<PAGE>
Investment Advisers
United States Trust Company of New York
114 West 47th Street
New York, NY 10036
U.S. Trust Company
225 High Ridge Road
Stamford, CT 06905
Transfer Agent
Chase Global Funds Services Company
73 Tremont Street
Boston, MA 02108
(800) 446-1012
Distributor
Edgewood Services, Inc.
5800 Corporate Drive
Pittsburgh, PA 15237
SHARES OF THE FUNDS ARE NOT DE-
POSITS OR OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED BY, ANY
BANK, AND THE SHARES ARE NOT FED-
ERALLY INSURED BY THE FEDERAL DE-
POSIT 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 A00
[LOGO OF EXCELSIOR FUNDS]
Institutional Shares
Equity Fund
Income Fund
Total Return Bond Fund
International Equity Fund
Optimum Growth Fund
Value Equity Fund
Annual Report
March 31, 2000
<PAGE>
LETTER TO SHAREHOLDERS
--------------------------------------------------------------------------------
Dear Shareholder:
The fiscal year ended March 31, 2000 was exciting and rewarding both
domestically and abroad. In the U.S. and around the world, preparations for
"Y2K" and millennium celebrations consumed everyone's thoughts. The U.S.
economy was in the midst of an extraordinary expansion. Simultaneously, Europe
prepared for and converted to a new central currency, the Euro. Meanwhile, Asia
rebounded from fiscal turmoil in several key markets in early 1999.
All the major domestic equity indices exhibited strong performance. As the
fiscal year ended, the breadth of performance extended from the familiar large-
capitalization stocks to the mid-sized and small-cap stocks. Technology stocks
led all market sectors to new highs. This occurred, despite several interest
rate hikes by the Federal Reserve Board. The rising interest rate environment
and continued economic expansion seemed to temper only the performance of the
fixed-income markets.
Given the continued rate of expansion of the U.S. economy, we believe
interest rate increases are inevitable. This environment will make the coming
year a challenging one in the financial markets. We are confident that the
broad array of domestic and international equity as well as taxable and tax-
exempt fixed-income funds will help you meet your financial objectives.
On May 31, 2000, U.S. Trust Corporation, parent of the advisers to the
Excelsior Fund family ("U.S. Trust"), merged with a subsidiary of The Charles
Schwab Corporation. Earlier in the month, shareholders of the Excelsior Funds
approved new advisory contracts that will enable U.S. Trust to remain as the
investment adviser to the Excelsior Funds after the merger. We look forward to
participating in the benefits which the merger of such outstanding
organizations may bring to Excelsior Funds.
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, 2000, global financial market
performance was mixed. In the U.S., despite some volatility, the equity
markets posted another year of well-above-average gains. International equity
markets overall saw strong gains as well. Asian markets continued their
dramatic recovery, though they gave up some ground in the final quarter.
Europe overall proved somewhat sluggish at the start of the year but picked up
markedly in the second half. Latin America, also, began the year in
uncertainty but strengthened in the second half. Domestic fixed-income markets
saw extremely challenging conditions through the first three quarters, though
the fiscal fourth quarter saw a strong market rally -- though not across the
board.
Domestic Equity Markets
The fiscal year began on a positive note, with news that the economy was
continuing to grow strongly with little signs of inflation. In the first week
of April, the high-tech sector drove the market higher. The tech-heavy NASDAQ
Composite Index rose to a record high for the first time in two months. And
the Dow Jones Industrial Average climbed over the 10,000 mark on April 7,
aided by strong gains from the financial stocks. Small caps continued to under
perform the broader market.
The environment changed dramatically, however, in the second week of April.
Investors abandoned the small number of growth stocks that had been driving
the market for so long -- especially technology-- and poured into beaten-down
but economically sensitive cyclical issues and even the long-suffering mid-
and small-cap stocks. Part of the catalyst seemed related to the view that the
world economy would grow faster than expected. Part may also have been related
to valuation issues as well as mounting fears regarding the sustainability of
earnings growth. The broadening trend continued in May and June, though with
some volatility. The pummeled Internet stocks began to show signs of recovery
in the latter half of June. In mid-June, both the equity and fixed-income
markets responded positively to Federal Reserve Chairman Alan Greenspan's
comments that suggested that the Fed would not raise rates aggressively. This
did in fact occur on the final day of the quarter.
The second quarter began on an encouraging note, rallying on the heels of
the rate hike and adoption of a neutral bias. This, along with optimism about
corporate profits, pushed the major indices to new highs in the first week of
the quarter. The stock market environment quickly grew more mixed thereafter,
though computer and tech stocks did manage to push the NASDAQ to record-high
territory by mid-month, August was mixed, as the broadening trend that began
in April seemed to run out of steam. The recovering cyclicals faded, growth
stocks trounced value stocks, big caps regained leadership versus small caps,
and technology rebounded. These trends held sway through September.
The third quarter, however, was remarkably strong for domestic equities.
Financial stocks, for instance, were given a boost at the end of October when
Congress agreed to repeal portions of the Glass-Steagall Act. Heading into
November, the NASDAQ Composite Index continued to be the real story, posting
consecutive highs through calendar year end. Also noteworthy, small-cap stocks
-- paced by Internet stocks -- rebounded strongly in the quarter.
The fourth fiscal quarter, however, was decidedly bumpy. Concerns regarding
inflation, interest rates, and valuation levels fed speculation that the
market might rotate out of technology into the value areas of the market. In
fact, in the first days of January, the technology heavy NASDAQ Composite
Index declined, while health care, energy and financials showed signs of life.
But -- in a pattern that would
<PAGE>
repeat itself over and over again in the quarter -- the "rotation" didn't
last. Technology came roaring back. Internet, semiconductors, fiber optics,
biotechnology, and small-cap stocks all saw strong gains. The same pattern
held in February. The start of March saw the DJIA regain some lost ground. In
the quarter's final weeks, both the DJIA and S&P 500 showed renewed strength,
while the NASDAQ and Russell 2000 Index of small company stocks faltered and
then recovered.
International Equity Markets
In the first fiscal quarter, international markets rose moderately. The
weakest region was Europe, specifically the UK, whereas Emerging Asia was the
strongest, followed by Latin America and Japan. One of the major surprises in
the period was the weakness of the Euro, due to 1) The shifting of assets by
investors from Europe to Asia. Many so-called "global and international"
managers were almost entirely invested in Europe at calendar year end and were
unprepared for Asia's sharp recovery; 2) the predecessor currencies had
strengthened significantly before the Euro was introduced; 3) the surprising
strength of the US economy and therefore the US dollar caused Euro weakness by
default; and 4) the core European economies bore the brunt of export weakness
in response to last year's emerging markets crises.
Meanwhile, the Asian economies were recovering strongly, as corporate
restructuring began to be embraced in Japan and throughout Emerging Asia,
boosting earnings growth.
The international markets picked up in the second fiscal quarter. A weaker
US dollar helped returns, especially in Japan, the best performer among
developed markets during the quarter, after two consecutive quarters of
positive GDP growth. As a result, Asia Pacific did well in spite of South East
Asia falling victim to profit taking after its strong run. Similarly Latin
America was the weakest region globally, after a strong run in the prior two
quarters. Europe was the laggard amongst the regions.
The third quarter saw a powerful rally for the world's equity markets --
representing the first time since 1994 that international equities
outperformed the U.S. market. Europe and Latin America picked up markedly in
the quarter, but the performance driver was clearly Asia. In Europe, Finland
and Sweden led the pack with their high concentration in telecommunications
stock. The Y2K issue turned out to be a non-event, even in the least developed
parts of the world.
The fiscal fourth quarter began on a mixed note with no clear regional
direction and an overwhelming differentiation of "old economy" versus "new
economy" companies. The period experienced tremendous volatility and rapid
sector rotation. The world's developed markets were down a small fraction.
Canada and the emerging markets led performance, while there was no clear
regional leadership as seen by Europe, Asia, and Latin America -- each of
which posted moderate gains in the period.
Fixed Income Markets
The fixed-income markets struggled during the first three quarters of the
fiscal year. At the outset of the year, the bond market came under increasing
pressure in the second quarter, as inflation fears drove the yield on the long
bond to over 6.0%.
Continued signs of strength in the U.S. economy, rising oil prices, and an
improving global outlook fueled investor concerns about rising inflation and
led the Fed to announce a bias toward tightening monetary policy in May.
However, solid evidence of inflation remained elusive. True to its
indications, the Fed did in fact raise the federal funds rate by 25 basis
points at the end of June, and signaled a return to a neutral bias.
<PAGE>
The challenging conditions persisted unabated in the second quarter. In the
period, the Treasury curve moved barely at all. In many ways, the quarter was
marked by uncertainty -- about interest rates, inflation, and economic growth.
Economic growth proved to be relatively low in the first fiscal quarter, but
stronger growth was expected in the second. Inflation concerns were propelled
by higher oil prices, strong employment and some glimpses of wage pressure.
Still, however, Producer Price Index and Consumer Price Index numbers remained
moderate in the period, but eventually data published in a National Association
of Purchasing Managers survey spooked the market. On the interest-rate front,
everyone believed that the Fed was on hold after the June increase -- at least
until its rate hike and return to a tightening bias late in the quarter.
Municipal securities had a poor quarter as well, as the market showed disdain
for longer-maturity securities in particular.
Corporate, mortgage, asset-backed and government agency securities' yield to
Treasury spreads were volatile as well. This was the result of unusually large
issuance in the second quarter driven by concerns that liquidity would dry up
at calendar year end on Y2K fears.
The third quarter only saw more of the same challenges. Interest rates rose
across the board, though taxables rose more than municipal securities.
The fourth quarter, however, saw the fixed-income markets rally strongly --
though not across the board. While yields moved up at the short end of the
Treasury yield curve, 5-year Treasuries were basically flat, 10-year issues
were down, and the long bond declined.
Still, the quarter began with yield increases for all maturities due to
persistent concerns about economic growth and fear of additional Federal
Reserve interest-rate hikes. In February, however, the government announced a
$30 billion Treasury buyback, which ignited a rally -- though mostly at the
long end. When the Fed increased rates again in March, the market seemed to
take it as a sign that rate hikes were at (or nearing) an end, and the rally
continued.
Much the same was true for municipal securities, though as usual they lagged
Treasuries. There wasn't much demand for long munis in the period, but a
decline in supply kept the market in decent shape.
On the taxable side, spreads widended through the first half of the quarter.
Momentum picked up toward quarter end due to the announced Treasury buyback as
well as news of possible limits on Treasury backing of the Government Sponsored
Enterprises (FNMA, FHLMC, SLMA, FHLB, FFCB, and TVA).
<PAGE>
ADVISOR'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST EQUITY FUND
--------------------------------------------------------------------------------
For the twelve months ended March 31, 2000, the Fund realized a total return
of 25.75%*, versus 17.95%** for the Standard & Poor's 500 Composite Stock Price
Index and for the same period ranked 103 out of 424 funds, based on total
return, in the Lipper Large-Cap Core category.*** The Fund ranked 63 out of 141
funds in the same Lipper category for the five years ended March 31, 2000, with
a cumulative total return of 211.53%.* Our investment strategy remained
consistent; 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. Through much
of the fiscal year, until well into the fiscal fourth quarter, technology was
by far the best-performing sector of the market. Many technology companies were
experiencing strong growth as spending on all types of information and
communication technology grew due to the burgeoning Internet and the need to
reduce costs and improve productivity. Strong technology performers within the
Fund included Cisco Systems, Sun Microsystems, EMC, Microsoft, Nokia and Texas
Instruments, as well as Yahoo and America Online in the Internet space. The
Fund's financial stocks performed very well on a relative basis, despite the
substantial increase in long-term interest rates. Financial leaders were Morgan
Stanley Dean Witter, Citigroup and American International Group. Other strong
performers included CBS, Liberty Media, and Home Depot in the consumer
category, General Electric and Honeywell in capital goods and Nextel and
General Motors Class H in communications. Gillette and Coca-Cola showed
considerable weakness within the consumer staple group. Drug stocks were also
weak, due in part to concerns about potential legislation/regulation.
[GRAPH]
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Equity Fund+
----------------------------------------------
Average Annual Total Return
Ended on 3/31/00*
----------------------------------------------
1 year 5 years Since Inception (1/16/95)
----------------------------------------------
25.75% 25.52% 25.59%
----------------------------------------------
Standard & Poor's
500 Composite Stock
Price Index** Equity Fund
1/24/95 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
3/31/00 35,892 32,730
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.
