------------------------------------
| Income Fund+ |
|-------------------------------------------------|
| Average Annual Total Return |
| Ended on 3/31/99* |
|-------------------------------------------------|
| 1 year | Since Inception (1/16/95) |
|---------------|---------------------------------|
| 5.94% | 8.04% |
-------------------------------------------------
Past performance is not predictive of future performance. Investment returns
and principal values will vary and shares may be worth more or less at
redemption than their original cost.
The above illustration compares a $10,000 investment made in Income Fund
and a broad-based index since 1/16/95 (inception date). For comparative
purposes, the value of the index on 12/31/94 is used as the beginning value on
1/16/95. All dividends and capital gain distributions are reinvested. The
Fund's performance takes into account fees and expenses. The index does not
take into account charges, fees and other expenses. Further information
relating to Fund performance is contained in the Financial Highlights section
of the Prospectus and elsewhere in this report.
- ------------
* Total return represents the change during the period in a hypothetical
account with dividends reinvested.
** Source: Lehman Brothers -- Lehman Brothers Intermediate Govt/Corp Bond
Index is an unmanaged total return performance benchmark comprised of U.S.
Government agencies and U.S. Treasury securities and investment grade
corporate debt, selected as representative of the market with maturities of
one to ten years.
*** Source: Lipper Analytical Services, Inc. -- Lipper is an independent mutual
fund performance monitor.
+ The Fund is currently waiving certain fees. Had the Fund not waived fees,
returns would have been lower. This voluntary waiver may be modified or
terminated at any time.
<PAGE>
ADVISER'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST TOTAL RETURN BOND FUND
- --------------------------------------------------------------------------------
For the fiscal year ended March 31, 1999, the Fund achieved a total return of
6.07%* versus 6.54%** for the Lehman Brothers Govt/Corp Bond Index and for the
same period ranked 21 out of 154 funds, based on total return, in the Lipper
Corporate Debt A-Rated category.*** In the first fiscal quarter, the Fund
benefited from its overweight position in slightly longer maturities relative
to the benchmark, as long maturity issues outperformed shorter maturities in
the period. At that time, we also moved to increase the Fund's weight in
high-grade corporate securities, commercial and mortgage-backed, to pursue
increased yield on the portfolio. The Fund benefited during the second fiscal
quarter, as rates declined and the yield curve grew steeper. During the third
fiscal quarter, the Fund performed roughly in line with its peer group. The
reasons? An over allocation to AAA-rated mortgages and an under allocation to
lower-quality corporate debt offset each other in the period. We maintained an
average duration in line with the benchmark. Heading into the final quarter of
the fiscal year, and reversing the previous quarter's trend, lower-quality
securities outperformed their higher-quality counterparts. This had a negative
impact on the Fund, which maintained a large over allocation of very
high-quality asset-backed and mortgage-backed securities. The Fund was also
positioned with a slightly longer duration than its competitors, which proved
to be no advantage during the three-month period. On the positive front, the
portfolio was overweighted in mortgage-backed securities and commercial
mortgages, which tightened relative to Treasuries in the period. We remain
confident in the Fund's structure and strategy going forward.
Lehman Brothers
Govt/Corp Bond Index** Total Return Bond Fund
---------------------------- ----------------------
1/19/95 $10,000 $10,000
3/31/95 $10,500 $10,320
3/31/96 $11,650 $11,515
3/31/97 $12,160 $12,002
3/31/98 $13,670 $13,467
3/31/99 $14,565 $14,284
-------------------------------------------------
| Total Return Bond Fund+ |
|-------------------------------------------------|
| Average Annual Total Return |
| Ended on 3/31/99* |
|-------------------------------------------------|
| 1 year | Since Inception (1/19/95) |
|---------------|---------------------------------|
| 6.07% | 8.87% |
-------------------------------------------------
Past performance is not predictive of future performance. Investment returns
and principal values will vary and shares may be worth more or less at
redemption than their original cost.
The above illustration compares a $10,000 investment made in Total Return
Bond Fund and a broad-based index since 1/19/95 (inception date). For
comparative purposes, the value of the index on 12/31/94 is used as the
beginning value on 1/19/95. All dividends and capital gain distributions are
reinvested.
The Fund's performance takes into account fees and expenses. The index does not
take into account charges, fees and other expenses. Further information
relating to Fund performance is contained in the Financial Highlights section
of the Prospectus and elsewhere in this report.
- ------------
* Total return represents the change during the period in a hypothetical
account with dividends reinvested.
** Source: Lehman Brothers -- Lehman Brothers Govt/Corp Bond Index is an
unmanaged total return performance benchmark comprised of U.S. Government
agencies and U.S. Treasury securities and investment grade corporate debt,
selected as representative of the market.
*** Source: Lipper Analytical Services, Inc. -- Lipper is an independent mutual
fund performance monitor.
+ The Fund is currently waiving certain fees. Had the Fund not waived fees,
returns would have been lower. This voluntary waiver may be modified or
terminated at any time.
<PAGE>
ADVISER'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST BALANCED FUND
- --------------------------------------------------------------------------------
For the twelve months ended March 31, 1999 the Fund realized a negative total
return of (4.84)%* compared to positive 18.46%** for the Standard & Poor's 500
Composite Stock Price Index ("S&P 500") and positive 6.48%*** for the Lehman
Brothers Aggregate Bond Index. During the year the Fund's performance was
impacted by style (value vs. growth), market capitalization (large vs.
mid/small), and sector exposure (the Fund was overweighted in energy, basic
materials, and manufacturing stocks). The Fund manager emphasized small and mid
cap names during the year, with an emphasis on some of the sectors that
underperformed the market. The Fund has little exposure to the leading sectors,
such as technology, communications services and consumer goods. The Fund ended
the year with an asset allocation of 51% equity, 34% fixed income and 15% cash.
At the end of the year the S&P 500 was trading at a P/E multiple of 27.5x,
while the Fund traded at an average 14.9x. The Fund manager continues to invest
the equity portion of the Fund in the value style, seeking low P/E stocks.
<TABLE>
<CAPTION>
Standard & Poor's 500 Composite Lehman Brothers
Balanced Fund Stock Price Index** Aggregate Bond Index***
------------- ------------------------------ -----------------------
<S> <C> <C> <C>
7/11/94 $10,000 $10,000 $10,000
3/31/95 $10,819 $11,504 $10,609
3/31/96 $12,978 $15,195 $11,752
3/31/97 $14,267 $18,202 $12,329
3/31/98 $17,851 $26,934 $13,808
3/31/99 $16,987 $31,905 $14,702
</TABLE>
-------------------------------------------------
| Balance Fund+ |
|-------------------------------------------------|
| Average Annual Total Return |
| Ended on 3/31/99* |
|-------------------------------------------------|
| 1 year | Since Inception (7/11/94) |
|---------------|---------------------------------|
| (4.84)% | 11.86% |
-------------------------------------------------
Past performance is not predictive of future performance. Investment returns
and principal values will vary and shares may be worth more or less at
redemption than their original cost.
The above illustration compares a $10,000 investment made in Balanced Fund
and two broad-based indices since 7/11/94 (inception date). For comparative
purposes, the value of the indices on 6/30/94 is used as the beginning value on
7/11/94. All dividends and capital gain distributions are reinvested.
The Fund's performance takes into account fees and expenses. The indices do not
take into account charges, fees and other expenses. Further information
relating to Fund performance is contained in the Financial Highlights section
of the Prospectus and elsewhere in this report.
- ------------
* Total return represents the change during the period in a hypothetical
account with dividends reinvested.
** Source: Standard & Poor's Corporation -- Reflects the reinvestment of
income dividends and, where applicable, capital gain distributions. The
Standard & Poor's 500 Composite Stock Price Index is a widely accepted
unmanaged index of U.S. stock market performance.
*** Source: Lehman Brothers -- Lehman Brothers Aggregate Bond Index is an
unmanaged total return performance benchmark commonly used to measure bond
performance. The Index is made up of Lehman's Govt/Corp Bond Index,
Mortgage-Backed Securities Index and Asset-Backed Securities Index which are
comprised of U.S. Government agencies and U.S. Treasury securities,
investment grade corporate debt, mortgage-backed and asset-backed
securities, selected as representative of the market.
+ The Fund is currently waiving certain fees. Had the Fund not waived fees,
returns would have been lower. This voluntary waiver may be modified or
terminated at any time.
<PAGE>
ADVISER'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
For the twelve months ended March 31, 1999, the Fund realized a total return of
negative (6.60)%* versus positive 3.88%** for the FT/S&P-Actuaries World
Indices -- World Excluding U.S. Index. During the first half of the fiscal
year, the Fund's European holdings proved most resilient, though the
portfolio's essential absence of deep cyclicals didn't help (this was
intentional, as we are oriented more toward long-term sustainable growth and
believe our approach should bring greater rewards over time). Our decision to
hold nothing in Malaysia and Hong Kong proved correct. The Fund's Latin
American holdings hurt performance in the period. Regarding portfolio activity,
we continued to focus on domestic-oriented European companies. We also added
cautiously to several of our Asian holdings with, in our opinion, compelling
valuations and growth rates. We did reduce some of the Fund's Latin American
holdings. During the second half, the Fund benefited from its holdings in
emerging markets in general, and from those in Southeast Asia in particular,
but suffered from exposure to European cyclical companies. The Fund was also
hurt by its exposure to small and medium sized companies, which generally
underperformed larger companies in the period. The Fund ended the year with
large stakes in France, the Netherlands, the United Kingdom, and Japan and
maintained a significant presence in the peripheral markets of Spain, Portugal,
Ireland, and Italy. We believe these markets will enjoy high economic growth,
and companies will benefit from merger and acquisition activity, which should
lead to cost-cutting as synergies are exploited and market positions are
improved in what we feel are still very fragmented industries.
FT/S&P-Actuaries World Indices--
World Excluding U.S. Index** International Equity Fund
---------------------------- -------------------------
1/24/95 $10,000 $10,000
3/31/95 $10,090 $10,386
3/31/96 $11,370 $12,787
3/31/97 $11,570 $13,440
3/31/98 $13,560 $14,771
3/31/99 $14,084 $13,797
-------------------------------------------------
| International Equity Fund+ |
|-------------------------------------------------|
| Average Annual Total Return |
| Ended on 3/31/99* |
|-------------------------------------------------|
| 1 year | Since Inception (1/24/95) |
|---------------|---------------------------------|
| (6.60)% | 7.99% |
-------------------------------------------------
Past performance is not predictive of future performance. Investment returns
and principal values will vary and shares may be worth more or less at
redemption than their original cost.
International investing is subject to special risks such as currency
fluctuations and differences in accounting and taxation standards.
The above illustration compares a $10,000 investment made in International
Equity Fund and a broad-based index since 1/24/95 (inception date). For
comparative purposes, the value of the index on 12/31/94 is used as the
beginning value on 1/24/95. All dividends and capital gain distributions are
reinvested. The Fund's performance takes into account fees and expenses. The
index does not take into account charges, fees and other expenses. Further
information relating to Fund performance is contained in the Financial
Highlights section of the Prospectus and elsewhere in this report.
- ------------
* Total return represents the change during the period in a hypothetical
account with dividends reinvested.
** Source: Goldman Sachs--The FT/S&P-Actuaries World Indices--World Excluding
U.S. Index is a widely accepted, unmanaged index of global stock market
performance, including Canada, Mexico, Europe, Australia, New Zealand,
South Africa and the Far East. The Index includes dividends reinvested.
+ The Fund is currently waiving certain fees. Had the Fund not waived fees,
returns would have been lower. This voluntary waiver may be modified or
terminated at any time.
<PAGE>
ADVISER'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST OPTIMUM GROWTH FUND
- --------------------------------------------------------------------------------
For the twelve months ended March 31, 1999, the Fund realized a total return of
68.74%*, strongly out pacing The Russell 1000 Growth Index's return of
28.06%,**** and ranked fifth out of 1,022 funds, based on total return, in the
Lipper Growth category,*** for the same time period. As always, we continued to
focus exclusively on high-quality, large-cap companies which we believe have
superior growth potential. We maintain a concentrated portfolio and we don't
concern ourselves with issues of market timing and valuation. The Fund includes
25 names, and, as always, we let the winners run and eliminated the losers. As
a result, the Fund's largest holdings are generally its best performing as
well. In addition, a structured overlay, representing 30% of Fund assets,
consists of a complimentary basket of stocks selected from the Russell 1000
Growth Index, which includes growth-oriented issuers selected from among the
1000 largest U.S. issuers. The overlay is designed to increase diversification
and reduce volatility without materially inhibiting return potential.
Throughout the fiscal year, we focused on several secular trends and areas
where we have been able to identify the most rapid growth potential: technology
(PC and Internet), globally dominant financial intermediaries, and globally
dominant brand names. Among the Fund's strongest performers for the year were
America Online and Charles Schwab. Microsoft, Dell and EMC were notably strong
as well. Among the Fund's weaker performers was PeopleSoft, which was
eliminated from the portfolio in the fourth fiscal quarter. The structured
overlay continued to do well and helped dampen the overall volatility of the
Fund.
<TABLE>
<CAPTION>
S&P 500
Composite Stock Price Index** Optimum Growth Fund Russell 1000 Growth Index****
----------------------------- ------------------- -----------------------------
<S> <C> <C> <C>
6/1/96 $10,000 $10,000 $10,000
9/30/96 $10,350 $10,004 $10,374
3/31/97 $11,510 $10,223 $11,059
9/30/97 $14,530 $13,423 $14,139
3/31/98 $17,030 $16,444 $16,528
9/30/98 $15,845 $16,851 $15,701
3/31/99 $20,175 $27,749 $21,166
</TABLE>
<PAGE>
-------------------------------------------------
| Optimum Growth Fund+ |
|-------------------------------------------------|
| Average Annual Total Return |
| Ended on 3/31/99* |
|-------------------------------------------------|
| 1 year | Since Inception (6/1/96) |
|---------------|---------------------------------|
| 68.74% | 43.32% |
-------------------------------------------------
Past performance is not predictive of future performance. Investment returns
and principal values will vary and shares may be worth more or less at
redemption than their original cost.
The above illustration compares a $10,000 investment made in Optimum
Growth Fund and a broad-based index since 6/1/96 (inception date). All
dividends and capital gain distributions are reinvested. The Fund's performance
takes into account fees and expenses. The index does not take into account
charges, fees and other expenses. Beginning with this report, we are now
comparing the Fund's performance to the Russell 1000 Growth Index rather than
the Standard & Poor's 500 Composite Stock Price Index as this index better
represents the Fund's investment universe. Further information relating to Fund
performance is contained in the Financial Highlights section of the Prospectus
and elsewhere in this report.
