<PAGE> 1
NATIONS
FUND
INTERNATIONAL
FUNDS
Semi Annual Report for the Period Ended September 30, 1996
NATIONS
FUND
[LOGO]
<PAGE> 2
<TABLE>
<S> <C>
NOT
FDIC- MAY LOSE VALUE
INSURED NO BANK GUARANTEE
</TABLE>
NATIONS FUND DISTRIBUTOR: STEPHENS INC. STEPHENS INC., WHICH IS NOT AFFILIATED
WITH NATIONSBANK, N.A., 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: NATIONSBANC ADVISORS, INC.
NATIONS FUND INVESTMENT SUB-ADVISERS: TRADESTREET INVESTMENT ASSOCIATES, INC.
AND GARTMORE GLOBAL PARTNERS.
<PAGE> 3
NATIONS FUND
DEAR SHAREHOLDER:
Financial assets, particularly U.S. equity securities, have continued to produce
solid returns through the first nine months of 1996. As we anticipated six
months ago, the returns have been less spectacular than in 1995 and have been
accompanied by greater volatility. After selling off sharply in the first part
of the year, taxable bonds have traded in a broad range for the past six months.
Meanwhile, municipal securities have enjoyed better total returns than their
taxable counterparts. International equity securities have produced positive
returns, although these equities have generally lagged their domestic
counterparts.
Throughout the current year, investors have had no lack of issues to worry about
- -- the level of economic activity, Federal Reserve Board (the "Fed") policies,
corporate profits, inflation and domestic politics. Despite the periodic
worries, none of these issues have manifested themselves into overwhelming
problems. The economy has neither accelerated at an unacceptable pace, nor
fallen into recession. The Fed's policies have been steady. Corporate profits
have not achieved 1995's strong gains, but have increased at a reasonable pace.
Inflation remains tame, despite strong job growth and low unemployment.
Moreover, the political season has done little to unsettle the markets. Despite
the election year, Congress produced a timely and sensible budget for fiscal
year 1997.
Outside the U.S. there is much less concern about economies overheating. In both
Europe and Japan, the focus has been on stimulating economic growth and, to this
end, governments have been following loose monetary policies. Provided earnings
continue their strong recovery in these regions, the environment for foreign
equity securities looks very encouraging. Pacific Rim economies have slowed this
year from the exceptionally strong growth over the past few years. Although the
region's slower growth in exports along with tighter monetary policies have had
a negative impact on certain markets, they also have reduced the overheating
inflationary problems which occurred across the region as a result of the
exceptional growth.
Looking ahead, there are strong prospects for a return to higher growth in Asia
next year as central banks begin to ease monetary policies and economic activity
picks up outside Asia, particularly in Europe and Japan. Unlike in the U.S.,
bond yields have actually fallen in many overseas markets and equity valuations
remain generally low in relation to bonds.
The final months of 1996 and the early part of 1997 are unlikely to bring
closure to any of the issues described above. Investors will continue to be edgy
about the prospects for the U.S. economy, inflation and profits. Moreover, we
will continue to hear strong opinions expressed on the future course of the Fed,
and the political landscape after the election. Despite all the worries and
rhetoric, we think the pattern of the last several years will continue to hold
true. Investor apprehension will, from time to time, lead to market volatility.
However, moderate economic growth, stable inflation and modest profits should,
in our view, produce a reasonable investment environment as we move into the new
year.
Sincerely,
/s/ A. Max Walker
A. Max Walker
President and Chairman
of the Board
September 30, 1996
1
<PAGE> 4
THE NATIONS FUND ADVANTAGE
A family of mutual funds provides investors with a number of advantages,
including the ability to shift investment assets among funds as their financial
objectives change. The Nations Fund family of mutual funds includes a broad
array of professionally managed domestic and international stock, bond and money
market funds advised by NationsBanc Advisors, Inc. The family is designed to
accommodate a wide variety of investment objectives across the risk/reward
spectrum.
[GRAPHIC]
For specific information on developing an investment portfolio that will more
closely target your investment objectives, contact your investment
representative or Nations Fund for fund brochures and prospectuses at (800)
982-2271.
- ---------------
* The Nations Fund family includes Nations Equity Index Fund, which seeks
investment results that correspond, before fees and expenses, to the total
return of the S&P 500 Index, and Nations Managed Index Fund, which seeks, over
the long-term to provide a total return which (gross of fees and expenses)
exceeds the total return of the S&P 500.
2
<PAGE> 5
NATIONS FUND
Nations International Equity Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
COMMON STOCKS -- 94.4%
ARGENTINA -- 0.4%
190,000 Perez Compac, ADR.................. $ 2,399,700
55,000 Y.P.F Sociedad Anonima, ADR........ 1,258,125
------------
3,657,825
------------
AUSTRALIA -- 2.0%
1,250,000 Australia & New Zealand Bank
Group............................ 7,154,540
250,000 Broken Hill Property............... 3,206,184
365,500 CRA Ltd. .......................... 5,497,616
2,000,000 Fosters Brewing Group.............. 3,594,092
------------
19,452,432
------------
BELGIUM -- 0.7%
20,000 Generale de Banque NPV............. 6,902,036
------------
BRAZIL -- 0.6%
200,000 Aracruz Celulose SA, ADR........... 1,750,000
60,000 CEMIG Companhia, New, ADR.......... 1,785,000
25,000 Telebras, ADR...................... 1,962,500
------------
5,497,500
------------
CHILE -- 0.5%
25,000 Cia de Telecomunicaciones de Chile
SA, ADR.......................... 2,415,625
75,000 Enersis SA, ADR.................... 2,418,750
------------
4,834,375
------------
FRANCE -- 6.0%
84,000 BIC................................ 11,025,457
17,000 Carrefour.......................... 9,540,800
66,202 Compagnie de Saint-Gobain.......... 8,971,329
22,000 L'Oreal............................ 7,453,296
42,000 LVHM Moet Hennessey................ 9,114,703
169,099 TOTAL, "B" Shares ord.............. 13,307,278
------------
59,412,863
------------
GERMANY -- 7.1%
325,000 Bayer AG........................... 11,919,576
225,000 Daimler-Benz AG+................... 12,363,285
200,000 Hoechst AG......................... 7,293,208
35,000 Lufthansa.......................... 4,985,592
26,000 Mannesmann AG...................... 9,739,996
195,000 RWE AG............................. 7,356,081
45,000 SGL Carbon AG...................... 5,245,923
235,000 Veba AG............................ 12,297,138
------------
71,200,799
------------
GREAT BRITAIN -- 11.9%
900,000 Allied Irish Banks ord............. 5,318,108
466,667 Argos ord.......................... 5,485,856
375,000 Barclays plc ord................... 5,511,814
475,000 Bass ord........................... 5,795,720
350,000 BOC Group plc...................... 4,796,472
600,000 BPB Industries ord................. 3,512,534
480,000 British Airport Authority ord...... 3,711,640
325,000 British Land Company plc ord....... 2,319,775
657,566 British Petroleum Company ord...... 6,824,182
800,000 British Telecommunications ord..... 4,464,237
600,000 BTR ord............................ 2,540,483
175,000 Cable & Wireless ord............... 1,228,565
500,000 Electra Investment Trust plc ord... 3,228,432
500,000 E.M.A.P. ord....................... 5,858,137
350,000 Enterprise Oil ord................. 2,983,071
1,000,000 Fleming Merchantile Investment
Trust plc ord.................... 5,267,236
490,000 General Accident plc ord........... 5,223,251
160,000 Glaxo Wellcome plc ord............. 2,508,237
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
GREAT BRITAIN -- (CONTINUED)
500,000 Guinness ord....................... $ 3,580,625
150,000 Kingfisher ord..................... 1,487,427
110,000 Land Securities plc ord............ 1,200,116
550,000 Marks & Spencer ord................ 4,274,444
500,000 Provident Financial plc ord........ 3,854,552
550,000 Reuters Holdings ord............... 6,357,859
1,500,000 Rolls Royce plc ord................ 5,623,342
125,000 Scottish & Newcastle Breweries
ord.............................. 1,311,917
407,600 Smithkline Beecham "A" ord......... 4,979,718
125,000 Unilever ord....................... 2,673,729
350,000 United Utilities ord............... 3,125,514
300,000 Wolseley ord....................... 2,282,208
75,000 Zeneca Group plc ord............... 1,864,273
------------
119,193,474
------------
HONG KONG -- 5.8%
910,000 Cheung Kong Holdings............... 7,001,810
2,150,000 China Light & Power................ 10,009,052
1,800,000 Dao Heng Bank Group................ 7,099,444
1,650,000 Hong Kong Land Holdings............ 3,844,500
2,550,000 Hong Kong Telecommunications....... 4,616,578
308,323 HSBC Holdings plc.................. 5,721,499
375,000 Jardine Matheson Holdings.......... 2,343,750
610,000 Jardine Strategic Holdings......... 1,939,800
590,000 Sun Hung Kai Properties............ 6,275,378
625,000 Swire Pacific, "A" Shares.......... 5,596,955
900,000 Wharf (Holdings) Ltd. ............. 3,724,298
------------
58,173,064
------------
INDIA -- 0.1%
95,000 Reliance Industries Ltd., GDS...... 1,009,850
------------
INDONESIA -- 1.1%
1,671,000 PT Indofood Sukses Makmur,
Alien Shares+.................... 3,560,676
110,000 PT Indonesian Satellite, ADR,
"B" Class........................ 3,630,000
1,100,000 PT Indorayon Utama, Alien Shares... 958,889
1,000,000 Semen Cibinong, Alien Shares....... 2,582,867
------------
10,732,432
------------
ITALY -- 2.5%
750,000 Ente Nazionale Idrocarburi Spa..... 3,833,087
70,700 Gucci Group........................ 5,125,750
440,000 Rinascente......................... 2,671,919
1,700,000 Telecom Italia..................... 3,777,778
4,500,000 Telecom Italia Mobile.............. 9,985,229
------------
25,393,763
------------
JAPAN -- 29.9%
40,000 Autobacs Seven Company............. 3,522,666
273,000 Canon Sales Company................ 7,410,769
350,000 Dai-ichi Kangyo Bank............... 5,895,001
750 DDI Corporation.................... 6,054,023
125,000 Dia Kensetsu Company Ltd. ......... 1,444,634
1,000 East Japan Railway Company......... 4,819,925
500,000 Hitachi Ltd. ...................... 4,837,843
450,000 Kajima Corporation................. 4,152,482
760,000 Kirin Brewery Company.............. 8,442,931
100,000 Mandom............................. 1,612,614
358,000 Marui Company...................... 6,895,718
550,000 Matsushita Electric Industrial..... 9,214,299
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
3
<PAGE> 6
NATIONS FUND
Nations International Equity Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
JAPAN -- (CONTINUED)
125,000 Mitsuba Corporation................ $ 1,377,441
700,000 Mitsubishi Electric Corporation.... 4,766,171
575,000 Mitsubishi Estate Company.......... 7,881,652
990,000 Mitsubishi Heavy Industries........ 8,044,526
865,000 Mitsui Fudosan Company............. 11,469,271
90,000 Miura.............................. 1,451,353
680,000 NCR Japan Ltd. .................... 6,884,071
100,000 Nichiei Company Ltd. .............. 6,575,882
915,000 Nippon Express Company Ltd. ....... 8,361,405
200,000 Nippon Hi-Pack Company............. 1,585,737
1,500,000 Nippon Oil Company................. 9,151,586
1,850,000 Nippon Sanso....................... 8,287,045
2,500,000 Nippon Steel....................... 7,749,507
1,400 Nippon Telephone & Telegraph
Corporation...................... 10,284,895
