-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SjN4H5YlNdf/AfPB/89wZB7/hvtj1WPR4aqVDolJgGsotriTlZjgWWKO2WqJDuH5 XuQxJPlabMFaCWdTaFk/bw== 0000935069-99-000077.txt : 19990504 0000935069-99-000077.hdr.sgml : 19990504 ACCESSION NUMBER: 0000935069-99-000077 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990228 FILED AS OF DATE: 19990503 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RBB FUND INC CENTRAL INDEX KEY: 0000831114 STANDARD INDUSTRIAL CLASSIFICATION: [] FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-05518 FILM NUMBER: 99609172 BUSINESS ADDRESS: STREET 1: 400 BELLEVUE PKWY STE 100 CITY: WILMINGTON STATE: DE ZIP: 19809 BUSINESS PHONE: 3027911791 MAIL ADDRESS: STREET 1: 103 BELLEVUE PKWY STREET 2: SUITE 152 CITY: WILMINGTON STATE: DE ZIP: 19809 FORMER COMPANY: FORMER CONFORMED NAME: FUND INC /DE/ DATE OF NAME CHANGE: 19600201 N-30D 1 ROBERTSON STEPHENS SEMI-ANNUAL ================================================================================ ROBERTSON STEPHENS [GRAPHIC OMITTED] Money Market Portfolio Semi-Annual Report February 28, 1999 ================================================================================ THE SANSOM STREET FAMILY THE RBB FUND, INC. SEMI-ANNUAL INVESTMENT ADVISER'S REPORT United States government securities were a clear beneficiary of the global financial turbulence that dominated the markets in the second half of 1998. Propelled by a strong flight to safety, yields on short-term treasury and agency obligations fell sharply. Three-month treasury bill yields, for example, declined to as low as 3.65% in October, a drop of over 100 basis points in less than six months. The reasons for such a strong rally were many. The financial crisis that started a year ago in Asia spread to South America, Latin America and Russia where a devaluation and default made the situation appear particularly ominous. The rescue of a large U.S. based hedge fund in September also weighed heavily on investor confidence. As the threat of economic recession reaching the United States mounted, the Federal Reserve began an aggressive campaign to add liquidity to the financial system. Between September 29 and November 17, the Fed eased monetary policy three times, taking the federal funds rate down to 4.75%. Encouraged by similar moves by other central banks, the financial markets regained some measure of confidence by year-end. Treasury bill yields rose to 4.5% and equity markets staged strong recoveries. In addition to the strong rally in U.S. treasury obligations, the money markets witnessed a flattening of the yield curve as sentiment shifted towards an accommodative Fed that was willing to lower short-term interest rates to protect U.S. economic interests. In response, the Money Market Portfolio sought to maintain moderately extended portfolio maturities to cushion its yield against the likelihood of still lower rates. Additionally, portfolio credit quality was given significant emphasis as both foreign and domestic bank and financial service companies came under intense ratings scrutiny. During the final quarter of the year, we restricted quite a few bank and broker credits from our list of approved securities. As of February 28, the Money Market Portfolio had assets of $2,430,807,411. BlackRock Institutional Management Corporation (Please dial toll-free 800-430-9618 for questions regarding your account or contact your broker.) 1 THE SANSOM STREET FAMILY THE RBB FUND, INC. MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS FEBRUARY 28, 1999 (UNAUDITED) PAR (000) VALUE ------- ------------ CERTIFICATES OF DEPOSIT--13.9% DOMESTIC CERTIFICATES OF DEPOSIT--5.2% First National Bank of Chicago 4.975% 06/07/99 ............................ $ 25,000 $ 25,001,367 4.980% 01/06/00 ............................ 50,000 49,991,778 First Tennessee Bank N.A 4.900% 04/19/99 ............................ 50,000 50,000,000 ------------ 124,993,145 ------------ YANKEE DOLLAR CERTIFICATES OF DEPOSIT--8.7% Canadian Imperial Bank of Commerce 5.025% 01/27/00 ............................ 30,000 29,998,684 5.120% 02/23/00 ............................ 22,300 22,289,278 Credit Communal de Belgique 5.750% 04/01/99 ............................ 30,000 29,998,777 National Westminster Bank 4.980% 01/10/00 ............................ 15,000 14,997,502 Rabobank Nederland 5.660% 07/06/99 ............................ 10,000 10,020,543 Svenska Handelsbanken Inc. 5.720% 03/31/99 ............................ 25,000 24,998,819 Toronto Dominion NY 5.000% 01/05/00 ............................ 15,000 14,998,771 5.100% 02/22/00 ............................ 20,000 19,992,439 Westpac Banking Corp. 5.730% 04/16/99 ............................ 45,000 44,998,370 ------------ 212,293,183 ------------ TOTAL CERTIFICATES OF DEPOSIT (Cost $337,286,328) .................... 