*** 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>
ADVISOR'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST INCOME FUND
--------------------------------------------------------------------------------
For the twelve months ended March 31, 2000, the Fund realized a total return
of 1.16%* versus 2.07%** for the Lehman Brothers Intermediate Govt/Corp Bond
Index and for the same period ranked 42 out of 171 funds, based on total
return, in the Lipper Corporate Debt A-Rated category.*** The Fund ranked 48
out of 110 funds in the same Lipper category for the five years ended March 31,
2000, with a cumulative total return of 36.11%.* Through the first three fiscal
quarters, the Fund benefited from an overexposure to commercial mortgage and
asset backed securities while an underweight in lower investment grade
securities was a drag on performance. Heading into the final fiscal quarter,
the Fund continued to benefit from its concentration in higher-quality bonds.
The Funds overweight position in high-quality asset-backed securities,
commercial mortgages, and Ginnie Mae securities caused it to outperform
underweighted lower-grade corporates and Government agency securities. An
overweight position in Ginnie Mae securities relative to Fannie Mae's and a
bias for yield curve flattening also benefited the Fund. Higher-quality bonds
outperformed lower-quality bonds due to a reduction in the supply of U.S.
Treasury securities, stock market volatility, and Federal Reserve tightening.
From a credit perspective we continue to overweight higher quality spread
products until we feel lower quality bonds pay enough to compensate investors
for the additional risk.
[GRAPH]
----------------------------------------------
Income Fund+
----------------------------------------------
Average Annual Total Return
Ended on 3/31/00*
----------------------------------------------
1 year 5 years Since Inception (1/16/95)
----------------------------------------------
1.16% 6.33% 6.68%
----------------------------------------------
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
3/31/00 14,295 14,005
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>
ADVISOR'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST TOTAL RETURN BOND FUND
--------------------------------------------------------------------------------
For the twelve months ended March 31, 2000, the Fund realized a total return
of 1.47%* versus 1.68%** for the Lehman Brothers Govt/Corp Bond Index and for
the same period ranked 25 out of 171 funds, based on total return, in the
Lipper Corporate Debt A-Rated category.*** The Fund's long-term performance has
been excellent as well, ranking 15 out of 110 funds, in the same Lipper
category for the five years ended March 31, 2000, with a cumulative total
return of 40.64%.* In the first fiscal quarter, fixed income spread products
widened due to heavy corporate bond supply and Federal Reserve tightening. The
Fund was hurt by an overexposure to mortgage and asset backed securities during
this period. The Fund also lagged with a slightly longer duration than the
market as interest rates rose for intermediate maturities. Duration is a
measure of a security's price sensitivity to changes in interest rates.
Securities with longer durations are more sensitive to changes in interest
rates than securities of shorter durations. We elected to maintain an
overweight in this type of high-quality spread product that had provided a
generous yield pickup relative to Treasuries. In the second and third fiscal
quarters, Fund performance picked up thanks to the addition of mortgage and
asset backed securities, on spread widening, and favorable yield curve
positioning. Given interest-rate uncertainty, we kept the duration close to the
benchmark, waiting to extend until it appeared the Fed was approaching the end
of its tightening cycle. In the fiscal fourth quarter, the Fund continued to
benefit from its emphasis on higher-quality bonds. Overweights in high-quality
asset-backed securities, commercial mortgages, and Ginnie Mae securities
outperformed underweighted lower-grade corporates and Government agency
securities. This out performance was due to a reduction in supply of Treasury
securities, stock market volatility, and Federal Reserve tightening. From a
credit perspective we will continue to overweight higher quality spread
products until we feel lower quality bonds pay enough yield to compensate
investors for the additional risk.
[GRAPH]
----------------------------------------------
Total Return Bond Fund+
----------------------------------------------
Average Annual Total Return
Ended on 3/31/00*
----------------------------------------------
1 year 5 years Since Inception (1/19/95)
----------------------------------------------
1.47% 7.03% 7.40%
----------------------------------------------
Lehman Brothers Total Return
Govt/Corp. Bond Index** 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
3/31/00 14,866 14,494
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>
ADVISOR'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST INTERNATIONAL EQUITY FUND
--------------------------------------------------------------------------------
For the twelve months ended March 31, 2000, the Fund realized a total return
of 64.29%,* strongly outpacing the FT/S&P-Actuaries World Indices-World
Excluding U.S. Index's return of 27.80%** and ranked 68 out of the 643 funds,
based on total return, in the Lipper International Funds category*** for the
same period. The Fund also performed well long term, ranking 71 out of 254
funds in the same Lipper category for the five years ended March 31, 2000, with
a cumulative total return of 118.15%.* The Fund began the year on a positive
note, thanks to several strong holdings (Datacraft, Nintendo, Don Quijote) and
in spite of an absence of cyclical stocks in the portfolio. Having added
several Asian stocks to the Fund early in the year, the resulting underweight
in Europe and overweight in Asia Pacific also helped. Our European technology
and telecom stocks also contributed strongly to performance. The same can be
said of the fiscal second quarter. Most of the year's gains, however, came in
the fiscal third quarter. This was driven in part by powerful market rallies,
but also by stock selection. A few Japanese stocks performed particularly well,
e.g. Furukawa Electric, NTT Data and Sony. Some European winners were Ericsson,
STMicroelectronics and Mannesmann. The fiscal fourth quarter saw performance
drop off considerably. The new millennium started on a mixed note with no clear
regional direction and an overwhelming differentiation of "old economy" versus
"new economy" companies. The quarter experienced tremendous volatility and
rapid sector rotation. Fund performance was aided by our continued focus on
stock selection, long-term investment horizon and portfolio diversification.
[GRAPH]
----------------------------------------------
International Equity Fund+
----------------------------------------------
Average Annual Total Return
Ended on 3/31/00*
----------------------------------------------
1 year 5 years Since Inception (1/24/95)
----------------------------------------------
64.29% 16.89% 17.10%
----------------------------------------------
FT/S&P-Actuaries
World Indices--World International
Excluding U.S. Index** 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
3/31/00 17,999 22,667
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.
*** 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>
ADVISOR'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST OPTIMUM GROWTH FUND
--------------------------------------------------------------------------------
For the twelve months ended March 31, 2000, the Fund realized a total return
of 27.66%* versus 34.11%** for the Russell 1000 Growth Index. As always, we
continued to focus exclusively on high-quality, large-cap companies that we
believe have superior growth potential. We concentrate the Fund in roughly 25
names and we don't concern ourselves with issues of market timing and
valuation. Our policy is to let the winners run and to eliminate the losers
and/or those companies whose fundamental earnings outlook deteriorates for what
we expect will be a sustained period of time. As a result, the Fund's largest
holdings are generally its best performing as well. The Fund's top holdings, as
of fiscal year end, included EMC, America Online, Intel, Home Depot, Dell
Computer, Nokia, Microsoft, Medtronic, and Sun Microsystems. In addition, a
structured overlay, representing 30% of Fund assets, consists of a
complimentary basket of stocks selected from the Russell 1000 growth stocks.
The overlay is designed to increase diversification and reduce volatility
without materially inhibiting return potential. Throughout the year, the Fund's
technology companies continued to be important contributions to performance.
Among these, we would highlight BMC Software, Nokia, Sun Microsystems, America
Online, and JDS Uniphase. We feel our holdings have strong balance sheets and
use less debt financing than the average company, and continue to benefit from
several powerful trends: accelerating Internet activity, the proliferation of
wireless communication, increasing globalization of the financial markets, and
the trend toward outsourcing of non-mission-critical business activities. We
continue to focus on making long-term commitments to leading companies in fast-
growing industries.
[GRAPH]
----------------------------------------------
Optimum Growth Fund+
----------------------------------------------
Average Annual Total Return
Ended on 3/31/00*
----------------------------------------------
1 year Since Inception (6/1/96)
----------------------------------------------
27.66% 39.09%
----------------------------------------------
Optimum Growth Russell 1000
Fund Growth Index**
6/1/96 10,000 10,000
9/30/96 10,004 10,374
3/31/97 10,223 11,059
9/30/97 13,423 14,139
3/31/98 16,444 16,528
9/30/98 16,851 15,701
3/31/99 27,749 21,166
9/30/99 26,700 21,174
3/31/00 35,424 28,386
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. 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: The Russell Company -- The Russell 1000 Growth Index 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>
ADVISOR'S INVESTMENT REVIEW
EXCELSIOR INSTITUTIONAL TRUST VALUE EQUITY FUND
--------------------------------------------------------------------------------
For the twelve months ended March 31, 2000, the Fund realized a total return
of 41.92%,* exceeding the Russell 1000 Value Index's return of 6.33%,** and
ranked 60 out of 372 funds, based on total return, in the Lipper Multi-Cap Core
Funds category*** for the same period. The fiscal year began strongly for the
Fund. We made few alterations to the portfolio; as always, the Fund remained
broadly diversified, and consequently benefited from the broadening of the
market that we had been anticipating, specifically the better relative
performance of value vs. growth. That said, several of the Fund's more growth-
oriented names continued to do well, particularly those in the technology and
transportation areas. Conditions grew more challenging in the fiscal second
quarter, however. The largest factor impacting Fund performance was the
screeching stop to the value stocks' recovery. The portfolio's technology
holdings did manage to dampen the negative impact somewhat, however. The Fund's
largest individual holdings include Nokia, Global Crossing, IBM, Texas
Instruments, Bristol Myers, AT&T, and Liberty Media. These were also among the
Fund's best performers in the quarter. Once again, at least in the third
quarter, technology was the principal performance driver -- in particular our
long-held positions in Nokia (the Fund's largest position) and IBM. Other
strong gains were seen in the Fund's small positions in Akamai Technologies,
Bluestone Software, and Broadbase Software. Financials, which had been such an
aid to the fund in 1998, were an overall drag on performance. In the final
quarter, however, the Fund began to see improved performance from some of the
more value-oriented and rate-sensitive holdings (Ford, GM, Centex, and the
financials). Comfortable with its basic structure, we made few changes to the
Fund during the quarter. We did take some profits in some technology holdings
that had performed exceptionally well.
[GRAPH]
----------------------------------------------
Value Equity Fund+
----------------------------------------------
Average Annual Total Return
Ended on 3/31/00*
----------------------------------------------
1 year Since Inception (6/1/96)
----------------------------------------------
41.92% 27.92%
----------------------------------------------
Russell 1000
Value Equity Fund Value Index**
6/1/96 10,000 10,000
9/30/96 10,261 10,299
3/31/97 11,391 11,617
9/30/97 15,397 14,657
3/31/98 17,030 17,096
9/30/98 14,364 15,183
3/31/99 18,105 17,958
9/30/99 18,911 18,024
3/31/00 25,695 19,095
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. 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: 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.