2,000,000 Nippon Yusen....................... 10,392,403
355,000 Nomura Securities Company.......... 6,519,889
1,150,000 NTN Corporation.................... 7,819,835
1,150,000 OJI Paper Company (New)............ 8,705,877
185,000 Ono Pharmaceutical Company......... 6,016,395
700,000 Ricoh Company...................... 7,149,256
400,000 Sekisui House...................... 4,371,976
950,000 Shimizu Construction Company....... 9,362,121
510,000 Shizuoka Bank...................... 6,031,177
150,000 Shochiku Company................... 1,599,176
150,000 Sony Corporation................... 9,447,232
550,000 Sumitomo Trust & Bank.............. 6,898,405
165,000 TDK Corporation.................... 10,244,132
1,500,000 Teijin............................. 7,552,410
200,000 Tokio Marine & Fire Insurance
Company.......................... 2,365,168
475,000 Tokyo Broadcasting Systems Inc..... 7,702,473
325,000 Tokyo Electric Power Company....... 7,861,494
350,000 Tostem Corporation................. 10,347,608
250,000 Yamaha Motors Company.............. 2,418,921
1,170,000 Yasuda Fire & Marine Insurance..... 8,092,098
------------
299,071,493
------------
MALAYSIA -- 4.0%
499,900 Genting Berhad..................... 3,629,979
1,850,000 Land & General Berhad.............. 3,948,891
600,000 Malayan Banking Berhad............. 5,960,741
2,350,000 Malaysian Resources................ 7,969,598
700,000 Perusahaan Otomobil Nasional....... 3,798,276
450,000 Resorts World Berhad............... 2,549,473
350,000 Telekom Malaysia................... 3,086,100
750,000 Tenaga Nasional Berhad............. 2,633,259
800,000 United Engineers (Malaysia)
Berhad........................... 6,192,148
------------
39,768,465
------------
MEXICO -- 0.2%
100,000 Carso Global Telecom, ADR+......... 575,000
100,000 Grupo Carso SA de CV, ADR++........ 919,000
100,000 Invercorporacion SA+............... 13,374
------------
1,507,374
------------
VALUE
SHARES (NOTE 1)
------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
NETHERLANDS -- 5.6%
165,000 ABN Amro Holding N.V............... $ 9,141,514
700,000 Elsevier N.V....................... 11,565,182
375,000 Fortis Amev N.V.................... 11,209,061
100,000 Polygram........................... 5,592,854
50,000 Royal Dutch Petroleum.............. 7,808,395
80,000 Wolters Kluwer..................... 10,055,462
------------
55,372,468
------------
PERU -- 0.1%
49,000 Telefonica del Peru SA, Class B,
ADR.............................. 1,120,875
------------
PHILIPPINES -- 0.6%
100,000 Philippine Long Distance Telephone
Company, ADR..................... 6,250,000
------------
SINGAPORE -- 2.8%
500,000 Development Bank of Singapore,
Alien Shares..................... 6,142,593
700,000 Keppel Corporation................. 5,418,264
363,000 Overseas Chinese Banking
Corporation, Alien Shares........ 4,356,412
300,000 Singapore Airlines, Alien Shares... 3,025,138
252,000 Singapore Press Holdings, Alien
Shares........................... 4,599,063
900,000 Straits Steamship Land Ltd. ....... 2,939,923
1,160,000 United Overseas Land............... 1,828,718
------------
28,310,111
------------
SOUTH KOREA -- 1.3%
67,005 Hyundai Engineering and
Construction Company+............ 2,060,444
3,901 Hyundai Engineering and
Construction Company, New........ 112,874
70,000 Korea Electric Power Corporation... 2,313,559
400,000 Korea First Bank................... 2,886,199
95,000 LG Electronics Inc................. 1,656,174
35,000 Samsung Company, Non-Voting Shares,
GDS+............................. 870,800
637 Samsung Electronics Ltd.,
Common+.......................... 49,973
316 Samsung Electronics Ltd., ADR...... 14,062
1,050 Samsung Electronics Ltd., GDR++.... 52,374
10,548 Samsung Electronics Ltd., New,
GDS++............................ 247,878
191 Samsung Electronics Ltd., New,
Refunding 01/01/1997............. 14,383
120,000 Yukong Ltd., Common................ 3,050,847
------------
13,329,567
------------
SPAIN -- 1.3%
35,000 Banco Popular de Espanol SA........ 6,429,016
287,170 Centros Comerciales Pryca.......... 7,007,145
------------
13,436,161
------------
SWEDEN -- 2.4%
400,000 Atlas Copco AB "B"................. 8,203,272
385,000 Ericsson (L.M.) Telephone Company,
Class B.......................... 9,695,393
275,000 Sandvik AB......................... 6,510,593
------------
24,409,258
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
4
<PAGE> 7
NATIONS FUND
Nations International Equity Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
SWITZERLAND -- 5.7%
5,000 ABB AB............................. $ 6,110,823
15,500 Ciba Geigy AG...................... 19,807,991
8,750 Nestle SA.......................... 9,745,847
1,700 Roche Holdings AG.................. 12,508,067
33,000 Zurich Versicherungs............... 9,123,212
------------
57,295,940
------------
TAIWAN -- 0.2%
109,000 Evergreen Marine Corporation,
GDR+............................. 2,032,850
------------
THAILAND -- 1.6%
250,000 Advanced Information Services
Public Company Ltd., Alien
Shares........................... 3,421,023
225,000 Bangkok Bank Public Company Ltd.,
Alien Shares..................... 2,937,360
80,000 Siam Cement Public Company Ltd.,
Alien Shares..................... 3,259,015
485,000 Thai Farmers Bank Public Company
Ltd., Alien Shares............... 5,111,085
675,000 Thai Telephone &
Telecommunications, Alien
Shares+.......................... 1,154,595
------------
15,883,078
------------
TOTAL COMMON STOCKS
(Cost $848,799,594).............. 943,248,053
===========
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
--------------
<C> <S> <C>
CONVERTIBLE BONDS -- 1.6%
JAPAN -- 1.5%
USD 7,700,000 MBL International Finance
Bermuda, Conv.,
3.000% 1/30/02.............. 8,696,380
JPY 600,000,000 Sumitomo Bank International
Finance, Conv.,
0.750% 05/31/01............. 5,859,165
------------
14,555,545
------------
TAIWAN -- 0.1%
USD 875,000 United Microelectronics,
Conv.,
1.250% 06/08/04............. 1,060,938
------------
TOTAL CONVERTIBLE BONDS
(Cost $15,078,380).......... 15,616,483
===========
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
INVESTMENT FUND -- 0.3% (Cost $2,501,405)
TAIWAN -- 0.3%
212,393 Taiwan American Fund Ltd. .... $ 2,654,913
===========
PREFERRED STOCKS -- 0.1%
SOUTH KOREA -- 0.1%
75,000 LG Electronics Inc............ 753,632
15,000 Samsung Electronics Ltd. ..... 577,482
4,520 Samsung Electronics Ltd.,
Refunding 01/01/97.......... 158,145
------------
TOTAL PREFERRED STOCKS
(Cost $3,322,270)........... 1,489,259
===========
WARRANTS -- 0.0%#
ITALY -- 0.0%#
22,000 Rinascente, Expire
12/31/99+................... 10,832
------------
SINGAPORE -- 0.0%#
225,000 Straits Steamship Land Ltd.,
Expire 12/20/00+............ 271,623
116,000 United Overseas Land, Expire
05/28/01+................... 51,073
------------
322,696
------------
THAILAND -- 0.0%#
60,625 Thai Farmers Bank Public
Company Ltd.,
Expire 09/15/02+............ 162,105
------------
TOTAL WARRANTS
(Cost $477,253)............. 495,633
============
RIGHTS -- 0.0%#
BELGIUM -- 0.0%#
20,000 Generale de Banque+........... 43,257
------------
SOUTH KOREA -- 0.0%#
7,524 Yukong Ltd.+.................. 30,970
------------
TOTAL RIGHTS
(Cost $126,984)............. 74,227
============
TOTAL INVESTMENTS
(Cost $870,305,886*).................. 96.4% 963,578,568
OTHER ASSETS AND
LIABILITIES (NET)..................... 3.6 35,427,720
----- ------------
NET ASSETS.............................. 100.0% $999,006,288
===== ============
</TABLE>
- ---------------
* 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, normally to
qualified institutional buyers.
# Amount represents less than 0.1%.
ABBREVIATIONS:
ADR American Depositary Receipt
Conv. Convertible
GDR Global Depositary Receipt
GDS Global Depositary Share
ord Ordinary Shares
SEE NOTES TO FINANCIAL STATEMENTS.
5
<PAGE> 8
NATIONS FUND
Nations International Equity Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1996 (UNAUDITED)
AT SEPTEMBER 30, 1996 SECTOR DIVERSIFICATION WAS AS FOLLOWS:
<TABLE>
<CAPTION>
% OF NET VALUE
SECTOR DIVERSIFICATION ASSETS (NOTE 1)
<S> <C> <C>
- --------------------------------------------------------------------------------------------------------
COMMON STOCKS:
Finance...................................................................... 24.8% $247,824,013
Services..................................................................... 21.3 212,623,759
Capital Goods................................................................ 13.9 139,021,167
Capital Equipment............................................................ 12.5 124,963,486
Materials.................................................................... 12.4 123,769,387
Energy....................................................................... 9.5 95,046,241
-------- ------------
TOTAL COMMON STOCKS.......................................................... 94.4 943,248,053
CONVERTIBLE BONDS............................................................ 1.6 15,616,483
INVESTMENT FUND.............................................................. 0.3 2,654,913
PREFERRED STOCKS............................................................. 0.1 1,489,259
WARRANTS..................................................................... 0.0# 495,633
RIGHTS....................................................................... 0.0# 74,227
-------- ------------
TOTAL INVESTMENTS............................................................ 96.4 963,578,568
OTHER ASSETS AND LIABILITIES (NET)........................................... 3.6 35,427,720
-------- ------------
NET ASSETS................................................................... 100.0% $999,006,288
======== ============
</TABLE>
- ---------------
# Amount represents less than 0.1%.
SEE NOTES TO FINANCIAL STATEMENTS.
6
<PAGE> 9
NATIONS FUND
Nations International Equity Fund
- --------------------------------------------------------------------------------
SCHEDULE OF FORWARD FOREIGN EXCHANGE CONTRACTS SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
CONTRACT TO BUY NET UNREALIZED
--------------------------------------------------- APPRECIATION/
LOCAL VALUE IN IN EXCHANGE (DEPRECIATION)
MATURITY DATE CURRENCY U.S. $ FOR U.S. $ OF CONTRACT
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------
10/01/96 3,988,352 MYR.................. $ 1,591,267 $ 1,595,979 $ (4,712)
10/02/96 3,730,513 MYR.................. 1,488,383 1,492,802 (4,419)
10/15/96 592,713 GBP.................. 927,603 926,292 1,311
11/27/96 500,000,000 JPY.................. 4,516,410 4,602,145 (85,735)
-------------
$ (93,555)
-------------
</TABLE>
<TABLE>
<CAPTION>
CONTRACT TO SELL NET UNREALIZED
--------------------------------------------------- APPRECIATION/
LOCAL VALUE IN IN EXCHANGE (DEPRECIATION)
MATURITY DATE CURRENCY U.S. $ FOR U.S. $ OF CONTRACT
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------
10/01/96 610,829 PTS.................. $ 4,754,276 $ 4,802,118 $ 47,842
11/27/96 6,600,000 CHF.................. 5,292,766 5,296,950 4,184
11/27/96 108,000,000 FRF.................. 20,975,122 20,819,678 (155,444)
11/27/96 56,000,000 FRF.................. 10,875,988 10,957,243 81,255
11/27/96 1,150,000,000 JPY.................. 10,387,743 11,036,468 648,725
11/27/96 3,200,000,000 JPY.................. 28,905,023 30,680,729 1,775,706
11/27/96 3,150,000,000 JPY.................. 28,453,382 30,231,777 1,778,395
-------------
$4,180,663
-------------
Net Unrealized Appreciation of Forward Foreign Exchange Contracts.................. $4,087,108
============
</TABLE>
ABBREVIATIONS OF CURRENCY
THAT ISSUE IS HELD IN:
CHF Swiss Franc
FRF French Franc
GBP Great Britain Pound
JPY Japanese Yen
MYR Malaysian Ringgit
PTS Spanish Peseta
USD United States Dollar
SEE NOTES TO FINANCIAL STATEMENTS.