337,286,328 ------------ COMMERCIAL PAPER--58.1% AIRCRAFT ENGINES & PARTS--4.0% Allied Signal Inc. 4-2 4.810% 04/30/99 ............................ 48,000 47,615,200 4.830% 05/28/99 ............................ 25,000 24,704,833 4.920% 09/10/99 ............................ 25,000 24,340,583 ------------ 96,660,616 ------------ PAR (000) VALUE -------- ------------ ASSET BACKED SECURITIES--17.5% Barton Capital Corp. 4-2 4.870% 03/12/99 ............................ $ 75,211 $ 75,099,082 4.850% 04/19/99 ............................ 24,944 24,779,335 CXC Inc. 4-2 4.870% 03/16/99 ............................ 20,080 20,039,254 4.850% 04/12/99 ............................ 40,000 39,773,667 Dakota Certificates 4-2 4.880% 03/04/99 ............................ 40,000 39,983,733 4.840% 05/04/99 ............................ 50,000 49,569,778 4.830% 05/21/99 ............................ 25,000 24,728,312 Enterprise Funding Corp. 4-2 4.850% 05/25/99 ............................ 15,753 15,572,606 4.870% 05/25/99 ............................ 12,000 11,862,017 Quincy Cap Corp. 4-2 4.860% 03/12/99 ............................ 27,947 27,905,499 Triple A-1 Funding 4-2 4.860% 04/23/99 ............................ 55,291 54,895,393 Windmill Funding 4-2 4.850% 03/09/99 ............................ 40,000 39,956,889 ------------ 424,165,565 ------------ BANKS--7.7% AB Spin Tab Swedmortgage 3-A-3 5.170% 03/03/99 ............................ 30,000 29,991,383 5.510% 03/04/99 ............................ 25,000 24,988,521 5.060% 04/16/99 ............................ 40,000 39,741,378 4.910% 06/28/99 ............................ 50,000 49,188,486 4.840% 08/16/99 ............................ 20,000 19,548,267 Bank of America FSB 3-A-3 4.830% 07/27/99 ............................ 25,000 24,503,583 ------------ 187,961,618 ------------ BUSINESS CREDIT INSTITUTIONS--2.1% General Electric Capital Corp. 4.940% 03/16/99 ............................ 50,000 49,897,083 ------------ COMMUNICATION EQUIPMENT NEC--1.6% Alcatel Alsthom Inc. 3-A-3 4.900% 06/08/99 ............................ 40,000 39,461,000 ------------ See Accompanying Notes to Financial Statements. 2 THE SANSOM STREET FAMILY THE RBB FUND, INC. MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) FEBRUARY 28, 1999 (UNAUDITED) PAR (000) VALUE --------- ------------ ELECTRONIC & OTHER ELECTRICAL EQUIPMENT--0.4% General Electric Co. 3-A-3 4.820% 06/03/99 .............................. $ 9,969 $ 9,843,535 -------------- LIFE INSURANCE--1.0% Prudential Funding Corp. 3-A-3 4.760% 07/15/99 .............................. 25,000 24,550,444 -------------- MOTOR VEHICLES & CAR BODIES--0.6% Daimler-Benz North America 3-A-3 5.060% 04/05/99 .............................. 15,000 14,926,208 -------------- NEWSPAPER: PUBLISHING & PRINTING--5.5% Knight-Ridder Inc.-DCP 3-A-3 5.200% 03/18/99 .............................. 30,000 29,926,333 4.780% 06/14/99 .............................. 20,000 19,721,167 5.000% 06/14/99 .............................. 15,000 14,781,250 Knight-Ridder Inc.-DCP 4-2 5.200% 03/18/99 .............................. 20,000 19,950,889 5.200% 04/14/99 .............................. 50,000 49,682,222 -------------- 134,061,861 -------------- PERSONAL CREDIT INSTITUTIONS--3.1% General Motors Acceptance Corp. 3-A-3 4.870% 03/01/99 .............................. 75,000 75,000,000 -------------- PETROLEUM REFINING--4.8% Koch Industries, Inc. 4-2 4.850% 03/04/99 .............................. 1,000 999,596 Repsol International 3-A-3 5.180% 03/15/99 .............................. 33,000 32,933,523 4.880% 06/07/99 .............................. 13,590 13,409,464 4.910% 06/28/99 .............................. 21,000 20,659,164 4.870% 07/15/99 .............................. 50,000 49,080,111 -------------- 117,081,858 -------------- SECURITY BROKERS & DEALERS--7.1% Goldman Sachs Group L.P. 5.230% 03/19/99 .............................. 73,000 72,809,105 Merrill Lynch & Co. Inc. 3-A-3 4.920% 03/05/99 .............................. 25,000 24,986,333 4.900% 05/24/99 .............................. 25,000 24,714,167 Morgan Stanley, Dean, Witter & Co. 4.810% 05/14/99 .............................. 50,000 49,505,639 -------------- 172,015,244 -------------- PAR (000) VALUE -------- -------------- SHORT-TERM BUSINESS CREDIT INSTITUTIONS--2.1% Heller Financial Inc. 3-A-3 4.940% 03/24/99 .......................... $ 50,000 $ 49,842,194 -------------- TELEPHONE COMMUNICATIONS--0.6% BellSouth Telecommunications 3-A-3 4.780% 03/05/99 .......................... 12,568 12,561,325 GTE Funding 3-A-3 4.800% 03/26/99 .......................... 3,100 3,089,667 -------------- 15,650,992 -------------- TOTAL COMMERCIAL PAPER (Cost $1,411,118,218) ................ 