*** 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>
Excelsior Institutional Trust
Schedule of Investments
March 31, 2000
Equity Fund
<TABLE>
<CAPTION>
Shares Value
---------- ------------
<C> <S> <C>
COMMON STOCKS -- 98.54%
CAPITAL GOODS -- 7.83%
18,631 Ford Motor Co. ...................................... $ 855,861
59,766 General Electric Co. ................................ 9,274,936
55,303 Illinois Tool Works, Inc. ........................... 3,055,491
800 +Silicon Laboratories, Inc. ......................... 70,800
20,746 Texas Instruments, Inc. ............................. 3,319,360
------------
16,576,448
------------
CONSUMER CYCLICAL -- 23.10%
3,789 +Amazon.com, Inc. ................................... 253,626
42,411 +AT&T Corp. ......................................... 2,512,852
50,663 Bristol-Meyers Squibb Co. ........................... 2,925,788
4,466 +Brocade Communications Systems, Inc. ............... 799,414
74,773 +CBS Corp. .......................................... 4,234,021
2,445 +Commerce One, Inc. ................................. 364,916
1,919 +eBay, Inc. ......................................... 337,624
450 +Foundry Networks, Inc. ............................. 62,803
17,781 +General Motors Corp., Class H....................... 2,213,735
58,186 Home Depot, Inc. .................................... 3,752,997
35,202 Honeywell International, Inc. ....................... 1,854,705
76,505 McDonald's Corp. .................................... 2,873,719
40,661 Medtronic, Inc. ..................................... 2,091,500
41,393 Merck & Co., Inc. ................................... 2,571,540
140,682 Pfizer, Inc. ........................................ 5,143,686
54,964 Schering-Plough Corp. ............................... 2,019,927
99,400 Time Warner, Inc. ................................... 9,940,000
87,641 Wal-Mart Stores, Inc. ............................... 4,864,076
200 +Webmethods, Inc. ................................... 48,225
200 +724 Solutions, Inc. ................................ 24,600
------------
48,889,754
------------
CONSUMER STAPLE -- 6.32%
65,358 Bestfoods............................................ 3,059,571
55,720 Coca-Cola Co. ....................................... 2,615,358
82,735 Gillette Co., Class H................................ 3,118,075
4,925 +Human Genome Sciences, Inc. ........................ 408,775
26,252 Johnson & Johnson Co. ............................... 1,839,281
41,472 Procter & Gamble Co. ................................ 2,332,800
------------
13,373,860
------------
ENERGY -- 5.31%
53,242 BP Amoco plc ADR..................................... 2,825,154
7,481 Enron Corp. ......................................... 560,140
</TABLE>
<TABLE>
<CAPTION>
Shares Value
---------- ------------
<C> <S> <C>
COMMON STOCKS -- (continued)
ENERGY -- (continued)
52,967 Exxon Mobil Corp. ................................... $ 4,121,495
64,746 Royal Dutch Petroleum Co. ........................... 3,726,941
------------
11,233,730
------------
FINANCIAL -- 12.84%
53,600 American International Group, Inc., Class A.......... 5,869,200
45,186 Associates First Capital Corp. ...................... 968,675
27,951 Capital One Financial Corp. ......................... 1,339,901
76,658 Citigroup, Inc. ..................................... 4,546,778
62,671 Firstar Corp. ....................................... 1,437,516
26,470 Household International, Inc. ....................... 987,662
101,960 Mellon Financial Corp. .............................. 3,007,820
65,828 Morgan Stanley Dean Witter &
Co. ................................................ 5,369,096
89,291 Wells Fargo Co. ..................................... 3,655,350
------------
27,181,998
------------
MANUFACTURING -- 0.33%
600 +Avanex Corp. ....................................... 91,050
4,978 +JDS Uniphase Corp. ................................. 599,849
------------
690,899
------------
TECHNOLOGY -- 41.17%
400 +Akamai Technologies, Inc. .......................... 64,300
39,464 +America Online, Inc. ............................... 2,653,954
9,096 +Amgen, Inc. ........................................ 557,699
2,049 +Ariba, Inc. ........................................ 429,137
1,250 +ArrowPoint Communications, Inc. .................... 148,047
20,864 Bell Atlantic Corp. ................................. 1,275,312
1,500 +BreezeCom Ltd. ..................................... 55,500
6,954 +BroadVision, Inc. .................................. 313,799
200,858 +Cisco Systems, Inc. ................................ 15,528,834
32,528 +EMC Corp. .......................................... 4,066,000
4,925 +Genentech, Inc. .................................... 748,600
3,494 +Inktomi Corp. ...................................... 681,112
80,721 Intel Corp. ......................................... 10,640,037
32,971 International Business Machines Corp. ............... 3,890,578
38,530 Lucent Technologies, Inc. ........................... 2,340,698
117,105 +MCI WorldCom, Inc. ................................. 5,313,639
134,094 +Microsoft Corp. .................................... 14,297,773
8,417 Motorola, Inc. ...................................... 1,198,370
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 2000
Equity Fund -- (continued)
<TABLE>
<CAPTION>
Shares Value
------ ------------
<C> <S> <C>
COMMON STOCKS -- (continued)
TECHNOLOGY -- (continued)
17,900 +Nextel Communications, Inc., Class A.................... $ 2,652,556
18,415 Nokia Oyj, Class A, ADR.................................. 4,000,659
14,814 Nortel Networks Corp. ................................... 1,866,564
61,982 +Oracle Corp. ........................................... 4,834,596
4,119 +QUALCOMM, Inc. ......................................... 614,503
500 +Register.com ........................................... 34,750
36,127 SBC Communication, Inc. ................................. 1,517,334
63,429 +Sun Microsystems, Inc. ................................. 5,942,505
1,000 +Sycamore Networks, Inc. ................................ 128,750
1,000 +UTStarcom, Inc. ........................................ 78,125
1,150 +ValueClick, Inc. ....................................... 24,078
7,082 +Yahoo!, Inc. ........................................... 1,213,235
------------
87,111,044
------------
TELECOMMUNICATIONS -- 0.30%
2,615 +Broadcom Corp. ......................................... 635,118
------------
UTILITIES -- 1.34%
50,279 AT&T Corp................................................ 2,828,194
------------
TOTAL COMMON STOCKS
(Cost $124,280,948)..................................... 208,521,045
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
---------- ------------
<C> <S> <C>
DEMAND NOTES -- 1.25%
$1,300,000 Associates Corp. of North America Master Notes....... $ 1,300,000
1,335,000 General Electric Co. Promissory Notes................ 1,335,000
------------
TOTAL DEMAND NOTES (Cost $2,635,000)................. 2,635,000
------------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS
(Cost $126,915,948)....................................... 99.79% $211,156,045
OTHER ASSETS AND
LIABILITIES (NET)......................................... 0.21 445,003
------ ------------
NET ASSETS................................................. 100.00% $211,601,048
====== ============
</TABLE>
--------
+Non-income producing security
ADR--American Depositary Receipt
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 2000
Income Fund
<TABLE>
<CAPTION>
Principal Coupon Maturity
Amount Rate Date Value
--------- ------ -------- -----------
<C> <S> <C> <C> <C>
ASSET BACKED SECURITIES -- 14.06%
$1,545,000 American Express Credit Account
Master Trust, Series 00-1, Class A... 7.20% 09/17/07 $ 1,546,993
2,600,000 CIT Group RV Trust, Series 99-A,
Class A4............................. 6.16 06/15/13 2,518,880
2,000,000 Commercial Mortgage Asset Trust,
Series 99-C1, Class A3............... 6.64 09/17/10 1,871,924
1,848,797 Government National Mortgage
Association, Series 99-19, Class A... 6.50 08/16/25 1,764,600
2,083,009 LB Commercial Conduit Mortgage Trust,
Series 99-C1, Class A1............... 6.41 08/15/07 1,997,531
2,053,056 Merrill Lynch Mortgage
Investors, Inc., Series 95-C2,
Class C.............................. 7.33 06/15/21 2,001,422
754,591 Mortgage Capital Funding, Inc.,
Series 98-MC1, Class A1.............. 6.42 06/18/07 727,886
1,588,228 Nomura Asset Securities Corp.,
Series 98-D6, Class A1A.............. 6.28 03/17/28 1,522,904
-----------
TOTAL ASSET BACKED SECURITIES
(Cost $14,330,990)................................... 13,952,140
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal Coupon Maturity
Amount Rate Date Value
--------- ------ -------- -----------
<C> <S> <C> <C> <C>
CORPORATE BONDS -- 17.43%
$2,260,000 Associates Corp. of North America... 5.80% 04/20/04 $ 2,126,321
1,660,000 Avnet, Inc.......................... 7.88 02/15/05 1,669,960
1,290,000 Bank One Corp....................... 6.88 06/15/03 1,259,397
1,185,000 Countrywide Home Loans, Inc. ....... 6.85 06/15/04 1,150,676
2,960,000 DaimlerChrysler North American
Holding Corp........................ 7.40 01/20/05 2,952,698
3,000,000 Ford Motor Credit Co................ 5.75 02/23/04 2,825,439
1,780,000 Ford Motor Credit Co................ 7.38 10/28/09 1,741,374
1,455,000 General Motors Corp................. 6.25 05/01/05 1,376,479
1,000,000 Mercantile Safe Deposit & Trust Co.. 6.10 05/17/04 952,500
1,290,000 Norwest Corp........................ 6.50 06/01/05 1,237,825
-----------
TOTAL CORPORATE BONDS
(Cost $17,733,729).................................. 17,292,669
-----------
U.S. GOVERNMENT &
AGENCY OBLIGATIONS -- 66.61%
Federal Home Loan
Mortgage Corporation
1,348 Pool #220001........................ 10.75 07/01/00 1,356
Federal National
Mortgage Association
3,510,231 Pool #251502........................ 6.50 02/01/13 3,377,765
12,525 Pool #454758........................ 5.50 12/01/28 11,005
562,807 Pool #496120........................ 7.00 04/01/29 540,986
5,215,890 Pool #504052........................ 7.00 06/01/29 5,013,659
9,992,555 Pool #521423........................ 7.50 12/01/29 9,823,501
4,938,536 Pool #525818........................ 7.50 12/01/29 4,854,986
1,998,401 Pool #531743........................ 7.00 02/01/30 1,920,919
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 2000
Income Fund -- (continued)
<TABLE>
<CAPTION>
Principal Coupon Maturity
Amount Rate Date Value
--------- ------ -------- -----------
<C> <S> <C> <C> <C>
U.S. GOVERNMENT & AGENCY
OBLIGATIONS -- (continued)
Government National
Mortgage Association
$2,016,768 Pool #781036.......................... 8.00% 10/15/17 $ 2,039,565
675,433 Pool #471660.......................... 7.50 03/15/28 669,494
1,541,162 Pool #472028.......................... 6.50 05/15/28 1,453,474
1,623,189 Pool #475847.......................... 6.50 06/15/28 1,530,834
2,045,864 Pool #80205........................... 6.00 06/20/28 2,002,692
3,667,780 Pool #2687............................ 6.00 12/20/28 3,339,536
3,837,143 Pool #503711.......................... 7.00 05/15/29 3,716,323
1,179,417 Pool #80311........................... 5.50 08/20/29 1,141,494
2,261,888 Pool #525556.......................... 8.00 01/15/30 2,287,456
2,700,000 Pool #80385........................... 6.00 03/20/30 2,642,887
9,038,000 U.S. Treasury Bonds................... 7.25 05/15/16 9,989,819
1,379,767 U.S. Treasury Inflation Index Bond.... 3.88 04/15/29 1,368,126
5,560,000 U.S. Treasury Note.................... 6.50 02/15/10 5,754,600
6,470,000 U.S. Treasury Strip Bonds............. 6.78 02/15/15 2,598,734
-----------
TOTAL U.S. GOVERNMENT & AGENCY OBLIGATIONS
(Cost $66,628,572).................................... 66,079,211
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
------ -----------
<C> <S> <C>
SHORT-TERM INVESTMENTS -- 1.52%
759,344 Dreyfus Government Cash Management Fund.................. $ 759,344
749,115 Fidelity U.S. Treasury II Fund........................... 749,115
-----------
TOTAL SHORT-TERM INVESTMENTS (Cost $1,508,459)........... 1,508,459
-----------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS
(Cost $100,201,750)........................................ 99.62% $98,832,479
OTHER ASSETS AND
LIABILITIES (NET).......................................... 0.38 376,657
------ -----------
NET ASSETS.................................................. 100.00% $99,209,136
====== ===========
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 2000
Total Return Bond Fund
<TABLE>
<CAPTION>
Principal Coupon Maturity
Amount Rate Date Value
--------- ------ -------- -----------
<C> <S> <C> <C> <C>
ASSET BACKED SECURITIES -- 25.51%
$ 6,580,000 +AESOP Funding II, Series 97-1,
Class A2............................ 6.40% 10/20/03 $ 6,456,099
6,110,000 American Express Credit Account
Master Trust, Series 2000-1,
Class A............................. 7.20 9/17/07 6,117,882
8,960,000 Capital Auto Receivables Asset
Trust, Series 99-1, Class A3........ 5.68 8/15/04 8,766,822
3,400,000 Citibank Credit Card Master Trust I,
Series 99-5, Class A................ 6.10 5/15/08 3,211,300
7,790,000 Commercial Mortgage Asset Trust,
Series 99-C1, Class A3.............. 6.64 9/17/10 7,291,144
3,665,000 Fannie Mae-Aces, Series 97-M5,
Class C............................. 6.74 8/25/07 3,556,883
7,692,600 LB Commercial Conduit Mortgage
