<PAGE> 1
NATIONS
- ------ FUND --
SEMI
ANNUAL
For the Period Ended September 30, 1995
REPORT
NATIONS EMERGING
MARKETS FUND
NATIONS PACIFIC
GROWTH FUND
NATIONS GLOBAL
GOVERNMENT INCOME FUND
<PAGE> 2
<TABLE>
<S> <C>
- ----------------------------------------------------------------------------
NOT MAY LOSE VALUE
FDIC -
INSURED NO BANK GUARANTEE
- ----------------------------------------------------------------------------
</TABLE>
Nations Fund Distributor: Stephens Inc. Stephens Inc., which is not affiliated
with NationsBank, is not a bank and securities offered by it are not guaranteed
by any bank or insured by the FDIC.
Stephens Inc., member NYSE-SIPC.
Nations Fund Investment Adviser: NationsBank, N.A. ("NationsBank")
Nations Fund Portfolios, Inc. Investment Sub-Adviser: Nations Gartmore
Investment Management
<PAGE> 3
NATIONS FUND PORTFOLIOS, INC.
DEAR SHAREHOLDER:
In early 1995, global markets were unsettled by the fear that U.S.
short-term interest rates would be raised to counter inflationary pressures
building in the U.S. economy. However, the U.S. Federal Reserve Board's (the
"Fed") policy of incremental interest rate increases, which had begun in the
spring of 1994, eventually resulted in U.S. economic growth decelerating to
non-inflationary levels. The perception that followed was that the U.S. economy
could be entering a period of steady growth and low inflation. As a result, the
second quarter saw rallies in both global bonds and equities, with the exception
of Japan. The Japanese economy continued to suffer from the effects of an overly
strong currency, exacerbated by the lack of consumer spending, resulting in
part, from the Kobe earthquake and Tokyo subway gas attacks.
Moving into the third quarter of 1995, U.S. equities continued to
experience what appeared to be an almost unstoppable rise. U.S. Treasury
securities proved to be more volatile, although their yields ended the quarter
unchanged from levels at the quarter's start. The U.K. markets, which were
depressed by the surprise resignation of Prime Minister John Major at the end of
the second quarter, rebounded following his successful re-election as
Conservative Party leader. Continental European markets, which were sensitive to
a rising dollar, also rose. In the Pacific Rim, markets were lackluster, despite
strong economic growth. Taiwan was adversely affected by hostile noises from
Beijing. Thailand and Malaysia continued to run high current account deficits,
although most of the balance was the result of importing capital and
intermediate goods.
Looking forward, our overall themes are as follows: We are optimistic on
U.K. and Continental European bonds with longer maturities. The outlook for the
Japanese economy remains less optimistic, even though investors responded
positively to the perception that Japanese authorities had finally taken the
necessary steps to address the deflationary threat besieging their economy. In
terms of the emerging and Pacific Basin markets, we are cautious about Latin
America over the short term, and favor the Pacific Basin as we believe countries
in this region offer solid economic and earnings growth potential.
The key question remains: Where is the current global economic cycle
headed? Are we now experiencing a period of sustainable non-inflationary
economic growth or is inflation or a recession about to emerge? We believe the
world's major economies are entering a period of prolonged moderate growth.
Therefore, overall, we remain positive on both the international stock and bond
markets and continue to believe they offer opportunities not found in the
domestic markets.
We hope this information proves valuable in the development of your
investment strategy. We look forward to continuing to help you pursue your
investment goals.
Sincerely,
[LOGO]
A. Max Walker
President and Chairman of the Board
September 30, 1995
1
<PAGE> 4
THE NATIONS FUND FAMILY -- A BROAD SPECTRUM OF
ACTIVELY MANAGED INVESTMENT PORTFOLIOS
Nations Fund portfolios span the risk/reward spectrum providing investors
with the ability to pursue a wide range of objectives within a single fund
family. Stock, bond and money market portfolios allow investors to pursue
short-, intermediate-, and long-term investment goals ranging from preservation
of principal to capital accumulation.*
[CHART SHOWING ASSET ALLOCATION OF FUNDS]
* Mutual fund investment returns will fluctuate with market conditions so that
shares, when redeemed, may be worth more or less than original cost. Money
market instruments are neither insured nor guaranteed by the U.S. government.
While money market funds strive to maintain a constant $1.00 per share, there
can be no assurance that the funds will be able to maintain a stable net
asset value.
2
<PAGE> 5
NATIONS EMERGING MARKETS FUND
PERFORMANCE AND COMMENTARY
- --------------------------------------------------------------------------------
PORTFOLIO MANAGER
Andrew Fleming is the Chief Investment Officer for Nations Gartmore Investment
Management and head of the emerging markets team. Andrew has spent all of his
investment career in international investments. He joined London-based Gartmore
plc, the holding company for Gartmore Capital Management, in 1984 as an analyst
and fund manager, specializing in Europe. In 1986, Andrew joined the Far East
team and, in 1993, was promoted to head the team. He is a graduate of the
University of York, England.
INVESTMENT OBJECTIVE
Nations Emerging Markets Fund's investment objective is to seek long-term
capital growth. It seeks to achieve this objective by investing primarily in
securities of companies that conduct their principal business activities in
emerging markets. The Fund invests primarily in companies located in countries
considered to have the potential for rapid economic growth and that have a
relatively low gross national product per capita compared to the world's major
economies.
- --------------------------------------------------------------------------------
PERFORMANCE REVIEW
Nations Emerging Markets Fund commenced operations on June 30, 1995, and
therefore, reports only for the three-month period ended September 30, 1995.
Since the Fund's inception, activity has concentrated on carefully establishing
positions. During the period under review, emerging stock markets performed
relatively poorly, which contributed to the Fund's aggregate total return of
(1.20)%.* This underperformed the (0.34)% return provided by the Fund's
benchmark, the International Finance Corporation (IFC) Investables Composite
Index, mostly due to the steps taken to establish the initial portfolio. The IFC
is a division of the World Bank which tracks more than 1,400 stocks in 25
emerging markets in Asia, Latin America, eastern Europe, Africa and the Middle
East.
MANAGER COMMENTARY
LET'S START WITH LATIN AMERICA. HOW DID KEY COUNTRIES PERFORM?
The best-performing market for the period was Brazil, where measures to
slow the economy have proven quite successful. The Mexican market rose strongly
over the start of the reporting period, continuing the recovery from the first
quarter of the year following the peso devaluation crisis of late 1994. However,
the Mexican market fell back in September as it became clearer that the economy
would improve far more slowly than anticipated.
WHAT HAPPENED IN ASIA?
Tight monetary policies have taken their toll on the equity markets over
the past three months, with Thailand, Malaysia and the Philippines turning in
poor performances. Central banks in these countries have been curbing credit and
loan growth to counter the growing threat of both economic overexpansion and
inflation. Also, a turn for the worse in China-Taiwan relations undermined
investor sentiment, driving foreign funds and domestic institutions away. The
rush for the door resulted in a fall of more than 6% in the value of the Taiwan
dollar, relative to the U.S. dollar.
- ---------------
* Trust A Shares total return.
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS. INVESTMENT RETURNS AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT AN
INVESTOR'S SHARES MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST UPON
REDEMPTION.
3
<PAGE> 6
WHAT EFFECT DID EVENTS IN THESE REGIONS HAVE ON THE FUND'S PERFORMANCE?
The Fund had a larger position in Brazil than its comparable index, and,
therefore, benefited from that market's outperformance. The underweight position
in Mexico had a mostly neutral effect. The Fund was most negatively affected by
its heavier weighting in Pacific Basin countries.
WHAT WERE SOME COMPANIES IN THE PORTFOLIO THAT PERFORMED ESPECIALLY WELL?**
A specific stock worth mentioning is a Brazilian company, Vale Rio Doce,
(VRD), the world's largest producer of iron ore and a major producer of other
metals. VRD has a low level of debt and strong U.S. dollar cash flows. It is
expected to be one of Brazil's next privatizations, which should boost interest
in the stock. Telekom Malaysia (in Malaysia) also looks attractive. It is the
country's prime provider of voice telephone services and operates a nationwide
mobile telephone network.
WHAT IS YOUR GENERAL OUTLOOK FOR EMERGING MARKETS?
Generally, we expect continued volatility for the emerging markets,
specifically Latin America. This supports our policy of broadly diversifying the
Fund's portfolio across many securities and markets that should benefit from the
longer-term opportunities in developing and emerging economies.
WHERE ARE THOSE OPPORTUNITIES?
In Latin America, we continue to like Brazil and the Fund will remain
overweight there. In the Pacific Rim, we will continue to add to the favored
markets of South Korea and Taiwan. Following underperformance in South Korean
and Taiwanese equities in the first half of the year, we expect interest rates
to decline given the current stage of the economic cycle and long-term financial
deregulation. Thus, we expect potentially stronger relative performance.
WHAT MARKETS LOOK LESS FAVORABLE?
Mexico. A meaningful economic recovery is not likely to commence until well
into 1996, so the Fund will retain relatively low exposure there. South Africa
is not a diversified economy, dominated as it is by only one or two major
industries. Therefore, the Fund will continue to have a smaller position there,
at around 10%, against the 23% weighting in the IFC Investables Composite Index.
- ---------------
** Portfolio holdings are subject to change and may not be representative of
the Fund's current holdings.
4
<PAGE> 7
NATIONS PACIFIC GROWTH FUND
PERFORMANCE AND COMMENTARY
- --------------------------------------------------------------------------------
PORTFOLIO MANAGER
Seok Teoh is the investment manager on the Far East team for Nations Gartmore
Investment Management, which currently manages over $2 billion in Pacific Basin
equities. Previously, Seok managed Far East equities for Rothschild Asset
Management in Tokyo and in Singapore. She was also responsible for Singaporean
and Malaysian equity sales at Overseas Union Bank Securities in Singapore. Seok
graduated from the University of Durham.
INVESTMENT OBJECTIVE
Nations Pacific Growth Fund's investment objective is to seek long-term capital
growth, with income a secondary consideration. It seeks to achieve this
objective by investing primarily in securities of issuers that conduct their
principal business activities in the Pacific Basin and the Far East (excluding
Japan).
- --------------------------------------------------------------------------------
PERFORMANCE REVIEW
Nations Pacific Growth Fund commenced operations on June 30, 1995, and
therefore, reports only for the three-month period ended September 30, 1995.
Since the Fund's inception, activity has concentrated on establishing positions.
During the period under review, the Pacific Basin equity markets produced
lackluster performance which was reflected in the Fund's aggregate total return
of (2.90)%.* This return underperformed the (2.00)% return provided by the
Fund's benchmark, the Morgan Stanley Capital International Combined Far East
ex-Japan Free Index.