1,411,118,218 -------------- MUNICIPAL BONDS--3.1% FLORIDA--0.1% Coral Springs,VRDN IDR (Suntrust)(DAGGER) 4.950% 03/03/99 .......................... 2,500 2,500,000 -------------- GEORGIA--0.4% De Kalb County Development Authority VRDN Series 1995 B (Emory University Project)(DAGGER) 4.950% 02/28/99 .......................... 9,485 9,485,000 -------------- ILLINOIS--0.2% Illinois Health Facilities Authority Convertible/ VRDN Revenue Bond (The Streeterville Corp. Project) Series 1993-B (First National Bank of Chicago)(DAGGER) 4.950% 03/03/99 .......................... 4,400 4,400,000 -------------- INDIANA--0.1% Bremen, Inc. VRDN Series 1996 B (Society National Bank, Cleveland)(DAGGER) 5.448% 03/04/99 .......................... 2,800 2,800,000 -------------- KENTUCKY--0.2% Boone County Taxable IDR Refunding Bonds VRDN (Square D Company Project) Series 1994-B (Credit Lyonnais)(DAGGER) 4.950% 03/03/99 .......................... 4,200 4,200,000 -------------- See Accompanying Notes to Financial Statements. 3 THE SANSOM STREET FAMILY THE RBB FUND, INC. MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) FEBRUARY 28, 1999 (UNAUDITED) PAR (000) VALUE --------- ------------ MISSISSIPPI--1.1% Hinds County, IDR Revenue Bond VRDN Series 1992(DAGGER) 4.950% 03/03/99 .......................... $ 1,690 $ 1,690,000 Mississippi Business Finance Corp. IDR Revenue Bond VRDN (Dana Lighting Project) Series 1995 (Sun Bank, N.A., Orlando)(DAGGER) 4.950% 03/07/99 .......................... 5,600 5,600,000 Mississippi Business Finance Corp. Taxable IDR Revenue Bond VRDN (Sun Bank, N.A., Orlando) Series 1995(DAGGER) 4.950% 03/07/99 .......................... 6,300 6,300,000 Mississippi Business Finance Corp. Taxable IDR Revenue Bond VRDN (Bryan Foods, Inc. Project) Series 1994(DAGGER) 4.950% 03/03/99 .......................... 14,000 14,000,000 -------------- 27,590,000 -------------- NORTH CAROLINA--0.4% City of Asheville Tax Corp. VRDN(DAGGER) 4.950% 03/03/99 .......................... 10,800 10,800,000 -------------- TEXAS--0.6% South Central Texas Industrial Development Corp. Taxable IDR Revenue Bond VRDN (Rohr Industries Project) Series 1990 (Citibank N.A.)(DAGGER) 4.950% 03/03/99 .......................... 14,800 14,800,000 -------------- TOTAL MUNICIPAL BONDS (Cost $76,575,000) ................... 76,575,000 -------------- VARIABLE RATE OBLIGATIONS--15.4% BANKS--6.0% Istituto Bancario Sao Paolo di Torino(DAGGER) 5.088% 03/08/99 .......................... 25,000 24,995,328 Nations Bank(DAGGER) 5.303% 04/02/99 .......................... 70,000 70,001,937 Royal Bank of Canada(DAGGER) 4.883% 03/14/99 .......................... 50,000 49,981,110 -------------- 144,978,375 -------------- PAR (000) VALUE -------- -------------- FINANCE SERVICES--2.0% General American Life(DAGGER) 5.140% 03/01/99 .......................... $ 50,000 $ 50,000,000 -------------- PERSONAL CREDIT INSTITUTIONS--6.4% American Honda Finance Corp.(DAGGER) 5.219% 03/14/99 .......................... 40,000 40,000,000 5.200% 03/16/99 .......................... 25,000 25,000,000 4.938% 04/28/99 .......................... 35,000 35,000,000 3.085% 05/25/99 .......................... 15,000 14,997,033 General Motors Acceptance Corp.(DAGGER) 4.914% 05/26/99 .......................... 40,000 39,992,275 -------------- 154,989,308 -------------- SECURITY BROKERS & DEALERS--1.0% Bear Stearns Companies, Inc.(DAGGER) 4.905% 03/08/99 .......................... 25,000 25,000,218 -------------- TOTAL VARIABLE RATE OBLIGATIONS (Cost $374,967,901) .................. 374,967,901 -------------- MEDIUM TERM NOTES--0.3% SECURITY BROKERS & DEALERS--0.3% Goldman Sachs Group LP 5.280% 02/24/00 .......................... 7,500 7,499,852 -------------- TOTAL MEDIUM TERM NOTES (Cost $7,499,852) .................... 7,499,852 -------------- TIME DEPOSITS--3.1% Bank of Montreal 4.875% 03/01/99 .......................... 75,000 75,000,000 -------------- TOTAL TIME DEPOSITS (Cost $75,000,000) ................... 75,000,000 -------------- See Accompanying Notes to Financial Statements. 4 THE SANSOM STREET FAMILY THE RBB FUND, INC. MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONCLUDED) FEBRUARY 28, 1999 (UNAUDITED) PAR (000) VALUE --------- -------------- REPURCHASE AGREEMENTS--5.8 Lehman Brothers (Agreement dated 02/26/99 to be repurchased at $141,356,520, collateralized by $91,564,115 Federal Home Loan Mortgage Corporation Collateralized Mortgage Obligation at rates of 6.23% to 6.849% due 04/15/28 to 09/15/28, $21,738,647 Federal National Mortgage Association Collateralized Mortgage Obligation at a rate of 6.50% due 09/25/28, $10,337,915 Federal Home Loan Mortgage Corporation Collateralized Mortgage Obligation at a rate of 5.44% due 02/15/28, $21,905,196 Federal National Mortgage Association Collateralized Mortgage Obligation at rates of 6.50% to 7.00% due 09/25/28 to 11/15/28. Market Value of Collateral is $145,545,873.) 