N-CSRS 1 ea0207400-09_ncsrs.htm N-CSRS

  

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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FORM N-CSR

CERTIFIED SHAREHOLDER REPORT
OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES

Investment Company Act file number: 811-21829

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BBH TRUST
On behalf of the following series:

BBH Partner Fund — Small Cap Equity
BBH Select Series — Mid Cap Fund
BBH Partner Fund — International Equity
BBH Limited Duration Fund
BBH Income Fund
BBH Select Series — Large Cap Fund
BBH Intermediate Municipal Bond Fund
BBH U.S. Government Money Market Fund
(Exact name of registrant as specified in charter)

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140 Broadway, New York, NY 10005
(Address of principal executive offices) (Zip Code)

Corporation Services Company
251 Little Falls Drive
Wilmington, DE 19808
(Name and address of agent for service)

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Registrant’s telephone number, including area code: (800) 575-1265

Date of fiscal year end: October 31

Date of reporting period: April 30, 2024

Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.

  

 

Item 1.  Reports to Stockholders.

    

Semi-Annual Report

APRIL 30, 2024

BBH Partner Fund — Small Cap Equity

 

BBH PARTNER FUND – SMALL CAP EQUITY

PORTFOLIO ALLOCATION

April 30, 2024 (unaudited)

SECTOR DIVERSIFICATION

 

U.S. $ Value

  

Percent of
Net Assets

Common Stock:

  

 

      

 

Basic Materials

  

$

13,878,000

 

4.7

%

Communications

  

 

36,625,500

  

12.2

 

Consumer Cyclical

  

 

37,530,000

  

12.6

 

Consumer Non-Cyclical

  

 

91,268,458

  

30.7

 

Financials

  

 

22,739,200

  

7.6

 

Industrials

  

 

12,996,750

  

4.4

 

Technology

  

 

60,280,800

  

20.3

 

Cash and Other Assets in Excess of Liabilities

  

 

22,296,201

  

7.5

 

NET ASSETS

  

$

297,614,909

 

100.0%

 

All data as of April 30, 2024. The BBH Partner Fund — Small Cap Equity (the “Fund”) sector diversification is expressed as a percentage of net assets and may vary over time.

The accompanying notes are an integral part of these financial statements.

2

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

PORTFOLIO OF INVESTMENTS

April 30, 2024 (unaudited)

All investments in the United States, except as noted.

Shares

          

Value
   

COMMON STOCK (92.5%)

      

 

  
   

BASIC MATERIALS (4.7%)

      

 

  

600,000

  

Element Solutions, Inc.

      

$

13,878,000
   

Total Basic Materials

      

 

13,878,000
           

 

  
   

COMMUNICATIONS (12.2%)

      

 

  

1,350,000

  

Despegar.com Corp. (British Virgin Islands)1

      

 

16,456,500

900,000

  

Upwork, Inc.1

      

 

10,530,000

2,700,000

  

WideOpenWest, Inc.1

      

 

9,639,000
   

Total Communications

      

 

36,625,500
           

 

  
   

CONSUMER CYCLICAL (12.6%)

      

 

  

3,750,000

  

ThredUp, Inc. (Class A)1

      

 

6,000,000

600,000

  

XPEL, Inc.1

      

 

31,530,000
   

Total Consumer Cyclical

      

 

37,530,000
           

 

  
   

CONSUMER NON-CYCLICAL (30.7%)

      

 

  

525,000

  

Alarm.com Holdings, Inc.1

      

 

34,912,500

155,142

  

Cimpress, Plc. (Ireland)1

      

 

13,228,958

250,000

  

EVERTEC, Inc. (Puerto Rico)

      

 

9,382,500

400,000

  

Franklin Covey Co.1

      

 

15,576,000

250,000

  

iRadimed Corp.

      

 

10,152,500

600,000

  

SoundThinking, Inc.1

      

 

8,016,000
   

Total Consumer Non-Cyclical

      

 

91,268,458
           

 

  
   

FINANCIALS (7.6%)

      

 

  

100,000

  

StoneX Group, Inc.1

      

 

7,260,000

220,000

  

Triumph Financial, Inc.1

      

 

15,479,200
   

Total Financials

      

 

22,739,200
           

 

  
   

INDUSTRIALS (4.4%)

      

 

  

775,000

  

Astronics Corp.1

      

 

12,996,750
   

Total Industrials

      

 

12,996,750

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

3

 

BBH PARTNER FUND – SMALL CAP EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

All investments in the United States, except as noted.

Shares

          

Value
   

COMMON STOCK (continued)

    

 

  

 

  
   

TECHNOLOGY (20.3%)

    

 

  

 

  

150,000

  

Agilysys, Inc.1

    

 

  

$

12,457,500

340,000

  

Model N, Inc.1

    

 

  

 

10,081,000

70,000

  

Onto Innovation, Inc.1

    

 

  

 

12,984,300

450,000

  

PagerDuty, Inc.1

    

 

  

 

8,982,000

1,600,000

  

Zuora, Inc. (Class A)1

    

 

  

 

15,776,000
   

Total Technology

    

 

  

 

60,280,800
   

Total Common Stock
(Cost $286,864,126)

    

 

  

 

275,318,708
         

 

  

 

  

TOTAL INVESTMENTS (Cost $286,864,126)2

  

92.5

%

  

$

275,318,708

CASH AND OTHER ASSETS IN EXCESS OF LIABILITIES

  

7.5

%

  

 

22,296,201

NET ASSETS

  

100.00

%

  

$

297,614,909

____________

​1       Non-income producing security.

​2    The aggregate cost for federal income tax purposes is $286,864,126, the aggregate gross unrealized appreciation is $42,013,052 and the aggregate gross unrealized depreciation is $53,558,470, resulting in net unrealized depreciation of $11,545,418.

The accompanying notes are an integral part of these financial statements.

4

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Fair Value Measurements

The Fund is required to disclose information regarding the fair value measurements of the Fund’s assets and liabilities. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The disclosure requirement established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including for example, the risk inherent in a particular valuation technique used to measure fair value including such a pricing model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the Fund’s own considerations about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

Authoritative guidance establishes three levels of the fair value hierarchy as follows:

— Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities.

— Level 2 – significant other observable inputs (including quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.).

— Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities).

Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. Inputs may include price information, specific and broad credit data, liquidity statistics, and other factors. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires judgment by the investment adviser. The investment adviser considers observable data to be that market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The categorization of a financial instrument within the hierarchy is based upon the pricing transparency of the instrument and does not necessarily correspond to the investment adviser’s perceived risk of that instrument.

Financial assets within Level 1 are based on quoted market prices in active markets. The Fund does not adjust the quoted price for these instruments.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

5

 

BBH PARTNER FUND – SMALL CAP EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. These include investment-grade corporate bonds, U.S. Treasury notes and bonds, and certain non-U.S. sovereign obligations, listed equities and over-the-counter derivatives and foreign equity securities whose values could be impacted by events occurring before the Fund’s pricing time, but after the close of the securities’ primary markets and are, therefore, fair valued according to procedures adopted by the Board of Trustees. As Level 2 financial assets include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

Financial assets classified within Level 3 have significant unobservable inputs, as they trade infrequently. Level 3 financial assets include private equity and certain corporate debt securities.

Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon the actual sale of those investments.

The following table summarizes the valuation of the Fund’s investments by the above fair value hierarchy levels as of April 30, 2024.

Investments, at value

  

Unadjusted
Quoted Prices in
Active Markets
for Identical
Investments
(Level 1)

  

Significant
Other
Observable
Inputs
(Level 2)

  

Significant
Unobservable
Inputs
(Level 3)

  

Balance as of
April 30, 2024

Common Stock:

  

 

    

 

    

 

    

 

  

Basic Materials

  

$

13,878,000

 

$

—

  

$

—

  

$

13,878,000

Communications

  

 

36,625,500

  

 

—

  

 

—

  

 

36,625,500

Consumer Cyclical

  

 

37,530,000

  

 

—

  

 

—

  

 

37,530,000

Consumer Non-Cyclical

  

 

91,268,458

  

 

—

  

 

—

  

 

91,268,458

Financials

  

 

22,739,200

  

 

—

  

 

—

  

 

22,739,200

Industrials

  

 

12,996,750

  

 

—

  

 

—

  

 

12,996,750

Technology

  

 

60,280,800

  

 

—

  

 

—

  

 

60,280,800

Total Investments, at value

  

$

275,318,708

 

$

—

  

$

—

  

$

275,318,708

The accompanying notes are an integral part of these financial statements.

6

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

STATEMENT OF ASSETS AND LIABILITIES

April 30, 2024 (unaudited)

ASSETS:

    

Investments in securities, at value (Cost $286,864,126)

  

$

275,318,708

 

Cash

  

 

23,279,915

 

Receivables for:

  

 

  

 

Investments sold

  

 

296,403

 

Shares sold

  

 

50,800

 

Interest from Custodian

  

 

30,113

 

Dividends

  

 

11,250

 

Prepaid expenses

  

 

2,517

 

Total Assets

  

 

298,989,706

 
   

 

  

 

LIABILITIES:

  

 

  

 

Payables for:

  

 

  

 

Shares redeemed

  

 

671,212

 

Investments purchased

  

 

430,200

 

Investment advisory and administrative fees

  

 

213,409

 

Professional fees

  

 

34,608

 

Custody and fund accounting fees

  

 

12,092

 

Transfer agent fees

  

 

6,532

 

Board of Trustees’ fees

  

 

368

 

Accrued expenses and other liabilities

  

 

6,376

 

Total Liabilities

  

 

1,374,797

 

NET ASSETS

  

$

297,614,909

 
   

 

  

 

Net Assets Consist of:

  

 

  

 

Paid-in capital

  

$

404,492,055

 

Accumulated deficit

  

 

(106,877,146

)

Net Assets

  

$

297,614,909

 
   

 

  

 

NET ASSET VALUE AND OFFERING PRICE PER SHARE

  

 

  

 

CLASS I SHARES

  

 

  

 

($297,614,909 ÷ 40,456,782 shares outstanding)

  

 

$7.36

 

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

7

 

BBH PARTNER FUND – SMALL CAP EQUITY

STATEMENT OF OPERATIONS

For the six months ended April 30, 2024

NET INVESTMENT LOSS:

  

 

  

 

Income:

  

 

  

 

Dividends

  

$

281,250

 

Interest income from Custodian

  

 

284,055

 

Total Income

  

 

565,305

 
   

 

  

 

Expenses:

  

 

  

 

Investment advisory and administrative fees

  

 

1,324,516

 

Board of Trustees’ fees

  

 

39,549

 

Professional fees

  

 

30,635

 

Transfer agent fees

  

 

19,864

 

Custody and fund accounting fees

  

 

10,701

 

Miscellaneous expenses

  

 

22,197

 

Total Expenses

  

 

1,447,462

 

Net Investment Loss

  

 

(882,157

)
   

 

  

 

NET REALIZED AND UNREALIZED GAIN:

  

 

  

 

Net realized loss on investments in securities

  

 

(10,034,336

)

Net change in unrealized appreciation/(depreciation) on investments in securities

  

 

49,888,655

 

Net Realized and Unrealized Gain

  

 

39,854,319

 

Net Increase in Net Assets Resulting from Operations

  

$

38,972,162

 

The accompanying notes are an integral part of these financial statements.

8

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

STATEMENTS OF CHANGES IN NET ASSETS
 

For the
six months ended
April 30, 2024
(unaudited)

  

For the
year ended
October 31, 2023

INCREASE/(DECREASE) IN NET ASSETS FROM:

  

 

  

 

  

 

  

 

Operations:

  

 

  

 

  

 

  

 

Net investment loss

  

$

(882,157

)

  

$

(1,881,867

)

Net realized loss on investments in securities

  

 

(10,034,336

)

  

 

(44,430,148

)

Net change in unrealized appreciation/(depreciation) on investments in securities

  

 

49,888,655

 

  

 

44,905,317

 

Net increase/(decrease) in net assets resulting from operations

  

 

38,972,162

 

  

 

(1,406,698

)
   

 

  

 

  

 

  

 

Share transactions:

  

 

  

 

  

 

  

 

Proceeds from sales of shares

  

 

16,739,668

 

  

 

38,511,518

 

Cost of shares redeemed

  

 

(50,947,083

)

  

 

(88,309,082

)

Net decrease in net assets resulting from share transactions

  

 

(34,207,415

)

  

 

(49,797,564

)

Total increase/(decrease) in net assets

  

 

4,764,747

 

  

 

(51,204,262

)
   

 

  

 

  

 

  

 

NET ASSETS:

  

 

  

 

  

 

  

 

Beginning of period/year

  

 

292,850,162

 

  

 

344,054,424

 

End of period/year

  

$

297,614,909

 

  

$

292,850,162

 

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

9

 

BBH PARTNER FUND – SMALL CAP EQUITY

FINANCIAL HIGHLIGHTS

Selected per share data and ratios for a Class I share outstanding throughout each period/year.
 


For the six months ended
April 30, 2024
(unaudited)

  



For the years ended
October 31,

  

For the period from
July 8, 2021
(commencement of
operations) to
October 31, 2021

2023

  

2022

  

Net asset value, beginning of period/year

  

$

6.49

 

  

$

6.56

 

  

$

9.85

 

  

$

10.00

 

Income from investment operations:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Net investment loss1

  

 

(0.02

)

  

 

(0.04

)

  

 

(0.05

)

  

 

(0.03

)

Net realized and unrealized gain/(loss)

  

 

0.89

 

  

 

(0.03

)

  

 

(3.18

)

  

 

(0.12

)

Total income/(loss) from investment operations

  

 

0.87

 

  

 

(0.07

)

  

 

(3.23

)

  

 

(0.15

)

Dividends and distributions to shareholders:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

From net realized gains

  

 

—

 

  

 

—

 

  

 

(0.06

)

  

 

—

 

Total dividends and distributions to shareholders

  

 

—

 

  

 

—

 

  

 

(0.06

)

  

 

—

 

Net asset value, end of period/year

  

$

7.36

 

  

$

6.49

 

  

$

6.56

 

  

$

9.85

 

Total return2

  

 

13.41

%3

  

 

(1.07

)%

  

 

(32.97

)%

  

 

(1.50

)%3
   

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Ratios/Supplemental data:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Net assets, end of period/year (in millions)

  

$

298

 

  

$

293

 

  

$

344

 

  

$

322

 

Ratio of expenses to average net assets before reductions

  

 

0.93

%4

  

 

0.92

%

  

 

0.92

%

  

 

0.93

%5

Fee waiver6

  

 

—

%

  

 

—

%

  

 

(0.00

)%7

  

 

(0.01

)%5

Ratio of expenses to average net assets after reductions

  

 

0.93

%4

  

 

0.92

%

  

 

0.92

%

  

 

0.92

%5

Ratio of net investment loss to average net assets

  

 

(0.57

)%4

  

 

(0.56

)%

  

 

(0.70

)%

  

 

(0.83

)%5

Portfolio turnover rate

  

 

7

%3

  

 

27

%

  

 

16

%

  

 

3

%3

____________

​1        Calculated using average shares outstanding for the period/year.

​2        Assumes the reinvestment of distributions.

​3        Not annualized.

​4        Annualized.

​5        Annualized with the exception of audit fees, legal fees and registration fees.

​6   The ratio of expenses to average net assets for the six months ended April 30, 2024, the years ended October 31, 2023, 2022 and the period from July 8, 2021 to October 31, 2021 reflects fees reduced as result of a voluntary operating expense waiver. For the six months ended April 30, 2024, the years ended October 31, 2023, 2022 and the period from July 8, 2021 to October 31, 2021, the waived fees were $-, $-, $2,089 and $40,593, respectively.

​7        Less than 0.01%.

The accompanying notes are an integral part of these financial statements.

10

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

NOTES TO FINANCIAL STATEMENTS

April 30, 2024 (unaudited)

1.  Organization. The Fund is a separate, non-diversified series of BBH Trust (the “Trust”), which is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust was originally organized under the laws of the State of Maryland on July 16, 1990 as BBH Fund, Inc. and re-organized as a Delaware statutory trust on June 12, 2007. As of April 30, 2024, there were eight series of the Trust. The Fund commenced operations on July 8, 2021 and offers one share class, Class I. The investment objective of the Fund is to provide investors with long-term growth of capital. Under normal circumstances, at least 80% of the net assets of the Fund, plus any borrowings for investment purposes, are invested in small cap equity securities publicly traded and issued by domestic issuers directly.

2. Significant Accounting Policies. The Fund’s financial statements are prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”). The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 Financial Services – Investment Companies. The following summarizes significant accounting policies of the Fund:

A. Valuation of Investments. The Board of Trustees (the “Board”) has ultimate responsibility for the supervision and oversight of the determination of the fair value of investments. Pursuant to Rule 2a-5 of the 1940 Act, the Board has designated the Investment Adviser as its valuation designee. The Investment Adviser monitors the continual appropriateness of valuation methods applied and determines if adjustments should be made in light of market factor changes and events affecting issuers. The Investment Adviser performs a series of activities to provide reasonable assurance of the appropriateness of the prices utilized, including but not limited to: periodic independent pricing service due diligence meetings and reviewing the results of back testing on a monthly basis. The Investment Adviser provides the Board with reporting on the results of the back testing as well as positions which were fair valued during the period.

All securities and other investments are recorded at their estimated fair value. The value of investments listed on a securities exchange is based on the last sale price prior to the time when assets are valued, or in the absence of recorded sales, at the most recent bid price on such exchange. If a readily available market quotation is not available or is determined to be unreliable, the investments may be valued utilizing evaluated prices provided by independent pricing services. In establishing such prices, the independent pricing service utilizes both dealer supplied prices and electronic data processing techniques which take into account appropriate factors such as institutional sized trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics, the closure of the primary exchange on which securities trade and before the Fund’s net asset value is next determined and other market data without exclusive reliance on quoted exchange prices or over-the-counter prices since such valuations are believed to reflect more accurately the fair value of such investments. Investments may be fair valued by Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“SID” or “Investment Adviser”) in accordance with the BBH Trust Portfolio Valuation Policy and Procedures using methods

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

11

 

BBH PARTNER FUND – SMALL CAP EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

that most fairly reflect the amount that the Fund would reasonably expect to receive for the investment on a current sale in its principal market in the ordinary course of business. Short-term investments, which mature in 60 days or less are valued at amortized cost if their original maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if their original maturity when acquired by the Fund was more than 60 days, unless the use of amortized cost is determined not to represent fair value. Any futures contracts held by the Fund are valued daily at the official settlement price of the exchange on which they are traded.

B. Accounting for Investments and Income. Investment transactions are accounted for on the trade date. Realized gains and losses on investment transactions are determined based on the identified cost method. Dividend income and other distributions received from portfolio securities are recorded on the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of securities received at ex-date. Distributions received on securities that represent a return of capital are recorded as a reduction of cost of investments. Distributions received on securities that represent a capital gain are recorded as a realized gain. Interest income is accrued daily. Investment income is recorded net of any foreign taxes withheld where recovery of such tax is uncertain.

C. Fund Expenses. Most expenses of the Trust can be directly attributed to a specific fund. Expenses which cannot be directly attributed to a fund are generally apportioned among each fund in the Trust on a net assets basis or other suitable method. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

D. Federal Income Taxes. It is the Trust’s policy to comply with the requirements of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. The Fund files a tax return annually using tax accounting methods required under provisions of the Code, which may differ from GAAP, which is the basis on which these financial statements are prepared. Accordingly, the amount of net investment income and net realized gain reported in these financial statements may differ from that reported on the Fund’s tax return, due to certain book-to-tax timing differences such as losses deferred due to “wash sale” transactions and utilization of capital loss carryforwards. These differences may result in temporary over-distributions for financial statement purposes and are classified as distributions in excess of accumulated net realized gains or net investment income. These distributions do not constitute a return of capital. Permanent differences are reclassified between paid-in capital and retained earnings/(accumulated deficit) within the Statement of Assets and Liabilities based upon their tax classification. As such, the character of distributions to shareholders reported in the Financial Highlights table may differ from that reported to shareholders on Form 1099-DIV.

The Fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (“ASC 740”). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The Fund did not have any

12

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

unrecognized tax benefits as of October 31, 2023, nor were there any increases or decreases in unrecognized tax benefits for the year then ended. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits as an income tax expense in the Statement of Operations. During the six months ended April 30, 2024, the Fund did not incur any such interest or penalties. The Fund is subject to examination by U.S. federal and state tax authorities for returns filed for open tax period since July 8, 2021 (commencement of operations). The Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

E. Dividends and Distributions to Shareholders. Dividends and distributions from net investment income to shareholders, if any, are paid annually and are recorded on the ex-dividend date. Distributions from net capital gains, if any, are generally declared and paid annually and are recorded on the ex-dividend date. The Fund did not declare any dividends and distributions to shareholders during the six months ended April 30, 2024.

The tax character of distribution paid during the year ended October 31, 2023 and 2022, respectively, were as follows:

 

Distribution paid from:
       

Ordinary
income

  

Net
long-term
capital gain

  

Total
taxable
distributions

  

Tax return
of capital

  

Total
distributions
paid
   

2023:

  

$

—

  

$

    —

  

$

—

  

$

    —

  

$

—
   

2022:

  

 

2,050,868

  

 

—

  

 

2,050,868

  

 

—

  

 

2,050,868

As of October 31, 2023 and 2022, respectively, the components of retained earnings/(accumulated deficit) were as follows:

 

Components of retained earnings/(accumulated deficit):
       

Undistributed
ordinary
income

  

Undistributed
long-term
capital gain

  

Accumulated
capital and
other losses

  

Other
book/tax
temporary
differences

  

Late year
ordinary
loss
deferral

  

Unrealized
appreciation/
(depreciation)

  

Total
retained
earnings/
(accumulated
deficit)
   

2023:

  

$

—

  

$

—

  

$

(82,240,458

)

  

$

(600,090

)

  

$

(1,574,687

)

  

$

(61,434,073

)

  

$

(145,849,308

)
   

2022:

  

 

—

  

 

—

  

 

(38,410,400

)

  

 

—

 

  

 

(2,031,614

)

  

 

(106,339,390

)

  

 

(146,781,404

)

The Fund had $82,240,458 net capital loss carryforwards as of October 31, 2023, of which $35,054,654 and $47,185,804, is attributable to short-term and long-term capital losses, respectively.

The Fund is permitted to carryforward capital losses for an unlimited period and they will retain their character as either short-term or long-term capital losses.

Total distributions paid may differ from amounts reported in the Statements of Changes in Net Assets because, for tax purposes, dividends are recognized when actually paid.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

13

 

BBH PARTNER FUND – SMALL CAP EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

The differences between book-basis and tax-basis unrealized appreciation/(depreciation) would be attributable primarily to the tax deferral of losses on wash sales, if applicable.

To the extent future capital gains are offset by capital loss carryforwards, if any, such gains will not be distributed.

F.  Use of Estimates. The preparation of the financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increase and decrease in net assets from operations during the reporting period. Actual results could differ from these estimates.

3. Fees and Other Transactions with Affiliates.

A. Investment Advisory and Administrative Fees. Under a combined Investment Advisory and Administrative Services Agreement (“Agreement”) with the Trust, Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“Investment Adviser”) provides investment advisory, portfolio management and administrative services to the Fund. The Fund pays a combined fee for investment advisory and administrative services calculated daily and paid monthly at an annual rate equivalent to 0.85% per annum on the first $3 billion of the Fund’s average daily net assets and 0.80% per annum on the Fund’s average daily net assets over $3 billion. BBH employs a “manager-of-managers” investment approach, whereby it allocates the Fund’s assets to the Fund’s sub-adviser, currently Bares Capital Management, Inc. (“Bares Capital Management” or the “Sub-Adviser”). The Sub-adviser is responsible for investing the assets of the Fund and the Investment Adviser oversees the Sub-adviser and evaluates its performance results. The Investment Adviser pays its Sub-Adviser the entire amount of its investment advisory and administrative fees. For the six months ended April 30, 2024, the Fund incurred $1,324,516 under the Agreement.

B. Custody and Fund Accounting Fees. BBH acts as a custodian and fund accountant and receives custody and fund accounting fees from the Fund calculated daily and paid monthly. BBH holds all of the Fund’s cash and investments and calculates the Fund’s daily net asset value. The custody fee is based partially on asset values and partially on individual fund transactions. The fund accounting fee is primarily an asset-based fee calculated at 0.325 basis points per annum of the Fund’s net asset value. For the six months ended April 30, 2024, the Fund incurred $10,701 in custody and fund accounting fees. As per agreement with the Fund’s custodian, the Fund receives interest income on cash balances held by the custodian at the BBH Base Rate. The BBH Base Rate is defined as BBH’s effective trading rate in local money markets on each day. The total interest earned by the Fund for the six months ended April 30, 2024 was $284,055. This amount is included in “Interest income from Custodian” in the Statement of Operations. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to their agreement, the Fund will pay the BBH Overdraft Base Rate plus 2% on the day of

14

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

the overdraft. The total interest incurred by the Fund for the six months ended April 30, 2024, was $43. This amount is included under line item “Custody and fund accounting fees” in the Statement of Operations.

C. Board of Trustees’ Fees. Each Trustee who is not an “interested person” as defined under the 1940 Act receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the six months ended April 30, 2024, the Fund incurred $39,549 in independent Trustee compensation and expense reimbursements.

D. Officers of the Trust. Officers of the Trust are also employees of BBH. Officers are paid no fees by the Trust for their services to the Trust.

4.  Investment Transactions. For the six months ended April 30, 2024, the cost of purchases and the proceeds of sales of investment securities, other than short-term investments, were $22,179,265 and $69,087,428, respectively.

5. Shares of Beneficial Interest. The Trust is permitted to issue an unlimited number of Class I shares of beneficial interest at no par value. Transactions in Class I shares were as follows:

 

For the six months ended
April 30, 2024 (unaudited)

  

For the year ended
October 31, 2023

Shares

  

Dollars

  

Shares

  

Dollars

Class I

    

 

  

 

  

 

    

 

  

 

  

 

Shares sold

  

2,292,032

 

  

$

16,739,668

 

  

5,587,651

 

  

$

38,511,518

 

Shares redeemed

  

(6,931,395

)

  

 

(50,947,083

)

  

(12,908,538

)

  

 

(88,309,082

)

Net decrease

  

(4,639,363

)

  

$

(34,207,415

)

  

(7,320,887

)

  

$

(49,797,564

)

6. Principal Risk Factors and Indemnifications.

A. Principal Risk Factors. Investing in the Fund may involve certain risks, as discussed in the Fund’s prospectus, including but not limited to, those described below:

A shareholder may lose money by investing in the Fund (investment risk). The Fund is actively managed and the decisions by the Investment Adviser may cause the Fund to incur losses or miss profit opportunities (management risk). Price movements may occur due to factors affecting individual companies, such as the issuance of an unfavorable earnings report, or other events affecting particular industries or the equity market as a whole (equity securities risk). Small cap companies, when compared to larger companies, may experience lower trading volume and could be subject to greater and less predictable price changes (small cap company risk). The fund will invest 25% or more of its net assets in the Software & Services Industry Group. When a fund focuses its investments in a particular industry, group of industries, or sector, financial, economic business and other developments affecting issuers in those industries or groups of industries will

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

15

 

BBH PARTNER FUND – SMALL CAP EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

have a greater effect on the fund than if the fund did not focus on an industry or group of industries (Software & Service Industry Group Concentration risk). The value of securities held by the Fund may fall due to changing economic, political, regulatory or market conditions, or due to a company’s or issuer’s individual situation. Natural disasters, the spread of infectious illness and other public health emergencies, recession, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse effects on world economies and markets generally (market risk). In the normal course of business, the Fund invests in securities and enters into transactions where risks exist due to assumption of large positions in securities of a small number of issuers (non-diversification risk). The Fund’s shareholders may be adversely impacted by asset allocation decisions made by an investment adviser whose discretionary clients make up a large percentage of the Fund’s shareholders (large shareholder risk). The extent of the Fund’s exposure to these risks in respect to these financial assets is included in their value as recorded in the Fund’s Statement of Assets and Liabilities.

Please refer to the Fund’s prospectus for a complete description of the principal risks of investing in the Fund.

B. Indemnifications. Under the Trust’s organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the Fund, and shareholders are indemnified against personal liability for the obligations of the Trust. Additionally, in the normal course of business, the Fund enters into agreements with service providers that may contain indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss from such claims is considered remote.

7. Subsequent Events. Management has evaluated events and transactions that have occurred since April 30, 2024 through the date the financial statements were issued and determined that there were no subsequent events that would require recognition or additional disclosure in the financial statements.

16

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

DISCLOSURE OF FUND EXPENSES

April 30, 2024 (unaudited)

EXAMPLE

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested distributions, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; distribution 12b-1 fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (November 1, 2023 to April 30, 2024).

ACTUAL EXPENSES

The first line of the table below provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during the period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% Hypothetical Example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

17

 

BBH PARTNER FUND – SMALL CAP EQUITY

DISCLOSURE OF FUND EXPENSES (continued)

April 30, 2024 (unaudited)

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

Beginning
Account Value
November 1, 2023

  

Ending
Account Value
April 30, 2024

  

Expenses Paid
During Period
November 1, 2023 to
April 30, 20241

Class I

            

Actual

  

$1,000

  

$1,134

  

$4.93

Hypothetical2

  

$1,000

  

$1,020

  

$4.67

____________

​1   Expenses are equal to the Fund’s annualized net expense ratio of 0.93% for Class I, multiplied by the average account value over the period, multiplied by 182/366.

​2   Assumes a return of 5% before expenses. For the purposes of the calculation, the applicable annualized expense ratio for each class of shares is subtracted from the assumed return before expenses.

18

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

DISCLOSURE OF ADVISOR SELECTION

April 30, 2024 (unaudited)

Investment Advisory and Administrative Services and Sub-Advisory Agreements Approval

The 1940 Act requires that a fund’s investment advisory agreements must be approved both by a fund’s board of trustees and by a majority of the trustees who are not parties to the investment advisory agreements or “interested persons” of any party (“Independent Trustees”), cast in person at a meeting called for the purpose of voting on such approval.