- ------------
* Total return represents the change during the period in a hypothetical
account with dividends reinvested.
** Source: Standard & Poor's Corporation--Reflects the reinvestment of income
dividends and, where applicable, capital gain distributions. The Standard
& Poor's 500 Composite Stock Price Index is a widely accepted unmanaged
index of U.S. stock market performance.
*** Source: Lipper Analytical Services, Inc.--Lipper is an independent mutual
fund performance monitor.
**** Source: The Russell Company--The Russell 1000 Growth is an unmanaged index
and is composed of the 1,000 companies with higher price-to-book ratios
and higher forecasted growth values in the Russell 3000 Index. The Russell
3000 Index is composed of 3,000 of the largest U.S. Companies by market
capitalization. The Index includes dividends reinvested.
+ The Fund is currently waiving certain fees. Had the Fund not waived fees,
returns would have been lower. This voluntary waiver may be modified or
terminated at any time.
<PAGE>
ADVISER'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST VALUE EQUITY FUND
- --------------------------------------------------------------------------------
For the twelve months ended March 31, 1999, the Fund realized a total return of
4.80%*, versus 5.04%*** for The Russell 1000 Value Index. For the fiscal year,
the Fund's best performers were concentrated in the technology and
telecommunications sectors. As for portfolio structure and strategy, we made no
significant changes. We remained broadly diversified, though with overweight
positions in aerospace, financials, and technology, and underweight positions
in utilities, health care, and the big consumer names. Throughout the year, we
gradually diversified away from the high-flying large-cap stocks, adding
somewhat more defensive and, we feel, higher-quality larger-capitalization
names. As of fiscal year end, roughly 75% of the Fund's holdings boasted market
capitalizations in excess of $5 billion, up from 65% a year ago. We continue to
believe firmly in the Fund's strategy.
<TABLE>
<CAPTION>
S&P 500
Composite Stock Price Index** Value Equity Fund Russell 1000 Growth Index***
----------------------------- ----------------- ----------------------------
<S> <C> <C> <C>
6/1/96 $10,000 $10,000 $10,000
9/30/96 $10,350 $10,261 $10,299
3/31/97 $11,510 $11,391 $11,617
9/30/97 $14,530 $15,397 $14,657
3/31/98 $17,030 $17,030 $17,096
9/30/98 $15,845 $14,364 $15,183
3/31/99 $20,175 $18,105 $17,958
</TABLE>
-------------------------------------------------
| Value Equity Fund+ |
|-------------------------------------------------|
| Average Annual Total Return |
| Ended on 3/31/99* |
|-------------------------------------------------|
| 1 year | Since Inception (6/1/96) |
|---------------|---------------------------------|
| 4.80% | 23.29% |
-------------------------------------------------
Past performance is not predictive of future performance. Investment returns
and principal values will vary and shares may be worth more or less at
redemption than their original cost.
The above illustration compares a $10,000 investment made in Value Equity
Fund and a broad-based index since 6/1/96 (inception date). All dividends and
capital gain distributions are reinvested. The Fund's performance takes into
account fees and expenses. The index does not take into account charges, fees
and other expenses. Beginning with this report, we are now comparing the Fund's
performance to the Russell 1000 Value Index rather than the Standard & Poor's
500 Composite Stock Price Index as this index better represents the Fund's
investment universe. Further information relating to Fund performance is
contained in the Financial Highlights section of the Prospectus and elsewhere
in this report.
- ------------
* Total return represents the change during the period in a hypothetical
account with dividends reinvested.
** Source: Standard & Poor's Corporation--Reflects the reinvestment of income
dividends and, where applicable, capital gain distributions. The Standard &
Poor's 500 Composite Stock Price Index is a widely accepted unmanaged index
of U.S. stock market performance.
*** Source: The Russell Company -- The Russell 1000 Value Index is an unmanaged
index and is composed of the 1,000 companies with lower price-to-book
ratios and lower forecasted growth values in the Russell 3000 Index. The
Russell 3000 Index is composed of 3,000 of the largest U.S. Companies by
market capitalization. The Index includes dividends reinvested.
+ The Fund is currently waiving certain fees. Had the Fund not waived fees,
returns would have been lower. This voluntary waiver may be modified or
terminated at any time.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
Equity Fund
<TABLE>
<CAPTION>
Shares Value
- ------------------------ -------------
<S> <C> <C>
COMMON STOCKS -- 99.82%
TECHNOLOGY -- 22.66%
74,738 +Cisco Systems, Inc. ................... $ 8,188,482
17,041 +EMC Corp. ............................. 2,176,988
39,361 Honeywell, Inc. ....................... 2,984,056
52,865 Intel Corp. ........................... 6,284,327
15,103 International Business Machines
Corp. ................................ 2,677,007
16,120 Lucent Technologies, Inc. ............. 1,736,930
140,506 +Microsoft Corp. ....................... 12,584,069
6,564 Nokia Oyj, Class A ADR ................. 1,022,343
16,615 +Sun Microsystems, Inc. ................ 2,076,875
10,869 Texas Instruments, Inc. ............... 1,078,748
-----------
40,809,825
-----------
FINANCIAL -- 17.64%
44,932 American International Group,
Inc. ................................. 5,419,922
47,348 Associates First Capital Corp.,
Class A ............................... 2,130,660
69,323 BankBoston Corp. ...................... 3,002,552
5,346 Capital One Financial Corp. ........... 807,246
13,710 Charles Schwab Corp. .................. 1,317,874
53,551 Citigroup, Inc. ....................... 3,420,570
43,773 Firstar Corp. ......................... 3,917,684
27,736 Household International, Inc. ......... 1,265,455
53,418 Mellon Bank Corp. ..................... 3,759,292
34,489 Morgan Stanley Dean Witter &
Co. .................................. 3,446,744
93,561 Wells Fargo Co. ....................... 3,280,483
-----------
31,768,482
-----------
CONSUMER STAPLES -- 17.24%
68,483 Bestfoods .............................. 3,218,701
58,385 Coca-Cola Co. ......................... 3,583,379
86,693 Gillette Co. .......................... 5,152,815
90,868 Mattel, Inc. .......................... 2,260,341
83,738 Pioneer Hi-Bred International,
Inc. ................................. 3,150,642
55,712 Procter & Gamble Co. .................. 5,456,294
115,731 Time Warner, Inc. ..................... 8,224,134
-----------
31,046,306
-----------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Shares Value
- ------------------------ ------------
<S> <C> <C>
COMMON STOCKS -- (continued)
HEALTH CARE -- 12.71%
53,084 Bristol-Myers Squibb Co. ............... $ 3,413,965
21,302 Medtronic, Inc. ....................... 1,528,418
43,374 Merck & Co., Inc. ..................... 3,478,053
61,421 Pfizer, Inc. .......................... 8,522,164
107,449 Schering-Plough Corp. ................. 5,943,273
-----------
22,885,873
-----------
CONSUMER CYCLICAL -- 9.43%
104,464 +CBS Corp. ............................. 4,276,495
500 +Cheap Tickets, Inc. ................... 16,813
19,522 Ford Motor Co. ........................ 1,107,874
40,647 Home Depot, Inc. ...................... 2,530,276
80,164 McDonald's Corp. ...................... 3,632,431
500 +Multex.com, Inc. ...................... 31,187
2,500 +Priceline.com, Inc. ................... 207,031
3,000 +Prodigy Communications Corp. .......... 114,750
114,153 Stewart Enterprises, Inc., Class A...... 1,826,448
32,858 Wal-Mart Stores, Inc. ................. 3,029,097
6,000 +Ziff-Davis, Inc. -- ZDNet .............. 216,000
-----------
16,988,402
-----------
COMMUNICATION
SERVICES -- 7.87%
18,372 America Online, Inc. .................. 2,682,312
35,122 AT&T Corp. ............................ 2,803,175
81,804 +MCI WorldCom, Inc. .................... 7,239,654
30,850 SBC Communications, Inc. .............. 1,453,806
-----------
14,178,947
-----------
ENERGY -- 6.43%
27,894 BP Amoco plc ADR ....................... 2,815,550
38,678 Burlington Resources, Inc. ............ 1,544,703
42,041 Mobil Corp. ........................... 3,699,608
67,842 Royal Dutch Petroleum Co. ............. 3,527,784
-----------
11,587,645
-----------
CAPITAL GOODS -- 5.84%
62,627 General Electric Co. .................. 6,928,112
57,949 Illinois Tool Works, Inc. ............. 3,585,594
-----------
10,513,706
-----------
TOTAL COMMON STOCKS
(Cost $112,854,411).................... 179,779,186
-----------
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
Equity Fund -- (continued)
Principal
Amount Value
- --------- ---------
DEMAND NOTES -- 0.39%
$ 400,000 Associates Corp. of North America
Master Notes .................. $400,000
309,000 General Electric Co.
Promissory Notes .............. 309,000
--------
TOTAL DEMAND NOTES
(Cost $709,000)................ 709,000
--------
TOTAL INVESTMENTS
(Cost $113,563,411) ......... 100.21% $180,488,186
OTHER ASSETS AND
LIABILITIES (NET) .......... ( 0.21) (378,568)
------ ------------
NET ASSETS ................... 100.00% $180,109,618
====== ============
- -------------------------
+ Non-income producing security
ADR -- American Depositary Receipt
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
Income Fund
<TABLE>
<CAPTION>
Principal Coupon Maturity
Amount Rate Date Value
- ------------------ ------------ ------------- -------------
<S> <C> <C> <C> <C>
U.S. GOVERNMENT & AGENCY
OBLIGATIONS -- 53.37%
Federal Home Loan
Mortgage Corporation
$ 6,276 Pool #220001 ......... 10.75% 7/01/00 $ 6,467
Federal National
Mortgage Association
4,800,000 Benchmark Notes ...... 5.13 2/13/04 4,711,992
959,073 Pool #190748 ......... 5.50 4/01/01 945,811
4,187,849 Pool #251502 ......... 6.50 2/01/13 4,225,146
1,396,336 Pool #381015 ......... 5.96 12/01/08 1,379,867
1,455,993 Pool #381031 ......... 5.91 12/01/08 1,442,394
2,678,761 Pool #398283 ......... 6.00 3/01/28 2,603,525
1,527,912 Pool #420814 ......... 6.00 7/01/28 1,484,999
1,263,787 Pool #439102 ......... 6.00 9/01/28 1,228,293
Government National
Mortgage Association
839,530 Pool #471660 ......... 7.50 3/15/28 864,060
1,686,943 Pool #472028 ......... 6.50 5/15/28 1,679,102
1,752,054 Pool #475847 ......... 6.50 6/15/28 1,743,910
2,374,197 Pool #80205 .......... 5.00 6/20/28 2,377,175
3,853,003 Pool #2687 ........... 6.00 12/20/28 3,724,320
6,508,000 U.S. Treasury
Bonds ............... 7.25 5/15/16 7,467,930
----------
TOTAL U.S. GOVERNMENT &
AGENCY OBLIGATIONS
(Cost $36,185,852) .................................. 35,884,991
----------
ASSET BACKED SECURITIES -- 30.98%
1,655,051 Bear Stearns
Commercial
Mortgage
Securities, Series
98-C1, Class A1 ....... 6.34 10/16/07 1,673,769
2,340,000 Capital Auto
Receivables Trust,
Series 99-1, Class
A2 .................... 5.58 6/15/02 2,346,294
2,600,000 Caterpillar
Financial Asset
Trust, Series 98-A,
Class A3 .............. 5.85 4/25/03 2,605,278
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Principal Coupon Maturity
Amount Rate Date Value
- ------------------ ------------- ---------------- ----------------
<S> <C> <C> <C> <C>
ASSET BACKED SECURITIES -- (continued)
$1,865,000 Citibank Credit
Card Master Trust
I, Series 98-9,
Class A ............... 5.30% 1/09/06 $1,818,394
2,000,000 Commercial
Mortgage Asset
Trust, Series
99-C1, Class A3 ....... 6.64 9/17/10 2,017,500
1,265,000 Daimler-Benz
Vehicle Trust,
Series 98-A,
Class A4 .............. 5.22 12/22/03 1,242,281
2,340,119 First Union,
Lehman Brothers,
Bank of America,
Series 98-C2,
Class A1 .............. 6.28 6/18/07 2,360,783
2,000,000 First USA Credit
Card Master Trust,
Series 98-9,
Class A ............... 5.28 9/18/06 1,963,660
815,805 Mortgage Capital
Funding, Inc.,
Series 98-MC1,
Class A1 .............. 6.42 6/18/07 827,594
1,500,000 Mortgage Capital
Funding, Inc.,
Series 97-MC2,
Class A2 .............. 6.66 9/20/07 1,526,940
1,115,000 Nationslink
Funding Corp.,
Series 98-2,
Class A2 .............. 6.48 7/20/08 1,129,172
1,301,375 Nomura Asset
Securities Corp.,
Series 98-D6,
Class A1A ............. 6.28 3/17/28 1,317,980
----------
TOTAL ASSET BACKED SECURITIES
(Cost $20,901,071) ................................. 20,829,645
----------
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
Income Fund -- (continued)
Principal Coupon Maturity
Amount Rate Date Value
- ------------ ---------- ---------- -------------
CORPORATE BONDS -- 7.86%
$ 975,000 Ford Motor Co. .......... 7.70% 5/15/97 $1,054,969
1,455,000 General Motors
Corp. ................. 6.25 5/01/05 1,456,389
1,230,000 IBM Corp. .............. 7.13 12/01/96 1,274,253
1,550,000 Merrill Lynch &
Co. .................... 6.00 2/17/09 1,500,216
----------
TOTAL CORPORATE BONDS
(Cost $5,423,373)............................. 5,285,827
----------
Shares Value
- ----------- ---------------
SHORT-TERM INVESTMENTS -- 8.76%
2,951,557 Dreyfus Government Cash
Management Fund .......................... $ 2,951,557
2,942,199 Fidelity U.S. Treasury II Fund ............ 2,942,199
------------
TOTAL SHORT-TERM
INVESTMENTS
(Cost $5,893,756) ........................ 5,893,756
------------
TOTAL INVESTMENTS
(Cost $68,404,052).......... 100.97% $ 67,894,219
OTHER ASSETS AND
LIABILITIES (NET). . . . . . . . . . ( 0.97) (654,516)
------ ------------
NET ASSETS . . . . . . . . . . . . . . . . 100.00% $ 67,239,703
====== ============
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
Total Return Bond Fund
<TABLE>
<CAPTION>
Principal Coupon Maturity
Amount Rate Date Value
- -------------- ------------- ---------- --------------
<S> <C> <C> <C> <C>
U.S. GOVERNMENT & AGENCY
OBLIGATIONS -- 47.17%
Federal National
Mortgage Association
$46,595,000 Benchmark Notes........ 5.13% 2/13/04 $45,740,681
5,175,436 Pool #440167 .......... 6.00 9/01/28 5,030,079
6,447,545 Pool #452975 .......... 6.00 12/01/28 6,266,460
Government National
Mortgage Association
33,635 Pool #356873 .......... 6.50 5/15/23 33,479