MANAGER COMMENTARY
PLEASE DESCRIBE MARKET CONDITIONS THAT PREVAILED DURING THE PERIOD.
For the three-month period under review, the Pacific Basin equity markets
overall performed poorly, due to a variety of factors. In Thailand, consumer and
wholesale price inflation was running at very high levels, the latter putting
pressure on factory prices and the margins of manufacturing companies. In
addition, political concerns about the make-up of the ruling coalition resulted
in heavy selling by local funds. Tight monetary policies in Malaysia and the
Philippines took their toll on the equity markets, particularly in financial and
property stocks in the former and large-capitalization stocks in the latter.
WHAT ABOUT TAIWAN, DIDN'T POLITICAL PROBLEMS AFFECT THE MARKETS THERE?
In Taiwan, the market was weak due to a combination of political worries
and domestic financial scandal. Investors were unnerved by China's test firing
of guided missiles some 70 miles off the Taiwanese coast. Later, a turn for the
worse in China-Taiwan relations undermined investor sentiment and drove foreign
funds and domestic institutions away from the market. What's more, a credit
union collapsed on the back of fraud, which also caused investors to turn to
cash and away from equities.
WHERE WAS THERE STRONG PERFORMANCE?
On the brighter side, stocks in Hong Kong performed well, buoyed by the cut
in U.S. interest rates earlier in the year, and by the results of property
companies. Interest rate sensitive bank stocks also did well there. In Korea,
electronics shares and construction shares did well as did the barometers of
stock market performance, bank shares.
- ---------------
* Trust A Shares total return.
PERFORMANCE QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE
RESULTS. INVESTMENT RETURNS AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT AN
INVESTOR'S SHARES MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST UPON
REDEMPTION.
5
<PAGE> 8
WHAT SECTORS/STOCKS HELPED FUND PERFORMANCE, ESPECIALLY GIVEN THESE DIFFICULT
MARKET CONDITIONS?**
The Fund performed reasonably well against these difficult market
conditions, as it was appropriately positioned in Korea and Hong Kong, while
remaining underweight in Malaysia and Thailand. Holdings of conglomerates such
as Hutchison Whampoa and smaller banks such as Wing Hang Bank and Dao Heng Bank
Group in Hong Kong did well, outperforming the local index, the Hang Seng. The
Fund also benefited from an overweight position in electronics and
export-related stocks in Korea. Samsung Electronics, the world's largest
producer of memory chips, performed particularly well. The relative strength of
the Fund's technology-related stock holdings in Taiwan partially offset the
negative impact of the Taiwanese market's overall poor performance.
AND THE BAD PERFORMERS?
Blue-chip telecom holdings in Thailand negatively impacted the Fund's
performance, as there was heavy selling in these shares where the Fund was
invested.
WHEN DO YOU THINK THE PACIFIC BASIN WILL TURN AROUND?
Looking ahead, we believe the Pacific Basin markets will rebound over the
next few months after the end of the corporate reporting season. And, over the
longer term, valuation of the markets looks very attractive. The Pacific Basin
should also be a beneficiary of any further yen weakness, stimulating portfolio
investment by Japanese institutions in the region. In addition, the region
should benefit from stable U.S. interest rates. The ongoing rush to build
infrastructure, the high savings and investment rates and continued strong
foreign capital investment in the region are expected to keep the growth
momentum going.
WHERE WILL YOU POSITION THE FUND GOING FORWARD?
While interest rates have been high in Korea and Taiwan, we believe they
are likely to decline given the stage of the economic cycle and long-term
financial deregulation. Therefore, we expect the Fund to be overweight versus
the index in these countries, particularly in domestic-related and
export-related stocks. We also expect to add to the Fund's positions in Hong
Kong, particularly property developers, which are showing signs of a recovery in
earnings that we expect will continue over the next 12 months. We are cautious
about markets in Thailand, the Philippines and Malaysia, where the Fund will
continue to be underweight; the trend in these countries is for higher consumer
prices and poor liquidity conditions over the next one to two quarters.
- ---------------
** Portfolio holdings are subject to change and may not be representative of
the Fund's current holdings.
6
<PAGE> 9
NATIONS GLOBAL GOVERNMENT INCOME FUND
PERFORMANCE AND COMMENTARY
- --------------------------------------------------------------------------------
PORTFOLIO MANAGER
Mark Rimmer is the international fixed income manager for Nations Gartmore
Investment Management. Previously, Mark managed multi-currency funds for
institutional clients at Gulf International Bank in Bahrain, and prior to that
he was a senior trader for Sumitomo Finance International, London. He graduated
from Cambridge University.
INVESTMENT OBJECTIVE
Nations Global Government Income Fund's investment objective is to seek current
income. Although the Fund emphasizes income when selecting investments, the
potential for growth of capital also is considered. It seeks to achieve this
objective by investing primarily in debt securities issued by governments, banks
and supranational entities located throughout the world.
- --------------------------------------------------------------------------------
PERFORMANCE REVIEW
Nations Global Government Income Fund commenced operations on June 30,
1995, and therefore, reports only for the three-month period ended September 30,
1995. Since the Fund's inception, activity has concentrated on establishing
positions. During the period under review, global bond markets provided a
disappointing overall return, which reflected upon the Fund's performance. For
the three-month period ended September 30, the Fund provided an aggregate total
return of 1.69%.* However, this return substantially outperformed the (0.12)%
return provided by the Fund's benchmark, the J.P. Morgan Global Government Bond
Index, which tracks government bonds issued in 12 countries in the U.S., Europe
and the Far East.
MANAGER COMMENTARY
WHAT HAPPENED IN THE GLOBAL BOND MARKETS OVER THE PAST THREE MONTHS?
The most notable feature over the past three months was the recovery in the
U.S. dollar, which rose sharply against the deutschemark, and even more sharply
against the yen.
The U.S. bond market had a volatile quarter, ending slightly ahead from
levels at the quarter's start. After a lull in economic activity, which prompted
a 25-basis-point (0.25%) cut in the Fed funds rate in July, evidence emerged
that the economy was growing too quickly. As the summer progressed, it became
clear that the economy was growing at a steady, non-inflationary pace, a climate
still favorable for bond investment. The heavy buying of the dollar in August,
as well as expectations that the Japanese would step up their investment
overseas, were additional factors behind the U.S. bond market rally. Toward the
end of September, the bond market gave back some ground though, due to
profit-taking and a modest setback in the dollar.
WHAT ABOUT OVERSEAS MARKETS?
The U.K. bond market performed well; long-maturity bonds hovered around 8%.
The rally in the U.S. dollar prompted a continuation of the rally in the
high-yielding bond markets of Continental Europe, particularly Denmark, Sweden,
Italy and Spain. However, at the end of the reporting period, this trend was
upset by a setback in the dollar and controversy over the European Monetary
Union.
- ---------------
* Trust A Shares total return.
PERFORMANCE QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE
RESULTS. INVESTMENT RETURNS AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT AN
INVESTOR'S SHARES MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST UPON
REDEMPTION.
7
<PAGE> 10
WHAT'S THE DIFFERENCE BETWEEN THE EUROPEAN UNION AND EUROPEAN MONETARY UNION,
AND CAN YOU EXPAND ON THE RECENT CONTROVERSY?
A European Union (EU) was created to strengthen ties between western,
central and eastern Europe. One goal of the EU is the European Monetary Union
(EMU)--the creation of a single currency and a central bank by January 1, 1999.
So far, 15 countries are members of the EU working toward meeting the strict
criteria set for the EMU.
The EMU controversy was a debate sparked by leaked comments from German
Finance Minister Waigel that he didn't see Italy meeting the EMU criteria by
1999. This was accompanied by doubts about the ability of France and Belgium to
meet the criteria, expressed by a Bundesbank member. These sentiments caused
uncertainty in the bond markets of these countries and susceptibility to
overreaction. The French bond market did suffer in response to these comments
and in the wake of a disappointing budget deficit.
WAS THE FUND INVESTED IN FRANCE?
The Fund had a smaller position than its comparable index, with a 7%
allocation in France at the end of the reporting period--part of which was
hedged back into U.S. dollars to protect investors against the weakening franc.
GETTING BACK TO MARKET BEHAVIOR, HOW DID EVENTS IMPACT THE FUND'S PERFORMANCE?
In terms of the markets, in keeping with our conviction that the dollar was
undervalued and would strengthen, the Fund took a large position in dollar
assets, investing directly in dollar-bloc countries (U.S., Canada and Australia)
and engaging in some defensive hedging activity. These moves had a favorable
effect on the Fund's performance. At the end of August, we lengthened the
duration of the Fund's U.S. bond position toward neutral from a previously
underweight position, taking advantage of a pullback in U.S. bond prices. The
high-yielding bond markets of Italy, Spain and Sweden, which rallied as the
dollar strengthened, helped the Fund's performance, as did a large position in
Danish bonds, which outperformed most markets over the period.
YOU MENTIONED DEFENSIVE HEDGING ACTIVITY. YOUR CONVICTION ON A STRONGER DOLLAR
MUST HAVE BEEN VERY STRONG.
It was; we rarely hedge, only doing so in an effort to protect potential
investor returns. We hedged most of the Fund's limited yen bond exposure back
into the dollar so the Fund benefited from the rally in the dollar against the
yen. Some of the European exposure was also hedged back into dollars, protecting
the Fund from the impact of the strengthening dollar.
HOW ARE YOU POSITIONING THE FUND GOING FORWARD?
We expect both the U.S. and the core European bond markets to provide the
potential for attractive returns, particularly in the longer maturities.
Overall, duration in the Fund has been increased, to approximately 4.9 years.
Most of the duration was added in the U.S. which, at the start of the reporting
period, was underweight the index.
In terms of hedging, we expect the dollar to show only modest upside
strength against the deutschemark and, therefore, the hedge has been partially
reduced.
WHAT ABOUT JAPAN?
While the Japanese bond market was recently supported by the Bank of Japan,
which bought bonds to add liquidity to the market, we expect bond yields to rise
again in the months ahead. Therefore, the Fund has retained an underweight
position there. The yen hedge remains in place as we believe the yen is still
overvalued versus the dollar.
8
<PAGE> 11
NATIONS FUND PORTFOLIOS, INC.