7
<PAGE> 10
NATIONS FUND
Nations Pacific Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
COMMON STOCKS -- 87.7%
AUSTRALIA -- 0.4%
125,000 Skilled Engineering Ltd. ......... $ 444,314
------------
HONG KONG -- 31.5%
2,760,000 Chaifa Holdings Ltd. ............. 794,129
408,000 Cheung Kong Holdings Ltd. ........ 3,139,273
428,000 Dao Heng Bank Group............... 1,688,090
160,000 Hang Seng Bank Ltd. .............. 1,696,625
50,000 Henderson China Holding Ltd. ..... 113,798
360,000 Henderson Land Development
Company......................... 3,084,185
418,000 Hong Kong Electric Holdings
Ltd. ........................... 1,351,351
578,000 Hong Kong Land Holdings, ord...... 1,346,740
900,000 Hong Kong Telecommunications...... 1,629,381
260,800 HSBC Holdings plc................. 4,839,622
560,000 Hutchinson Whampoa Ltd. .......... 3,765,679
218,800 Jardine Matheson Holdings......... 1,367,500
351,000 New World Development Company..... 1,842,829
400,000 Road King Infrastructure Ltd.+.... 331,049
980,000 Shangri-La Asia................... 1,305,315
319,000 Sun Hung Kai Properties........... 3,392,959
280,000 Swire Pacific..................... 2,507,436
360,000 Wharf (Holdings) Ltd. ............ 1,489,719
------------
35,685,680
------------
INDONESIA -- 5.4%
930,000 Bank Dagang Nasional Indonesia,
Alien Shares.................... 670,577
1,140,000 Citra Marga Nusadhala Persada,
Alien Shares.................... 772,923
143,000 Hanjaya Mandala Sampoerna, Alien
Shares.......................... 1,391,218
50,000 PT Bank Internasional Indonesia... 73,181
37,000 PT Indonesian Satellite, "B"
Class, ADR...................... 1,221,000
17,000 PT Telekomunikasi Indonesia,
ADR............................. 529,125
155,000 Semen Gresik...................... 460,396
325,000 Semen Gresik, Alien Shares........ 965,346
------------
6,083,766
------------
MALAYSIA -- 19.5%
148,000 Amway (Malaysia) Holdings
Berhad+......................... 832,589
718,000 Bandar Raya Development Berhad.... 1,254,724
460,000 Development & Commercial Bank
Holdings Corporation............ 1,578,359
119,000 Diperdana Corporation Berhad...... 940,073
318,000 Gadek Capital Berhad+............. 932,534
103,000 Genting Berhad.................... 747,925
118,000 Integrated Logistics Berhad....... 294,247
278,000 Konsortium Perkapalan............. 1,807,932
218,000 Malayan Banking Berhad............ 2,165,736
349,000 Malaysian Resources............... 1,183,570
78,000 Mancon Berhad..................... 669,087
260,000 New Straits Time.................. 1,369,295
180,000 Perusahaan Otomobil Nasional...... 976,700
403,000 Petronas Dagangan Berhad.......... 1,197,873
338,000 Rashid Hussain Berhad............. 1,874,481
220,000 Renong Berhad..................... 337,057
319,000 RJ Reynolds Berhad................ 910,010
160,000 Telekom Malaysia.................. 1,410,788
80,000 Timah Lagnat Berhad............... 414,938
143,000 United Engineers (Malaysia)
Berhad.......................... 1,106,846
------------
22,004,764
------------
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
PHILIPPINES -- 4.9%
735,000 Ayala Corporation, Class B........ $ 840,480
900,000 Ayala Land Inc., Class B.......... 1,097,770
1,030,000 DMCI Holdings Inc. ............... 765,580
198,000 First Philippine Holdings, Class
B............................... 430,189
1,327,000 Hi Cement Corporation+............ 452,830
17,000 Philippine Long Distance Telephone
Company......................... 1,056,223
300,000 Philippino Telephone
Corporation+.................... 411,664
183,600 Security Bank Corporation+........ 454,889
------------
5,509,625
------------
SINGAPORE -- 11.6%
104,000 City Developments Ltd. ........... 886,238
144,000 Development Bank of Singapore,
Alien Shares.................... 1,769,067
268,000 Far East Levingston
Shipbuilding.................... 1,265,587
139,000 Fraser & Neave.................... 1,431,260
660,000 Hotel Properties.................. 1,077,972
107,000 Keppel Corporation Ltd. .......... 828,220
218,000 Sembawang Corporation Ltd. ....... 1,021,730
116,000 Singapore Airlines, Alien
Shares.......................... 1,169,720
580,000 Straits Steamship Land Ltd. ...... 1,894,617
440,000 Sunright Ltd. .................... 381,196
143,000 United Overseas Bank, Alien
Shares.......................... 1,391,209
------------
13,116,816
------------
SOUTH KOREA -- 7.3%
10,000 Daehan City Gas Company........... 811,138
2,222 Dong Ah Construction Industries,
EDR............................. 29,453
40,000 Dongkuk Steel Mill Company+....... 774,818
24,300 Hyundai Engineering & Construction
Company+........................ 747,240
1,414 Hyundai Engineering & Construction
Company, New.................... 40,914
47,000 Koram Bank........................ 591,768
18,000 Korea Electric Power
Corporation..................... 594,915
38,450 Korea Electric Power Corporation,
ADR............................. 725,744
38,000 Korea Exchange Bank............... 437,506
77,000 Kyung Nam Bank.................... 978,814
7,800 Samsung Display Devices Company... 484,431
9,000 Samsung Electronics Ltd.+......... 706,053
286 Samsung Electronics Ltd., ADR+.... 12,727
86 Samsung Electronics Ltd.,
GDR++ +......................... 4,290
31,000 Samsung Securities Company........ 855,690
19,000 Yukong Ltd., Common............... 483,050
------------
8,278,551
------------
TAIWAN -- 0.8%
27,300 Evergreen Marine Corporation,
GDR............................. 509,145
57,000 Siliconware Precision Industries
Company, GDR+................... 457,140
------------
966,285
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
8
<PAGE> 11
NATIONS FUND
Nations Pacific Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
THAILAND -- 6.3%
49,000 Advanced Information Services
Public Company Ltd., Alien
Shares.......................... $ 670,520
38,000 Ban Pu Public Company Ltd., Alien
Shares.......................... 830,797
30,000 Bangkok Bank Public Company Ltd.,
Alien Shares.................... 391,648
35,000 Grammy Entertainment,
Alien Shares.................... 418,387
168,000 Krung Thai Bank, Alien Shares..... 720,066
236,600 Nation Multimedia Group plc, Alien
Shares.......................... 804,762
30,000 Phatra Thanakit Company, Alien
Shares.......................... 171,051
93,000 PTT Exploration and Production
Public Company Ltd.,
Alien Shares.................... 1,375,015
82,200 Thai Farmers Bank Public Company
Ltd., Alien Shares.............. 866,250
123,000 Total Access Communications
(CLOB).......................... 910,200
------------
7,158,696
------------
TOTAL COMMON STOCKS
(Cost $93,975,536).............. 99,248,497
===========
INVESTMENT FUNDS -- 3.9%
TAIWAN -- 3.9%
90,000 New Taipai Fund Ltd. ............. 1,248,750
8,000 Taipei Fund, Class B Units........ 672,000
130,553 Taiwan American Fund Ltd. ........ 1,599,274
37,000 Taiwan Fund Inc................... 855,625
------------
TOTAL INVESTMENT FUNDS
(Cost $4,138,143)............... 4,375,649
===========
<CAPTION>
PRINCIPAL
AMOUNT
- -----------
CONVERTIBLE BONDS -- 2.3%
HONG KONG -- 0.4%
USD 480,000 Henderson Capital International,
5.000% due 03/28/97............. 415,800
------------
PHILIPPINES -- 0.4%
USD 480,000 PilTel International Holding
Corporation,
1.750% due 07/17/06............. 491,520
------------
TAIWAN -- 0.6%
USD 80,000 Acer Inc.,
4.000% due 06/10/01............. 215,600
USD 300,000 President Enterprise Corporation,
Zero coupon 07/22/01............ 467,250
------------
682,850
------------
THAILAND -- 0.9%
USD 900,000 Bangkok Bank,
3.250% due 03/03/04............. 1,003,500
------------
TOTAL CONVERTIBLE BONDS
(Cost $2,660,569)............... 2,593,670
===========
U.S. TREASURY BILL -- 0.7% (Cost $830,122)
USD 850,000 U.S. Treasury Bill,
5.040% 03/13/97................. 830,122
===========
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
WARRANTS -- 0.1%
SINGAPORE -- 0.1%
51,250 Straits Steamship Land Ltd.,
Expire 12/12/00+................ $ 61,870
------------
THAILAND -- 0.0%#
10,275 Thai Farmers Bank Public Company
Ltd., Expire 09/15/02+.......... 27,474
------------
TOTAL WARRANTS
(Cost $90,677).................. 89,344
===========
RIGHTS -- 0.0%#
SOUTH KOREA -- 0.0%# (Cost $9,180)
1,191 Yukong Ltd., Expire 10/24/96+..... 4,904
===========
<CAPTION>
NUMBER OF
CONTRACTS
<C> <S> <C>
- -----------
CALL OPTIONS PURCHASED -- 0.8% (Cost $864,934)
TAIWAN -- 0.8%
7,215 Taiwan Weighted Index Call
Options, $117.807, March
1997+........................... 887,445
============
TOTAL INVESTMENTS
(Cost $102,569,161*).................. 95.5% 108,029,631
OTHER ASSETS AND
LIABILITIES (NET)..................... 4.5 5,055,001
----- ------------
NET ASSETS.............................. 100.0% $113,084,632
===== ============
</TABLE>
- ---------------
* 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%.
ABBREVIATIONS:
ADR American Depositary Receipt
CLOB Custody License Outside Border
EDR European Depositary Receipt
GDR Global Depositary Receipt
GDS Global Depositary Share
ord Ordinary Shares
SEE NOTES TO FINANCIAL STATEMENTS.
9
<PAGE> 12
NATIONS FUND
Nations Pacific Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1996 (UNAUDITED)
AT SEPTEMBER 30, 1996 SECTOR DIVERSIFICATION WAS AS FOLLOWS:
<TABLE>
<CAPTION>
% OF NET VALUE
SECTOR DIVERSIFICATION ASSETS (NOTE 1)
<S> <C> <C>
- --------------------------------------------------------------------------------------------------------
COMMON STOCKS:
Services..................................................................... 17.5% $ 19,850,726
Real Estate.................................................................. 17.5 19,794,620
Finance...................................................................... 16.3 18,494,062
Banking...................................................................... 15.3 17,250,714
Energy....................................................................... 6.5 7,369,883
Capital Goods................................................................ 6.4 7,197,381
Capital Equipment............................................................ 5.9 6,637,721
Materials.................................................................... 2.3 2,653,390
-------- ------------
TOTAL COMMON STOCKS.......................................................... 87.7 99,248,497
INVESTMENT FUNDS............................................................. 3.9 4,375,649
CONVERTIBLE BONDS............................................................ 2.3 2,593,670
U.S. TREASURY BILL........................................................... 0.7 830,122
WARRANTS..................................................................... 0.1 89,344
RIGHTS....................................................................... 0.0# 4,904
CALL OPTIONS PURCHASED....................................................... 0.8 887,445
-------- ------------
TOTAL INVESTMENTS............................................................ 95.5 108,029,631
OTHER ASSETS AND LIABILITIES (NET)........................................... 4.5 5,055,001
-------- ------------
NET ASSETS................................................................... 100.0% $113,084,632
======== ============
</TABLE>
- ---------------
# Amount represents less than 0.1%.
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE> 13
NATIONS FUND
Nations Pacific Growth Fund
<TABLE>
- --------------------------------------------------------------------------------------
SCHEDULE OF FORWARD FOREIGN EXCHANGE CONTRACTS SEPTEMBER 30, 1996 (UNAUDITED)
<CAPTION>
CONTRACT TO BUY
------------------------------------------------------ IN
VALUE EXCHANGE NET UNREALIZED
LOCAL IN FOR DEPRECIATION
MATURITY DATE CURRENCY U.S. $ U.S. $ OF CONTRACT
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------
10/01/96 925,325 PHP......................... $35,271 $35,331 $ (60)
10/01/96 103,979,645 IDR......................... 44,761 44,877 (116)
10/03/96 2,423,749 PHP......................... 92,383 93,545 (1,162)
10/04/96 204,855 PHP......................... 7,808 7,819 (11)
-----------
$ (1,349)
-----------
</TABLE>
<TABLE>
<CAPTION>
CONTRACT TO SELL
------------------------------------------------------ IN
VALUE EXCHANGE NET UNREALIZED
LOCAL IN FOR APPRECIATION
MATURITY DATE CURRENCY U.S. $ U.S. $ OF CONTRACT
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------
10/01/96 67,099 MYR........................ $26,771 $26,807 $ 36
-----------
Net Unrealized Depreciation of Forward Foreign Exchange Contracts................. $ (1,313)
===========
</TABLE>
ABBREVIATIONS OF CURRENCY
THAT ISSUE IS HELD IN:
IDR Indonesian Rupiah
MYR Malaysian Ringgit
PHP Philippine Peso
USD United States Dollar
SEE NOTES TO FINANCIAL STATEMENTS.
11
<PAGE> 14
NATIONS FUND
Nations Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
COMMON STOCKS -- 82.8%
ARGENTINA -- 3.8%
160,664 Astra Cia Argentina de Petroleo
SA............................... $ 258,712
11,700 Buenos Aires Embotelladora SA, ADR... 67,275
8,000 Irsa Inversiones Y
Representaciones, GDR............ 237,000
44,296 Perez Compac, ADR+................. 559,458
14,000 Telefonica de Argentina, ADR....... 348,250
29,950 Y.P.F Sociedad Anonima, ADR........ 685,106
-----------
2,155,801
-----------
BRAZIL -- 6.6%
30,600 CEMIG Companhia, New, ADR.......... 910,350
100,000 Cia Acos Especiais Itab, ADR....... 437,500
42,500 Electrobras, ADR+.................. 595,000
17,000 Telebras, ADR...................... 1,334,500
203,138 Telecomunicacoes de Sao Paulo SA
NPV+............................. 34,418
320,000,000 White Martins ord.................. 454,434
-----------
3,766,202
-----------
CHILE -- 7.3%
75,000 Antofagasta Holdings ord........... 422,631
19,300 Banco de Edwards, ADR.............. 357,050
3,800 Chilectra SA, ADR.................. 204,548
7,000 Cia de Telecomunicaciones de Chile
SA, ADR.......................... 676,375
25,100 Enersis SA, ADR.................... 809,475
20,000 Madeco SA, ADR..................... 462,500
26,600 Santa Isabel SA, ADR............... 681,625
8,900 Sociedad Quimica Minera de Chile,
ADR.............................. 497,288
-----------
4,111,492
-----------
COLOMBIA -- 0.7%
22,100 Banco Industrial Colombiano, ADR... 411,613
-----------
GREECE -- 2.0%
11,000 Ergo Bank.......................... 634,098
15,000 Hellenic Bottling Company SA....... 510,098
-----------
1,144,196
-----------
HONG KONG -- 5.1%
