0000925723 2012-01-01 2012-12-31 0000925723 fit5:S000010934Member 2012-01-01 2012-12-31 0000925723 fit5:S000010934Member fit5:C000030278Member 2012-01-01 2012-12-31 0000925723 fit5:S000010934Member rr:AfterTaxesOnDistributionsMember fit5:C000030278Member 2012-01-01 2012-12-31 0000925723 fit5:S000010934Member rr:AfterTaxesOnDistributionsAndSalesMember fit5:C000030278Member 2012-01-01 2012-12-31 0000925723 fit5:S000010934Member fit5:BarclaysUsCorporateHighYieldTwoIssuerCappedIndexMember 2012-01-01 2012-12-31 0000925723 fit5:S000010934Member fit5:LipperHighCurrentYieldFundsAverageMember 2012-01-01 2012-12-31 pure iso4217:USD 485BPOS FEDERATED INSTITUTIONAL TRUST 0000925723 2012-12-27 2012-12-31 2012-10-31 false Federated Institutional High Yield Bond Fund (the "Fund") RISK/RETURN SUMMARY: INVESTMENT OBJECTIVE The Fund's investment objective is to seek high current income. RISK/RETURN SUMMARY: FEES AND EXPENSES This table describes the fees and expenses that you may pay if you buy and hold the Fund's Institutional Shares (IS). 0 0 0 0 Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) Shareholder Fees (fees paid directly from your investment) 0.004 0 0.0019 0.0001 0.006 -0.001 0.005 Example This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 for the time periods indicated and then redeem all of your Shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that operating expenses are as shown in the table above and remain the same. Although your actual costs and returns may be higher or lower, based on these assumptions your costs would be: 61 192 335 750 Portfolio Turnover The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund Shares are held in a taxable account. These costs, which are not reflected in Annual Fund Operating Expenses or in the Example, affect the Fund's performance. During the most recent fiscal year, the Fund's portfolio turnover rate was 18% of the average value of its portfolio. RISK/RETURN SUMMARY: INVESTMENTS, RISKS and PERFORMANCE What are the Fund's Main Investment Strategies? The Fund pursues its investment objective by investing primarily in a diversified portfolio of high yield corporate bonds (also known as "junk bonds"), including debt securities issued by U.S. or foreign businesses (including emerging market debt securities). The Fund's investment adviser ("Adviser") selects securities that it believes have attractive risk-return characteristics. The Adviser's securities selection process includes an analysis of the issuer's financial condition, business and product strength, competitive position and management expertise. The Adviser does not limit the Fund's investments to securities of a particular maturity range. The Fund may invest in derivative contracts (for example, futures contracts, option contracts and swap contracts) to implement its investment strategies as more fully described in the Fund's Prospectus. The Fund's investments are subject to credit risks, liquidity risks, risks associated with noninvestment-grade securities, risks related to the economy, interest rate risks, risks of foreign investing, currency risks, leverage risks, risks of investing in emerging market countries and risks of investing in derivative contracts and hybrid instruments, each are more fully described in the Fund's Prospectus. Because the Fund refers to high-yield investments in its name, it will notify shareholders in advance of any change in its investment policies that would enable the Fund to normally invest less than 80% of its assets in investments rated below investment-grade. What are the Main Risks of Investing in the Fund? All mutual funds take investment risks. Therefore, it is possible to lose money by investing in the Fund. The primary factors that may reduce the Fund's returns include:<ul type="square"><li style="margin-left:-20">Counterparty Credit Risk. Credit risk includes the possibility that a party to a transaction involving the Fund will fail to meet its obligations. This could cause the Fund to lose the benefit of the transaction or prevent the Fund from selling or buying other securities to implement its investment strategy.</li></ul><ul type="square"><li style="margin-left:-20">Issuer Credit Risk . It is possible that interest or principal on securities will not be paid when due. Noninvestment-grade securities generally have a higher default risk than investment-grade securities. Such non-payment or default may reduce the value of the Fund's portfolio holdings, its share price and its performance.</li></ul><ul type="square"><li style="margin-left:-20">Liquidity Risk. Liquidity of individual corporate bonds varies considerably. Low-grade corporate bonds have less liquidity than investment-grade securities, which means that it may be more difficult to sell or buy a security at a favorable price or time.