Nations Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
- -----------------------------------------------------------------------------------------------
COMMON STOCKS -- 81.1%
ARGENTINA -- 4.3%
6,800 Banco de Galicia+............................................... $ 122,400
4,600 Central Costanera, ADR.......................................... 111,550
19,000 Compania Naviera Perez.......................................... 161,500
7,000 Quilmes Industrial SA Ord+...................................... 129,500
7,000 Y.P.F. Sociedad Anonima......................................... 126,000
--------------
650,950
--------------
BRAZIL -- 14.1%
27,000 Aracruz Celubse SA, ADR......................................... 270,000
13,700 Cemig Companhia, ADR+........................................... 301,400
30,000 Cia Acos Especiais Itab, ADR.................................... 455,550
19,300 Electrobras, ADR+............................................... 289,500
10,500 Telebras, ADR................................................... 456,750
8,150 Vale Rio Doce................................................... 341,027
--------------
2,114,227
--------------
COLUMBIA -- 1.5%
4,500 Banco Ganadero, Class C, ADR.................................... 63,000
5,900 Banco Industrial Colombiano, ADR................................ 80,387
4,300 Cementos Diamante SA, GDS+...................................... 79,963
--------------
223,350
--------------
HONG KONG -- 3.1%
254,000 Guangdong Investment Ltd. ...................................... 151,939
48,000 New World Development Company................................... 189,350
436,000 Yizheng Chemical Fibre.......................................... 128,290
--------------
469,579
--------------
INDIA -- 4.6%
6,300 Hindalco, GDR................................................... 214,200
4,900 Ranbaxy Laboratories Ltd., GDS+................................. 138,425
18,200 Reliance Industries Ltd., GDS................................... 329,966
--------------
682,591
--------------
INDONESIA -- 3.4%
27,500 Hanjaya Mandala Sampoerna, Alien Shares......................... 256,124
5,500 PT Indonesian Satellite, ADR.................................... 193,188
20,000 Semen Gresik+................................................... 56,500
--------------
505,812
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
9
<PAGE> 12
NATIONS FUND PORTFOLIOS, INC.
Nations Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
- -----------------------------------------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
MALAYSIA -- 17.4%
190,000 Bandar Raya+.................................................... $ 358,519
117,000 Development & Commercial Bank Holdings Corporation.............. 326,035
68,000 Malayan Banking Berhad.......................................... 549,522
218,000 Renong Berhad................................................... 378,376
190,000 Tan Chong Motor Holdings Berhad+................................ 208,758
51,000 Telekom Malaysia................................................ 383,718
62,000 United Engineers (Malaysia) Berhad.............................. 397,373
--------------
2,602,301
--------------
MEXICO -- 5.8%
48,000 Cemex SA........................................................ 184,702
46,000 Cifra SA de CV, ADR+............................................ 53,820
4,900 Desc de CV, Class C, ADR+....................................... 74,113
12,900 Grupo Carso SA de CV, ADR+...................................... 148,350
52,000 Grupo Modelo SA de CV, Class C.................................. 211,505
6,300 Telefonos de Mexico SA, ADR..................................... 200,025
--------------
872,515
--------------
PERU -- 1.9%
21,000 Banco Wiese, ADR................................................ 141,750
10,000 Cementos Lima, ADR+............................................. 140,000
--------------
281,750
--------------
PHILIPPINES -- 2.5%
200,000 Ayala Corporation, Class B...................................... 195,740
136,000 Petron Corporation.............................................. 63,942
1,780 Philippines Long Distance Telephone, ADR........................ 118,148
--------------
377,830
--------------
PORTUGAL -- 0.6%
6,500 Soares da Costa................................................. 94,913
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE> 13
NATIONS FUND PORTFOLIOS, INC.
Nations Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
- -----------------------------------------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
<C> <S> <C>
RUSSIA -- 0.4%
10,000 Petersburg Long Distance, ADR+.................................. $ 63,750
--------------
SOUTH AFRICA -- 9.9%
8,000 Angelo-American Industrial Corporation SA....................... 385,569
13,000 Barlow Ltd...................................................... 146,847
50,000 Gencor Ltd...................................................... 186,212
20,000 Malbak Ltd. NPV................................................. 135,551
1,500 Polifin Ltd.+................................................... 3,122
20,000 Remrandt Group.................................................. 167,043
10,000 Sasol NPV....................................................... 82,152
150,000 South Africa Iron & Steel Industrial Corporation................ 162,251
7,000 South African Breweries......................................... 220,442
--------------
1,489,189
--------------
SOUTH KOREA -- 4.1%
9,500 Dong Ah Construction, EDR+...................................... 242,250
7,500 Korea Electric Power Corporation, ADR........................... 190,312
2,550 Samsung Electronics, GDS++...................................... 178,500
--------------
611,062
--------------
THAILAND -- 4.0%
3,400 Siam Cement Public Company Ltd., Alien Shares................... 200,518
26,000 Thai Farmers Bank Public Company Ltd., Alien Shares............. 225,862
13,000 United Communications Industry.................................. 168,878
--------------
595,258
--------------
TURKEY -- 3.5%
63,000 Alarko Saway.................................................... 67,721
130,000 Cimentas........................................................ 77,781
483,000 Ege Biracilik Vem............................................... 178,780
510,000 Netas Ord....................................................... 196,532
--------------
520,814
--------------
TOTAL COMMON STOCKS
(Cost $12,417,663)........................................... 12,155,891
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
11
<PAGE> 14
NATIONS FUND PORTFOLIOS, INC.
Nations Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
- -----------------------------------------------------------------------------------------------
MUTUAL FUNDS -- 4.3%
<C> <S> <C>
CHILE -- 1.7%
6,000 Chile Fund Inc.................................................. $ 135,750
43,300 Five Arrows Chile Investment Trust Ltd.......................... 124,271
--------------
260,021
--------------
SOUTH KOREA -- 1.5%
50 Korea Europe Fund............................................... 218,750
--------------
TAIWAN -- 1.1%
15,000 Taiwan Index Fund............................................... 157,500
--------------
TOTAL MUTUAL FUNDS
(Cost $643,657).............................................. 636,271
==============
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
- ----------
CONVERTIBLE BOND -- 0.9% (Cost $137,945)
<C> <S> <C>
SOUTH KOREA
CHF150,000 Yukong Convertible,
1.000% due 12/31/98............................................... 142,085
===========
TOTAL INVESTMENTS (Cost $13,199,265*).................................. 86.3% 12,934,247
OTHER ASSETS AND LIABILITIES (NET)..................................... 13.7 2,048,022
----- -----------
NET ASSETS............................................................. 100.0% $14,982,269
===== ===========
<FN>
- ---------------
* Aggregate cost for Federal tax purposes.
+ Non-income producing security.
++ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from registration
to qualified institutional buyers.
</TABLE>
ABBREVIATIONS:
<TABLE>
<S> <C>
ADR American Depositary Receipt
CHF Swiss Franc
EDR European Depositary Receipt
GDR Global Depositary Receipt
GDS Global Depositary Share
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
12
<PAGE> 15
NATIONS FUND PORTFOLIOS, INC.
Nations Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995 (UNAUDITED)
AT SEPTEMBER 30, 1995 SECTOR DIVERSIFICATION WAS AS FOLLOWS:
<TABLE>
<CAPTION>
% OF
NET VALUE
SECTOR DIVERSIFICATION ASSETS (NOTE 1)
- ----------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS:
Banking.............................................................. 10.6% $ 1,578,711
Construction/Engineering............................................. 9.5 1,420,329
Utility.............................................................. 9.0 1,349,512
Telecommunications................................................... 8.8 1,324,238
Metal and Mining..................................................... 8.0 1,196,989
Industrial........................................................... 5.7 851,086
Diversified.......................................................... 4.8 722,466
Food and Beverage.................................................... 3.5 528,722
Tobacco.............................................................. 2.8 423,168
Basic Industry....................................................... 2.4 362,769
Real Estate.......................................................... 2.4 358,519
Oil and Gas.......................................................... 2.3 351,442
Financial Services................................................... 2.3 341,290
Paper and Forest Products............................................ 1.8 270,000
Retail............................................................... 1.8 262,578
Chemicals............................................................ 1.4 213,564
Electronic........................................................... 1.2 178,500
Consumer Services.................................................... 0.9 141,750
Pharmaceuticals and Healthcare....................................... 0.9 138,425
Manufacturing........................................................ 0.5 67,721
Miscellaneous........................................................ 0.5 74,112
----- -----------
TOTAL COMMON STOCKS.................................................. 81.1 12,155,891
MUTUAL FUNDS......................................................... 4.3 636,271
CONVERTIBLE BOND..................................................... 0.9 142,085
----- -----------
TOTAL INVESTMENTS.................................................... 86.3 12,934,247
OTHER ASSETS AND LIABILITIES (NET)................................... 13.7 2,048,022
----- -----------
NET ASSETS........................................................... 100.0% $14,982,269
===== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
13
<PAGE> 16
NATIONS FUND PORTFOLIOS, INC.
Nations Pacific Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
- -----------------------------------------------------------------------------------------------
COMMON STOCKS -- 82.0%
<C> <S> <C>
AUSTRALIA -- 3.8%
87,000 Australia & New Zealand Bank Group................................. $ 372,804
18,000 Broken Hill Property............................................... 247,856
125,000 Skilled Engineering Ltd............................................ 240,895
38,000 Western Mining Corporation Holdings................................ 248,702
-----------
1,110,257
-----------
HONG KONG -- 27.7%
134,000 China Light & Power................................................ 693,250
246,000 Dao Heng Bank Group................................................ 816,108
66,000 Hang Seng Bank Ltd................................................. 544,188
180,000 Hong Kong & China Gas.............................................. 289,846
270,000 Hong Kong Telecommunications....................................... 490,642
64,800 HSBC Holdings...................................................... 900,966
199,000 Hutchison Whampoa.................................................. 1,078,430
50,400 Jardine Matheson Holdings.......................................... 340,200
168,000 New World Development Company...................................... 662,726
149,000 Sun Hung Kai Properties............................................ 1,209,275
98,000 Swire Pacific...................................................... 776,349
95,000 Wing Hang Bank..................................................... 321,307
-----------
8,123,287
-----------
INDONESIA -- 4.9%
52,500 Bank Dagang Nasional Indonesia..................................... 48,085
153,000 Bank Dagang Nasional Indonesia, Alien Shares....................... 140,135
11,000 Hanjaya Mandala Sampoerna.......................................... 102,450
35,000 Hanjaya Mandala Sampoerna, Alien Shares............................ 325,977
11,000 PT Indonesian Satellite, ADR....................................... 386,375
80,000 Semen Cibinong, Alien Shares....................................... 217,171
80,000 Semen Gresik, Alien Shares......................................... 225,999
-----------
1,446,192
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
14
<PAGE> 17
NATIONS FUND PORTFOLIOS, INC.