72,000 China Light & Power................ 335,187
254,000 Guangdong Investment Ltd. ......... 179,012
80,000 Guoco Group........................ 391,051
41,000 Henderson Land Development
Company Ltd. .................... 351,254
112,000 New World Development Company...... 588,025
2,200,000 Shanghai Petrochemical Company
Ltd. ............................ 583,215
2,000,000 Yizheng Chemical Fibre............. 486,228
-----------
2,913,972
-----------
INDIA -- 5.2%
18,750 Hindalco, GDR...................... 356,250
43,000 Indian Hotels Company Ltd., GDS.... 983,840
60,000 Larsen & Toubro Ltd., GDS++........ 865,800
20,000 Ranbaxy Laboratories Ltd., GDS..... 364,600
35,000 Reliance Industries Ltd., GDS...... 372,050
-----------
2,942,540
-----------
INDONESIA -- 4.4%
45,000 Hanjaya Mandala Sampoerna, Alien
Shares........................... 437,796
218,000 Indofood Sukses Makmur, Alien
Shares........................... 464,529
290,487 PT Bank International Indonesia,
Alien Shares..................... 425,164
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
INDONESIA -- (CONTINUED)
20,000 PT Indonesian Satellite, ADR, "B"
Class............................ $ 660,000
181,000 Semen Gresik, Alien Shares......... 537,624
-----------
2,525,113
-----------
MALAYSIA -- 13.9%
675,000 Bandar Raya Developments Berhad.... 1,179,580
270,000 Development & Commercial Bank
Holdings Corporation............. 926,428
115,000 Konsortium Perkapalan Berhad+...... 747,885
140,000 Malayan Banking Berhad............. 1,390,839
137,000 Resorts World Berhad............... 776,173
161,000 Telekom Malaysia................... 1,419,606
155,000 Tenaga Nasional Berhad............. 544,207
120,000 United Engineers (Malaysia)
Berhad........................... 928,822
-----------
7,913,540
-----------
MEXICO -- 8.3%
96,803 Alfa SA de CV...................... 428,768
40,000 Carso Global Telecom, ADR.......... 230,000
106,000 Cemex SA NPV....................... 395,816
460,000 Cifra SA de CV, Class B+........... 667,000
13,800 Consorcio Ara SA , ADR++........... 293,250
26,000 Empresas ICA Sociedad Controladora
SA de CV+........................ 396,500
40,000 Grupo Carso SA de CV, ADR.......... 367,600
110,000 Grupo Corvi SA..................... 123,225
102,000 Grupo Modelo SA de CV, Class C..... 526,748
40,000 Invercorporacion SA+............... 5,350
1,000,000 Seguros Commercial American, Class
B+............................... 309,852
30,000 Telefonos de Mexico SA, ADR........ 963,750
-----------
4,707,859
-----------
PERU -- 1.5%
34,000 Banco Wiese, ADR................... 216,750
10,000 CPT Telefonica del Peru, ADR....... 228,750
172,000 CPT Telefonica del Peru, Class B... 388,542
-----------
834,042
-----------
PHILIPPINES -- 4.5%
575,000 Ayala Corporation, Class B......... 657,519
65,000 Manila Electric Company, Class B... 480,656
45,000 Philippines National Bank.......... 741,852
200,000 San Miguel Corporation, Class B.... 655,612
-----------
2,535,639
-----------
PORTUGAL -- 0.7%
15,000 Portugal Telecommunications, ADR... 386,250
-----------
SOUTH AFRICA -- 9.1%
8,000 Anglo-American Industrial
Corporation SA................... 282,156
13,000 Barlow Ltd. ....................... 126,088
40,000 Barlow Ltd., ADR................... 391,000
30,000 De Beers Consolidated Mines
Ltd.+............................ 932,437
160,000 Gencor Ltd. ....................... 571,366
50,000 Malbak Ltd. NPV.................... 209,413
25,000 Nedcor Ltd., GDR................... 362,500
70,000 Rembrandt Group.................... 632,646
60,000 Sasol NPV.......................... 707,594
50,000 Sentrachem Ltd. ................... 145,455
15,000 Sentrachem Ltd., GDR+.............. 183,750
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
12
<PAGE> 15
NATIONS FUND
Nations Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
<C> <S> <C>
------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
SOUTH AFRICA -- (CONTINUED)
350,000 South Africa Iron & Steel
Industrial Corporation........... $ 230,684
15,000 South African Breweries............ 400,088
-----------
5,175,177
-----------
SOUTH KOREA -- 4.7%
85,000 Daewoo Heavy Industries............ 638,015
40,024 Dong Ah Construction Industries,
EDR.............................. 530,448
3,524 Dong Ah Construction Industries,
EDR+............................. 43,169
20,000 Korea Electric Power Corporation,
ADR.............................. 377,500
28,190 Korea Exchange Bank................ 324,560
16,805 Samsung Corporation, Non-Voting
Shares, GDS+..................... 418,108
1,150 Samsung Electronics Ltd. .......... 90,218
36 Samsung Electronics Ltd., ADR...... 1,602
120 Samsung Electronics Ltd., GDR++.... 5,986
3,195 Samsung Electronics Ltd., GDS++.... 75,082
346 Samsung Electronics Ltd.,
Refunding 01/01/97............... 26,055
10,000 The Daegu Bank..................... 134,383
-----------
2,665,126
-----------
TAIWAN -- 1.1%
33,000 Evergreen Marine Corporation,
GDR.............................. 615,450
-----------
THAILAND -- 3.9%
67,000 PTT Exploration and Production
Public Company Ltd., Alien
Shares........................... 990,603
48,000 Thai Farmers Bank Public Company
Ltd., Alien Shares............... 505,839
100,000 Total Access Communications
(CLOB)........................... 740,000
-----------
2,236,442
-----------
TOTAL COMMON STOCKS
(Cost $47,162,645)............... 47,040,454
==========
PREFERRED STOCKS -- 7.6%
BRAZIL -- 6.8%
89,437,263 Banco Bradesco..................... 762,063
1,500,000 Cia Cervejaria Brahma.............. 932,878
24,100 Compania Vale do Rio Doce, ADR..... 479,108
8,000,000 Petroleo Brasileiro................ 940,130
4,000,000 Telecomunicacoes de Sao Paulo SA
NPV+............................. 767,838
-----------
3,882,017
-----------
SOUTH KOREA -- 0.8%
37,000 Daewoo Securities Company+......... 433,608
-----------
TOTAL PREFERRED STOCKS
(Cost $3,816,492)................ 4,315,625
===========
INVESTMENT FUNDS -- 5.5%
SOUTH KOREA -- 0.3%
50 Korea Europe Fund, IDR............. 162,500
-----------
TAIWAN -- 5.2%
160 Formosa Fund, IDR.................. 1,416,000
125,000 Taiwan Index Fund.................. 1,525,000
-----------
2,941,000
-----------
TOTAL INVESTMENT FUNDS
(Cost $2,648,625)................ 3,103,500
===========
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
<C> <S> <C>
----------
CONVERTIBLE BONDS -- 1.1%
TAIWAN -- 1.1%
USD300,000 Far East Department Stores,
3.000% 07/06/01.................. 316,500
USD190,000 President Enterprise Corporation,
Conv.,
Zero coupon 07/22/01............. 295,925
-----------
TOTAL CONVERTIBLE BONDS
(Cost $599,930)................ 612,425
===========
<CAPTION>
SHARES
<C> <S> <C>
----------
WARRANTS -- 0.0%#
BRAZIL -- 0.0%#
4,990 Cia Cervejaria Brahma, Expire
04/30/03+........................ 269
59,969 Cia Cervejaria Brahma, Preferred
Shares, Expire 04/30/03+......... 4,112
-----------
4,381
-----------
THAILAND -- 0.0%#
6,000 Thai Farmers Bank Public Company
Ltd., Expire 09/15/02+........... 16,043
-----------
TOTAL WARRANTS
(Cost $21,112)................... 20,424
===========
TOTAL INVESTMENTS
(Cost $54,248,804*)................... 97.0% 55,092,428
OTHER ASSETS AND
LIABILITIES (NET)..................... 3.0 1,717,458
----- -----------
NET ASSETS.............................. 100.0% $56,809,886
===== ==========
</TABLE>
- ---------------
* 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%.
ABBREVIATIONS:
ADR American Depositary Receipt
CLOB Custody License Outside Border
Conv. Convertible
EDR European Depositary Receipt
GDR Global Depositary Receipt
GDS Global Depositary Share
IDR International Depositary Receipt
ord Ordinary Shares
USD United States Dollar
SEE NOTES TO FINANCIAL STATEMENTS.
13
<PAGE> 16
NATIONS FUND
Nations Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1996 (UNAUDITED)
AT SEPTEMBER 30, 1996 SECTOR DIVERSIFICATION WAS AS FOLLOWS:
<TABLE>
<CAPTION>
% OF NET VALUE
SECTOR DIVERSIFICATION ASSETS (NOTE 1)
<S> <C> <C>
- --------------------------------------------------------------------------------------------------------
COMMON STOCKS:
Finance....................................................................... 23.0% $13,063,566
Services...................................................................... 19.7 11,200,789
Capital Equipment............................................................. 15.2 8,604,725
Energy........................................................................ 12.9 7,334,017
Materials..................................................................... 12.0 6,837,357
-------- -----------
TOTAL COMMON STOCKS........................................................... 82.8 47,040,454
PREFERRED STOCKS.............................................................. 7.6 4,315,625
INVESTMENT FUNDS.............................................................. 5.5 3,103,500
CONVERTIBLE BONDS............................................................. 1.1 612,425
WARRANTS...................................................................... 0.0# 20,424
-------- -----------
TOTAL INVESTMENTS............................................................. 97.0 55,092,428
OTHER ASSETS AND LIABILITIES (NET)............................................ 3.0 1,717,458
-------- -----------
NET ASSETS.................................................................... 100.0% $56,809,886
======== ===========
</TABLE>
- ---------------
# Amount represents less than 0.1%.
SEE NOTES TO FINANCIAL STATEMENTS.
14
<PAGE> 17
NATIONS FUND
Nations Global Government Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
<S> <C> <C> <C>
- ------------------------------------------------------------
FOREIGN BONDS AND NOTES -- 84.5%
AUSTRALIA -- 6.4%
AUD 2,000,000 Commonwealth of Australia,
6.750% 11/15/06.......... $ 1,467,720
AUD 1,600,000 Government of Australia,
7.000% 08/15/98.......... 1,270,187
------------
2,737,907
------------
AUSTRIA -- 1.7%
DEM 1,000,000 Government of Austria,
8.000% 06/17/02.......... 732,203
------------
BELGIUM -- 3.9%
USD 950,000 Kingdom of Belgium,
7.000% 07/07/99.......... 963,211
USD 750,000 Kingdom of Belgium,
5.500% 11/05/03.......... 689,730
------------
1,652,941
------------
CANADA -- 11.1%
CAD 2,280,000 Government of Canada,
8.500% 03/01/00.......... 1,810,876
USD 1,800,000 Province of Alberta,
6.250% 10/19/00.......... 1,781,100
CAD 1,550,000 Province of Ontario,
7.750% 12/08/03.......... 1,175,829
------------
4,767,805
------------
DENMARK -- 8.0%
DKK 7,500,000 Kingdom of Denmark,
6.000% 12/10/99.......... 1,320,600
DKK 12,000,000 Kingdom of Denmark,
7.000% 12/15/04.......... 2,092,888
------------
3,413,488
------------
FRANCE -- 4.7%
ECU 1,000,000 Obligations Assimilables du
Tresor (France),
6.750% 04/25/02.......... 1,308,771
ITL 1,000,000,000 S.N.C.F.,
11.50% 10/18/99.......... 718,493
------------
2,027,264
------------
GERMANY -- 12.4%
DEM 1,500,000 DSL Finance NV,
5.000% 01/23/01.......... 985,035
DEM 3,050,000 Federal Republic of
Germany,
5.125% 11/21/00.......... 2,026,675
DEM 3,430,000 Federal Republic of
Germany,
6.500% 10/14/05.......... 2,311,751
------------
5,323,461
------------
GREAT BRITAIN -- 12.2%
GBP 600,000 British Aerospace plc,
11.875% 12/29/08......... 1,174,586
USD 1,950,000 Glaxo Wellcome plc,
6.750% 05/31/00.......... 1,965,503
GBP 1,300,000 United Kingdom Treasury,
8.000% 12/07/00.......... 2,111,199
------------
5,251,288
------------
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
<S> <C> <C> <C>
- ------------------------------------------------------------
FOREIGN BONDS AND NOTES -- (CONTINUED)
IRELAND -- 3.0%
IRP 800,000 Government of Ireland,
6.500% 10/18/01.......... $ 1,293,946
------------
ITALY -- 7.2%
ITL 2,100,000,000 Republic of Italy,
9.500% 12/01/99.......... 1,440,394
JPY 175,000,000 Republic of Italy, Global
Bond,
3.500% 06/20/01.......... 1,661,889
------------
3,102,283
------------
NETHERLANDS -- 2.6%
NLG 1,800,000 Government of the
Netherlands,
6.500% 01/15/99.......... 1,111,273
------------
SPAIN -- 2.4%
PTS 55,000,000 Government of Spain,
12.250% 03/25/00......... 493,151
PTS 65,000,000 Government of Spain,
8.000% 05/30/04.......... 512,897
------------
1,006,048
------------
SUPRANATIONAL -- 4.1%
JPY 125,000,000 European Investment Bank,
4.500% 10/08/97.......... 1,163,965
GBP 380,000 European Investment Bank,
8.000% 06/10/03.......... 610,874
------------
1,774,839
------------
SWEDEN -- 4.8%
JPY 150,000,000 Government of Sweden,
4.625% 02/04/98.......... 1,413,556
SEK 4,800,000 Government of Sweden,
6.000% 02/09/05.......... 663,302
------------
2,076,858
------------
TOTAL FOREIGN BONDS AND
NOTES
(Cost $35,819,050)....... 36,271,604
==========
U.S. TREASURY OBLIGATIONS -- 8.2%
USD 2,100,000 U.S. Treasury Note,
6.250% 07/31/98.......... 2,104,594
USD 1,500,000 U.S. Treasury Note,
5.250% 01/31/01.......... 1,438,365
------------
TOTAL U.S. TREASURY
OBLIGATIONS
(Cost $3,578,895)........ 3,542,959
===========
TOTAL INVESTMENTS
(Cost $39,397,945*).................... 92.7% 39,814,563
OTHER ASSETS AND
LIABILITIES (NET)...................... 7.3 3,157,637
----- -----------
NET ASSETS............................... 100.0% $42,972,200
===== ===========
</TABLE>
- ---------------
* Aggregate cost for Federal tax purposes.
SEE NOTES TO FINANCIAL STATEMENTS
15
<PAGE> 18
NATIONS FUND
Nations Global Government Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF FORWARD FOREIGN EXCHANGE CONTRACTS SEPTEMBER 30, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
CONTRACT TO SELL
--------------------------------------------------- IN NET UNREALIZED
MATURITY LOCAL VALUE IN EXCHANGE APPRECIATION
DATE CURRENCY U.S. $ FOR U.S. $ OF CONTRACT
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------
10/09/96 4,000,000 DEM...................... $2,620,566 $2,643,580 $ 23,014
10/09/96 7,500,000 DKK...................... 1,280,474 1,282,490 2,016
10/09/96 1,300,000 NLG...................... 759,229 766,057 6,828
-----------
Net Unrealized Appreciation of Forward Foreign Exchange Contracts................. $ 31,858
===========
</TABLE>
ABBREVIATIONS OF CURRENCY
THAT ISSUE IS HELD IN:
AUD Australian Dollar
CAD Canadian Dollar
DEM German Deutschmark
DKK Danish Krona
ECU European Currency Unit
GBP Great Britain Pound
IRP Irish Pound
ITL Italian Lira
JPY Japanese Yen
NLG Netherlands Guilder
PTS Spanish Peseta
SEK Swedish Krona
USD United States Dollar
SEE NOTES TO FINANCIAL STATEMENTS.