</li></ul><ul type="square"><li style="margin-left:-20">Risk Associated with Noninvestment-Grade Securities. Securities rated below investment-grade may be subject to greater interest rate, credit and liquidity risks than investment-grade securities.</li></ul><ul type="square"><li style="margin-left:-20">Risk Related to the Economy. Low-grade corporate bond returns are sensitive to changes in the economy. The value of the Fund's portfolio may decline in tandem with a drop in the overall value of the stock market based on negative developments in the U.S. and global economies.</li></ul><ul type="square"><li style="margin-left:-20">Interest Rate Risk. Prices of fixed-income securities generally fall when interest rates rise. Interest rate changes have a greater effect on the price of fixed-income securities with longer durations. Duration measures the price sensitivity of a fixed-income security to changes in interest rates.</li></ul><ul type="square"><li style="margin-left:-20">Risk of Foreign Investing. Because the Fund invests in securities issued by foreign companies, the Fund's Share price may be more affected by foreign economic and political conditions, taxation policies and accounting and auditing standards than could otherwise be the case.</li></ul><ul type="square"><li style="margin-left:-20">Currency Risk. Exchange rates for currencies fluctuate daily. The value of the Fund's foreign investments and the value of the shares may be affected favorably or unfavorably by changes in currency exchange rates relative to the U.S. dollar.</li></ul><ul type="square"><li style="margin-left:-20">Eurozone Related Risk. A number of countries in the European Union (EU) have experienced, and may continue to experience, severe economic and financial difficulties. Additional EU member countries may also fall subject to such difficulties. These events could negatively affect the value and liquidity of the Fund's investments in euro-denominated securities and derivatives contracts, securities of issuers located in the EU or with significant exposure to EU issuers or countries.</li></ul><ul type="square"><li style="margin-left:-20">Leverage Risk. Leverage risk is created when an investment exposes the Fund to a level of risk that exceeds the amount invested.</li></ul><ul type="square"><li style="margin-left:-20">Risk of Investing in Emerging Market Countries. Securities issued or traded in emerging markets generally entail greater risks than securities issued or traded in developed markets.</li></ul><ul type="square"><li style="margin-left:-20">Risk of Investing in Derivative Contracts and Hybrid Instruments. Derivative contracts and hybrid instruments involve risks different from, or possibly greater than, risks associated with investing directly in securities and other traditional investments. Specific risk issues related to the use of such contracts and instruments include valuation and tax issues, increased potential for losses and/or costs to the Fund, and a potential reduction in gains to the Fund. Each of these issues is described in greater detail in this prospectus.</li></ul><ul type="square"><li style="margin-left:-20">Risk of Loss after Redemption. The Fund may also invest in trade finance loan instruments primarily by investing in other investment companies (which are not available for general investment by the public) that own those instruments, is advised by an affiliate of the Adviser and is structured as an extended payment fund.</li></ul><ul type="square"><li style="margin-left:-20">Technology Risk. Proprietary and third party data and systems are utilized to support decision making for the Fund. Data imprecision, software or other technology malfunctions, programming inaccuracies and similar circumstances may impair the performance of these systems, which may negatively affect Fund performance.</li></ul> The Shares offered by this Prospectus are not deposits or obligations of any bank, are not endorsed or guaranteed by any bank and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other government agency. Performance: Bar Chart and Table Risk/Return Bar Chart The bar chart and performance table below reflects historical performance data for the Fund and are intended to help you analyze the Fund's investment risks in light of its historical returns. The bar chart shows the variability of the Fund's IS class total returns on a calendar year-by-year basis. The Average Annual Total Return table shows returns averaged over the stated periods, and includes comparative performance information. The Fund's performance will fluctuate, and past performance (before and after taxes) is not necessarily an indication of future results. Updated performance information for the Fund is available under the "Products" section at FederatedInvestors.com or by calling 1-800-341-7400. Federated