Nations Pacific Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
- -----------------------------------------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
<C> <S> <C>
MALAYSIA -- 14.9%
230,000 Bandar Raya+....................................................... $ 433,997
110,000 Cement Industries of Malaysia+..................................... 352,508
120,000 Development & Commercial Bank Holdings Corporation................. 334,395
38,000 Genting Berhad..................................................... 328,264
208,000 Highlands & Lowlands............................................... 354,395
100,000 Hong Leong Bank Berhad............................................. 270,701
67,000 Malayan Banking Berhad............................................. 541,441
285,000 Renong Berhad...................................................... 494,666
100,000 RJ Reynolds Berhad................................................. 210,987
75,000 Telekom Malaysia................................................... 564,291
73,000 United Engineers (Malaysia) Berhad................................. 467,874
-----------
4,353,519
-----------
PHILIPPINES -- 2.7%
84,400 Ayala Corporation, Class B......................................... 82,602
80,000 Ayala Land Inc., Class B........................................... 89,042
900,000 Belle Corporation.................................................. 153,713
48,000 First Philippines Holdings, Class B+............................... 116,062
100,000 Philipino Telephone Corporation+................................... 94,991
3,900 Philippines Long Distance Telephone, ADR........................... 258,863
-----------
795,273
-----------
SINGAPORE -- 11.2%
35,000 Cycle & Carriage................................................... 312,324
63,000 Development Bank of Singapore, Alien Shares........................ 717,116
23,000 Fraser & Neave..................................................... 266,653
265,000 Liang Court Holdings+.............................................. 256,956
145,000 Parkway Holdings+.................................................. 362,704
44,000 Singapore International Airlines, Alien Shares..................... 408,094
110,000 Straits Steamship Land Ltd......................................... 301,433
395,000 Sunright Ltd.+..................................................... 265,054
45,000 United Overseas Bank, Alien Shares................................. 388,912
-----------
3,279,246
-----------
SOUTH KOREA -- 6.0%
19,500 Dong Ah Construction, EDR.......................................... 497,250
22,450 Korea Electric Power Corporation, ADR.............................. 569,669
13,500 LG Electronics Inc., GDS+.......................................... 167,130
22 Samsung Electronics, GDR+.......................................... 1,288
5,300 Samsung Electronics, GDS++......................................... 371,000
14,000 Yukong Ltd., GDS+.................................................. 147,000
-----------
1,753,337
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
15
<PAGE> 18
NATIONS FUND PORTFOLIOS, INC.
Nations Pacific Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
- -----------------------------------------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
<C> <S> <C>
THAILAND -- 10.8%
28,000 Advanced Information Services...................................... $ 441,841
132,000 Krung Thai Bank Public Company Ltd................................. 526,001
104,000 National Petrochemical Company+.................................... 217,573
32,000 Phatra Thanakit Finance & Securities, Alien Shares................. 232,078
20,000 Quality Houses+.................................................... 93,246
26,000 Quality Houses, Alien Shares+...................................... 124,328
10,000 Siam Cement Public Company Ltd..................................... 589,759
76,200 Thai Farmers Bank Public Company Ltd., Alien Shares................ 661,949
40,000 Thai Telephone & Telecom+.......................................... 278,940
-----------
3,165,715
-----------
TOTAL COMMON STOCKS
(Cost $24,437,624).............................................. 24,026,826
===========
MUTUAL FUNDS -- 3.5%
HONG KONG -- 1.6%
40,000 New Taipai Fund Ltd................................................ 480,000
-----------
SOUTH KOREA -- 1.9%
126 Korea Europe Fund.................................................. 551,250
-----------
TOTAL MUTUAL FUNDS
(Cost $1,025,750)............................................... 1,031,250
===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
16
<PAGE> 19
NATIONS FUND PORTFOLIOS, INC.
Nations Pacific Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ---------------------------------------------------------------------------------------------
CONVERTIBLE BONDS -- 2.2%
<C> <S> <C>
SOUTH KOREA -- 0.5%
CHF150,000 Yukong Convertible,
1.000% due 12/31/98............................................... $ 142,085
-----------
TAIWAN -- 1.7%
USD 30,000 Acer Inc.,
4.000% due 06/10/01............................................... 96,450
USD255,000 United Microelectronics,
1.250% due 06/08/04............................................... 412,463
-----------
508,913
-----------
TOTAL CONVERTIBLE BONDS
(Cost $680,175)................................................... 650,998
===========
</TABLE>
<TABLE>
<CAPTION>
SHARES
-----
RIGHTS -- 0.0%# (Cost $12,693)
<C> <S> <C>
58,750 Liang Court Holdings, Expire 10/6/95.............................. 11,765
===========
TOTAL INVESTMENTS (Cost $26,156,242*)................................... 87.7% 25,720,839
OTHER ASSETS AND LIABILITIES (NET)...................................... 12.3 3,597,164
----- -----------
NET ASSETS.............................................................. 100.0% $29,318,003
===== ===========
<FN>
- ---------------
* Aggregate cost for Federal tax purposes.
+ Non-income producing security.
++ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration to qualified institutional buyers.
# Amount represents less than 0.1%.
</TABLE>
ABBREVIATIONS:
<TABLE>
<S> <C>
ADR American Depositary Receipt
CHF Swiss Franc
EDR European Depositary Receipt
GDR Global Depositary Receipt
GDS Global Depositary Share
USD United States Dollar
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
17
<PAGE> 20
NATIONS FUND PORTFOLIOS, INC.
Nations Pacific Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995 (UNAUDITED)
AT SEPTEMBER 30, 1995 SECTOR DIVERSIFICATION WAS AS FOLLOWS:
<TABLE>
<CAPTION>
% OF
NET VALUE
SECTOR DIVERSIFICATION ASSETS (NOTE 1)
- ----------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS:
Banking.............................................................. 19.4% $ 5,683,142
Real Estate.......................................................... 9.1 2,661,990
Telecommunications................................................... 8.6 2,515,944
Diversified.......................................................... 7.3 2,134,464
Construction/Engineering............................................. 6.8 2,001,697
Financial Services................................................... 6.1 1,795,770
Utility.............................................................. 5.3 1,552,764
Transportation....................................................... 4.0 1,184,444
Basic Industry....................................................... 2.9 837,615
Electronics.......................................................... 2.7 804,472
Tobacco.............................................................. 2.2 639,413
Agriculture/Farming.................................................. 1.2 354,395
Wholesaler........................................................... 1.2 340,200
Leisure.............................................................. 1.1 328,264
Automobiles.......................................................... 1.1 312,324
Nondurable Goods..................................................... 0.9 266,653
Metal and Mining..................................................... 0.9 248,702
Chemicals............................................................ 0.7 217,573
Oil and Gas.......................................................... 0.5 147,000
----- -----------
TOTAL COMMON STOCKS.................................................. 82.0 24,026,826
MUTUAL FUNDS......................................................... 3.5 1,031,250
CONVERTIBLE BONDS.................................................... 2.2 650,998
RIGHTS............................................................... 0.0# 11,765
----- -----------
TOTAL INVESTMENTS.................................................... 87.7 25,720,839
OTHER ASSETS AND LIABILITIES (NET)................................... 12.3 3,597,164
----- -----------
NET ASSETS........................................................... 100.0% $29,318,003
===== ===========
</TABLE>
- ---------------
# Amount represents less than 0.1%.
SEE NOTES TO FINANCIAL STATEMENTS.
18
<PAGE> 21
NATIONS FUND PORTFOLIOS, INC.
Nations Pacific Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF FORWARD FOREIGN EXCHANGE CONTRACTS SEPTEMBER 30, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
CONTRACT TO BUY NET UNREALIZED
-------------------------------------------------- APPRECIATION/
LOCAL VALUE IN IN EXCHANGE (DEPRECIATION) OF
MATURITY DATE CURRENCY U.S. $ FOR U.S. $ CONTRACT
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
10/02/95 92,001 SGD..................... 64,646 63,845 $ 801
10/02/95 398,229 THB..................... 15,749 15,752 (3)
10/03/95 798,043 THB..................... 31,799 31,807 (8)
10/04/95 128,681,324 IDR..................... 56,777 56,813 (36)
10/04/95 689,940 MYR..................... 274,660 273,509 1,151
10/04/95 131,992 SGD..................... 92,754 92,399 355
10/05/95 191,798 MYR..................... 76,354 75,930 424
10/06/95 96,223 MYR..................... 38,306 38,218 88
-------- ------- -------
651,045 648,273 $ 2,772
======== ======= =======
</TABLE>
<TABLE>
<CAPTION>
CONTRACT TO SELL NET UNREALIZED
-------------------------------------------------- APPRECIATION/
LOCAL VALUE IN IN EXCHANGE (DEPRECIATION) OF
MATURITY DATE CURRENCY U.S. $ FOR U.S. $ CONTRACT
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
10/03/95 1,340,418 PHP....................... 51,444 51,495 $ 51
10/04/95 1,217,260 PHP....................... 46,716 46,692 (24)
10/05/95 462,584 PHP....................... 17,752 17,683 (69)
------- ------- -------
115,912 115,870 $ (42)
======= ======= =======
Net Unrealized Appreciation of Forward Foreign
Exchange Contracts.............................................. $ 2,730
=======
-------------------------------------------
ABBREVIATIONS OF CURRENCY
THAT ISSUE IS HELD IN:
IDR Indonesian Rupee
MYR Malaysian Ringgit
PHP Philippine Peso
SGD Singapore Dollar
THB Thai Baht
-------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
19
<PAGE> 22
NATIONS FUND PORTFOLIOS, INC.
Nations Global Government Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ----------------------------------------------------------------------------------------------
FOREIGN GOVERNMENT BONDS AND NOTES -- 80.3%
<S> <C> <C> <C>
AUSTRALIA -- 5.0%
AUD 1,340,000 Government of Australia,
8.750% due 01/15/01................................. $ 1,037,769
------------
AUSTRIA -- 3.7%
DM 1,000,000 Government of Austria,
8.000% due 06/17/02................................. 752,274
------------
BELGIUM -- 4.7%
USD 950,000 Kingdom of Belgium,
7.000% due 07/07/99................................. 973,750
------------
CANADA -- 4.8%
CAD 1,280,000 Government of Canada,
8.500% due 03/01/00................................. 992,418
------------
DENMARK -- 7.4%
DKK 7,800,000 Kingdom of Denmark,
9.000% due 11/15/00................................. 1,510,190
------------
FRANCE -- 6.7%
FRF 6,500,000 Government of France,
8.125% due 05/25/99................................. 1,381,704
------------
GERMANY -- 12.2%
DM 725,000 Bundes Obligation,
6.125% due 05/20/99................................. 521,655
DM 580,000 Federal Republic of Germany,
7.250% due 10/21/02................................. 425,644
DM 1,000,000 Federal Republic of Germany,
6.250% due 01/04/24................................. 602,519
USD 900,000 LKB, (Baden Wurltemb),
8.125% due 01/27/00................................. 954,045
------------
2,503,863
------------
ITALY -- 3.7%
ITL 1,300,000,000 Republic of Italy,
9.500% due 12/01/99................................. 758,636
------------
JAPAN -- 6.4%
JPY 115,000,000 Japan Development Bank,
5.000% due 10/01/99................................. 1,313,349
------------
NETHERLANDS -- 4.7%
NLG 1,400,000 Government of Netherlands,
8.250% due 06/15/02................................. 970,436
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
20
<PAGE> 23
NATIONS FUND PORTFOLIOS, INC.