4.800% 03/01/99 ....................... $141,300 $ 141,300,000 -------------- TOTAL REPURCHASE AGREEMENTS (Cost $141,300,000) ................. 141,300,000 -------------- TOTAL INVESTMENTS AT VALUE--99.7% (Cost $2,423,747,299*) .................. 2,423,747,299 -------------- VALUE -------------- OTHER ASSETS IN EXCESS OF LIABILITIES--0.3% .................... $ 7,060,112 -------------- NET ASSETS (Applicable to 589,664,368 Bedford shares, 158,401 Cash Preservation shares, 1,034,494,733 Janney Montgomery Scott shares, 776,662,225 Sansom Street shares, 29,824,176 Select shares, and 800 other shares)--100.0% ................... $2,430,807,411 ============== NET ASSET VALUE, Offering and Redemption Price Per Share ($2,430,807,411 (DIVIDE) 2,430,804,703 .. $1.00 ===== * Also cost for Federal income tax purposes. (DAGGER) Variable Rate Obligations -- The rate shown is the rate as of February 28, 1999 and the maturity date shown is the longer of the next interest rate readjustment date or the date the principal amount shown can be recovered through demand. INVESTMENT ABBREVIATIONS VRDN ..................................................Variable Rate Demand Note LOC ............................................................Letter of Credit IDR ..............................................Industrial Development Revenue See Accompanying Notes to Financial Statements. 5 THE SANSOM STREET FAMILY THE RBB FUND, INC. MONEY MARKET PORTFOLIO STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED FEBRUARY 28, 1999 (UNAUDITED) Investment Income Interest................................................. $67,932,605 ----------- Expenses Investment advisory fees................................. 4,607,483 Administration fees...................................... -- Distribution fees........................................ 5,473,879 Service organization fees................................ 271,242 Directors' fees.......................................... 32,956 Custodian fees........................................... 201,254 Transfer agent fees...................................... 1,505,760 Legal fees............................................... 56,943 Audit fees............................................... 66,476 Registration fees........................................ 150,000 Insurance expense........................................ 21,022 Printing fees............................................ 266,257 SEC fees................................................. 2,611 Miscellaneous............................................ 326 ----------- 12,656,209 Less fees waived and reimbursements ..................... 2,014,787) ----------- Total expenses ..................................... 10,641,422 ----------- Net investment income ...................................... 57,291,183 ----------- Net realized gain/(loss) on investments .................... 131,056 ----------- Net increase in net assets resulting from operations ....... $57,422,239 =========== See Accompanying Notes to Financial Statements. 6 The SANSOM STREET FAMILY THE RBB FUND, INC. MONEY MARKET PORTFOLIO STATEMENT OF CHNAGES IN NET ASSETS
FOR THE FOR THE SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 1999 AUGUST 31, 1998 ----------------- --------------- (UNAUDITED) Increase (decrease) in net assets: Operations: Net investment income......................................... $ 57,291,183 $ 127,866,778 Net realized gain (loss) on investments ...................... 131,056 (95,478) ----------------- --------------- Net increase in net assets resulting from operations ......... 57,422,239 127,771,300 ----------------- --------------- Distributions to shareholders: Dividends to shareholders from net investment income: Bedford shares.............................................. ( 18,350,903) (56,898,248) Cash Preservation shares.................................... (4,108) (10,274) Janney Montgomery Scott shares.............................. (21,174,670) (38,111,646) Select shares............................................... (352,247) -- Sansom Street shares........................................ (17,409,255) (32,846,610) Dividends to shareholders from net realized short-term gains: Bedford shares.............................................. (2,671) (7,165) Cash Preservation shares.................................... (1) (1) Janney Montgomery Scott shares.............................. (2,921) (3,979) Select shares............................................... (102) -- Sansom Street shares........................................ (2,010) (2,838) Total dividends to shareholders .......................... (57,298,888) (127,880,761) -------------- --------------- Net capital share transactions.................................. 115,125,760 (384,357,868) -------------- --------------- Total increase (decrease) in net assets ........................ 115,249,111 (384,467,329) Net Assets: Beginning of period........................................... 2,315,558,300 2,700,025,629 -------------- --------------- End of period................................................. $2,430,807,411 $ 2,315,558,300 ============== ===============