4,004,953 Pool #80185 ........... 5.00 4/20/28 4,009,976
2,364,739 Pool #80205 ........... 5.00 6/20/28 2,367,704
5,044,294 Pool #2687 ............ 6.00 12/20/28 4,875,825
43,889,000 U.S. Treasury
Bonds ................ 7.25 5/15/16 50,362,627
-----------
TOTAL U.S. GOVERNMENT &
AGENCY OBLIGATIONS
(Cost $119,476,463).................................. 118,686,831
-----------
ASSET BACKED SECURITIES -- 26.99%
6,580,000 +AESOP Funding
II, Series 97-1,
Class A2 ............... 6.40 10/20/03 6,673,962
4,470,540 Bear Stearns
Commercial
Mortgage
Securities, Series
98-C1, Class A1 ........ 6.34 10/16/07 4,521,102
8,960,000 Capital Auto
Receivables Asset
Trust, Series 99-1,
Class A3 ............... 5.68 8/15/04 8,981,235
7,790,000 Commercial
Mortgage Asset
Trust, Series
99-C1, Class A3 ........ 6.64 9/17/10 7,858,163
3,980,000 Daimler-Benz
Vehicle Trust,
Series 98-A,
Class A4 ............... 5.22 12/22/03 3,908,519
4,330,896 First Union,
Lehman Brothers,
Bank of America,
Series 98-C2,
Class A1 ............... 6.28 6/18/07 4,369,138
4,560,000 First Union,
Lehman Brothers,
Bank of America,
Series 98-C2,
Class A2 ............... 6.56 11/18/08 4,637,976
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Principal Coupon Maturity
Amount Rate Date Value
- -------------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
ASSET BACKED SECURITIES -- (continued)
$ 5,500,000 First USA Credit
Card Master Trust,
Series 98-9, Class A 5.28% 9/18/06 $ 5,400,065
3,855,000 MBNA Master
Credit Card Trust,
Series 98-J, Class A 5.25 2/15/06 3,799,334
4,258,222 Mortgage Capital
Funding, Inc.,
Series 98-MC1,
Class A1 ............... 6.42 6/18/07 4,319,753
5,526,473 Nationslink
Funding Corp.,
Series 98-2,
Class A1 ............... 6.00 11/20/07 5,504,809
4,368,901 Nomura Asset
Securities Corp.,
Series 98-D6,
Class A1A .............. 6.28 3/17/28 4,424,648
3,525,000 Peco Energy
Transition Trust,
Series 99-A,
Class A4 ............... 5.80 3/01/07 3,523,308
-----------
TOTAL ASSET BACKED
SECURITIES
(Cost $68,073,374)................................... 67,922,012
-----------
CORPORATE BONDS -- 19.22%
6,485,000 Bank One Corp.,
Series A ............. 6.00 2/17/09 6,306,838
4,915,000 Emerson Electric ...... 5.85 3/15/09 4,883,672
9,000,000 Ford Motor
Credit Co. ........... 5.75 2/23/04 8,924,022
4,575,000 IBM Corp. ............. 7.13 12/01/96 4,739,599
3,895,000 McDonald's Corp........ 5.90 5/11/01 3,929,743
4,160,000 Merrill Lynch &
Co. .................. 6.00 2/17/09 4,026,385
3,950,000 Morgan Stanley
Dean Witter &
Co. .................. 6.38 8/01/02 4,006,864
3,895,000 New Jersey
Economic
Development
Authority,
Revenue Bonds,
Series A ............. 7.43 2/15/29 4,265,426
7,190,000 Star Bank N.A. ........ 6.38 3/01/04 7,281,263
-----------
TOTAL CORPORATE BONDS
(Cost $48,951,027)................................... 48,363,812
-----------
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
Total Return Bond Fund -- (continued)
Principal Coupon Maturity
Amount Rate Date Value
- ------------- -------- ---------- --------------
SHORT-TERM INVESTMENTS -- 6.16%
$8,000,000 Federal Home Loan
Bank Discount
Corp. 4.77%++ 4/08/99 $7,992,580
<TABLE>
<CAPTION>
Shares
- ---------------------
<S> <C> <C> <C> <C>
3,714,818 Dreyfus Government Cash
Management Fund ................................ 3,714,818
3,788,596 Fidelity U.S. Treasury II
Fund ........................................... 3,788,596
---------
TOTAL SHORT-TERM
INVESTMENTS
(Cost $15,495,994).............................. 15,495,994
----------
TOTAL INVESTMENTS
(Cost $251,996,858).......................................... 99.54% $250,468,649
OTHER ASSETS AND
LIABILITIES (NET) ........................................... 0.46 1,145,238
------ ------------
NET ASSETS .................................................... 100.00% $251,613,887
====== ============
</TABLE>
- -------------------------
+ 144A Security - certain conditions for public sale may exist.
++ Discount Rate
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
<TABLE>
<CAPTION>
Balanced Fund
Shares Value
- -------------- -----------
<S> <C> <C>
COMMON STOCKS -- 60.27%
TECHNOLOGY -- 13.00%
10,000 Avnet, Inc. ........................... $ 366,250
20,000 Columbia/HCA Healthcare Corp. 378,750
25,000 Comdisco, Inc. ........................ 446,875
4,500 Intel Corp. ........................... 534,937
11,000 Lockheed Martin Corp. ................. 414,563
21,000 +Marshall Industries .................... 283,500
10,000 Rockwell International Corp. .......... 424,375
21,000 Tektronix, Inc. ....................... 530,250
6,000 Telebras ADR ........................... 483,750
8,000 Xerox Corp. ........................... 427,000
----------
4,290,250
----------
CONSUMER CYCLICAL -- 10.50%
41,000 +Cabletron Systems, Inc. ............... 335,688
40,000 Clayton Homes, Inc. ................... 442,500
6,000 Eaton Corp. ........................... 429,000
8,000 Ford Motor Co. ........................ 454,000
5,500 General Motors Corp. .................. 477,812
8,000 Goodyear Tire & Rubber Co. ............ 398,500
18,000 +LSI Logic Corp. ....................... 561,375
13,000 Sherwin-Williams Co. .................. 365,625
----------
3,464,500
----------
FINANCIAL -- 8.99%
10,000 Allstate Corp. ........................ 370,625
6,500 Fannie Mae ............................. 450,125
15,000 Mack-Cali Realty Corp. ................ 440,625
8,000 PNC Bank Corp. ........................ 444,500
11,000 Safeco Corp. .......................... 444,812
10,000 SLM Holding Corp. ..................... 417,500
19,000 Washington Federal, Inc. .............. 399,000
----------
2,967,187
----------
ENERGY -- 6.70%
8,000 Atlantic Richfield Co. ................ 584,000
30,000 Enron Oil & Gas Co. ................... 498,750
35,000 Santa Fe International Corp. .......... 654,062
15,000 YPF S.A. ADR ........................... 473,438
----------
2,210,250
----------
CAPITAL GOODS -- 6.68%
11,000 Caterpillar, Inc. ..................... 505,313
10,000 +Gulfstream Aerospace Corp. ............ 433,750
20,000 Halliburton Co. ....................... 770,000
6,000 Koninklijke (Royal) Philips
Electronics N.V. ...................... 494,625
----------
2,203,688
----------
RAW/INTERMEDIATE
MATERIALS -- 4.20%
20,000 Millenium Chemicals Inc. .............. 397,500
9,000 Weyerhaeuser Co. ...................... 499,500
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Shares Value
- -------------- ----------
<S> <C> <C>
COMMON STOCKS -- (continued)
RAW/INTERMEDIATE
MATERIALS -- (continued)
13,000 Willamette Industries, Inc. ............ $ 490,750
----------
1,387,750
----------
CONSUMER STAPLES -- 3.73%
14,000 American Greetings Corp., Class A 355,250
16,000 Dole Food Co., Inc. ................... 476,000
15,000 Mallinckrodt, Inc. .................... 399,375
----------
1,230,625
----------
TRANSPORTATION -- 3.71%
7,000 +AMR Corp. ............................. 409,938
7,000 Delta Air Lines, Inc. ................. 486,500
10,000 GATX Corp. ............................ 329,375
----------
1,225,813
----------
MANUFACTURING -- 2.76%
8,000 PPG Industries, Inc. .................. 410,000
18,000 Tenneco, Inc. ......................... 502,875
----------
912,875
----------
TOTAL COMMON STOCKS
(Cost $16,146,197) .................... 19,892,938
----------
Principal
Amount
- -----------
CORPORATE BONDS -- 17.63%
FINANCIAL -- 9.79%
$ 500,000 American General Corp.
7.75%, 4/01/05 ......................... 534,219
600,000 Associates Corp. of North America
5.75%, 11/01/03 ........................ 594,418
500,000 Conseco, Inc.
6.80%, 6/15/05 ......................... 483,044
810,000 Safeco Corp.
7.875%, 4/01/05 ........................ 849,547
750,000 Transamerica Corp.
6.75%, 11/15/06 ........................ 768,817
----------
3,230,045
----------
RAW/INTERMEDIATE
MATERIALS -- 3.86%
750,000 Phelps Dodge Corp.
7.75%, 1/01/02 ......................... 778,579
500,000 Willamette Industries, Inc.
7.00%, 2/01/18 ......................... 497,096
----------
1,275,675
----------
UTILITIES -- 2.41%
750,000 Citizens Utilities Co.
7.45%, 1/15/04 ......................... 794,002
----------
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
Balanced Fund -- (continued)
Principal
Amount Value
- -------------- ---------
CORPORATE BONDS -- (continued)
CONSUMER STAPLES -- 1.57%
$ 500,000 Tenneco, Inc.
7.50%, 4/15/07 ................. $ 519,308
---------
TOTAL CORPORATE BONDS
(Cost $5,819,288)............... 5,819,030
---------
U.S. GOVERNMENT & AGENCY
OBLIGATIONS -- 19.62%
Federal Home Loan Mortgage
Corp.
650,000 6.40%, 12/13/06 ................. 671,402
Federal National Mortgage
Association
300,000 5.45%, 10/10/03 ................. 298,196
750,000 7.50%, 4/16/07 .................. 785,469
U.S. Treasury Notes
750,000 7.50%, 10/31/99 ................. 761,485
500,000 7.75%, 11/30/99 ................. 509,531
300,000 6.375%, 9/30/01 ................. 308,906
775,000 6.125%, 12/31/01 ................ 794,618
750,000 6.625%, 3/31/02 ................. 780,235
1,000,000 6.25%, 8/31/02 .................. 1,032,813
Principal
Amount Value
- -------------- ---------
U.S. GOVERNMENT & AGENCY
OBLIGATIONS -- (continued)
$ 500,000 6.50%, 10/15/06 ................. $ 532,812
---------
TOTAL U.S. GOVERNMENT &
AGENCY OBLIGATIONS
(Cost $6,423,873)................ 6,475,467
---------
DEMAND NOTES -- 2.65%
400,000 Associates Corp. of North America
Master Notes ................... 400,000
473,000 General Electric Co.
Promissory Notes ............... 473,000
---------
TOTAL DEMAND NOTES
(Cost $873,000)................. 873,000
---------
TOTAL INVESTMENTS
(Cost $29,262,358) ......... 100.17% $33,060,435
OTHER ASSETS AND
LIABILITIES (NET) .......... ( 0.17) (55,790)
------ -----------
NET ASSETS ................... 100.00% $33,004,645
====== ===========
- -------------------------
+ Non-income producing security
ADR--American Depositary Receipt
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
International Equity Fund
Shares Value
- ------------- -------------
COMMON STOCKS -- 99.96%
JAPAN -- 15.37%
148 DDI Corp. .......................... $ 700,118
5,300 Don Quijote Co., Ltd ................ 1,181,956
75,500 Meitec Corp. ....................... 2,200,329
10,300 NIDEC Corp. ........................ 1,270,316
10,600 Nintendo Co., Ltd. ................. 915,121
369 NTT Data Corp. ..................... 2,855,246
20,900 +Nu Skin Enterprises, Inc., Class A 478,087
5,000 Rohm Co. ........................... 597,652
11,200 Sony Corp. ......................... 1,035,986
28,000 Taisho Pharmaceutical Co., Ltd....... 875,148
-----------
12,109,959
-----------
FRANCE -- 13.68%
4,000 Air Liquide ......................... 596,821
18,140 Axa ................................. 2,408,468
2,035 Carrefour S.A. ..................... 1,570,970
44,250 Dassault Systemes S.A. ............. 1,641,015
13,500 Elf Aquitaine S.A. ................. 1,836,198
790 L'OREAL ............................. 500,530
4,100 Total S.A., Class B ................. 505,795
7,000 Vivendi ............................. 1,724,835
-----------
10,784,632
-----------
UNITED KINGDOM -- 11.94%
228,900 Airtours plc ........................ 1,663,517
363,300 BTR Siebe plc ....................... 1,603,226
10,700 Glaxo Wellcome plc .................. 358,222
10,000 Glaxo Wellcome plc ADR .............. 669,375
56,000 Granada Group plc ................... 1,135,013
30,000 Pearson plc ......................... 683,624
35,000 Railtrack Group plc ................. 803,779
105,900 Serco Group plc ..................... 2,496,996
-----------
9,413,752
-----------
GERMANY -- 8.69%
780 +GEA AG .............................. 17,710
22,940 +Mannesmann AG ....................... 2,849,828
27,010 Metro AG ............................ 1,717,146
5,270 SAP AG .............................. 1,518,494
11,300 Siemens AG .......................... 742,826
-----------
6,846,004
-----------
ITALY -- 8.37%
101,300 Autogrill S.p.A. ................... 1,002,157
147,800 Edison S.p.A. ...................... 1,363,103
163,000 Telecom Italia S.p.A. .............. 1,734,155
<PAGE>
Shares Value
- ----------- -----------
COMMON STOCKS -- (continued)
ITALY -- (continued)
257,080 Telecom Italia Mobile S.p.A. ....... $ 995,077
278,400 Unicredito Italiano S.p.A. ......... 1,505,027
-----------
6,599,519
-----------
NETHERLANDS -- 7.16%
36,700 ING Groep N.V. ..................... 2,025,662
15,000 Royal Dutch Petroleum Co. .......... 780,000
15,400 +STMicroelectronics N.V. ............ 1,531,009
7,200 Wolters Kluwer N.V. ................ 1,307,817
-----------
5,644,488
-----------
SWITZERLAND -- 6.06%
29 Lindt & Spruengli AG ................ 825,036
563 Novartis AG (Registered) ............ 915,643
248 Roche Holding AG .................... 3,032,175
-----------
4,772,854
-----------
SINGAPORE -- 4.87%
1,077,000 Datacraft Asia, Ltd. ............... 2,520,180
97,300 Development Bank of Singapore
Ltd. ............................... 738,274
211,000 Natsteel Electronics Ltd. .......... 576,843
-----------
3,835,297
-----------
AUSTRALIA -- 3.60%
82,000 Brambles Industries Ltd. ........... 2,084,926
28,900 Lend Lease Corp., Ltd. ............. 368,294
550,000 +LibertyOne Ltd. .................... 383,752
-----------
2,836,972
-----------
CANADA -- 3.18%
54,800 Bombardier Inc., Class B ............ 721,914
45,500 +CGI Group, Inc. .................... 988,934
12,800 Northern Telecom Ltd. .............. 798,513
-----------
2,509,361
-----------
SWEDEN -- 2.99%
28,300 Celsius AB, Series B ................ 465,762
77,700 Telefonaktiebolaget LM Ericsson,
Class B ............................ 1,894,498
-----------
2,360,260
-----------
IRELAND -- 2.89%
149,200 Irish Permanent plc ................. 2,274,538
-----------
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
International Equity Fund -- (continued)
Shares Value
- ------------- -------------
HONG KONG -- 2.86%
327,400 Dairy Farm International
Holdings Ltd. ..................... $ 379,784
1,592,110 +Hengan International Group Co.,
Ltd. .............................. 616,380
255,000 Johnson Electric Holdings Ltd. ...... 719,029
254,000 Li & Fung, Ltd. .................... 537,566
-----------
2,252,759
-----------
THAILAND -- 2.44%
517,400 +Banpu Public Co., Ltd.