Nations Global Government Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ----------------------------------------------------------------------------------------------
FOREIGN GOVERNMENT BONDS AND NOTES -- (CONTINUED)
<S> <C> <C> <C>
PORTUGAL -- 4.6%
ECU 830,000 Government of Portugal,
6.000% due 02/16/04................................. $ 943,618
-----------
SPAIN -- 2.5%
ESP 60,000,000 Government of Spain,
12.250% due 03/25/00................................ 511,852
-----------
SUPRANATIONAL -- 6.5%
GBP 380,000 European Investment Bank,
8.000% due 06/10/03................................. 587,679
DM 1,000,000 International Bank for Reconstruction & Development,
7.250% due 10/13/99................................. 740,868
-----------
1,328,547
-----------
SWEDEN -- 2.5%
SEK 4,500,000 Government of Sweden,
6.000% due 02/09/05................................. 514,901
-----------
UNITED KINGDOM -- 4.9%
GBP 300,000 United Kingdom Treasury,
8.000% due 12/07/00................................. 481,733
GBP 340,000 United Kingdom Treasury,
8.000% due 09/27/13................................. 523,468
-----------
1,005,201
-----------
TOTAL FOREIGN GOVERNMENT BONDS AND NOTES
(Cost $16,539,863)................................. 16,498,508
===========
U.S. TREASURY OBLIGATIONS -- 14.8%
USD 1,400,000 U.S. Treasury Note,
7.500% due 05/15/02................................. 1,508,992
USD 1,500,000 U.S. Treasury Note,
6.500% due 08/15/05................................. 1,536,388
-----------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $3,016,716).................................. 3,045,380
===========
TOTAL INVESTMENTS (Cost $19,556,579*)................................ 95.1% 19,543,888
OTHER ASSETS AND LIABILITIES (NET)................................... 4.9 1,000,259
----- -----------
NET ASSETS........................................................... 100.0% $20,544,147
===== ===========
<FN>
- ---------------
* Aggregate cost for Federal tax purposes.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
21
<PAGE> 24
NATIONS FUND PORTFOLIOS, INC.
Nations Global Government Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF FORWARD FOREIGN EXCHANGE CONTRACTS SEPTEMBER 30, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
CONTRACT TO BUY NET UNREALIZED
-------------------------------------------------- APPRECIATION/
EXPIRATION LOCAL VALUE IN IN EXCHANGE (DEPRECIATION) OF
DATE CURRENCY U.S. $ FOR U.S. $ CONTRACT
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
10/06/95 550,000 DM ..................... 384,942 373,972 $10,970
======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
CONTRACT TO SELL NET UNREALIZED
-------------------------------------------------- APPRECIATION/
EXPIRATION LOCAL VALUE IN IN EXCHANGE (DEPRECIATION) OF
DATE CURRENCY U.S. $ FOR U.S. $ CONTRACT
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
10/06/95 1,650,000 DM ..................... 1,154,827 1,198,867 $ 44,040
10/06/95 3,870,000 FRF..................... 785,853 798,152 12,299
10/06/95 85,000,000 JPY .................... 858,548 1,016,017 157,469
--------- --------- --------
2,799,228 3,013,036 $213,808
========= ========= ========
Net Unrealized Appreciation of Forward Foreign
Exchange Contracts........................................ $224,778
========
-----------------------------------------------------------------
ABBREVIATIONS OF CURRENCY
THAT ISSUE IS HELD IN:
AUD Australian Dollar
CAD Canadian Dollar
DM German Deutschemark
DKK Danish Kroner
ECU European Currency Units
ESP Spanish Peseta
FRF French Franc
GBP Great Britain Pound
ITL Italian Lira
JPY Japanese Yen
NLG Netherlands Guilder
SEK Swedish Krona
USD United States Dollar
-----------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
22
<PAGE> 25
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES SEPTEMBER 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
NATIONS
NATIONS NATIONS GLOBAL
EMERGING PACIFIC GOVERNMENT
MARKETS GROWTH INCOME
FUND FUND FUND
--------------------------------------
<S> <C> <C> <C>
ASSETS:
Investments, at value. See accompanying schedule...... $12,934,247 $25,720,839 $19,543,888
Cash.................................................. 2,319,261 3,871,496 143,901
Foreign currency, at value (Cost $14,556)............. 14,449 -- --
Net unrealized appreciation of forward foreign
exchange contracts. See accompanying schedule....... -- 2,730 224,778
Dividends receivable.................................. 11,028 32,058 --
Interest receivable................................... 928 11,443 656,231
Receivable for investment securities sold............. -- 115,919 --
Receivable for Fund shares sold....................... 47,961 250,589 1,036
Unamortized organization costs (Note 6)............... 118,953 122,462 119,238
Prepaid expenses and other assets..................... 14,310 18,642 2,867
----------- ----------- -----------
Total Assets..................................... 15,461,137 30,146,178 20,691,939
=========== =========== ===========
LIABILITIES:
Payable for Fund shares redeemed...................... 7,926 14,939 7,926
Payable for investment securities purchased........... 387,888 722,131 --
Investment advisory fee payable (Note 2).............. 12,779 20,337 11,686
Administration fee payable (Note 2)................... 1,162 2,260 1,670
Shareholder servicing and distribution fees payable
(Note 3)............................................ 299 67 62
Transfer agent fees payable (Note 2).................. 101 157 314
Custodian fees payable (Note 2)....................... 5,490 9,328 1,089
Dividends payable..................................... -- -- 87,540
Organization cost payable............................. 53,386 47,134 25,355
Accrued Directors' fees and expenses (Note 2)......... 1,762 2,497 3,134
Accrued expenses and other payables................... 8,075 9,325 9,016
----------- ----------- -----------
Total Liabilities................................ 478,868 828,175 147,792
----------- ----------- -----------
NET ASSETS............................................ $14,982,269 $29,318,003 $20,544,147
=========== =========== ===========
Investments, at cost (Note 1)......................... $13,199,265 $26,156,242 $19,556,579
=========== =========== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
23
<PAGE> 26
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED) SEPTEMBER 30, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
NATIONS
NATIONS NATIONS GLOBAL
EMERGING PACIFIC GOVERNMENT
MARKETS GROWTH INCOME
FUND FUND FUND
--------------------------------------
<S> <C> <C> <C>
NET ASSETS CONSIST OF:
Undistributed net investment income/(accumulated net
investment loss).................................... $ (1,174) $ 6,956 $ --
Accumulated net realized loss on investments sold,
forward foreign exchange contracts and foreign
currency transactions............................... (43,676) (89,559) (115,135)
Net unrealized appreciation/(depreciation) of
investments, forward foreign exchange contracts,
foreign currencies and net other assets............. (265,068) (435,647) 204,672
Par value............................................. 1,517 3,019 2,045
Paid-in capital in excess of par value................ 15,290,670 29,833,234 20,452,565
----------- ----------- -----------
$14,982,269 $29,318,003 $20,544,147
=========== =========== ===========
NET ASSETS:
Trust A Shares........................................ $14,529,320 $28,726,552 $20,402,340
=========== =========== ===========
Investor A Shares..................................... $ 56,637 $ 161,219 $ 23,140
=========== =========== ===========
Investor C Shares..................................... $ 10,030 $ 45,592 $ 8,637
=========== =========== ===========
Investor N Shares..................................... $ 386,282 $ 384,640 $ 110,030
=========== =========== ===========
SHARES OUTSTANDING:
Trust A Shares........................................ 1,471,177 2,957,866 2,031,348
=========== =========== ===========
Investor A Shares..................................... 5,740 16,612 2,304
=========== =========== ===========
Investor C Shares..................................... 1,018 4,708 860
=========== =========== ===========
Investor N Shares..................................... 39,208 39,706 10,955
=========== =========== ===========
TRUST A SHARES:
Net asset value, offering price and redemption price
per share........................................... $9.88 $9.71 $10.04
=========== =========== ===========
INVESTOR A SHARES:
Net asset value and redemption price per share........ $9.87 $9.70 $10.04
=========== =========== ===========
Maximum sales charge.................................. 5.75% 5.75% 4.75%
Maximum offering price per share...................... $10.47 $10.29 $10.54
=========== =========== ===========
INVESTOR C SHARES:
Net asset value and offering price per share*......... $9.85 $9.68 $10.04
=========== =========== ===========
INVESTOR N SHARES:
Net asset value and offering price per share*......... $9.85 $9.69 $10.04
=========== =========== ===========
<FN>
- ---------------
* Redemption price per share is equal to Net Asset Value less any applicable
contingent deferred sales charge.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
24
<PAGE> 27
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE PERIOD ENDED SEPTEMBER 30, 1995 (UNAUDITED)*
<TABLE>
<CAPTION>
NATIONS
NATIONS NATIONS GLOBAL
EMERGING PACIFIC GOVERNMENT
MARKETS GROWTH INCOME
FUND FUND FUND
-----------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest (net of foreign withholding taxes of $47, $48 and
$654, respectively)...................................... $ 30,219 $ 18,167 $ 319,156
Dividends (net of foreign withholding taxes of $1,853 and
$9,367 respectively)..................................... 19,419 68,657 --
--------- --------- ---------
Total investment income............................... 49,638 86,824 319,156
--------- --------- ---------
EXPENSES:
Investment advisory fee (Note 2)........................... 29,735 42,625 34,963
Administration fee (Note 2)................................ 2,703 4,736 4,995
Transfer agent fees (Note 2)............................... 152 236 471
Custodian fees (Note 2).................................... 726 10,868 2,479
Legal and audit fees....................................... 5,210 5,292 5,292
Directors' fees and expenses (Note 2)...................... 2,859 5,894 4,833
Amortization of organization costs (Note 6)................ 5,979 5,979 5,774
Other...................................................... 3,040 3,886 1,117
--------- --------- ---------
Subtotal.............................................. 50,404 79,516 59,924
Shareholder servicing and distribution fees (Note 3):
Investor A Shares........................................ 24 36 7
Investor C Shares........................................ 22 61 20
Investor N Shares........................................ 362 255 66
--------- --------- ---------
Total expenses........................................ 50,812 79,868 60,017