16
<PAGE> 19
NATIONS FUND
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
NATIONS
NATIONS NATIONS NATIONS GLOBAL
INTERNATIONAL PACIFIC EMERGING GOVERNMENT
EQUITY GROWTH MARKETS INCOME
FUND FUND FUND FUND
<S> <C> <C> <C> <C>
----------------------------------------------------
ASSETS:
Investments, at value (Note 1) See accompanying schedules......... $ 963,578,568 $108,029,631 $55,092,428 $39,814,563
Cash.............................................................. 18,498,175 5,750,282 1,802,033 1,432,159
Net unrealized appreciation of forward foreign exchange
contracts....................................................... 4,087,108 -- -- 31,858
Dividends receivable.............................................. 2,874,467 123,839 56,862 --
Interest receivable............................................... 187,870 48,196 9,429 1,313,532
Receivable for Fund shares sold................................... 4,530,846 483,191 123,764 458,118
Receivable for investment securities sold......................... 12,691,964 1,089,854 -- --
Unamortized organization costs (Note 6)........................... 7,920 117,402 109,428 129,733
Prepaid expenses and other assets................................. 8,607 -- -- 5,014
------------ ----------- ----------- -----------
Total Assets.................................................... 1,006,465,525 115,642,395 57,193,944 43,184,977
------------ ----------- ----------- -----------
LIABILITIES:
Net unrealized depreciation of forward foreign exchange
contracts....................................................... -- 1,313 -- --
Payable for Fund shares redeemed.................................. 2,530,682 66,183 1,457 --
Payable for investment securities purchased....................... 4,007,435 2,321,398 293,250 --
Dividends payable................................................. -- -- -- 164,413
Investment advisory fee payable (Note 2).......................... 572,456 80,641 50,982 24,433
Administration fee payable (Note 2)............................... 80,445 8,960 4,635 3,490
Shareholder servicing and distribution fees payable (Note 3)...... 36,336 3,373 1,413 3,454
Transfer agent fees payable (Note 2).............................. 64,218 8,510 5,115 4,214
Custodian fees payable (Note 2)................................... 32,015 14,616 5,561 1,317
Accrued Directors' fees and expenses (Note 2)..................... 23,158 19,970 10,281 7,949
Accrued expenses and other payables............................... 112,492 32,799 11,364 3,507
------------ ----------- ----------- -----------
Total Liabilities............................................... 7,459,237 2,557,763 384,058 212,777
------------ ----------- ----------- -----------
NET ASSETS........................................................ $ 999,006,288 $113,084,632 $56,809,886 $42,972,200
============== =========== =========== ===========
Investments, at cost.............................................. $ 870,305,886 $102,569,161 $54,248,804 $39,397,945
============== =========== =========== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
17
<PAGE> 20
NATIONS FUND
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED) SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
NATIONS
NATIONS NATIONS NATIONS GLOBAL
INTERNATIONAL PACIFIC EMERGING GOVERNMENT
EQUITY GROWTH MARKETS INCOME
FUND FUND FUND FUND
<S> <C> <C> <C> <C>
---------------------------------------------------
NET ASSETS CONSIST OF:
Undistributed net investment income/(distributions in excess of
net investment income)........................................... $ 1,128,730 $ 99,056 $ (179,195) $ (108,342)
Accumulated net realized gain/(loss) on investments sold, forward
foreign
exchange contracts, foreign currencies and net other assets...... 28,382,676 (2,925,911) 409,000 721,347
Net unrealized appreciation of investments, forward foreign
exchange contracts, foreign currencies and net other assets...... 97,117,149 5,440,192 840,149 41,032
Paid-in capital.................................................... 872,377,733 110,471,295 55,739,932 41,918,163
------------ ----------- ----------- -----------
$999,006,288 $113,084,632 $56,809,886 $42,972,200
============ =========== =========== ===========
NET ASSETS:
Primary A Shares................................................... $944,663,451 $107,859,808 $54,682,947 $26,917,648
============ =========== =========== ===========
Primary B Shares................................................... $ 3,114,917 $ 229,655 $ 28,172 $ 57,155
============ =========== =========== ===========
Investor A Shares.................................................. $ 11,219,808 $ 2,490,309 $ 639,184 $15,801,204
============ =========== =========== ===========
Investor C Shares.................................................. $ 881,179 $ 72,068 $ 140,007 $ 9,339
============ =========== =========== ===========
Investor N Shares.................................................. $ 39,126,933 $ 2,432,792 $ 1,319,576 $ 186,854
============ =========== =========== ===========
SHARES OUTSTANDING:
Primary A Shares................................................... 69,424,259 10,533,252 5,277,310 2,603,018
============ =========== =========== ===========
Primary B Shares................................................... 229,158 22,445 2,721 5,527
============ =========== =========== ===========
Investor A Shares.................................................. 831,933 243,791 61,787 1,528,070
============ =========== =========== ===========
Investor C Shares.................................................. 66,691 7,083 13,585 903
============ =========== =========== ===========
Investor N Shares.................................................. 2,933,428 239,809 128,337 18,070
============ =========== =========== ===========
PRIMARY A SHARES:
Net asset value, offering and redemption price per share........... $13.61 $10.24 $10.36 $10.34
====== ===== ===== ======
PRIMARY B SHARES:
Net asset value, offering and redemption price per share........... $13.59 $10.23 $10.35 $10.34
====== ===== ===== ======
INVESTOR A SHARES:
Net asset value, offering and redemption price per share........... $13.49 $10.21 $10.34 $10.34
====== ===== ===== ======
INVESTOR C SHARES:
Net asset value and offering price per share*...................... $13.21 $10.17 $10.31 $10.34
====== ===== ===== ======
INVESTOR N SHARES:
Net asset value, offering and redemption price per share........... $13.34 $10.14 $10.28 $10.34
====== ===== ===== ======
</TABLE>
- ---------------
* Redemption price per share is equal to Net Asset Value less any applicable
contingent deferred sales charge.
SEE NOTES TO FINANCIAL STATEMENTS.
18
<PAGE> 21
NATIONS FUND
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
NATIONS
NATIONS NATIONS NATIONS GLOBAL
INTERNATIONAL PACIFIC EMERGING GOVERNMENT
EQUITY GROWTH MARKETS INCOME
FUND FUND FUND FUND
<S> <C> <C> <C> <C>
------------------------------------------------
INVESTMENT INCOME:
Dividends (Net of foreign withholding taxes of $1,357,704, $112,185,
$28,551 and $0, respectively)........................................ $10,326,712 $ 966,364 $ 588,784 $ --
Interest (Net of foreign withholding taxes of $1,149, $0, $0 and
$16,217, respectively)............................................... 662,814 107,215 59,411 1,339,948
------------ ----------- --------- ----------
Total investment income............................................ 10,989,526 1,073,579 648,195 1,339,948
------------ ----------- --------- ----------
EXPENSES:
Investment advisory fee (Note 2)....................................... 4,296,215 485,405 299,800 144,212
Administration fee (Note 2)............................................ 477,358 53,934 27,255 20,601
Transfer agent fees (Note 2)........................................... 283,178 34,898 19,343 15,451
Custodian fees (Note 2)................................................ 242,506 74,254 33,873 5,971
Shareholder reports expense............................................ 86,562 28,327 27,152 12,724
Legal and audit fees................................................... 91,522 23,656 30,589 23,995
Registration and filing fees........................................... 98,179 65,376 10,336 9,606
Directors' fees and expenses (Note 2).................................. 10,752 20,774 11,295 8,859
Amortization of organization costs (Note 6)............................ 10,317 15,653 14,590 17,298
Other.................................................................. 14,093 1,053 12,354 14,799
------------ ----------- --------- ----------
Subtotal........................................................... 5,610,682 803,330 486,587 273,516
Shareholder servicing and distribution fees (Note 3):
Primary B Shares..................................................... 2,099 272 44 159
Investor A Shares.................................................... 11,679 2,212 662 18,860
Investor C Shares.................................................... 1,724 184 136 23
Investor N Shares.................................................... 199,435 11,944 6,626 938
Fees waived by investment adviser (Note 2)............................. (151,552) -- -- --
------------ ----------- --------- ----------
Total expenses..................................................... 5,674,067 817,942 494,055 293,496
------------ ----------- --------- ----------
NET INVESTMENT INCOME.................................................. 5,315,459 255,637 154,140 1,046,452
------------ ----------- --------- ----------
NET REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS
(NOTES 1 AND 4):
Net realized gain/(loss) from:
Security transactions................................................ 18,108,614 (2,482,759) 585,111 205,851
Forward foreign exchange contracts................................... 2,995,536 (63,310) (686) 279,634
Foreign currencies................................................... 642,057 9,174 (16,037) (31,297)
------------ ----------- --------- ----------
Net realized gain/(loss) on investments during the period.............. 21,746,207 (2,536,895) 568,388 454,188
------------ ----------- --------- ----------
Change in unrealized appreciation/(depreciation) of:
Securities........................................................... (16,339,432) 2,409,993 (464,840) 676,266
Forward foreign exchange contracts................................... 2,153,125 (3,013) 70 (27,503)
Currencies and other net assets...................................... (217,312) (16,714) (3,141) (7,592)
------------ ----------- --------- ----------
Net unrealized appreciation/(depreciation) of investments during the
period............................................................... (14,403,619) 2,390,266 (467,911) 641,171
------------ ----------- --------- ---------
Net realized and unrealized gain/(loss) on investments................. 7,342,588 (146,629) 100,477 1,095,359
------------ ----------- --------- ---------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS................... $ 12,658,047 $ 109,008 $ 254,617 $2,141,811
------------ ----------- --------- ----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
19
<PAGE> 22
NATIONS FUND
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
NATIONS
NATIONS NATIONS NATIONS GLOBAL
INTERNATIONAL PACIFIC EMERGING GOVERNMENT
EQUITY GROWTH MARKETS INCOME
FUND FUND FUND FUND
<S> <C> <C> <C> <C>
--------------------------------------------------------
Net investment income....................................... $ 5,315,459 $ 255,637 $ 154,140 $ 1,046,452
Net realized gain/(loss) on investments..................... 21,746,207 (2,536,895) 568,388 454,188
Change in unrealized appreciation/(depreciation) of
investments............................................... (14,403,619) 2,390,266 (467,911) 641,171
------------ ------------ ----------- -----------
Net increase in net assets resulting from operations........ 12,658,047 109,008 254,617 2,141,811
Distributions to shareholders from net investment income:
Primary A Shares.......................................... (5,091,690) (154,626) (238,209) (666,955)
Primary B Shares.......................................... -- -- -- (1,495)
Investor A Shares......................................... (45,056) (1,955) (1,669) (373,872)
Investor C Shares......................................... (2,547) -- -- (212)
Investor N Shares......................................... (125,789) -- -- (3,917)
Net increase/(decrease) in net assets from Fund share
transactions:
Primary A Shares.......................................... 87,873,780 12,696,637 7,106,599 1,478,315
Primary B Shares.......................................... 3,094,802 229,625 28,077 54,657
Investor A Shares......................................... 3,462,790 1,106,625 159,961 502,437
Investor C Shares......................................... 225,230 12,122 115,114 212
Investor N Shares......................................... (1,495,236) 117,711 115,885 (10,628)
------------ ------------ ----------- -----------
Net increase in net assets.................................. 100,554,331 14,115,147 7,540,375 3,120,353
NET ASSETS:
Beginning of period......................................... 898,451,957 98,969,485 49,269,511 39,851,847
------------ ------------ ----------- -----------
End of period............................................... $999,006,288 $113,084,632 $56,809,886 $42,972,200
============ ============ =========== ===========
Undistributed net investment income/(distributions in excess
of net investment income)................................. $ 1,128,730 $ 99,056 $ (179,195) $ (108,342)
============ ============ =========== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
20
<PAGE> 23
NATIONS FUND
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE PERIOD ENDED MARCH 31, 1996
<TABLE>
<CAPTION>
NATIONS
NATIONS NATIONS NATIONS GLOBAL
INTERNATIONAL PACIFIC EMERGING GOVERNMENT
EQUITY GROWTH MARKETS INCOME
FUND(A) FUND(B) FUND(B) FUND(B)
<S> <C> <C> <C> <C>
-------------------------------------------------------
Net investment income/(loss)................................. $ 3,626,554 $ (100,618) $ (71,055) $ 969,470
Net realized gain/(loss) on investments...................... 32,418,643 (445,524) (197,613) 221,004
Change in unrealized appreciation/(depreciation) of
investments................................................ 72,008,937 3,049,926 1,308,060 (200,139)
------------ ----------- ----------- -----------
Net increase in net assets resulting from operations......... 108,054,134 2,503,784 1,039,392 990,335
Distributions to shareholders from net investment income:
Primary A Shares........................................... (3,605,055) -- -- (797,500)
Investor A Shares.......................................... (21,498) -- -- (119,144)
Investor C Shares.......................................... -- -- -- (267)
Investor N Shares.......................................... -- -- -- (3,189)
Distributions to shareholders in excess of net investment
income:
Primary A Shares........................................... (2,391,207) (108,132) (3,687) (42,578)
Investor A Shares.......................................... (20,996) (1,632) -- (6,554)
Investor C Shares.......................................... (1,140) -- -- (17)
Investor N Shares.......................................... (85,934) (1,443) -- (221)
Distributions to shareholders from net realized gain on
investments:
Primary A Shares........................................... (1,248,540) -- -- (81,861)
Investor A Shares.......................................... (11,031) -- -- (89)
Investor C Shares.......................................... (1,122) -- -- (33)
Investor N Shares.......................................... (71,408) -- -- (586)
Net increase in net assets from Fund share transactions:
Primary A Shares........................................... 182,162,851 92,975,768 46,582,308 24,647,663
Investor A Shares.......................................... 1,946,226 1,318,061 454,932 15,047,874
Investor C Shares.......................................... 78,368 50,206 14,264 327
Investor N Shares.......................................... 3,984,676 2,198,873 1,148,302 183,687
------------ ----------- ----------- -----------
Net increase in net assets................................... 288,768,324 98,935,485 49,235,511 39,817,847
NET ASSETS:
Beginning of period.......................................... 609,683,633 34,000 34,000 34,000
------------ ----------- ----------- -----------
End of period................................................ $898,451,957 $98,969,485 $49,269,511 $39,851,847
============ =========== =========== ===========
Undistributed net investment income/(distributions in excess
of net investment income).................................. $ 1,078,353 $ -- $ (93,457) $ (108,343)
============ =========== =========== ===========
</TABLE>
- ---------------
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
May 31. The numbers reflected are for the period June 1, 1995 through March
31, 1996.
(b) Nations Emerging Markets Fund, Nations Pacific Growth Fund and Nations
Global Government Income Fund commenced operations on June 30, 1995.