See Accompanying Notes to Financial Statements. 7 The SANSOM STREET FAMILY THE RBB FUND, INC. FINANCIAL HIGHLIHGTS (b) (FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
MONEY MARKET PORTFOLIO ------------------------------------------------------------------------------------- FOR THE FOR THE FOR THE FOR THE FOR THE SIX MONTHS YEAR YEAR YEAR YEAR ENDED ENDED ENDED ENDED ENDED FEBRUARY 28, 1999 AUGUST 31, 1998 AUGUST 31, 1997 AUGUST 31, 1996 AUGUST 31, 1995 ----------------- --------------- --------------- --------------- --------------- (UNAUDITED) Net asset value, beginning of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 --------- --------- --------- --------- --------- Income from investment operations: Net investment income...................... 0.0242 0.0520 0.0510 0.0518 0.0543 --------- --------- --------- --------- --------- Total from investment operations ........ 0.0242 0.0520 0.0510 0.0518 0.0543 --------- --------- --------- --------- --------- Less distributions Dividends (from net investment income) .... (0.0242) (0.0520) (0.0510) (0.0518) (0.0543) --------- --------- --------- --------- --------- Total distributions.......................... (0.0242) (0.0520) (0.0510) (0.0518) (0.0543) --------- --------- --------- --------- --------- Net asset value, end of period............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ========= ========= ========= ========= ========= Total Return................................. 5.00%(c) 5.34% 5.22% 5.30% 5.57% Ratios /Supplemental Data Net assets, end of period.................. $ 776,676 $ 684,066 $ 570,018 $ 524,359 $ 441,614 Ratios of expenses to average net assets .. .49%(a)(c) .49%(a) .49%(a) .48%(a) .39%(a) Ratios of net investment income to average net assets ...................... 4.89%(c) 5.20% 5.10% 5.18% 5.43% (a) Without the waiver of advisory and transfer agent fees and without the reimbursement of certain operating expenses, the ratios of expenses to average net assets for the Money Market Portfolio would have been .63% for the six months ended February 28, 1999, .62%, .64%, .65% and .59% for the years ended August 31, 1998, 1997, 1996 and 1995, respectively. (b) Financial highlights relate soley to the Sansom Street Class of shares within the portfolio. (c) Annualized
See Accompanying Notes to Financial Statements. 8 THE SANSOM STREET FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1999 (UNAUDITED) NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The RBB Fund, Inc. (the "Fund") is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. The Fund was incorporated in Maryland on February 29, 1988. The Fund has authorized capital of thirty billion shares of common stock of which 19.83 billion shares are currently classified into ninety-seven classes. Each class represents an interest in one of sixteen investment portfolios of the Fund. The classes have been grouped into fifteen separate "families", nine of which have begun investment operations: the RBB Family, the Select Family, the Sansom Street Family, the Bedford Family, the Cash Preservation Family, the Janney Montgomery Money Family, the n/i numeric investors Family, the Boston Partners Family and the Schneider Family. The Sansom Street Family represents interests in the Money Market Portfolio, which is covered in this report. A) SECURITY VALUATION -- Portfolio securities are valued under the amortized cost method, which approximates current market value. Under this method, securities are valued at cost when purchased and thereafter a constant proportionate amortization of any discount or premium is recorded until maturity of the security. Regular review and monitoring of the valuation is performed in an attempt to avoid dilution or other unfair results to shareholders. The Portfolio seeks to maintain net asset value per share at $1.00. B) SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are accounted for on the trade date. The cost of investments sold is determined by use of the specific identification method for both financial reporting and income tax purposes. Interest income is recorded on the accrual basis. Certain expenses, principally distribution, transfer agency and printing, are class specific expenses and vary by class. Expenses not directly attributable to a