The Board, a majority of which is comprised of Independent Trustees, held a telephonic meeting on November 16, 2023 and an in-person meeting December 12, 2023, in reliance on the Exemptive Relief, to consider whether to renew the combined Amended and Restated Investment Advisory and Administrative Services Agreement (the “Advisory Agreement”) between the Trust and the Investment Adviser with respect to the existing funds in the Trust, including the Fund. At these meetings, the Board also considered the renewal of the sub-advisory agreement (the “Sub-Advisory Agreement” and, together with the Advisory Agreement, the “Agreements”) between the Investment Adviser and Bares Capital Management, Inc. (“Bares Capital” or the “Sub-Adviser”). At the December 12, 2023 meeting, the Board voted to approve the renewal of the Agreements with respect to the Fund for an additional one-year term. In doing so, the Board determined that the terms of the Agreements were fair and reasonable in the best interest of the Fund and its shareholders, and that it had received sufficient information to make an informed business decision with respect to the continuation of the Agreements.

Both in the meetings specifically held to address the continuance of the Agreements and at other meetings over the course of the year, the Board requested, received and assessed a variety of materials provided by the Investment Adviser, Sub-Adviser and BBH, including, among other things, information about the nature, extent and quality of the services provided to the Fund by the Investment Adviser, the Sub-Adviser and BBH, including investment management and administrative, the oversight of Fund service providers, marketing, risk oversight, compliance, and the ability to meet applicable legal and regulatory requirements. The Board also received comparative performance and fee and expense information for the Fund prepared by Broadridge Financial Solutions, Inc. (“Broadridge”) using data from Lipper Inc., an independent provider of investment company data (“Lipper Report”). The Board reviewed this report with Broadridge, Fund Counsel and BBH. The Board received from, and discussed with, counsel to the Trust (“Fund Counsel”) a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements under the 1940 Act, as well as the guidance provided in Gartenberg v. Merrill Lynch Asset Management, Inc., which was affirmed in Jones v. Harris Associates, L.P. In addition, the Board met in executive session outside the presence of Fund management.

In approving the continuation of the Agreements, the Board considered: (a) the nature, extent and quality of services provided by the Investment Adviser and Sub-Adviser; (b) the investment performance of the Fund; (c) the advisory fee and the cost of the services and profits to be realized by the Investment Adviser from its relationship with the Fund; (d) the Fund’s costs to investors compared to the costs of comparative funds and performance compared to the relevant performance of comparative funds; (e) the sharing of potential economies of scale; (f) fall-out benefits to the Investment Adviser as a result of its relationship with the Fund; and (g) other factors deemed relevant by the Board. The following is a summary of the factors the Board considered in making its determination to approve the continuance of the Agreements. No single

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

19

 

BBH PARTNER FUND – SMALL CAP EQUITY

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

factor reviewed by the Board was identified as the principal factor in determining whether to approve the Advisory Agreement, and individual Trustees may have given different weight to various factors. The Board reviewed these factors with Fund Counsel. The Board concluded that the fees paid by the Fund to the Investment Adviser and Bares Capital were reasonable based on the comparative performance, expense information, the cost of the services provided, and the profits realized by the Investment Adviser.

Nature, Extent and Quality of Services

The Board noted that, under the Advisory Agreement and with respect to the Fund, the Investment Adviser, subject to the supervision of the Board, is responsible for providing administrative services and overseeing the investment advisory services provided to the Fund under the same fee structure. Pursuant to the Sub-Advisory Agreement, the Sub-Adviser, subject to the supervision of the Investment Adviser and the Board is responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Fund’s investment objective and policies.

The Board received and considered information during the December 12, 2023 meeting, and over the course of the previous year, regarding the nature, extent and quality of services provided to the Trust and the Fund by the Investment Adviser including: the supervision of the Sub-Adviser, supervision of operations and compliance, and regulatory filings, disclosures to Fund shareholders, general oversight of service providers, organizing Board meetings and preparing the materials for such Board meetings, assisting to the Board (including the Independent Trustees in their capacity as Trustees), legal and Chief Compliance Officer services for the Trust, and other services necessary for the operation of the Fund.

The Board considered the resources of the Investment Adviser and BBH, as a whole, dedicated to the Fund noting that, pursuant to separate agreements, BBH also provides custody and fund accounting services to the Fund. The Board considered the depth and range of services provided pursuant to the Agreement, noting that the Investment Adviser also coordinates the provision of services to the Fund by affiliated and nonaffiliated service providers.

The Board considered the scope and quality of services provided by the Investment Adviser under the Advisory Agreement. The Board also considered the policies and practices followed by BBH and the Investment Adviser. The Board noted that during the course of its regular meetings it received reports on each of the foregoing topics. The Board concluded that, overall, they were satisfied with the nature, extent and quality of the investment advisory and administrative services provided, and expected to be provided, to the Fund pursuant to the Agreements. The Board received and considered information, during the meeting held on December 12, 2023, and over the course of the year, regarding the nature, extent and quality of services provided to the Fund by the Sub-Adviser, particularly portfolio management in light of the narrower scope of services performed by the Sub-Adviser. The Board also considered brokerage policies and practices and the standards applied in seeking best execution. The Board reviewed the qualifications of the key investment personnel primarily responsible for the day-to-day portfolio management of the Fund.

20

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Fund Performance

At the November 16, 2023 and December 12, 2023 meetings, and throughout the year, the Board received and considered performance information for the Fund provided by BBH. The Board considered the Fund’s performance relative to a peer category of other mutual funds in a report compiled by Broadridge. As part of this review, the Trustees considered the composition of the peer category, selection criteria and reputation of Broadridge who prepared the peer category analysis. The Board reviewed and discussed with both BBH and Broadridge, the report’s findings and discussed the positioning of the Fund relative to the selected peer category. The Board considered the investment performance for the Fund over the 1-year period as compared to a select peer category, noting the Fund’s below average performance for the period ended September 30, 2023. In evaluating the performance of the Fund, the Board considered the Fund’s investment strategy, risk expectations for the Fund as well as the level of Fund performance in the context of Fund expenses and Investment Adviser’s profitability.

Costs of Services Provided and Profitability

The Board considered the fee rates paid by the Fund to the Investment Adviser and BBH in light of the nature, extent and quality of the services provided to the Fund. The Board considered the depth and range of services provide pursuant to the Advisory Agreement, noting the Investment Adviser also coordinates the provision of services to the Fund by affiliated and nonaffiliated service providers. The Board received and considered information comparing the Fund’s combined investment advisory and administration fee and the Fund’s net operating expenses with those of other comparable mutual funds, such peer group and comparisons having been selected and calculated by Broadridge, noting that the Fund compared favorably to the selected peer-set. The Board recognized that it is difficult to make comparisons of the fee rate, or of combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds. The Board concluded that the advisory and administration fee appeared to be both reasonable in light of the services rendered and the result of arm’s length negotiations.

The Board also considered the fees paid to the Sub-Adviser for their services to the Fund. The compensation paid to the Sub-Adviser is paid by the Investment Adviser, not the Fund directly, and, accordingly, the retention of the Sub-Adviser does not increase the fees or expenses otherwise incurred by the Fund’s shareholders.

With regard to profitability, the Trustees considered the compensation flowing to the Adviser and BBH, directly or indirectly, and to the Sub-Adviser. The Board reviewed profitability data from October 1, 2022 through September 30, 2023, and the year for both the Investment Adviser and BBH. The data also included the effect of revenue generated by the custody and fund accounting fees paid by the Fund to BBH and corresponding expenses. The Board conducted a detailed review of the expense allocation methods used in preparing the profitability data. The Board focused on profitability of the Investment Adviser and BBH’s relationships with the Fund before taxes and distribution expenses. The Board also reviewed the Sub-Adviser’s profitability data for the Fund. The Board concluded that the Investment Adviser’s and BBH’s profitability was not excessive in light of the nature, extent and quality of services provided to the Fund.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

21

 

BBH PARTNER FUND – SMALL CAP EQUITY

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

The Board also considered the effect of fall-out benefits on the expenses of the Investment Adviser and BBH such as the increased visibility of BBH’s investment management business due to the distribution of the Funds. The Board focused on profitability of the Investment Adviser’s and BBH’s relationships with the Fund before taxes and distribution expenses. The Board concluded that neither the Investment Adviser, BBH, nor the Sub-Adviser’s profitability was excessive in light of the nature, extent and quality of services provided to the Fund. The Board considered other benefits received by BBH and the Investment Adviser, as applicable, as a result of their relationships with the Fund. These other benefits include proprietary research received from brokers that execute the Fund’s purchases and sales of securities and fees received for being the Fund’s administrator, custodian and fund accounting agent. In light of the costs of providing services pursuant to the Advisory Agreement as well as the Investment Adviser and BBH’s commitment to the Fund, the ancillary benefits that the Investment Adviser and BBH received were considered reasonable.

Economies of Scale

The Board also considered the existence of economies of scale and whether those economies are passed along to the Fund’s shareholders through a graduated investment advisory fee schedule or other means, including any fee waivers by the Investment Adviser, and BBH. The Board considered the fee schedule for the Fund on the information they had been provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Fund, there appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints apply. In light of the Fund’s current size and expense structure, the Board concluded that the current breakpoints for the Fund were reasonable. The Board concluded that the fees paid by the Fund to the Investment Adviser, and from the Investment Adviser to the Sub-Adviser, were reasonable based on the comparative performance, expense information, the cost of the services comparative performance, expense information, the cost of the services provided and the profits to be realized by the Investment Adviser.

22

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

CONFLICTS OF INTEREST

April 30, 2024 (unaudited)

BBH&Co., including the Investment Adviser, provides discretionary and non-discretionary investment management services and products to corporations, institutions and individual investors throughout the world. As a result, in the ordinary course of its businesses, BBH&Co., including the Investment Adviser, may engage in activities in which its interests or the interests of its clients may conflict with or be adverse to the interests of the Funds. In addition, certain of such clients (including the Funds) utilize the services of BBH&Co. for which they will pay to BBH&Co. customary fees and expenses that will not be shared with the Funds.

The Investment Adviser and the Sub-advisers have adopted and implemented policies and procedures that seek to manage conflicts of interest. Pursuant to such policies and procedures, the Investment Adviser and each Sub-adviser monitor a variety of areas, including compliance with fund investment guidelines, the investment in only those securities that have been approved for purchase, and compliance with their respective Code of Ethics.

The Trust also manages these conflicts of interest. For example, the Trust has designated a CCO and has adopted and implemented policies and procedures designed to manage the conflicts identified below and other conflicts that may arise in the course of the Funds’ operations in such a way as to safeguard the Funds from being negatively affected as a result of any such potential conflicts. From time to time, the Trustees receive reports from the Investment Adviser, the Sub-advisers and the Trust’s CCO on areas of potential conflict.

Investors should carefully review the following, which describes potential and actual conflicts of interest that BBH&Co., the Investment Adviser and Sub-advisers can face in the operation of their respective investment management services. This section is not, and is not intended to be, a complete enumeration or explanation of all of the potential conflicts of interest that may arise. The Investment Adviser, the Sub-advisers and the Funds has adopted policies and procedures reasonably designed to appropriately prevent, limit or mitigate the conflicts of interest described below. Additional information about potential conflicts of interest regarding the Investment Adviser is set forth in the Investment Adviser’s Form ADV. A copy of Part 1 and Part 2A of the Investment Adviser’s Form ADV is available on the SEC’s website (www.adviserinfo.sec.gov). In addition, many of the activities that create these conflicts of interest are limited and/or prohibited by law, unless an exception is available.

Other Clients and Allocation of Investment Opportunities. BBH&Co., the Investment Adviser, and the Sub-advisers manage funds and accounts of clients other than the Funds (“Other Clients”). In general, BBH&Co., the Investment Adviser, and the Sub-advisers face conflicts of interest when they render investment advisory services to different clients and, from time to time, provide dissimilar investment advice to different clients. Investment decisions will not necessarily be made in parallel among the Funds and Other Clients. Investments made by the Funds do not, and are not intended to, replicate the investments, or the investment methods and strategies, of Other Clients. Accordingly, such Other Clients may produce results that are materially different from those experienced by the Funds. Certain other conflicts of interest may arise in connection with a portfolio manager’s management of the Funds’ investments, on the one hand, and the investments of other funds or accounts for which the portfolio manager is responsible, on the other. For example, it is possible that the various funds or accounts managed

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

23

 

BBH PARTNER FUND – SMALL CAP EQUITY

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

by the Investment Adviser or Sub-advisers could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Funds. From time to time, the Investment Adviser and Sub-advisers, sponsor and with other investment pools and accounts which engage in the same or similar businesses as the Funds using the same or similar investment strategies. To the extent that the same investment opportunities might be desirable for more than one account or fund, possible conflicts could arise in determining how to allocate them because the Investment Adviser or Sub-advisers may have an incentive to allocate investment opportunities to certain accounts or funds. However, BBH&Co. and the Investment Adviser have implemented policies and procedures designed to ensure that information relevant to investment decisions is disseminated promptly within its portfolio management teams and investment opportunities are allocated equitably among different clients. The policies and procedures require, among other things, objective allocation for limited investment opportunities, and documentation and review of justifications for any decisions to make investments only for select accounts or in a manner disproportionate to the size of the account. Nevertheless, access to investment opportunities may be allocated differently among accounts due to the particular characteristics of an account, such as size of the account, cash position, tax status, risk tolerance and investment restrictions or for other reasons.

Actual or potential conflicts of interest may also arise when a portfolio manager has management responsibilities to multiple accounts or funds, resulting in unequal commitment of time and attention to the portfolio management of the funds or accounts.

Affiliated Service Providers. Other potential conflicts might include conflicts between the Funds and its affiliated and unaffiliated service providers (e.g., conflicting duties of loyalty). In addition to providing investment management services through the SID, BBH&Co. provides administrative, custody, shareholder servicing and fund accounting services to the Funds. BBH&Co. may have conflicting duties of loyalty while servicing the Funds and/or opportunities to further its own interest to the detriment of the Funds. For example, in negotiating fee arrangements with affiliated service providers, BBH&Co. may have an incentive to agree to higher fees than it would in the case of unaffiliated providers. BBH&Co. acting in its capacity as the Funds’ administrator is the primary valuation agent of the Funds. BBH&Co. values securities and assets in the Funds according to the Funds’ valuation policies. Because the Investment Adviser’s advisory and administrative fees are calculated by reference to a Funds’ net assets, BBH&Co. and its affiliates may have an incentive to seek to overvalue certain assets.

Aggregation. Potential conflicts of interest also arise with the aggregation of trade orders. Purchases and sales of securities for the Funds may be aggregated with orders for other client accounts managed by the Sub-advisers. The Sub-advisers, however, are not required to aggregate orders if portfolio management decisions for different accounts are made separately, or if it is determined that aggregating is not practicable, or in cases involving client direction. Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds will be charged or credited with the average price. Thus, the effect of the aggregation may operate on some occasions to the disadvantage of the Funds. In addition, under certain circumstances, the Funds will not be charged the same commission or commission equivalent rates in connection with an aggregated order.

24

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Cross Trades. Under certain circumstances, the Investment Adviser, on behalf of the Funds, may seek to buy from or sell securities to another fund or account advised by BBH, the Investment Adviser. Subject to applicable law and regulation, BBH&Co., the Investment Adviser may (but is not required to) effect purchases and sales between BBH&Co., the Investment Adviser clients (“cross trades”), including the Funds, if BBH&Co., the Investment Adviser or a Fund’s Sub-adviser believes such transactions are appropriate based on each party’s investment objectives and guidelines. There may be potential conflicts of interest or regulatory issues relating to these transactions which could limit the Investment Adviser’s decision to engage in these transactions for the Funds. BBH&Co., the Investment Adviser and/or a Fund’s Sub-adviser may have a potentially conflicting division of loyalties and responsibilities to the parties in such transactions.

Soft Dollars. The Investment Adviser may direct brokerage transactions and/or payment of a portion of client commissions (“soft dollars”) to specific brokers or dealers or other providers to pay for research or other appropriate services which provide, in the Investment Adviser’s view, appropriate assistance in the investment decision-making process (including with respect to futures, fixed price offerings and over-the-counter transactions). The use of a broker that provides research and securities transaction services may result in a higher commission than that offered by a broker who does not provide such services. The Investment Adviser will determine in good faith whether the amount of commission is reasonable in relation to the value of research and services provided and whether the services provide lawful and appropriate assistance in its investment decision-making responsibilities.

Research or other services obtained in this manner may be used in servicing any or all of the Funds and other accounts managed by the Investment Adviser, including in connection with accounts that do not pay commissions to the broker related to the research or other service arrangements. Such products and services may disproportionately benefit other client accounts relative to the Funds based on the amount of brokerage commissions paid by the Funds and such other accounts. To the extent that a Sub-adviser uses soft dollars, it will not have to pay for those products and services itself.

BBH&Co. may receive research that is bundled with the trade execution, clearing, and/or settlement services provided by a particular broker-dealer. To the extent that a Sub-adviser receives research on this basis, many of the same conflicts related to traditional soft dollars may exist. For example, the research effectively will be paid by client commissions that also will be used to pay for the execution, clearing, and settlement services provided by the broker-dealer and will not be paid by the Sub-adviser.

Arrangements regarding compensation and delegation of responsibility may create conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades, administration of investment advice and valuation of securities.

Investments in BBH Funds. From time to time BBH&Co. may invest a portion of the assets of its discretionary investment advisory clients in the Funds. That investment by BBH&Co. on behalf of its discretionary investment advisory clients in the Funds may be significant at times.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

25

 

BBH PARTNER FUND – SMALL CAP EQUITY

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of scale that tend to reduce the Funds’ expense ratio. In selecting the Funds for its discretionary investment advisory clients, BBH&Co. may limit its selection to funds managed by BBH&Co. or the Investment Adviser. BBH&Co. may not consider or canvass the universe of unaffiliated investment companies available, even though there may be unaffiliated investment companies that may be more appropriate or that have superior performance. BBH&Co., the Investment Adviser and their affiliates providing services to the Funds benefit from additional fees when the Funds is included as an investment by a discretionary investment advisory client.

BBH&Co. reserves the right to redeem at any time some or all of the shares of the Funds acquired for its discretionary investment advisory clients’ accounts. A large redemption of shares of the Funds by BBH&Co. on behalf of its discretionary investment advisory clients could significantly reduce the asset size of the Funds, which might have an adverse effect on the Funds’ investment flexibility, portfolio diversification and expense ratio.

Valuation. When market quotations are not readily available or are believed by BBH&Co. to be unreliable, the Funds’ investments will be valued at fair value by BBH&Co. pursuant to procedures adopted by the Funds’ Board. When determining an asset’s “fair value,” BBH&Co. seeks to determine the price that a Fund might reasonably expect to receive from the current sale of that asset in an arm’s-length transaction. The price generally may not be determined based on what the Funds might reasonably expect to receive for selling an asset at a later time or if it holds the asset to maturity. While fair value determinations will be based upon all available factors that BBH&Co. deems relevant at the time of the determination and may be based on analytical values determined by BBH&Co. using proprietary or third-party valuation models, fair value represents only a good faith approximation of the value of a security. The fair value of one or more securities may not, in retrospect, be the price at which those assets could have been sold during the period in which the particular fair values were used in determining the Funds’ net asset value. As a result, the Funds’ sale or redemption of its shares at net asset value, at a time when a holding or holdings are valued by BBH&Co. (pursuant to Board-adopted procedures) at fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.

Referral Arrangements. BBH&Co. may enter into advisory and/or referral arrangements with third parties. Such arrangements may include compensation paid by BBH&Co. to the third party. BBH&Co. may pay a solicitation fee for referrals and/or advisory or incentive fees. BBH&Co. may benefit from increased amounts of assets under management.

Personal Trading. BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, face conflicts of interest when transacting in securities for their own accounts because they could benefit by trading in the same securities as the Funds, which could have an adverse effect on the Funds. However, the Investment Adviser has implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policy and procedures are intended to prevent BBH&Co. Partners and employees from trading in the same securities as the Funds. However, BBH&Co., including the Investment Adviser, has implemented

26

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policies and procedures are intended to prevent BBH&Co. Partners and employees with access to Fund material non-public information from trading in the same securities as the Funds.

Gifts and Entertainment. From time to time, employees of BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, may receive gifts and/or entertainment from clients, intermediaries, or service providers to the Funds or BBH&Co., including the Investment Adviser, which could have the appearance of affecting or may potentially affect the judgment of the employees, or the manner in which they conduct business. The Investment Adviser has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees. BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

27

 

BBH PARTNER FUND – SMALL CAP EQUITY

OPERATION AND EFFECTIVNESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM

April 30, 2024 (unaudited)

The Securities and Exchange Commission adopted Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), to promote effective liquidity risk management throughout the open-end investment company industry in order to reduce the risk that funds will be unable to meet their redemption obligations and mitigate dilution of the interests of fund shareholders.

The Board of Trustees (the “Board”) of BBH Trust has appointed three members of the Brown Brothers Harriman & Co. Mutual Fund Advisory Department, the Investment Adviser to the funds of BBH Trust (the “Funds”), as the Program Administrator for each Fund’s liquidity risk management program (the “Program”). The Board met on March 6, 2024 to review the Program for the Funds pursuant to the Liquidity Rule. The Program Administrator provided the Board with a report (the “Report”) that addressed the operations of the Program and assessed its adequacy and effectiveness for the period from February 1, 2023 through January 31, 2024 (the “Reporting Period”).

The Report noted that the Program complied with the key factors for consideration under the Liquidity Rule for assessing, managing and periodically reviewing a Fund’s liquidity risk, including the following points.

Liquidity classification. The Report described the Program’s liquidity classification methodology for categorizing the Funds’ investments into one of four liquidity buckets. The Funds classified each of their investments into one of four liquidity categories based on the number of days reasonably needed to sell and convert a reasonably anticipated sized trade of each investment into cash without significantly impacting the price of the investments. The Program Administrator relied on a third-party data provider to facilitate the classification of each Fund’s investments based on criteria in each Fund’s Program. During the Reporting Period, no Fund held more than 15% of its net assets in illiquid investments.

Highly Liquid Investment Minimum. The Report noted that one aspect of the Liquidity Rule is a requirement that funds that are expected to have less than 50% of assets classified as other than “highly liquid” should establish a minimum percentage of highly liquid assets that the fund is expected to hold on an on-going basis. The Program Administrator monitors the percentages of assets in each category on an ongoing basis and, given that no Fund has approached the 50% threshold, has made the determination that it is not necessary to assign a Highly Liquid Investment Minimum to any of the Funds as provided for in the Liquidity Rule.

The Fund’s investment strategy and liquidity of portfolio investments during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed whether each Fund’s investment strategy is appropriate for an open-end fund structure with a focus on Funds with more significant and consistent holdings of less liquid and illiquid assets and factored a Fund’s concentration in an issuer into the liquidity classification methodology by taking issuer position sizes into account.

Short-term and long-term cash flow projections during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed historical redemption activity and used this information as a component to establish each Fund’s

28

    

 

BBH PARTNER FUND – SMALL CAP EQUITY

OPERATION AND EFFECTIVNESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM
(continued)

April 30, 2024 (unaudited)

reasonably anticipated trading size. The Program Administrator also took into consideration other factors such as shareholder ownership concentration, applicable distribution channels and the degree of certainty associated with a Fund’s short-term and long-term cash flow projections.

Holdings of cash and cash equivalents. The Program Administrator considered the degree to which each Fund held cash and cash equivalents as a component of each Fund’s ability to meet redemption requests.

There were no material changes to the Program during the Reporting Period. The Program Administrator has informed the Board that it believes that the Fund’s Program is adequately designed, has been implemented as intended, and has operated effectively since its implementation. No material exceptions have been noted since the implementation of the Program, and there were no liquidity events that impacted the Fund or its ability to meet redemption requests on a timely basis during the Reporting Period.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

29

 

Administrator
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005

Distributor
Alps Distributors, Inc.
1290 Broadway, Suite 1000
Denver, Co 80203

Shareholder Servicing Agent
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005
1-800-575-1265

To obtain information or make shareholder inquiries:

  

Investment Adviser
Brown Brothers Harriman
Mutual Fund Advisory Department
140 Broadway
New York, NY 10005

By telephone:
By E-mail send your request to:
On the internet:

  

Call 1-800-575-1265
bbhfunds@bbh.com
www.bbhfunds.com

This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund.

For more complete information, visit www.bbhfunds.com for a prospectus. You should consider the Fund’s investment objectives, risks, charges and expenses carefully before you invest. Information about these and other important subjects is in the Fund’s prospectus, which you should read carefully before investing.

Holdings and allocations are subject to change. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities. Current and future holdings are subject to risk.

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Forms N-PORT are available electronically on the SEC’s website (sec.gov). For a complete list of a fund’s portfolio holdings, view the most recent holdings listing, semi-annual report, or annual report on the Fund’s web site at http://www.bbhfunds.com.

A summary of the Fund’s Proxy Voting Policy that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund’s portfolio, as well as a record of how the Fund voted any such proxies during the most recent 12-month period ended June 30, is available, without charge, upon request by calling the toll-free number listed above. This information is also available on the SEC’s website at www.sec.gov.

NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE

 

    

Semi-Annual Report

APRIL 30, 2024

BBH Select Series — Mid cap Fund

 

BBH SELECT SERIES – MID CAP FUND

PORTFOLIO ALLOCATION

April 30, 2024 (unaudited)

SECTOR DIVERSIFICATION

 

U.S. $ Value

  

Percent of
Net Assets

Common Stock:

  

 

      

 

Communications

  

$

8,460,836

  

3.1

%

Consumer Cyclical

  

 

31,631,088

  

11.5

 

Consumer Non-Cyclical

  

 

64,560,270

  

23.5

 

Financials

  

 

30,933,846

  

11.2

 

Industrials

  

 

66,048,752

  

24.0

 

Technology

  

 

69,976,236

  

25.4

 

Cash and Other Assets in Excess of Liabilities

  

 

3,564,494

  

1.3

 

NET ASSETS

  

$

 275,175,522

  

100.0

%

All data as of April 30, 2024. The BBH Select Series – Mid Cap Fund’s (the “Fund”) sector diversification is expressed as a percentage of net assets and may vary over time.

The accompanying notes are an integral part of these financial statements.

2

    

 

BBH SELECT SERIES – MID CAP FUND

PORTFOLIO OF INVESTMENTS

April 30, 2024 (unaudited)

All investments in the United States, except as noted.

Shares

      

Value
   

COMMON STOCK (98.7%)

  

 

  
   

COMMUNICATIONS (3.1%)

  

 

  

32,978

  

Arista Networks, Inc.1

  

$

8,460,836
   

Total Communications

  

 

8,460,836
       

 

  
   

CONSUMER CYCLICAL (11.5%)

  

 

  

948

  

NVR, Inc.1

  

 

7,052,030

37,588

  

Watsco, Inc.

  

 

16,828,899

105,430

  

Wyndham Hotels & Resorts, Inc.

  

 

7,750,159
   

Total Consumer Cyclical

  

 

31,631,088
           

 

  
   

CONSUMER NON-CYCLICAL (23.5%)

      

 

  

121,819

  

AMN Healthcare Services, Inc.1

  

 

7,306,703

72,053

  

Bright Horizons Family Solutions, Inc.1

  

 

7,472,617

166,141

  

Bruker Corp.

  

 

12,960,659

226,950

  

Darling Ingredients, Inc.1

  

 

9,615,871

168,589

  

GXO Logistics, Inc.1

  

 

8,372,130

21,236

  

ICON, Plc. ADR (Ireland)1

  

 

6,325,780

682,750

  

Mister Car Wash, Inc.1

  

 

4,567,597

137,209

  

Shift4 Payments, Inc. (Class A)1

  

 

7,938,913
   

Total Consumer Non-Cyclical

  

 

64,560,270
       

 

  
   

FINANCIALS (11.2%)

  

 

  

188,076

  

Brown & Brown, Inc.

  

 

15,335,717

62,358

  

CBRE Group, Inc. (Class A)1

  

 

5,418,287

37,825

  

LPL Financial Holdings, Inc.

  

 

10,179,842
   

Total Financials

  

 

30,933,846
       

 

  
   

INDUSTRIALS (24.0%)

  

 

  

83,295

  

Advanced Drainage Systems, Inc.

  

 

13,077,315

74,650

  

AptarGroup, Inc.

  

 

10,777,967

137,728

  

Crown Holdings, Inc.

  

 

11,303,337

183,629

  

GFL Environmental, Inc. (Canada)

  

 

5,857,765

62,090

  

HEICO Corp. (Class A)

  

 

10,297,626

59,910

  

Toro Co.

  

 

5,247,517

36,825

  

Vulcan Materials Co.

  

 

9,487,225
   

Total Industrials

  

 

66,048,752

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

3

 

BBH SELECT SERIES – MID CAP FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

All investments in the United States, except as noted.

Shares

      

Value
   

COMMON STOCK (continued)

 

  

 

  
   

TECHNOLOGY (25.4%)

 

  

 

  

44,072

  

Aspen Technology, Inc.1

 

  

$

8,676,455

130,772

  

Entegris, Inc.

 

  

 

17,382,214

45,120

  

Globant S.A. (Luxembourg)1

 

  

 

8,057,981

143,805

  

Guidewire Software, Inc.1

 

  

 

15,876,072

69,054

  

Take-Two Interactive Software, Inc.1

 

  

 

9,861,602

32,178

  

Zebra Technologies Corp. (Class A)1

 

  

 

10,121,912
   

Total Technology

 

  

 

69,976,236
   

Total Common Stock

 

  

 

  
   

(Cost $247,269,634)

 

  

 

271,611,028
         

 

  

 

  

TOTAL INVESTMENTS (Cost $247,269,634)2

  

98.7

%

  

$

271,611,028

CASH AND OTHER ASSETS IN EXCESS OF LIABILITIES

  

1.3

%

  

 

3,564,494

NET ASSETS

  

100.00

%

  

$

275,175,522

____________

​1   Non-income producing security.