SEE NOTES TO FINANCIAL STATEMENTS.
21
<PAGE> 24
NATIONS FUND
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY
<TABLE>
<CAPTION>
NATIONS INTERNATIONAL EQUITY FUND NATIONS PACIFIC GROWTH FUND
PERIOD ENDED PERIOD ENDED
SEPTEMBER 30, 1996(a) PERIOD ENDED SEPTEMBER 30, 1996(a) PERIOD ENDED
(UNAUDITED) MARCH 31, 1996(b) (UNAUDITED) MARCH 31, 1996(c)
----------------------- ---------------------- ---------------------- --------------------
SHARES DOLLARS SHARES DOLLARS SHARES DOLLARS SHARES DOLLARS
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PRIMARY A
SHARES:
Sold....... 16,198,836 $ 219,543,667 21,779,745 $277,149,224 3,717,706 $ 38,414,350 9,508,684 $95,045,750
Issued as
reinvestment
of
dividends... 122,543 1,671,486 117,187 1,548,026 4,763 49,061 630 6,096
Redeemed... (9,832,091) (133,341,373) (7,709,286) (96,534,399) (2,485,714) (25,766,774) (213,667) (2,076,078)
---------- ------------ ---------- ------------ --------- ----------- --------- -----------
Net
increase... 6,489,288 $ 87,873,780 14,187,646 $182,162,851 1,236,755 $ 12,696,637 9,295,647 $92,975,768
========== ============ ========== ============ ========= =========== ========= ===========
PRIMARY B
SHARES:
Sold....... 230,266 $ 3,109,588 27,869 $ 285,383
Issued as
reinvestment
of
dividends... -- -- -- --
Redeemed... (1,108) (14,786) (5,424) (55,758)
---------- ------------ --------- -----------
Net
increase... 229,158 $ 3,094,802 22,445 $ 229,625
========= ============= ========= ============
INVESTOR A
SHARES:
Sold....... 382,452 $ 5,084,447 1,204,885 $ 14,928,700 374,017 $ 3,806,577 145,535 $ 1,437,200
Issued as
reinvestment
of
dividends... 3,037 41,091 3,747 48,496 -- -- 168 1,629
Redeemed... (124,278) (1,662,748) (1,055,939) (13,030,970) (264,708) (2,699,952) (12,071) (120,768)
---------- ------------ ---------- ------------ --------- ----------- --------- -----------
Net
increase... 261,211 $ 3,462,790 152,693 $ 1,946,226 109,309 $ 1,106,625 133,632 $ 1,318,061
========== ============ ========== ============ ========= =========== ========= ===========
INVESTOR C
SHARES:
Sold....... 20,476 $ 270,674 9,348 $ 114,146 1,590 $ 16,157 5,052 $ 50,206
Issued as
reinvestment
of
dividends... 178 2,360 167 2,118 -- -- -- --
Redeemed... (3,627) (47,804) (3,089) (37,896) (409) (4,035) -- --
---------- ------------ ---------- ------------ --------- ----------- --------- -----------
Net
increase... 17,027 $ 225,230 6,426 $ 78,368 1,181 $ 12,122 5,052 $ 50,206
========== ============ ========== ============ ========= =========== ========= ===========
INVESTOR N
SHARES:
Sold....... 77,901 $ 1,033,734 719,771 $ 8,739,740 37,467 $ 383,300 232,191 $ 2,245,592
Issued as
reinvestment
of
dividends... 9,107 122,131 11,981 152,998 -- -- 139 1,346
Redeemed... (200,167) (2,651,101) (397,985) (4,908,062) (25,921) (265,589) (4,917) (48,065)
---------- ------------ ---------- ------------ --------- ----------- --------- -----------
Net
increase/
decrease).. (113,159) $ (1,495,236) 333,767 $ 3,984,676 11,546 $ 117,711 227,413 $ 2,198,873
========== ============ ========== ============ ========= =========== ========= ===========
</TABLE>
- ---------------
(a) Nations International Equity Fund's and Nations Pacific Growth Fund's
Primary B Shares commenced operations on June 28, 1996.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
May 31.
(c) Nations Pacific Growth Fund's Primary A Shares, Investor A Shares, Investor
C Shares and Investor N Shares commenced operations on June 30, 1995.
SEE NOTES TO FINANCIAL STATEMENTS.
22
<PAGE> 25
NATIONS FUND
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
NATIONS EMERGING MARKETS FUND NATIONS GLOBAL GOVERNMENT INCOME FUND
PERIOD ENDED PERIOD ENDED
SEPTEMBER 30, 1996(a) PERIOD ENDED SEPTEMBER 30, 1996(a) PERIOD ENDED
(UNAUDITED) MARCH 31, 1996(b) (UNAUDITED) MARCH 31, 1996(b)
---------------------- -------------------- ------------------- --------------------
SHARES DOLLARS SHARES DOLLARS SHARES DOLLARS SHARES DOLLARS
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold............. 1,791,117 $ 19,035,746 4,725,947 $47,770,341 212,247 $ 2,164,912 2,470,544 $24,792,601
Issued as
reinvestment
of dividends... 10,258 109,662 16 155 53,767 547,630 17,845 180,058
Redeemed......... (1,124,799) (12,038,809) (126,079) (1,188,188) (120,530) (1,234,227) (31,705) (324,996)
--------- ----------- --------- -----------
Net increase..... 676,576 $ 7,106,599 4,599,884 $46,582,308 145,484 $ 1,478,315 2,456,684 $24,647,663
========= ============ ========= =========== ======= =========== ========= ===========
PRIMARY B SHARES:
Sold............. 5,139 $ 54,020 12,919 $ 130,884
Issued as
reinvestment
of dividends... -- -- 68 699
Redeemed......... (2,418) (25,943) (7,460) (76,926)
--------- -----------
Net increase..... 2,721 $ 28,077 5,527 $ 54,657
========= =========== ======= ==========
INVESTOR A SHARES:
Sold............. 47,894 $ 503,818 46,699 $ 468,391 49,234 $ 504,816 1,478,192 $15,047,626
========= ============ ========= =========== ======= =========== ========= ===========
Issued as
reinvestment
of dividends... 138 1,471 -- -- 348 3,577 94 953
Redeemed......... (32,475) (345,328) (1,319) (13,459) (578) (5,956) (70) (705)
--------- ----------- --------- -----------
Net increase..... 15,557 $ 159,961 45,380 $ 454,932 49,004 $ 502,437 1,478,216 $15,047,874
--------- ----------- --------- -----------
INVESTOR C SHARES:
Sold............. 11,310 $ 115,114 1,425 $ 14,264 -- $ -- 1 $ 10
Issued as
reinvestment
of dividends... -- -- -- -- 21 212 31 317
--------- ----------- --------- -----------
Net increase..... 11,310 $ 115,114 1,425 $ 14,264 21 $ 212 32 $ 327
========= ============ ========= =========== ======= =========== ========= ===========
INVESTOR N SHARES:
Sold............. 25,259 $ 266,819 121,704 $ 1,194,610 591 $ 5,974 18,001 $ 180,857
Issued as
reinvestment
of dividends... -- -- -- -- 332 3,357 392 3,996
Redeemed......... (14,719) (150,934) (4,757) (46,308) (1,982) (19,959) (114) (1,166)
--------- ----------- --------- -----------
Net
increase/
(decrease)....... 10,540 $ 115,885 116,947 $ 1,148,302 (1,059) $ (10,628) 18,279 $ 183,687
========= ============ ========= =========== ======= =========== ========= ============
</TABLE>
- ---------------
(a) Nations Emerging Markets Fund's and Nations Global Government Income Fund's
Primary B Shares commenced operations on June 28, 1996.
(b) Nations Emerging Markets Fund's and Nations Global Government Income Fund's
Primary A Shares, Investor A Shares, Investor C Shares and Investor N Shares
commenced operations on June 30, 1995.
SEE NOTES TO FINANCIAL STATEMENTS.
23
<PAGE> 26
NATIONS FUND
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS DISTRIBUTIONS
VALUE INVESTMENT AND UNREALIZED (DECREASE) IN FROM NET IN EXCESS OF FROM NET
BEGINNING OF INCOME/ GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT NET INVESTMENT REALIZED
PERIOD (LOSS) INVESTMENTS FROM OPERATIONS INCOME INCOME CAPITAL GAINS
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
NATIONS INTERNATIONAL
EQUITY FUND
PRIMARY A SHARES
Six months ended
09/30/1996
(unaudited)#........ $13.50 $ 0.08 $ 0.11 $ 0.19 $(0.08) -- --
Period ended
03/31/1996(a)#...... 11.75 0.07 1.80 1.87 (0.06) $(0.04) $ (0.02)
Year ended
05/31/1995#......... 12.06 0.14 (0.20) (0.06) (0.03) -- (0.12)
Year ended
05/31/1994#......... 10.60 0.09 1.44 1.53 (0.05) -- (0.02)
Year ended
05/31/1993#......... 10.40 0.09 0.21 0.30 (0.08) -- (0.02)
Period ended
05/31/1992*......... 10.00 0.08 0.36 0.44 (0.04) -- --
PRIMARY B SHARES
Period ended
09/30/1996
(unaudited)*#....... $13.65 $ 0.02 $(0.08)(c) $ (0.06) -- -- --
INVESTOR A SHARES
Six months ended
09/30/1996
(unaudited)#........ $13.39 $ 0.06 $ 0.11 $ 0.17 $(0.07) -- --
Period ended
03/31/1996(a)#...... 11.67 0.04 1.78 1.82 (0.04) $(0.04) $ (0.02)
Year ended
05/31/1995#......... 12.00 0.11 (0.20) (0.09) (0.02) -- (0.12)
Year ended
05/31/1994#......... 10.56 0.06 1.44 1.50 (0.04) -- (0.02)
Period ended
05/31/1993*#........ 10.38 0.07 0.21 0.28 (0.08) -- (0.02)
INVESTOR C SHARES
Six months ended
09/30/1996
(unaudited)#........ $13.13 $ 0.04 $ 0.09 $ 0.13 $(0.05) -- --
Period ended
03/31/1996(a)#...... 11.45 (0.03) 1.75 1.72 -- $(0.02) $ (0.02)
Year ended
05/31/1995#......... 11.86 0.02 (0.21) (0.19) -- -- (0.12)
Year ended
05/31/1994#......... 10.49 (0.03) 1.43 1.40 (0.01) -- (0.02)
Period ended
05/31/1993*#........ 10.10 0.00*** 0.48 0.48 (0.07) -- (0.02)
INVESTOR N SHARES
Six months ended
09/30/1996
(unaudited)#........ $13.27 $ 0.01 $ 0.10 $ 0.11 $(0.04) -- --
Period ended
03/31/1996(a)#...... 11.56 (0.02) 1.78 1.76 -- $(0.03) $ (0.02)
Year ended
05/31/1995#......... 11.96 0.05 (0.22) (0.17) (0.01) -- (0.12)
Period ended
05/31/1994*#........ 10.51 (0.00)*** 1.51 1.51 (0.04) -- (0.02)
NATIONS PACIFIC GROWTH FUND
PRIMARY A SHARES
Six months ended
09/30/1996
(unaudited)......... $10.24 $ 0.03 $(0.01) $ 0.02 $(0.02) -- --
Period ended
03/31/1996**#....... 10.00 (0.02) 0.29 0.27 -- $(0.03) --
PRIMARY B SHARES
Period ended
09/30/1996
(unaudited)**....... $10.34 $ 0.00*** $(0.11) $ (0.11) -- -- --
INVESTOR A SHARES
Six months ended
09/30/1996
(unaudited)......... $10.23 $ 0.02 $(0.03) $ (0.01) $(0.01) -- --
Period ended
03/31/1996**#....... 10.00 (0.04) 0.29 0.25 -- $(0.02) --
INVESTOR C SHARES
Six months ended
09/30/1996
(unaudited)......... $10.20 $ 0.00*** $(0.03) $ (0.03) -- -- --
Period ended
03/31/1996**#....... 10.00 (0.09) 0.29 0.20 -- -- --
INVESTOR N SHARES
Six months ended
09/30/1996
(unaudited)......... $10.18 $(0.02) $(0.02) $ (0.04) -- -- --
Period ended
03/31/1996**#....... 10.00 (0.10) 0.29 0.19 -- $(0.01) --
</TABLE>
- ---------------
<TABLE>
<C> <S>
* Nations International Equity Fund's Primary A, Primary B, Investor A, Investor C and Investor N Shares commenced
operations on December 2, 1991, June 28, 1996, June 3, 1992, June 17, 1992 and June 7, 1993, respectively.
** Nations Pacific Growth Fund's Primary A, Investor A, Investor C and Investor N Shares commenced operations on June 30,
1995. Nations Pacific Growth Fund's Primary B Shares commenced operations on June 28, 1996.
*** Amount represents less than $0.01 per share.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and does not reflect the deduction of any
applicable sales charges.
# Per share numbers have been calculated using the monthly average shares method, which more appropriately represents the
per share data for the period, since the use of the undistributed income method did not accord with the results of
operations.
## Amount represents less than 0.01%.
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was May 31.
(b) Average commission rate paid per share of securities purchased and sold by the Fund.