specific portfolio or class are allocated among all of the portfolios or classes of the Fund based on relative net assets of each portfolio. C) DISTRIBUTIONS TO SHAREHOLDERS -- Dividends from net investment income are declared daily and paid monthly. Any net realized capital gains are distributed at least annually. Income distributions and capital gain distributions are determined in accordance with income tax regulations which may differ from generally accepted accounting principals. D) FEDERAL INCOME TAXES -- No provision is made for Federal taxes as it is the Fund's intention to have each portfolio to continue to qualify for and elect the tax treatment applicable to regulated investment companies under the Internal Revenue Code and make the requisite distributions to its shareholders which will be sufficient to relieve it from Federal income and excise taxes. E) REPURCHASE AGREEMENTS -- Money market instruments may be purchased subject to the seller's agreement to repurchase them at an agreed upon date and price. The seller will be required on a daily basis to maintain the value of the securities subject to the agreement at not less than there repurchase price plus accrued interest. If the value of the underlying securities falls below 102% of the value of the purchase price plus accrued interest, the Fund will require the seller to deposit additional collateral by the next Fund business day. In the event that the seller under the agreement defaults on its repurchase obligation or fails to deposit sufficient collateral, the Fund has the contractual right, subject to the requirements of applicable bankruptcy and insolvency laws, to sell the underlying securities and may claim any resulting loss from the seller. The agreements are conditioned upon the collateral being deposited under the Federal Reserve book-entry system or with the Fund's custodian or a third party sub-custodian. 9 THE SANSOM STREET FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 1999 (UNAUDITED) NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F) USE OF ESTIMATES -- The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumption that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. G) USE OF ESTIMATES -- The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES Pursuant to Investment Advisory Agreements, BlackRock Institutional Management Corporation ("BIMC"), an indirectly majority-owned subsidiary of PNC Bank, serves as investment advisor for the portfolio described herein. For its advisory services, BIMC is entitled to receive the following fees, computed daily and payable monthly based on the portfolio's average daily net assets: .45% of first $250 million of net assets; .40% of next $250 million of net assets; .35% of net assets in excess of $500 million. BIMC may, at its discretion, voluntarily waive all or any portion of its advisory fee for this portfolio. For each class of shares within a respective portfolio, the net advisory fee charged to each class is the same on a relative basis. For the six months ended February 28, 1999, advisory fees and waivers for the investment portfolio were as follows: GROSS NET ADVISORY ADVISORY FEE WAIVER FEE ------------ -------------- ------------ $4,607,483 $(1,724,370) $2,883,113 The investment advisor has agreed to reimburse each portfolio for the amount, if any, by which the total operating and management expenses exceed the cap. For the six months ended February 28, 1999 the reimbursed expenses were $286,257 for the Money Market Portfolio. In addition, PFPC Trust Company serves as custodian for the Fund's portfolio. PFPC Inc. ("PFPC") serves as each class's transfer and dividend disbursing agent. Both PFPC Trust Company and PFPC are wholly-owned subsidiaries of PFPC Worldwide Inc., an indirect majority-owned subsidiary of PNC Bank Corp. 10 THE SANSOM STREET FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 1999 (UNAUDITED) NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES (CONTINUED) PFPC may, at its discretion, voluntarily waive all or any portion of its transfer agency fee for any class of shares. For the six months ended February 28, 1999, transfer agency fees and waivers for each class of shares within the investment portfolio were as follows:
GROSS NET TRANSFER AGENCY TRANSFER AGENCY FEE WAIVER FEE --------------- --------- --------------- Bedford Class $ 366,050 $ -- $ 366,050 Cash Preservation Class 4,419 (4,161) 258 Janney Montgomery Scott Class 840,000 -- 840,000 Sansom Street Class 295,291 -- 295,291 ---------- ------- ---------- Total $1,505,760 $(4,161) $1,501,599 ========== ======= ==========