​2  The aggregate cost for federal income tax purposes is $247,269,634, the aggregate gross unrealized appreciation is $33,171,783 and the aggregate gross unrealized depreciation is $8,830,389, resulting in net unrealized appreciation of $24,341,394.

Abbreviation:

ADR − American Depositary Receipt.

The accompanying notes are an integral part of these financial statements.

4

    

 

BBH SELECT SERIES – MID CAP FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

FAIR VALUE MEASUREMENTS

The Fund is required to disclose information regarding the fair value measurements of the Fund’s assets and liabilities. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The disclosure requirement established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including for example, the risk inherent in a particular valuation technique used to measure fair value including such a pricing model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the Fund’s own considerations about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

Authoritative guidance establishes three levels of the fair value hierarchy as follows:

— Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities.

— Level 2 – significant other observable inputs (including quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.).

— Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities).

Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. Inputs may include price information, specific and broad credit data, liquidity statistics, and other factors. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires judgment by the investment adviser. The investment adviser considers observable data to be that market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The categorization of a financial instrument within the hierarchy is based upon the pricing transparency of the instrument and does not necessarily correspond to the investment adviser’s perceived risk of that instrument.

Financial assets within Level 1 are based on quoted market prices in active markets. The Fund does not adjust the quoted price for these instruments.

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. These include investment-grade corporate bonds, U.S. Treasury notes and bonds, and certain non-U.S. sovereign obligations, listed equities and over-the-counter derivatives and foreign equity securities whose values could be impacted by events occurring before the Fund’s pricing time, but

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

5

 

BBH SELECT SERIES – MID CAP FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

after the close of the securities’ primary markets and are, therefore, fair valued according to procedures adopted by the Board of Trustees. As Level 2 financial assets include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

Financial assets classified within Level 3 have significant unobservable inputs, as they trade infrequently. Level 3 financial assets include private equity and certain corporate debt securities.

Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon the actual sale of those investments.

The following table summarizes the valuation of the Fund’s investments by the above fair value hierarchy levels as of April 30, 2024.

Investments, at value

  

Unadjusted
Quoted Prices in
Active Markets
for Identical
Investments
(Level 1)

  

Significant
Other
Observable
Inputs
(Level 2)

  

Significant
Unobservable
Inputs
(Level 3)

  

Balance as of
April 30, 2024

Common Stock:

  

 

    

 

    

 

    

 

  

Communications

  

$

8,460,836

  

$

—

  

$

—

  

$

8,460,836

Consumer Cyclical

  

 

31,631,088

  

 

—

  

 

—

  

 

31,631,088

Consumer Non-Cyclical

  

 

64,560,270

  

 

—

  

 

—

  

 

64,560,270

Financials

  

 

30,933,846

  

 

—

  

 

—

  

 

30,933,846

Industrials

  

 

66,048,752

  

 

—

  

 

—

  

 

66,048,752

Technology

  

 

69,976,236

  

 

—

  

 

—

  

 

69,976,236

Total Investments, at value

  

$

271,611,028

  

$

—

  

$

—

  

$

271,611,028

The accompanying notes are an integral part of these financial statements.

6

    

 

BBH SELECT SERIES – MID CAP FUND

STATEMENT OF ASSETS AND LIABILITIES

April 30, 2024 (unaudited)

ASSETS:

  

 

  

Investments in securities, at value (Cost $247,269,634)

  

$

271,611,028

Cash

  

 

4,585,418

Receivables for:

  

 

  

Shares sold

  

 

942,700

Dividends

  

 

43,783

Interest from Custodian

  

 

29,271

Prepaid expenses

  

 

1,069

Total Assets

  

 

277,213,269
   

 

  

LIABILITIES:

  

 

  

Payables for:

  

 

  

Investments purchased

  

 

1,816,868

Investment advisory and administrative fees

  

 

166,657

Professional fees

  

 

34,608

Custody and fund accounting fees

  

 

11,092

Transfer agent fees

  

 

6,535

Board of Trustees’ fees

  

 

367

Shares redeemed

  

 

100

Accrued expenses and other liabilities

  

 

1,520

Total Liabilities

  

 

2,037,747
   

 

  

NET ASSETS

  

$

275,175,522
   

 

  

Net Assets Consist of:

  

 

  

Paid-in capital

  

$

253,761,145

Retained earnings

  

 

21,414,377

Net Assets

  

$

275,175,522
   

 

  

NET ASSET VALUE AND OFFERING PRICE PER SHARE

  

 

  

CLASS I SHARES

  

 

  

($275,175,522 ÷ 25,458,037 shares outstanding)

  

$

10.81

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

7

 

BBH SELECT SERIES – MID CAP FUND

STATEMENT OF OPERATIONS

For the six months ended April 30, 2024 (unaudited)

NET INVESTMENT LOSS:

  

 

  

 

Income:

  

 

  

 

Dividends (net of foreign withholding taxes of $490)

  

$

505,792

 

Interest income from Custodian

  

 

208,647

 

Total Income

  

 

714,439

 
   

 

  

 

Expenses:

  

 

  

 

Investment advisory and administrative fees

  

 

811,910

 

Board of Trustees’ fees

  

 

38,856

 

Professional fees

  

 

30,635

 

Transfer agent fees

  

 

19,873

 

Custody and fund accounting fees

  

 

9,827

 

Miscellaneous expenses

  

 

31,491

 

Total Expenses

  

 

942,592

 

Net Investment Loss

  

 

(228,153

)
   

 

  

 

NET REALIZED AND UNREALIZED GAIN:

  

 

  

 

Net realized gain on investments in securities

  

 

210,398

 

Net change in unrealized appreciation/(depreciation) on investments in securities

  

 

30,380,247

 

Net Realized and Unrealized Gain

  

 

30,590,645

 

Net Increase in Net Assets Resulting from Operations

  

$

30,362,492

 

The accompanying notes are an integral part of these financial statements.

8

    

 

BBH SELECT SERIES – MID CAP FUND

STATEMENTS OF CHANGES IN NET ASSETS
 

For the
six months ended
April 30, 2024
(unaudited)

  

For the
year ended
October 31, 2023

INCREASE/(DECREASE) IN NET ASSETS FROM:

  

 

  

 

  

 

  

 

Operations:

  

 

  

 

  

 

  

 

Net investment income/(loss)

  

$

(228,153

)

  

$

89,911

 

Net realized gain/(loss) on investments in securities

  

 

210,398

 

  

 

(2,636,683

)

Net change in unrealized appreciation/(depreciation) on investments in securities

  

 

30,380,247

 

  

 

(4,643,880

)

Net increase/(decrease) in net assets resulting from operations

  

 

30,362,492

 

  

 

(7,190,652

)
   

 

  

 

  

 

  

 

Dividends and distributions declared:

  

 

  

 

  

 

  

 

Class I

  

 

(190,598

)

  

 

—

 
   

 

  

 

  

 

  

 

Share transactions:

  

 

  

 

  

 

  

 

Proceeds from sales of shares

  

 

117,102,050

 

  

 

142,150,080

 

Net asset value of shares issued to shareholders for reinvestment of dividends and distributions

  

 

4,516

 

  

 

—

 

Cost of shares redeemed

  

 

(12,485,908

)

  

 

(6,673,281

)

Net increase in net assets resulting from share transactions

  

 

104,620,658

 

  

 

135,476,799

 

Total increase in net assets

  

 

134,792,552

 

  

 

128,286,147

 
   

 

  

 

  

 

  

 

NET ASSETS:

  

 

  

 

  

 

  

 

Beginning of period/year

  

 

140,382,970

 

  

 

12,096,823

 

End of period/year

  

$

275,175,522

 

  

$

140,382,970

 

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

9

 

BBH SELECT SERIES – MID CAP FUND

FINANCIAL HIGHLIGHTS

Selected per share data and ratios for a Class I share outstanding throughout each period/year.
 

For the
six months ended
April 30, 2024
(unaudited)

  



For the
years ended
October 31,

  

For the
period from
May 24, 2021
(commencement
of operations) to
October 31, 2021

2023

  

2022

  

Net asset value, beginning of period/year

  

$

8.95

 

  

$

8.85

 

  

$

10.68

 

  

$

10.00

 

Income from investment operations:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Net investment income/(loss)1

  

 

(0.01

)

  

 

0.01

 

  

 

(0.04

)

  

 

(0.02

)

Net realized and unrealized gain/(loss)

  

 

1.88

 

  

 

0.09

 

  

 

(1.79

)

  

 

0.70

 

Total income/(loss) from investment operations

  

 

1.87

 

  

 

0.10

 

  

 

(1.83

)

  

 

0.68

 

Dividends and distributions to shareholders:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

From net investment income

  

 

(0.01

)

  

 

—

 

  

 

—

 

  

 

—

 

Total dividends and distributions to shareholders

  

 

(0.01

)

  

 

—

 

  

 

—

 

  

 

—

 

Net asset value, end of period/year

  

$

10.81

 

  

$

8.95

 

  

$

8.85

 

  

$

10.68

 

Total return2

  

 

20.91

%3

  

 

1.13

%

  

 

(17.13

)%

  

 

6.80

%3
   

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Ratios/Supplemental data:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Net assets, end of period/year (in millions)

  

$

275

 

  

$

140

 

  

$

12

 

  

$

14

 

Ratio of expenses to average net assets before reductions

  

 

0.87

%4

  

 

1.09

%

  

 

2.29

%

  

 

2.46

%5

Fee waiver6

  

 

—

%

  

 

(0.19

)%

  

 

(1.39

)%

  

 

(1.56

)%5

Ratio of expenses to average net assets after reductions

  

 

0.87

%4

  

 

0.90

%

  

 

0.90

%

  

 

0.90

%5

Ratio of net investment income/(loss) to average net assets

  

 

(0.21

)%4

  

 

0.14

%

  

 

(0.38

)%

  

 

(0.40

)%5

Portfolio turnover rate

  

 

2

%3

  

 

7

%

  

 

23

%

  

 

3

%3

____________

​1         Calculated using average shares outstanding for the period/year.

​2         Assumes the reinvestment of distributions.

​3         Not annualized.

​4         Annualized.

​5         Annualized with the exception of audit fees, legal fees and registration fees.

​6    The ratio of expenses to average net assets for the six months ended April 30, 2024, the years ended October 31, 2023, 2022 and the period from May 24, 2021 to October 31, 2021, reflects fees reduced as result of a contractual operating expense limitation of the share class to 0.90%. The Agreement is effective through March 1, 2025 and may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024, the years ended October 31, 2023, 2022 and the period from May 24, 2021 to October 31, 2021, the waived fees were $0, $124,636, $179,874 and $135,159, respectively.

The accompanying notes are an integral part of these financial statements.

10

    

 

BBH SELECT SERIES – MID CAP FUND

NOTES TO FINANCIAL STATEMENTS

April 30, 2024 (unaudited)

1.  Organization. The Fund is a separate, non-diversified series of BBH Trust (the “Trust”), which is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust was originally organized under the laws of the State of Maryland on July 16, 1990 as BBH Fund, Inc. and re-organized as a Delaware statutory trust on June 12, 2007. As of April 30, 2024, there were eight series of the Trust. The Fund commenced operations on May 24, 2021 and offers two share classes, Class I and Retail Class. As of April 30, 2024, Retail Class shares are not available for purchase by investors but may be offered in the future. The investment objective of the Fund is to provide investors with long-term growth of capital. Under normal circumstances, the Fund invests at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in mid cap publicly traded equity securities.

2. Significant Accounting Policies. The Fund’s financial statements are prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”). The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 Financial Services – Investment Companies. The following summarizes significant accounting policies of the Fund:

A. Valuation of Investments. The Board of Trustees (the “Board”) has ultimate responsibility for the supervision and oversight of the determination of the fair value of investments. Pursuant to Rule 2a-5 of the 1940 Act, the Board has designated the Investment Adviser as its valuation designee. The Investment Adviser monitors the continual appropriateness of valuation methods applied and determines if adjustments should be made in light of market factor changes and events affecting issuers. The Investment Adviser performs a series of activities to provide reasonable assurance of the appropriateness of the prices utilized, including but not limited to: periodic independent pricing service due diligence meetings and reviewing the results of back testing on a monthly basis. The Investment Adviser provides the Board with reporting on the results of the back testing as well as positions which were fair valued during the period.

All securities and other investments are recorded at their estimated fair value. The value of investments listed on a securities exchange is based on the last sale price prior to the time when assets are valued, or in the absence of recorded sales, at the most recent bid price on such exchange. If a readily available market quotation is not available or is determined to be unreliable, the investments may be valued utilizing evaluated prices provided by independent pricing services. In establishing such prices, the independent pricing service utilizes both dealer supplied prices and electronic data processing techniques which take into account appropriate factors such as institutional sized trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics, the closure of the primary exchange on which securities trade and before the Fund’s net asset value is next determined and other market data without exclusive reliance on quoted exchange prices or over-the-counter prices since such valuations are believed to reflect more accurately the fair value of such investments. Investments may be fair valued by Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“SID” or

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

11

 

BBH SELECT SERIES – MID CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

“Investment Adviser”) in accordance with the BBH Trust Portfolio Valuation Policy and Procedures using methods that most fairly reflect the amount that the Fund would reasonably expect to receive for the investment on a current sale in its principal market in the ordinary course of business. Short-term investments, which mature in 60 days or less are valued at amortized cost if their original maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if their original maturity when acquired by the Fund was more than 60 days, unless the use of amortized cost is determined not to represent fair value. Any futures contracts held by the Fund are valued daily at the official settlement price of the exchange on which they are traded.

B. Accounting for Investments and Income. Investment transactions are accounted for on the trade date. Realized gains and losses on investment transactions are determined based on the identified cost method. Dividend income and other distributions received from portfolio securities are recorded on the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of securities received at ex-date. Distributions received on securities that represent a return of capital are recorded as a reduction of cost of investments. Distributions received on securities that represent a capital gain are recorded as a realized gain. Interest income is accrued daily. Investment income is recorded net of any foreign taxes withheld where recovery of such tax is uncertain.

C. Fund Expenses. Most expenses of the Trust can be directly attributed to a specific fund. Expenses which cannot be directly attributed to a fund are generally apportioned among each fund in the Trust on a net assets basis or other suitable method. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

D. Federal Income Taxes. It is the Trust’s policy to comply with the requirements of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. The Fund files a tax return annually using tax accounting methods required under provisions of the Code, which may differ from GAAP, which is the basis on which these financial statements are prepared. Accordingly, the amount of net investment income and net realized gain reported in these financial statements may differ from that reported on the Fund’s tax return, due to certain book-to-tax timing differences such as losses deferred due to “wash sale” transactions and utilization of capital loss carryforwards. These differences may result in temporary over-distributions for financial statement purposes and are classified as distributions in excess of accumulated net realized gains or net investment income. These distributions do not constitute a return of capital. Permanent differences are reclassified between paid-in capital and retained earnings/(accumulated deficit) within the Statement of Assets and Liabilities based upon their tax classification. As such, the character of distributions to shareholders reported in the Financial Highlights table may differ from that reported to shareholders on Form 1099-DIV.

 

12

    

 

BBH SELECT SERIES – MID CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

The Fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (“ASC 740”). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The Fund did not have any unrecognized tax benefits as of October 31, 2023, nor were there any increases or decreases in unrecognized tax benefits for the year then ended. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits as an income tax expense in the Statement of Operations. During the six months ended April 30, 2024, the Fund did not incur any such interest or penalties. The Fund is subject to examination by U.S. federal and state tax authorities for returns filed for open tax period since May 24, 2021 (commencement of operations). The Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

E. Dividends and Distributions to Shareholders. Dividends and distributions from net investment income to shareholders, if any, are paid annually and are recorded on the ex-dividend date. Distributions from net capital gains, if any, are generally declared and paid annually and are recorded on the ex-dividend date. The Fund declared dividends and distributions in the amount of $190,598 to Class I shares during the six months ended April 30, 2024.

As of October 31, 2023 and 2022, respectively, the components of retained earnings/(accumulated deficit) on tax basis were as follows:

Components of retained earnings/(accumulated deficit):
       

Undistributed
ordinary
income

  

Undistributed
long-term
capital gain

  

Accumulated
capital and
other losses

  

Other
book/tax
temporary
differences

  

Late Year
Ordinary Loss
Deferral

  

Unrealized
appreciation/
(depreciation)

  

Total
retained
earnings/
(accumulated
deficit)
   

2023:

  

$

 53,937

  

$

       —

  

$

(2,759,699

)

  

$

(12,902)

  

$

       —

  

$

(6,038,853

)

  

$

(8,757,517

)
   

2022:

  

 

—

  

 

—

  

 

(135,918

)

  

 

(35,974)

  

 

—

  

 

(1,394,973

)

  

 

(1,566,865

)

The Fund had $2,759,699 net capital loss carryforwards as of October 31, 2023, of which $1,600,169 and $1,159,530, is attributable to short-term and long-term capital losses, respectively.

The Fund is permitted to carryforward capital losses for an unlimited period and they will retain their character as either short-term or long-term capital losses.

The differences between book-basis and tax-basis unrealized appreciation/(depreciation) would be attributable primarily to the tax deferral of losses on wash sales, if applicable.

To the extent future capital gains are offset by capital loss carryforwards, if any, such gains will not be distributed.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

13

 

BBH SELECT SERIES – MID CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

F.  Use of Estimates. The preparation of the financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increase and decrease in net assets from operations during the reporting period. Actual results could differ from these estimates.

3. Fees and Other Transactions with Affiliates.

A. Investment Advisory and Administrative Fees. Under a combined Investment Advisory and Administrative Services Agreement (“Agreement”) with the Trust, Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“Investment Adviser”) provides investment advisory, portfolio management and administrative services to the Fund. The Fund pays a combined fee for investment advisory and administrative services calculated daily and paid monthly at an annual rate equivalent to 0.75% per annum on the first $3 billion of the Fund’s average daily net assets and 0.70% per annum on the Fund’s average daily net assets over $3 billion. For the six months ended April 30, 2024, the Fund incurred $811,910 under the Agreement.

B. Expense Waivers and Reimbursements. Effective May 24, 2021 (commencement of operations), the Investment Adviser contractually agreed to limit the annual fund operating expenses (excluding interest, taxes, brokerage commissions, other expenditures that are capitalized in accordance with GAAP, other extraordinary expenses not incurred in the ordinary course of the Fund’s business) to 0.90%. The agreement will terminate on March 1, 2025, unless it is renewed by all parties to the agreement. The agreement may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024, the Investment Adviser waived Investment Advisory and Administrative fees in the amount of $0 for Class I.

C. Custody and Fund Accounting Fees. BBH acts as a custodian and fund accountant and receives custody and fund accounting fees from the Fund calculated daily and paid monthly. BBH holds all of the Fund’s cash and investments and calculates the Fund’s daily net asset value. The custody fee is based partially on asset values and partially on individual fund transactions. The fund accounting fee is primarily an asset-based fee calculated at 0.325 basis points per annum of the Fund’s net asset value. For the six months ended April 30, 2024, the Fund incurred $9,827 in custody and fund accounting fees. As per agreement with the Fund’s custodian, the Fund receives interest income on cash balances held by the custodian at the BBH Base Rate. The BBH Base Rate is defined as BBH’s effective trading rate in local money markets on each day. The total interest earned by the Fund for the six months ended April 30, 2024 was $208,647. This amount is included in “Interest income from Custodian” in the Statement of Operations. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to their agreement, the Fund will pay the BBH Overdraft Base Rate plus 2% on the day of the overdraft. The Fund did not incur any such fees during the six months ended April 30, 2024. This amount, if any, is included under line item “Custody and fund accounting fees” in the Statement of Operations.

 

14

    

 

BBH SELECT SERIES – MID CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

D. Board of Trustees’ Fees. Each Trustee who is not an “interested person” as defined under the 1940 Act receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the six months ended April 30, 2024, the Fund incurred $38,856 in independent Trustee compensation and expense reimbursements.

E. Officers of the Trust. Officers of the Trust are also employees of BBH. Officers are paid no fees by the Trust for their services to the Trust.

4.  Investment Transactions. For the six months ended April 30, 2024, the cost of purchases and the proceeds of sales of investment securities, other than short-term investments, were $110,128,124 and $4,105,582, respectively.

5.  Shares of Beneficial Interest. The Trust is permitted to issue an unlimited number of Class I shares of beneficial interest at no par value. Transactions in Class I shares were as follows:

     

For the six months ended
April 30, 2024 (unaudited)

  

For the year ended
October 31, 2023
   

Shares

  

Dollars

  

Shares

  

Dollars

Class I

    

 

  

 

  

 

    

 

  

 

  

 

Shares sold

  

10,910,591

 

  

$

117,102,050

 

  

15,036,110

 

  

$

142,150,080

 

Shares issued in connection with reinvestments of dividends

  

429

 

  

 

4,516

 

  

—

 

  

 

—

 

Shares redeemed

  

(1,138,750

)

  

 

(12,485,908

)

  

(716,784

)

  

 

(6,673,281

)

Net increase

  

9,772,270

 

  

$

104,620,658

 

  

14,319,326

 

  

$

135,476,799

 

6.  Principal Risk Factors and Indemnifications.

A. Principal Risk Factors. Investing in the Fund may involve certain risks, as discussed in the Fund’s prospectus, including but not limited to, those described below:

A shareholder may lose money by investing in the Fund (investment risk). The Fund is actively managed and the decisions by the Investment Adviser may cause the Fund to incur losses or miss profit opportunities (management risk). Price movements may occur due to factors affecting individual companies, such as the issuance of an unfavorable earnings report, or other events affecting particular industries or the equity market as a whole (equity securities risk). Mid cap companies, when compared to larger companies, may experience lower trade volume and could be subject to greater and less predictable price changes (mid cap company risk). The value of securities held by the Fund may fall due to changing economic, political, regulatory or market conditions, or due to a company’s or issuer’s individual situation. Natural disasters, the spread of infectious illness and other public health emergencies, recession, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse effects on world economies and markets generally (market risk). In the normal course of business, the Fund invests in securities and

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

15

 

BBH SELECT SERIES – MID CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

enters into transactions where risks exist due to assumption of large positions in securities of a small number of issuers (non-diversification risk). There are certain risks associated with investing in foreign securities not present in domestic investments, including, but not limited to, recovery of tax withheld by foreign jurisdictions (foreign investment risk). Investments in other investment companies are subject to market and selection risk, as well as the specific risks associated with the investment companies’ portfolio securities (investment in other investment companies risk). Initial public offerings (“IPOs”) are new issues of equity securities, as such they have no trading history and there may be limited information about the companies for a very limited period. Additionally, the prices of securities sold in IPOs may be highly volatile (IPO risk). Preferred securities are subject to issuer-specific and market risks. Generally, issuers only pay dividends after the company makes required payments to holders of bonds and other debt, as such the value of preferred securities may react more strongly to market conditions than bonds and other debts (preferred securities risk). The Fund’s shareholders may be adversely impacted by asset allocation decisions made by an investment adviser whose discretionary clients make up a large percentage of the Fund’s shareholders (large shareholder risk). The Fund may invest in large cap company securities, it may underperform other funds during periods when the Fund’s large cap securities are out of favor (Large Cap Company Risk). Small cap companies may have limited product lines or markets. They may be less financially secure than larger, more established companies and may depend on a more limited management group than larger capitalized companies (Small Cap Company Risk). The extent of the Fund’s exposure to these risks in respect to these financial assets is included in their value as recorded in the Fund’s Statement of Assets and Liabilities.

Please refer to the Fund’s prospectus for a complete description of the principal risks of investing in the Fund.

B. Indemnifications. Under the Trust’s organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the Fund, and shareholders are indemnified against personal liability for the obligations of the Trust. Additionally, in the normal course of business, the Fund enters into agreements with service providers that may contain indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss from such claims is considered remote.

7.  Subsequent Events. Management has evaluated events and transactions that have occurred since April 30, 2024 through the date the financial statements were issued and determined that there were no subsequent events that would require recognition or additional disclosure in the financial statements.

 

16

    

 

BBH SELECT SERIES – MID CAP FUND

DISCLOSURE OF FUND EXPENSES

April 30, 2024 (unaudited)

EXAMPLE

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested distributions, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; distribution 12b-1 fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (November 1, 2023 to April 30, 2024).

ACTUAL EXPENSES

The first line of the table below provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during the period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% Hypothetical Example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

17

 

BBH SELECT SERIES – MID CAP FUND

DISCLOSURE OF FUND EXPENSES (continued)

April 30, 2024 (unaudited)

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

Beginning
Account Value
November 1, 2023

  

Ending
Account Value
April 30, 2024

  

Expenses Paid
During Period
November 1, 2023 to
April 30, 20241

Actual

  

$1,000

  

$1,209

  

$4.78

Hypothetical2

  

$1,000

  

$1,021

  

$4.37

____________

​1   Expenses are equal to the Fund’s annualized net expense ratio of 0.87%, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period).

​2   Assumes a return of 5% before expenses. For the purposes of the calculation, the applicable annualized expense ratio for each class of shares is subtracted from the assumed return before expenses.

 

18

    

 

BBH SELECT SERIES – MID CAP FUND

DISCLOSURE OF ADVISOR SELECTION

April 30, 2024 (unaudited)

Investment Advisory and Administrative Services Agreement Approval

The 1940 Act requires that a fund’s investment advisory agreements must be approved both by a fund’s board of trustees and by a majority of the trustees who are not parties to the investment advisory agreements or “interested persons” of any party (“Independent Trustees”), cast in person at a meeting called for the purpose of voting on such approval.

The Board, a majority of which is comprised of Independent Trustees, held a telephonic meeting on November 16, 2023 and an in-person meeting on December 12, 2023, to consider whether to renew the combined Amended and Restated Investment Advisory and Administrative Services Agreement (the “Advisory Agreement”) between the Trust and the Investment Adviser with respect to the existing funds in the Trust, including the Fund. At the December 12, 2023 meeting, the Board voted to approve the renewal of the Agreement with respect to the Fund for an additional one-year term. In doing so, the Board determined that the terms of the Agreement were fair and reasonable and in the best interest of the Fund and its shareholders and that it had received sufficient information throughout the year to make an informed business decision with respect to the continuation of the Agreement.

Both in the meetings specifically held to address the continuance of the Agreement and at other meetings over the course of the year, the Board requested, received and assessed a variety of materials provided by the Investment Adviser and BBH, including, among other things, information about the nature, extent and quality of the services provided to the Trust and the Fund by the Investment Adviser and BBH, including investment management and administrative the oversight of Fund service providers, marketing, risk oversight, compliance, and the ability to meet applicable legal and regulatory requirements. The Board also received and reviewed third-party comparative fee and expense information for the Fund prepared by Broadridge Financial Solutions, Inc. (“Broadridge”) using data from Lipper Inc., an independent provider of investment company data (“Lipper Report”). The Board reviewed this report with Broadridge, counsel to the Trust (“Fund Counsel”) and BBH. The Board received from, and discussed with, Fund Counsel a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements under the 1940 Act, as well as the guidance provided in Gartenberg v. Merrill Lynch Asset Management, Inc., which was affirmed in Jones v. Harris Associates, L.P. In addition, the Board met in executive session outside the presence of Fund management.

In approving the continuation of the Agreement, the Board considered: (a) the nature, extent and quality of services provided by the Investment Adviser; (b) the investment performance of the Fund; (c) the advisory fee and the cost of the services and profits to be realized by the Investment Adviser from its relationship with the Fund; (d) the Fund’s costs to investors compared to the costs of comparative funds; (e) the sharing of potential economies of scale; (f) fall-out benefits to the Investment Adviser as a result of its relationship with the Fund; and (g) other factors deemed relevant by the Board. The following is a summary of certain factors the Board considered in making its determination to approve the continuance of the Agreement. No single factor reviewed by the Board was identified as the principal factor in determining whether to approve the Agreement, and individual Trustees may have given different weight to various factors. The Board reviewed these factors with Fund Counsel. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the expense information, the cost of the services provided, and the profits realized by the Investment Adviser.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

19

 

BBH SELECT SERIES – MID CAP FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Nature, Extent and Quality of Services

The Board noted that, under the Agreement and with respect to the Fund, the Investment Adviser, subject to the supervision of the Board, is responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Fund’s investment objective and policies. The Board further noted that, as a combined investment advisory and administration agreement, the Agreement also contemplates the provision of administrative services by the Investment Adviser to the Fund within the same fee structure.

The Board received and considered information during the December 12, 2023 meeting, and over the course of the previous year, regarding the nature, extent and quality of services provided to the Trust and the Fund by the Investment Adviser including: portfolio management, the supervision of operations and compliance, preparation of regulatory filings, disclosures to Fund shareholders, general oversight of service providers, organizing Board meetings and preparing the materials for such Board meetings, assistance to the Board (including the Independent Trustees in their capacity as Trustees), legal and Chief Compliance Officer services for the Trust, and other services necessary for the operation of the Fund.

The Board considered the resources of the Investment Adviser and BBH, as a whole, dedicated to the Fund noting that, pursuant to separate agreements, BBH also provides custody and fund accounting services to the Fund. The Board considered the depth and range of services provided pursuant to the Agreement, noting that the Investment Adviser also coordinates the provision of services to the Fund by affiliated and nonaffiliated service providers.

The Board considered the scope and quality of services provided by the Investment Adviser under the Agreement. The Board reviewed the qualifications of the key investment personnel primarily responsible for the day-to-day portfolio management of the Fund. The Board also considered the policies and practices followed by BBH and the Investment Adviser. The Board noted that during the course of its regular meetings, it received reports on each of the foregoing topics. The Board concluded that, overall, it was satisfied with the nature, extent and quality of the investment advisory and administrative services provided, and expected to be provided, to the Fund pursuant to the Agreement.

