EQUITY PORTFOLIO/NY, N-30B-2, 1995-03-09

EQUITY PORTFOLIO/NY
N-30B-2, 1995-03-09

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<PAGE>

Issuer Shares Value
- - --------------------------------------------------------------------------------
COMMON STOCKS--82.3%
- - --------------------------------------------------------------------------------

COMMODITIES - 5.1 %
Lubrizol Corp. ................................. 83,000 $ 2,811,625
Nucor Corp. .................................... 49,800 2,763,900
Praxair Inc. ................................... 195,000 3,997,500
-----------
9,573,025
-----------
CYCLICALS - DURABLES - 4.4%
Cooper Tire & Rubber Co. ....................... 13,800 326,025
Ford Motor Co. ................................. 113,000 3,164,000
General Motors Corp. ........................... 112,500 4,753,125
-----------
8,243,150
-----------
CYCLICALS - NON DURABLES - 2.1%
Eastman Kodak Co. .............................. 81,000 3,867,750
-----------

ELECTRONICS - 7.6%
Emerson Electric Co. ........................... 47,000 2,937,500
General Electric Co. ........................... 89,000 4,539,000
Hewlett Packard Co. ............................ 25,000 2,496,875
Texas Instruments Inc. ......................... 55,700 4,170,537
-----------
14,143,912
-----------
ENERGY - 5.2%
Royal Dutch Petroleum Co. ......................
ADR's ......................................... 42,000 4,515,000
Schlumberger LTD ............................... 28,200 1,420,575
Unocal Corp. ................................... 140,000 3,815,000
-----------
9,750,575
-----------
ENTERTAINMENT/MEDIA - 2.6%
Carnival Corp. ................................. 29,500 626,875
Gaylord Entertainment Co. ...................... 113,000 2,570,750
Tele-Communications Inc. Class "A" ............. 80,000 1,740,000
-----------
4,937,625
-----------

FINANCE BANKS - 4.5%
BankAmerica Corp................................ 60,000 2,370,000
First Fidelity Bancorp ......................... 67,500 3,029,063
Signet Banking Corp. ........................... 102,000 2,919,750
-----------
8,318,813
-----------

Issuer Shares Value
- - --------------------------------------------------------------------------------

FINANCE - NON BANKS - 8.7%
American International Group Inc. .................... 35,000 $3,430,000
Asia Tigers Fund ..................................... 37,700 353,438
Avalon Properties Inc. ............................... 99,500 2,288,500
Chile Fund ........................................... 15,800 728,775
Emerging Germany Fund Inc. ........................... 30,800 227,150
Emerging Tiger Fund Inc. ............................. 43,800 498,225
Federal National
Mortgage Association ................................ 45,000 3,279,375
First Australia Fund Inc. ............................ 11,400 101,175
France Growth Fund ................................... 17,900 163,338
Future Germany Fund .................................. 15,600 224,250
Irish Investment Fund Inc. ........................... 4,700 40,538
Malaysia Fund ........................................ 26,500 457,125
Pakistan Investment Fund ............................. 45,500 409,500
Thai Capital Fund .................................... 24,700 410,637
The India Fund, Inc. ................................. 56,200 597,125
The New Germany Fund ................................. 38,100 438,150
The Thai Fund Inc. ................................... 18,500 413,937
Travelers Inc. ....................................... 60,000 1,950,000
United Kingdom Fund Inc. ............................. 21,500 233,812
----------
16,245,050
----------
GROWTH STAPLES - 5.5%
McDonald's Corp. ..................................... 112,000 3,276,000
PepsiCo Inc. ......................................... 96,000 3,480,000
Sysco Corp. .......................................... 140,000 3,605,000
----------
10,361,000
----------
HEALTH CARE - 7.5%
Coastal Healthcare Group ............................. 63,400 1,735,575
Community Health Systems ............................. 44,500 1,212,625
FHP Group ............................................ 63,000 1,622,250
Johnson& Johnson ..................................... 63,000 3,449,250
Pfizer Inc. .......................................... 47,500 3,669,375
United Health Care Co. ............................... 13,500 609,188
Value Health Inc. .................................... 44,000 1,639,000
----------
13,937,263
----------

<PAGE>
- - --------------------------------------------------------------------------------
Equity Portfolio
- - --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS December 31, 1994 continued
- - --------------------------------------------------------------------------------

Issuer Shares Value
- - --------------------------------------------------------------------------------