Trust, Series
99-C1, Class A1..................... 6.41 8/15/07 7,376,929
5,000,000 MBNA Master Credit Card Trust,
Series 99-J, Class A................ 7.00 2/15/12 4,923,600
3,938,701 Mortgage Capital Funding, Inc.,
Series 98-MC1, Class A1............. 6.42 6/18/07 3,799,310
8,130,000 Nationslink Funding Corp.,
Series 99-2, Class B................ 7.53 11/20/08 8,034,879
4,867,150 Nomura Asset Securities Corp.,
Series 98-D6, Class A1A............. 6.28 3/17/28 4,666,963
3,525,000 Peco Energy Transition Trust,
Series 99-A, Class A4............... 5.80 3/01/07 3,326,825
-----------
TOTAL ASSET BACKED SECURITIES
(Cost $68,957,655)................................... 67,528,636
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal Coupon Maturity
Amount Rate Date Value
--------- ------ -------- ----------
<C> <S> <C> <C> <C>
CORPORATE BONDS -- 27.89%
$ 6,000,000 Associates Corp. of North America.... 5.75% 11/01/03 $5,680,314
3,295,000 Association Corporation of North
America.............................. 5.80 4/20/04 3,100,101
3,400,000 Avnet, Inc........................... 7.88 2/15/05 3,420,400
10,380,000 Bank of America Corp. ............... 6.63 6/15/04 10,083,412
5,370,000 Duke Capital Corp.................... 7.25 10/01/04 5,305,259
9,000,000 Ford Motor Credit Co................. 5.75 2/23/04 8,476,317
8,105,000 General Motors Acceptance Corp....... 6.85 6/17/04 7,897,942
4,060,000 Goldman Sachs Group Inc., Series B... 7.35 10/01/09 3,942,966
4,760,000 Lehman Brothers Holding Corp......... 6.63 4/01/04 4,584,594
3,895,000 McDonalds Corp....................... 5.90 5/11/01 3,845,643
7,035,000 Mercantile Safe Deposit & Trust...... 6.10 5/17/04 6,700,837
3,950,000 Morgan Stanley Dean Witter & Co...... 6.38 8/01/02 3,862,654
7,190,000 Star Bank N.A........................ 6.38 3/01/04 6,917,312
----------
TOTAL CORPORATE BONDS
(Cost $76,011,663).................................... 73,817,751
----------
U.S. GOVERNMENT & AGENCY
OBLIGATIONS -- 43.86%
Federal National
Mortgage Association
6,700,000 Pool #489792......................... 5.13 2/13/04 6,257,056
3,160,663 Pool #525818......................... 7.50 12/01/29 3,107,191
Government National
Mortgage Association
24,901 Pool #356873......................... 6.50 5/15/23 23,484
3,425,246 Pool #80185.......................... 5.00 4/20/28 3,352,967
2,037,713 Pool #80205.......................... 6.00 6/20/28 1,994,713
4,801,803 Pool #2687........................... 6.00 12/20/28 4,372,070
3,783,961 Pool #80311.......................... 5.50 8/20/29 3,662,292
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 2000
Total Return Bond Fund -- (continued)
<TABLE>
<CAPTION>
Principal Coupon Maturity
Amount Rate Date Value
--------- ------ -------- ------------
<C> <S> <C> <C> <C>
U.S. GOVERNMENT & AGENCY
OBLIGATIONS -- (continued)
Government National
Mortgage Association -- (continued)
$ 1,248,086 Pool #479087...................... 8.00% 1/15/30 $ 1,262,194
9,985,292 Pool #479088...................... 8.00 1/15/30 10,098,166
64,259,000 U.S. Treasury Bonds............... 7.25 5/15/16 71,026,308
2,938,117 U.S. Treasury Inflation Index
Bonds............................. 3.88 4/15/29 2,913,328
6,600,000 U.S. Treasury Note................ 11.75 2/15/10 8,010,750
------------
TOTAL U.S. GOVERNMENT & AGENCY OBLIGATIONS
(Cost $118,344,134)................................ 116,080,519
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
------ ------------
<C> <S> <C>
SHORT-TERM INVESTMENTS -- 1.78%
2,313,822 Dreyfus Government Cash Management Fund............... $ 2,313,822
2,396,361 Fidelity U.S. Treasury II Fund........................ 2,396,361
------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $4,710,183)..................................... 4,710,183
------------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS
(Cost $268,023,635)....................................... 99.04% $262,137,089
OTHER ASSETS AND
LIABILITIES (NET)......................................... 0.96 2,533,725
------ ------------
NET ASSETS................................................. 100.00% $264,670,814
====== ============
</TABLE>
--------
+144A Security--certain conditions for public sale may exist.
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 2000
International Equity Fund
<TABLE>
<CAPTION>
Shares Value
------- -----------
<C> <S> <C>
COMMON STOCKS -- 98.81%
AUSTRALIA -- 1.04%
50,900 Brambles Industries Ltd. ................................ $ 1,292,418
-----------
CANADA -- 7.16%
48,500 Bombardier, Inc., Class B................................ 1,216,337
77,500 +CGI Group, Inc. ........................................ 1,087,794
20,400 +JDS Uniphase Corp. ..................................... 2,458,200
24,041 Nortel Networks Corp. ................................... 3,012,155
16,050 +Sierra Wireless, Inc. .................................. 1,105,964
-----------
8,880,450
-----------
CHILE -- 0.43%
14,000 Vina Concha Y Toro S.A., ADR............................. 539,000
-----------
EGYPT -- 0.75%
19,200 Egyptian Company for Mobile Services (Mobinil)........... 930,569
-----------
FINLAND -- 2.61%
10,600 Nokia Oyj, Class A....................................... 2,242,345
14,500 Sonera Oyj............................................... 989,605
-----------
3,231,950
-----------
FRANCE -- 13.08%
20,540 Axa...................................................... 2,911,788
9,310 Carrefour S.A. .......................................... 1,193,258
22,650 Dassault Systemes S.A. .................................. 2,137,713
20,800 STMicroelectronics N.V. ................................. 3,822,688
21,122 Total S.A., Class B...................................... 3,164,125
26,000 Vivendi.................................................. 2,998,918
-----------
16,228,490
-----------
GERMANY -- 8.45%
5,300 Allianz AG............................................... 2,184,003
7,500 +Consors Discount Broker AG.............................. 1,012,243
14,000 Deutsche Telekom AG...................................... 1,081,449
4,670 SAP AG................................................... 2,659,733
25,100 Siemens AG............................................... 3,543,806
-----------
10,481,234
-----------
HONG KONG -- 4.45%
10,600 +China Telecom (Hong Kong) Ltd. ADR...................... 1,878,850
205,000 Johnson Electric Holdings Ltd. .......................... 1,401,946
484,000 +Li & Fung Ltd. ......................................... 2,243,935
-----------
5,524,731
-----------
IRELAND -- 0.64%
87,400 Irish Life & Permanent plc............................... 794,766
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
------- -----------
<C> <S> <C>
COMMON STOCKS -- (continued)
ISRAEL -- 1.07%
11,300 +Gilat Satellite Networks Ltd. .......................... $ 1,322,100
-----------
ITALY -- 1.29%
400,900 UniCredito Italiano S.p.A................................ 1,596,370
-----------
JAPAN -- 21.53%
167 DDI Corp. ............................................... 1,365,224
14,500 Don Quijote Co., Ltd. ................................... 2,500,731
268,000 Furukawa Electric Co., Ltd. ............................. 4,504,531
8,100 Kyocera Corp. ........................................... 1,354,341
13,000 NIDEC Corp. ............................................. 1,178,018
10,400 Nintendo Co., Ltd. ...................................... 1,829,095
239 NTT Data Corp. .......................................... 4,494,495
4,800 Rohm Co. ................................................ 1,669,687
31,000 Sony Corp. .............................................. 4,379,811
27,700 TOKYO SEIMITSU Co., Ltd. ................................ 3,435,847
-----------
26,711,780
-----------
KOREA -- 1.68%
26,923 S1 Corp. ................................................ 411,763
5,500 Samsung Electronics...................................... 1,667,421
-----------
2,079,184
-----------
NETHERLANDS -- 1.46%
16,600 +Equant N.V. ............................................ 1,377,626
18,900 Wolters Kluwer N.V. ..................................... 434,188
-----------
1,811,814
-----------
PORTUGAL -- 0.80%
183,650 Banco Comercial Portugues S.A. .......................... 986,184
-----------
SINGAPORE -- 5.66%
620,754 Datacraft Asia Ltd. ..................................... 5,804,050
186,000 Natsteel Electronics Ltd. ............................... 1,217,178
-----------
7,021,228
-----------
SPAIN -- 2.65%
132,880 Banco Bilbao Vizcaya S.A. (Registered)................... 1,953,688
52,900 +Telefonica S.A.......................................... 1,336,792
-----------
3,290,480
-----------
SWEDEN -- 4.31%
60,800 +LM Ericsson, Class B.................................... 5,349,160
-----------
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 2000
International Equity Fund -- (continued)
<TABLE>
<CAPTION>
Shares Value
--------- ------------
<C> <S> <C>
COMMON STOCKS -- (continued)
SWITZERLAND -- 1.93%
14 Lindt & Spruengli AG.................................. $ 357,852
187 Roche Holding AG...................................... 2,031,166
------------
2,389,018
------------
TAIWAN -- 1.22%
225,000 +Taiwan Semiconductor Manufacturing Co. .............. 1,518,269
------------
THAILAND -- 1.78%
1,034,800 Banpu Public Co., Ltd. (Registered)................... 663,860
192,900 BEC World Public Co., Ltd. (Foreign).................. 1,439,095
80,500 Dhipaya Insurance Public Co., Ltd. ................... 106,482
------------
2,209,437
------------
UNITED KINGDOM -- 14.82%
316,100 Airtours plc.......................................... 1,693,366
3,100 Baltimore Technologies plc............................ 424,110
536,817 Invensys Siebe plc.................................... 2,378,319
34,500 Glaxo Wellcome plc.................................... 985,150
180,596 Granada Group plc..................................... 1,932,054
113,703 Kingfisher plc........................................ 931,532
30,000 Pearson plc........................................... 1,040,868
56,200 Serco Group plc....................................... 2,436,248
12,800 Shell Transport & Trading Co., ADR.................... 628,000
173,385 Shell Transport & Trading Co., plc.................... 1,434,279
812,708 Vodafone AirTouch plc................................. 4,505,635
------------
18,389,561
------------
TOTAL COMMON STOCKS
(Cost $76,494,437)................................... 122,578,193
------------
</TABLE>
<TABLE>
<CAPTION>
No. of
Warrants Value
--------- -----------
<C> <S> <C>
WARRANTS -- 0.54%
PHILIPPINES -- 0.48%
2,289,500 +Queenbee Restaurants-Jolibee Foods Corp., expiring
3/24/03 at $19.25.................................... $ 599,565
-----------
THAILAND -- 0.06%
517,400 +Banpu Public Co., Ltd., expiring 01/14/03 at $33.88.. 79,389
-----------
TOTAL WARRANTS
(Cost $1,140,083).................................... 678,954
-----------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS
(Cost $77,634,520)........................................ 99.35% $123,257,147
OTHER ASSETS AND
LIABILITIES (NET)......................................... 0.65 802,811
------ ------------
NET ASSETS................................................. 100.00% $124,059,958
====== ============
</TABLE>
--------
+Non-income producing security
ADR--American Depositary Receipt
At March 31, 2000, sector diversification of the Fund's investment portfolio
was as follows:
<TABLE>
<CAPTION>
% of
Net Market
Sector Diversification (Unaudited) Assets Value
---------------------------------- ------ ------------
<S> <C> <C>
Information Technology.................................... 22.65% $ 28,107,686
Technology................................................ 17.73 21,994,793
Consumer Discretionary.................................... 15.81 19,617,932
Industrials............................................... 15.20 18,852,791
Financials................................................ 9.31 11,545,523
Telecommunication Services................................ 6.35 7,878,667
Energy.................................................... 4.21 5,226,404
Health Care............................................... 2.43 3,016,316
Utilities................................................. 2.42 2,998,918
Capital Goods............................................. 1.09 1,354,341
Consumer Staples.......................................... 0.72 896,852
Warrants.................................................. 0.55 678,954
Materials................................................. 0.54 663,860
Consumer Cyclicals........................................ 0.34 424,110
------ ------------
Total Investments........................................ 99.35% $123,257,147
Other Assets and Liabilities (Net)........................ 0.65 802,811
------ ------------
Net Assets............................................... 100.00% $124,059,958
====== ============
</TABLE>
FORWARD FOREIGN CURRENCY CONTACTS
Under the terms of forward foreign currency contracts open at 3/31/2000, the
International Equity Fund is obligated to deliver currency in exchange for
U.S. dollars as indicated below:
<TABLE>
<CAPTION>
Currency In
to Exchange Settlement Net Unrealized
Deliver for Date Value (Depreciation)
--------------- ---------- ---------- ---------- --------------
<S> <C> <C> <C> <C> <C>
Purchases...... JPY 401,570,820 $4,003,591 8/08/00 $3,801,674 $(201,917)
=========
</TABLE>
JPY -- Japanese Yen