Fund Performance

At the November 16, 2023 and December 12, 2023 meetings, and throughout the year, the Board received and considered performance information for the Fund provided by BBH. The Board also considered the Fund’s performance relative to a peer category of other mutual funds in a report compiled by Broadridge. As part of this review, the Trustees considered the composition of the peer category, selection criteria and reputation of Broadridge who prepared the peer category analysis. The Board reviewed and discussed with both BBH and Broadridge the report’s findings and discussed the positioning of the Fund relative to its selected peer category. The Board considered investment performance for the Fund over the 1-year period of time, noting the Fund had above average performance as compared to its peer category for the period ended September 30, 2023. In evaluating the performance of the Fund, the Board considered the risk expectations for the Fund as well as level of Fund performance in the context of Fund expenses and the Investment Adviser’s profitability. Based on this information, the Board concluded that it was satisfied with the Fund’s investment results.

 

20

    

 

BBH SELECT SERIES – MID CAP FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Costs of Services Provided and Profitability

The Board considered the fee rates paid by the Fund to the Investment Adviser and BBH in light of the nature, extent and quality of the services provided to the Fund. The Board also considered and reviewed the fee waiver arrangement that was in place for the Fund and considered the actual fee rates after taking into account the contractual fee waiver. The Board noted that they had previously received and considered information comparing the Fund’s combined investment advisory and administration fee and the Fund’s net operating expenses with those of other comparable mutual funds, such peer category and comparisons having been selected and calculated by Broadridge. The Board recognized that it is difficult to make comparisons of the fee rate, or of combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds. The Board concluded that the advisory and administration fee appeared to be both reasonable in light of the services rendered and the result of arm’s length negotiations.

With regard to profitability, the Trustees considered the compensation and benefits flowing to the Investment Adviser and BBH, directly or indirectly. The Board reviewed annualized profitability data for the Fund using data from October 1, 2022 through September 30, 2023, for both the Investment Adviser and BBH. The data also included the effect of revenue generated by the custody and fund accounting fees paid by the Fund to BBH and corresponding expenses. The Board conducted a detailed review of the expense allocation methods used in preparing the profitability data. The Board focused on profitability of the Investment Adviser and BBH’s relationships with the Fund before taxes and distribution expenses. The Board concluded that the Investment Adviser’s and BBH’s profitability was not excessive in light of the nature, extent and quality of services provided to the Fund.

The Board also considered the effect of fall-out benefits to the Investment Adviser and BBH such as the increased visibility of BBH’s investment management business due to the distribution of the Trust’s funds. The Board considered other benefits received by BBH and the Investment Adviser as a result of their relationships with the Fund. These other benefits include fees received for being the Fund’s administrator, custodian and fund accounting agent. In light of the costs of providing services pursuant to the Agreement as well as the Investment Adviser and BBH’s commitment to the Fund, the ancillary benefits that the Investment Adviser and BBH received were considered reasonable.

Economies of Scale

The Board also considered the existence of any economies of scale and whether those economies are passed along to the Fund’s shareholders through a graduated investment advisory fee schedule or other means, including any fee waivers by the Investment Adviser and BBH. The Board considered the fee schedule for the Fund on the information it had been provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Fund, there appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints apply. In light of the Fund’s current size and expense structure, the Board concluded that the current breakpoints for the Fund were reasonable. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the comparative expense information, the cost of the services provided by the Investment Adviser.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

21

 

BBH SELECT SERIES – MID CAP FUND

CONFLICTS OF INTEREST

April 30, 2024 (unaudited)

BBH&Co., including the Investment Adviser, provides discretionary and non-discretionary investment management services and products to corporations, institutions and individual investors throughout the world. As a result, in the ordinary course of its businesses, BBH&Co., including the Investment Adviser, may engage in activities in which its interests or the interests of its clients may conflict with or be adverse to the interests of the Funds. In addition, certain of such clients (including the Funds) utilize the services of BBH&Co. for which they will pay to BBH&Co. customary fees and expenses that will not be shared with the Funds.

The Investment Adviser and the Sub-advisers have adopted and implemented policies and procedures that seek to manage conflicts of interest. Pursuant to such policies and procedures, the Investment Adviser and each Sub-adviser monitor a variety of areas, including compliance with fund investment guidelines, the investment in only those securities that have been approved for purchase, and compliance with their respective Code of Ethics.

The Trust also manages these conflicts of interest. For example, the Trust has designated a CCO and has adopted and implemented policies and procedures designed to manage the conflicts identified below and other conflicts that may arise in the course of the Funds’ operations in such a way as to safeguard the Funds from being negatively affected as a result of any such potential conflicts. From time to time, the Trustees receive reports from the Investment Adviser, the Sub-advisers and the Trust’s CCO on areas of potential conflict.

Investors should carefully review the following, which describes potential and actual conflicts of interest that BBH&Co., the Investment Adviser and Sub-advisers can face in the operation of their respective investment management services. This section is not, and is not intended to be, a complete enumeration or explanation of all of the potential conflicts of interest that may arise. The Investment Adviser, the Sub-advisers and the Funds has adopted policies and procedures reasonably designed to appropriately prevent, limit or mitigate the conflicts of interest described below. Additional information about potential conflicts of interest regarding the Investment Adviser is set forth in the Investment Adviser’s Form ADV. A copy of Part 1 and Part 2A of the Investment Adviser’s Form ADV is available on the SEC’s website (www.adviserinfo.sec.gov). In addition, many of the activities that create these conflicts of interest are limited and/or prohibited by law, unless an exception is available.

Other Clients and Allocation of Investment Opportunities. BBH&Co., the Investment Adviser, and the Sub-advisers manage funds and accounts of clients other than the Funds (“Other Clients”). In general, BBH&Co., the Investment Adviser, and the Sub-advisers face conflicts of interest when they render investment advisory services to different clients and, from time to time, provide dissimilar investment advice to different clients. Investment decisions will not necessarily be made in parallel among the Funds and Other Clients. Investments made by the Funds do not, and are not intended to, replicate the investments, or the investment methods and strategies, of Other Clients. Accordingly, such Other Clients may produce results that are materially different from those experienced by the Funds. Certain other conflicts of interest may arise in connection with a portfolio manager’s management of the Funds’

 

22

    

 

BBH SELECT SERIES – MID CAP FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

investments, on the one hand, and the investments of other funds or accounts for which the portfolio manager is responsible, on the other. For example, it is possible that the various funds or accounts managed by the Investment Adviser or Sub-advisers could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Funds. From time to time, the Investment Adviser and Sub-advisers, sponsor and with other investment pools and accounts which engage in the same or similar businesses as the Funds using the same or similar investment strategies. To the extent that the same investment opportunities might be desirable for more than one account or fund, possible conflicts could arise in determining how to allocate them because the Investment Adviser or Sub-advisers may have an incentive to allocate investment opportunities to certain accounts or funds. However, BBH&Co. and the Investment Adviser have implemented policies and procedures designed to ensure that information relevant to investment decisions is disseminated promptly within its portfolio management teams and investment opportunities are allocated equitably among different clients. The policies and procedures require, among other things, objective allocation for limited investment opportunities, and documentation and review of justifications for any decisions to make investments only for select accounts or in a manner disproportionate to the size of the account. Nevertheless, access to investment opportunities may be allocated differently among accounts due to the particular characteristics of an account, such as size of the account, cash position, tax status, risk tolerance and investment restrictions or for other reasons.

Actual or potential conflicts of interest may also arise when a portfolio manager has management responsibilities to multiple accounts or funds, resulting in unequal commitment of time and attention to the portfolio management of the funds or accounts.

Affiliated Service Providers. Other potential conflicts might include conflicts between the Funds and its affiliated and unaffiliated service providers (e.g., conflicting duties of loyalty). In addition to providing investment management services through the SID, BBH&Co. provides administrative, custody, shareholder servicing and fund accounting services to the Funds. BBH&Co. may have conflicting duties of loyalty while servicing the Funds and/or opportunities to further its own interest to the detriment of the Funds. For example, in negotiating fee arrangements with affiliated service providers, BBH&Co. may have an incentive to agree to higher fees than it would in the case of unaffiliated providers. BBH&Co. acting in its capacity as the Funds’ administrator is the primary valuation agent of the Funds. BBH&Co. values securities and assets in the Funds according to the Funds’ valuation policies. Because the Investment Adviser’s advisory and administrative fees are calculated by reference to a Funds’ net assets, BBH&Co. and its affiliates may have an incentive to seek to overvalue certain assets.

Aggregation. Potential conflicts of interest also arise with the aggregation of trade orders. Purchases and sales of securities for the Funds may be aggregated with orders for other client accounts managed by the Sub-advisers. The Sub-advisers, however, are not required to aggregate orders if portfolio management decisions for different accounts are made separately, or if it is determined that aggregating is not practicable, or in cases involving client direction. Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds will be charged or credited with the

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

23

 

BBH SELECT SERIES – MID CAP FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

average price. Thus, the effect of the aggregation may operate on some occasions to the disadvantage of the Funds. In addition, under certain circumstances, the Funds will not be charged the same commission or commission equivalent rates in connection with an aggregated order.

Cross Trades. Under certain circumstances, the Investment Adviser, on behalf of the Funds, may seek to buy from or sell securities to another fund or account advised by BBH, the Investment Adviser. Subject to applicable law and regulation, BBH&Co., the Investment Adviser may (but is not required to) effect purchases and sales between BBH&Co., the Investment Adviser clients (“cross trades”), including the Funds, if BBH&Co., the Investment Adviser or a Fund’s Sub-adviser believes such transactions are appropriate based on each party’s investment objectives and guidelines. There may be potential conflicts of interest or regulatory issues relating to these transactions which could limit the Investment Adviser’s decision to engage in these transactions for the Funds. BBH&Co., the Investment Adviser and/or a Fund’s Sub-adviser may have a potentially conflicting division of loyalties and responsibilities to the parties in such transactions.

Soft Dollars. The Investment Adviser may direct brokerage transactions and/or payment of a portion of client commissions (“soft dollars”) to specific brokers or dealers or other providers to pay for research or other appropriate services which provide, in the Investment Adviser’s view, appropriate assistance in the investment decision-making process (including with respect to futures, fixed price offerings and over-the-counter transactions). The use of a broker that provides research and securities transaction services may result in a higher commission than that offered by a broker who does not provide such services. The Investment Adviser will determine in good faith whether the amount of commission is reasonable in relation to the value of research and services provided and whether the services provide lawful and appropriate assistance in its investment decision-making responsibilities.

Research or other services obtained in this manner may be used in servicing any or all of the Funds and other accounts managed by the Investment Adviser, including in connection with accounts that do not pay commissions to the broker related to the research or other service arrangements. Such products and services may disproportionately benefit other client accounts relative to the Funds based on the amount of brokerage commissions paid by the Funds and such other accounts. To the extent that a Sub-adviser uses soft dollars, it will not have to pay for those products and services itself.

BBH&Co. may receive research that is bundled with the trade execution, clearing, and/or settlement services provided by a particular broker-dealer. To the extent that a Sub-adviser receives research on this basis, many of the same conflicts related to traditional soft dollars may exist. For example, the research effectively will be paid by client commissions that also will be used to pay for the execution, clearing, and settlement services provided by the broker-dealer and will not be paid by the Sub-adviser.

Arrangements regarding compensation and delegation of responsibility may create conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades, administration of investment advice and valuation of securities.

 

24

    

 

BBH SELECT SERIES – MID CAP FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Investments in BBH Funds. From time to time BBH&Co. may invest a portion of the assets of its discretionary investment advisory clients in the Funds. That investment by BBH&Co. on behalf of its discretionary investment advisory clients in the Funds may be significant at times.

Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of scale that tend to reduce the Funds’ expense ratio. In selecting the Funds for its discretionary investment advisory clients, BBH&Co. may limit its selection to funds managed by BBH&Co. or the Investment Adviser. BBH&Co. may not consider or canvass the universe of unaffiliated investment companies available, even though there may be unaffiliated investment companies that may be more appropriate or that have superior performance. BBH&Co., the Investment Adviser and their affiliates providing services to the Funds benefit from additional fees when the Funds is included as an investment by a discretionary investment advisory client.

BBH&Co. reserves the right to redeem at any time some or all of the shares of the Funds acquired for its discretionary investment advisory clients’ accounts. A large redemption of shares of the Funds by BBH&Co. on behalf of its discretionary investment advisory clients could significantly reduce the asset size of the Funds, which might have an adverse effect on the Funds’ investment flexibility, portfolio diversification and expense ratio.

Valuation. When market quotations are not readily available or are believed by BBH&Co. to be unreliable, the Funds’ investments will be valued at fair value by BBH&Co. pursuant to procedures adopted by the Funds’ Board. When determining an asset’s “fair value,” BBH&Co. seeks to determine the price that a Fund might reasonably expect to receive from the current sale of that asset in an arm’s-length transaction. The price generally may not be determined based on what the Funds might reasonably expect to receive for selling an asset at a later time or if it holds the asset to maturity. While fair value determinations will be based upon all available factors that BBH&Co. deems relevant at the time of the determination and may be based on analytical values determined by BBH&Co. using proprietary or third-party valuation models, fair value represents only a good faith approximation of the value of a security. The fair value of one or more securities may not, in retrospect, be the price at which those assets could have been sold during the period in which the particular fair values were used in determining the Funds’ net asset value. As a result, the Funds’ sale or redemption of its shares at net asset value, at a time when a holding or holdings are valued by BBH&Co. (pursuant to Board-adopted procedures) at fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.

Referral Arrangements. BBH&Co. may enter into advisory and/or referral arrangements with third parties. Such arrangements may include compensation paid by BBH&Co. to the third party. BBH&Co. may pay a solicitation fee for referrals and/or advisory or incentive fees. BBH&Co. may benefit from increased amounts of assets under management.

Personal Trading. BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, face conflicts of interest when transacting in securities for their own accounts because they could benefit by trading in the same securities as the Funds, which could have an adverse effect on the Funds. However, the Investment Adviser has

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

25

 

BBH SELECT SERIES – MID CAP FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policy and procedures are intended to prevent BBH&Co. Partners and employees from trading in the same securities as the Funds. However, BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policies and procedures are intended to prevent BBH&Co. Partners and employees with access to Fund material non-public information from trading in the same securities as the Funds.

Gifts and Entertainment. From time to time, employees of BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, may receive gifts and/or entertainment from clients, intermediaries, or service providers to the Funds or BBH&Co., including the Investment Adviser, which could have the appearance of affecting or may potentially affect the judgment of the employees, or the manner in which they conduct business. The Investment Adviser has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees. BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees.

 

26

    

 

BBH SELECT SERIES – MID CAP FUND

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM

April 30, 2024 (unaudited)

The Securities and Exchange Commission adopted Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), to promote effective liquidity risk management throughout the open-end investment company industry in order to reduce the risk that funds will be unable to meet their redemption obligations and mitigate dilution of the interests of fund shareholders.

The Board of Trustees (the “Board”) of BBH Trust has appointed three members of the Brown Brothers Harriman & Co. Mutual Fund Advisory Department, the Investment Adviser to the funds of BBH Trust (the “Funds”), as the Program Administrator for each Fund’s liquidity risk management program (the “Program”). The Board met on March 6, 2024 to review the Program for the Funds pursuant to the Liquidity Rule. The Program Administrator provided the Board with a report (the “Report”) that addressed the operations of the Program and assessed its adequacy and effectiveness for the period from February 1, 2023 through January 31, 2024 (the “Reporting Period”).

The Report noted that the Program complied with the key factors for consideration under the Liquidity Rule for assessing, managing and periodically reviewing a Fund’s liquidity risk, including the following points.

Liquidity classification. The Report described the Program’s liquidity classification methodology for categorizing the Funds’ investments into one of four liquidity buckets. The Funds classified each of their investments into one of four liquidity categories based on the number of days reasonably needed to sell and convert a reasonably anticipated sized trade of each investment into cash without significantly impacting the price of the investments. The Program Administrator relied on a third-party data provider to facilitate the classification of each Fund’s investments based on criteria in each Fund’s Program. During the Reporting Period, no Fund held more than 15% of its net assets in illiquid investments.

Highly Liquid Investment Minimum. The Report noted that one aspect of the Liquidity Rule is a requirement that funds that are expected to have less than 50% of assets classified as other than “highly liquid” should establish a minimum percentage of highly liquid assets that the fund is expected to hold on an on-going basis. The Program Administrator monitors the percentages of assets in each category on an ongoing basis and, given that no Fund has approached the 50% threshold, has made the determination that it is not necessary to assign a Highly Liquid Investment Minimum to any of the Funds as provided for in the Liquidity Rule.

The Fund’s investment strategy and liquidity of portfolio investments during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed whether each Fund’s investment strategy is appropriate for an open-end fund structure with a focus on Funds with more significant and consistent holdings of less liquid and illiquid assets and factored a Fund’s concentration in an issuer into the liquidity classification methodology by taking issuer position sizes into account.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

27

 

BBH SELECT SERIES – MID CAP FUND

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM (continued)

April 30, 2024 (unaudited)

Short-term and long-term cash flow projections during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed historical redemption activity and used this information as a component to establish each Fund’s reasonably anticipated trading size. The Program Administrator also took into consideration other factors such as shareholder ownership concentration, applicable distribution channels and the degree of certainty associated with a Fund’s short-term and long-term cash flow projections.

Holdings of cash and cash equivalents. The Program Administrator considered the degree to which each Fund held cash and cash equivalents as a component of each Fund’s ability to meet redemption requests.

There were no material changes to the Program during the Reporting Period. The Program Administrator has informed the Board that it believes that the Fund’s Program is adequately designed, has been implemented as intended, and has operated effectively since its implementation. No material exceptions have been noted since the implementation of the Program, and there were no liquidity events that impacted the Fund or its ability to meet redemption requests on a timely basis during the Reporting Period.

 

28

    

 

Administrator
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005

Distributor
Alps Distributors, Inc.
1290 Broadway, Suite 1000
Denver, Co 80203

Shareholder Servicing Agent
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005
1-800-575-1265

To obtain information or make shareholder inquiries:

  

Investment Adviser
Brown Brothers Harriman
Mutual Fund Advisory Department
140 Broadway
New York, NY 10005

By telephone:
By E-mail send your request to:
On the internet:

  

Call 1-800-575-1265
bbhfunds@bbh.com
www.bbhfunds.com

This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund.

For more complete information, visit www.bbhfunds.com for a prospectus. You should consider the Fund’s investment objectives, risks, charges and expenses carefully before you invest. Information about these and other important subjects is in the Fund’s prospectus, which you should read carefully before investing.

Holdings and allocations are subject to change. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities. Current and future holdings are subject to risk.

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Forms N-PORT are available electronically on the SEC’s website (sec.gov). For a complete list of a fund’s portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on the Fund’s web site at http://www.bbhfunds.com.

A summary of the Fund’s Proxy Voting Policy that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund’s portfolio, as well as a record of how the Fund voted any such proxies during the most recent 12-month period ended June 30, is available, without charge, upon request by calling the toll-free number listed above. This information is also available on the SEC’s website at www.sec.gov.

NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE

 

    

Semi-Annual Report

APRIL 30, 2024

BBH Partner Fund — International Equity

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO ALLOCATION

April 30, 2024 (unaudited)

COUNTRY DIVERSIFICATION

 

U.S. $ Value

  

Percent of
Net Assets

Common Stock:

  

 

          

 

    

Canada

  

$

 158,025,601

      

7.6

%

    

Cayman Islands

  

 

8,750,034

      

0.4

 

    

Denmark

  

 

29,906,791

      

1.4

 

    

Finland

  

 

26,497,804

      

1.3

 

    

France

  

 

345,506,441

      

16.7

 

    

Germany

  

 

173,499,461

      

8.4

 

    

Hong Kong

  

 

24,427,946

      

1.2

 

    

India

  

 

26,881,920

      

1.3

 

    

Ireland

  

 

180,373,013

      

8.8

 

    

Japan

  

 

217,602,954

      

10.5

 

    

Jersey

  

 

47,065,063

      

2.3

 

    

Luxembourg

  

 

12,654,575

      

0.6

 

    

Netherlands

  

 

126,387,480

      

6.1

 

    

Singapore

  

 

29,272,214

      

1.4

 

    

South Korea

  

 

52,325,507

      

2.5

 

    

Spain

  

 

29,745,492

      

1.4

 

    

Sweden

  

 

42,916,365

      

2.1

 

    

Switzerland

  

 

94,152,410

      

4.5

 

    

Taiwan

  

 

98,225,936

      

4.7

 

    

United Kingdom

  

 

213,178,631

      

10.3

 

    

United States

  

 

43,562,593

      

2.1

 

    

Registered Investment Companies:

  

 

          

 

    

United States

  

 

32,400,000

      

1.6

 

    

Preferred Stocks:

  

 

          

 

    

Germany

  

 

16,910,633

      

0.8

 

    

Warrants:

  

 

          

 

    

Canada

  

 

0

      

0.0

 

    

Cash and Other Assets in Excess of Liabilities

  

 

40,436,862

      

 2.0

 

    

NET ASSETS

  

$

2,070,705,726

      

100.0

%

    

All data as of April 30, 2024. BBH Partner Fund – International Equity’s (the “Fund”) country diversification is expressed as a percentage of net assets and may vary over time. The Fund’s country diversification is derived from respective security’s country of incorporation.

The accompanying notes are an integral part of these financial statements.

2

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO ALLOCATION (continued)

April 30, 2024 (unaudited)

SECTOR DIVERSIFICATION

 

U.S. $ Value

  

Percent of
Net Assets

Common Stock:

  

 

          

 

    

Basic Materials

  

$

     58,459,636

      

2.8

%

    

Communications

  

 

65,455,149

      

3.2

 

    

Consumer Cyclical

  

 

318,838,884

      

15.4

 

    

Consumer Non-Cyclical

  

 

344,373,563

      

16.6

 

    

Energy

  

 

29,906,791

      

1.4

 

    

Financials

  

 

289,207,078

      

14.0

 

    

Industrials

  

 

501,889,964

      

24.2

 

    

Technology

  

 

372,827,166

      

18.0

 

    

Registered Investment Companies

  

 

32,400,000

      

1.6

 

    

Preferred Stocks:

  

 

          

 

    

Consumer Cyclical

  

 

16,910,633

      

0.8

 

    

Warrants:

  

 

          

 

    

Technology

  

 

0

      

0.0

 

    

Cash and Other Assets in Excess of Liabilities

  

 

40,436,862

      

 2.0 

 

    

NET ASSETS

  

$

2,070,705,726

      

100.0

%

    

All data as of April 30, 2024. The Fund’s sector diversification is expressed as a percentage of net assets and may vary over time.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

3

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO OF INVESTMENTS

April 30, 2024 (unaudited)

Shares/
Units

      

Value
   

COMMON STOCK (95.6%)

  

 

  
   

CANADA (7.6%)

  

 

  
   

BASIC MATERIALS

  

 

  

175,600

  

Franco-Nevada Corp.

  

$

21,165,490
   

COMMUNICATIONS

  

 

  

177,852

  

Shopify, Inc. (Class A)1

  

 

12,485,210
   

CONSUMER CYCLICAL

  

 

  

457,070

  

Alimentation Couche-Tard, Inc.

  

 

25,365,075
   

FINANCIALS

  

 

  

1,596,103

  

Brookfield Corp.

  

 

64,104,159
   

INDUSTRIALS

  

 

  

197,516

  

Canadian Pacific Kansas City, Ltd.

  

 

15,515,112
   

TECHNOLOGY

  

 

  

7,522

  

Constellation Software, Inc.

  

 

19,390,555
   

Total Canada

  

 

158,025,601
   

CAYMAN ISLANDS (0.4%)

  

 

  
   

COMMUNICATIONS

  

 

  

603,355

  

JD.com, Inc. (Class A)

  

 

8,750,034
   

Total Cayman Islands

  

 

8,750,034
   

DENMARK (1.4%)

  

 

  
   

ENERGY

  

 

  

1,113,964

  

Vestas Wind Systems A/S1

  

 

29,906,791
   

Total Denmark

  

 

29,906,791
   

FINLAND (1.3%)

  

 

  
   

INDUSTRIALS

  

 

  

543,110

  

Kone Oyj (Class B)

  

 

26,497,804
   

Total Finland

  

 

26,497,804
   

FRANCE (16.7%)

  

 

  
   

CONSUMER CYCLICAL

  

 

  

44,609

  

Kering S.A.

  

 

15,413,338

21,681

  

LVMH Moet Hennessy Louis Vuitton SE

  

 

17,473,949
       

 

32,887,287
   

CONSUMER NON-CYCLICAL

  

 

  

14,948

  

L’Oreal S.A.

  

 

6,991,109

172,808

  

Sartorius Stedim Biotech

  

 

37,364,259
       

 

44,355,368
   

INDUSTRIALS

  

 

  

392,581

  

Safran S.A.

  

 

84,992,251

189,666

  

Schneider Electric SE

  

 

43,247,866

352,868

  

Thales S.A.

  

 

59,422,186
       

 

187,662,303

The accompanying notes are an integral part of these financial statements.

4

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Shares/
Units

      

Value
   

COMMON STOCK (continued)

  

 

  
   

FRANCE (continued)

  

 

  
   

TECHNOLOGY

  

 

  

261,070

  

Capgemini SE

  

$

54,916,522

655,003

  

Dassault Systemes SE

  

 

25,684,961
       

 

80,601,483
   

Total France

  

 

345,506,441
   

GERMANY (8.4%)

  

 

  
   

CONSUMER CYCLICAL

  

 

  

224,054

  

Adidas AG

  

 

54,125,693
   

FINANCIALS

  

 

  

149,007

  

Deutsche Boerse AG

  

 

28,800,628
   

INDUSTRIALS

  

 

  

68,043

  

Rheinmetall AG

  

 

37,584,732
   

TECHNOLOGY

  

 

  

292,302

  

SAP SE

  

 

52,988,408
   

Total Germany

  

 

173,499,461
   

HONG KONG (1.2%)

  

 

  
   

CONSUMER CYCLICAL

  

 

  

2,430,000

  

Galaxy Entertainment Group, Ltd.

  

 

10,922,862
   

FINANCIALS

  

 

  

1,841,300

  

AIA Group, Ltd.

  

 

13,505,084
   

Total Hong Kong

  

 

24,427,946
   

INDIA (1.3%)

  

 

  
   

FINANCIALS

  

 

  

466,700

  

HDFC Bank, Ltd. ADR

  

 

26,881,920
   

Total India

  

 

26,881,920
   

IRELAND (8.8%)

  

 

  
   

BASIC MATERIALS

  

 

  

604,271

  

Smurfit Kappa Group, Plc.

  

 

26,286,486
   

CONSUMER CYCLICAL

  

 

  

230,200

  

Ryanair Holdings, Plc. ADR

  

 

31,353,240
   

CONSUMER NON-CYCLICAL

  

 

  

115,574

  

ICON, Plc. ADR1

  

 

34,427,183
   

INDUSTRIALS

  

 

  

1,140,611

  

CRH, Plc.

  

 

88,306,104
   

Total Ireland

  

 

180,373,013
   

JAPAN (10.5%)

  

 

  
   

CONSUMER CYCLICAL

  

 

  

378,200

  

Nintendo Co., Ltd.

  

 

18,453,942

278,500

  

Sony Group Corp.

  

 

23,033,928

2,252,000

  

Suzuki Motor Corp.

  

 

26,232,380
       

 

67,720,250

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

5

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Shares/
Units

      

Value
   

COMMON STOCK (continued)

  

 

  
   

JAPAN (continued)

  

 

  
   

CONSUMER NON-CYCLICAL

  

 

  

465,800

  

Eisai Co., Ltd

  

$

19,197,850

494,515

  

Recruit Holdings Co., Ltd.

  

 

21,519,645
       

 

40,717,495
   

INDUSTRIALS

  

 

  

117,900

  

Daikin Industries, Ltd.

  

 

16,021,561

50,648

  

Keyence Corp.

  

 

22,463,331

938,400

  

Komatsu, Ltd.

  

 

28,118,191
       

 

66,603,083
   

TECHNOLOGY

  

 

  

329,665

  

Obic Co., Ltd.

  

 

42,562,126
   

Total Japan

  

 

217,602,954
   

JERSEY (2.3%)

  

 

  
   

CONSUMER NON-CYCLICAL

  

 

  

1,165,070

  

Experian, Plc.

  

 

47,065,063
   

Total Jersey

  

 

47,065,063
   

LUXEMBOURG (0.6%)

  

 

  
   

COMMUNICATIONS

  

 

  

45,124

  

Spotify Technology S.A.1

  

 

12,654,575
   

Total Luxembourg

  

 

12,654,575
   

NETHERLANDS (6.1%)

  

 

  
   

COMMUNICATIONS

  

 

  

939,073

  

Prosus NV1

  

 

31,565,330
   

CONSUMER CYCLICAL

  

 

  

1,279,801

  

Universal Music Group NV

  

 

37,639,678
   

CONSUMER NON-CYCLICAL

  

 

  

72,755

  

Heineken NV

  

 

7,092,023
   

TECHNOLOGY

  

 

  

30,460

  

ASML Holding NV

  

 

26,581,970

594,637

  

STMicroelectronics NV

  

 

23,508,479
       

 

50,090,449
   

Total Netherlands

  

 

126,387,480
   

SINGAPORE (1.4%)

  

 

  
   

FINANCIALS

  

 

  

1,143,560

  

DBS Group Holdings, Ltd.

  

 

29,272,214
   

Total Singapore

  

 

29,272,214
   

SOUTH KOREA (2.5%)

  

 

  
   

FINANCIALS

  

 

  

431,869

  

KB Financial Group, Inc.

  

 

23,357,298

The accompanying notes are an integral part of these financial statements.

6

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Shares/
Units

      

Value
   

COMMON STOCK (continued)

  

 

  
   

SOUTH KOREA (continued)

  

 

  
   

TECHNOLOGY

  

 

  

524,416

  

Samsung Electronics Co., Ltd.

  

$

28,968,209
   

Total South Korea

  

 

52,325,507
   

SPAIN (1.4%)

  

 

  
   

CONSUMER NON-CYCLICAL

  

 

  

468,238

  

Amadeus IT Group S.A.