(Registered) ....................... 623,830
244,900 BEC World Public Co., Ltd.
(Foreign) .......................... 1,187,631
80,500 Dhipaya Insurance Public Co.,
Ltd. .............................. 89,552
7,300 +Sermsuk Public Co., Ltd.
(Foreign) .......................... 19,840
-----------
1,920,853
-----------
SPAIN -- 2.09%
110,280 Banco Bilbao Vizcaya S.A.
(Registered) ....................... 1,645,436
-----------
PORTUGAL -- 1.62%
42,130 Banco Comercial Portugues S.A. . 1,275,424
-----------
ISRAEL -- 0.98%
12,900 +Gilat Satellite Networks Ltd. ...... 769,163
-----------
CHILE -- 0.60%
16,000 Vina Concha Y Toro S.A. ADR ......... 470,000
-----------
ARGENTINA -- 0.43%
10,800 YPF S.A. ADR ........................ 340,875
-----------
HUNGARY -- 0.14%
3,300 ++Gedeon Richter ...................... 108,488
-----------
TOTAL COMMON STOCKS
(Cost $77,158,821) .................. 78,770,634
-----------
<PAGE>
No. of
Warrants Value
- ---------- ---------
WARRANTS -- 0.87%
PHILIPPINES -- 0.86%
1,345,200 +QueenBee Restaurants --
Jollibee Foods Corp.,
expiring 03/24/03 at $19.25........... $679,570
--------
JAPAN -- 0.01%
13,000 +Atlantis Japan Growth Fund Ltd.,
expiring 04/30/01 at $10.00 .......... 4,355
--------
TOTAL WARRANTS
(Cost $674,835) ...................... 683,925
--------
Principal
Amount
- -----------
CONVERTIBLE BONDS -- 0.10%
PORTUGAL -- 0.10%
$ 700 Banco Comercial Portugues S.A.,
Series A (Preferred) 8.00%,
12/31/2049
(Cost $81,900)........................ 78,400
--------
TOTAL INVESTMENTS
(Cost $77,915,556)......... 100.93% $79,532,959
OTHER ASSETS AND
LIABILITIES (NET) ......... ( 0.93) (731,060)
------ -----------
NET ASSETS .................. 100.00% $78,801,899
====== ===========
- -------------------------
+ Non-income producing security
++ 144A Security -- certain conditions for public
sale may exist.
ADR -- American Depositary Receipt
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
International Equity Fund -- (continued)
At March 31, 1999, sector diversification of the Fund's investment
portfolio was as follows:
% of
Net Market
Sector Diversification Assets Value
- ------------------------------------ -------- ------------
Technology ......................... 20.37% $16,050,705
Consumer Cyclical .................. 19.43 15,313,594
Consumer Staples ................... 16.99 13,390,273
Financial .......................... 15.65 12,335,031
Utilities .......................... 7.43 5,850,397
Energy ............................. 6.12 4,825,972
Transportation ..................... 4.88 3,847,627
Raw/Intermediate Materials ......... 4.41 3,473,658
Capital Goods ...................... 3.61 2,842,477
Manufacturing ...................... 2.04 1,603,225
------ -----------
Total Investments ............. 100.93% $79,532,959
Other Assets and Liabilities (Net) ( 0.93) (731,060)
------ -----------
Net Assets .................... 100.00% $78,801,899
====== ===========
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
Optimum Growth Fund
Shares Value
- ------------- ----------
COMMON STOCKS -- 97.97%
TECHNOLOGY -- 29.51%
25,000 +BMC Software, Inc. ................. $ 926,563
50,000 +Cisco Systems, Inc. ................ 5,478,125
126,000 +Dell Computer Corp. ................ 5,150,250
54,000 +EMC Corp. .......................... 6,898,500
27,000 Intel Corp. ........................ 3,209,625
3,000 Lucent Technologies, Inc. .......... 323,250
52,000 +Microsoft Corp. .................... 4,657,250
8,000 Nokia Oyj, Class A ADR ............. 1,246,000
18,000 +Tellabs, Inc. ...................... 1,759,500
----------
29,649,063
----------
COMMUNICATION
SERVICES -- 15.84%
100,000 America Online, Inc. ............... 14,600,000
8,000 Ameritech Corp. .................... 463,000
14,000 GTE Corp. .......................... 847,000
----------
15,910,000
----------
FINANCIAL -- 15.55%
20,000 American International Group,
Inc. .............................. 2,412,500
64,500 Charles Schwab Corp. ............... 6,200,062
35,000 Citigroup, Inc. .................... 2,235,625
28,000 Fannie Mae ......................... 1,939,000
32,000 Merrill Lynch & Co., Inc. .......... 2,830,000
----------
15,617,187
----------
HEALTH CARE -- 13.75%
16,000 Abbott Laboratories ................ 749,000
13,300 American Home Products Corp. ....... 867,825
18,000 Bristol-Myers Squibb Co. ........... 1,157,625
7,000 Eli Lilly & Co. .................... 594,125
11,000 Johnson & Johnson .................. 1,030,562
41,855 Medtronic, Inc. .................... 3,003,096
24,600 Merck & Co., Inc. .................. 1,972,612
22,000 Pfizer, Inc. ....................... 3,052,500
20,000 +Quintiles Transnational Corp. ...... 750,000
11,400 Schering-Plough Corp. .............. 630,562
----------
13,807,907
----------
CONSUMER STAPLES -- 10.34%
13,500 Bestfoods .......................... 634,500
6,000 Brown-Forman Corp., Class B ........ 345,750
19,000 Coca-Cola Co. ...................... 1,166,125
25,200 General Mills, Inc. ................ 1,904,175
28,000 Gillette Co. ....................... 1,664,250
8,000 Hannaford Brothers Co. ............. 363,500
10,500 H.J. Heinz Co. ..................... 497,438
11,500 PepsiCo, Inc. ...................... 450,656
9,600 Procter & Gamble Co. ............... 940,200
<PAGE>
Shares Value
- ---------- ---------
COMMON STOCKS -- (continued)
CONSUMER STAPLES -- (continued)
12,000 Sara Lee Corp. ..................... $ 297,000
11,800 Time Warner, Inc. .................. 838,538
8,487 Tootsie Roll Industries, Inc. ...... 390,942
20,000 Walt Disney Co. .................... 622,500
3,000 Wrigley (WM.) Jr. Co. .............. 271,313
----------
10,386,887
----------
CONSUMER CYCLICAL -- 9.51%
25,000 +Clear Channel Communications,
Inc. .............................. 1,676,563
35,000 Harley-Davidson, Inc. .............. 2,012,500
48,000 Home Depot, Inc. ................... 2,988,000
13,200 McDonald's Corp. ................... 598,125
35,000 +Sylvan Learning Systems, Inc. ...... 953,750
11,000 Wal-Mart Stores, Inc. .............. 1,014,062
600 Washington Post Co., Class B ....... 312,900
----------
9,555,900
----------
CAPITAL GOODS -- 2.97%
27,000 General Electric Co. ............... 2,986,875
----------
UTILITIES -- 0.50%
12,000 Texas Utilities Co. ................ 500,250
----------
TOTAL COMMON STOCKS
(Cost $40,065,940) ................ 98,414,069
----------
Principal
Amount
- ----------
DEMAND NOTES -- 1.71%
$ 800,000 Associates Corp. of North America
Master Notes ...................... 800,000
919,000 General Electric Co.
Promissory Notes .................. 919,000
----------
TOTAL DEMAND NOTES
(Cost $1,719,000) ................. 1,719,000
----------
TOTAL INVESTMENTS
(Cost $41,784,940) ......... 99.68% $100,133,069
OTHER ASSETS AND
LIABILITIES (NET) .......... 0.32 325,785
------ ------------
NET ASSETS ................... 100.00% $100,458,854
====== ============
- -------------------------
+ Non-income producing security
ADR--American Depositary Receipt
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 1999
Value Equity Fund
<TABLE>
<CAPTION>
Shares Value
- ------------- ------------
<S> <C> <C>
COMMON STOCKS -- 98.36%
CONSUMER STAPLES -- 23.77%
22,000 Avon Products, Inc. .................... $ 1,035,375
21,000 Bestfoods ............................... 987,000
26,000 Bristol-Myers Squibb Co. ............... 1,672,125
22,000 Deluxe Corp. ........................... 640,750
19,000 Eastman Kodak Co. ...................... 1,213,625
29,625 Fort James Corp. ....................... 938,742
50,000 Pepsi Bottling Group, Inc. ............. 1,084,375
32,000 Philip Morris Companies, Inc. .......... 1,126,000
20,000 +Suiza Foods Corp. ...................... 673,750
-----------
9,371,742
-----------
TECHNOLOGY -- 21.16%
44,000 Alcatel SA ADR .......................... 1,003,750
30,000 +Bell & Howell Co. ...................... 879,375
15,000 Cordant Technologies, Inc. ............. 597,187
714 +Intermedia Communications, Inc. 19,010
9,000 International Business Machines
Corp. ................................. 1,595,250
17,000 Nokia Oyj, Class A ADR .................. 2,647,750
30,000 Xerox Corp. ............................ 1,601,250
-----------
8,343,572
-----------
FINANCIAL -- 19.48%
50,000 +Amerin Corp. ........................... 1,015,625
35,000 ARM Financial Group, Inc.,
Class A ................................ 522,813
17,000 Astoria Financial Corp. ................ 847,875
10,000 Bank One Corp. ......................... 550,625
20,000 Chase Manhattan Corp. .................. 1,626,250
12,000 Fannie Mae .............................. 831,000
14,000 People's Bank Bridgeport ................ 416,500
21,000 SLM Holding Corp. ...................... 876,750
16,344 XL Capital Ltd., Class A ................ 992,898
-----------
7,680,336
-----------
CONSUMER CYCLICAL -- 15.12%
22,880 +AT&T Corp. -- Liberty Media
Group, Class A ......................... 1,204,060
24,000 +CBS Corp. .............................. 982,500
25,000 Ford Motor Co. ......................... 1,418,750
22,000 +Unisys Corp. ........................... 609,125
100,000 +Varian, Inc. ........................... 943,750
19,700 +Young & Rubicam, Inc. .................. 802,775
-----------
5,960,960
-----------
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
Shares Value
- ------------- ------------
<S> <C> <C>
COMMON STOCKS -- (continued)
TRANSPORTATION -- 5.98%
11,000 +AMR Corp. .............................. $ 644,188
16,000 +General Motors Corp., Class H ........... 807,000
17,000 Union Pacific Corp. .................... 908,437
-----------
2,359,625
-----------
UTILITIES -- 5.53%
2,500 +Autobytel.com, Inc. .................... 104,375
40,000 Frontier Corp. ......................... 2,075,000
-----------
2,179,375
-----------
CAPITAL GOODS -- 5.41%
20,000 Kansas City Southern Industries,
Inc. .................................. 1,140,000
10,000 Texas Instruments, Inc. ................ 992,500
-----------
2,132,500
-----------
RAW/INTERMEDIATE
MATERIALS -- 1.91%
13,000 E.I. du Pont de Nemours and Co. 754,813
-----------
TOTAL COMMON STOCKS
(Cost $27,770,606) ..................... 38,782,923
-----------
Principal
Amount
- ----------
CONVERTIBLE BONDS -- 2.31%
TECHNOLOGY -- 2.31%
$ 25,000 Intermedia Communications, Inc.,
Series D (Preferred) 7.00%,
12/31/2049 (Cost $657,010) ............. 912,500
-----------
DEMAND NOTES -- 0.02%
7,000 General Electric Co. Promissory
Notes (Cost $7,000) .................... 7,000
-----------
</TABLE>
TOTAL INVESTMENTS
(Cost $28,434,616) ......... 100.69% $ 39,702,423
OTHER ASSETS AND
LIABILITIES (NET) .......... (0.69) (271,279)
------ ------------
NET ASSETS ................... 100.00% $ 39,431,144
====== ============
- -------------------------
+ Non-income producing security
ADR--American Depositary Receipt
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Assets and Liabilities
March 31, 1999
<TABLE>
<CAPTION>
Total Return
Equity Income Bond
Fund Fund Fund
----------------- -------------- ---------------
<S> <C> <C> <C>
Assets:
Investments, at cost -- see accompanying
Schedule of Investments ........................................... $ 113,563,411 $68,404,052 $251,996,858
============= =========== ============
Investments in securities, at value (Note 1a) ...................... $ 180,488,186 $67,894,219 $250,468,649
Cash ............................................................... 432 -- --
Dividends receivable ............................................... 160,401 -- --
Interest receivable ................................................ 3,056 549,797 2,392,867
Receivable for investment securities sold .......................... -- 225 --
Receivable for fund shares sold .................................... 136,241 -- 194,932
Deferred organization expenses (Note 1f) ........................... 566 -- 750
Other assets ....................................................... 2,673 1,337 4,150
------------- ----------- ------------
Total assets ...................................................... 180,791,555 68,445,578 253,061,348
Liabilities:
Payable for investments purchased .................................. 154,000 852,329 --
Dividends payable .................................................. -- 305,951 1,129,012
Payable for fund shares redeemed ................................... 416,486 -- 167,533
Investment advisory fees payable (Note 2a) ......................... 58,457 23,616 58,659
Administration fees payable (Note 2b) .............................. 22,429 9,097 33,993
Trustees' fees and expenses payable (Note 2f) ...................... 2,733 1,136 3,451
Accrued expenses and other liabilities ............................. 27,832 13,746 54,813
------------- ----------- ------------
Total liabilities ................................................. 681,937 1,205,875 1,447,461
------------- ----------- ------------
Net Assets .......................................................... $ 180,109,618 $67,239,703 $251,613,887
============= =========== ============
Net Assets Consist of:
Par value .......................................................... $ 120 $ 96 $ 344
Paid-in capital in excess of par value ............................. 104,439,766 67,665,697 253,648,761
Undistributed (distributions in excess of) net investment income . 110,555 (24,317) 16,857
Accumulated net realized gain (loss) on investments ................ 8,634,402 108,060 (523,866)
Unrealized appreciation (depreciation) of investments .............. 66,924,775 (509,833) (1,528,209)
------------- ----------- ------------
Net Assets .......................................................... $ 180,109,618 $67,239,703 $251,613,887
============= =========== ============
Institutional Shares outstanding (Unlimited number of $0.00001 par
value shares authorized for each Fund) ............................. 12,042,921 9,612,414 34,381,863
Net Asset Value Per Share (net assets / shares outstanding) ......... $ 14.96 $ 7.00 $ 7.32
============= =========== ============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Assets and Liabilities -- (continued)
March 31, 1999
<TABLE>
<CAPTION>
International Optimum Value
Balanced Equity Growth Equity
Fund Fund Fund Fund
--------------- -------------- ---------------- ---------------
<S> <C> <C> <C> <C>
Assets:
Investments, at cost -- see accompanying
Schedule of Investments ................................... $ 29,262,358 $ 77,915,556 $ 41,784,940 $ 28,434,616
============= ============ ============== =============
Investments in securities, at value (Note 1a) .............. $ 33,060,435 $ 79,532,959 $ 100,133,069 $ 39,702,423
Cash ....................................................... 210 -- 117 --
Dividends receivable ....................................... 40,424 104,218 56,858 60,998
Interest receivable ........................................ 262,538 1,641 3,571 2,231
Receivable for investment securities sold .................. 814,448 1,767,534 -- 1,605,827
Receivable for fund shares sold ............................ 402 930 400,200 26,803
Foreign withholding tax receivable ......................... -- 27,041 -- --
Deferred organization expenses (Note 1f) ................... 2,508 245 525 525
Other assets ............................................... 1,891 618 1,163 685
------------- ------------ -------------- -------------
Total assets .............................................. 34,182,856 81,435,186 100,595,503 41,399,492
Liabilities:
Payable for investments purchased .......................... 368,725 -- -- 1,215,600
Payable for fund shares redeemed ........................... 686,746 41,988 18,401 --
Investment advisory fees payable (Note 2a) ................. 28,936 26,158 40,480 15,415
Administration fees payable (Note 2b) ...................... 5,213 12,943 12,229 5,176
Trustees' fees and expenses payable (Note 2f) .............. 1,235 799 1,210 517
Due to custodian bank ...................................... -- 2,538,932 -- 720,280
Accrued expenses and other liabilities ..................... 87,356 12,467 64,329 11,360
------------- ------------ -------------- -------------
Total liabilities ......................................... 1,178,211 2,633,287 136,649 1,968,348
------------- ------------ -------------- -------------
Net Assets .................................................. $ 33,004,645 $ 78,801,899 $ 100,458,854 $ 39,431,144
============= ============ ============== =============
Net Assets Consist of:
Par value .................................................. $ 41 $ 93 $ 36 $ 26
Paid-in capital in excess of par value ..................... 25,095,269 77,665,435 39,495,981 27,635,702