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 2000
Optimum Growth Fund
<TABLE>
<CAPTION>
Shares Value
------- ------------
<C> <S> <C>
COMMON STOCKS -- 99.26%
CAPITAL GOODS -- 7.02%
41,600 General Electric Co. ................................... $ 6,455,800
15,000 Vastar Resources, Inc. ................................. 1,114,687
------------
7,570,487
------------
COMMUNICATIONS
SERVICES -- 9.35%
76,000 +America Online, Inc. .................................. 5,111,000
16,900 +Exodus Communications, Inc. ........................... 2,374,450
57,250 +MCI WorldCom, Inc. .................................... 2,597,719
------------
10,083,169
------------
CONSUMER CYCLICAL -- 13.66%
2,000 +Analog Devices, Inc. .................................. 161,125
25,000 +Clear Channel Communications, Inc. .................... 1,726,562
18,000 Dow Jones & Co., Inc. .................................. 1,292,625
35,000 Harley-Davidson, Inc. .................................. 2,778,125
72,000 Home Depot, Inc. ....................................... 4,644,000
10,000 McDonald's Corp. ....................................... 375,625
13,200 Omnicom Group, Inc. .................................... 1,233,375
45,500 Wal-Mart Stores, Inc. .................................. 2,525,250
------------
14,736,687
------------
CONSUMER STAPLES -- 2.30%
6,800 Coca-Cola Co. .......................................... 319,175
21,600 Time Warner, Inc. ...................................... 2,160,000
------------
2,479,175
------------
FINANCIAL -- 10.08%
25,000 American International Group, Inc. ..................... 2,737,500
88,400 Schwab (Charles) Corp. ................................. 5,022,225
52,500 Citigroup, Inc. ........................................ 3,113,906
------------
10,873,631
------------
HEALTH CARE -- 10.31%
7,000 Amgen, Inc. ............................................ 429,188
6,000 Genentech, Inc. ........................................ 912,000
83,710 Medtronic, Inc. ........................................ 4,305,833
3,000 Merck & Co., Inc. ...................................... 186,375
10,000 PE Corp.-PE Biosystems Group ........................... 965,000
66,000 Pfizer, Inc. ........................................... 2,413,125
4,300 Schering-Plough Corp. .................................. 158,025
18,000 Warner Lambert Co. ..................................... 1,755,000
------------
11,124,546
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
------- ------------
<C> <S> <C>
COMMON STOCKS -- (continued)
TECHNOLOGY -- 46.54%
10,000 Applied Material, Inc. ................................. $ 942,500
1,200 Bea Systems, Inc. ...................................... 87,900
600 Broadcom Corp. ......................................... 145,725
83,000 Cisco Systems, Inc. .................................... 6,416,937
103,000 Dell Computer Corp. .................................... 5,555,562
43,900 EMC Corp. .............................................. 5,487,500
1,000 Hewlett-Packard Co. .................................... 132,563
42,100 Intel Corp. ............................................ 5,549,306
10,000 International Business Machines Corp. .................. 1,180,000
16,000 JDS Uniphase Corp. ..................................... 1,928,000
26,600 Lucent Technologies, Inc. .............................. 1,615,950
45,000 Microsoft Corp. ........................................ 4,798,125
22,000 Nokia Oyj., Class A ADR................................. 4,779,500
24,500 Oracle Corp. ........................................... 1,911,000
1,200 PMC-Sierra, Inc. ....................................... 244,350
6,000 QUALCOMM, Inc. ......................................... 895,125
700 Siebel Systems, Inc. ................................... 83,563
36,000 Solectron Corp. ........................................ 1,442,250
33,000 Sun Microsystems, Inc. ................................. 3,091,688
36,000 Tellabs, Inc. .......................................... 2,265,750
6,500 Texas Instruments, Inc. ................................ 1,040,000
3,000 VERITAS Software Corp. ................................. 393,000
1,200 Yahoo!, Inc. ........................................... 205,575
------------
50,191,869
------------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS (Cost $45,533,476)...................... 99.26% $107,059,564
OTHER ASSETS AND
LIABILITIES (NET)........................................ 0.74 795,935
------ ------------
NET ASSETS................................................ 100.00% $107,855,499
====== ============
</TABLE>
--------
+ Non-income producing security
ADR--American Depositary Receipt
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Schedule of Investments
March 31, 2000
Value Equity Fund
<TABLE>
<CAPTION>
Shares Value
------- -----------
<C> <S> <C>
COMMON STOCKS -- 98.36%
CAPITAL GOODS -- 2.39%
10,000 Honeywell International, Inc. ........................... $ 526,875
1,500 Quantum Effect Devices, Inc. ............................ 119,438
40,000 Timken Co. .............................................. 650,000
-----------
1,296,313
-----------
COMMUNICATION SERVICES -- 13.22%
10,000 +Alamosa PCS Holdings, Inc. ............................. 374,375
13,000 AT&T Corp. .............................................. 731,250
10,000 BCE, Inc. ............................................... 1,245,355
20,000 CenturyTel, Inc. ........................................ 742,500
86,100 +Global Crossing Ltd. ................................... 3,524,719
25,000 +Snyder Communications, Inc. ............................ 562,500
-----------
7,180,699
-----------
CONSUMER CYCLICALS -- 22.81%
15,000 +Adelphia Communications, Inc. .......................... 734,063
1,700 +Avanex Corp. ........................................... 257,975
5,000 Black & Decker Corp. .................................... 187,813
25,000 +CBS Corp. .............................................. 1,415,625
35,000 Centex Corp. ............................................ 833,437
33,000 Deluxe Corp. ............................................ 874,500
25,000 Ford Motor Co. .......................................... 1,148,437
18,000 +General Motors Corp., Class H........................... 2,241,000
32,000 News Corp., Ltd., ADR.................................... 1,800,000
1,500 +Universal Access, Inc. ................................. 50,625
50,000 +Varian, Inc. ........................................... 1,918,750
19,700 Young & Rubicam, Inc..................................... 925,900
-----------
12,388,125
-----------
CONSUMER STAPLE -- 9.34%
45,760 +AT&T Corp. - Liberty Media Group, Class A............... 2,711,280
37,000 Avon Products, Inc. ..................................... 1,075,313
32,000 +Suiza Foods Corp. ...................................... 1,288,000
-----------
5,074,593
-----------
ENERGY -- 2.40%
20,000 Conoco, Inc., Class B.................................... 512,500
55,000 +Ocean Energy, Inc. ..................................... 790,625
-----------
1,303,125
-----------
FINANCIAL -- 10.66%
20,000 Chase Manhattan Corp. ................................... 1,743,750
12,000 Citigroup, Inc. ......................................... 711,750
20,000 Donaldson Lufkin & Jenrette, Inc., - DLJ................. 1,035,000
13,000 Fannie Mae............................................... 733,687
22,000 SLM Holding Corp. ....................................... 732,875
15,000 XL Capital Ltd., Class A................................. 830,625
-----------
5,787,687
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
--------- -----------
<C> <S> <C>
COMMON STOCKS -- (continued)
HEALTH CARE -- 3.75%
10,000 American Home Products Corp. .......................... $ 536,250
26,000 Bristol-Meyers Squibb Co. ............................. 1,501,500
-----------
2,037,750
-----------
TECHNOLOGY -- 29.86%
1,250 +ArrowPoint Communications, Inc. ...................... 148,047
5,000 +Cypress Communications, Inc. ......................... 122,500
30,000 Harris Corp. .......................................... 1,036,875
4,500 +Infineon Technologies AG.............................. 258,469
2,454 Intermedia Communications, Inc. ....................... 118,406
18,000 International Business Machines Corp. ................. 2,124,000
30,000 Nokia Corp., Class A ADR............................... 6,517,500
3,500 +Plantronics, Inc. .................................... 326,156
300 +Selectica, Inc. ...................................... 26,456
20,000 Texas Instruments, Inc. ............................... 3,200,000
35,000 +Unisys Corp. ......................................... 892,500
1,150 +ValueClick, Inc....................................... 24,078
1,600 +Webmethods, Inc. ..................................... 385,800
40,000 Xerox Corp. ........................................... 1,040,000
-----------
16,220,787
-----------
TRANSPORTATION -- 3.93%
13,000 +AMR Corp. ............................................ 414,375
20,000 Kansas City Southern Industries, Inc. ................. 1,718,750
-----------
2,133,125
-----------
TOTAL COMMON STOCKS (Cost $27,297,585)................. 53,422,204
-----------
<CAPTION>
Principal
Amount
---------
<C> <S> <C>
CONVERTIBLE BONDS -- 2.61%
TECHNOLOGY -- 2.61%
$22,000 Intermedia Communications, Inc., (Cost $578,407)....... 1,416,250
-----------
DEMAND NOTES -- 0.01%
6,000 General Electric Co. Promissory Notes (Cost $6,000).... 6,000
-----------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS (Cost $27,881,992)....................... 100.98% $54,844,454
OTHER ASSETS AND LIABILITIES (NET)......................... (0.98) (530,207)
------ -----------
NET ASSETS................................................. 100.00% $54,314,247
====== ===========
</TABLE>
--------
+ Non-income producing security
ADR--American Depositary Receipt
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Assets and Liabilities
March 31, 2000
<TABLE>
<CAPTION>
Total Return
Equity Income Bond
Fund Fund Fund
------------ ------------ ------------
<S> <C> <C> <C>
Assets:
Investments, at cost -- see
accompanying
Schedule of Investments........... $126,915,948 $100,201,750 $268,023,635
============ ============ ============
Investments in securities, at value
(Note 1a)......................... $211,156,045 $ 98,832,479 $262,137,089
Cash............................... 94,977 -- 77,908
Dividends receivable............... 115,554 -- --
Interest receivable................ 7,408 974,224 3,983,703
Receivable for investment
securities sold................... 426,170 3,848 1,169
Other assets....................... 5,660 2,123 7,591
------------ ------------ ------------
Total assets....................... 211,805,814 99,812,674 266,207,460
Liabilities:
Payable for investments purchased.. 64,350 -- --
Dividends payable.................. -- 546,920 1,380,453
Investment advisory fees payable
(Note 2a)......................... 57,660 18,937 52,952
Administration fees payable (Note
2b)............................... 26,358 13,468 36,231
Trustees' fees and expenses payable
(Note 2f)......................... 2,596 1,099 3,394
Accrued expenses and other
liabilities....................... 53,802 23,114 63,616
------------ ------------ ------------
Total liabilities.................. 204,766 603,538 1,536,646
------------ ------------ ------------
Net Assets.......................... $211,601,048 $ 99,209,136 $264,670,814
============ ============ ============
Net Assets Consist of:
Par value.......................... $ 121 $ 149 $ 378
Paid-in capital in excess of par
value............................. 104,713,570 103,230,294 278,403,998
Undistributed (distributions in
excess of) net investment income.. -- (39,449) 47,718
Accumulated net realized gain
(loss) on investments............. 22,647,260 (2,612,587) (7,894,734)
Unrealized appreciation
(depreciation) of investments..... 84,240,097 (1,369,271) (5,886,546)
------------ ------------ ------------
Net Assets.......................... $211,601,048 $ 99,209,136 $264,670,814
============ ============ ============
Institutional Shares outstanding
(Unlimited number of $0.00001 par
value shares authorized for each
Fund).............................. 12,106,120 14,900,889 37,779,109
Net Asset Value Per Share (net
assets / shares outstanding)....... $ 17.48 $ 6.66 $ 7.01
============ ============ ============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Assets and Liabilities -- (continued)
March 31, 2000
<TABLE>
<CAPTION>
International Optimum Value
Equity Growth Equity
Fund Fund Fund
------------- ------------ -----------
<S> <C> <C> <C>
Assets:
Investments at cost -- see accompany-
ing
Schedule of Investments............. $ 77,634,520 $ 45,533,476 $27,881,992
============ ============ ===========
Investments in securities, at value
(Note 1a)........................... $123,257,147 $107,059,564 $54,844,454
Foreign currency at value (Cost
$12,247)............................ 12,388 -- --
Dividends receivable................. 96,819 45,563 31,955
Interest receivable.................. -- 4,968 821
Receivable for investment securities
sold................................ 2,327,996 1,988,020 356,222
Receivable for fund shares sold...... -- 17,635 --
Foreign withholding tax receivable... 28,923 -- --
Deferred organization expenses (Note
1f)................................. -- 280 280