  

 

29,745,492
   

Total Spain

  

 

29,745,492
   

SWEDEN (2.1%)

  

 

  
   

CONSUMER NON-CYCLICAL

  

 

  

980,498

  

Essity AB (Class B)

  

 

24,473,982
   

FINANCIALS

  

 

  

2,106,765

  

Svenska Handelsbanken AB (Class A)

  

 

18,442,383
   

Total Sweden

  

 

42,916,365
   

SWITZERLAND (4.5%)

  

 

  
   

BASIC MATERIALS

  

 

  

98,200

  

DSM-Firmenich AG

  

 

11,007,660
   

CONSUMER CYCLICAL

  

 

  

96,665

  

Cie Financiere Richemont S.A. (Class A)

  

 

13,404,445
   

CONSUMER NON-CYCLICAL

  

 

  

501,638

  

Alcon, Inc.

  

 

38,599,794

78,692

  

Sonova Holding AG

  

 

21,872,650
       

 

60,472,444
   

FINANCIALS

  

 

  

7,213

  

Partners Group Holding AG

  

 

9,267,861
   

Total Switzerland

  

 

94,152,410
   

TAIWAN (4.7%)

  

 

  
   

TECHNOLOGY

  

 

  

366,004

  

MediaTek, Inc.

  

 

11,072,169

634,584

  

Taiwan Semiconductor Manufacturing Co., Ltd. ADR

  

 

87,153,767
   

Total Taiwan

  

 

98,225,936
   

UNITED KINGDOM (10.3%)

  

 

  
   

CONSUMER CYCLICAL

  

 

  

681,859

  

Compass Group, Plc.

  

 

18,973,877

235,556

  

Next, Plc.

  

 

26,446,477
       

 

45,420,354
   

CONSUMER NON-CYCLICAL

  

 

  

106,389

  

Reckitt Benckiser Group, Plc.

  

 

5,942,777

1,284,788

  

Rentokil Initial, Plc.

  

 

6,519,143
       

 

12,461,920

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

7

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Shares/
Units

      

Value
   

COMMON STOCK (continued)

  

 

  
   

UNITED KINGDOM (continued)

  

 

  
   

FINANCIALS

  

 

  

684,995

  

London Stock Exchange Group, Plc.

  

$

75,575,531
   

INDUSTRIALS

  

 

  

3,796,837

  

BAE Systems, Plc.

  

 

63,234,145

2,102,095

  

Melrose Industries, Plc.

  

 

16,486,681
       

 

79,720,826
   

Total United Kingdom

  

 

213,178,631
   

UNITED STATES (2.1%)

  

 

  
   

CONSUMER NON-CYCLICAL

  

 

  

264,361

  

Revvity, Inc.

  

 

27,089,072

39,616

  

S&P Global, Inc.

  

 

16,473,521
   

Total United States

  

 

43,562,593
   

Total Common Stock (Cost $1,604,490,443)

  

 

1,980,958,231
   

REGISTERED INVESTMENT COMPANIES (1.6%)

  

 

  
   

UNITED STATES (1.6%)

  

 

  

32,400,000

  

Morgan Stanley Institutional Liquidity Funds – Treasury Securities Portfolio, Institutional Share Class.

  

 

32,400,000
   

Total United States

  

 

32,400,000
   

Total Registered Investment Companies (Cost $32,400,000)

  

 

32,400,000
   

PREFERRED STOCKS (0.8%)

  

 

  
   

GERMANY (0.8%)

  

 

  
   

CONSUMER CYCLICAL

  

 

  

189,570

  

Dr Ing hc F Porsche AG (Class Preference)2

  

 

16,910,633
   

Total Germany

  

 

16,910,633
   

Total Preferred Stocks (Cost $18,873,326)

  

 

16,910,633

The accompanying notes are an integral part of these financial statements.

8

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Shares/
Units

      

Value
   

WARRANTS (0.0%)

  

 

  
   

CANADA (0.0%)

  

 

  

18,143

  

Constellation Software Inc., expires 03/31/20401,3

  

$

0
   

Total Canada

  

 

0
   

Total Warrants (Cost $0)

  

 

0

TOTAL INVESTMENTS (Cost $1,655,763,769)4

  

98.0

%

      

$

2,030,268,864

CASH AND OTHER ASSETS IN EXCESS OF LIABILITIES

  

2.0

%

      

 

40,436,862

NET ASSETS

  

100.00

%

      

$

2,070,705,726

____________

​1   Non-income producing security.

​2  Security exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. Total market value of Rule 144A securities owned at April 30, 2024 was $16,910,633 or 0.8% of net assets.

​3  Security that used significant unobservable inputs to determine fair value.

​4  The aggregate cost of investments and derivatives for federal income tax purposes is $1,655,763,769, the aggregate gross unrealized appreciation is $469,517,563 and the aggregate gross unrealized depreciation is $95,012,468, resulting in net unrealized appreciation of $374,505,095.

The Fund’s country diversification is based on the respective security’s country of incorporation.

Abbreviation:

ADR – American Depositary Receipt.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

9

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Fair Value Measurements

The Fund is required to disclose information regarding the fair value measurements of the Fund’s assets and liabilities. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The disclosure requirement established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including, for example, the risk inherent in a particular valuation technique used to measure fair value, including the model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the Fund’s own considerations about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

Authoritative guidance establishes three levels of the fair value hierarchy as follows:

— Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities.

— Level 2 – significant other observable inputs (including quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.).

— Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities).

Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. Inputs may include price information, specific and broad credit data, liquidity statistics, and other factors. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires judgment by the investment adviser. The investment adviser considers observable data to be that market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The categorization of a financial instrument within the hierarchy is based upon the pricing transparency of the instrument and does not necessarily correspond to the investment adviser’s perceived risk of that instrument.

Financial assets within Level 1 are based on quoted market prices in active markets. The Fund does not adjust the quoted price for these instruments.

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. These include investment-grade corporate bonds, U.S. Treasury notes and bonds, and certain non-U.S. sovereign obligations and over-the-counter derivatives and foreign equity securities whose values could be impacted by events occurring before the Fund’s pricing time, but after the close of the securities’

The accompanying notes are an integral part of these financial statements.

10

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

primary markets and are, therefore, fair valued according to procedures adopted by the Board of Trustees. As Level 2 financial assets include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

Financial assets classified within Level 3 have significant unobservable inputs, as they trade infrequently. Level 3 financial assets include private equity and certain corporate debt securities.

Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon the actual sale of those investments.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

11

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

The following table summarizes the valuation of the Fund’s investments by the above fair value hierarchy levels as of April 30, 2024.

Investments, at value

  

Unadjusted
Quoted Prices in
Active Markets
for Identical
Investments
(Level 1)

  

Significant
Other
Observable
Inputs
(Level 2)

  

Significant
Unobservable
Inputs
(Level 3)

  

Balance as of
April 30, 2024

Common Stock:

  

 

    

 

    

 

    

 

  

Canada

  

$

158,025,601

  

$

–

  

$

—

  

$

158,025,601

Cayman Islands

  

 

—

  

 

8,750,034

  

 

—

  

 

8,750,034

Denmark

  

 

—

  

 

29,906,791

  

 

—

  

 

29,906,791

Finland

  

 

—

  

 

26,497,804

  

 

—

  

 

26,497,804

France

  

 

—

  

 

345,506,441

  

 

—

  

 

345,506,441

Germany

  

 

—

  

 

173,499,460

  

 

—

  

 

173,499,460

Hong Kong

  

 

—

  

 

24,427,946

  

 

—

  

 

24,427,946

India

  

 

26,881,920

  

 

—

  

 

—

  

 

26,881,920

Ireland

  

 

154,086,527

  

 

26,286,486

  

 

—

  

 

180,373,013

Japan

  

 

—

  

 

217,602,955

  

 

—

  

 

217,602,955

Jersey

  

 

—

  

 

47,065,063

  

 

—

  

 

47,065,063

Luxembourg

  

 

12,654,575

  

 

—

  

 

—

  

 

12,654,575

Netherlands

  

 

—

  

 

126,387,480

  

 

—

  

 

126,387,480

Singapore

  

 

—

  

 

29,272,214

  

 

—

  

 

29,272,214

South Korea

  

 

—

  

 

52,325,507

  

 

—

  

 

52,325,507

Spain

  

 

—

  

 

29,745,492

  

 

—

  

 

29,745,492

Sweden

  

 

—

  

 

42,916,365

  

 

—

  

 

42,916,365

Switzerland

  

 

—

  

 

94,152,410

  

 

—

  

 

94,152,410

Taiwan

  

 

87,153,767

  

 

11,072,169

  

 

—

  

 

98,225,936

United Kingdom

  

 

—

  

 

213,178,631

  

 

—

  

 

213,178,631

United States

  

 

43,562,593

  

 

—

  

 

—

  

 

43,562,593

Registered Investment Companies:

  

 

    

 

    

 

    

 

  

United States

  

 

32,400,000

  

 

—

  

 

—

  

 

32,400,000

Preferred Stocks:

  

 

    

 

    

 

    

 

  

Germany

  

 

—

  

 

16,910,633

  

 

—

  

 

16,910,633

Warrants:

  

 

    

 

    

 

    

 

  

Canada

  

 

—

  

 

—

  

 

0

  

 

0

Total Investments, at value

  

$

514,764,983

  

$

1,515,503,881

  

$

0

  

$

2,030,268,864

The accompanying notes are an integral part of these financial statements.

12

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

The following is a reconciliation of assets for which significant unobservable inputs (Level 3) were used in determining fair value during the period ended April 30, 2024:

 

Warrants

Balance as of October 31, 2023

  

$

0

Purchases

  

 

—

Sales/Paydowns

  

 

—

Realized gains/(losses)

  

 

—

Change in unrealized appreciation/(depreciation)

  

 

—

Amortization

  

 

—

Transfers from Level 3

  

 

—

Transfers to Level 3

  

 

0

Balance as of April 30, 2024

  

$

0

The Fund investment classified as Level 3 was deemed to have no value as of April 30, 2024.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

13

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

STATEMENT OF ASSETS AND LIABILITIES

April 30, 2024 (unaudited)

ASSETS:

  

 

  

Investments in securities, at value (Cost $1,655,763,769)

  

$

2,030,268,864

Cash

  

 

42,756,255

Foreign currency at value (Cost $7,424)

  

 

8,956

Receivables for:

  

 

  

Dividends

  

 

6,610,735

Investments sold

  

 

2,533,725

Shares sold

  

 

736,100

Interest from Custodian

  

 

78,575

Prepaid expenses

  

 

13,765

Total Assets

  

 

2,083,006,975

LIABILITIES:

  

 

  

Payables for:

  

 

  

Investments purchased

  

 

10,796,449

Investment advisory and administrative fees

  

 

1,040,048

Shares redeemed

  

 

215,900

Custody and fund accounting fees

  

 

176,546

Professional fees

  

 

52,956

Transfer agent fees

  

 

6,725

Board of Trustees’ fees

  

 

547

Accrued expenses and other liabilities

  

 

12,078

Total Liabilities

  

 

12,301,249

NET ASSETS

  

$

2,070,705,726
   

 

  

Net Assets Consist of:

  

 

  

Paid-in capital

  

$

2,029,578,083

Retained earnings

  

 

41,127,643

Net Assets

  

$

2,070,705,726
   

 

  

NET ASSET VALUE AND OFFERING PRICE PER SHARE

  

 

  

CLASS I SHARES

  

 

  

($2,070,705,726 ÷ 130,335,337 shares outstanding)

  

$

15.89

The accompanying notes are an integral part of these financial statements.

14

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

STATEMENT OF OPERATIONS

For the six months ended April 30, 2024 (unaudited)

NET INVESTMENT INCOME:

  

 

  

Income:

  

 

  

Dividends (net of foreign withholding taxes of $1,511,224)

  

$

  15,676,462

Interest income

  

 

6,614

Interest income from Custodian

  

 

492,007

Other income

  

 

30,480

Total Income

  

 

16,205,563
   

 

  

Expenses:

  

 

  

Investment advisory and administrative fees

  

 

6,238,227

Custody and fund accounting fees

  

 

141,236

Board of Trustees’ fees

  

 

48,967

Professional fees

  

 

38,377

Transfer agent fees

  

 

20,538

Miscellaneous expenses

  

 

40,399

Total Expenses

  

 

6,527,744

Net Investment Income

  

 

9,677,819
   

 

  

NET REALIZED AND UNREALIZED GAIN:

  

 

  

Net realized gain on investments in securities

  

 

70,725,756

Net realized gain on foreign exchange translations

  

 

57,712

Net realized gain on investments in securities and foreign exchange translations

  

 

70,783,468

Net change in unrealized appreciation/(depreciation) on investments in securities

  

 

298,984,170

Net change in unrealized appreciation/(depreciation) on foreign currency transactions and translations

  

 

(78,138)

Net change in unrealized appreciation/(depreciation) on investments in securities, foreign currency transactions and translations

  

 

298,906,032

Net Realized and Unrealized Gain

  

 

369,689,500

Net Increase in Net Assets Resulting from Operations

  

$

379,367,319

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

15

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

STATEMENTS OF CHANGES IN NET ASSETS
 

For the
six months ended
April 30, 2024
(unaudited)

  

For the
year ended
October 31, 2023

INCREASE/(DECREASE) IN NET ASSETS FROM:

  

 

  

 

  

 

  

 

Operations:

  

 

  

 

  

 

  

 

Net investment income

  

$

9,677,819

 

  

$

18,135,247

 

Net realized gain/(loss) on investments in securities and foreign exchange translations

  

 

70,783,468

 

  

 

(199,953,321

)

Net change in unrealized appreciation/(depreciation) on investments in securities, foreign currency transactions and translations

  

 

298,906,032

 

  

 

306,291,936

 

Net increase in net assets resulting from operations

  

 

379,367,319

 

  

 

124,473,862

 
   

 

  

 

  

 

  

 

Dividends and distributions declared:

  

 

  

 

  

 

  

 

Class I

  

 

(18,885,138

)

  

 

(10,360,602

)
   

 

  

 

  

 

  

 

Share transactions:

  

 

  

 

  

 

  

 

Proceeds from sales of shares

  

 

71,870,622

 

  

 

135,165,601

 

Net asset value of shares issued to shareholders for reinvestment of dividends and distributions

  

 

495,649

 

  

 

276,268

 

Cost of shares redeemed

  

 

(219,365,176

)

  

 

(442,745,407

)

Net decrease in net assets resulting from share transactions

  

 

(146,998,905

)

  

 

(307,303,538)

 

Total increase/(decrease) in net assets

  

 

213,483,276

 

  

 

(193,190,278

)

NET ASSETS:

  

 

  

 

  

 

  

 

Beginning of period/year

  

 

1,857,222,450

 

  

 

2,050,412,728

 

End of period/year

  

$

2,070,705,726

 

  

$

1,857,222,450

 

The accompanying notes are an integral part of these financial statements.

16

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

FINANCIAL HIGHLIGHTS

Selected per share data and ratios for a Class I share outstanding throughout each period/year.
 

For the
six months
ended
April 30, 2024
(unaudited)

  




For the years ended October 31,

2023

  

2022

  

2021

  

2020

  

2019

Net asset value, beginning of
period/year

  

$

13.28

 

  

$

12.68

 

  

$

21.10

 

  

$

17.73

 

  

$

16.15

 

  

$

14.90

 

Income from investment operations:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Net investment income1

  

 

0.07

 

  

 

0.12

 

  

 

0.07

 

  

 

0.14

 

  

 

0.04

 

  

 

0.10

 

Net realized and unrealized
gain/(loss)

  

 

2.68

 

  

 

0.55

 

  

 

(6.14

)

  

 

3.79

 

  

 

1.81

 

  

 

2.19

 

Total income/(loss) from investment operations

  

 

2.75

 

  

 

0.67

 

  

 

(6.07

)

  

 

3.93

 

  

 

1.85

 

  

 

2.29

 

Dividends and distributions to shareholders:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

From net investment income

  

 

(0.14

)

  

 

(0.07

)

  

 

(0.13

)

  

 

(0.04

)

  

 

(0.09

)

  

 

(0.16

)

From net realized gains

  

 

—

 

  

 

—

 

  

 

(2.22

)

  

 

(0.52

)

  

 

(0.18

)

  

 

(0.88

)

Total dividends and distributions to shareholders

  

 

(0.14

)

  

 

(0.07

)

  

 

(2.35

)

  

 

(0.56

)

  

 

(0.27

)

  

 

(1.04

)

Net asset value, end of period/year

  

$

15.89

 

  

$

13.28

 

  

$

12.68

 

  

$

21.10

 

  

$

17.73

 

  

$

16.15

 

Total return2

  

 

20.73

%3

  

 

5.24

%

  

 

(31.91

)%

  

 

22.38

%

  

 

11.59

%

  

 

16.92

%
   

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Ratios/Supplemental data:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Net assets, end of period/year
(in millions)

  

$

2,071

 

  

$

1,857

 

  

$

2,050

 

  

$

2,718

 

  

$

2,029

 

  

$

1,790

 

Ratio of expenses to average net assets before reductions

  

 

0.63

%4

  

 

0.64

%

  

 

0.68

%

  

 

0.68

%

  

 

0.69

%

  

 

0.71

%

Expense offset arrangement

  

 

—

%

  

 

—

%

  

 

—

%

  

 

—

%

  

 

—

%

  

 

(0.01

)%

Ratio of expenses to average net assets after reductions

  

 

0.63

%4

  

 

0.64

%

  

 

0.68

%

  

 

0.68

%

  

 

0.69

%

  

 

0.70

%

Ratio of net investment income to average net assets

  

 

0.93

%4

  

 

0.85

%

  

 

0.45

%

  

 

0.65

%

  

 

0.22

%

  

 

0.66

%

Portfolio turnover rate

  

 

37

%3

  

 

65

%

  

 

52

%

  

 

86

%

  

 

77

%

  

 

135

%
   

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

____________

​1       Calculated using average shares outstanding for the period/year.

​2       Assumes the reinvestment of distributions.

​3       Not annualized.

​4       Annualized.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

17

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

NOTES TO FINANCIAL STATEMENTS

April 30, 2024 (unaudited)

1.  Organization. The Fund is a separate, diversified series of BBH Trust (the “Trust”), which is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust was originally organized under the laws of the State of Maryland on July 16, 1990 as BBH Fund, Inc. and re-organized as a Delaware statutory trust on June 12, 2007. As of April 30, 2024, there were eight series of the Trust. The Fund commenced operations on June 6, 1997 and currently offers one class, Class I. The investment objective of the Fund is to provide investors with long-term maximization of total return, primarily through capital appreciation. Under normal circumstances, at least 80% of the net assets of the Fund, plus any borrowings for investment purposes, are invested in equity securities of companies in the developed and emerging markets of the world, excluding the United States.

2. Significant Accounting Policies. The Fund’s financial statements are prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”). The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 Financial Services – Investment Companies. The following summarizes significant accounting policies of the Fund:

A. Valuation of Investments. The Board of Trustees (the “Board”) has ultimate responsibility for the supervision and oversight of the determination of the fair value of investments. Pursuant to Rule 2a-5 of the 1940 Act, the Board has designated the Investment Adviser as its valuation designee. The Investment Adviser monitors the continual appropriateness of valuation methods applied and determines if adjustments should be made in light of market factor changes and events affecting issuers. The Investment Adviser performs a series of activities to provide reasonable assurance of the appropriateness of the prices utilized, including but not limited to: periodic independent pricing service due diligence meetings and reviewing the results of back testing on a monthly basis. The Investment Adviser provides the Board with reporting on the results of the back testing as well as positions which were fair valued during the period.

All securities and other investments are recorded at their estimated fair value. The value of investments listed on a securities exchange is based on the last sale price prior to the time when assets are valued, or in the absence of recorded sales, at the most recent bid price on such exchange. If a readily available market quotation is not available or is determined to be unreliable, the investments may be valued utilizing evaluated prices provided by independent pricing services. In establishing such prices, the independent pricing service utilizes both dealer supplied prices and electronic data processing techniques which take into account appropriate factors such as institutional sized trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics, the closure of the primary exchange on which securities trade and before the Fund’s net asset value is next determined and other market data without exclusive reliance on quoted exchange prices or over-the-counter prices since such valuations are believed to

18

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

reflect more accurately the fair value of such investments. Investments may be fair valued by Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“SID” or “Investment Adviser”) in accordance with the BBH Trust Portfolio Valuation Policy and Procedures using methods that most fairly reflect the amount that the Fund would reasonably expect to receive for the investment on a current sale in its principal market in the ordinary course of business. Short-term investments, which mature in 60 days or less are valued at amortized cost if their original maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if their original maturity when acquired by the Fund was more than 60 days, unless the use of amortized cost is determined not to represent fair value. Any futures contracts held by the Fund are valued daily at the official settlement price of the exchange on which they are traded.

B. Accounting for Investments and Income. Investment transactions are accounted for on the trade date. Realized gains and losses on investment transactions are determined based on the identified cost method. Dividend income and other distributions received from portfolio securities are recorded on the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of securities received at ex-date. Distributions received on securities that represent a return of capital are recorded as a reduction of cost of investments. Distributions received on securities that represent a capital gain are recorded as a realized gain. Interest income is accrued daily. Investment income is recorded net of any foreign taxes withheld where recovery of such tax is uncertain.

C. Fund Expenses. Most expenses of the Trust can be directly attributed to a specific fund. Expenses which cannot be directly attributed to a fund are generally apportioned among each fund in the Trust on a net assets basis. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

D. Forward Foreign Currency Exchange Contracts. The Fund may enter into forward foreign currency exchange contracts (“Contracts”) in connection with planned purchases or sales of securities to economically hedge the U.S. dollar value of securities denominated in a particular currency, or to increase or shift its exposure to a currency other than U.S. dollars. The Fund has no specific limitation on the percentage of assets which may be committed to these types of Contracts. The Fund could be exposed to risks if the counterparties to the Contracts are unable to meet the terms of their Contracts or if the value of the foreign currency changes unfavorably. The U.S. dollar values of foreign currency underlying all contractual commitments held by the Fund are determined using forward foreign currency exchange rates supplied by a quotation service. During the six months ended April 30, 2024, the Fund had no open contracts.

E. Foreign Currency Translations. The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange of such currency against the U.S. dollar to determine the value of investments, assets and liabilities.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

19

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

Purchases and sales of securities, and income and expenses are translated at the prevailing rate of exchange on the respective dates of such transactions. Upon the purchase or sale of a security denominated in foreign currency, the Fund may enter into forward foreign currency exchange contracts for the purchase or sale, for a fixed amount of U.S. dollars, of the amount of foreign currency involved in the underlying security transaction. Reported net realized gains and losses arise from the sales of portfolio securities, sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. The effect of changes in foreign exchange rates on foreign denominated securities is reflected in the net realized and unrealized gain or loss on investments in securities and foreign exchange transactions and translations and net change in unrealized appreciation or depreciation on investments in securities and foreign currency translations within the Statement of Operations. Net unrealized appreciation or depreciation on foreign currency translations arise from changes in the value of the assets and liabilities, excluding investments in securities, at period end, resulting from changes in the exchange rate.

F. Rule 144A Securities. The Fund may purchase securities that are not registered under the Securities Act of 1933, as amended (“1933 Act”) but that can be sold to “qualified institutional buyers” in accordance with the requirements stated in Rule 144A under the 1933 Act (“Rule 144A Securities”). A Rule 144A Security may be considered illiquid, under SEC Regulations for open-end investment companies, and therefore subject to the 15% limitation on the purchase of illiquid securities, unless it is determined on an ongoing basis that an adequate trading market exists for the security, which is the case for the Fund. Guidelines have been adopted and the daily function of determining and monitoring liquidity of Rule 144A Securities has been delegated to the investment adviser. All relevant factors will be considered in determining the liquidity of Rule 144A Securities and all investments in Rule 144A Securities will be carefully monitored. Information regarding Rule 144A Securities is included at the end of the Portfolio of Investments.

G. Federal Income Taxes. The Fund may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. The Fund will accrue such taxes and recoveries, as applicable, based upon its current interpretation of tax rules and regulations that exist in the markets in which it invests.

Realized gains in certain countries may be subject to foreign taxes at the Fund level, based on statutory rates. The Fund accrues for such foreign taxes on net realized and unrealized gains at the appropriate rate for each jurisdiction, as applicable. The amount, if any, is disclosed as a liability in the Statement of Assets and Liabilities and as an expense in the Statement of Operations.

20

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

It is the Trust’s policy to comply with the requirements of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. The Fund files a tax return annually using tax accounting methods required under provisions of the Code, which may differ from GAAP, which is the basis on which these financial statements are prepared. Accordingly, the amount of net investment income and net realized gain reported in these financial statements may differ from that reported on the Fund’s tax return, due to certain book-to-tax timing differences such as losses deferred due to “wash sale” transactions and utilization of capital loss carryforwards. These differences may result in temporary over-distributions for financial statement purposes and are classified as distributions in excess of accumulated net realized gains or net investment income. These distributions do not constitute a return of capital. Permanent differences are reclassified between paid-in capital and retained earnings/(accumulated deficit) within the Statement of Assets and Liabilities based upon their tax classification. As such, the character of distributions to shareholders reported in the Financial Highlights table may differ from that reported to shareholders on Form 1099-DIV.

The Fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (“ASC 740”). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The Fund did not have any unrecognized tax benefits as of October 31, 2023, nor were there any increases or decreases in unrecognized tax benefits for the year then ended. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits as an income tax expense in the Statement of Operations. During the six months ended April 30, 2024, the Fund did not incur any such interest or penalties. The Fund is subject to examination by U.S. federal and state tax authorities for returns filed for the prior three years. The Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

H. Dividends and Distributions to Shareholders. Dividends and distributions from net investment income to shareholders, if any, are paid annually and are recorded on the ex-dividend date. Distributions from net capital gains, if any, are generally declared and paid annually and are recorded on the ex-dividend date. The Fund declared dividends and distributions in the amount of $18,885,138 to Class I shares during the six months ended April 30, 2024. In addition, the Fund designated a portion of the payment made to redeeming shareholders as a distribution for income tax purposes.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

21

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

The tax character of distributions paid during the years ended October 31, 2023 and 2022, respectively, were as follows:

 

Distributions paid from:
   

Ordinary
income

  

Net
long-term
capital gain

  

Total 
taxable
distributions

  

Tax return
of capital

  

Total
distributions
paid

2023:

  

$ 10,360,602

  

$              —

  

$ 10,360,602

  

$      —

  

$ 10,360,602

2022:

  

 114,819,518

  

 192,023,493

  

  306,843,011

  

        —

  

  306,843,011

As of October 31, 2023 and 2022, respectively, the components of retained earnings/(accumulated deficit) were as follows:

 

Components of retained earnings/(accumulated deficit):
   

Undistributed
ordinary
income

  

Undistributed
long-term
capital gain

  

Accumulated
capital and
other losses

  

Other
book/tax
temporary
differences

  

Unrealized
appreciation/
(depreciation)

  

Total
retained
earnings/
(accumulated
deficit)

2023:

  

$18,010,377

  

$        —

  

$(390,810,946)

  

$(21,982,391)

  

$  75,428,422

  

$(319,354,538)

2022:

  

  10,356,068

  

          —

  

  (193,247,052)

  

  (19,713,300)

  

  (230,863,514)

  

  (433,467,798)

The Fund had $390,810,946 of net capital loss carryforwards as of October 31, 2023, of which $233,039,581 and $157,771,365, is attributable to short-term and long-term capital losses, respectively.

The Fund is permitted to carryforward capital losses for an unlimited period and they will retain their character as either short-term or long-term capital losses.

Total distributions paid may differ from amounts reported in the Statements of Changes in Net Assets because, for tax purposes, dividends are recognized when actually paid.

The differences between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable primarily to the tax deferral of losses on wash sales.

To the extent future capital gains are offset by capital loss carryforwards, if any, such gains will not be distributed.

I.  Use of Estimates. The preparation of the financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increase and decrease in net assets from operations during the reporting period. Actual results could differ from these estimates.

22

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

3. Fees and Other Transactions with Affiliates

A. Investment Advisory and Administrative Fees. Under a combined Investment Advisory and Administrative Services Agreement (“Agreement”) with the Trust, the Investment Adviser provides investment advisory, portfolio management and administrative services to the Fund. The Fund’s investment advisory and administrative services fee is calculated daily and paid monthly at an annual rate equivalent to 0.60% per annum on the first $3 billion of average daily net assets and 0.55% per annum on all average daily net assets over $3 billion. BBH employs a “manager-of-managers” investment approach, whereby it allocates the Fund’s assets to the Fund’s Sub-Advisers, currently Select Equity Group, L.P. (“Select Equity Group”) and Trinity Street Asset Management (together the “Sub-Advisers”). The Sub-Advisers are responsible for investing the assets of the Fund and the Investment Adviser oversees the Sub-Advisers and evaluates their performance results. The Investment Adviser pays each Sub-Adviser from its investment advisory and administrative fee an amount that in the aggregate equals the Fund’s investment advisory and administration fee based upon the percentage of net assets that each Sub-Adviser manages. For the six months ended April 30, 2024, the Fund incurred $6,238,227 for services under the Agreement.

B. Custody and Fund Accounting Fees. BBH acts as a custodian and fund accountant and receives custody and fund accounting fees from the Fund calculated daily and paid monthly. BBH holds all of the Fund’s cash and investments and calculates the Fund’s daily net asset value. The custody fee is based partially on asset values and partially on individual fund transactions. The fund accounting fee is primarily an asset-based fee calculated at 0.325 basis points per annum of the Fund’s net asset value. For the six months ended April 30, 2024, the Fund incurred $141,236 in custody and fund accounting fees. As per agreement with the Fund’s custodian, the Fund receives interest income on cash balances held by the custodian at the BBH Base Rate. The BBH Base Rate is defined as BBH’s effective trading rate in local money markets on each day. The total interest earned by the Fund for the six months ended April 30, 2024 was $492,007. This amount is included in “Interest income from Custodian” in the Statement of Operations. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to their agreement, the Fund will pay the BBH Overdraft Base Rate plus 2% on the day of the overdraft. The total interest incurred by the Fund for the six months ended April 30, 2024, was $18,671. This amount is included under line item “Custody and fund accounting fees” in the Statement of Operations.