(c) The amount shown at this caption for each share outstanding throughout the period may not accord with the net realized and
unrealized gain/(loss) for the period because of the timing of purchases and withdrawals of shares in relation to the
fluctuating market values of the portfolio.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
24
<PAGE> 27
NATIONS FUND
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
RATIO OF RATIO OF
DISTRIBUTIONS TOTAL NET ASSET NET ASSETS OPERATING NET INVESTMENT
IN EXCESS OF DIVIDENDS VALUE END OF EXPENSES TO INCOME/(LOSS) PORTFOLIO
NET REALIZED AND END OF TOTAL PERIOD AVERAGE NET TO AVERAGE TURNOVER
CAPITAL GAINS DISTRIBUTIONS PERIOD RETURN++ (IN 000'S) ASSETS NET ASSETS RATE
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
-- $ (0.08) $ 13.61 1.38% $944,663 1.14%+ 1.16%+ 19%
-- (0.12) 13.50 16.01 849,731 1.17+ 0.65+ 26
$ (0.10) (0.25) 11.75 (0.46) 572,940 1.03 1.17 92
-- (0.07) 12.06 14.37 401,559 1.17 0.75 39
-- (0.10) 10.60 3.14 118,873 1.30 1.03 41
-- (0.04) 10.40 4.43+++ 83,970 1.33+ 1.81+ 11
-- -- $ 13.59 (0.44)% $ 3,115 1.64%+ 0.66%+ 19%
-- $ (0.07) $ 13.49 1.25% $ 11,220 1.39%+ 0.91%+ 19%
-- (0.10) 13.39 15.66 7,643 1.42+ 0.40+ 26
$ (0.10) (0.24) 11.67 (0.69) 4,877 1.28 0.92 92
-- (0.06) 12.00 14.00 3,219 1.42 0.50 39
-- (0.10) 10.56 2.91 839 1.55+ 0.78+ 41
-- $ (0.05) $ 13.21 1.00% $ 881 1.64%+ 0.66%+ 19%
-- (0.04) 13.13 15.09 652 2.09+ (0.27)+ 26
$ (0.10) (0.22) 11.45 (1.56) 495 2.03 0.17 92
-- (0.03) 11.86 13.21 339 2.17 (0.25) 39
-- (0.09) 10.49 4.97 200 2.30+ 0.03+ 41
-- $ (0.04) $ 13.34 0.84% $ 39,127 2.14%+ 0.16%+ 19%
-- (0.05) 13.27 15.25 40,426 1.99+ (0.17)+ 26
$ (0.10) (0.23) 11.56 (1.30) 31,372 1.78 0.42 92
-- (0.06) 11.96 14.32 17,349 1.92+ (0.00)+## 39
-- $ (0.02) $ 10.24 0.16% $107,860 1.49%+ 0.50%+ 43%
-- (0.03) 10.24 2.66 95,210 1.76+ (0.27)+ 23
-- -- $ 10.23 (1.06)% $ 230 1.99%+ 0.00%+## 43%
-- $ (0.01) $ 10.21 (0.09)% $ 2,490 1.74%+ 0.25%+ 43%
-- (0.02) 10.23 2.52 1,375 2.01+ (0.52)+ 23
-- -- $ 10.17 (0.29)% $ 72 1.99%+ 0.00%+## 43%
-- -- 10.20 2.00 60 2.65+ (1.16)+ 23
-- -- $ 10.14 (0.39)% $ 2,433 2.49%+ (0.50)%+ 43%
-- $ (0.01) 10.18 1.88 2,324 2.76+ (1.27)+ 23
<CAPTION>
WITHOUT WAIVERS AND/OR
OPERATING NET INVESTMENT
EXPENSES TO INCOME/ AVERAGE
AVERAGE NET (LOSS) PER COMMISSION
ASSETS SHARE RATE PAID(b)
- ----
<S> <C> <C> <C>
1.18%+ $ 0.08 $0.0295
1.18+ 0.07 0.0272
1.04 0.14 --
1.18 0.08 --
1.32 0.10 --
1.43+ 0.03 --
1.68%+ $ 0.02 $0.0295
1.43%+ $ 0.06 $0.0295
1.43+ 0.04 0.0272
1.29 0.11 --
1.43 0.05 --
1.62+ 0.07 --
1.68%+ $ 0.04 $0.0295
2.10+ (0.03) 0.0272
2.04 0.02 --
2.18 (0.03) --
2.32+ 0.00*** --
2.18%+ $ 0.01 $0.0295
2.00+ (0.02) 0.0272
1.79 0.05 --
1.93+ (0.00)*** --
-- -- $0.0188
-- -- 0.0178
-- -- $0.0188
-- -- $0.0188
-- -- 0.0178
-- -- $0.0188
-- -- 0.0178
-- -- $0.0188
-- -- 0.0178
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
25
<PAGE> 28
NATIONS FUND
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE INVESTMENT AND UNREALIZED (DECREASE) IN FROM NET IN EXCESS OF
BEGINNING OF INCOME/ GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT NET INVESTMENT
PERIOD (LOSS) INVESTMENTS FROM OPERATIONS INCOME INCOME
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NATIONS EMERGING
MARKETS FUND
PRIMARY A SHARES
Six months ended 09/30/1996
(unaudited)#........................ $10.34 $ 0.03 $ 0.04 $ 0.07 $(0.05) --
Period ended 03/31/1996*#............. 10.00 (0.03) 0.37 0.34 -- $ 0.00***
PRIMARY B SHARES
Period ended 09/30/1996
(unaudited)*#....................... $10.71 $ 0.00*** $(0.36)(b) $ (0.36) -- --
INVESTOR A SHARES
Six months ended 09/30/1996
(unaudited)#........................ $10.32 $ 0.02 $ 0.04 $ 0.06 $(0.04) --
Period ended 03/31/1996*#............. 10.00 (0.05) 0.37 0.32 -- --
INVESTOR C SHARES
Six months ended 09/30/1996
(unaudited)#........................ $10.27 $ 0.00*** $ 0.04 $ 0.04 -- --
Period ended 03/31/1996*#............. 10.00 (0.10) 0.37 0.27 -- --
INVESTOR N SHARES
Six months ended 09/30/1996
(unaudited)#........................ $10.26 $(0.02) $ 0.04 $ 0.02 -- --
Period ended 03/31/1996*#............. 10.00 (0.11) 0.37 0.26 -- --
NATIONS GLOBAL GOVERNMENT INCOME FUND
PRIMARY A SHARES
Six months ended 09/30/1996
(unaudited)......................... $10.07 $ 0.26 $ 0.27 $ 0.53 $(0.26) --
Period ended 03/31/1996**............. 10.00 0.39 0.11 0.50 (0.37) $(0.02)
PRIMARY B SHARES
Period ended 09/30/1996
(unaudited)**....................... $10.13 $ 0.12 $ 0.21 $ 0.33 $(0.12) --
INVESTOR A SHARES
Six months ended 09/30/1996
(unaudited)......................... $10.07 $ 0.25 $ 0.27 $ 0.52 $(0.25) --
Period ended 03/31/1996**............. 10.00 0.37 0.11 0.48 (0.35) $(0.02)
INVESTOR C SHARES
Six months ended 09/30/1996
(unaudited)......................... $10.07 $ 0.24 $ 0.27 $ 0.51 $(0.24) --
Period ended 03/31/1996**............. 10.00 0.33 0.11 0.44 (0.31) $(0.02)
INVESTOR N SHARES
Six months ended 09/30/1996
(unaudited)......................... $10.07 $ 0.21 $ 0.27 $ 0.48 $(0.21) --
Period ended 03/31/1996**............. 10.00 0.32 0.11 0.43 (0.30) $(0.02)
</TABLE>
- ---------------
<TABLE>
<C> <S>
* Nations Emerging Markets Fund's Primary A, Investor A, Investor C and Investor N Shares commenced operations on June 30,
1995. Nations Emerging Markets Fund's Primary B Shares commenced operations on June 28, 1996.
** Nations Global Government Income Fund's Primary A, Investor A, Investor C and Investor N Shares commenced operations on
June 30, 1995. Nations Global Government Income Fund's Primary B Shares commenced operations on June 28, 1996.
*** Amount represents less than $0.01 per share.
++ Total return represents aggregate total return for the period indicated and does not reflect the deduction of any
applicable sales charges.
# Per share numbers have been calculated using the monthly average shares method, which more appropriately represents the
per share data for the period, since the use of the undistributed income method did not accord with results of operations.
(a) Average commission rate paid per share of securities purchased and sold by the Fund.
(b) The amount shown at this caption for each share outstanding throughout the period may not accord with the net realized and
unrealized gain/(loss) for the period because of the timing of purchases and withdrawals of shares in relation to the
fluctuating market values of the portfolio.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
26
<PAGE> 29
NATIONS FUND
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
RATIO OF RATIO OF
DISTRIBUTIONS TOTAL NET ASSET NET ASSETS OPERATING NET INVESTMENT
FROM NET DIVIDENDS VALUE END OF EXPENSES TO INCOME/(LOSS) TO PORTFOLIO
REALIZED AND END OF TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER
CAPITAL GAINS DISTRIBUTIONS PERIOD RETURN++ (IN 000'S) ASSETS ASSETS RATE
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
-- $ (0.05) $ 10.36 0.65% $ 54,683 1.79%+ 0.59%+ 17%
-- 0.00*** 10.34 3.42 47,560 2.13+ (0.38)+ 17
-- -- $ 10.35 (3.36)% $ 28 2.29%+ 0.09%+ 17%
-- $ (0.04) $ 10.34 0.54% $ 639 2.04%+ 0.34%+ 17%
-- -- 10.32 3.20 477 2.38+ (0.63)+ 17
-- -- $ 10.31 0.39% $ 140 2.29%+ 0.09%+ 17%
-- -- 10.27 2.70 23 3.02+ (1.27)+ 17
-- -- $ 10.28 0.19% $ 1,320 2.79%+ (0.41)%+ 17%
-- -- 10.26 2.60 1,209 3.13+ (1.38)+ 17
-- $ (0.26) $ 10.34 5.37% $ 26,918 1.33%+ 5.18%+ 47%
$ (0.04) (0.43) 10.07 5.03 24,753 1.32+ 5.17+ 213
-- $ (0.12) $ 10.34 3.28% $ 57 1.83%+ 4.68%+ 47%
-- $ (0.25) $ 10.34 5.24% $ 15,801 1.58%+ 4.93%+ 47%
$ (0.04) (0.41) 10.07 4.84 14,898 1.57+ 4.92+ 213
-- $ (0.24) $ 10.34 5.11% $ 9 1.83%+ 4.68%+ 47%
$ (0.04) (0.37) 10.07 4.40 9 2.16+ 4.33+ 213
-- $ (0.21) $ 10.34 4.84% $ 187 2.33%+ 4.18%+ 47%
$ (0.04) (0.36) 10.07 4.27 193 2.32+ 4.17+ 213
<CAPTION>
AVERAGE
COMMISSION
RATE PAID(a)
---
<S> <C> <C>
$0.0005
0.0004
$0.0005
$0.0005
0.0004
$0.0005
0.0004
$0.0005
0.0004
--
--
--
--
--
--
--
--
--
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
27
<PAGE> 30
NATIONS FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES.
Nations Fund, Inc. (the "Company") and Nations Fund Portfolios, Inc. ("Nations
Portfolios") are registered under the Investment Company Act of 1940, as amended
(the "1940 Act"), as open-end investment companies. As of the date of this
report, the Company offers five separate portfolios and Nations Portfolios
offers three separate portfolios. Information presented in these financial
statements pertains only to Nations International Equity Fund, Nations Pacific
Growth Fund, Nations Emerging Markets Fund and Nations Global Government Income
Fund (each a "Fund" and collectively, the "Funds"). The financial statements for
the remaining funds of the Company are presented under separate cover. The Funds
currently offer five classes of shares: Primary A Shares, Primary B Shares,
Investor A Shares, Investor C Shares and Investor N Shares. Shareholders of a
Fund have equal voting rights on matters affecting all shareholders of the Fund.
In addition, each class of shares of a Fund has exclusive voting rights on
matters that relate solely to its class and separate voting rights on matters in
which the interests of one class of shares differs from the interests of any
other class. The preparation of financial statements in accordance with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts and disclosures in the
financial statements. Actual results could differ from those estimates. 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. If there are no such bid
and asked quotations, the most recent bid quote is used. 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 principal market makers for such
securities. The valuation of international securities which trade on foreign
exchanges are provided by an independent pricing service approved by the Board
of Directors of each Fund. Each security reported on the NASDAQ National Market
System is valued at the last sales price on the valuation date. Debt obligations
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 market
value under the supervision of the Boards 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, the Fund takes
possession of an underlying 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 is at
least equal at all times to the total amount of the repurchase obligations,
including interest. Generally, in the event of counterparty default, the Fund
has the right to use the collateral to offset losses incurred. There would be a
potential loss to the Fund in the event the Fund is delayed or prevented from
exercising its right 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 right. Unless permitted by the
Securities and Exchange Commission, the Fund will not enter into repurchase
agreements with its investment adviser, distributor or any of their affiliates.
The Funds' investment adviser, acting under the supervision of the Board of
Directors, monitors the value of collateral received as well as the
creditworthiness of those banks and dealers with which the Funds enter into
repurchase agreements to evaluate potential risks.
Foreign Currency: The books and records of the Funds are maintained in 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. Purchases and sales of investment securities, income and expenses are
translated on the respective dates of such transactions. Net realized foreign
currency gains and losses resulting from changes in exchange rates include
foreign currency gains and losses between the trade date and the 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 amounts actually received. The effects of changes in foreign
currency exchange rates on investments in securities are not segregated in the
Statements of Operations from the effects of changes in market prices of those
securities, but are included with the net realized and unrealized gain or loss
on investment securities.
28
<PAGE> 31
NATIONS FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
Foreign Currency Transactions: Generally a Fund may enter into forward currency
exchange contracts only under two circumstances: (i) when the Fund enters into a
contract for the purchase or sale of a security denominated in a foreign
currency, to "lock" in the U.S. exchange rate of the transaction, with such
period being a short-dated contract covering the period between the transaction
date and the settlement date; and (ii) when the investment adviser or investment
sub-adviser believes that the currency of a particular foreign country may
experience a substantial movement against the U.S. dollar. Forward foreign
currency contracts are valued at the forward rate and are marked-to-market
daily. The change in market value is recorded by the Fund as an unrealized gain
or loss. When the contract is closed, the 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.
Forward foreign currency contracts will be used primarily to protect the Funds
from adverse currency movements and will generally not be entered into for terms
greater than one year. The use of forward foreign currency contracts does not
eliminate fluctuations in the underlying prices of the Fund's investment
securities, however, it does establish a rate of exchange that can be achieved
in the future. The use of forward contracts involves the risk that anticipated
currency movements will not be accurately predicted. A forward contract would
limit the risk of loss due to a decline in the value of a particular currency,
however, it also would limit any potential gain that might result should the
value of the currency increase instead of decrease. In addition, the Funds could
be exposed to risks if counterparties to the contracts are unable to meet the
terms of their contracts. The counterparty risk exposure is, therefore, closely
monitored and contracts are only executed with high credit quality financial
institutions.