Undistributed net investment income ........................ 553,154 28,435 -- 87,696
Accumulated net realized gain (loss) on investments ........ 3,558,104 (508,833) 2,614,708 439,024
Unrealized appreciation of investments and foreign
currency translations ..................................... 3,798,077 1,616,769 58,348,129 11,268,696
------------- ------------ -------------- -------------
Net Assets .................................................. $ 33,004,645 $ 78,801,899 $ 100,458,854 $ 39,431,144
============= ============ ============== =============
Net Assets:
Institutional Shares ....................................... $ 32,996,343 $ 78,801,899 $ 88,044,767 $ 39,306,600
Shares ..................................................... 8,302 -- 12,414,087 124,544
Shares outstanding (Unlimited number of $0.00001 par value
shares authorized for each Fund):
Institutional Shares ....................................... 4,093,503 9,328,980 3,195,972 2,563,525
Shares ..................................................... 1,025 -- 453,003 8,115
Net Asset Value Per Share (net assets / shares outstanding):
Institutional Shares ....................................... $ 8.06 $ 8.45 $ 27.55 $ 15.33
============= ============ ============== =============
Shares ..................................................... $ 8.10 -- $ 27.40 $ 15.35
============= ============ ============== =============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Operations
For the Year Ended March 31, 1999
<TABLE>
<CAPTION>
Total Return
Equity Income Bond
Fund Fund Fund
--------------- --------------- --------------
<S> <C> <C> <C>
Investment Income
Dividend income ...................... $ 1,381,462 $ -- $ --
Interest income ...................... 108,739 3,861,787 12,166,627
Less: Foreign taxes withheld ......... -- -- --
----------- ------------- ------------
Total Income ........................ 1,490,201 3,861,787 12,166,627
Expenses (Note 1g):
Investment advisory fees (Note 2a) 983,512 413,443 1,312,435
Administration fees (Note 2b) ........ 231,504 97,318 308,927
Custodian fees ....................... 54,472 15,902 50,239
Legal and audit fees ................. 32,638 13,917 40,657
Prospectus and shareholder
reports ............................. 8,829 4,305 10,892
Trustees' fees and expenses
(Note 2f) ........................... 10,734 4,920 14,330
Shareholder servicing agent fees ..... 4,962 6,087 5,970
Insurance expense .................... 2,383 1,110 3,380
Registration and filing fees ......... 19,991 18,156 33,556
Amortization of organization
expenses (Note 1f) .................. 1,234 1,738 1,445
Distribution fees -- Shares
(Note 2e) ........................... -- -- --
Miscellaneous ........................ 7,497 3,990 10,071
----------- ------------- ------------
Total Expenses ...................... 1,357,756 580,886 1,791,902
Less: Waiver of fees (Note 2c) ...... (298,579) (262,853) (781,974)
----------- ------------- ------------
Net Expenses ........................ 1,059,177 318,033 1,009,928
----------- ------------- ------------
Net Investment Income (Loss) .......... 431,024 3,543,754 11,156,699
----------- ------------- ------------
Realized and Unrealized Gain (Loss)
(Note 1):
Net realized gain on investments ..... 11,056,827 1,294,824 3,877,687
Net realized loss on foreign
currency transactions ............... -- -- --
Change in unrealized
appreciation/depreciation
of investments and foreign
currency translations during the
year ................................ 18,360,482 (1,175,763) (4,548,009)
----------- ------------- ------------
Net Realized and Unrealized Gain
(Loss) ............................... 29,417,309 119,061 (670,322)
----------- ------------- ------------
Net Increase (Decrease) in Net
Assets Resulting from Operations ..... $29,848,333 $ 3,662,815 $ 10,486,377
=========== ============= ============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
International Optimum Value
Balanced Equity Growth Equity
Fund Fund Fund Fund
---------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Investment Income
Dividend income ...................... $ 824,522 $ 843,596 $ 464,280 $ 538,890
Interest income ...................... 1,901,267 108,645 37,768 8,154
Less: Foreign taxes withheld ......... -- (82,817) -- --
------------- ------------ ----------- -------------
Total Income ........................ 2,725,789 869,424 502,048 547,044
Expenses (Note 1g):
Investment advisory fees (Note 2a) 427,031 417,506 460,546 226,293
Administration fees (Note 2b) ........ 100,517 83,501 108,405 53,266
Custodian fees ....................... 20,178 65,078 19,921 9,052
Legal and audit fees ................. 15,463 7,913 15,358 6,956
Prospectus and shareholder
reports ............................. 16,097 18,055 10,627 4,961
Trustees' fees and expenses
(Note 2f) ........................... 5,069 2,682 5,002 2,400
Shareholder servicing agent fees ..... 11,136 7,878 10,845 7,636
Insurance expense .................... 1,967 794 1,079 613
Registration and filing fees ......... 27,960 31,121 22,178 22,709
Amortization of organization
expenses (Note 1f) .................. 5,683 1,201 244 244
Distribution fees -- Shares
(Note 2e) ........................... 33,141 -- 27,903 273
Miscellaneous ........................ 4,777 3,190 3,205 2,433
------------- ------------ ----------- -------------
Total Expenses ...................... 669,019 638,919 685,313 336,836
Less: Waiver of fees (Note 2c) ...... (175,998) (263,217) (155,809) (91,255)
------------- ------------ ----------- -------------
Net Expenses ........................ 493,021 375,702 529,504 245,581
------------- ------------ ----------- -------------
Net Investment Income (Loss) .......... 2,232,768 493,722 (27,456) 301,463
------------- ------------ ----------- -------------
Realized and Unrealized Gain (Loss)
(Note 1):
Net realized gain on investments ..... 5,203,710 1,597,388 4,906,503 2,731,686
Net realized loss on foreign
currency transactions ............... -- (44,361) -- (1,063)
Change in unrealized
appreciation/depreciation
of investments and foreign
currency translations during the
year ................................ (13,305,418) (4,178,241) 35,505,018 (1,255,930)
------------- ------------ ----------- -------------
Net Realized and Unrealized Gain
(Loss) ............................... (8,101,708) (2,625,214) 40,411,521 1,474,693
------------- ------------ ----------- -------------
Net Increase (Decrease) in Net
Assets Resulting from Operations ..... $ (5,868,940) $ (2,131,492) $40,384,065 $ 1,776,156
============= ============ =========== =============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Equity Fund
------------------------------------
Year Ended Year Ended
March 31, March 31,
1999 1998
----------------- -----------------
<S> <C> <C>
Operations:
Net investment income ................. $ 431,024 $ 577,988
Net realized gain on investments 11,056,827 13,078,300
Change in unrealized
appreciation/depreciation of
investments during the year .......... 18,360,482 39,624,075
------------- -------------
Net increase in net assets
resulting from operations .......... 29,848,333 53,280,363
Distributions to Shareholders:
From net investment income ............ (435,000) (644,350)
In excess of net investment
income ............................... -- --
From net realized gains ............... (2,446,333) (15,372,442)
In excess of net realized gains ....... -- --
------------- -------------
Total distributions to
shareholders ....................... (2,881,333) (16,016,792)
------------- -------------
Transactions in Shares of Beneficial
Interest:
Net proceeds from shares sold ......... 47,139,416 33,699,430
Contribution in-kind .................. -- --
Reinvestment of dividends ............. 7,322 405,457
Cost of shares redeemed ............... (32,332,217) (51,602,372)
------------- -------------
Net increase (decrease) in
net assets from beneficial
interest transactions .............. 14,814,521 (17,497,485)
------------- -------------
Total Increase in Net Assets ........ 41,781,521 19,766,086
Net Assets:
Beginning of Year ..................... 138,328,097 118,562,011
------------- -------------
End of Year (a) ....................... $ 180,109,618 $ 138,328,097
============= =============
Capital Share Transactions:
Institutional Shares sold ............. 3,624,176 3,017,785
Contribution in-kind .................. -- --
Institutional Shares issued for
dividend reinvestment ................ 580 37,320
Institutional Shares redeemed ......... (2,478,541) (4,449,056)
------------- -------------
Net Increase (Decrease) in Shares
Outstanding ........................... 1,146,215 (1,393,951)
============= =============
------------
(a) Including undistributed
(distributions in excess of) net
investment income .................. $ 110,555 $ 114,531
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Income Fund Total Return Bond Fund
---------------------------------- -----------------------------------
Year Ended Year Ended Year Ended Year Ended
March 31, March 31, March 31, March 31,
1999 1998 1999 1998
---------------- ---------------- ----------------- ----------------
<S> <C> <C> <C> <C>
Operations:
Net investment income ................. $ 3,543,754 $ 3,303,028 $ 11,156,699 $ 8,940,752
Net realized gain on investments 1,294,824 990,393 3,877,687 2,353,952
Change in unrealized
appreciation/depreciation of
investments during the year .......... (1,175,763) 1,583,858 (4,548,009) 5,697,218
------------ ------------ ------------- -------------
Net increase in net assets
resulting from operations .......... 3,662,815 5,877,279 10,486,377 16,991,922
Distributions to Shareholders:
From net investment income ............ (3,538,256) (3,299,499) (11,156,710) (8,941,053)
In excess of net investment
income ............................... (24,317) (3,529) -- --
From net realized gains ............... (2,171,930) (183,152) (5,489,069) (1,220,129)
In excess of net realized gains ....... -- -- (523,866) --
------------ ------------ ------------- -------------
Total distributions to
shareholders ....................... (5,734,503) (3,486,180) (17,169,645) (10,161,182)
------------ ------------ ------------- -------------
Transactions in Shares of Beneficial
Interest:
Net proceeds from shares sold ......... 8,666,814 12,191,434 119,082,504 49,920,677
Contribution in-kind .................. -- -- 12,430,061 --
Reinvestment of dividends ............. -- -- 358,289 134,539
Cost of shares redeemed ............... (729,572) (4,290,648) (41,284,954) (27,577,046)
------------ ------------ ------------- -------------
Net increase (decrease) in
net assets from beneficial
interest transactions .............. 7,937,242 7,900,786 90,585,900 22,478,170
------------ ------------ ------------- -------------
Total Increase in Net Assets ........ 5,865,554 10,291,885 83,902,632 29,308,910
Net Assets:
Beginning of Year ..................... 61,374,149 51,082,264 167,711,255 138,402,345
------------ ------------ ------------- -------------
End of Year (a) ....................... $ 67,239,703 $ 61,374,149 $ 251,613,887 $ 167,711,255
============ ============ ============= =============
Capital Share Transactions:
Institutional Shares sold ............. 1,221,301 1,695,891 15,800,759 6,736,023
Contribution in-kind .................. -- -- 1,646,253 --
Institutional Shares issued for
dividend reinvestment ................ -- -- 47,445 18,167
Institutional Shares redeemed ......... (100,468) (610,049) (5,458,140) (3,735,567)
------------ ------------ ------------- -------------
Net Increase (Decrease) in Shares
Outstanding ........................... 1,120,833 1,085,842 12,036,317 3,018,623
============ ============ ============= =============
------------
(a) Including undistributed
(distributions in excess of) net
investment income .................. $ (24,317) $ (3,529) $ 16,857 $ 35,252
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Changes in Net Assets -- (continued)
<TABLE>
<CAPTION>
Balanced Fund International Equity Fund
--------------------------------- --------------------------------
Year Ended Year Ended Year Ended Year Ended
March 31, March 31, March 31, March 31,
1999 1998 1999 1998
---------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Operations:
Net investment income .................................. $ 2,232,768 $ 3,368,479 $ 493,722 $ 458,891
Net realized gain on investments ....................... 5,203,710 12,929,382 1,597,388 487,012
Net realized loss on foreign currency transactions ..... -- -- (44,361) (37,743)
Change in unrealized appreciation/depreciation of
investments and foreign currency translations
during the year ....................................... (13,305,418) 5,190,357 (4,178,241) 2,474,310
------------- ------------- ------------- -------------
Net increase (decrease) in net assets resulting
from operations .................................... (5,868,940) 21,488,218 (2,131,492) 3,382,470
Distributions to Shareholders:
From net investment income
Institutional Shares .................................. (1,976,559) (3,042,093) (646,625) (318,203)
Shares ................................................ (430,454) (319,761) -- --
In excess of net investment income
Institutional Shares .................................. -- -- -- (110,649)
From net realized gains
Institutional Shares .................................. (1,935,917) (7,725,226) (1,213,291) (661,743)
Shares ................................................ (301) (1,876,320) -- --
In excess of net realized gains
Institutional Shares .................................. -- -- (508,833) --
------------- ------------- ------------- -------------
Total distributions to shareholders .................. (4,343,231) (12,963,400) (2,368,749) (1,090,595)
------------- ------------- ------------- -------------
Transactions in Shares of Beneficial Interest:
Net proceeds from shares sold
Institutional Shares .................................. 11,765,678 21,742,743 66,156,100 23,093,069
Shares ................................................ 703,946 20,319,193 -- --
Reinvestment of dividends
Institutional Shares .................................. 896 3,590 -- 8,515
Shares ................................................ 292,046 2,196,081 -- --
Cost of shares redeemed
Institutional Shares .................................. (40,693,170) (57,967,499) (23,290,314) (23,426,766)
Shares ................................................ (18,755,099) (1,878,906) -- --
------------- ------------- ------------- -------------
Net increase (decrease) in net assets from
beneficial interest transactions ................... (46,685,703) (15,584,798) 42,865,786 (325,182)
------------- ------------- ------------- -------------
Total Increase (Decrease) in Net Assets ............ (56,897,874) (7,059,980) 38,365,545 1,966,693
Net Assets:
Beginning of Year ...................................... 89,902,519 96,962,499 40,436,354 38,469,661
------------- ------------- ------------- -------------
End of Year (a) ........................................ $ 33,004,645 $ 89,902,519 $ 78,801,899 $ 40,436,354
============= ============= ============= =============
</TABLE>
<PAGE>
(continued from previous page)
<TABLE>
<CAPTION>
Balanced Fund International Equity Fund
--------------------------------- --------------------------------
Year Ended Year Ended Year Ended Year Ended
March 31, March 31, March 31, March 31,
1999 1998 1999 1998
---------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Capital Share Transactions:
Shares sold:
Institutional Shares .................................. 1,427,074 2,483,939 7,789,693 2,482,442
Shares (b) ............................................ 79,974 2,179,728 -- --
Shares issued for dividend reinvestment:
Institutional Shares .................................. 107 418 -- 877
Shares (b) ............................................ 32,797 256,143 -- --
Shares redeemed:
Institutional Shares .................................. (5,010,073) (6,477,987) (2,642,321) (2,564,182)
Shares (b) ............................................ (2,342,728) (204,889) -- --
------------- ------------- ------------- -------------
Net Increase (Decrease) in Shares Outstanding ........... (5,812,849) (1,762,648) 5,147,372 (80,863)
============= ============= ============= =============
------------
(a) Including undistributed (distributions in
excess of) net investment income .................... $ 553,154 $ 726,375 $ 28,435 $ (110,649)
(b) Initial offering of Shares commenced on August
25, 1997 for Balanced Fund.