C. Board of Trustees’ Fees. Each Trustee who is not an “interested person” as defined under the 1940 Act receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the six months ended April 30, 2024, the Fund incurred $48,967 in independent Trustee compensation and expense reimbursements.

D. Officers of the Trust. Officers of the Trust are also employees of BBH. Officers are paid no fees by the Trust for their services to the Trust.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

23

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

4. Investment Transactions. For the six months ended April 30, 2024, the cost of purchases and the proceeds of sales of investment securities, other than short-term investments, were $750,881,649 and $890,596,431, respectively.

5. Shares of Beneficial Interest. The Trust is permitted to issue an unlimited number of Class I shares of beneficial interest, at no par value. Transactions in Class I shares were as follows:

     

For the six months ended
April 30, 2024
(unaudited)

  

For the year ended
October 31, 2023
   

Shares

  

Dollars

  

Shares

  

Dollars

Class I

    

 

  

 

  

 

    

 

  

 

  

 

Shares sold

  

4,589,418

 

  

$

71,870,622

 

  

9,345,985

 

  

$

135,165,601

 

Shares issued in connection with reinvestments of dividends

  

32,587

 

  

 

495,649

 

  

19,947

 

  

 

276,268

 

Shares redeemed

  

(14,147,195

)

  

 

(219,365,176

)

  

(31,157,761

)

  

 

(442,745,407

)

Net decrease

  

(9,525,190

)

  

$

(146,998,905

)

  

(21,791,829

)

  

$

(307,303,538

)

6. Principal Risk Factors and Indemnifications.

A. Principal Risk Factors. Investing in the Fund may involve certain risks, as discussed in the Fund’s prospectus, including, but not limited to, those described below:

A shareholder may lose money by investing in the Fund (investment risk). The Fund is actively managed and the decisions by the Sub-Adviser may cause the Fund to incur losses or miss profit opportunities (management risk). Price movements may occur due to factors affecting individual companies, such as the issuance of an unfavorable earnings report, or other events affecting particular industries or the equity market as a whole (equity securities risk). The value of securities held by the Fund may fall due to changing economic, political, regulatory or market conditions, or due to a company’s or issuer’s individual situation. Natural disasters, the spread of infectious illness and other public health emergencies, recession, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse effects on world economies and markets generally (market risk). The Fund may, from time to time, invest in a limited number of issuers. As a result, the appreciation or depreciation of any one security held by the Fund will have a greater impact on the Fund’s net asset value than it would if the Fund invested in a larger number of securities. Although that strategy has the potential to generate attractive returns over time, it also increases the Fund’s volatility and may lead to greater losses (concentrated portfolio holdings risk). There are certain risks associated with investing in securities of companies based outside of the United States, including, but not limited to, recovery of tax withheld by foreign jurisdictions (Non-U.S. investment risk), capital controls imposed by foreign governments in response to economic or political events

24

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

that may impact the ability of the Fund to buy, sell or otherwise transfer securities or currency (capital controls risk), and risks from investing in securities of issuers based in developing countries (emerging markets risk). Non-U.S. currencies invested in by the Fund may depreciate against the U.S. dollar (currency exchange rate risk). The Fund’s shareholders may be adversely impacted by asset allocation decisions made by an investment adviser whose discretionary clients make up a large percentage of the Fund’s shareholders (shareholder concentration risk). Because the Fund invests in large cap company securities, it may underperform other funds during periods when the Fund’s large cap securities are out of favor (large cap company risk). The extent of the Fund’s exposure to these risks in respect to these financial assets is included in their value as recorded in the Fund’s Statement of Assets and Liabilities.

Please refer to the Fund’s prospectus for a complete description of the principal risks of investing in the Fund.

B. Indemnifications. Under the Trust’s organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the Fund, and shareholders are indemnified against personal liability for the obligations of the Trust. Additionally, in the normal course of business, the Fund enters into agreements with service providers that may contain indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss from such claims is considered remote.

7. Subsequent Events. Management has evaluated events and transactions that have occurred since April 30, 2024 through the date the financial statements were issued and determined that there were no subsequent events that would require recognition or additional disclosure in the financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

25

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

DISCLOSURE OF FUND EXPENSES

April 30, 2024 (unaudited)

EXAMPLE

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested distributions, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the six-month period and held for the entire period (November 1, 2023 to April 30, 2024).

ACTUAL EXPENSES

The first line of the table below provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during the period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% Hypothetical Example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

26

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

DISCLOSURE OF FUND EXPENSES (continued)

April 30, 2024 (unaudited)

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

Beginning
Account Value
November 1, 2023

  

Ending
Account Value
April 30, 2024

  

Expenses Paid
During Period
November 1, 2023 to
April 30, 20241

Class I

            

Actual

  

$1,000

  

$1,207

  

$3.46

Hypothetical2

  

$1,000

  

$1,022

  

$3.17

____________

​1  Expenses are equal to the Fund’s annualized net expense ratio of 0.63% for I shares, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period).

​2   Assumes a return of 5% before expenses. For the purposes of the calculation, the applicable annualized expenses ratio for each class of shares is subtracted from the assumed return before expenses.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

27

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

DISCLOSURE OF ADVISOR SELECTION

April 30, 2024 (unaudited)

Investment Advisory and Administrative Services and Sub-Advisory Agreements Approval

The 1940 Act requires that a fund’s investment advisory agreements must be approved both by a fund’s board of trustees and by a majority of the trustees who are not parties to the investment advisory agreements or “interested persons” of any party (“Independent Trustees”), cast in person at a meeting called for the purpose of voting on such approval.

The Board, a majority of which is comprised of Independent Trustees, held meetings on November 16, 2023 and December 12, 2023, to consider whether to renew the combined Amended and Restated Investment Advisory and Administrative Services Agreement (the “Advisory Agreement”) between the Trust and the Investment Adviser with respect to the existing funds in the Trust, including the Fund. At these meetings, the Board also considered the renewal of the sub-advisory agreement (the “Sub-Advisory” and, together with the Advisory Agreement, the “Agreements”) between the Investment Adviser and Select Equity Group, L.P. (“Select Equity Group” or the “Sub-Adviser”). At the December 12, 2023 meeting, the Board voted to approve the renewal of the Agreements with respect to the Fund for an additional one-year term. In doing so, the Board determined that the terms of the Agreements were fair and reasonable in the best interest of the Fund and its shareholders, and that it had received sufficient information to make an informed business decision with respect to the continuation of the Agreements. The Board had reviewed and approved the initial sub-advisory agreement between the Investment Adviser and a second sub-adviser, Trinity Street Asset Management, in July 2023. That agreement was not renewed as it was still in its initial two years period.

Both in the meetings specifically held to address the continuance of the Agreements and at other meetings over the course of the year, the Board requested, received and assessed a variety of materials provided by the Investment Adviser, Sub-Adviser and BBH, including, among other things, information about the nature, extent and quality of the services provided to the Fund by the Investment Adviser, the Sub-Adviser and BBH, including investment management and administrative, the oversight of Fund service providers, marketing, risk oversight, compliance, and the ability to meet applicable legal and regulatory requirements.

The Board also received comparative performance and fee and expense information for the Fund prepared by Broadridge Financial Solutions, Inc. (“Broadridge”) using data from Lipper Inc., an independent provider of investment company data (“Lipper Report”). The Board reviewed this report with Broadridge, Fund Counsel and BBH. The Board received from, and discussed with, counsel to the Trust (“Fund Counsel”) a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements under the 1940 Act, as well as the guidance provided in Gartenberg v. Merrill Lynch Asset Management, Inc., which was affirmed in Jones v. Harris Associates, L.P. In addition, the Board met in executive session outside the presence of Fund management.

In approving the continuation of the Agreements, the Board considered: (a) the nature, extent and quality of services provided by the Investment Adviser and Sub-Adviser; (b) the investment performance of the Fund; (c) the advisory fee and the cost of the services and profits to be realized by the Investment Adviser from its relationship with the Fund; (d) the Fund’s costs to investors compared to the costs of comparative funds and performance compared to the relevant performance of comparative funds; (e) the sharing of potential

28

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

economies of scale; (f) fall-out benefits to the Investment Adviser as a result of its relationship with the Fund; and (g) other factors deemed relevant by the Board. The following is a summary of the factors the Board considered in making its determination to approve the continuance of the Agreements. No single factor reviewed by the Board was identified as the principal factor in determining whether to approve the Advisory Agreement, and individual Trustees may have given different weight to various factors. The Board reviewed these factors with Fund Counsel. The Board concluded that the fees paid by the Fund to the Investment Adviser and Select Equity Group were reasonable based on the comparative performance, expense information, the cost of the services provided, and the profits realized by the Investment Adviser.

Nature, Extent and Quality of Services

The Board noted that, under the Advisory Agreement and with respect to the Fund, the Investment Adviser, subject to the supervision of the Board, is responsible for providing administrative services and overseeing the investment advisory services provided to the Fund under the same fee structure. Pursuant to the Sub-Advisory Agreement, the Sub-Adviser, subject to the supervision of the Investment Adviser and the Board is responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Fund’s investment objective and policies.

The Board received and considered information during the December 12, 2023 meeting, and over the course of the previous year, regarding the nature, extent and quality of services provided to the Fund by the Investment Adviser including: the supervision of the Sub-Adviser, supervision of operations and compliance and regulatory filings, disclosures to Fund shareholders, general oversight of service providers, organizing Board meetings and preparing the materials for such Board meetings, assisting the Board (including the Independent Trustees in their capacity as Trustees), legal and Chief Compliance Officer services for the Trust, and other services necessary for the operation of the Fund. The Board considered the resources of the Investment Adviser and BBH, as a whole, dedicated to the Fund noting that, pursuant to separate agreements, BBH also provides custody and fund accounting services to the Fund. The Board considered the depth and range of services provided pursuant to the Agreement, noting that the Investment Adviser also coordinates the provision of services to the Fund by affiliated and nonaffiliated service providers.

The Board considered the scope and quality of services provided by the Investment Adviser under the Advisory Agreement. The Board also considered the policies and practices followed by BBH and the Investment Adviser. The Board noted that during the course of its regular meetings it received reports on each of the foregoing topics. The Board concluded that, overall, they were satisfied with the nature, extent and quality of the investment advisory and administrative services provided, and expected to be provided, to the Fund pursuant to the Agreements. The Board received and considered information, during the meeting held on December 12, 2023, and over the course of the year, regarding the nature, extent and quality of services provided to the Fund by the Sub-Adviser, particularly portfolio management in light of the narrower scope of services performed by the Sub-Adviser. The Board also considered brokerage policies and practices and the standards applied in seeking best execution. The Board reviewed the qualifications of the key investment personnel primarily responsible for the day-to-day portfolio management of the Fund.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

29

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Fund Performance

At the November 16, 2023 and December 12, 2023 meetings, and throughout the year, the Board received and considered performance information for the Fund provided by BBH. The Board considered the Fund’s performance relative to a peer category of other mutual funds in a report compiled by Broadridge. As part of this review, the Trustees considered the composition of the peer category, selection criteria and reputation of Broadridge who prepared the peer category analysis. The Board reviewed and discussed, with both BBH and Broadridge, the report’s findings and discussed the positioning of the Fund relative to the selected peer category.

The Board considered short-term and long-term investment performance for the Fund over various periods of time as compared to a selection of peer funds, noting the Fund’s below average performance in the 1-, 2-, 3-, 4-, 5- and 10-year periods ended September 30, 2023. They further noted the Fund’s historical track record of positive absolute returns was consistent with the investment approach communicated to investors. In evaluating the performance of the Fund, the Board considered the addition of the new sub-adviser, the risk expectations for the Fund as well as the level of Fund performance in the context of Fund expenses and the Investment Adviser’s profitability.

Costs of Services Provided and Profitability

The Board considered the fee rates paid by the Fund to the Investment Adviser and BBH in light of the nature, extent and quality of the services provided to the Fund. The Board considered the depth and range of services provided pursuant to the Advisory Agreement, noting that the Investment Adviser also coordinates the provision of services to the Fund by affiliated and nonaffiliated service providers. The Board received and considered information comparing the Fund’s combined investment advisory and administration fee and the Fund’s net operating expenses with those of other comparable mutual funds, such peer group and comparisons having been selected and calculated by Broadridge, noting that the Fund compared favorably to the selected peer-set. The Board recognized that it is difficult to make comparisons of the fee rate, or of combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds. The Board concluded that the advisory and administration fee appeared to be both reasonable in light of the services rendered and the result of arm’s length negotiations.

The Board also considered the fees paid to the Sub-Adviser for their services to the Fund. The compensation paid to the Sub-Adviser is paid by the Investment Adviser, not the Fund directly, and, accordingly, the retention of the Sub-Adviser does not increase the fees or expenses otherwise incurred by the Fund’s shareholders.

With regard to profitability, the Trustees considered the compensation flowing to the Adviser and BBH, directly or indirectly, and to the Sub-Adviser. The Board reviewed profitability data for the Fund using data from October 1, 2022 through September 30, 2023 for both the Investment Adviser and BBH. The data also included the effect of revenue generated by the custody and fund accounting and administration fees paid by the Fund to BBH and corresponding expenses. The Board conducted a detailed review of the allocation methods used in preparing the profitability data.

30

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

The Board also considered the effect of fall-out benefits on the expenses of the Investment Adviser and BBH such as the increased visibility of BBH’s investment management business due to the distribution of the Funds. The Board focused on profitability of the Investment Adviser’s and BBH’s relationships with the Fund before taxes and distribution expenses. The Board concluded that neither the Investment Adviser and BBH’s nor the Sub-Adviser’s profitability was excessive in light of the nature, extent and quality of services provided to the Fund. The Board considered other benefits received by BBH, the Investment Adviser, and the Sub-Adviser, as applicable, as a result of their relationships with the Fund. These other benefits include proprietary research received from brokers that execute the Fund’s purchases and sales of securities and fees received for being the Fund’s administer, custodian and fund accounting agent. In light of the costs of providing services pursuant to the Advisory Agreement as well as the Investment Adviser and BBH’s commitment to the Fund, the ancillary benefits that the Investment Adviser and BBH received were considered reasonable.

Economies of Scale

The Board also considered the existence of economies of scale and whether those economies are passed along to the Fund’s shareholders through a graduated investment advisory fee schedule or other means, including any fee waivers by the Investment Adviser and BBH. The Board considered the fee schedule for the Fund, noting the existence of a graduated investment advisory fee. Based on information they had provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Fund, there appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints apply. In light of the Fund’s current size and expense structure, the Board concluded that the current breakpoints for the Fund were reasonable. The Board concluded that the fees paid by the Fund to the Investment Adviser, and from the Investment Adviser to the Sub-Adviser, were reasonable based on the comparative performance, expense information, the cost of the services comparative performance, expense information, the cost of the services provided and the profits to the realized by the Investment Adviser.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

31

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

CONFLICTS OF INTEREST

April 30, 2024 (unaudited)

BBH&Co., including the Investment Adviser, provides discretionary and non-discretionary investment management services and products to corporations, institutions and individual investors throughout the world. As a result, in the ordinary course of its businesses, BBH&Co., including the Investment Adviser, may engage in activities in which its interests or the interests of its clients may conflict with or be adverse to the interests of the Funds. In addition, certain of such clients (including the Funds) utilize the services of BBH&Co. for which they will pay to BBH&Co. customary fees and expenses that will not be shared with the Funds.

The Investment Adviser and the Sub-advisers have adopted and implemented policies and procedures that seek to manage conflicts of interest. Pursuant to such policies and procedures, the Investment Adviser and each Sub-adviser monitor a variety of areas, including compliance with fund investment guidelines, the investment in only those securities that have been approved for purchase, and compliance with their respective Code of Ethics.

The Trust also manages these conflicts of interest. For example, the Trust has designated a CCO and has adopted and implemented policies and procedures designed to manage the conflicts identified below and other conflicts that may arise in the course of the Funds’ operations in such a way as to safeguard the Funds from being negatively affected as a result of any such potential conflicts. From time to time, the Trustees receive reports from the Investment Adviser, the Sub-advisers and the Trust’s CCO on areas of potential conflict.

Investors should carefully review the following, which describes potential and actual conflicts of interest that BBH&Co., the Investment Adviser and Sub-advisers can face in the operation of their respective investment management services. This section is not, and is not intended to be, a complete enumeration or explanation of all of the potential conflicts of interest that may arise. The Investment Adviser, the Sub-advisers and the Funds has adopted policies and procedures reasonably designed to appropriately prevent, limit or mitigate the conflicts of interest described below. Additional information about potential conflicts of interest regarding the Investment Adviser is set forth in the Investment Adviser’s Form ADV. A copy of Part 1 and Part 2A of the Investment Adviser’s Form ADV is available on the SEC’s website (www.adviserinfo.sec.gov). In addition, many of the activities that create these conflicts of interest are limited and/or prohibited by law, unless an exception is available.

Other Clients and Allocation of Investment Opportunities. BBH&Co., the Investment Adviser, and the Sub-advisers manage funds and accounts of clients other than the Funds (“Other Clients”). In general, BBH&Co., the Investment Adviser, and the Sub-advisers face conflicts of interest when they render investment advisory services to different clients and, from time to time, provide dissimilar investment advice to different clients. Investment decisions will not necessarily be made in parallel among the Funds and Other Clients. Investments made by the Funds do not, and are not intended to, replicate the investments, or the investment methods and strategies, of Other Clients. Accordingly, such Other Clients may produce results that are materially different from those experienced by the Funds. Certain other conflicts of interest may arise in connection with a portfolio manager’s management of the Funds’ investments, on the one hand, and the investments of other funds or accounts for which the portfolio manager is responsible, on the other. For example, it is possible that the various funds or accounts managed

32

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

by the Investment Adviser or Sub-advisers could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Funds. From time to time, the Investment Adviser and Sub-advisers, sponsor and with other investment pools and accounts which engage in the same or similar businesses as the Funds using the same or similar investment strategies. To the extent that the same investment opportunities might be desirable for more than one account or fund, possible conflicts could arise in determining how to allocate them because the Investment Adviser or Sub-advisers may have an incentive to allocate investment opportunities to certain accounts or funds. However, BBH&Co. and the Investment Adviser have implemented policies and procedures designed to ensure that information relevant to investment decisions is disseminated promptly within its portfolio management teams and investment opportunities are allocated equitably among different clients. The policies and procedures require, among other things, objective allocation for limited investment opportunities, and documentation and review of justifications for any decisions to make investments only for select accounts or in a manner disproportionate to the size of the account. Nevertheless, access to investment opportunities may be allocated differently among accounts due to the particular characteristics of an account, such as size of the account, cash position, tax status, risk tolerance and investment restrictions or for other reasons.

Actual or potential conflicts of interest may also arise when a portfolio manager has management responsibilities to multiple accounts or funds, resulting in unequal commitment of time and attention to the portfolio management of the funds or accounts.

Affiliated Service Providers. Other potential conflicts might include conflicts between the Funds and its affiliated and unaffiliated service providers (e.g., conflicting duties of loyalty). In addition to providing investment management services through the SID, BBH&Co. provides administrative, custody, shareholder servicing and fund accounting services to the Funds. BBH&Co. may have conflicting duties of loyalty while servicing the Funds and/or opportunities to further its own interest to the detriment of the Funds. For example, in negotiating fee arrangements with affiliated service providers, BBH&Co. may have an incentive to agree to higher fees than it would in the case of unaffiliated providers. BBH&Co. acting in its capacity as the Funds’ administrator is the primary valuation agent of the Funds. BBH&Co. values securities and assets in the Funds according to the Funds’ valuation policies. Because the Investment Adviser’s advisory and administrative fees are calculated by reference to a Funds’ net assets, BBH&Co. and its affiliates may have an incentive to seek to overvalue certain assets.

Aggregation. Potential conflicts of interest also arise with the aggregation of trade orders. Purchases and sales of securities for the Funds may be aggregated with orders for other client accounts managed by the Sub-advisers. The Sub-advisers, however, are not required to aggregate orders if portfolio management decisions for different accounts are made separately, or if it is determined that aggregating is not practicable, or in cases involving client direction. Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds will be charged or credited with the average price. Thus, the effect of the aggregation may operate on some occasions to the disadvantage of the Funds. In addition, under certain circumstances, the Funds will not be charged the same commission or commission equivalent rates in connection with an aggregated order.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

33

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Cross Trades. Under certain circumstances, the Investment Adviser, on behalf of the Funds, may seek to buy from or sell securities to another fund or account advised by BBH, the Investment Adviser. Subject to applicable law and regulation, BBH&Co., the Investment Adviser may (but is not required to) effect purchases and sales between BBH&Co., the Investment Adviser clients (“cross trades”), including the Funds, if BBH&Co., the Investment Adviser or a Fund’s Sub-adviser believes such transactions are appropriate based on each party’s investment objectives and guidelines. There may be potential conflicts of interest or regulatory issues relating to these transactions which could limit the Investment Adviser’s decision to engage in these transactions for the Funds. BBH&Co., the Investment Adviser and/or a Fund’s Sub-adviser may have a potentially conflicting division of loyalties and responsibilities to the parties in such transactions.

Soft Dollars. The Investment Adviser may direct brokerage transactions and/or payment of a portion of client commissions (“soft dollars”) to specific brokers or dealers or other providers to pay for research or other appropriate services which provide, in the Investment Adviser’s view, appropriate assistance in the investment decision-making process (including with respect to futures, fixed price offerings and over-the-counter transactions). The use of a broker that provides research and securities transaction services may result in a higher commission than that offered by a broker who does not provide such services. The Investment Adviser will determine in good faith whether the amount of commission is reasonable in relation to the value of research and services provided and whether the services provide lawful and appropriate assistance in its investment decision-making responsibilities.

Research or other services obtained in this manner may be used in servicing any or all of the Funds and other accounts managed by the Investment Adviser, including in connection with accounts that do not pay commissions to the broker related to the research or other service arrangements. Such products and services may disproportionately benefit other client accounts relative to the Funds based on the amount of brokerage commissions paid by the Funds and such other accounts. To the extent that a Sub-adviser uses soft dollars, it will not have to pay for those products and services itself.

BBH&Co. may receive research that is bundled with the trade execution, clearing, and/or settlement services provided by a particular broker-dealer. To the extent that a Sub-adviser receives research on this basis, many of the same conflicts related to traditional soft dollars may exist. For example, the research effectively will be paid by client commissions that also will be used to pay for the execution, clearing, and settlement services provided by the broker-dealer and will not be paid by the Sub-adviser.

Arrangements regarding compensation and delegation of responsibility may create conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades, administration of investment advice and valuation of securities.

Investments in BBH Funds. From time to time BBH&Co. may invest a portion of the assets of its discretionary investment advisory clients in the Funds. That investment by BBH&Co. on behalf of its discretionary investment advisory clients in the Funds may be significant at times.

34

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of scale that tend to reduce the Funds’ expense ratio. In selecting the Funds for its discretionary investment advisory clients, BBH&Co. may limit its selection to funds managed by BBH&Co. or the Investment Adviser. BBH&Co. may not consider or canvass the universe of unaffiliated investment companies available, even though there may be unaffiliated investment companies that may be more appropriate or that have superior performance. BBH&Co., the Investment Adviser and their affiliates providing services to the Funds benefit from additional fees when the Funds is included as an investment by a discretionary investment advisory client.

BBH&Co. reserves the right to redeem at any time some or all of the shares of the Funds acquired for its discretionary investment advisory clients’ accounts. A large redemption of shares of the Funds by BBH&Co. on behalf of its discretionary investment advisory clients could significantly reduce the asset size of the Funds, which might have an adverse effect on the Funds’ investment flexibility, portfolio diversification and expense ratio.

Valuation. When market quotations are not readily available or are believed by BBH&Co. to be unreliable, the Funds’ investments will be valued at fair value by BBH&Co. pursuant to procedures adopted by the Funds’ Board. When determining an asset’s “fair value,” BBH&Co. seeks to determine the price that a Fund might reasonably expect to receive from the current sale of that asset in an arm’s-length transaction. The price generally may not be determined based on what the Funds might reasonably expect to receive for selling an asset at a later time or if it holds the asset to maturity. While fair value determinations will be based upon all available factors that BBH&Co. deems relevant at the time of the determination and may be based on analytical values determined by BBH&Co. using proprietary or third-party valuation models, fair value represents only a good faith approximation of the value of a security. The fair value of one or more securities may not, in retrospect, be the price at which those assets could have been sold during the period in which the particular fair values were used in determining the Funds’ net asset value. As a result, the Funds’ sale or redemption of its shares at net asset value, at a time when a holding or holdings are valued by BBH&Co. (pursuant to Board-adopted procedures) at fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.

Referral Arrangements. BBH&Co. may enter into advisory and/or referral arrangements with third parties. Such arrangements may include compensation paid by BBH&Co. to the third party. BBH&Co. may pay a solicitation fee for referrals and/or advisory or incentive fees. BBH&Co. may benefit from increased amounts of assets under management.

Personal Trading. BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, face conflicts of interest when transacting in securities for their own accounts because they could benefit by trading in the same securities as the Funds, which could have an adverse effect on the Funds. However, the Investment Adviser has implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policy and procedures are intended to prevent BBH&Co. Partners and employees from trading in the same securities as the Funds. However, BBH&Co., including the Investment Adviser, has implemented

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

35

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policies and procedures are intended to prevent BBH&Co. Partners and employees with access to Fund material non-public information from trading in the same securities as the Funds.

Gifts and Entertainment. From time to time, employees of BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, may receive gifts and/or entertainment from clients, intermediaries, or service providers to the Funds or BBH&Co., including the Investment Adviser, which could have the appearance of affecting or may potentially affect the judgment of the employees, or the manner in which they conduct business. The Investment Adviser has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees. BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees.

36

    

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM

April 30, 2024 (unaudited)

The Securities and Exchange Commission adopted Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), to promote effective liquidity risk management throughout the open-end investment company industry in order to reduce the risk that funds will be unable to meet their redemption obligations and mitigate dilution of the interests of fund shareholders.

The Board of Trustees (the “Board”) of BBH Trust has appointed three members of the Brown Brothers Harriman & Co. Mutual Fund Advisory Department, the Investment Adviser to the funds of BBH Trust (the “Funds”), as the Program Administrator for each Fund’s liquidity risk management program (the “Program”). The Board met on March 6, 2024 to review the Program for the Funds pursuant to the Liquidity Rule. The Program Administrator provided the Board with a report (the “Report”) that addressed the operations of the Program and assessed its adequacy and effectiveness for the period from February 1, 2023 through January 31, 2024 (the “Reporting Period”).

The Report noted that the Program complied with the key factors for consideration under the Liquidity Rule for assessing, managing and periodically reviewing a Fund’s liquidity risk, including the following points.

Liquidity classification. The Report described the Program’s liquidity classification methodology for categorizing the Funds’ investments into one of four liquidity buckets. The Funds classified each of their investments into one of four liquidity categories based on the number of days reasonably needed to sell and convert a reasonably anticipated sized trade of each investment into cash without significantly impacting the price of the investments. The Program Administrator relied on a third-party data provider to facilitate the classification of each Fund’s investments based on criteria in each Fund’s Program. During the Reporting Period, no Fund held more than 15% of its net assets in illiquid investments.

Highly Liquid Investment Minimum. The Report noted that one aspect of the Liquidity Rule is a requirement that funds that are expected to have less than 50% of assets classified as other than “highly liquid” should establish a minimum percentage of highly liquid assets that the fund is expected to hold on an on-going basis. The Program Administrator monitors the percentages of assets in each category on an ongoing basis and, given that no Fund has approached the 50% threshold, has made the determination that it is not necessary to assign a Highly Liquid Investment Minimum to any of the Funds as provided for in the Liquidity Rule.

The Fund’s investment strategy and liquidity of portfolio investments during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed whether each Fund’s investment strategy is appropriate for an open-end fund structure with a focus on Funds with more significant and consistent holdings of less liquid and illiquid assets and factored a Fund’s concentration in an issuer into the liquidity classification methodology by taking issuer position sizes into account.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

37

 

BBH PARTNER FUND – INTERNATIONAL EQUITY

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM

(continued)

April 30, 2024 (unaudited)

Short-term and long-term cash flow projections during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed historical redemption activity and used this information as a component to establish each Fund’s reasonably anticipated trading size. The Program Administrator also took into consideration other factors such as shareholder ownership concentration, applicable distribution channels and the degree of certainty associated with a Fund’s short-term and long-term cash flow projections.

Holdings of cash and cash equivalents. The Program Administrator considered the degree to which each Fund held cash and cash equivalents as a component of each Fund’s ability to meet redemption requests.

There were no material changes to the Program during the Reporting Period. The Program Administrator has informed the Board that it believes that the Fund’s Program is adequately designed, has been implemented as intended, and has operated effectively since its implementation. No material exceptions have been noted since the implementation of the Program, and there were no liquidity events that impacted the Fund or its ability to meet redemption requests on a timely basis during the Reporting Period.

38

    

 

 

Administrator
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005

Distributor
Alps Distributors, Inc.
1290 Broadway, Suite 1000
Denver, Co 80203

Shareholder Servicing Agent
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005
1-800-575-1265

To obtain information or make shareholder inquiries:

Investment Adviser
Brown Brothers Harriman
Mutual Fund Advisory Department
140 Broadway
New York, NY 10005

By telephone:
By E-mail send your request to:
On the internet:

Call 1-800-575-1265
bbhfunds@bbh.com
www.bbhfunds.com

This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund.

For more complete information, visit www.bbhfunds.com for a prospectus. You should consider the Fund’s investment objectives, risks, charges and expenses carefully before you invest. Information about these and other important subjects is in the Fund’s prospectus, which you should read carefully before investing.

Holdings and allocations are subject to change. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities. Current and future holdings are subject to risk.