INFORMATION PROCESSING - 12.3%
American Telephone &
Telegraph Co. ........................... 81,192 $ 4,079,898
Cisco Systems, Inc. ........................ 80,000 2,810,000
DSC Communications ......................... 56,000 2,009,000
General Motors Corp. Class "E" ............. 125,000 4,812,500
Silicon Graphics Inc.* ..................... 70,000 2,161,250
Stratus Computer Inc.* ..................... 85,000 3,230,000
Xerox Corp ................................. 38,300 3,791,700
-----------
22,894,348
-----------
MACHINERY - 5.2%
Cooper Industries Inc. ..................... 59,000 2,013,375
Deere & Co. ................................ 40,000 2,650,000
Fluor Corp. ................................ 62,000 2,673,750
WMX Technologies Inc. ...................... 92,000 2,415,000
-----------
9,752,125
-----------
RETAIL SALES - 6.1%
Home Depot Inc. ............................ 65,000 2,990,000
Limited Inc. ............................... 75,000 1,359,375
May Department Stores Co. .................. 75,000 2,531,250
Toys "R" Us Inc.* .......................... 97,000 2,958,500
Wal-Mart Stores Inc. ....................... 70,000 1,487,500
-----------
11,326,625
-----------
TRANSPORTATION - 3.4%
Consolidated Rail Inc. ..................... 53,000 2,676,500
Norfolk Southern Co. ....................... 62,000 3,758,750
-----------
6,435,250
-----------
UTILITIES - 2.1 %
FPL Group Inc. ............................. 50,000 1,756,250
Telefonos de Mexico ADRs ................... 51,400 2,107,400
-----------
3,863,650
-----------

TOTAL COMMON STOCK
(Identified Cost $148,175,348) ............ 153,650,161
-----------

Principal
Issuer Amount Value
- - --------------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS--20.6%
- - --------------------------------------------------------------------------------
Salomon Brothers Repurchase Agreement
6.00 %, due 1/03/95,
proceeds at maturity $38,540,677 ............$38,515,000 $ 38,515,000
-------------
(secured by $43,061,000
U.S. Treasury Note 4.75%
due 9/30/98)
TOTAL INVESTMENTS ............................. 102.9% 192,165,161
(Identified Cost $186,690,348)
OTHER ASSETS,
LESS LIABILITIES ............................. (2.9%) (5,479,677)
----- -------------
NET ASSETS .................................... 100.0% $ 186,685,484
===== =============

*Non-income producing security.

See notes to financial statements

<PAGE>

ASSETS:
Investments at value (Note 1A) (Identified Cost, 186,690,348) .. $ 192,165,161
Cash ........................................................... 222
Receivable for investments sold ................................ 594,799
Dividends and interest receivable .............................. 467,533
-------------
Total assets ............................................... 193,227,715
-------------

LIABILITIES:
Payable for investments purchased .............................. 6,447,049
Payable to affiliates--Investment advisory fee (Note 2) ........ 78,401
Accrued expenses and other liabilities ......................... 16,781
-------------
Total liabilities .......................................... 6,542,231
-------------
NET ASSETS ..................................................... $ 186,685,484
=============

REPRESENTED BY:
Paid-in capital for beneficial interests ....................... $ 186,685,484
=============

See notes to financial statements

<PAGE>

- - --------------------------------------------------------------------------------
Equity Portfolio
- - --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
For the Period May 1, 1994 (Commencement of Operations) to December 31, 1994
- - --------------------------------------------------------------------------------
<TABLE>

<S> <C> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding tax of $39,717) ................ $2,505,018
Interest ............................................................. 585,374
----------
Total Income ....................................................... $3,090,392

EXPENSES:
Investment advisory fees (Note 2) .................................... 639,988
Administrative fees (Note 3) ......................................... 63,999
Expense reimbursement fees (Note 6) .................................. 63,938
----------
Total expenses ..................................................... 767,925
----------
Net investment income .............................................. 2,322,467
----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from investment transactions ................ 2,731,272
Unrealized appreciation (depreciation) of investments--
Beginning of period ............................................... ---
End of period ..................................................... 5,474,813
Less unrealized appreciation acquired in connection with
Landmark Equity Fund contribution (Note 1) ........................ (6,318,828)
----------
Net change in unrealized appreciation (depreciation) ................ (844,015)
----------
Net realized and unrealized gain (loss) on investments ............ 1,887,257
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ................. $4,209,724
==========
</TABLE>

See notes to financial statements

<PAGE>

<S> <C>
INCREASE (DECREASE) IN NET ASSETS FROM:
Operations:
Net investment income ............................................. $ 2,322,467
Net realized gain on investment transactions ...................... 2,731,272
Net change in unrealized appreciation (depreciation) of investments (844,015)
-------------
Net increase in net assets resulting from operations .......... 4,209,724
-------------