Securities Transactions and Investment Income: Securities transactions are
accounted for on a trade date basis. Realized gains and losses are computed on
the basis of specific identification of the securities sold. Interest income,
adjusted for amortization of market discounts and premiums on investments, is
earned from the 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 its classes based upon the relative net
assets of each class of shares. Uninvested cash balances earn interest at a rate
agreed upon by the Funds and The Bank of New York.
Dividends and Distributions to Shareholders: Distributions from net investment
income, if any, for Nations International Equity Fund, Nations Pacific Growth
Fund and Nations Emerging Markets Fund are declared and paid each calendar
quarter. Dividends from net investment income for the Nations Global Government
Income Fund are declared on each day the Fund is open for business and paid
monthly. Each Fund will distribute net realized capital gains (including net
short-term capital gains), annually after the fiscal year in which earned unless
offset by any available capital loss carryforward. Additional distributions of
net investment income and capital gains may be made at the discretion of the
Boards 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 Federal 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.
Income Tax: 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 its shareholders. Therefore, no Federal
income tax provision is required. The Funds may be subject to foreign taxes on
income, gains on investments or currency repatriation, a portion of which may be
recoverable. The Funds will accrue such taxes and recoveries as applicable,
based upon their current interpretation of tax rules and regulations that exist
in the markets in which they invest.
Expenses: General expenses of the Company or Nations Portfolios are allocated
to the relevant Fund based upon relative net assets. Operating expenses directly
attributable to a Fund or a class of shares are charged to such Fund's or
class's operations. Expenses of each Fund not directly attributable to the
operations of any class of shares or portfolio are prorated among the classes
based on the relative average net assets of each class of shares.
2. INVESTMENT ADVISORY FEE, SUB-ADVISORY FEE, SUB-INVESTMENT ADVISORY FEE,
ADMINISTRATION FEE AND RELATED PARTY TRANSACTIONS.
The Company and Nations Portfolios each have, on behalf of its Funds, entered
into an investment advisory agreement ("Investment Advisory Agreement") with
NationsBanc Advisors, Inc. ("NBAI"), a wholly-owned subsidiary of
29
<PAGE> 32
NATIONS FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
NationsBank, N.A. ("NationsBank"), pursuant to which NBAI provides investment
advisory services to the Funds. Under the terms of these Investment Advisory
Agreements, NBAI is entitled to receive an advisory fee at the following annual
rates of the average daily net assets of each Fund:
<TABLE>
<CAPTION>
ANNUAL RATE
----------
<S> <C>
Nations International Equity Fund................................................ 0.90%
Nations Pacific Growth Fund...................................................... 0.90
Nations Emerging Markets Fund.................................................... 1.10
Nations Global Government Income Fund............................................ 0.70
</TABLE>
The Company and Nations Portfolios each have entered into sub-advisory
agreements ("Sub-Advisory Agreements") with NBAI and Gartmore Global Partners
("Gartmore"). Gartmore is a joint venture structured as a general partnership
between NB Partner Corp., a wholly-owned subsidiary of NationsBank, and Gartmore
U.S. Limited, a wholly-owned subsidiary of Gartmore Investment Management plc
("Gartmore plc"), which is a United Kingdom company listed on the London Stock
Exchange. National Westminster Bank plc and its affiliated entities own 100% of
the equity of Gartmore plc.
Under the terms of the Sub-Advisory Agreements, Gartmore is entitled to receive
from NBAI a sub-advisory fee for each Fund at the following annual rates of each
Fund's average daily net assets:
<TABLE>
<CAPTION>
ANNUAL RATE
----------
<S> <C>
Nations International Equity Fund................................................ 0.70%
Nations Pacific Growth Fund...................................................... 0.70
Nations Emerging Markets Fund.................................................... 0.85
Nations Global Government Income Fund............................................ 0.54
</TABLE>
Stephens Inc. ("Stephens") serves as the administrator of the Company and
Nations Portfolios pursuant to separate administration agreements
("Administration Agreements"). First Data Investor Services Group, Inc. ("First
Data"), a wholly-owned subsidiary of First Data Corporation, serves as
co-administrator of the Company and Nations Portfolios pursuant to separate
co-administration agreements ("Co-Administration Agreements"). 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 the average daily net assets of the
investment portfolios of the Company and Nations Portfolios and the investment
portfolios of Nations Fund Trust (another registered open-end investment company
which is part of the Nations Fund Family) on a combined basis. NationsBank
serves as the sub-administrator of the Company and Nations Portfolios pursuant
to a sub-administration ("Sub-Administration Agreement") with Stephens. For the
six-months ended September 30, 1996, Stephens earned $329,319 from the Funds for
its administration services, of which $57,915 was paid to NationsBank for its
sub-administration services.
The investment adviser, sub-adviser, administrator and co-administrator may,
from time to time, reduce their fees payable by each Fund (either voluntarily or
pursuant to applicable state limitations). For the six months ended September
30, 1996, the investment adviser for Nations International Equity Fund
voluntarily waived fees in the amount of $151,552.
No officer, director or employee of NBAI, Gartmore, Stephens, First Data, or any
affiliate thereof, receives any compensation from the Company or Nations
Portfolios for serving as a director or officer of the Company or Nations
Portfolios. The Company and Nations Portfolios pay 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. The Company and Nations Portfolios also reimburse
expenses incurred by each director in attending such meetings.
The Company's and Nations Portfolio's eligible directors may participate in a
non-qualified deferred compensation plan 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 Nations Treasury Fund, another
fund of the Company. The expense for the deferred compensation plan is included
in the "Directors' fees and expenses" line of the Statements of Operations.
30
<PAGE> 33
NATIONS FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
The Bank of New York acts as the custodian for the Funds. First Data also serves
as the transfer agent for the Funds' shares. NationsBank of Texas, N.A.
("NationsBank of Texas") acts as the sub-transfer agent for the Primary Shares
of the Funds. For the six months ended September 30, 1996, earned approximately
$11,586 for providing such services. The Funds placed a portion of its portfolio
transactions with firms that are affiliates of NationsBank and NBAI.
Stephens also serves as the distributor of the Funds' shares. For the six months
ended September 30, 1996, the Funds were informed that the distributor received
$61,906 in contingent deferred sales charges from Investor A, Investor C and
Investor N Shares of the Funds. A substantial portion of these fees were paid to
affiliates of NationsBank and NBAI.
3. SHAREHOLDER SERVICING AND DISTRIBUTION PLANS.
The Company and Nations Portfolios each have adopted shareholder administration
plans (each an "Administration Plan") for Primary B Shares of each Fund;
shareholder servicing and distribution plans pursuant to Rule 12b-1 under the
1940 Act for Investor A Shares of each Fund ("Investor A Plan"); a shareholder
servicing plan ("Servicing Plan") for Investor C Shares and Investor N Shares of
each Fund; and a distribution plan ("Distribution Plan") pursuant to Rule 12b-1
under the 1940 Act for Investor C Shares and Investor N Shares of each Fund. The
Administration Plan permits the Funds to compensate institutions for shareholder
administration services provided to their customers that own Primary B Shares.
The Investor A Plan permits the Funds to compensate (i) servicing agents and
selling agents that have entered into a servicing agreement with the Funds for
services provided to their customers that own Investor A Shares and (ii)
Stephens for distribution-related expenses incurred in connection with Investor
A Shares. The Servicing Plan permits the Funds to compensate servicing agents
for services provided to their customers that own Investor C Shares and Investor
N Shares, respectively. The Distribution Plan permits the Funds to compensate or
reimburse Stephens for any activities or expenses primarily intended to result
in the sale of the Funds' Investor C Shares or Investor N Shares, respectively.
Payments under the plans are accrued daily and paid monthly at a rate set from
time to time by the Funds. Fees paid pursuant to the plans are charged as
expenses of each Fund as accrued to Primary B Shares, Investor A Shares,
Investor C Shares and Investor N Shares, respectively.
For the six months ended September 30, 1996, the effective rates paid by the
Funds, as a percentage of average daily net assets, pursuant to the plans are as
follows:
<TABLE>
<CAPTION>
PRIMARY B INVESTOR C INVESTOR C INVESTOR N INVESTOR N
ADMINISTRATION INVESTOR A DISTRIBUTION SERVICING DISTRIBUTION SERVICING
FUND PLAN PLAN PLAN PLAN PLAN PLAN
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Nations International Equity Fund... 0.50% 0.25% 0.25% 0.25% 0.75% 0.25%
Nations Pacific Growth Fund......... 0.50 0.25 0.25 0.25 0.75 0.25
Nations Emerging Markets Fund....... 0.50 0.25 0.25 0.25 0.75 0.25
Nations Global Government
Income Fund....................... 0.50 0.25 0.25 0.25 0.75 0.25
</TABLE>
A substantial portion of the fees paid pursuant to the plans described above are
paid to affiliates of NationsBank and NBAI.
4. PURCHASES AND SALES OF SECURITIES.
The aggregate cost of purchases and proceeds from sales of securities, excluding
U.S. government securities and short-term securities, for the six months ended
September 30, 1996, were as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
-----------------------------
<S> <C> <C>
Fund's expenses are calculated without reduction for fees paid indirectly.[WW]
Nations International Equity Fund.................................. $256,987,986 $171,409,299
Nations Pacific Growth Fund........................................ 52,434,875 43,801,375
Nations Emerging Markets Fund...................................... 18,379,486 8,689,569
Nations Global Government Income Fund.............................. 15,665,883 16,874,400
</TABLE>
31
<PAGE> 34
NATIONS FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
The aggregate costs of purchases and proceeds from sales of U.S. government
securities, for the six months ended September 30, 1996, were as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
-------------------------
<S> <C> <C>
Nations Pacific Growth Fund.................................................. $ 829,268 --
Nations Global Government Income Fund........................................ 3,580,055 $1,508,281
</TABLE>
At September 30, 1996, 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>
Nations International Equity Fund......................................... $131,687,154 $ 38,414,472
Nations Pacific Growth Fund............................................... 9,871,493 4,411,023
Nations Emerging Markets Fund............................................. 4,635,060 3,791,436
Nations Global Government Income Fund..................................... 833,048 416,430
</TABLE>
5. CAPITAL STOCK.
As of September 30, 1996, 270,000,000,000 shares of $.001 par value capital
stock were authorized for the Company and 150,000,000,000 shares of $.001 par
value capital stock were authorized for Nations Portfolios.
6. ORGANIZATION COSTS.
The Funds bear all costs in connection with their organization, including the
fees and expenses of registering and qualifying their 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. In the event that any of the shares issued by a Fund
to its sponsor prior to the commencement of the Fund's public offering ("initial
shares") are redeemed during such amortization period by any holder thereof, the
Fund will be reimbursed by the holder for any unamortized organization costs in
the same proportion as the number of initial 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. LINE OF CREDIT.
The Company participates in a $25 million line of credit provided by Mellon
Bank, N.A. under a line of credit agreement (the "Agreement") dated March 17,
1996. Advances under the Agreement are taken primarily for temporary or
emergency purposes, including the meeting of redemption requests that otherwise
might require the untimely disposition of securities. Under this Agreement,
Nations International Equity Fund may borrow up to the lesser of $10 million or
5% of its net assets. Interest on borrowing is payable either at the higher of
Mellon Bank's Money Market Rate or the London Interbank Offered Rate (LIBOR)
plus 0.25% on an annualized basis. The Fund and the other affiliated entities
which are parties to the Agreement are charged an aggregate commitment fee of
0.25% per annum on the amount of the credit. The Fund shall be liable only for
that portion of the commitment fee with respect to such Fund and shall not be
liable for the portion of the commitment fee of any other Fund. The Agreement
requires, among other things, that each participating Fund maintain a ratio of
not less than 4 to 1 of net assets (not including funds borrowed pursuant to the
Agreement) to
32
<PAGE> 35
NATIONS FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
the aggregate amount of indebtedness permitted pursuant to the Agreement. During
the six months ended September 30, 1996, Nations International Equity Fund did
not borrow under this Agreement.
9. CAPITAL LOSS CARRYFORWARD.
At March 31, 1996, the following Funds had available for Federal income tax
purposes the following unused capital losses:
<TABLE>
<CAPTION>
LOSSES DEFERRED
FUND EXPIRING IN 2004
- -----------------------------------------------------------------------------------------------------------
<S> <C>
Nations Pacific Growth Fund.......................................................... $102,682
Nations Emerging Markets Fund........................................................ 99,373
</TABLE>
Under the current tax law, capital and currency losses realized after October
31, may be deferred and treated as occurring on the first day of the following
fiscal year. For the period ended March 31, 1996, the following Funds elected to
defer losses occurring between November 1, 1995 and March 31, 1996 under these
rules, as follows:
<TABLE>
<CAPTION>
POST-OCTOBER CAPITAL
SHORT-TERM
FUND LOSS DEFERRAL
- -----------------------------------------------------------------------------------------------------------
<S> <C>
Nations Pacific Growth Fund.......................................................... $241,007
Nations Emerging Markets Fund........................................................ 60,015
</TABLE>
33
<PAGE> 36
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 Managed Index 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
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 Income 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
For more complete information, including charges and expenses, please contact
your investment representative or Nations Fund at (800) 982-2271 for a current
prospectus. Please read the prospectus carefully before you invest or send
money.
<PAGE> 37
This report is submitted for the general information of shareholders of Nations
Fund. This material must be accompanied or preceded by a Nations Fund
prospectus.
<PAGE> 38
[NATIONS FUND LOGO] BULK RATE
P.O. Box 34602 U.S. POSTAGE PAID
Charlotte, NC 28234-4602 BOSTON, MA
Toll Free 1-800-982-2271 PERMIT NO.
54201
SAR IN-97817-996