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Forms N-PORT are available electronically on the SEC’s website (sec.gov). For a complete list of a fund’s portfolio holdings, view the most recent holdings listing, semi-annual report, or annual report on the Fund’s website at http://www.bbhfunds.com.

A summary of the Fund’s Proxy Voting Policy that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund’s portfolio, as well as a record of how the Fund voted any such proxies during the most recent 12-month period ended June 30, is available, without charge, upon request by calling the toll-free number listed above. This information is also available on the SEC’s website at www.sec.gov.

NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE

 

    

Semi-Annual Report

APRIL 30, 2024

BBH Limited Duration Fund

 

BBH LIMITED DURATION FUND

PORTFOLIO ALLOCATION

April 30, 2024 (unaudited)

BREAKDOWN BY SECURITY TYPE

 

U.S. $ Value

  

Percent of
Net Assets

Asset Backed Securities

  

$

1,583,948,731

  

21.9

%

Commercial Mortgage Backed Securities

  

 

430,859,580

  

6.0

 

Corporate Bonds

  

 

3,139,574,551

  

43.5

 

Loan Participations and Assignments

  

 

856,241,515

  

11.9

 

Municipal Bonds

  

 

30,297,301

  

0.4

 

Residential Mortgage Backed Securities

  

 

19,487,634

  

0.3

 

U.S. Government Agency Obligations

  

 

67,653,646

  

0.9

 

U.S. Treasury Bills

  

 

1,020,423,431

  

14.1

 

U.S. Treasury Bonds and Notes

  

 

14,540,299

  

0.2

 

Cash and Other Assets in Excess of Liabilities

  

 

57,653,833

  

0.8

 

NET ASSETS

  

$

7,220,680,521

  

100.0

%

All data as of April 30, 2024. The BBH Limited Duration Fund’s (the “Fund”) breakdown by security type is expressed as a percentage of net assets and may vary over time.

The accompanying notes are an integral part of these financial statements.

2

    

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

    

ASSET BACKED SECURITIES (21.9%)

        

 

  

 

  

$

10,000,000

  

AGL Core CLO 2, Ltd. 2019-2A (3-Month CME Term SOFR + 1.652%)1,2

  

04/20/32

  

6.976

%

  

$

10,016,889

 

9,114,335

  

AIM Aviation Finance, Ltd. 2015-1A1

  

02/15/40

  

6.213

 

  

 

6,084,092

 

7,555,000

  

Aligned Data Centers Issuer LLC 2023-1A1

  

08/17/48

  

6.000

 

  

 

7,419,279

 

4,571,246

  

Amur Equipment Finance Receivables X LLC 2022-1A1

  

10/20/27

  

1.640

 

  

 

4,468,545

 

7,002,172

  

Amur Equipment Finance Receivables XII LLC 2023-1A1

  

12/20/29

  

6.090

 

  

 

7,023,232

 

3,187,171

  

ARI Fleet Lease Trust 2022-A1

  

01/15/31

  

3.120

 

  

 

3,169,721

 

9,105,000

  

ARI Fleet Lease Trust 2023-B1

  

07/15/32

  

6.050

 

  

 

9,131,412

 

11,930,000

  

Avis Budget Rental Car Funding AESOP LLC 2023-3A1

  

02/22/28

  

5.440

 

  

 

11,846,560

 

9,500,000

  

Avis Budget Rental Car Funding AESOP LLC 2023-7A1

  

08/21/28

  

5.900

 

  

 

9,529,287

 

297,620

  

Bankers Healthcare Group Securitization Trust 2020-A1

  

09/17/31

  

2.560

 

  

 

297,068

 

10,458,575

  

BHG Securitization Trust 2022-A1

  

02/20/35

  

1.710

 

  

 

10,300,333

 

10,971,629

  

BHG Securitization Trust 2023-A1

  

04/17/36

  

5.550

 

  

 

10,873,066

 

7,625,929

  

BHG Securitization Trust 2023-B1

  

12/17/36

  

6.920

 

  

 

7,734,445

 

10,839,168

  

BHG Securitization Trust 2024-1CON1

  

04/17/35

  

5.810

 

  

 

10,799,417

 

12,410,000

  

BlackRock Elbert CLO V LLC 5A (3-Month CME Term SOFR + 1.850%)1,2

  

06/15/34

  

7.179

 

  

 

12,412,122

 

7,784,292

  

Business Jet Securities LLC 2022-1A1

  

06/15/37

  

4.455

 

  

 

7,495,728

 

44,170,000

  

California Street CLO IX LP 2012-9A (3-Month CME Term SOFR + 1.362%)1,2

  

07/16/32

  

6.689

 

  

 

44,262,253

 

29,280,000

  

Carlyle US CLO, Ltd. 2019-2A (3-Month CME
Term SOFR + 1.382%)1,2

  

07/15/32

  

6.710

 

  

 

29,359,586

 

20,392,581

  

CARS-DB4 LP 2020-1A1

  

02/15/50

  

3.190

 

  

 

19,788,276

 

10,113,383

  

CARS-DB7 LP 2023-1A1

  

09/15/53

  

5.750

 

  

 

9,897,783

 

8,085,000

  

CCG Receivables Trust 2023-21

  

04/14/32

  

6.280

 

  

 

8,142,147

 

22,918,037

  

CF Hippolyta Issuer LLC 2020-11

  

07/15/60

  

1.690

 

  

 

21,481,502

 

11,053,379

  

Chesapeake Funding II LLC 2023-1A1

  

05/15/35

  

5.650

 

  

 

11,027,307

 

8,205,687

  

Chesapeake Funding II LLC 2023-2A1

  

10/15/35

  

6.160

 

  

 

8,239,933

 

25,000,000

  

Churchill MMSLF CLO-I LP 2021-2A (3-Month CME Term SOFR + 1.712%)1,2

  

10/01/32

  

7.018

 

  

 

25,005,617

 

6,470,000

  

Credit Acceptance Auto Loan Trust 2023-1A1

  

07/15/33

  

7.710

 

  

 

6,591,882

 

11,645,000

  

Daimler Trucks Retail Trust 2023-1

  

03/15/27

  

5.900

 

  

 

11,690,560

 

12,445,000

  

Deerpath Capital CLO, Ltd. 2022-1A (3-Month CME Term SOFR + 1.950%)1,2

  

07/15/33

  

7.279

 

  

 

12,437,283

 

697,033

  

Donlen Fleet Lease Funding 2 LLC 2021-21

  

12/11/34

  

0.560

 

  

 

695,876

 

17,180,000

  

Dryden 93 CLO, Ltd. 2021-93A (3-Month CME Term SOFR + 1.342%)1,2

  

01/15/34

  

6.670

 

  

 

17,183,175

 

3,727,676

  

ECAF I, Ltd. 2015-1A1

  

06/15/40

  

3.473

 

  

 

2,460,177

 

6,169,170

  

Elm Trust 2020-3A1

  

08/20/29

  

2.954

 

  

 

5,905,087

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

3

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

    

ASSET BACKED SECURITIES (continued)

        

 

  

 

  

$

5,859,803

  

Enterprise Fleet Financing LLC 2022-11

  

01/20/28

  

3.030

%

  

$

5,784,521

 

9,207,648

  

Enterprise Fleet Financing LLC 2022-41

  

10/22/29

  

5.760

 

  

 

9,204,404

 

10,445,000

  

Enterprise Fleet Financing LLC 2023-31

  

03/20/30

  

6.400

 

  

 

10,548,550

 

916,655

  

FCI Funding LLC 2021-1A1

  

04/15/33

  

1.130

 

  

 

912,875

 

11,912,961

  

Finance of America HECM Buyout 2022-HB11,2,3

  

02/25/32

  

2.695

 

  

 

11,611,430

 

50,300,000

  

Flexential Issuer 2021-1A1

  

11/27/51

  

3.250

 

  

 

45,529,623

 

9,425,061

  

FNA LLC 2019-11,2,3,4

  

12/10/31

  

3.000

 

  

 

8,887,832

 

10,940,000

  

Ford Credit Floorplan Master Owner Trust A 2023-11

  

05/15/28

  

4.920

 

  

 

10,805,173

 

16,420,000

  

Foursight Capital Automobile Receivables Trust 2024-11

  

01/16/29

  

5.490

 

  

 

16,339,723

 

17,272,614

  

Global SC Finance VII Srl 2020-1A1

  

10/17/40

  

2.170

 

  

 

15,892,959

 

17,838,917

  

Global SC Finance VII Srl 2020-2A1

  

11/19/40

  

2.260

 

  

 

16,369,796

 

10,900,000

  

GM Financial Revolving Receivables Trust 2023-21

  

08/11/36

  

5.770

 

  

 

11,046,092

 

50,193,437

  

Golub Capital Partners ABS Funding, Ltd. 2021-2A1

  

10/19/29

  

2.944

 

  

 

46,302,833

 

8,300,000

  

HPEFS Equipment Trust 2023-2A1

  

01/21/31

  

6.040

 

  

 

8,320,972

 

17,344,688

  

HTS Fund I LLC 2021-11

  

08/25/36

  

1.411

 

  

 

15,038,450

 

9,275,000

  

Kubota Credit Owner Trust 2024-1A1

  

07/17/28

  

5.190

 

  

 

9,199,530

 

7,365,656

  

LCM XXIV, Ltd. 24A (3-Month CME Term SOFR + 1.242%)1,2

  

03/20/30

  

6.566

 

  

 

7,378,804

 

5,306,755

  

Mariner Finance Issuance Trust 2020-AA1

  

08/21/34

  

2.190

 

  

 

5,239,077

 

14,800,000

  

Mariner Finance Issuance Trust 2023-AA1

  

10/22/35

  

6.700

 

  

 

14,912,098

 

41,880,000

  

Monroe Capital Income Plus ABS Funding LLC 2022-1A1

  

04/30/32

  

4.050

 

  

 

38,071,676

 

12,410,000

  

Monroe Capital Mml CLO X, Ltd. 2020-1A (3-Month CME Term SOFR + 1.870%)1,2

  

05/20/34

  

7.189

 

  

 

12,404,873

 

47,600,000

  

Neuberger Berman Loan Advisers CLO 34, Ltd. 2019-34A (3-Month CME Term SOFR + 1.240%)1,2

  

01/20/35

  

6.565

 

  

 

47,644,549

 

17,690,000

  

NextGear Floorplan Master Owner Trust 2022-1A1

  

03/15/27

  

2.800

 

  

 

17,223,561

 

24,520,000

  

NextGear Floorplan Master Owner Trust 2024-1A1

  

03/15/29

  

5.120

 

  

 

24,289,519

 

6,235,000

  

Nissan Auto Receivables Owner Trust 2023-B

  

03/15/28

  

5.930

 

  

 

6,276,747

 

7,702,176

  

NMEF Funding LLC 2022-A1

  

10/16/28

  

2.580

 

  

 

7,635,172

 

14,424,325

  

NMEF Funding LLC 2023-A1

  

06/17/30

  

6.570

 

  

 

14,490,625

 

30,000,000

  

Northwoods Capital XVIII, Ltd. 2019-18A (3-Month CME Term SOFR + 1.362%)1,2

  

05/20/32

  

6.681

 

  

 

30,029,076

 

32,920,000

  

Octagon Investment Partners 20-R, Ltd. 2019-4A (3-Month CME Term SOFR + 1.412%)1,2

  

05/12/31

  

6.713

 

  

 

32,974,295

 

21,250,000

  

OnDeck Asset Securitization Trust III LLC 2021-1A1

  

05/17/27

  

1.590

 

  

 

21,199,215

 

14,337,000

  

OnDeck Asset Securitization Trust IV LLC 2023-1A1

  

08/19/30

  

7.000

 

  

 

14,211,666

 

14,640,000

  

OneMain Financial Issuance Trust 2022-3A1

  

05/15/34

  

5.940

 

  

 

14,654,633

The accompanying notes are an integral part of these financial statements.

4

    

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

    

ASSET BACKED SECURITIES (continued)

        

 

  

 

  

$

13,350,000

  

OneMain Financial Issuance Trust 2022-S11

  

05/14/35

  

4.130

%

  

$

13,001,628

 

16,380,000

  

OneMain Financial Issuance Trust 2023-2A1

  

09/15/36

  

5.840

 

  

 

16,464,442

 

56,210,000

  

Oportun Issuance Trust 2021-C1

  

10/08/31

  

2.180

 

  

 

52,979,949

 

25,000,000

  

Oportun Issuance Trust 2022-A1

  

06/09/31

  

5.050

 

  

 

24,775,303

 

25,271,984

  

Oxford Finance Funding LLC 2022-1A1

  

02/15/30

  

3.602

 

  

 

24,119,567

 

27,376,782

  

Palmer Square Loan Funding, Ltd. 2022-1A (3-Month CME Term SOFR + 1.050%)1,2

  

04/15/30

  

6.379

 

  

 

27,388,918

 

16,357,353

  

Parliament CLO II, Ltd. 2021-2A (3-Month CME Term SOFR + 1.612%)1,2

  

08/20/32

  

6.931

 

  

 

16,357,752

 

47,670,000

  

PFS Financing Corp. 2022-A1

  

02/15/27

  

2.470

 

  

 

46,408,261

 

19,980,000

  

PFS Financing Corp. 2022-C1

  

05/15/27

  

3.890

 

  

 

19,604,126

 

9,810,000

  

PFS Financing Corp. 2023-A1

  

03/15/28

  

5.800

 

  

 

9,837,713

 

31,020,000

  

Purchasing Power Funding LLC 2024-A1

  

08/15/28

  

5.890

 

  

 

30,780,578

 

7,748,441

  

Regional Management Issuance Trust 2020-11

  

10/15/30

  

2.340

 

  

 

7,622,244

 

6,234,904

  

Republic Finance Issuance Trust 2020-A1

  

11/20/30

  

2.470

 

  

 

6,171,501

 

56,030,000

  

Republic Finance Issuance Trust 2021-A1

  

12/22/31

  

2.300

 

  

 

53,565,319

 

23,320,000

  

Retained Vantage Data Centers Issuer LLC 2023-1A1

  

09/15/48

  

5.000

 

  

 

22,084,616

 

2,178,018

  

Santander Drive Auto Receivables Trust 2023-2

  

03/16/26

  

5.870

 

  

 

2,178,950

 

12,961,932

  

Santander Drive Auto Receivables Trust 2023-5

  

07/15/27

  

6.310

 

  

 

12,991,843

 

34,490,000

  

Santander Revolving Auto Loan Trust 2019-A1

  

01/26/32

  

2.510

 

  

 

33,821,905

 

7,498,189

  

Shenton Aircraft Investment I, Ltd. 2015-1A1

  

10/15/42

  

4.750

 

  

 

7,010,957

 

24,210,000

  

Sotheby’s Artfi Master Trust 2024-1A1

  

12/22/31

  

6.430

 

  

 

24,196,297

 

22,755,000

  

Southwick Park CLO LLC 2019-4A (3-Month CME Term SOFR + 1.322%)1,2

  

07/20/32

  

6.646

 

  

 

22,755,196

 

19,160,000

  

Stack Infrastructure Issuer LLC 2020-1A1

  

08/25/45

  

1.893

 

  

 

18,003,826

 

6,357,790

  

SWC Funding LLC 2018-1A1

  

08/15/33

  

4.750

 

  

 

6,349,475

 

50,790,000

  

Symphony CLO XXI, Ltd. 2019-21A (3-Month CME Term SOFR + 1.322%)1,2

  

07/15/32

  

6.650

 

  

 

50,826,422

 

12,760,000

  

Synchrony Card Funding LLC 2022-A1

  

04/15/28

  

3.370

 

  

 

12,485,028

 

13,310,000

  

TierPoint Issuer LLC 2023-1A1

  

06/25/53

  

6.000

 

  

 

12,778,614

 

12,345,000

  

T-Mobile US Trust 2024-1A1

  

09/20/29

  

5.050

 

  

 

12,240,701

 

12,920,000

  

Vantage Data Centers Issuer LLC 2023-1A1

  

03/16/48

  

6.316

 

  

 

12,811,591

 

613,282

  

Veros Auto Receivables Trust 2022-11

  

12/15/25

  

3.470

 

  

 

612,429

 

3,303,623

  

VFI ABS LLC 2022-1A1

  

03/24/28

  

2.230

 

  

 

3,268,868

 

6,315,400

  

VFI ABS LLC 2023-1A1

  

03/26/29

  

7.270

 

  

 

6,330,788

 

7,040,000

  

Westlake Automobile Receivables Trust 2023-4A1

  

11/15/28

  

6.640

 

  

 

7,116,295

 

12,135,244

  

Wheels Fleet Lease Funding 1 LLC 2022-1A1

  

10/18/36

  

2.470

 

  

 

12,066,301

 

18,550,000

  

Wheels Fleet Lease Funding 1 LLC 2023-1A1

  

04/18/38

  

5.800

 

  

 

18,536,529

 

12,000,000

  

Wheels Fleet Lease Funding 1 LLC 2023-2A1

  

08/18/38

  

6.460

 

  

 

12,073,734

 

11,295,000

  

World Financial Network Credit Card Master Trust 2023-A

  

03/15/30

  

5.020

 

  

 

11,131,076

 

    

Total Asset Backed Securities
(Cost $1,619,912,394)

        

 

  

 

1,583,948,731

 

              

 

  

 

  

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

5

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

    

COMMERCIAL MORTGAGE BACKED SECURITIES (6.0%)

        

 

  

 

  

$

26,807,000

  

BB-UBS Trust 2012-TFT1,2,3

  

06/05/30

  

3.559

%

  

$

21,463,646

 

9,350,000

  

BLP Commercial Mortgage Trust 2023-IND (1-Month CME Term SOFR + 1.692%)1,2

  

03/15/40

  

7.013

 

  

 

9,361,688

 

20,300,000

  

BPR Trust 2022-OANA (1-Month CME Term
SOFR + 1.898%)1,2

  

04/15/37

  

7.219

 

  

 

20,388,813

 

18,100,000

  

BX Commercial Mortgage Trust 2022-CSMO (1-Month CME Term SOFR + 2.115%)1,2

  

06/15/27

  

7.436

 

  

 

18,167,875

 

43,914,830

  

BX Commercial Mortgage Trust 2022-LP2 (1-Month CME Term SOFR + 1.013%)1,2

  

02/15/39

  

6.334

 

  

 

43,705,203

 

19,954,560

  

BXMT, Ltd. 2020-FL2 (1-Month CME Term
SOFR + 1.014%)1,2

  

02/15/38

  

6.331

 

  

 

19,140,950

 

16,217,622

  

BXMT, Ltd. 2020-FL3 (1-Month CME Term
SOFR + 1.514%)1,2

  

11/15/37

  

6.831

 

  

 

15,768,860

 

16,609,136

  

BXMT, Ltd. 2021-FL4 (1-Month CME Term
SOFR + 1.164%)1,2

  

05/15/38

  

6.481

 

  

 

15,778,679

 

31,329,000

  

CG-CCRE Commercial Mortgage Trust 2014-FL2 (1-Month CME Term SOFR + 3.014%)1,2

  

11/15/31

  

8.335

 

  

 

25,157,976

 

11,715,000

  

Commercial Mortgage Pass Through Certificate1

  

07/12/28

  

7.121

 

  

 

12,016,915

 

20,885,000

  

DK Trust 2024-SPBX (1-Month CME Term
SOFR + 1.500%)1,2

  

03/15/34

  

6.821

 

  

 

20,858,894

 

14,946,810

  

HPLY Trust 2019-HIT (1-Month CME Term
SOFR + 1.114%)1,2

  

11/15/36

  

6.436

 

  

 

14,900,101

 

23,600,000

  

Life Mortgage Trust 2022-BMR2 (1-Month CME Term SOFR + 1.295%)1,2

  

05/15/39

  

6.616

 

  

 

23,305,000

 

17,953,835

  

Med Trust 2021-MDLN (1-Month CME Term
SOFR + 1.064%)1,2

  

11/15/38

  

6.385

 

  

 

17,875,287

 

28,261,755

  

MHC Commercial Mortgage Trust 2021-MHC (1-Month CME Term SOFR + 0.915%)1,2

  

04/15/38

  

6.236

 

  

 

28,085,119

 

16,040,000

  

MTN Commercial Mortgage Trust 2022-LPFL (1-Month CME Term SOFR + 1.397%)1,2

  

03/15/39

  

6.727

 

  

 

15,789,375

 

17,543,704

  

Ready Capital Mortgage Financing LLC 2022-FL8 (30-Day SOFR + 1.650%)1,2

  

01/25/37

  

6.980

 

  

 

17,477,040

 

46,350,000

  

SPGN Mortgage Trust 2022-TFLM (1-Month CME Term SOFR + 1.550%)1,2

  

02/15/39

  

6.871

 

  

 

45,931,789

 

1,155,473

  

STWD, Ltd. 2019-FL1 (1-Month CME Term
SOFR + 1.194%)1,2

  

07/15/38

  

6.515

 

  

 

1,149,682

 

24,300,000

  

Taubman Centers Commercial Mortgage Trust 2022-DPM (1-Month CME Term SOFR + 2.186%)1,2

  

05/15/37

  

7.507

 

  

 

24,436,688

 

20,000,000

  

WMRK Commercial Mortgage Trust 2022-WMRK (1-Month CME Term SOFR + 2.789%)1,2

  

11/15/27

  

8.110

 

  

 

20,100,000

 

    

Total Commercial Mortgage Backed Securities
(Cost $444,323,227)

        

 

  

 

430,859,580

The accompanying notes are an integral part of these financial statements.

6

    

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

    

CORPORATE BONDS (43.5%)

        

 

  

 

  

 

    

AEROSPACE/DEFENSE (0.2%)

        

 

  

 

  

$

11,105,000

  

BAE Systems, Plc.1

  

03/26/27

  

5.000

%

  

$

10,945,080

 

              

 

  

 

  

 

    

AGRICULTURE (0.0%)

        

 

  

 

  

 

1,250,000

  

Cargill, Inc.1

  

02/02/31

  

1.700

 

  

 

995,506

 

              

 

  

 

  

 

    

APPAREL (0.0%)

        

 

  

 

  

 

1,000,000

  

Tapestry, Inc.

  

11/27/26

  

7.000

 

  

 

1,019,126

 

1,000,000

  

VF Corp.

  

04/23/25

  

2.400

 

  

 

964,599

 

              

 

  

 

1,983,725

 

    

AUTO MANUFACTURERS (1.6%)

        

 

  

 

  

 

16,000,000

  

Daimler Truck Finance North America LLC1

  

01/17/25

  

5.200

 

  

 

15,930,211

 

1,000,000

  

Ford Motor Credit Co. LLC

  

02/10/25

  

2.300

 

  

 

971,773

 

23,920,000

  

General Motors Financial Co., Inc.

  

04/06/26

  

5.400

 

  

 

23,770,144

 

9,175,000

  

Hyundai Capital America1

  

11/03/25

  

6.250

 

  

 

9,213,857

 

1,000,000

  

Hyundai Capital America1

  

01/08/26

  

1.300

 

  

 

927,034

 

11,055,000

  

Hyundai Capital America1

  

03/30/26

  

5.500

 

  

 

10,986,012

 

13,795,000

  

Hyundai Capital America1

  

06/26/26

  

5.650

 

  

 

13,735,363

 

11,580,000

  

Hyundai Capital America1

  

01/08/27

  

5.250

 

  

 

11,442,809

 

25,455,000

  

Mercedes-Benz Finance North America LLC1

  

03/30/26

  

4.800

 

  

 

25,144,846

 

              

 

  

 

112,122,049

 

    

BANKS (13.0%)

        

 

  

 

  

 

17,000,000

  

Banco Santander S.A. (1-Year CMT Index + 1.250%)2

  

03/14/28

  

5.552

 

  

 

16,791,359

 

30,000,000

  

Bank of America Corp. (SOFR + 1.340%)2

  

09/15/27

  

5.933

 

  

 

30,139,540

 

1,000,000

  

Bank of America Corp. (3-Month CME Term SOFR + 1.774%)2

  

04/24/28

  

3.705

 

  

 

946,918

 

51,125,000

  

Bank of Montreal

  

01/10/25

  

1.500

 

  

 

49,679,333

 

1,000,000

  

Bank of New York Mellon Corp. (SOFR + 1.802%)2

  

10/25/28

  

5.802

 

  

 

1,013,488

 

19,870,000

  

Bank of New Zealand1

  

02/07/28

  

4.846

 

  

 

19,403,807

 

9,500,000

  

Bank of New Zealand1

  

01/30/29

  

5.076

 

  

 

9,332,458

 

32,500,000

  

Bank of Nova Scotia (SOFR + 0.380%)2

  

07/31/24

  

5.736

 

  

 

32,513,617

 

15,015,000

  

Bank of Nova Scotia

  

01/10/25

  

1.450

 

  

 

14,587,698

 

16,915,000

  

Canadian Imperial Bank of Commerce

  

10/02/26

  

5.926

 

  

 

17,073,083

 

19,725,000

  

Canadian Imperial Bank of Commerce

  

04/28/28

  

5.001

 

  

 

19,329,430

 

1,000,000

  

Citigroup, Inc. (SOFR + 1.528%)2

  

03/17/26

  

3.290

 

  

 

976,997

 

33,540,000

  

Commonwealth Bank of Australia (SOFR + 0.400%)1,2

  

07/07/25

  

5.753

 

  

 

33,568,424

 

1,000,000

  

Discover Bank

  

07/27/26

  

3.450

 

  

 

944,939

 

65,000,000

  

DNB Bank ASA (1-Year CMT Index + 0.330%)1,2

  

09/30/25

  

0.856

 

  

 

63,623,171

 

1,000,000

  

Fifth Third Bancorp (SOFR + 2.192%)2

  

10/27/28

  

6.361

 

  

 

1,008,076

 

1,000,000

  

Goldman Sachs Group, Inc. (SOFR + 1.114%)2

  

02/24/28

  

2.640

 

  

 

922,409

 

33,350,000

  

HSBC Holdings, Plc. (SOFR + 1.929%)2

  

06/04/26

  

2.099

 

  

 

31,964,886

 

5,780,000

  

HSBC Holdings, Plc. (SOFR + 3.030%)2

  

11/03/26

  

7.336

 

  

 

5,909,759

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

7

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

  

CORPORATE BONDS (continued)

        

 

  

 

  

 

  

BANKS (continued)

        

 

  

 

  

$

25,640,000

  

HSBC Holdings, Plc. (SOFR + 1.570%)2

  

08/14/27

  

5.887

%

  

$

25,661,946

 

18,414,000

  

Huntington Bancshares, Inc. (SOFR + 1.970%)2

  

08/04/28

  

4.443

 

  

 

17,640,564

 

24,145,000

  

Huntington National Bank (SOFR + 1.215%)2

  

11/18/25

  

5.699

 

  

 

24,002,334

 

1,000,000

  

Huntington National Bank (SOFR + 1.650%)2

  

05/17/28

  

4.552

 

  

 

963,044

 

33,270,000

  

JPMorgan Chase & Co. (3-Month CME Term SOFR + 1.585%)2

  

03/13/26

  

2.005

 

  

 

32,184,297

 

1,000,000

  

JPMorgan Chase & Co. (SOFR + 1.850%)2

  

04/22/26

  

2.083

 

  

 

964,119

 

1,000,000

  

KeyBank NA

  

08/08/25

  

4.150

 

  

 

970,708

 

18,760,000

  

KeyBank NA

  

11/15/27

  

5.850

 

  

 

18,420,390

 

24,865,000

  

Lloyds Banking Group, Plc. (1-Year CMT Index + 1.600%)2

  

03/18/26

  

3.511

 

  

 

24,318,214

 

17,755,000

  

Lloyds Banking Group, Plc. (1-Year CMT Index + 1.800%)2

  

03/18/28

  

3.750

 

  

 

16,818,404

 

1,000,000

  

Manufacturers & Traders Trust Co.

  

01/27/28

  

4.700

 

  

 

946,728

 

39,660,000

  

Mitsubishi UFJ Financial Group, Inc.

  

07/17/25

  

1.412

 

  

 

37,684,414

 

42,665,000

  

Morgan Stanley (SOFR + 1.770%)2

  

10/16/26

  

6.138

 

  

 

42,900,510

 

1,000,000

  

Morgan Stanley2,3

  

07/22/28

  

3.591

 

  

 

940,972

 

1,000,000

  

PNC Bank NA

  

07/26/28

  

4.050

 

  

 

936,815

 

15,190,000

  

PNC Financial Services Group, Inc. (SOFR + 1.322%)2

  

06/12/26

  

5.812

 

  

 

15,193,137

 

25,345,000

  

PNC Financial Services Group, Inc. (SOFR + 1.730%)2

  

10/20/27

  

6.615

 

  

 

25,898,710

 

1,000,000

  

Regions Financial Corp.

  

05/18/25

  

2.250

 

  

 

963,255

 

24,915,000

  

Royal Bank of Canada

  

08/03/27

  

4.240

 

  

 

24,086,244

 

16,070,000

  

Santander Holdings USA, Inc.

  

06/07/24

  

3.500

 

  

 

16,063,931

 

1,000,000

  

Santander Holdings USA, Inc. (SOFR + 1.249%)2

  

01/06/28

  

2.490

 

  

 

906,137

 

26,360,000

  

Skandinaviska Enskilda Banken AB1

  

09/09/24

  

0.650

 

  

 

25,866,863

 

11,875,000

  

Skandinaviska Enskilda Banken AB1

  

03/05/29

  

5.375

 

  

 

11,672,297

 

10,085,000

  

State Street Corp. (SOFR + 1.353%)2

  

11/04/26

  

5.751

 

  

 

10,094,077

 

1,000,000

  

Synchrony Bank

  

08/22/25

  

5.400

 

  

 

987,329

 

14,435,000

  

Truist Financial Corp. (SOFR + 1.626%)2

  

10/28/26

  

5.900

 

  

 

14,427,693

 

1,000,000

  

Truist Financial Corp. (SOFR + 1.435%)2

  

01/26/29

  

4.873

 

  

 

969,861

 

53,570,000

  

UBS Group AG (1-Year CMT Index + 1.550%)1,2

  

01/12/27

  

5.711

 

  

 

53,429,996

 

42,990,000

  

US Bancorp (5-Year CMT Index + 2.541%)2,4

      

3.700

 

  

 

36,996,313

 

22,750,000

  

US Bancorp (SOFR + 1.430%)2

  

10/21/26

  

5.727

 

  

 

22,742,276

 

1,000,000

  

US Bancorp (SOFR + 2.020%)2

  

06/12/29

  

5.775

 

  

 

1,001,978

 

19,370,000

  

Wells Fargo & Co. (SOFR + 2.000%)2

  

04/30/26

  

2.188

 

  

 

18,675,363

 

7,920,000

  

Wells Fargo & Co. (SOFR + 1.560%)2

  

08/15/26

  

4.540

 

  

 

7,793,465

 

1,000,000

  

Wells Fargo & Co. (3-Month CME Term SOFR + 4.032%)2

  

04/04/31

  

4.478

 

  

 

939,649

 

26,655,000

  

Westpac Banking Corp.