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Changes in Net Assets -- (continued)
<TABLE>
<CAPTION>
Optimum Growth Fund Value Equity Fund
----------------------------------- --------------------------------
Year Ended Year Ended Year Ended Year Ended
March 31, March 31, March 31, March 31,
1999 1998 1999 1998
----------------- ---------------- ---------------- --------------
<S> <C> <C> <C> <C>
Operations:
Net investment income (loss) ............................. $ (27,456) $ 81,809 $ 301,463 $ 243,228
Net realized gain (loss) on investments .................. 4,906,503 (2,090,039) 2,731,686 2,142,877
Net realized loss on foreign currency transactions ....... -- -- (1,063) --
Change in unrealized appreciation/depreciation of
investments and foreign currency translations during
the year ................................................ 35,505,018 22,166,451 (1,255,930) 9,909,167
------------- ------------ ------------ ------------
Net increase in net assets resulting from operations ... 40,384,065 20,158,221 1,776,156 12,295,272
Distributions to Shareholders:
From net investment income
Institutional Shares .................................... (10,785) (123,146) (276,362) (230,995)
Shares .................................................. -- (4,167) (217) (363)
From net realized gains
Institutional Shares .................................... -- -- (3,002,331) (1,695,764)
Shares .................................................. -- -- (6,437) (5,580)
------------- ------------ ------------ ------------
Total distributions to shareholders .................... (10,785) (127,313) (3,285,347) (1,932,702)
------------- ------------ ------------ ------------
Transactions in Shares of Beneficial Interest:
Net proceeds from shares sold
Institutional Shares .................................... 16,636,464 8,293,581 6,929,195 1,679,381
Shares .................................................. 2,171,420 2,776,946 46,060 31,723
Reinvestment of dividends
Institutional Shares .................................... 569 4,030 -- --
Shares .................................................. -- 875 2,707 1,672
Cost of shares redeemed
Institutional Shares .................................... (15,767,433) (1,722,710) (880,640) (937,737)
Shares .................................................. (997,974) (1,880,728) (461) (37,415)
------------- ------------ ------------ ------------
Net increase in net assets from beneficial interest
transactions ......................................... 2,043,046 7,471,994 6,096,861 737,624
------------- ------------ ------------ ------------
Total Increase in Net Assets ......................... 42,416,326 27,502,902 4,587,670 11,100,194
Net Assets:
Beginning of Year ........................................ 58,042,528 30,539,626 34,843,474 23,743,280
------------- ------------ ------------ ------------
End of Year (a) .......................................... $ 100,458,854 $ 58,042,528 $ 39,431,144 $ 34,843,474
============= ============ ============ ============
Capital Share Transactions:
Shares Sold:
Institutional Shares .................................... 812,340 614,403 466,461 131,715
Shares .................................................. 105,092 210,824 3,120 2,111
Shares issued for dividend reinvestment:
Institutional Shares .................................... 35 332 -- --
Shares .................................................. -- 83 190 123
Shares redeemed:
Institutional Shares .................................... (766,399) (132,059) (59,957) (65,278)
Shares .................................................. (56,822) (135,970) (31) (2,373)
------------- ------------ ------------ ------------
Net Increase in Shares Outstanding ........................ 94,246 557,613 409,783 66,298
============= ============ ============ ============
------------
(a) Including undistributed net investment income ......... $ -- $ 6,771 $ 87,696 $ 63,875
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Financial Highlights
<TABLE>
<CAPTION>
Selected data for a share outstanding throughout each period are as follows:
Equity Fund
----------------------------------------------------------------------------
Ten Months January 16,
Year Ended Year Ended Ended Year Ended 1995(b) to
March 31, March 31, March 31, May 31, May 31,
1999 1998 1997 (a) 1996 1995
------------ ------------ ---------------- ------------ ----------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ....... $ 12.69 $ 9.65 $ 8.93 $ 7.73 $ 7.00
------- ------- --------- ------ ---------
Investment Operations:
Net investment income ..................... 0.04 0.05 0.05 0.11 0.05
Net realized and unrealized gain (loss)
on investments ........................... 2.47 4.67 0.86 1.20 0.70
------- ------- --------- ------ ---------
Total From Investment Operations ......... 2.51 4.72 0.91 1.31 0.75
------- ------- --------- ------ ---------
Distributions:
From net investment income ................ (0.04) (0.06) (0.07) (0.11) (0.02)
In excess of net investment income ........ -- -- -- -- --
From net realized gains ................... (0.20) (1.62) (0.12) -- --
------- -------- --------- ------- ---------
Total Distributions ...................... (0.24) (1.68) (0.19) (0.11) (0.02)
------- -------- --------- ------- ---------
Net Asset Value, End of Period ............. $ 14.96 $ 12.69 $ 9.65 $ 8.93 $ 7.73
======= ======== ========= ======= =========
Total Return ............................... 20.13% 51.58% 10.22%(c) 17.04% 10.80%(c)
======= ======== ========= ======= =========
Ratios and Supplemental Data:
Ratios to Average Net Assets
Net Expenses .............................. 0.70% 0.70% 0.70%(e) 0.36% 0.12%(e)
Gross Expenses (d) ........................ 0.90% 0.90% 0.92%(e) 1.49% 2.67%(e)
Net Investment Income ..................... 0.28% 0.46% 0.70%(e) 1.32% 2.44%(e)
Portfolio Turnover ......................... 37% 26% 32%(e) 113% 34%(e)
Net Assets at end of Period
(000's omitted) ........................... $180,110 $138,328 $ 118,562 $23,495 $ 15,409
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Income Fund
----------------------------------------------------------------------------
Ten Months January 16,
Year Ended Year Ended Ended Year Ended 1995(b) to
March 31, March 31, March 31, May 31, May 31,
1999 1998 1997(a) 1996 1995
------------ ------------ ---------------- ------------ ----------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ....... $ 7.23 $ 6.90 $ 6.99 $ 7.33 $ 7.00
------- ------- --------- ------- ---------
Investment Operations:
Net investment income ..................... 0.40 0.44 0.38 0.51 0.19
Net realized and unrealized gain (loss)
on investments ........................... 0.03 0.35 (0.01) (0.27) 0.33
------- ------- --------- ------- ---------
Total From Investment Operations ......... 0.43 0.79 0.37 0.24 0.52
------- ------- --------- ------- ---------
Distributions:
From net investment income ................ (0.41) (0.44) (0.38) (0.51) (0.19)
In excess of net investment income ........ --(f) --(f) -- -- --
From net realized gains ................... (0.25) (0.02) (0.08) (0.07) --
------- ------- --------- ------- ---------
Total Distributions ...................... (0.66) (0.46) (0.46) (0.58) (0.19)
------- ------- --------- ------- ---------
Net Asset Value, End of Period ............. $ 7.00 $ 7.23 $ 6.90 $ 6.99 $ 7.33
======= ======= ========= ======= =========
Total Return ............................... 5.94% 11.78% 5.39%(c) 3.18% 7.51%(c)
======= ======= ========= ======= =========
Ratios and Supplemental Data:
Ratios to Average Net Assets
Net Expenses .............................. 0.50% 0.50% 0.50%(e) 0.26% 0.12%(e)
Gross Expenses (d) ........................ 0.91% 0.91% 0.96%(e) 1.35% 1.65%(e)
Net Investment Income ..................... 5.57% 6.14% 6.50%(e) 6.99% 7.17%(e)
Portfolio Turnover ......................... 196% 190% 107%(e) 67% 34%(e)
Net Assets at end of Period
(000's omitted) ........................... $67,240 $61,374 $ 51,082 $24,001 $ 33,230
----------
(a) The Fund changed its fiscal year end to March 31.
(b) Commencement of Operations
(c) Not annualized
(d) Expense ratios before waiver of fees and reimbursement of expenses, if any, by the adviser and administrators.
(e) Annualized
(f) Amount represents less than $0.01 per share.
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Financial Highlights -- (continued)
<TABLE>
<CAPTION>
Selected data for a share outstanding throughout each period are as follows:
Total Return Bond Fund
----------------------------------------------------------------------------
Ten Months January 19,
Year Ended Year Ended Ended Year Ended 1995(b) to
March 31, March 31, March 31, May 31, May 31,
1999 1998 1997(a) 1996 1995
------------ ------------ ---------------- ------------ ----------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ....... $ 7.51 $ 7.16 $ 7.18 $ 7.47 $ 7.00
-------- ------- --------- -------- ---------
Investment Operations:
Net investment income ..................... 0.42 0.44 0.37 0.48 0.18
Net realized and unrealized gain (loss)
on investments ............................ 0.03 0.41 0.01 (0.17) 0.47
-------- ------- --------- -------- ---------
Total From Investment Operations .......... 0.45 0.85 0.38 0.31 0.65
-------- ------- --------- -------- ---------
Distributions:
From net investment income ................ (0.42) (0.44) (0.37) (0.48) (0.18)
In excess of net investment income ........ -- -- -- -- --
From net realized gains ................... (0.20) (0.06) (0.03) (0.12) --
In excess of net realized gains ........... (0.02) -- -- -- --
-------- -------- --------- -------- ---------
Total Distributions ....................... (0.64) (0.50) (0.40) (0.60) (0.18)
-------- -------- --------- -------- ---------
Net Asset Value, End of Period ............. $ 7.32 $ 7.51 $ 7.16 $ 7.18 $ 7.47
======== ======== ========= ======== =========
Total Return ............................... 6.07% 12.21% 5.29%(c) 4.20% 9.40%(c)
======== ======== ========= ======== =========
Ratios and Supplemental Data:
Ratios to Average Net Assets
Net Expenses .............................. 0.50% 0.50% 0.50%(e) 0.32% 0.12%(e)
Gross Expenses (d) ........................ 0.89% 0.90% 0.92%(e) 1.33% 1.93%(e)
Net Investment Income ..................... 5.53% 5.95% 6.08%(e) 6.47% 7.09%(e)
Portfolio Turnover ......................... 234% 196% 200%(e) 127% 84%(e)
Net Assets at end of Period
(000's omitted) ........................... $251,614 $167,711 $ 138,402 $ 65,017 $ 24,913
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Balanced Fund
----------------------------------------------------------------------------
Ten Months July 11,
Year Ended Year Ended Ended Year Ended 1994(b) to
March 31, March 31, March 31, May 31, May 31,
1999+ 1998 1997(a) 1996 1995
------------ ------------ ---------------- ------------ ----------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ....... $ 9.08 $ 8.31 $ 8.26 $ 7.70 $ 7.00
------- ------- --------- ------ ---------
Investment Operations:
Net investment income ..................... 0.29 0.33 0.26 0.34 0.35
Net realized and unrealized gain (loss)
on investments ............................ (0.74) 1.66 0.40 0.78 0.64
------- ------- --------- ------ ---------
Total From Investment Operations .......... (0.45) 1.99 0.66 1.12 0.99
------- ------- --------- ------ ---------
Distributions:
From net investment income ................ (0.27) (0.30) (0.28) (0.36) (0.26)
In excess of net investment income ........ -- -- -- -- --
From net realized gains ................... (0.30) (0.92) (0.33) (0.20) (0.03)
In excess of net realized gains ........... -- -- -- -- --
------- ------- --------- ------- ---------
Total Distributions ....................... (0.57) (1.22) (0.61) (0.56) (0.29)
------- ------- --------- ------- ---------
Net Asset Value, End of Period ............. $ 8.06 $ 9.08 $ 8.31 $ 8.26 $ 7.70
======= ======= ========= ======= =========
Total Return ............................... (4.84)% 25.12% 8.20%(c) 15.07% 14.59%(c)
======= ======= ========= ======= =========
Ratios and Supplemental Data:
Ratios to Average Net Assets
Net Expenses .............................. 0.70% 0.70% 0.70%(e) 0.38% 0.12%(e)
Gross Expenses (d) ........................ 0.97% 0.92% 0.93%(e) 1.21% 1.32%(e)
Net Investment Income ..................... 3.46% 3.57% 3.84%(e) 4.34% 5.55%(e)
Portfolio Turnover ......................... 44% 75% 53%(e) 56% 57%(e)
Net Assets at end of Period
(000's omitted) ........................... $33,996 $69,667 $ 96,962 $95,638 $ 74,478
----------
(a) The Fund changed its fiscal year end to March 31.