The Fund, on behalf of each class of shares within this investment portfolio, has adopted Distribution Plans pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. The Fund has entered into Distribution Contracts with Provident Distributors Inc. ("PDI"), which provide for each class to make monthly payments, based on average net assets, to PDI of up to .65% on an annualized basis for the Bedford, Cash Preservation and Janney Montgomery Scott Classes and up to .20% on an annualized basis for the Sansom Street Class. For the six months ended February 28, 1999, distribution fees for each class were as follows: DISTRIBUTION FEE ------------ Bedford Class $2,384,887 Cash Preservation Class 368 Janney Montgomery Scott Class 2,906,358 Sansom Street Class 182,266 ---------- Total $5,473,879 ========== The Fund has entered into service agreements with banks affiliated with PNC Bank who render support services to customers who are the beneficial owners of the Sansom Street Class in consideration of the payment of .10% of the daily net asset value of such shares. For the six months ended February 28, 1999 service organization fees were $271,242 for the Money Market Portfolio. 11 THE SANSOM STREET FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 1999 (UNAUDITED) NOTE 3. CAPITAL SHARES Transactions in capital shares (at $1.00 per capital share) for each year were as follows:
MONEY MARKET PORTFOLIO ------------------------------------------- FOR THE FOR THE SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 1999 AUGUST 31, 1998 ----------------- --------------- (UNAUDITED) VALUE VALUE ----------------- --------------- Shares sold: Bedford Class $1,267,431,197 $ 4,081,920,081 Cash Preservation Class 61,164 113,319 Janney Montgomery Scott Class 2,305,678,119 3,910,533,620 Sansom Street Class 1,317,481,175 2,296,071,622 Select Class 90,525,850 -- Shares issued in reinvestment of dividends: Bedford Class 18,390,680 56,201,453 Cash Preservation Class 4,289 10,291 Janney Montgomery Scott Class 21,655,093 37,882,680 Sansom Street Class 13,647,696 24,189,907 Select Class 347,981 -- Shares repurchased: Bedford Class (1,458,952,186) (4,768,237,064) Cash Preservation Class (133,353) (139,525) Janney Montgomery Scott Class (2,197,396,680) (3,780,710,398) Sansom Street Class (1,202,565,612) (2,242,193,855) Select Class (61,049,653) -- -------------- ------------- Net increase (decrease) $ 115,125,760 $ (384,357,869) -------------- ------------- Sansom Street Shares authorized 1,500,000,000 1,000,000,000 ============== =============
NOTE 4. NET ASSETS At February 28, 1999, net assets consisted of the following: Capital paid-in Bedford Class $589,664,368 Cash Preservation Class 158,401 Janney Montgomery Scott Class 1,034,494,733 Sansom Street Class 776,662,225 Select Class 29,824,176 Other Classes 800 Accumulated net realized loss on investments Bedford Class (12,013) Cash Preservation Class (5) Janney Montgomery Scott Class 8,010 Sansom Street Class 5,203 Select Class 1,513 -------------- $2,430,807,411 ============== 12 THE SANSOM STREET FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 1999 (UNAUDITED) NOTE 5. OTHER FINANCIAL HIGHLIGHTS The Fund currently offers four other classes of shares representing interest in the Money Market Portfolio: Bedford, Cash Preservation, Select, and Janney Montgomery Scott. Each class is marketed to different types of investors. Financial Highlights of the Cash Preservation class is not presented in this report due to its immateriality. Such information is available in the annual report of its respective family. The financial highlights of certain of the other classes are as follows:
THE BEDFORD FAMILY (b) MONEY MARKET PORTFOLIO --------------------------------------------------------------------------------- FOR THE FOR THE FOR THE FOR THE FOR THE SIX MONTHS YEAR YEAR YEAR YEAR ENDED ENDED ENDED ENDED ENDED FEBRUARY 28, 1999 AUGUST 31, 1998 AUGUST 31, 1997 AUGUST 31, 1996 AUGUST 31, 1995 ----------------- --------------- --------------- --------------- --------------- (UNAUDITED) Net asset value, beginning of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 --------- -------- ---------- ---------- -------- Income from investment operations: Net investment income...................... 0.0219 0.0473 0.0462 0.0469 0.0486 --------- -------- ---------- ---------- -------- Total from investment operations ........ 0.0219 0.0473 0.0462 0.0469 0.0486 --------- -------- ---------- ---------- -------- Less distributions Dividends (from net investment income) .... (0.0219) (0.0473 (0.0462) (0.0469) (0.0486) --------- -------- ---------- ---------- -------- Total distributions...................... (0.0219) (0.0473) (0.0462) (0.0469) (0.0486) --------- -------- ---------- ---------- -------- Net asset value, end of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ========= ======== ========== ========== ======== Total Return................................. 