--------- --------- ---------
NET INVESTMENT INCOME/(LOSS)............................... (1,174) 6,956 259,139
--------- --------- ---------
NET REALIZED AND UNREALIZED GAIN/
(LOSS) ON INVESTMENTS (NOTES 1 AND 4):
Realized gain/(loss) from:
Security transactions.................................... (32,609) (80,672) (94,464)
Forward foreign exchange contracts....................... (19,654) (36,624) (108,993)
Foreign currency transactions............................ 8,587 27,737 88,322
--------- --------- ---------
Net realized loss on investments during the period......... (43,676) (89,559) (115,135)
--------- --------- ---------
Change in unrealized appreciation/(depreciation) of:
Securities............................................... (265,018) (435,403) (12,691)
Forward foreign exchange contracts....................... -- 2,730 224,778
Foreign currencies and net other assets.................. (50) (2,974) (7,415)
--------- --------- ---------
Net unrealized appreciation/(depreciation) of investments
during the period........................................ (265,068) (435,647) 204,672
--------- --------- ---------
Net realized and unrealized gain/(loss) on investments..... (308,744) (525,206) 89,537
--------- --------- ---------
NET INCREASE/(DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS................................. $(309,918) $(518,250) $ 348,676
========= ========= =========
<FN>
- ---------------
* The Nations Emerging Markets Fund, Nations Pacific Growth Fund and Nations
Global Government Income Fund commenced operations on June 30, 1995.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
25
<PAGE> 28
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
PERIOD ENDED SEPTEMBER 30, 1995 (UNAUDITED)*
<TABLE>
<CAPTION>
NATIONS
NATIONS NATIONS GLOBAL
EMERGING PACIFIC GOVERNMENT
MARKETS GROWTH INCOME
FUND FUND FUND
----------------------------------------
<S> <C> <C> <C>
Net investment income/(loss)....................... $ (1,174) $ 6,956 $ 259,139
Net realized loss on investments sold, forward
foreign exchange contracts and foreign currency
transactions during the period................... (43,676) (89,559) (115,135)
Change in unrealized appreciation/(depreciation) of
investments, forward foreign exchange contracts,
foreign currencies and net other assets during
the period....................................... (265,068) (435,647) 204,672
----------- ----------- -----------
Net increase/(decrease) in net assets resulting
from operations.................................. (309,918) (518,250) 348,676
Distributions to shareholders from net investment
income:
Trust A Shares................................ -- -- (258,664)
Investor A Shares............................. -- -- (154)
Investor C Shares............................. -- -- (90)
Investor N Shares............................. -- -- (231)
Net increase in net assets from Fund share
transactions (Note 5):
Trust A....................................... 14,819,814 29,233,410 20,305,801
Investor A.................................... 49,343 153,819 14,465
Investor C.................................... 1,703 38,027 99
Investor N.................................... 387,327 376,997 100,245
----------- ----------- -----------
Net increase in net assets......................... 14,948,269 29,284,003 20,510,147
NET ASSETS:
Beginning of period................................ 34,000 34,000 34,000
----------- ----------- -----------
End of period...................................... $14,982,269 $29,318,003 $20,544,147
=========== =========== ===========
Undistributed net investment income/(accumulated
net investment loss)............................. $ (1,174) $ 6,956 $ --
=========== =========== ===========
<FN>
- ---------------
* The Nations Emerging Markets Fund, Nations Pacific Growth Fund and Nations
Global Government Income Fund commenced operations on June 30, 1995.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
26
<PAGE> 29
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (UNAUDITED)
<TABLE>
<CAPTION>
NATIONS EMERGING NATIONS PACIFIC NATIONS GLOBAL GOVERNMENT
MARKETS FUND GROWTH FUND INCOME FUND
PERIOD ENDED PERIOD ENDED PERIOD ENDED
SEPTEMBER 30, 1995* SEPTEMBER 30, 1995** SEPTEMBER 30, 1995***
------------------------- ------------------------- -------------------------
SHARES DOLLARS SHARES DOLLARS SHARES DOLLARS
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
TRUST A SHARES:
Sold....................... 1,472,351 $14,840,039 2,975,376 $29,412,359 2,031,636 $20,317,161
Issued as reinvestment
of dividends............. -- -- -- -- 11 109
Redeemed................... (2,024) (20,225) (18,360) (178,949) (1,149) (11,469)
---------- ----------- ---------- ----------- ---------- -----------
Net increase............... 1,470,327 $14,819,814 2,957,016 $29,233,410 2,030,498 $20,305,801
========== =========== ========== =========== ========== ===========
INVESTOR A SHARES:
Sold....................... 5,697 $ 57,668 15,772 $ 153,920 1,439 $ 14,311
Issued as reinvestment
of dividends............. -- -- -- -- 15 154
Redeemed................... (807) (8,325) (10) (101) -- --
---------- ----------- ---------- ----------- ---------- -----------
Net increase............... 4,890 $ 49,343 15,762 $ 153,819 1,454 $ 14,465
========== =========== ========== =========== ========== ===========
INVESTOR C SHARES:
Sold....................... 168 $ 1,703 3,858 $ 38,027 1 $ 10
Issued as reinvestment
of dividends............. -- -- -- -- 9 89
---------- ----------- ---------- ----------- ---------- -----------
Net increase............... 168 $ 1,703 3,858 $ 38,027 10 $ 99
========== =========== ========== =========== ========== ===========
INVESTOR N SHARES:
Sold....................... 38,358 $ 387,327 38,856 $ 376,997 10,082 $ 100,014
Issued as reinvestment
of dividends............. -- -- -- -- 23 231
---------- ----------- ---------- ----------- ---------- -----------
Net increase............... 38,358 $ 387,327 38,856 $ 376,997 10,105 $ 100,245
========== =========== ========== =========== ========== ===========
<FN>
- ---------------
* The Nations Emerging Markets Fund's Trust A Shares, Investor A Shares,
Investor C Shares and Investor N Shares commenced operations on June 30,
1995.
** The Nations Pacific Growth Fund's Trust A Shares, Investor A Shares,
Investor C Shares and Investor N Shares commenced operations on June 30,
1995.
*** The Nations Global Government Income Fund's Trust A Shares, Investor A
Shares, Investor C Shares and Investor N Shares commenced operations on June
30, 1995.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
27
<PAGE> 30
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (UNAUDITED)
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD.
<TABLE>
<CAPTION>
TRUST A INVESTOR A INVESTOR C INVESTOR N
SHARES SHARES SHARES SHARES
----------- ------------ ------------ ------------
PERIOD PERIOD PERIOD PERIOD
ENDED ENDED ENDED ENDED
09/30/95*# 09/30/95*# 09/30/95*# 09/30/95*#
--------------------------------------------------------------
<S> <C> <C> <C> <C>
NATIONS EMERGING MARKETS FUND:
Operating performance:
Net asset value, beginning of period..................... $10.00 $10.00 $10.00 $10.00
------ ------ ------ ------
Net investment loss##.................................... (0.00)** (0.01) (0.02) (0.02)
Net realized and unrealized loss on investments.......... (0.12) (0.12) (0.13) (0.13)
------ ------ ------ ------
Net decrease in net assets resulting from investment
operations............................................. (0.12) (0.13) (0.15) (0.15)
------ ------ ------ ------
Net asset value, end of period........................... $9.88 $9.87 $9.85 $9.85
====== ====== ====== ======
Total return++........................................... (1.20)% (1.30)% (1.50)% (1.50)%
====== ====== ====== ======
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)................. $14,529 $ 57 $ 10 $ 386
Ratio of operating expenses to average net assets.... 1.90%+ 2.15%+ 2.90%+ 2.90%+
Ratio of net investment loss to average net assets... (0.03)%+ (0.28)%+ (1.03)%+ (1.03)%+
Portfolio turnover rate.............................. 10% 10% 10% 10%
<FN>
- ---------------
* The Nations Emerging Markets Fund Trust A, Investor A, Investor C and
Investor N Shares commenced operations on June 30, 1995, respectively.
** Amount represents less than $0.01 per share.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and
does not reflect any applicable sales charges.
# Per share numbers have been calculated using the average shares method, which
more appropriately presents the per share data for the period.
## The amount shown at this caption for each share outstanding throughout the
period may not accord with the change in the aggregate gains and losses in
the portfolio securities for the period because of the timing of purchases
and withdrawals of shares in relation to the fluctuating market value of the
portfolio.
</TABLE>
<TABLE>
<CAPTION>
TRUST A INVESTOR A INVESTOR C INVESTOR N
SHARES SHARES SHARES SHARES
----------- ------------ ------------ ------------
PERIOD PERIOD PERIOD PERIOD
ENDED ENDED ENDED ENDED
09/30/95*# 09/30/95*# 09/30/95*# 09/30/95*#
-------------------------------------------------------------
<S> <C> <C> <C> <C>
NATIONS PACIFIC GROWTH FUND:
Operating performance:
Net asset value, beginning of period..................... $10.00 $10.00 $10.00 $10.00
------ ------ ------ ------
Net investment income/(loss)............................. 0.01 (0.00)** (0.02) (0.01)
Net realized and unrealized loss on investments.......... (0.30) (0.30) (0.30) (0.30)
------ ------ ------ ------
Net decrease in net assets resulting from investment
operations............................................. (0.29) (0.30) (0.32) (0.31)
------ ------ ------ ------
Net asset value, end of period........................... $9.71 $9.70 $9.68 $9.69
====== ====== ====== ======
Total return++........................................... (2.90)% (3.00)% (3.20)% (3.10)%
====== ====== ====== ======
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)................. $28,727 $161 $46 $385
Ratio of operating expenses to average net assets.... 1.70%+ 1.95%+ 2.70%+ 2.70%+
Ratio of net investment income/(loss) to average net
assets............................................. 0.15%+ (0.10)%+ (0.85)%+ (0.85)%+
Portfolio turnover rate.............................. 3% 3% 3% 3%
<FN>
- ---------------
* The Nations Pacific Growth Fund Trust A, Investor A, Investor C and Investor
N Shares commenced operations on June 30, 1995, respectively.
** Amount represents less than $0.01 per share.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and
does not reflect any applicable sales charges.
# Per share numbers have been calculated using the average shares method, which
more appropriately presents the per share data for the period.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
28
<PAGE> 31
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (UNAUDITED) (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD.