(b) Commencement of Operations
(c) Not annualized
(d) Expense ratios before waiver of fees and reimbursement of expenses, if any, by the
adviser and administrators.
(e) Annualized
+ For comparative purposes per share amounts for the year ended March 31, 1999 are based
on average shares outstanding.
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Financial Highlights -- (continued)
Selected data for a share outstanding throughout each period are as follows:
<TABLE>
<CAPTION>
International Equity Fund
----------------------------------------------------------------------------
Ten Months January 24,
Year Ended Year Ended Ended Year Ended 1995(b) to
March 31, March 31, March 31, May 31, May 31,
1999 1998 1997(a) 1996 1995
------------ ------------ ---------------- ------------ ----------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning
of Period ..................... $ 9.67 $ 9.03 $ 8.99 $ 7.88 $ 7.00
------- ------ --------- ------ ---------
Investment Operations:
Net investment income ......... 0.16 0.09 0.01 0.09 0.08
Net realized and
unrealized gain (loss)
on investments ............... (0.79) 0.79 0.21 1.20 0.80
------- ------ --------- ------ ---------
Total From Investment
Operations ................... (0.63) 0.88 0.22 1.29 0.88
------- ------ --------- ------ ---------
Distributions:
From net investment
income ....................... (0.16) (0.07) (0.06) (0.12) --
In excess of net
investment income ............ -- (0.02) (0.03) -- --
From net realized gains ....... (0.30) (0.15) (0.09) (0.06) --
In excess of net realized
gains ........................ (0.13) -- -- -- --
------- ------- --------- ------- ---------
Total Distributions .......... (0.59) (0.24) (0.18) (0.18) --
------- ------- --------- ------- ---------
Net Asset Value, End of
Period ........................ $ 8.45 $ 9.67 $ 9.03 $ 8.99 $ 7.88
======= ======= ========= ======= =========
Total Return ................... (6.60)% 9.90% 2.41%(c) 16.58% 12.57%(c)
======= ======= ========= ======= =========
Ratios and Supplemental
Data:
Ratios to Average Net Assets
Net Expenses .................. 0.90% 0.90% 0.90%(e) 0.60% 0.25%(e)
Gross Expenses (d) ............ 1.53% 1.43% 1.49%(e) 2.05% 3.32%(e)
Net Investment Income ......... 1.18% 1.05% 0.45%(e) 1.71% 3.47%(e)
Portfolio Turnover ............. 107% 52% 45%(e) 19% 8%(e)
Net Assets at end of Period
(000's omitted) ............... $78,802 $40,436 $ 38,470 $24,522 $ 8,804
</TABLE>
<PAGE>
Excelsior Institutional Trust
Financial Highlights -- (continued)
Selected data for a share outstanding throughout each period are as follows:
<TABLE>
<CAPTION>
Optimum Growth Fund Value Equity Fund
-------------------------------------------- --------------------------------------------
June 1, June 1,
Year Ended Year Ended 1996(b) to Year Ended Year Ended 1996(b) to
March 31, March 31, March 31, March 31, March 31, March 31,
1999 1998 1997 1999 1998 1997
------------ ------------ ---------------- ------------ ------------ ----------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning
of Period ..................... $ 16.33 $ 10.19 $ 10.00 $ 16.12 $ 11.33 $ 10.00
------- ------- --------- ------- ------- ---------
Investment Operations:
Net investment income ......... --(f) 0.03 0.05 0.13 0.11 0.08
Net realized and
unrealized gain (loss)
on investments ............... 11.22 6.15 0.17 0.52 5.59 1.31
------- ------- --------- ------- ------- ---------
Total From Investment
Operations ................... 11.22 6.18 0.22 0.65 5.70 1.39
------- ------- --------- ------- ------- ---------
Distributions:
From net investment
income ....................... --(f) (0.04) (0.03) (0.12) (0.11) (0.06)
In excess of net
investment income ............ -- -- -- -- -- --
From net realized gains ....... -- -- -- (1.32) (0.80) --
In excess of net realized
gains ........................ -- -- -- -- -- --
------- ------- --------- ------- ------- ---------
Total Distributions .......... --(f) (0.04) (0.03) (1.44) (0.91) (0.06)
------- ------- --------- ------- ------- ---------
Net Asset Value, End of
Period ........................ $ 27.55 $ 16.33 $ 10.19 $ 15.33 $ 16.12 $ 11.33
======= ======= ========= ======= ======= =========
Total Return ................... 68.74% 60.85% 2.23%(c) 4.80% 51.67% 13.91%(c)
======= ======= ========= ======= ======= =========
Ratios and Supplemental
Data:
Ratios to Average Net Assets
Net Expenses .................. 0.71% 0.70% 0.70%(e) 0.70% 0.70% 0.70%(e)
Gross Expenses (d) ............ 0.93% 0.97% 1.11%(e) 0.97% 1.00% 1.12%(e)
Net Investment Income ......... 0.00% 0.23% 0.66%(e) 0.87% 0.81% 0.94%(e)
Portfolio Turnover ............. 22% 19% 20%(e) 55% 51% 64%(e)
Net Assets at end of Period
(000's omitted) ............... $88,045 $51,441 $ 27,183 $39,307 $34,766 $ 23,687
----------
(a) The Fund changed its fiscal year end to March 31.
(b) Commencement of Operations
(c) Not annualized
(d) Expense ratios before waiver of fees and reimbursement of expenses, if any, by the adviser and administrators.
(e) Annualized
(f) Amount represents less than $0.01 per share.
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements
1. Significant Accounting Policies:
Excelsior Institutional Trust (the "Trust") is a business trust organized
under the laws of the State of Delaware on May 11, 1994. The Trust is
registered under the Investment Company Act of 1940 ("Act") and the Securities
Act of 1933 as an open-end diversified management investment company. The Trust
currently offers shares in the following seven funds (each a "Fund",
collectively, the "Funds"), each having its own investment objectives and
policies: Excelsior Equity Fund ("Equity Fund"), Excelsior Income Fund ("Income
Fund"), Excelsior Total Return Bond Fund ("Total Return Bond Fund"), Excelsior
Balanced Fund ("Balanced Fund"), Excelsior International Equity Fund
("International Equity Fund"), Excelsior Optimum Growth Fund ("Optimum Growth
Fund") and Excelsior Value Equity Fund ("Value Equity Fund"). With regard to
Balanced Fund, International Equity Fund, Optimum Growth Fund and Value Equity
Fund, the Trust offers two classes of shares: Institutional Shares and Shares
(formerly, "Trust Shares"). At March 31, 1999, International Equity Fund has
not issued Shares. The Financial Highlights of the Shares are presented in
separate annual reports.
The following is a summary of the significant accounting policies of the
Funds. Such policies are in conformity with generally accepted accounting
principles for investment companies and are consistently followed by the Funds
in the preparation of the financial statements. Generally accepted accounting
principles require management to make estimates and assumptions that affect the
reported amounts and disclosures on the financial statements. Actual results
could differ from these estimates.
a) Valuation of Investments -- Investments in securities that are traded
on a recognized domestic stock exchange are valued at the last sale price on
the exchange on which such securities are primarily traded or at the last sale
price on a national securities market. Securities traded over-the-counter are
valued each business day on the basis of closing over-the-counter bid prices.
Securities for which there were no transactions are valued at the average of
the most recent bid and asked prices (as calculated by an independent pricing
service (the "Service") based upon its evaluation of the market for such
securities) when, in the judgment of the Service, quoted bid and asked prices
for securities are readily available and are representative of the market. Bid
price is used when no asked price is available. Investments in securities that
are primarily traded on foreign securities exchanges are generally valued at
the preceding closing values of such securities on their respective exchanges,
except that when an occurrence subsequent to the time a value is so established
is likely to have changed such value, then a fair value of those securities
will be determined by consideration of other factors under the direction of the
Funds' Trustees. A security which is traded on more than one exchange is valued
at the quotation on the exchange determined to be the primary market on which
the security is traded.
All other foreign securities are valued at the last current bid quotation
if market quotations are available, or at fair value as determined in
accordance with policies established by the Board of Trustees. Investment
valuations, other assets, and liabilities initially expressed in foreign
currencies are converted each business day into U.S. dollars based upon current
exchange rates. Purchases and sales of foreign investments and income and
expenses are converted into U.S. dollars based upon currency exchange rates
prevailing upon the respective dates of such transactions. Gains and losses
attributable to foreign currency exchange rates are recorded for financial
statement purposes as net realized gains and losses on investments. That
portion of both realized and unrealized gains and losses on investments that
results from fluctuations in foreign currency exchange rates is not separately
disclosed.
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements -- (Continued)
Securities for which market quotations are not readily available are
valued at fair value pursuant to guidelines adopted by the Funds' Trustees.
Short-term debt instruments with remaining maturities of 60 days or less are
valued at amortized cost, which approximates market value.
b) Forward foreign currency exchange contracts -- The International Equity
Fund's participation in forward foreign currency exchange contracts will be
limited to hedging involving either specific transactions or portfolio
positions. Transaction hedging involves the purchase or sale of foreign
currency with respect to specific receivables or payables of a Fund generally
arising in connection with the purchase or sale of its portfolio securities.
Risk may arise upon entering into these contracts from the potential inability
of counterparties to meet the terms of their contracts and is generally limited
to the amount of unrealized gain on the contracts, if any, on the date of
default. Risk may also arise from unanticipated movements in the value of a
foreign currency relative to the U.S. dollar. Contracts are marked-to-market
daily and the change in market value is recorded as unrealized appreciation or
depreciation. Realized gains and losses arising from such transactions are
included in net realized gains or losses from foreign currency transactions.
c) 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 identified cost. Interest income, including
where applicable, amortization of discounts and premiums 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 Fund is informed of the dividend.
d) Dividends to Shareholders -- Dividends equal to all or substantially
all of each Fund's net investment income will be declared and paid as follows:
For the Equity Fund, Balanced Fund, Optimum Growth Fund, and Value Equity Fund,
dividends will be declared and paid at least quarterly; for the Income Fund and
Total Return Bond Fund, dividends will be declared daily and paid monthly; and
for the International Equity Fund, dividends will be declared and paid at least
once a year. Distributions to shareholders of net realized capital gains, if
any, are normally declared and paid annually, but the Funds may make
distributions on a more frequent basis to comply with the distribution
requirements of the Internal Revenue Code. To the extent that net realized
capital gain can be offset by capital loss carryovers, if any, it is the policy
of the Trust not to distribute such gain.
Dividends and distributions are determined in accordance with Federal
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
foreign currency transactions, passive foreign investment companies, deferral
of losses on wash sales, and net capital losses incurred after October 31 and
within the taxable year ("Post-October losses").
In order to avoid a Federal excise tax, each Fund is required to
distribute certain minimum amounts of net realized capital gain and net
investment income for the respective periods ending October 31 and December 31
in each calendar year.
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements -- (Continued)
e) Repurchase agreements -- The Funds may purchase portfolio securities
from financial institutions deemed to be creditworthy by the investment adviser
subject to the seller's agreement to repurchase and the Funds' agreement to
resell such securities at mutually agreed upon prices. Securities purchased
subject to such repurchase agreements are deposited with the Funds' custodian
or are maintained in the Federal Reserve/Treasury book-entry system and must
have, at all times, an aggregate market value not less than the repurchase
price.
If the value of the underlying security falls below the value of the
repurchase price, the Funds will require the seller to deposit additional
collateral by the next business day. Default or bankruptcy of the seller may,
however, expose the applicable Fund to possible delay in the connection with
the disposition of the underlying securities or loss to the extent that
proceeds from the sale of the underlying securities were less than the
repurchase price under the agreement.
f) Deferred Organization Expense -- Expenses incurred by each Fund in
connection with its organization are being amortized on a straight-line basis
over a five year period.
g) Expense Allocation -- Expenses incurred by the Trust with respect to
any two or more Funds in the Trust are allocated in proportion to the average
net assets of each Fund, except where allocations of direct expenses to each
Fund can otherwise be fairly made. Expenses directly attributable to a Fund are
charged to that Fund and expenses directly attributable to a particular class
of shares in a Fund are charged to such class.
h) Federal Income Taxes -- It is the policy of each Fund to continue to
qualify as a regulated investment company, if such qualification is in the best
interest of the shareholders, by complying with the requirements of the
Internal Revenue Code of 1986, as amended, applicable to regulated investment
companies, and by distributing substantially all of its taxable earnings to its
shareholders.
During the year ended March 31, 1999, the Optimum Growth Fund utilized
capital loss carryforwards for federal tax purposes totaling approximately
$1,494,000.
Post-October losses are deemed to arise on the first business day of a
Portfolio's next taxable year. International Equity Fund incurred, and elected
to defer, net currency losses of approximately $18,000 for the year ended March
31, 1999. In addition, Total Return Bond Fund, International Equity Fund and
Value Equity Fund incurred, and elected to defer, net capital losses of
approximately $524,000, $545,000 and $7,000, respectively, for the year ended
March 31, 1999.