Other assets......................... 3,379 2,600 1,384
------------ ------------ -----------
Total assets......................... 125,726,652 109,118,630 55,235,116
Liabilities:
Payable for investments purchased.... -- 955,387 274,537
Investment advisory fees payable
(Note 2a)........................... 16,211 28,911 21,904
Administration fees payable (Note
2b)................................. 20,780 12,357 7,309
Trustees' fees and expenses payable
(Note 2f)........................... 1,623 1,591 629
Net unrealized depreciation on open
forward foreign currency contracts.. 201,917 -- --
Due to custodian bank................ 1,362,069 147,106 599,821
Accrued expenses and other
liabilities......................... 64,094 117,779 16,669
------------ ------------ -----------
Total liabilities.................... 1,666,694 1,263,131 920,869
------------ ------------ -----------
Net Assets............................ $124,059,958 $107,855,499 $54,314,247
============ ============ ===========
Net Assets Consist of:
Par value............................ $ 90 $ 35 $ 25
Paid-in capital in excess of par
value............................... 66,635,141 35,322,451 26,466,390
Undistributed (distributions in
excess of) net investment income.... 13,119 -- 688
Accumulated net realized gain on
investments......................... 11,992,095 11,006,925 884,672
Unrealized appreciation of
investments and foreign currency
translations........................ 45,419,513 61,526,088 26,962,472
------------ ------------ -----------
Net Assets............................ $124,059,958 $107,855,499 $54,314,247
============ ============ ===========
Net Assets:
Institutional Shares................. $124,059,958 $ 85,888,839 $53,977,757
Shares............................... -- 21,966,660 336,490
Shares outstanding (Unlimited number
of $0.00001 par value shares
authorized for each Fund):
Institutional Shares................. 8,999,752 2,785,986 2,531,945
Shares............................... -- 718,607 15,766
Net Asset Value Per Share (net
assets / shares outstanding):
Institutional Shares................. $ 13.78 $ 30.83 $ 21.32
============ ============ ===========
Shares............................... -- $ 30.57 $ 21.34
============ ============ ===========
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Operations
For the Year Ended March 31, 2000
<TABLE>
<CAPTION>
Total Return International Optimum Value
Equity Income Bond Equity Growth Equity
Fund Fund Fund Fund Fund Fund
----------- ----------- ------------ ------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Investment Income:
Dividend income........... $ 1,504,489 $ -- $ -- $ 1,040,342 $ 523,906 $ 515,638
Interest income........... 100,418 5,283,567 16,862,961 180,106 95,383 10,808
Less: Foreign taxes
withheld................. -- -- -- (120,105) -- --
----------- ----------- ------------ ----------- ----------- -----------
Total Income.............. 1,604,907 5,283,567 16,862,961 1,100,343 619,289 526,446
Expenses (Note 1g):
Investment advisory fees
(Note 2a)................ 1,253,573 522,171 1,726,804 1,083,451 655,463 308,517
Administration fees
(Note 2b)................ 293,462 122,299 404,662 216,690 153,552 72,228
Administrative servicing
fees (Note 2d)........... -- -- -- -- 13,786 --
Custodian fees............ 82,895 21,427 68,119 162,973 27,856 16,344
Legal and audit fees...... 46,081 18,463 63,683 26,210 24,633 10,881
Prospectus and shareholder
reports.................. 17,142 6,868 23,388 23,551 13,295 3,870
Registration and filing
fees..................... 14,734 18,027 17,768 34,767 23,092 21,334
Trustees' fees and
expenses (Note 2f)....... 9,509 3,744 13,248 5,463 5,107 2,380
Shareholder servicing
agent fees............... 6,725 8,494 8,748 14,127 14,408 10,995
Insurance expense......... 2,406 1,082 3,394 930 950 616
Amortization of
organization expenses
(Note 1f)................ 567 -- 750 245 245 245
Distribution fees --
Shares (Note 2e)......... -- -- -- -- 45,308 343
Miscellaneous............. 9,355 3,237 13,663 8,558 5,854 2,841
----------- ----------- ------------ ----------- ----------- -----------
Total Expenses............ 1,736,449 725,812 2,344,227 1,576,965 983,549 450,594
Less: Waiver of fees
(Note 2c)................ (386,474) (324,481) (1,016,516) (600,158) (135,244) (71,673)
----------- ----------- ------------ ----------- ----------- -----------
Net Expenses.............. 1,349,975 401,331 1,327,711 976,807 848,305 378,921
----------- ----------- ------------ ----------- ----------- -----------
Net Investment Income
(Loss).................... 254,932 4,882,236 15,535,250 123,536 (229,016) 147,525
----------- ----------- ------------ ----------- ----------- -----------
Realized and Unrealized
Gain (Loss) (Note 1):
Net realized gain (loss)
on investments........... 28,551,531 (2,627,741) (7,340,007) 13,177,380 22,425,776 1,293,913
Net realized loss on
foreign currency
transactions............. -- -- -- (57,016) -- (2,680)
Change in unrealized
appreciation/depreciation
of investments and
foreign currency
translations during the
year..................... 17,315,322 (859,438) (4,358,337) 43,802,744 3,177,959 15,693,776
----------- ----------- ------------ ----------- ----------- -----------
Net Realized and Unrealized
Gain (Loss)............... 45,866,853 (3,487,179) (11,698,344) 56,923,108 25,603,735 16,985,009
----------- ----------- ------------ ----------- ----------- -----------
Net Increase in Net Assets
Resulting from Operations. $46,121,785 $ 1,395,057 $ 3,836,906 $57,046,644 $25,374,719 $17,132,534
=========== =========== ============ =========== =========== ===========
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Equity Fund Income Fund Total Return Bond Fund
-------------------------- ------------------------ --------------------------
Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended
March 31, March 31, March 31, March 31, March 31, March 31,
2000 1999 2000 1999 2000 1999
------------ ------------ ----------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income..... $ 254,932 $ 431,024 $ 4,882,236 $ 3,543,754 $ 15,535,250 $ 11,156,699
Net realized gain (loss)
on investments........... 28,551,531 11,056,827 (2,627,741) 1,294,824 (7,340,007) 3,877,687
Change in unrealized
appreciation/depreciation
of investments during the
year..................... 17,315,322 18,360,482 (859,438) (1,175,763) (4,358,337) (4,548,009)
------------ ------------ ----------- ----------- ------------ ------------
Net increase in net
assets resulting from
operations.............. 46,121,785 29,848,333 1,395,057 3,662,815 3,836,906 10,486,377
Distributions to
Shareholders:
From net investment
income................... (400,099) (435,000) (4,842,774) (3,538,256) (15,535,250) (11,156,710)
In excess of net
investment income........ -- -- (39,449) (24,317) -- --
From net realized gains... (14,504,061) (2,446,333) -- (2,171,930) -- (5,489,069)
In excess of net realized
gains.................... -- -- (101,297) -- -- (523,866)
------------ ------------ ----------- ----------- ------------ ------------
Total distributions to
shareholders............ (14,904,160) (2,881,333) (4,983,520) (5,734,503) (15,535,250) (17,169,645)
------------ ------------ ----------- ----------- ------------ ------------
Transactions in Shares of
Beneficial Interest:
Net proceeds from shares
sold..................... 42,522,262 47,139,416 40,035,715 8,666,814 100,164,255 119,082,504
Contribution in-kind...... -- -- -- -- -- 12,430,061
Reinvestment of dividends. 18 7,322 -- -- 329,580 358,289
Cost of shares redeemed... (42,248,475) (32,332,217) (4,477,819) (729,572) (75,738,564) (41,284,954)
------------ ------------ ----------- ----------- ------------ ------------
Net increase in net
assets from beneficial
interest transactions... 273,805 14,814,521 35,557,896 7,937,242 24,755,271 90,585,900
------------ ------------ ----------- ----------- ------------ ------------
Total Increase in Net
Assets................. 31,491,430 41,781,521 31,969,433 5,865,554 13,056,927 83,902,632
Net Assets:
Beginning of Year......... 180,109,618 138,328,097 67,239,703 61,374,149 251,613,887 167,711,255
------------ ------------ ----------- ----------- ------------ ------------
End of Year(a)............ $211,601,048 $180,109,618 $99,209,136 $67,239,703 $264,670,814 $251,613,887
============ ============ =========== =========== ============ ============
Capital Share Transactions:
Institutional Shares sold. 2,697,190 3,624,176 5,958,654 1,221,301 14,248,739 15,800,759
Contribution in-kind...... -- -- -- -- -- 1,646,253
Institutional Shares
issued for dividend
reinvestment............. 1 580 -- -- 46,936 47,445
Institutional Shares
redeemed................. (2,633,992) (2,478,541) (670,179) (100,468) (10,898,429) (5,458,140)
------------ ------------ ----------- ----------- ------------ ------------
Net Increase in Shares
Outstanding............... 63,199 1,146,215 5,288,475 1,120,833 3,397,246 12,036,317
============ ============ =========== =========== ============ ============
--------
(a) Including
undistributed
(distributions in
excess of) net
investment income..... -- $ 110,555 $ (39,449) $ (24,317) $ 47,718 $ 16,857
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Statements of Changes in Net Assets -- (continued)
<TABLE>
<CAPTION>
International Equity
Fund Optimum Growth Fund Value Equity Fund
------------------------- -------------------------- ------------------------
Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended
March 31, March 31, March 31, March 31, March 31, March 31,
2000 1999 2000 1999 2000 1999
------------ ----------- ------------ ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income
(loss)................... $ 123,536 $ 493,722 $ (229,016) $ (27,456) $ 147,525 $ 301,463
Net realized gain on
investments.............. 13,177,380 1,597,388 22,425,776 4,906,503 1,293,913 2,731,686
Net realized loss on
foreign currency
transactions............. (57,016) (44,361) -- -- (2,680) (1,063)
Change in unrealized
appreciation/depreciation
of investments and
foreign currency
translations during the
year..................... 43,802,744 (4,178,241) 3,177,959 35,505,018 15,693,776 (1,255,930)
------------ ----------- ------------ ------------ ----------- -----------
Net increase(decrease)
in net assets resulting
from operations......... 57,046,644 (2,131,492) 25,374,719 40,384,065 17,132,534 1,776,156
Distributions to
Shareholders:
From net investment income
Institutional Shares...... (279,100) (646,625) -- (10,785) (231,511) (276,362)
Shares.................... -- -- -- -- (342) (217)
From net realized gains
Institutional Shares...... (479,188) (1,213,291) (11,457,427) -- (885,998) (3,002,331)
Shares.................... -- -- (2,801,624) -- (1,336) (6,437)
In excess of net realized
gains
Institutional Shares...... -- (508,833) -- -- -- --
------------ ----------- ------------ ------------ ----------- -----------
Total distributions to
shareholders............ (758,288) (2,368,749) (14,259,051) (10,785) (1,119,187) (3,285,347)
------------ ----------- ------------ ------------ ----------- -----------
Transactions in Shares of
Beneficial Interest:
Net proceeds from shares
sold
Institutional Shares...... 46,730,406 66,156,100 18,585,551 16,636,464 5,023,385 6,929,195
Shares.................... -- -- 12,791,975 2,171,420 298,897 46,060
Reinvestment of dividends
Institutional Shares...... -- -- 1,726,809 569 40 --
Shares.................... -- -- 1,662,560 -- 1,355 2,707
Cost of shares redeemed
Institutional Shares...... (57,760,703) (23,290,314) (31,622,549) (15,767,433) (6,315,104) (880,640)
Shares.................... -- -- (6,863,369) (997,974) (138,817) (461)
------------ ----------- ------------ ------------ ----------- -----------
Net increase (decrease)
in net assets from
beneficial interest
transactions............ (11,030,297) 42,865,786 (3,719,023) 2,043,046 (1,130,244) 6,096,861
------------ ----------- ------------ ------------ ----------- -----------
Total Increase in Net
Assets................. 45,258,059 38,365,545 7,396,645 42,416,326 14,883,103 4,587,670
Net Assets:
Beginning of Year......... 78,801,899 40,436,354 100,458,854 58,042,528 39,431,144 34,843,474
------------ ----------- ------------ ------------ ----------- -----------
End of Year(a)............ $124,059,958 $78,801,899 $107,855,499 $100,458,854 $54,314,247 $39,431,144
============ =========== ============ ============ =========== ===========
Capital Share Transactions:
Shares sold:
Institutional Shares...... 4,718,374 7,789,693 663,763 812,340 299,695 466,461
Shares.................... -- -- 454,057 105,092 15,650 3,120
Shares issued for dividend
reinvestment:
Institutional Shares...... -- -- 61,937 35 1 --
Shares.................... -- -- 60,107 -- 72 190
Shares redeemed:
Institutional Shares...... (5,047,602) (2,642,321) (1,135,686) (766,399) (331,276) (59,957)
Shares.................... -- -- (248,560) (56,822) (8,071) (31)
------------ ----------- ------------ ------------ ----------- -----------
Net Increase (Decrease) in
Shares Outstanding........ (329,228) 5,147,372 (144,382) 94,246 (23,929) 409,783
============ =========== ============ ============ =========== ===========
--------
(a) Including
undistributed
(distributions in
excess of) net
investment income..... $ 13,119 $ 28,435 -- -- $ 688 $ 87,696
</TABLE>
See Notes to Financial Statements.