CAPITAL TRANSACTIONS:
Proceeds from contributions ....................................... 199,044,676
Value of withdrawals .............................................. (16,568,916)
-------------
Net increase (decrease) in net assets from capital transactions 182,475,760
-------------

NET INCREASE (DECREASE) IN NET ASSETS: ............................ 186,685,484
Net Assets:
Beginning of period ............................................... --
-------------
End of period ..................................................... $ 186,685,484
=============
</TABLE>

- - --------------------------------------------------------------------------------
Equity Portfolio
- - --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- - --------------------------------------------------------------------------------
May 1, 1994
(Commencement
of Operations) to
December 31, 1994
---------------
RATIOS/SUPPLEMENTAL DATA:
Net Assets, end of period (000 omitted) .......................... $186,685
Ratio of expenses to average net assets .......................... 0.60%*
Ratio of net investment income to average net assets ............. 1.81%*
Portfolio turnover ............................................... 35%

* Annualized

See notes to financial statements

<PAGE>

(1) SIGNIFICANT ACCOUNTING POLICIES

Equity Portfolio (the "Portfolio"), a separate series of The Premium Portfolios
(the "Portfolio Trust"), is registered under the Investment Company Act of 1940,
as amended, as a diversified, open-end management investment company which was
organized as a trust under the laws of the State of New York. The Declaration of
Trust permits the Trustees to issue beneficial interests in the Portfolio. The
Investment Adviser of the Portfolio is Citibank N.A. (Citibank"). Signature
Financial Group (Grand Cayman), Ltd. ("SFG") acts as the Portfolio's
Administrator. On May 1, 1994 (commencement of operations of the Portfolio) the
Landmark Equity Fund transferred all of its investable assets ($191,734,923
including $6,318,828 of unrealized appreciation) to the Portfolio in exchange
for an interest in the Portfolio.

The significant accounting policies consistently followed by the Portfolio are
in conformity with generally accepted accounting principles and are as follows:

A. INVESTMENT SECURITY VALUATIONS -- Equity securities listed on securities
exchanges or reported through the NASDAQ system are valued at last sale prices.
Unlisted securities or listed securities for which last sales prices are not
available are valued at last quoted bid prices. Debt securities (other than
short-term obligations maturing in sixty days or less), are valued on the basis
of valuations furnished by pricing services which take into account appropriate
factors such as institutional-size trading in similar groups of securities,
yield, quality, coupon rate, maturity, type of issue, and other market data,
without exclusive reliance on quoted prices or exchange or over-the-counter
prices, since such valuations are believed to reflect more accurately the fair
value of the securities. Short-term obligations, maturing in sixty days or less,
are valued at amortized cost, which approximates market value. Securities, if
any, for which there are no such valuations or quotations are valued at fair
value as determined in good faith by or under guidelines established by the
Trustees.

B. INCOME -- Interest income consists of interest accrued and discount earned,
adjusted for amortization of premium or discount on long-term debt securities
when required for U.S. federal income tax purposes. Dividend income is recorded
on the ex-dividend date.

C. U.S. FEDERAL INCOME TAXES -- The Portfolio is considered a partnership under
the U.S. Internal Revenue Code. Accordingly, no provision for federal income
taxes is necessary.

D. REPURCHASE AGREEMENTS -- It is the policy of the Portfolio to require the
custodian bank to take possession, to have legally segregated in the Federal
Reserve Book Entry System or to have segregated within the custodian bank's
vault, all securities held as collateral in support of repurchase agreement
investments. Additionally, procedures have been established by the Portfolio to
monitor, on a daily basis, the market value of the repurchase agreement's
underlying investments to ensure the existence of a proper level of collateral.

E. EXPENSES -- The Portfolio bears all costs of its operations other than
expenses specifically assumed by Citibank and SFG. Expenses incurred by the
Portfolio Trust with respect to any two or more portfolios or series are
allocated in proportion to the average net assets of each portfolio, except when
allocations of direct expenses to each portfolio can otherwise be made fairly.
Expenses directly attributable to a portfolio are charged to that portfolio.

F. OTHER -- Investment transactions are accounted for on the date the
investments are purchased or sold. Realized gains and losses are determined on
the identified cost basis.

(2) INVESTMENT ADVISORY FEES

The investment advisory fee paid to Citibank, as compensation for overall
investment management services, amounted to $639,988 for the period May 1, 1994
(Commencement of Operations) to December 31, 1994. The investment advisory fee
is computed at the annual rate of 0.50% of the Portfolio's average daily net
assets.