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements -- (Continued)
At March 31, 1999, the aggregate cost and gross unrealized appreciation and
gross unrealized depreciation in the value of investments owned by the Funds, as
computed on a federal tax basis, were as follows:
<TABLE>
<CAPTION>
Total
Return International Optimum Value
Equity Income Bond Balanced Equity Growth Equity
Fund Fund Fund Fund Fund Fund Fund
------------- ----------- ------------ ----------- ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Aggregate Cost ...... $113,624,263 $68,404,052 $251,996,858 $29,262,358 $ 77,993,391 $41,784,940 $ 28,447,285
============ =========== ============ =========== ============ =========== ============
Gross unrealized
appreciation ....... $ 69,074,205 $ 139,456 $ 288,335 $ 4,630,131 $ 5,821,561 $58,670,054 $ 12,620,906
------------ ----------- ------------ ----------- ------------ ----------- ------------
Gross unrealized
depreciation ....... (2,210,282) (649,289) (1,816,544) (832,054) (4,281,993) (321,925) (1,365,768)
------------ ----------- ------------ ----------- ------------ ----------- ------------
Net unrealized
appreciation
(depreciation) ..... $ 66,863,923 $ (509,833) $ (1,528,209) $ 3,798,077 $ 1,539,568 $58,348,129 $ 11,255,138
============ =========== ============ =========== ============ =========== ============
</TABLE>
2. Investment Advisory Fee, Administration Fee, Distribution Expenses and
Related Party Transactions:
a) United States Trust Company of New York ("U.S. Trust NY") and U.S. Trust
Company of Connecticut ("U.S. Trust CT" and, collectively with U.S. Trust NY,
"U.S. Trust") serve as the investment adviser to the Equity Fund, Income Fund,
Total Return Bond Fund, Optimum Growth Fund, Value Equity Fund, and effective
December 28, 1998, International Equity Fund. For the services provided pursuant
to the Investment Advisory Agreements, U.S. Trust is entitled to receive a fee,
computed daily and paid monthly, at the annual rate of 0.65% of the average
daily net assets of each Fund other than the International Equity Fund, and
1.00% of the International Equity Fund's average daily net assets.
U.S. Trust Company, N.A. ("U.S. Trust, N.A.") serves as the investment
adviser to the Balanced Fund and until December 28, 1998, International Equity
Fund. U.S. Trust, N.A. has delegated the daily management of the security
holdings of the Balanced Fund to Becker Capital Management, Inc., acting as
sub-adviser and until December 28, 1998, Harding, Loevner Management, L.P. acted
as sub-adviser to the International Equity Fund.
<PAGE>
For the services provided pursuant to the Investment Advisory Agreement, U.S.
Trust, N.A. is entitled to receive a fee, computed daily and paid monthly, at
the annual rate of 0.65% of the average daily net assets of the Balanced Fund,
and until December 28, 1998, 1.00% of the average daily net assets of the
International Equity Fund. Pursuant to separate sub-advisory agreements between
U.S. Trust, N.A. and each sub-adviser, sub-advisory fees are payable monthly by
U.S. Trust, N.A., computed on the average daily value of each Fund's net assets
at the following annual rates: 0.425% for the Balanced Fund, and until December
28, 1998, 0.50% for the International Equity Fund. The sub-advisers are
compensated only by U.S. Trust, N.A., and receive no fee directly from the
Funds. Prior to June 22, 1998, United States Trust Company of The Pacific
Northwest served as the investment adviser to the Balanced Fund and
International Equity Fund pursuant to investment advisory agreements
substantially similar to those currently in effect for Balanced Fund and
International Equity Fund. In addition, prior to December 28, 1998, U.S. Trust,
N.A. served as the investment adviser to the International Equity Fund pursuant
to an investment advisory agreement substantially similar to that currently in
effect for the International Equity Fund.
U.S. Trust NY, U.S. Trust CT and U.S. Trust, N.A. are wholly-owned
subsidiaries of U.S. Trust Corporation, a registered bank holding company.
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements -- (Continued)
b) U.S. Trust CT, Chase Global Funds Services Company, a corporate
affiliate of The Chase Manhattan Bank, and Federated Administrative Services, a
wholly-owned subsidiary of Federated Investors, Inc., (collectively, the
"Administrators") provide administrative services to the Trust. For the
services provided to the Funds, the Administrators are entitled jointly to
annual fees, computed daily and paid monthly, based on the combined aggregate
average daily net assets of the Funds (excluding International Equity Fund),
Excelsior Funds, Inc. (excluding its international equity portfolios), and
Excelsior Tax-Exempt Funds, Inc., all of which are affiliated investment
companies, as follows: 0.200% of the first $200 million, 0.175% of the next
$200 million, and 0.150% over $400 million. Administration fees payable by each
Fund of the three investment companies are determined in proportion to the
relative average daily net assets of the respective Funds for the period paid.
The Administrators are entitled jointly to annual fees, computed daily and paid
monthly, based on the average daily net assets of the International Equity Fund
at an annual rate of 0.20%. For the year ended March 31, 1999, administration
fees charged by U.S. Trust CT were as follows:
Equity Fund ................................................. $56,536
Income Fund ................................................. $23,656
Total Return Bond Fund ...................................... $75,381
Balanced Fund ............................................... $24,114
International Equity Fund ................................... $35,741
Optimum Growth Fund ......................................... $26,583
Value Equity Fund ........................................... $12,977
c) From time to time, as they may deem appropriate in their sole
discretion, U.S. Trust, U.S. Trust, N.A. and the Administrators may undertake
to waive a portion or all of the fees payable to them and also may reimburse
the Funds for a portion of other operating expenses. Until further notice, U.S.
Trust and U.S. Trust, N.A. have agreed to voluntarily waive fees and reimburse
expenses to the extent necessary to maintain an annual operating expense ratio
of not more than: 0.50% of average daily net assets of the Income Fund and
Total Return Bond Fund; 0.70% of average daily net assets of the Equity Fund
and the Institutional Shares of the Balanced Fund, and until March 8, 1999,
0.70% of average daily net assets of the Institutional Shares of the Optimum
Growth Fund and the Value Equity Fund; 0.90% of average daily net assets of the
Institutional Shares of the International Equity Fund; and 1.05% of average
daily net assets of the Shares of the Balanced Fund, Optimum Growth Fund and
Value Equity Fund. Effective March 8, 1999, U.S. Trust has agreed to
voluntarily waive fees and reimburse expenses to the extent necessary to
maintain an annual operating expense ratio of not more than 0.80% of average
daily net assets of the Institutional Shares of the Optimum Growth Fund and the
Value Equity Fund. For the year ended March 31, 1999, U.S. Trust voluntarily
waived fees in the following amounts:
Equity Fund ................................................. $298,579
Income Fund ................................................. $262,853
Total Return Bond Fund ...................................... $781,974
Balanced Fund ............................................... $175,998
International Equity Fund ................................... $263,217
Optimum Growth Fund ......................................... $155,809
Value Equity Fund ........................................... $ 91,255
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements -- (Continued)
d) The Trust, on behalf of the Funds, may enter into administrative
servicing agreements with various service organizations (which may include
affiliates of U.S. Trust) requiring them to provide administrative support
services to their customers owning shares of the Funds. As a consideration for
the administrative services provided by each service organization to its
customers, each Fund will pay the service organizations an administrative
service fee at the annual rate of up to 0.40% of the average daily net asset
value of its shares held by the service organization's customers. Such services
may include assisting in processing purchase, exchange or redemption requests;
transmitting and receiving funds in connection with customer orders to
purchase, exchange or redeem shares; and providing periodic statements. U.S.
Trust, U.S. Trust, N.A. and the Administrators intend to voluntarily waive
investment advisory and administration fees payable by each Fund in an amount
equal to the administrative service fees payable by such Fund. For the year
ended March 31, 1999, no administrative service fees have been charged to the
Funds.
e) Pursuant to a Distribution Agreement, Edgewood Services, Inc. (the
"Distributor") serves as the Trust's distributor. Under the Funds' Distribution
Plan, adopted pursuant to Rule 12b-1 under the Act, the Shares of the Balanced
Fund, International Equity Fund, Optimum Growth Fund and Value Equity Fund may
compensate the Distributor monthly for its services which are intended to
result in the sale of Shares, in an amount not to exceed the annual rate of
0.75% of the average daily net asset value of each Fund's outstanding Shares.
With regard to the Balanced Fund and the International Equity Fund, Shares
currently bear the expense of such distribution fees at the annual rate of
0.35% of the average daily net asset value of the Fund's outstanding Shares.
With regard to the Optimum Growth Fund and the Value Equity Fund, effective
March 8, 1999, Shares bear the expense of such distribution fees at the annual
rate of 0.25% of the average daily net asset value of the Fund's outstanding
Shares. Prior to March 8, 1999, Shares of the Optimum Growth Fund and the Value
Equity Fund bore the expense of such distribution fees at the annual rate of
0.35% of the average daily net asset value of the Fund's outstanding Shares.
f) Trustees receive an annual fee of $4,000, plus a meeting fee of $250
for each meeting attended. In addition, the Trust reimburses independent
Trustees for reasonable expenses incurred when acting in their capacity as
Trustees.
3. Purchases and Sales of Investment Securities:
a) Investment transactions (excluding short-term investments) for the year
ended March 31, 1999 were as follows:
Cost of Proceeds
Purchases From Sales
------------ ------------
Equity Fund ....................... $ 69,670,626 $ 54,629,784
Income Fund ....................... $126,650,268 $118,690,667
Total Return Bond Fund ............ $519,763,707 $447,382,295
Balanced Fund ..................... $ 27,363,765 $ 74,814,594
International Equity Fund ......... $ 82,383,476 $ 39,009,889
Optimum Growth Fund ............... $ 16,608,455 $ 15,744,552
Value Equity Fund ................. $ 22,683,489 $ 19,361,891
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements -- (Continued)
b) Investment transactions in U.S. Government and Agency Obligations
(excluding short-term investments) for the year ended March 31, 1999 were as
follows:
Cost of Proceeds
Purchases From Sales
-------------- --------------
Equity Fund ....................... -- --
Income Fund ....................... $ 72,749,725 $ 65,819,947
Total Return Bond Fund ............ $354,197,728 $305,265,122
Balanced Fund ..................... $ 6,139,399 $ 14,141,104
International Equity Fund ......... -- --
Optimum Growth Fund ............... -- --
Value Equity Fund ................. -- --
4. Line of Credit:
The Portfolios and other affiliated funds participate in a $250 million
unsecured line of credit provided by a syndication of banks under a line of
credit agreement. Borrowings may be made to temporarily finance the repurchase
of Portfolio shares. Interest is charged to each Portfolio, based on its
borrowings, at a rate equal to the Federal Funds Rate plus 2% per year. In
addition, a commitment fee, based on the average daily unused portion of the
line of credit, is allocated among the participating Portfolios at the end of
each quarter. For the year ended March 31, 1999, the Portfolios had no
borrowings under the agreement.
5. Year 2000 Risk (Unaudited):
Like other investment companies, financial and business organizations and
individuals around the world, the Funds could be affected adversely if the
computer systems used by the investment managers and the Funds' other service
providers do not properly process and calculate date-related information and
data from and after January 1, 2000. This is commonly known as the "Year 2000
Problem." The investment managers and the Funds' other service providers have
informed the Trust that they are taking steps to address the Year 2000 Problem
with respect to the computer systems that they use. Currently, they do not
anticipate that the transition to the 21st Century will have any material
impact on their ability to continue to service the Funds at current levels. At
this time, however, there can be no assurance that their efforts will be
sufficient to avoid any adverse impact on the Funds as a result of the Year
2000 Problem.
<PAGE>
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
To the Shareholders and Board of Trustees
Excelsior Institutional Trust
We have audited the accompanying statements of assets and liabilities,
including the schedules of investments, of the Excelsior Institutional Trust
(the "Trust") (comprising, respectively, the Excelsior Equity, Excelsior
Income, Excelsior Total Return Bond, Excelsior Balanced, Excelsior
International Equity, Excelsior Optimum Growth and Excelsior Value Equity
Funds) as of March 31, 1999, and the related statements of operations for the
year then ended, the statements of changes in net assets and the financial
highlights for each of the periods indicated therein. 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
March 31, 1999 by correspondence with the custodian and brokers or other
appropriate auditing procedures where replies from brokers were not received.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
the Excelsior Equity, Excelsior Income, Excelsior Total Return Bond, Excelsior
Balanced, Excelsior International Equity, Excelsior Optimum Growth and
Excelsior Value Equity Funds at March 31, 1999, the results of their operations
for the year then ended and the changes in their net assets and the financial
highlights for each of the periods indicated therein, in conformity with
generally accepted accounting principles.
Ernst & Young LLP
Boston, Massachusetts
May 7, 1999
<PAGE>
Federal Tax Information (Unaudited):
For the year ended March 31, 1999, the percentage of dividends paid that
qualify for the 70% dividends received deduction for corporate shareholders,
the designation of long-term capital gains, the amounts expected to be passed
through to shareholders as foreign tax credits and the percentage of income
earned from direct Treasury obligations are approximated as follows:
<TABLE>
<CAPTION>
Dividends 20%
Received Long-Term Foreign Tax Treasury
Fund Deduction Capital Gain Credit Income
- ----------------------------------- ----------- -------------- ------------- ---------
<S> <C> <C> <C> <C>
Equity Fund ....................... 83% $2,446,000 -- --
Income Fund ....................... -- 700,000 -- 28%
Total Return Bond Fund ............ -- 3,267,000 -- 44%
Balanced Fund ..................... 23% 3,580,000 -- 33%
International Equity Fund ......... -- 1,722,000 $83,000 --
Optimum Growth Fund ............... 100% 4,000 -- --
Value Equity Fund ................. 48% 2,315,000 -- --
</TABLE>
In addition, for the year ended March 31, 1999, gross income derived from
sources within foreign countries for the International Equity Fund
approximately amounted to $845,000.
<PAGE>
Voting Results of Special Meeting of Shareholders (Unaudited):
The proposal described below was submitted to a vote of shareholders of
the International Equity Fund (the "Fund") of the Trust at a special meeting of
shareholders held on December 28, 1998 (the "Meeting").
Proposal -- Approval of a new investment advisory agreement for the Fund
among the Trust, United States Trust Company of New York and U.S. Trust Company
of Connecticut.
At the Meeting, the shareholders of the Fund approved the Proposal as
follows:
For Abstain Against
--- ------- -------
2,589,602 -- 28,490