<TABLE>
<CAPTION>
TRUST A INVESTOR A INVESTOR C INVESTOR N
SHARES SHARES SHARES SHARES
----------- ------------ ------------ ------------
PERIOD PERIOD PERIOD PERIOD
ENDED ENDED ENDED ENDED
09/30/95* 09/30/95* 09/30/95* 09/30/95*
-------------------------------------------------------------
<S> <C> <C> <C> <C>
NATIONS GLOBAL GOVERNMENT INCOME FUND:
Operating performance:
Net asset value, beginning of period..................... $10.00 $10.00 $10.00 $10.00
------ ------ ------ ------
Net investment income.................................... 0.13 0.12 0.10 0.10
Net realized and unrealized gain on investments.......... 0.04 0.04 0.04 0.04
------ ------ ------ ------
Net increase in net assets resulting from investment
operations............................................. 0.17 0.16 0.14 0.14
Distributions:
Dividends from net investment income................... (0.13) (0.12) (0.10) (0.10)
------ ------ ------ ------
Total distributions.................................... (0.13) (0.12) (0.10) (0.10)
------ ------ ------ ------
Net asset value, end of period........................... $10.04 $10.04 $10.04 $10.04
====== ====== ====== ======
Total return++........................................... 1.69% 1.63% 1.46% 1.46%
====== ====== ====== ======
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)................. $20,402 $23 $9 $110
Ratio of operating expenses to average net assets.... 1.30%+ 1.55%+ 2.30%+ 2.30%+
Ratio of net investment income to average net
assets............................................. 5.61%+ 5.36%+ 4.61%+ 4.61%+
Portfolio turnover rate.............................. 104% 104% 104% 104%
<FN>
- ---------------
* The Nations Global Government Income Fund Trust A, Investor A, Investor C
Shares and Investor N Shares commenced operations on June 30, 1995,
respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and
does not reflect any applicable sales charges.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
29
<PAGE> 32
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES.
Nations Fund Portfolios, Inc. ("Nations Portfolios") is a Maryland
corporation registered under the Investment Company Act of 1940, as amended (the
"1940 Act"), as a diversified, open-end management investment company and
consists of three separate portfolios: Nations Emerging Markets Fund ("Emerging
Markets Fund"), Nations Pacific Growth Fund ("Pacific Growth Fund") and Nations
Global Government Income Fund ("Global Government Income Fund") (individually a
"Fund", collectively the "Funds"). Each Fund currently offers four classes of
shares: Trust A Shares, Investor A Shares, Investor C Shares and Investor N
Shares. The Board of Directors has authorized each Fund to issue Trust B Shares.
As of September 30, 1995, no Trust B Shares have been issued. Shareholders of a
Fund have equal voting rights on matters affecting all of a Fund's shareholders
equally. In addition, each class of shares of a Fund has exclusive voting rights
on matters that relate solely to that class, and separate voting rights on
matters in which the interests of one class of shares differ from the interests
of any other class. The following is a summary of the significant accounting
policies followed by the Funds in the preparation of their financial statements.
SECURITIES VALUATION: A security listed or traded on an exchange is valued
at its last sales price on the exchange where the security is principally traded
or, lacking any sales on a particular day, the security is valued at the mean
between the closing bid and asked prices on that day. Each security traded in
the over-the-counter market (but not including securities reported on the NASDAQ
National Market System) is valued at the mean between the last available bid and
asked prices based upon quotes furnished by market makers for such securities.
Each security reported on the NASDAQ National Market System is valued at the
last sales price on the valuation date. Debt obligations that are issued or
guaranteed by the U.S. government, its agencies, authorities and
instrumentalities are valued on the basis of prices provided by an independent
pricing service. Prices provided by the pricing service may be determined
without exclusive reliance on quoted prices, and may reflect appropriate factors
such as yield, type of issue, coupon rate, maturity and general market
conditions. Securities for which market quotations are not readily available are
valued at fair value under the supervision of the Board of Directors. Short-term
investments that mature in 60 days or less are valued at amortized cost.
REPURCHASE AGREEMENTS: Each Fund may engage in repurchase agreement
transactions. Under the terms of a typical repurchase agreement, a Fund pays a
counterparty cash for, and takes possession of, debt obligation subject to an
obligation of the seller to repurchase, and the Fund to resell, the obligation
at an agreed-upon price and time, thereby determining the yield during the
Fund's holding period. This arrangement results in a fixed rate of return that
is not subject to market fluctuations during the Fund's holding period. The
value of the collateral held by the Fund is at least equal, at all times, to the
total amount of the repurchase obligations, including interest. In the event of
counterparty default, a Fund generally has the right to use the collateral to
offset losses incurred. There is potential loss to a Fund in the event the Fund
is delayed or prevented from exercising its rights to dispose of the collateral
securities, including the risk of a possible decline in the value of the
underlying securities during the period while the Fund seeks to assert its
rights. The Funds' investment adviser, acting under the supervision of the Board
of Directors, reviews the value of the collateral and the creditworthiness of
those banks and dealers with which the Funds enter into repurchase agreements to
evaluate potential risks.
FOREIGN CURRENCY TRANSACTIONS: A Fund will generally enter into forward
currency exchange contracts only under two circumstances. A Fund may enter into
forward currency exchange contracts when such Fund enters into a contract for
the purchase or sale of a security denominated in a foreign currency, to "lock"
in the U.S. dollar price of the security. The use of forward foreign currency
contracts does not eliminate fluctuations in the underlying prices of a Fund's
investment securities, but it does establish a rate of exchange that can be
30
<PAGE> 33
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
achieved in the future. Although forward foreign currency contracts limit the
risk of loss due to a decline in the value of a particular currency, they also
limit any potential gain that might result should the value of the currency
increase. In addition, a Fund could be exposed to risks if the counterparties to
the contracts are unable to meet the terms of their contracts. The risk exposure
to counterparties is therefore monitored. A Fund may also enter into a forward
currency exchange contract when NationsBank N.A. and/or Nations Gartmore
Investment Management ("Nations Gartmore") believes that the currency of a
particular foreign country may experience a substantial movement against another
currency. Although forward contracts will be used primarily to protect a Fund
from adverse currency movements, they also involve the risk that anticipated
currency movements will not be accurately predicted. The Funds will generally
not enter into a forward contract with a term of greater than one year.
Forward foreign currency contracts are valued at the forward rate and are
marked-to-market daily. The change in market value is recorded by a Fund as an
unrealized gain or loss. When the contract is closed, a Fund records a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
FOREIGN CURRENCY: The books and records of the Funds are maintained in
United States (U.S.) dollars. Foreign currencies, investments and other assets
and liabilities are translated into U.S. dollars at the exchange rates
prevailing at the end of the period, and purchases and sales of investment
securities, income and expenses are translated on the respective dates of such
transactions. Unrealized gains and losses on investments which result from
changes in foreign currency exchange rates have been included in the unrealized
appreciation/(depreciation) of investments. Net realized foreign currency gains
and losses resulting from changes in exchange rates include foreign currency
gains and losses between trade date and settlement date of investment securities
transactions, foreign currency transactions and the difference between the
amounts of interest and dividends recorded on the books of a Fund and the amount
actually received. The portion of foreign currency gains and losses related to
fluctuation in exchange rates between the initial purchase trade date and
subsequent sale trade date is included in realized gains and losses on
investment securities sold.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
accounted for on a trade date basis. Realized gains and losses on sales are
computed on the basis of specific identification of the securities sold.
Interest income, adjusted for amortization of discounts and premiums on
investments on the straight-line method, is earned from settlement date and is
recorded on the accrual basis. Dividend income is recorded on the ex-dividend
date, except that certain dividends from foreign securities are recorded as soon
as the Funds are informed of the ex-dividend date. Each Fund's investment income
and realized and unrealized gains and losses are allocated among the classes
based upon the relative net assets of each class.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Distributions from net
investment income, if any, for the Emerging Markets Fund and the Pacific Growth
Fund are declared and paid each calendar quarter. Dividends from net investment
income for the Global Government Income Fund are declared on each day the Fund
is open for business and paid monthly. Each Fund's net realized capital gains
(including net short-term capital gains), unless offset by any available capital
loss carryforward, are distributed to shareholders annually after the fiscal
year in which they were earned. Additional distributions of net investment
income and capital gains may be made at the discretion of the Board of Directors
in order to avoid the application of a 4% non-deductible Federal excise tax.
Income distributions and capital gain distributions on a Fund level are
determined in accordance with income tax regulations which may differ from
generally accepted accounting principles. These differences are primarily due to
timing differences and differing characterization of distributions made by a
Fund as a whole.
31
<PAGE> 34
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
INCOME TAXES: Each Fund intends to qualify as a regulated investment
company 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 earnings to shareholders. Therefore, no Federal income
tax provision is required.
EXPENSES: General expenses of Nations Portfolios are allocated to each
Fund based upon its net assets. Operating expenses directly attributable to a
class of shares are charged to that class' operations. Expenses of Nations
Portfolios not directly attributable to the operations of any class of shares or
portfolio are prorated among the classes based on the relative net assets of
each class.
2. INVESTMENT ADVISORY FEE, SUB-INVESTMENT ADVISORY FEE, ADMINISTRATION FEE AND
RELATED PARTY TRANSACTIONS.
Nations Portfolios has entered into an Investment Advisory Agreement with
NationsBank, N.A. (together with its predecessors "NationsBank"), as successor
to NationsBank of North Carolina, N.A., an indirect wholly-owned subsidiary of
NationsBank Corporation, with respect to each Fund.
Under the terms of this Investment Advisory Agreement, NationsBank is
entitled to receive an advisory fee from the Funds at the following annual rates
of the average daily net assets:
<TABLE>
<CAPTION>
ANNUAL RATE
-----------
<S> <C>
Emerging Markets Fund..................................... 1.10%
Pacific Growth Fund....................................... 0.90%
Global Government Income Fund............................. 0.70%
</TABLE>
Nations Portfolios, on behalf of the Funds also has entered into a
Sub-Investment Advisory Agreement with Nations Gartmore. Nations Gartmore is a
joint venture structured as a general partnership between NB Partners Corp., a
wholly owned subsidiary of NationsBank and Gartmore U.S. Limited, a wholly owned
subsidiary of Gartmore plc.
Under the terms of the Sub-Investment Advisory Agreement, NationsBank will
pay Nations Gartmore a fee at the following annual rates of average daily net
assets:
<TABLE>
<CAPTION>
ANNUAL RATE
-----------
<S> <C>
Emerging Markets Fund..................................... 0.85%
Pacific Growth Fund....................................... 0.70%
Global Government Income Fund............................. 0.54%
</TABLE>
Stephens Inc. ("Stephens") serves as Nations Portfolios' administrator
pursuant to an Administration Agreement. The Shareholder Services Group, Inc.