4.50%(c) 4.84% 4.72% 4.79% 4.97% Ratios/Supplemental Data Net assets, end of period (000) ........... $ 589,649 $762,739 $1,392,911 $1,109,334 $935,821 Ratios of expenses to average net assets .. .97%(a)(c) .97%(a) .97%(a) .97%(a) .96%(a) Ratios of net investment income to average net assets ............................... 4.41%(c) 4.73% 4.62% 4.69% 4.86% (a) Without the waiver of advisory and administration fees and without the reimbursement of certain operating expenses, the ratios of expenses to average net assets for the Money Market Portfolio would have been 1.11% for the six months ended February 28, 1999, 1.10%, 1.12%, 1.14% and 1.17% for the years ended August 31, 1998, 1997, 1996 and 1995, respectively. (b) Financial Highlights relate solely to the Bedford Class of shares within each portfolio. (c) Annualized
13 THE SANSOM STREET FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 1999 (UNAUDITED) NOTE 5. OTHER FINANCIAL HIGHLIGHTS (CONTINUED)
THE JANNEY MONTGOMERY SCOTT MONEY FUNDS (c) MONEY MARKET PORTFOLIO --------------------------------------------------------------------------------- FOR THE PERIOD FOR THE FOR THE FOR THE FOR THE JUNE 12, 1995 SIX MONTHS YEAR YEAR YEAR (COMMENCEMENT OF ENDED ENDED ENDED ENDED OPERATIONS) TO FEBRUARY 28, 1999 AUGUST 31, 1998 AUGUST 31, 1997 AUGUST 31, 1996 AUGUST 31, 1995 ----------------- --------------- --------------- --------------- --------------- (UNAUDITED) Net asset value, beginning of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ---------- -------- -------- -------- ---------- Income from investment operations: Net investment income...................... 0.0217 0.0469 0.0459 0.0465 0.0112 ---------- -------- -------- -------- ---------- Total from investment operations ........ 0.0217 0.0469 0.0459 0.0465 0.0112 ---------- -------- -------- -------- ---------- Less distributions Dividends (from net investment income) .... (0.0217) (0.0469) (0.0459) (0.0465) (0.0112) ---------- -------- -------- -------- ---------- Total distributions...................... (0.0217) (0.0469) (0.0459) (0.0465) (0.0112) ---------- -------- -------- -------- ---------- Net asset value, end of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ========== ======== ======== ======== ========== Total Return................................. 4.47%(b) 4.81% 4.69% 4.76% 5.30%(b) Ratios/Supplemental Data Net assets, end of period (000) ........... $1,034,508 $904,526 $736,855 $561,865 $ 443,645 Ratios of expenses to average net assets .. 1.00%(a)(b) 1.00%(a) 1.00%(a) 1.00%(a) 1.00%(a)(b) Ratios of net investment income to average net assets ...................... 4.37%(b) 4.69% 4.59% 4.65% 5.04%(b) (a) Without the waiver of advisory, administration and transfer agent fees and without the reimbursement of certain operating expenses, the ratios of expenses to average net assets for the Money Market Portfolio would have been 1.20% for the six months ended February 28, 1999, 1.21%, 1.22%, 1.23% and 1.23% for the years ended August 31, 1998, 1997, 1996 and 1995, respectively. (b) Annualized. (c) Financial Highlights relate solely to the Janney Montgomery Scott Class of shares within each portfolio.
14 THE SANSOM STREET FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONCLUDED) FEBRUARY 28, 1999 (UNAUDITED) NOTE 5. OTHER FINANCIAL HIGHLIGHTS (CONTINUED) THE SELECT FAMILY (b) (c) MONEY MARKET PORTFOLIO ------------------------ FOR THE PERIOD DECEMBER 15, 1998 TO FEBRUARY 28, 1999 --------------------- (UNAUDITED) Net asset value, beginning of period ...................... $ 1.00 --------- Income from investment operations: Net investment income................................... 0.0103 --------- Total from investment operations ..................... 0.0103 --------- Less distributions Dividends (from net investment income) ................. (0.0103) --------- Total distributions................................... (0.0103) --------- Net asset value, end of period............................. $ 1.00 ========= Total Return............................................... 5.06%(d) Ratios /Supplemental Data Net assets, end of period............................... $ 29,824 Ratios of expenses to average net assets ............... .27%(a)(d) Ratios of net investment income to average net assets .. 4.95%(d) (a) Without the waiver of advisory and transfer agent fees and without the reimbursement of certain operating expenses, the ratios of expenses to average net assets for the Money Market Portfolio would have been .46% for the six months ended February 28, 1999. (b) Financial highlights relate soley to the Select Class of shares within the portfolio. (c) On December 15, 1998 the Money Market Portfolio's Select Class began operations. (d) Annualized 15 -----END PRIVACY-ENHANCED MESSAGE-----