(3) ADMINISTRATIVE FEE

Under the terms of an Administrative Services Agreement, the administrative fee

<PAGE>
- - --------------------------------------------------------------------------------
Equity Portfolio
- - --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS continued
- - --------------------------------------------------------------------------------

paid to the Administrator, as compensation for overall administrative services
and general office facilities, is computed at an annual rate of 0.05% of the
Portfolio's average daily net assets. The administrative fee amounted to $63,999
for the period May 1, 1994 (commencement of operations) to December 31, 1994.
Citibank acts as Sub-Administrator and performs such duties and receives such
compensation from SFG as from time to time is agreed to by SFG and Citibank. The
Portfolio pays no compensation directly to any Trustee or any officer who is
affiliated with the Administrator, all of whom receive remuneration for their
services to the Portfolio from the Administrator or its affiliates. Certain of
the officers and a Trustee of the Portfolio are officers or directors of the
Administrator or its affiliates.

(4) PURCHASES AND SALES OF INVESTMENTS

Purchases and sales of investments, other than short-term obligations,
aggregated $60,111,839 and $78,476,934, respectively, for the period May 1, 1994
(commencement of operations) to December 31, 1994

(5) FEDERAL INCOME TAX BASIS OF INVESTMENTS

The cost and unrealized appreciation (depreciation) in value of the investment
securities owned at December 31, 1994, as computed on a federal income tax
basis, are as follows:

Aggregate cost ............................. $186,690,348
============
Gross unrealized appreciation .............. $ 11,848,166
Gross unrealized depreciation .............. (6,373,353)
------------
Net unrealized appreciation ................ $ 5,474,813
============

(6) EXPENSE REIMBURSEMENT FEES

SFG has entered into an expense reimbursement agreement with the Portfolio. SFG
has agreed to pay all of the ordinary operating expenses (excluding interest,
taxes, brokerage commissions, litigation costs or other extraordinary costs or
expenses) of the Portfolio, other than fees paid under the Advisory Agreement
and Administrative Services Agreement. The Agreement shall terminate on April
30, 2004, unless sooner terminated by either party upon not less than 30 days
nor more than a 60 days written notice to the other party.

The Portfolio has agreed to pay SFG an expense reimbursement fee from the
Portfolio, in addition to the administrative fee, accrued daily and paid
monthly; provided, however, that such fee shall not exceed the amount such that
immediately after any such payment the aggregate ordinary expenses of the
Portfolio would, on an annual basis, exceed an agreed upon rate, currently 0.60%
of average daily net assets.

(7) LINE OF CREDIT

As of May 1, 1994 the Portfolio, along with the other Landmark Funds, entered
into an agreement with a bank which allows the Funds collectively to borrow up
to $40 million for temporary or emergency purposes. Interest on the borrowings,
if any, is charged to the specific fund executing the borrowing at the base rate
of the bank. In addition, the $15 million committed portion of the line of
credit requires a quarterly payment of a commitment fee based on the average
daily unused portion of the line of credit. For the period May 1, 1994
(commencement of operations) to December 31, 1994, the commitment fee allocated
to the Portfolio was $837. Since the line of credit was established, there have
been no borrowings.

<PAGE>

TO THE TRUSTEES AND THE INVESTORS OF THE PREMIUM PORTFOLIOS (THE TRUST), WITH
RESPECT TO ITS SERIES, EQUITY PORTFOLIO:

We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments, of Equity Portfolio (the "Portfolio"), a
series of The Premium Portfolios, as at December 31, 1994 and the related
statements of operations and of changes in net assets and the financial
highlights for the period May 1, 1994 (Commencement of Operations) to December
31, 1994. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of the Portfolio's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.

We conducted our audit in accordance with U.S. generally accepted auditing
standards. Those standards require that we plan and perform an audit to obtain
reasonable assurance whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit, which included confirmation of investments owned at
December 31, 1994, by correspondence with the custodian and brokers and the
application of alternative auditing procedures where confirmations from brokers
were not received, provides a reasonable basis for our opinion.

In our opinion, these financial statements present fairly, in all material
respects, the financial position of the Portfolio as at December 31, 1994, the
results of its operations and the changes in its net assets and the financial
highlights for the period May 1, 1994 (Commencement of Operations) to December
31, 1994 in accordance with U.S. generally accepted accounting principles.

PRICE WATERHOUSE
Chartered Accountants
Toronto, Ontario
February 3, 1995