<PAGE>
Excelsior Institutional Trust
Financial Highlights
Selected data for a share outstanding throughout each period are as follows:
<TABLE>
<CAPTION>
Equity Fund
---------------------------------------------------------
Ten Months
Year Ended Year Ended Year Ended Ended Year Ended
March 31, March 31, March 31, March 31, May 31,
2000 1999 1998 1997 (a) 1996
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of
Period........... $ 14.96 $ 12.69 $ 9.65 $ 8.93 $ 7.73
-------- -------- -------- -------- -------
Investment
Operations:
Net investment
income........... 0.02 0.04 0.05 0.05 0.11
Net realized and
unrealized gain
(loss) on
investments...... 3.73 2.47 4.67 0.86 1.20
-------- -------- -------- -------- -------
Total From
Investment
Operations...... 3.75 2.51 4.72 0.91 1.31
-------- -------- -------- -------- -------
Distributions:
From net
investment
income........... (0.03) (0.04) (0.06) (0.07) (0.11)
In excess of net
investment
income........... -- -- -- -- --
From net realized
gains............ (1.20) (0.20) (1.62) (0.12) --
In excess of net
realized gains... -- -- -- -- --
-------- -------- -------- -------- -------
Total
Distributions... (1.23) (0.24) (1.68) (0.19) (0.11)
-------- -------- -------- -------- -------
Net Asset Value,
End of Period.... $ 17.48 $ 14.96 $ 12.69 $ 9.65 $ 8.93
======== ======== ======== ======== =======
Total Return..... 25.75% 20.13% 51.58% 10.22%(c) 17.04%
======== ======== ======== ======== =======
Ratios and
Supplemental
Data:
Ratios to Average
Net Assets
Net Expenses..... 0.70% 0.70% 0.70% 0.70%(d) 0.36%
Gross Expenses
(e).............. 0.90% 0.90% 0.90% 0.92%(d) 1.49%
Net Investment
Income........... 0.13% 0.28% 0.46% 0.70%(d) 1.32%
Portfolio
Turnover......... 27% 37% 26% 32%(d) 113%
Net Assets at end
of Period
(000's omitted).. $211,601 $180,110 $138,328 $118,562 $23,495
<CAPTION>
Income Fund
-----------------------------------------------------------
Ten Months
Year Ended Year Ended Year Ended Ended Year Ended
March 31, March 31, March 31, March 31, May 31,
2000 1999 1998 1997(a) 1996
---------- ------------ ---------- ------------- ----------
<S> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of
Period........... $ 7.00 $ 7.23 $ 6.90 $ 6.99 $ 7.33
---------- ------------ ---------- ------------- ----------
Investment
Operations:
Net investment
income........... 0.41 0.40 0.44 0.38 0.51
Net realized and
unrealized gain
(loss) on
investments...... (0.33) 0.03 0.35 (0.01) (0.27)
---------- ------------ ---------- ------------- ----------
Total From
Investment
Operations...... 0.08 0.43 0.79 0.37 0.24
---------- ------------ ---------- ------------- ----------
Distributions:
From net
investment
income........... (0.41) (0.41) (0.44) (0.38) (0.51)
In excess of net
investment
income........... -- --(b) -- -- --
From net realized
gains............ -- (0.25) (0.02) (0.08) (0.07)
In excess of net
realized gains... (0.01) -- -- -- --
---------- ------------ ---------- ------------- ----------
Total
Distributions... (0.42) (0.66) (0.46) (0.46) (0.58)
---------- ------------ ---------- ------------- ----------
Net Asset Value,
End of Period.... $ 6.66 $ 7.00 $ 7.23 $ 6.90 $ 6.99
========== ============ ========== ============= ==========
Total Return..... 1.16% 5.94% 11.78% 5.39%(c) 3.18%
========== ============ ========== ============= ==========
Ratios and
Supplemental
Data:
Ratios to Average
Net Assets
Net Expenses..... 0.50% 0.50% 0.50% 0.50%(d) 0.26%
Gross Expenses
(e).............. 0.90% 0.91% 0.91% 0.96%(d) 1.35%
Net Investment
Income........... 6.08% 5.57% 6.14% 6.50%(d) 6.99%
Portfolio
Turnover......... 125% 196% 190% 107%(d) 67%
Net Assets at end
of Period
(000's omitted).. $99,209 $67,240 $61,374 $51,082 $24,001
</TABLE>
-----
(a) The Fund changed its fiscal year end to March 31.
(b) Amount represents less than $0.01 per share.
(c) Not annualized
(d) Annualized
(e) Expense ratios before waiver of fees and reimbursement of expenses, if
any, by the adviser and administrators.
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>
Total Return Bond Fund
---------------------------------------------------------
Ten Months
Year Ended Year Ended Year Ended Ended Year Ended
March 31, March 31, March 31, March 31, May 31,
2000 1999 1998 1997(a) 1996
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of
Period........... $ 7.32 $ 7.51 $ 7.16 $ 7.18 $ 7.47
-------- -------- -------- -------- -------
Investment
Operations:
Net investment
income........... 0.41 0.42 0.44 0.37 0.48
Net realized and
unrealized gain
(loss) on
investments...... (0.31) 0.03 0.41 0.01 (0.17)
-------- -------- -------- -------- -------
Total From
Investment
Operations...... 0.10 0.45 0.85 0.38 0.31
-------- -------- -------- -------- -------
Distributions:
From net
investment
income........... (0.41) (0.42) (0.44) (0.37) (0.48)
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... (0.41) (0.64) (0.50) (0.40) (0.60)
-------- -------- -------- -------- -------
Net Asset Value,
End of Period.... $ 7.01 $ 7.32 $ 7.51 $ 7.16 $ 7.18
======== ======== ======== ======== =======
Total Return..... 1.47% 6.07% 12.21% 5.29%(b) 4.20%
======== ======== ======== ======== =======
Ratios and
Supplemental
Data:
Ratios to Average
Net Assets
Net Expenses..... 0.50% 0.50% 0.50% 0.50%(c) 0.32%
Gross
Expenses(d)...... 0.88% 0.89% 0.90% 0.92%(c) 1.33%
Net Investment
Income........... 5.85% 5.53% 5.95% 6.08%(c) 6.47%
Portfolio
Turnover......... 115% 234% 196% 200%(c) 127%
Net Assets at end
of Period
(000's omitted).. $264,671 $251,614 $167,711 $138,402 $65,017
<CAPTION>
International Equity Fund
----------------------------------------------------------
Ten Months
Year Ended Year Ended Year Ended Ended Year Ended
March 31, March 31, March 31, March 31, May 31,
2000 1999 1998 1997(a) 1996
---------- ----------- ---------- ------------- ----------
<S> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of
Period........... $ 8.45 $ 9.67 $ 9.03 $ 8.99 $ 7.88
---------- ----------- ---------- ------------- ----------
Investment
Operations:
Net investment
income........... 0.01 0.16 0.09 0.01 0.09
Net realized and
unrealized gain
(loss) on
investments...... 5.39 (0.79) 0.79 0.21 1.20
---------- ----------- ---------- ------------- ----------
Total From
Investment
Operations...... 5.40 (0.63) 0.88 0.22 1.29
---------- ----------- ---------- ------------- ----------
Distributions:
From net
investment
income........... (0.03) (0.16) (0.07) (0.06) (0.12)
In excess of net
investment
income........... -- -- (0.02) (0.03) --
From net realized
gains............ (0.04) (0.30) (0.15) (0.09) (0.06)
In excess of net
realized gains... -- (0.13) -- -- --
---------- ----------- ---------- ------------- ----------
Total
Distributions... (0.07) (0.59) (0.24) (0.18) (0.18)
---------- ----------- ---------- ------------- ----------
Net Asset Value,
End of Period.... $ 13.78 $ 8.45 $ 9.67 $ 9.03 $ 8.99
========== =========== ========== ============= ==========
Total Return..... 64.29% (6.60)% 9.90% 2.41%(b) 16.58%
========== =========== ========== ============= ==========
Ratios and
Supplemental
Data:
Ratios to Average
Net Assets
Net Expenses..... 0.90% 0.90% 0.90% 0.90%(c) 0.60%
Gross
Expenses(d)...... 1.45% 1.53% 1.43% 1.49%(c) 2.05%
Net Investment
Income........... 0.11% 1.18% 1.05% 0.45%(c) 1.71%
Portfolio
Turnover......... 43% 107% 52% 45%(c) 19%
Net Assets at end
of Period
(000's omitted).. $124,060 $78,802 $40,436 $38,470 $24,522
</TABLE>
-----
(a) The Fund changed its fiscal year end to March 31.
(b) Not annualized
(c) Annualized
(d) Expense ratios before waiver of fees and reimbursement of expenses, if
any, by the adviser and administrators.
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>
Optimum Growth Fund Value Equity Fund
---------------------------------------------- -------------------------------------------
June 1, June 1,
Year Ended Year Ended Year Ended 1996(a) to Year Ended Year Ended Year Ended 1996(a) to
March 31, March 31, March 31, March 31, March 31, March 31, March 31, March 31,
2000 1999 1998 1997 2000 1999 1998 1997
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period..... $ 27.55 $ 16.33 $ 10.19 $ 10.00 $ 15.33 $ 16.12 $ 11.33 $ 10.00
------- ------- ------- ------- ------- ------- ------- -------
Investment Operations:
Net investment income
(loss).................. (0.05) --(b) 0.03 0.05 0.06 0.13 0.11 0.08
Net realized and
unrealized gain on
investments............. 7.21 11.22 6.15 0.17 6.34 0.52 5.59 1.31
------- ------- ------- ------- ------- ------- ------- -------
Total From Investment
Operations............. 7.16 11.22 6.18 0.22 6.40 0.65 5.70 1.39
------- ------- ------- ------- ------- ------- ------- -------
Distributions:
From net investment
income.................. -- --(b) (0.04) (0.03) (0.09) (0.12) (0.11) (0.06)
From net realized gains. (3.88) -- -- -- (0.32) (1.32) (0.80) --
------- ------- ------- ------- ------- ------- ------- -------
Total Distributions.... (3.88) --(b) (0.04) (0.03) (0.41) (1.44) (0.91) (0.06)
------- ------- ------- ------- ------- ------- ------- -------
Net Asset Value, End of
Period.................. $ 30.83 $ 27.55 $ 16.33 $ 10.19 $ 21.32 $ 15.33 $ 16.12 $ 11.33
======= ======= ======= ======= ======= ======= ======= =======
Total Return............ 27.66% 68.74% 60.85% 2.23%(c) 41.92% 4.80% 51.67% 13.91%(c)
======= ======= ======= ======= ======= ======= ======= =======
Ratios and Supplemental
Data:
Ratios to Average Net
Assets
Net Expenses............ 0.80% 0.71% 0.70% 0.70%(e) 0.80% 0.70% 0.70% 0.70%(e)
Gross Expenses(d)....... 0.93% 0.93% 0.97% 1.11%(e) 0.95% 0.97% 1.00% 1.12%(e)
Net Investment Income... (0.18)% 0.00% 0.23% 0.66%(e) 0.31% 0.87% 0.81% 0.94%(e)
Portfolio Turnover...... 44% 22% 19% 20%(e) 45% 55% 51% 64%(e)
Net Assets at end of
Period
(000's omitted)......... $85,889 $88,045 $51,441 $27,183 $53,978 $39,307 $34,766 $23,687
</TABLE>
-----
(a) Commencement of Operations
(b) Amount represents less than $0.01 per share.