Institutional High Yield Bond Fund - IS Class The Fund's IS class total return for the nine-month period from January 1, 2012 to September 30, 2012, was 12.09%. Within the periods shown in the bar chart, the Fund's IS class highest quarterly return was 18.11% (quarter ended June 30, 2009). Its lowest quarterly return was (17.31)% (quarter ended December 31, 2008). Average Annual Total Return Table In addition to Return Before Taxes, Return After Taxes is shown for the Fund's IS class to illustrate the effect of federal taxes on Fund returns. Actual after-tax returns depend on each investor's personal tax situation, and are likely to differ from those shown. After-tax returns are calculated using a standard set of assumptions. The stated returns assume the highest historical federal income and capital gains tax rates. These after-tax returns do not reflect the effect of any applicable state and local taxes. After-tax returns are not relevant to investors holding Shares through a 401(k) plan, an Individual Retirement Account or other tax-advantaged investment plan. (For the Period Ended December 31, 2011) 0.2315 0.1122 0.0361 0.1128 0.038 -0.2362 0.495 0.1478 0.0568 2002-11-01 2002-11-01 2002-11-01 0.1004 0.0647 0.0656 0.1071 0.0884 0.0753 0.0416 0.044 0.0774 0.0548 0.0568 0.0248 0.0384 0.0496 0.0283 January 1, 2014 up to but not including the later of (the "Termination Date"): (a) January 1, 2014; or (b) the date of the Fund's next effective Prospectus. All mutual funds take investment risks. Therefore, it is possible to lose money by investing in the Fund. The Shares offered by this Prospectus are not deposits or obligations of any bank, are not endorsed or guaranteed by any bank and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other government agency. The bar chart shows the variability of the Fund's IS class total returns on a calendar year-by-year basis. 1-800-341-7400 FederatedInvestors.com The Fund's performance will fluctuate, and past performance (before and after taxes) is not necessarily an indication of future results. After-tax returns are not relevant to investors holding Shares through a 401(k) plan, an Individual Retirement Account or other tax-advantaged investment plan. The stated returns assume the highest historical federal income and capital gains tax rates. These after-tax returns do not reflect the effect of any applicable state and local taxes. <div style="display:none">~ http://www.FederatedInvestors.com/role/ScheduleAnnualTotalReturnsFederatedInstitutionalHighYieldBondFundBarChart column period compact * ~</div> -0.02 <div style="display:none">~ http://www.FederatedInvestors.com/role/ScheduleShareholderFeesFederatedInstitutionalHighYieldBondFund column period compact * ~</div> <div style="display:none">~ http://www.FederatedInvestors.com/role/ScheduleAnnualFundOperatingExpensesFederatedInstitutionalHighYieldBondFund column period compact * ~</div> <div style="display:none">~ http://www.FederatedInvestors.com/role/ScheduleAverageAnnualTotalReturnsTransposedFederatedInstitutionalHighYieldBondFund column period compact * ~</div> <div style="display:none">~ http://www.FederatedInvestors.com/role/ScheduleExpenseExampleFederatedInstitutionalHighYieldBondFund column period compact * ~</div> 0.18 The Fund's IS class total return for the nine-month period 2012-09-30 0.1209 highest quarterly return 2009-06-30 0.1811 lowest quarterly return 2008-12-31 -0.1731 In addition to Return Before Taxes, Return After Taxes is shown for the Fund's IS class to illustrate the effect of federal taxes on Fund returns. 2012-12-28 The Adviser and its affiliates have voluntarily agreed to waive their fees and/or reimburse expenses so that total annual fund operating expenses (excluding Acquired Fund Fees and Expenses) paid by the Fund's IS class (after the voluntary waivers and/or reimbursements) will not exceed 0.49% (the "Fee Limit") up to but not including the later of (the "Termination Date"): (a) January 1, 2014; or (b) the date of the Fund's next effective Prospectus. While the Adviser and its affiliates currently do not anticipate terminating or increasing these arrangements prior to the Termination Date, these arrangements may only be terminated or the Fee Limit increased prior to the Termination Date with the agreement of the Fund's Board of Trustees. Barclays Capital changed the name of the BHY 2% ICI Index from " Barclays Capital U.S. Corporate High Yiield 2% Issuer Capped Index" to "Barclays U.S. Corporate High Yield 2% Issuer Capped Index." The Barclays U.S. Corporate High Yield 2% Issuer Capped Index is a broad based market Index. Lipper figures represent the average of the total returns reported by all the mutual funds designated by Lipper Inc. as falling into the respective categories indicated. They do not reflect sales charges.