("TSSG"), an indirect wholly-owned subsidiary of First Data Corporation, serves
as Nations Portfolio's co-administrator pursuant to a Co-Administration
Agreement. Pursuant to the Administration and Co-Administration Agreements, the
administrator and co-administrator are entitled to receive a combined fee,
computed daily and paid monthly, at the annual rate of 0.10% of each Fund's
average daily net assets.
For the period ended September 30, 1995, Stephens earned $7,466 for its
services.
No officer, director or employee of NationsBank, Nations Gartmore, Stephens
or TSSG, or any affiliate thereof, receives any compensation from Nations
Portfolios for serving as Director or officer of Nations Portfolios. Nations
Portfolios pays each Director an annual fee of $1,000 ($3,000 for the Chairman
of the Board), plus $500 per Fund and an additional $1,000 for each in-person
board meeting, and $500 for each telephonic board meeting, attended. Nations
Portfolios also reimburses expenses incurred by the Directors in attending such
meetings.
32
<PAGE> 35
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
Each Fund's eligible Directors may participate in a nonqualified deferred
compensation and retirement plan which may be terminated at any time. All
benefits provided under these plans are unfunded and any payments to plan
participants are paid solely out of the Funds' assets. Income earned on each
plan participant's deferral account will be tied to the rate of return of the
eligible mutual funds selected by the participants or, if no funds are selected,
to the rate of return of the Nations Treasury Fund, a fund of Nations Fund, Inc.
Morgan Guaranty Trust Company acts as the Funds' custodian. TSSG serves as
transfer agent for the Funds' shares.
Stephens acts as the distributor of the Funds' shares. For the period ended
September 30, 1995, the Funds were informed that the distributor received
$1,017, representing commission (sales charges) on sales of Investor A Shares of
the Funds. A substantial portion of these fees were paid to affiliates of
NationsBank. For the period ended September 30, 1995, the Funds were informed
that the distributor received no contingent deferred sales charges from Investor
A, Investor C and Investor N Shareholders of the Funds.
3. SHAREHOLDER SERVICING AND DISTRIBUTION PLAN.
Nations Portfolios has adopted a shareholder servicing and distribution
plan ("Investor A Plan") pursuant to Rule 12b-1 under the 1940 Act for Investor
A Shares of each Fund. Fees payable under the Investor A Plan may not exceed
0.25%, on an annualized basis, of the average daily net assets of the Investor A
Shares of the Fund. Each Fund pays fees under the Investor A Plan directly to
the distributor. Fees paid pursuant to the Investor A Plan are charged as
expenses of Investor A Shares of such Fund as accrued.
Nations Portfolios has adopted a distribution plan pursuant to Rule 12b-1
under the 1940 Act with respect to Investor C Shares ("Investor C Plan") and
Investor N Shares ("Investor N Plan") of each Fund. Pursuant to the Plan, each
Fund pays fees directly to the distributor for certain expenses that are
incurred in connection with the support and distribution of Investor C or
Investor N Shares of such Fund. Payments under the Investor C Plan and Investor
N Plan are accrued daily and paid monthly at a rate that will not exceed 0.75%,
on an annualized basis, of the average daily net assets of the Investor C and
Investor N Shares, respectively, of each Fund. Fees paid pursuant to the
Investor C Plan and Investor N Plan are charged as expenses of Investor C and
Investor N Shares of a Fund, respectively, as accrued.
Nations Portfolios also has adopted a shareholder servicing plan with
respect to Investor C Shares ("Investor C Servicing Plan") and Investor N Shares
("Investor N Servicing Plan") of each Fund. Under the Plan, each Fund may pay
for certain shareholder support services that are provided to holders of
Investor C and Investor N Shares by servicing agents that have entered into a
shareholder servicing agreement with such Fund. Payments under the Investor C
Servicing Plan and Investor N Servicing Plan are accrued daily and paid monthly
at a rate that will not exceed 0.25% of the average daily net assets of the
Investor C and Investor N Shares of each Fund, respectively. Fees paid pursuant
to the Investor C Servicing Plan and Investor N Servicing Plan are charged as
expenses of Investor C and Investor N Shares of a Fund, respectively, as
accrued.
A substantial portion of the fees paid, pursuant to the Plans described
above, are paid to affiliates of NationsBank.
33
<PAGE> 36
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
For the period ended September 30, 1995, the Funds incurred the following
amounts pursuant to the above referenced plans:
<TABLE>
<CAPTION>
FEES PAID PURSUANT TO
---------------------------------------------------------------------------
INVESTOR A INVESTOR C INVESTOR C INVESTOR N INVESTOR N
PLAN PLAN SERVICING PLAN PLAN SERVICING PLAN
---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Emerging Markets Fund..... $ 24 $ 17 $ 5 $ 271 $ 91
Pacific Growth Fund....... 36 46 15 191 64
Global Government
Income Fund............. 7 15 5 50 16
</TABLE>
The chart below shows the effective rates, expressed as a percentage of
average daily net assets, paid by the Funds under the shareholder servicing and
distribution plans for the period ended September 30, 1995:
<TABLE>
<CAPTION>
INVESTOR A INVESTOR C INVESTOR C INVESTOR N INVESTOR N
PLAN PLAN SERVICING PLAN PLAN SERVICING PLAN
---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Emerging Markets Fund..... 0.25% 0.75% 0.25% 0.75% 0.25%
Pacific Growth Fund....... 0.25 0.75 0.25 0.75 0.25
Global Government
Income Fund............. 0.25 0.75 0.25 0.75 0.25
</TABLE>
4. PURCHASES AND SALES OF SECURITIES.
The aggregate cost of purchases and proceeds from sales of investment
securities, excluding short-term securities and U.S. government securities, for
the period ended September 30, 1995, were as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
--------------------------
<S> <C> <C>
Emerging Markets Fund........................... $13,873,044 $ 763,249
Pacific Growth Fund............................. 26,698,697 456,127
Global Government Income Fund................... 28,375,974 10,575,999
</TABLE>
The aggregate cost of purchases and proceeds from sales of long-term U.S.
government securities for the period ended September 30, 1995 was as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
------------------------
<S> <C> <C>
Global Government Income Fund..................... $6,494,625 $4,617,549
</TABLE>
At September 30, 1995, aggregate gross unrealized appreciation and
unrealized depreciation for tax purposes were as follows:
<TABLE>
<CAPTION>
TAX BASIS TAX BASIS
UNREALIZED UNREALIZED
APPRECIATION DEPRECIATION
---------------------------
<S> <C> <C>
Emerging Markets Fund......................... $480,015 $ 745,033
Pacific Growth Fund........................... 774,150 1,209,553
Global Government Income Fund................. 262,127 274,818
</TABLE>
5. CAPITAL STOCK.
As of September 30, 1995, 150,000,000,000 shares of $.001 par value capital
stock were authorized for Nations Portfolios.
34
<PAGE> 37
NATIONS FUND PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
6. ORGANIZATION COSTS.
Each Fund bears all costs in connection with its organization including the
fees and expenses of registering and qualifying its shares for distribution
under Federal and state securities regulations. All such costs are being
amortized on the straight-line method over a period of five years from the
commencement of operations of each Fund. In the event that any of the shares
issued by a Fund to their sponsor prior to the commencement of the Fund's public
offering ("initial shares") are redeemed during such amortization period, the
Fund will be reimbursed for any unamortized costs in the same proportion as the
number of shares redeemed bears to the number of initial shares outstanding at
the time of the redemption.
7. FOREIGN SECURITIES.
Each Fund may invest in foreign securities. Investing in securities of
foreign companies and foreign governments involves special risks and
considerations not typically associated with investing in U.S. companies and the
U.S. government. These risks include re-valuation of currencies, less reliable
information about issuers, different securities transaction clearance and
settlement practices, and future adverse political and economic developments.
These risks are heightened for investments in emerging markets countries.
Moreover, securities of many foreign companies and foreign governments and their
markets may be less liquid and their prices more volatile than those of
securities of comparable U.S. companies and the U.S. government.
8. SUBSEQUENT EVENT.
As of November 1, 1995, The Shareholder Services Group, Inc. will be known
as First Data Investor Services Group, Inc.
35
<PAGE> 38
THE NATIONS FUND FAMILY
EQUITY FUNDS
GROWTH
Nations Capital Growth Fund
Nations Disciplined Equity Fund
Nations Emerging Growth Fund
Nations Emerging Markets Fund
Nations Equity Index Fund*
Nations International Equity Fund
Nations Pacific Growth Fund
GROWTH AND INCOME
Nations Balanced Assets Fund
Nations Equity Income Fund
Nations Value Fund
BOND FUNDS
INCOME
Nations Diversified Income Fund
Nations Global Government Income Fund
Nations Government Securities Fund
Nations Short-Intermediate Government Fund
Nations Short-Term Income Fund
Nations Strategic Fixed Income Fund
Nations Mortgage-Backed Securities Fund*
TAX-EXEMPT INCOME
Nations Florida Municipal Bond Fund
Nations Florida Intermediate Municipal Bond Fund
Nations Georgia Municipal Bond Fund
Nations Georgia Intermediate Municipal Bond Fund
Nations Maryland Municipal Bond Fund
Nations Maryland Intermediate Municipal Bond Fund
Nations North Carolina Municipal Bond Fund
Nations North Carolina Intermediate Municipal Bond Fund
Nations South Carolina Municipal Bond Fund
Nations South Carolina Intermediate Municipal Bond Fund
Nations Tennessee Municipal Bond Fund
Nations Tennessee Intermediate Municipal Bond Fund
Nations Texas Municipal Bond Fund
Nations Texas Intermediate Municipal Bond Fund
Nations Virginia Municipal Bond Fund
Nations Virginia Intermediate Municipal Bond Fund
Nations Municipal Bond Fund
Nations Intermediate Municipal Bond Fund
Nations Short-Term Municipal Income Fund
MONEY MARKET FUNDS
Nations Government Money Market Fund
Nations Prime Fund
Nations Tax Exempt Fund
Nations Treasury Fund
* Trust classes only
<PAGE> 39
This report is submitted for the general information of shareholders of Nations
Fund Portfolios, Inc. For more detailed information about Nations Fund
Portfolios, Inc., including fees and expenses, please see the prospectus and
statement of additional information of Nations Fund Portfolios, Inc.
<PAGE> 40
NATIONS
- ------- FUND -- BULK RATE
U.S. POSTAGE
PO Box 9654 PAID
Providence, RI 02940-9654 BOSTON, MA
Toll Free 1-800-982-2271 PERMIT NO.
54201
SAR6-9/95