(c) Not annualized
(d) Expense ratios before waiver of fees and reimbursement of expenses, if
any, by the adviser and administrators.
(e) Annualized
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 six 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 International Equity Fund ("International Equity Fund"), Excelsior
Optimum Growth Fund ("Optimum Growth Fund") and Excelsior Value Equity Fund
("Value Equity Fund"). With regard to International Equity Fund, Optimum
Growth Fund and Value Equity Fund, the Trust offers two classes of shares:
Institutional Shares and Shares. At March 31, 2000, 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, 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.
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.
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements -- (Continued)
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.
At March 31, 2000, the following Portfolios had approximate capital loss
carryforwards for Federal tax purposes available to offset future net capital
gains through the indicated expiration dates:
<TABLE>
<CAPTION>
Expiration Date
March 31,
2008
---------------
<S> <C>
Income Fund..................................................... 1,377,000
Total Return Bond Fund.......................................... 4,838,000
</TABLE>
To the extent that such carryforwards are utilized, no capital gain
distributions will be made.
Post-October losses are deemed to arise on the first business day of a
Portfolio's next taxable year. International Equity Fund and Value Equity Fund
incurred, and elected to defer, net currency losses of approximately $203,000
and $50 respectively, for the year ended March 31, 2000. In addition, Income
Fund, Total Return Bond Fund and Value Equity Fund incurred, and elected to
defer, net capital losses of approximately $885,000, $3,056,000, and $511,000,
respectively, for the year ended March 31, 2000.
At March 31, 2000, 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 Equity Growth Equity
Fund Fund Fund Fund Fund Fund
------------ ------------ ------------ ------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Aggregate Cost.......... $127,106,968 $100,551,980 $268,024,234 $77,657,165 $45,533,476 $27,881,992
============ ============ ============ =========== =========== ===========
Gross unrealized
appreciation........... $ 90,877,788 $ 521,729 $ 323,920 $50,315,394 $63,032,056 $28,230,348
------------ ------------ ------------ ----------- ----------- -----------
Gross unrealized
depreciation........... (6,828,711) (2,241,230) (6,211,065) (4,715,412) (1,505,968) (1,267,886)
------------ ------------ ------------ ----------- ----------- -----------
Net unrealized
appreciation
(depreciation)......... $ 84,049,077 $ (1,719,501) $ (5,887,145) $45,599,982 $61,526,088 $26,962,462
============ ============ ============ =========== =========== ===========
</TABLE>
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements -- (Continued)
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 (collectively with U.S. Trust NY, "U.S. Trust") serve as the investment
adviser to the Equity Fund, Income Fund, Total Return Bond Fund, International
Equity Fund, Optimum Growth Fund, and Value 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 NY is a state-chartered bank and trust company and a member bank
of the Federal Reserve System. U.S. Trust Company is a Connecticut state bank
and trust company. Each is a wholly-owned subsidiary of U.S. Trust Corporation,
a registered bank holding company.
On January 12, 2000, The Charles Schwab Corporation ("Schwab") and U.S. Trust
Corporation entered into a definitive agreement to merge (the "Merger"). After
the Merger, U.S. Trust Corporation will be a wholly-owned subsidiary of Schwab.
The Merger is subject to the approval of U.S. Trust Corporation shareholders.
The Merger is expected to take place on or about May 31, 2000, but could occur
later.
As a consequence of the Merger and in order to provide continuity of
investment advisory services, the Board of Trustees of the Trust proposed for
the approval of its shareholders a new advisory agreement with U.S. Trust. The
new proposed advisory agreement was submitted to and approved by a vote of the
Trust's shareholders. The election of Trustees for the Trust, as proposed, was
also approved at the meeting for the Trust -- see "Voting Results of Special
Meeting of Shareholders". The new advisory agreements will become effective on
the date of the Merger.
b) U.S. Trust Company, 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, 2000, administration
fees charged by U.S. Trust Company were as follows:
<TABLE>
<S> <C>
Equity Fund........................................................... $ 83,956
Income Fund........................................................... $ 35,100
Total Return Bond Fund................................................ $115,493
International Equity Fund............................................. $ 94,735
Optimum Growth Fund................................................... $ 43,955
Value Equity Fund..................................................... $ 20,761
</TABLE>
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements -- (Continued)
c) From time to time, as they may deem appropriate in their sole discretion,
U.S. Trust 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 expenses. For the period from April 1, 1999 through November 18, 1999,
U.S. Trust voluntarily waived fees and reimbursed expenses to the extent
necessary to keep total operating expenses from exceeding certain annual
percentages of each Fund's average daily net assets as specified below.
Beginning November 19, 1999, U.S. Trust contractually agreed to waive
investment advisory fees and to reimburse other ordinary operating expenses
through March 31, 2000 to the extent necessary to keep total operating
expenses from exceeding these annual percentages. U.S. Trust has extended this
contractual agreement through the fiscal year ended March 31, 2001.
<TABLE>
<S> <C>
Equity Fund.............................................................. 0.70%
Income Fund.............................................................. 0.50%
Total Return Bond Fund................................................... 0.50%
International Equity Fund -- Institutional Shares........................ 0.90%
Optimum Growth Fund -- Institutional Shares.............................. 0.80%
Value Equity Fund -- Institutional Shares................................ 0.80%
Optimum Growth Fund--Shares.............................................. 1.05%
Value Equity Fund--Shares................................................ 1.05%
</TABLE>
For the year ended March 31, 2000, U.S. Trust waived investment advisory fees
in the following amounts:
<TABLE>
<S> <C>
Equity Fund......................................................... $ 386,474
Income Fund......................................................... $ 324,481
Total Return Bond Fund.............................................. $1,016,516
International Equity Fund........................................... $ 600,158
Optimum Growth Fund................................................. $ 121,458
Value Equity Fund................................................... $ 71,673
</TABLE>
d) The Trust, on behalf of the Funds, has entered 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 organization 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 organizations' customers. Such
services may include assisting in processing purchase, exchange or redemption
requests; transmitting and receiving funds in connection with customers orders
to purchase, exchange or redeem shares; and providing periodic statements.
Through the year ended March 31, 2000, U.S. Trust and the Administrators
voluntarily agreed to waive investment advisory and administration fees
payable by each Fund in an amount equal to the administrative service fees
expense (including fees paid to affiliates of U.S. Trust) by such Fund. They
will continue to do so through July 31, 2000. Effective August 1, 2000, U.S.
Trust has voluntarily agreed to continue waiving investment advisor and
administration fees payable by each Fund in an amount equal to the
administrative services fees expense paid to subsidiaries of U.S. Trust
Corporation. For the year ended March 31, 2000, U.S. Trust and the
Administrators waived investment advisory and administration fees in amounts
equal to the administrative service fees for the Funds as follows:
<TABLE>
<CAPTION>
U.S. Trust Administrators
---------- --------------
<S> <C> <C>
Optimum Growth Fund................................... $12,241 $1,545
</TABLE>
<PAGE>
Excelsior Institutional Trust
Notes to Financial Statements -- (Continued)
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 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
0.25% of the average daily net asset value of each 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.
Effective March 3, 2000, each Trustee serving on the Nominating Committee of
the Trust also receives an annual fee of $1,000 for services in connection
with this committee. Effective as of the same date the Chairman of the Board
receives an additional annual fee of $5,000 for services in this capacity.
3. Purchases and Sales of Investment Securities:
a) Investment transactions (excluding short-term investments) for the year
ended March 31, 2000 were as follows:
<TABLE>
<CAPTION>
Cost of Proceeds
Purchases From Sales
------------ ------------
<S> <C> <C>
Equity Fund.......................................... $ 51,665,880 $ 68,790,874
Income Fund.......................................... $135,086,702 $ 96,453,373
Total Return Bond Fund............................... $330,281,021 $286,778,519
International Equity Fund............................ $ 44,968,896 $ 58,128,646
Optimum Growth Fund.................................. $ 44,134,756 $ 61,093,240
Value Equity Fund.................................... $ 21,063,778 $ 22,909,314
</TABLE>
b) Investment transactions in U.S. Government and Agency Obligations
(excluding short-term investments) for the year ended March 31, 2000 were as
follows:
<TABLE>
<CAPTION>
Cost of Proceeds
Purchases From Sales
------------ ------------
<S> <C> <C>
Income Fund........................................... $ 89,374,445 $ 52,772,180
Total Return Bond Fund................................ $181,163,598 $173,419,776
</TABLE>
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 up to 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, 2000, the Portfolios had no
borrowings under the agreement.
<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 Equity, Excelsior
Income, Excelsior Total Return Bond, Excelsior International Equity, Excelsior
Optimum Growth, and Excelsior Value Equity Funds (the six portfolios
constituting the Excelsior Institutional Trust) (the "Trust") as of March 31,
2000, and the related statements of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period
then ended 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 auditing standards generally
accepted in the United States. 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 and financial highlights. Our procedures included
confirmation of securities owned as of March 31, 2000, by correspondence with
the custodian and brokers or by 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
Excelsior Equity, Excelsior Income, Excelsior Total Return Bond, Excelsior
International Equity, Excelsior Optimum Growth, and Excelsior Value Equity
Funds at March 31, 2000, the results of their operations for the year then
ended, the changes in their net assets for each of the two years in the period
then ended and the financial highlights for the periods indicated therein, in
conformity with accounting principles generally accepted in the United States.
/s/ Ernst & Young LLP
Boston, Massachusetts
May 24, 2000
<PAGE>
Federal Tax Information (Unaudited):
For the year ended March 31, 2000, 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......................... 20.59% $11,721,000 -- --
Income Fund......................... -- 11,000 -- 28.14%
Total Return Bond Fund ............. -- -- $120,000 36.88%
International Equity Fund........... -- 479,000 -- --
Optimum Growth Fund................. -- 14,259,000 -- 11.56%
Value Equity Fund................... 30.54% 16,000 -- --
</TABLE>
In addition, for the year ended March 31, 2000, gross income derived from
sources within foreign countries for the International Equity Fund
approximately amounted to $1,041,700.
<PAGE>
Voting Results of Special Meetings of Shareholders: (Unaudited)
The proposals described below were submitted to a vote of shareholders of the
Trust at a special meeting of shareholders held on May 3, 2000 and a subsequent
meeting held on May 19, 2000 with regard to Income Fund (the "Meetings"):
Proposal No. 1 -- To elect Messrs. Wonham, Tannachion, Campbell, Dugan,
Frankl, Robinson, Drake and Piel as trustees:
At the Meetings the shareholders of the Trust approved Proposal No. 1 as
follows:
<TABLE>
<CAPTION>
For Against Abstain
---------- ------- -------
<S> <C> <C>
43,808,516 538 89,706
</TABLE>
Proposal No. 2 -- Approval of a new investment advisory agreement between the
Funds and U.S. Trust:
At the Meetings the shareholders of each Fund approved Proposal No. 2 as
follows:
<TABLE>
<CAPTION>
Portfolio For Against Abstain
--------- ---------- ------- -------
<S> <C> <C> <C>
Equity Fund.......................................... 8,530,759 -- 69,954
Income Fund.......................................... 13,134,305 634,949 643,019
Total Return Bond Fund............................... 23,475,213 -- --
International Equity................................. 5,853,506 -- --
Optimum Growth Fund.................................. 3,378,334 538 19,710
Value Equity Fund.................................... 2,570,704 -- 42
</TABLE>