  

11/18/27

  

5.457

 

  

 

26,817,051

 

30,895,000

  

Westpac New Zealand, Ltd.1

  

02/15/28

  

4.902

 

  

 

30,244,835

 

              

 

  

 

940,853,311

The accompanying notes are an integral part of these financial statements.

8

    

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

  

CORPORATE BONDS (continued)

        

 

  

 

  

 

    

BEVERAGES (0.4%)

        

 

  

 

  

$

8,175,000

  

Constellation Brands, Inc.

  

05/09/24

  

3.600

%

  

$

8,170,697

 

21,670,000

  

Keurig Dr Pepper, Inc.

  

03/15/27

  

5.100

 

  

 

21,519,075

 

              

 

  

 

29,689,772

 

    

BIOTECHNOLOGY (0.0%)

        

 

  

 

  

 

1,000,000

  

Baxalta, Inc.

  

06/23/25

  

4.000

 

  

 

980,994

 

1,000,000

  

Illumina, Inc.

  

12/13/27

  

5.750

 

  

 

999,922

 

              

 

  

 

1,980,916

 

    

BUILDING MATERIALS (0.0%)

        

 

  

 

  

 

1,000,000

  

CRH America, Inc.1

  

05/18/25

  

3.875

 

  

 

979,181

 

              

 

  

 

  

 

    

COMPUTERS (0.0%)

        

 

  

 

  

 

600,000

  

Genpact Luxembourg S.a.r.l.

  

12/01/24

  

3.375

 

  

 

589,892

 

              

 

  

 

  

 

    

COSMETICS/PERSONAL CARE (0.0%)

        

 

  

 

  

 

1,000,000

  

Estee Lauder Cos, Inc.

  

04/15/30

  

2.600

 

  

 

862,386

 

              

 

  

 

  

 

    

DIVERSIFIED FINANCIAL SERVICES (3.0%)

        

 

  

 

  

 

19,638,000

  

AerCap Ireland Capital DAC / AerCap Global Aviation Trust

  

04/15/27

  

6.450

 

  

 

20,019,752

 

1,000,000

  

American Express Co. (SOFR + 0.999%)2

  

05/01/26

  

4.990

 

  

 

991,966

 

20,960,000

  

American Express Co. (SOFR + 0.750%)2

  

04/23/27

  

5.645

 

  

 

20,964,908

 

34,045,000

  

Aviation Capital Group LLC1

  

12/15/24

  

5.500

 

  

 

33,867,602

 

33,535,000

  

Avolon Holdings Funding, Ltd.1

  

01/15/26

  

5.500

 

  

 

33,041,707

 

10,000,000

  

Capital One Financial Corp. (SOFR + 2.440%)2

  

10/29/27

  

7.149

 

  

 

10,290,838

 

1,000,000

  

Capital One Financial Corp. (SOFR + 2.080%)2

  

02/01/29

  

5.468

 

  

 

982,355

 

2,785,000

  

Credit Acceptance Corp.

  

03/15/26

  

6.625

 

  

 

2,776,560

 

18,620,000

  

Credit Acceptance Corp.1

  

12/15/28

  

9.250

 

  

 

19,741,855

 

48,895,000

  

Drawbridge Special Opportunities Fund LP / Drawbridge Special Opportunities Finance1

  

02/15/26

  

3.875

 

  

 

46,101,425

 

1,000,000

  

Enact Holdings, Inc.1

  

08/15/25

  

6.500

 

  

 

999,100

 

25,095,000

  

Strategic Credit Opportunities Partners LLC

  

04/01/26

  

4.250

 

  

 

23,495,896

 

1,000,000

  

Western Union Co.

  

01/10/25

  

2.850

 

  

 

978,654

 

              

 

  

 

214,252,618

 

    

ELECTRIC (2.0%)

        

 

  

 

  

 

500,000

  

AES Corp.1

  

07/15/25

  

3.300

 

  

 

484,213

 

1,000,000

  

Appalachian Power Co.

  

04/01/31

  

2.700

 

  

 

823,312

 

1,000,000

  

Atlantic City Electric Co.

  

03/15/31

  

2.300

 

  

 

819,275

 

1,000,000

  

Avangrid, Inc.

  

04/15/25

  

3.200

 

  

 

975,029

 

1,000,000

  

Black Hills Corp.

  

06/15/30

  

2.500

 

  

 

818,370

 

16,025,000

  

Constellation Energy Generation LLC

  

06/01/25

  

3.250

 

  

 

15,608,238

 

1,000,000

  

DTE Energy Co.

  

06/01/25

  

1.050

 

  

 

950,384

 

1,000,000

  

Duke Energy Ohio, Inc.

  

06/01/30

  

2.125

 

  

 

826,077

 

39,737,382

  

Duke Energy Progress NC Storm Funding LLC

  

07/01/30

  

1.295

 

  

 

36,271,212

 

61,690,000

  

Edison International (5-Year CMT Index + 4.698%)2,5

      

5.375

 

  

 

59,098,705

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

9

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

  

CORPORATE BONDS (continued)

        

 

  

 

  

 

    

ELECTRIC (continued)

        

 

  

 

  

$

1,000,000

  

Edison International

  

11/15/29

  

6.950

%

  

$

1,050,067

 

1,000,000

  

Entergy Louisiana LLC

  

12/15/30

  

1.600

 

  

 

783,210

 

1,000,000

  

Evergy Missouri West, Inc.1

  

12/15/27

  

5.150

 

  

 

984,879

 

1,000,000

  

Fells Point Funding Trust1

  

01/31/27

  

3.046

 

  

 

930,180

 

1,000,000

  

FirstEnergy Pennsylvania Electric Co.1

  

03/30/26

  

5.150

 

  

 

985,472

 

1,000,000

  

Narragansett Electric Co.1

  

04/09/30

  

3.395

 

  

 

893,191

 

1,000,000

  

National Rural Utilities Cooperative Finance Corp.

  

03/15/30

  

2.400

 

  

 

844,149

 

1,000,000

  

NextEra Energy Capital Holdings, Inc.

  

06/20/25

  

4.450

 

  

 

985,802

 

1,000,000

  

NRG Energy, Inc.1

  

12/02/25

  

2.000

 

  

 

935,661

 

1,000,000

  

Pacific Gas & Electric Co.

  

01/01/26

  

3.150

 

  

 

956,022

 

1,000,000

  

PacifiCorp

  

09/15/30

  

2.700

 

  

 

844,298

 

18,615,000

  

Public Service Enterprise Group, Inc.

  

10/15/28

  

5.875

 

  

 

18,794,919

 

1,000,000

  

Vistra Operations Co. LLC1

  

05/13/25

  

5.125

 

  

 

985,003

 

              

 

  

 

146,647,668

 

    

ENERGY-ALTERNATE SOURCES (0.4%)

        

 

  

 

  

 

25,000,000

  

NextEra Energy Partners LP1,6

  

06/15/24

  

0.000

 

  

 

24,762,500

 

              

 

  

 

  

 

    

FOOD (0.9%)

        

 

  

 

  

 

1,000,000

  

Campbell Soup Co.

  

03/15/25

  

3.950

 

  

 

984,200

 

15,535,000

  

General Mills, Inc.

  

10/17/28

  

5.500

 

  

 

15,569,091

 

12,590,000

  

Hormel Foods Corp.

  

03/30/27

  

4.800

 

  

 

12,447,193

 

1,000,000

  

Mars, Inc.1

  

04/20/28

  

4.550

 

  

 

973,295

 

21,220,000

  

Nestle Capital Corp.1

  

03/12/29

  

4.650

 

  

 

20,730,934

 

11,460,000

  

Sysco Corp.

  

01/17/29

  

5.750

 

  

 

11,575,851

 

              

 

  

 

62,280,564

 

    

GAS (0.0%)

        

 

  

 

  

 

1,000,000

  

Brooklyn Union Gas Co.1

  

08/05/27

  

4.632

 

  

 

960,123

 

265,000

  

East Ohio Gas Co.1

  

06/15/25

  

1.300

 

  

 

251,885

 

1,000,000

  

Southern California Gas Co.

  

02/01/30

  

2.550

 

  

 

855,607

 

              

 

  

 

2,067,615

 

    

HEALTHCARE-PRODUCTS (0.3%)

        

 

  

 

  

 

22,215,000

  

Medtronic Global Holdings SCA

  

03/30/28

  

4.250

 

  

 

21,449,752

 

              

 

  

 

  

 

    

HEALTHCARE-SERVICES (1.6%)

        

 

  

 

  

 

1,000,000

  

Adventist Health System

  

03/01/29

  

2.952

 

  

 

882,522

 

1,000,000

  

CommonSpirit Health

  

10/01/25

  

1.547

 

  

 

940,744

 

1,000,000

  

Providence St Joseph Health Obligated Group

  

10/01/29

  

2.532

 

  

 

863,137

 

32,090,000

  

Roche Holdings, Inc.1

  

11/13/26

  

5.265

 

  

 

32,096,221

 

1,000,000

  

Roche Holdings, Inc.1

  

11/13/28

  

5.338

 

  

 

1,005,091

 

22,000,000

  

Roche Holdings, Inc.1

  

03/08/29

  

4.790

 

  

 

21,692,674

 

60,630,000

  

Sutter Health

  

08/15/25

  

1.321

 

  

 

57,259,150

 

              

 

  

 

114,739,539

 

    

HOME BUILDERS (0.0%)

        

 

  

 

  

 

1,000,000

  

DR Horton, Inc.

  

10/15/25

  

2.600

 

  

 

955,764

The accompanying notes are an integral part of these financial statements.

10

    

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

  

CORPORATE BONDS (continued)

        

 

  

 

  

 

    

INSURANCE (9.9%)

        

 

  

 

  

$

26,415,000

  

American Coastal Insurance Corp.

  

12/15/27

  

7.250

%

  

$

24,235,763

 

18,000,000

  

Athene Global Funding1

  

01/14/25

  

2.500

 

  

 

17,576,375

 

14,345,000

  

Athene Global Funding1

  

06/29/25

  

2.550

 

  

 

13,770,513

 

35,075,000

  

Athene Global Funding1

  

02/23/26

  

5.684

 

  

 

34,992,872

 

1,000,000

  

Athene Global Funding1

  

10/02/26

  

1.730

 

  

 

904,673

 

17,070,000

  

Athene Global Funding1

  

01/09/29

  

5.583

 

  

 

16,910,942

 

1,000,000

  

Brighthouse Financial Global Funding1

  

05/24/26

  

1.550

 

  

 

913,165

 

1,000,000

  

CNO Global Funding1

  

01/06/25

  

1.650

 

  

 

966,059

 

1,000,000

  

Corebridge Global Funding1

  

07/02/26

  

5.750

 

  

 

994,704

 

14,025,000

  

Corebridge Global Funding1

  

09/19/28

  

5.900

 

  

 

14,101,523

 

26,595,000

  

Equitable Financial Life Global Funding1

  

11/12/24

  

1.100

 

  

 

25,882,799

 

59,274,000

  

F&G Global Funding1

  

09/20/24

  

0.900

 

  

 

57,975,503

 

1,000,000

  

F&G Global Funding1

  

06/30/26

  

1.750

 

  

 

906,041

 

50,000,000

  

GA Global Funding Trust (SOFR + 0.500%)1,2

  

09/13/24

  

5.853

 

  

 

50,013,617

 

1,000,000

  

GA Global Funding Trust1

  

01/06/27

  

2.250

 

  

 

909,381

 

17,225,000

  

GA Global Funding Trust1

  

01/08/29

  

5.500

 

  

 

16,946,876

 

1,000,000

  

Guardian Life Global Funding1

  

12/10/25

  

0.875

 

  

 

928,347

 

1,000,000

  

Jackson National Life Global Funding1

  

01/12/25

  

1.750

 

  

 

969,396

 

1,230,000

  

MassMutual Global Funding II1

  

10/09/30

  

1.550

 

  

 

970,908

 

44,790,000

  

Met Tower Global Funding1

  

09/14/26

  

1.250

 

  

 

40,555,216

 

23,485,000

  

Met Tower Global Funding1

  

04/12/29

  

5.250

 

  

 

23,164,917

 

1,000,000

  

Metropolitan Life Global Funding I1

  

06/30/27

  

4.400

 

  

 

968,029

 

73,445,000

  

New York Life Global Funding1

  

01/14/25

  

1.450

 

  

 

71,349,277

 

1,000,000

  

New York Life Global Funding1

  

01/09/28

  

4.850

 

  

 

982,014

 

15,850,000

  

Northwestern Mutual Global Funding1

  

01/10/29

  

4.710

 

  

 

15,421,572

 

19,330,000

  

Pacific Life Global Funding II1

  

06/24/25

  

1.200

 

  

 

18,396,981

 

37,490,000

  

Pacific Life Global Funding II1

  

04/04/28

  

4.900

 

  

 

36,613,084

 

37,180,000

  

Pricoa Global Funding I1

  

12/06/24

  

1.150

 

  

 

36,187,653

 

47,175,000

  

Principal Life Global Funding II1

  

01/10/25

  

1.375

 

  

 

45,827,121

 

12,560,000

  

Principal Life Global Funding II1

  

01/16/27

  

5.000

 

  

 

12,428,766

 

1,000,000

  

Principal Life Global Funding II1

  

06/28/28

  

5.500

 

  

 

985,194

 

29,855,000

  

Protective Life Global Funding1

  

07/05/24

  

0.781

 

  

 

29,601,571

 

42,465,000

  

Protective Life Global Funding1

  

01/13/25

  

1.646

 

  

 

41,299,895

 

1,000,000

  

Protective Life Global Funding1

  

04/14/26

  

5.209

 

  

 

993,831

 

16,160,000

  

RGA Global Funding1

  

11/21/28

  

6.000

 

  

 

16,417,146

 

1,180,000

  

RGA Global Funding1

  

01/18/29

  

2.700

 

  

 

1,039,782

 

27,515,000

  

SiriusPoint, Ltd.

  

04/05/29

  

7.000

 

  

 

27,447,567

 

4,205,000

  

Universal Insurance Holdings, Inc.

  

11/30/26

  

5.625

 

  

 

3,929,425

 

11,950,000

  

Vitality Re XIII, Ltd. (3-Month U.S. Treasury Bill + 2.000%)1,2

  

01/06/26

  

7.387

 

  

 

11,859,180

 

              

 

  

 

716,337,678

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

11

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

  

CORPORATE BONDS (continued)

        

 

  

 

  

 

    

INVESTMENT COMPANIES (5.7%)

        

 

  

 

  

$

41,185,000

  

BlackRock TCP Capital Corp.

  

08/23/24

  

3.900

%

  

$

40,878,860

 

46,600,000

  

Blackstone Private Credit Fund

  

09/15/24

  

1.750

 

  

 

45,749,154

 

31,840,000

  

Blackstone Private Credit Fund

  

11/22/24

  

2.350

 

  

 

31,170,722

 

9,654,000

  

Blackstone Secured Lending Fund

  

01/15/26

  

3.625

 

  

 

9,206,468

 

10,000,000

  

Blue Owl Capital Corp.

  

03/30/25

  

4.000

 

  

 

9,798,623

 

6,028,000

  

Blue Owl Capital Corp. II1

  

11/26/24

  

4.625

 

  

 

5,971,041

 

18,000,000

  

Blue Owl Credit Income Corp.

  

09/23/26

  

3.125

 

  

 

16,459,397

 

20,015,000

  

Blue Owl Technology Finance Corp.1

  

12/15/25

  

4.750

 

  

 

19,192,648

 

18,375,000

  

Franklin BSP Lending Corp.1

  

12/15/24

  

4.850

 

  

 

18,147,523

 

26,475,000

  

Franklin BSP Lending Corp.

  

03/30/26

  

3.250

 

  

 

24,755,088

 

28,550,000

  

FS KKR Capital Corp.

  

07/15/24

  

4.625

 

  

 

28,438,144

 

18,859,000

  

FS KKR Capital Corp.

  

02/01/25

  

4.125

 

  

 

18,537,628

 

27,321,000

  

FS KKR Capital Corp.1

  

02/14/25

  

4.250

 

  

 

26,904,897

 

15,940,000

  

FS KKR Capital Corp.

  

01/15/26

  

3.400

 

  

 

15,070,417

 

49,650,000

  

Main Street Capital Corp.

  

05/01/24

  

5.200

 

  

 

49,650,000

 

33,980,000

  

Main Street Capital Corp.

  

07/14/26

  

3.000

 

  

 

31,643,775

 

17,345,000

  

PennantPark Investment Corp.

  

11/01/26

  

4.000

 

  

 

16,027,945

 

              

 

  

 

407,602,330

 

    

MACHINERY-CONSTRACTION & MINING (0.0%)

    

 

  

 

  

 

800,000

  

Caterpillar Financial Services Corp.

  

08/12/25

  

3.650

 

  

 

782,559

 

1,000,000

  

Komatsu Finance America, Inc.1

  

10/06/27

  

5.499

 

  

 

1,001,084

 

              

 

  

 

1,783,643

 

    

MACHINERY-DIVERSIFIED (0.5%)

        

 

  

 

  

 

1,000,000

  

CNH Industrial Capital LLC

  

05/23/25

  

3.950

 

  

 

979,738

 

10,920,000

  

CNH Industrial Capital LLC

  

01/12/29

  

5.500

 

  

 

10,882,572

 

27,185,000

  

CNH Industrial Capital LLC

  

04/20/29

  

5.100

 

  

 

26,602,315

 

              

 

  

 

38,464,625

 

    

METAL FABRICATE/HARDWARE (0.0%)

        

 

  

 

  

 

1,000,000

  

Precision Castparts Corp.

  

06/15/25

  

3.250

 

  

 

975,643

 

              

 

  

 

  

 

    

OIL & GAS (0.1%)

        

 

  

 

  

 

10,072,000

  

Woodside Finance, Ltd.1

  

09/15/26

  

3.700

 

  

 

9,574,740

 

              

 

  

 

  

 

    

PACKAGING & CONTAINERS (0.0%)

        

 

  

 

  

 

1,000,000

  

Amcor Flexibles North America, Inc.

  

05/17/25

  

4.000

 

  

 

979,895

 

              

 

  

 

  

 

    

PHARMACEUTICALS (0.5%)

        

 

  

 

  

 

22,745,000

  

CVS Health Corp.

  

02/20/26

  

5.000

 

  

 

22,517,975

 

12,815,000

  

McKesson Corp.

  

02/15/26

  

5.250

 

  

 

12,751,042

 

              

 

  

 

35,269,017

 

    

PIPELINES (0.7%)

        

 

  

 

  

 

1,000,000

  

Columbia Pipeline Group, Inc.

  

06/01/25

  

4.500

 

  

 

984,389

 

16,986,000

  

EnLink Midstream Partners LP

  

06/01/25

  

4.150

 

  

 

16,577,775

 

31,985,000

  

Northriver Midstream Finance LP1

  

02/15/26

  

5.625

 

  

 

31,310,110

 

              

 

  

 

48,872,274

The accompanying notes are an integral part of these financial statements.

12

    

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

  

CORPORATE BONDS (continued)

        

 

  

 

  

 

    

PRIVATE EQUITY (0.5%)

        

 

  

 

  

$

10,600,000

  

HAT Holdings I LLC / HAT Holdings II LLC1

  

04/15/25

  

6.000

%

  

$

10,543,509

 

23,540,000

  

HAT Holdings I LLC / HAT Holdings II LLC1

  

06/15/26

  

3.375

 

  

 

21,878,507

 

              

 

  

 

32,422,016

 

    

REAL ESTATE INVESTMENT TRUSTS (1.4%)

        

 

  

 

  

 

1,000,000

  

Agree LP

  

06/15/28

  

2.000

 

  

 

865,152

 

9,290,000

  

American Tower Trust #11

  

03/15/28

  

5.490

 

  

 

9,248,461

 

1,000,000

  

Boston Properties LP

  

10/01/26

  

2.750

 

  

 

925,627

 

25,360,000

  

EF Holdco / EF Cayman Hold / Ellington Finance REIT Cayman / TRS / EF Cayman Non-MTM1

  

04/01/27

  

5.875

 

  

 

23,839,851

 

1,000,000

  

Federal Realty OP LP

  

05/01/28

  

5.375

 

  

 

988,622

 

14,480,000

  

Realty Income Corp.

  

01/13/26

  

5.050

 

  

 

14,397,044

 

29,500,000

  

Rexford Industrial Realty LP

  

06/15/28

  

5.000

 

  

 

28,785,969

 

19,215,000

  

Scentre Group Trust 1 / Scentre Group Trust 21

  

01/28/26

  

3.625

 

  

 

18,534,434

 

1,000,000

  

VICI Properties LP / VICI Note Co., Inc.1

  

02/15/25

  

3.500

 

  

 

980,007

 

              

 

  

 

98,565,167

 

    

RETAIL (0.2%)

        

 

  

 

  

 

10,900,000

  

AutoZone, Inc.

  

11/01/28

  

6.250

 

  

 

11,232,886

 

              

 

  

 

  

 

    

SEMICONDUCTORS (0.2%)

        

 

  

 

  

 

16,565,000

  

ams-OSRAM AG1

  

03/30/29

  

12.250

 

  

 

16,575,436

 

              

 

  

 

  

 

    

TOYS/GAMES/HOBBIES (0.0%)

        

 

  

 

  

 

1,000,000

  

Hasbro, Inc.

  

11/19/24

  

3.000

 

  

 

984,312

 

              

 

  

 

  

 

    

TRUCKING & LEASING (0.4%)

        

 

  

 

  

 

1,000,000

  

Penske Truck Leasing Co. LP / PTL Finance Corp.1

  

07/15/25

  

4.000

 

  

 

977,167

 

31,000,000

  

Penske Truck Leasing Co. LP / PTL Finance Corp.1

  

05/01/28

  

5.550

 

  

 

30,799,884

 

              

 

  

 

31,777,051

 

    

Total Corporate Bonds
(Cost $3,208,685,064)

        

 

  

 

3,139,574,551

 

              

 

  

 

  

 

    

LOAN PARTICIPATIONS AND ASSIGNMENTS (11.9%)

        

 

  

 

  

 

28,868,000

  

AAdvantage Loyality IP, Ltd. (3-Month CME Term SOFR + 4.750%)2

  

04/20/28

  

10.336

 

  

 

29,995,584

 

21,374,594

  

Allen Media LLC (3-Month CME Term SOFR + 5.500%)2

  

02/10/27

  

10.959

 

  

 

19,032,366

 

20,519,831

  

Allspring Buyer LLC (3-Month CME Term SOFR + 3.250%)2

  

11/01/28

  

8.824

 

  

 

20,445,549

 

6,604,425

  

Allspring Buyer LLC (3-Month CME Term SOFR + 4.000%)2

  

11/01/28

  

9.313

 

  

 

6,602,113

 

46,096,869

  

Asplundh Tree Expert LLC (1-Month CME Term SOFR + 1.750%)2

  

09/07/27

  

7.166

 

  

 

46,128,676

 

4,479,557

  

Avantor Funding, Inc. Term B6 (1-Month CME Term SOFR + 2.000%)2

  

11/08/27

  

7.316

 

  

 

4,490,039

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

13

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

  

LOAN PARTICIPATIONS AND ASSIGNMENTS (continued)

        

 

  

 

  

$

35,222,779

  

Avolon TLB Borrower 1 (US) LLC Term B6 (1-Month CME Term SOFR + 2.000%)2

  

06/22/28

  

7.315

%

  

$

35,285,124

 

12,364,626

  

Axalta Coating Systems Dutch Holding B BV (Axalta Coating Systems U.S. Holdings, Inc.) Term B6 (3-Month CME Term SOFR + 2.000%)2

  

12/20/29

  

7.330

 

  

 

12,395,538

 

10,171,904

  

BCP Renaissance Parent LLC Term B4 (3-Month CME Term SOFR + 3.500%)2

  

10/31/28

  

8.829

 

  

 

10,207,505

 

23,219,844

  

Buckeye Partners LP Term B3 (1-Month CME Term SOFR + 2.000%)2

  

11/01/26

  

7.316

 

  

 

23,281,608

 

43,680,525

  

Charter Communications Operating LLC Term B4 (3-Month CME Term SOFR + 2.000%)2

  

12/07/30

  

7.302

 

  

 

43,052,836

 

40,795,663

  

Clean Harbors, Inc. (1-Month CME Term SOFR + 1.750%)2

  

10/08/28

  

7.180

 

  

 

40,897,652

 

13,032,317

  

Delos Aircraft Designated Activity Co. (3-Month CME Term SOFR + 2.000%)2

  

10/31/27

  

7.302

 

  

 

13,038,833

 

21,409,800

  

Eastern Power LLC (1-Month CME Term SOFR + 3.750%)2

  

10/02/25

  

9.180

 

  

 

21,359,058

 

44,842,136

  

Elanco Animal Health, Inc. (1-Month CME Term SOFR + 1.750%)2

  

08/01/27

  

7.177

 

  

 

44,737,654

 

2,615,506

  

Icon Plc. (1-Month CME Term SOFR + 2.000%)2

  

07/03/28

  

7.309

 

  

 

2,624,818

 

10,497,691

  

Icon Plc. (3-Month CME Term SOFR + 2.000%)2

  

07/03/28

  

7.309

 

  

 

10,535,063

 

15,099,474

  

Iqvia, Inc. Term A2 (3-Month CME Term SOFR + 1.250%)2

  

06/16/27

  

6.693

 

  

 

14,986,228

 

31,146,174

  

Iridium Satellite LLC Term B3 (1-Month CME Term SOFR + 2.500%)2

  

09/20/30

  

7.816

 

  

 

31,155,829

 

32,450,020

  

Jazz Pharmaceuticals Plc. Term B1 (1-Month CME Term SOFR + 3.000%)2

  

05/05/28

  

8.430

 

  

 

32,632,713

 

15,206,374

  

Lumen Technologies, Inc. Term A (1-Month CME Term SOFR + 6.000%)2

  

06/01/28

  

11.316

 

  

 

12,849,386

 

9,343,634

  

Lumen Technologies, Inc. Term B1 (1-Month CME Term SOFR + 2.350%)2

  

04/15/29

  

7.780

 

  

 

6,708,730

 

9,575,419

  

Lumen Technologies, Inc. Term B2 (1-Month CME Term SOFR + 2.350%)2

  

04/15/30

  

7.780

 

  

 

6,686,803

 

35,865,375

  

MPH Acquisition Holdings LLC (3-Month CME Term SOFR + 4.250%)2

  

09/01/28

  

9.855

 

  

 

33,117,011

 

10,710,000

  

NRG Energy, Inc. (3-Month CME Term SOFR + 2.000%)2

  

04/16/31

  

7.328

 

  

 

10,751,876

 

50,000,000

  

NVA Holdings Parent LLC (1-Month CME Term SOFR + 1.750%)2,4

  

12/15/25

  

7.180

 

  

 

49,270,000

 

45,548,888

  

Organon & Co. (1-Month CME Term SOFR + 3.000%)2

  

06/02/28

  

8.433

 

  

 

45,733,816

 

45,000,000

  

Relam Amsterdam Holdings BV Term A (6-Month Term SOFR + 1.750%)2,4

  

07/10/28

  

5.330

 

  

 

44,775,000

The accompanying notes are an integral part of these financial statements.

14

    

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

  

LOAN PARTICIPATIONS AND ASSIGNMENTS (continued)

        

 

  

 

  

$

15,000,000

  

Setanta Aircraft Leasing DAC (3-Month CME Term SOFR + 2.000%)2

  

11/05/28

  

7.564

%

  

$

15,033,750

 

19,317,395

  

SkyMiles IP, Ltd. (3-Month CME Term SOFR + 3.750%)2

  

10/20/27

  

9.075

 

  

 

19,898,848

 

10,384,440

  

SS&C Technologies Holdings, Inc. Term B3 (1-Month CME Term SOFR + 1.750%)2

  

04/16/25

  

7.180

 

  

 

10,381,948

 

9,087,149

  

SS&C Technologies Holdings, Inc. Term B4 (1-Month CME Term SOFR + 1.750%)2

  

04/16/25

  

7.180

 

  

 

9,084,968

 

7,504,534

  

SS&C Technologies Holdings, Inc. Term B5 (1-Month CME Term SOFR + 1.750%)2

  

04/16/25

  

7.180

 

  

 

7,502,958

 

15,352,941

  

UGI Corp. Term A2 (1-Month CME Term SOFR + 2.250%)2

  

05/05/25

  

7.668

 

  

 

15,334,518

 

17,138,581

  

UGI Energy Services LLC (1-Month CME Term SOFR + 3.250%)2

  

02/22/30

  

8.666

 

  

 

17,218,961

 

30,368,183

  

Vistra Operations Co. LLC (fka Tex Operations Co. LLC) (1-Month CME Term SOFR + 2.000%)2

  

12/20/30

  

7.316

 

  

 

30,381,849

 

3,250,000

  

Vontier Corp. (1-Month CME Term SOFR + 1.125%)2

  

10/28/24

  

6.555

 

  

 

3,246,100

 

55,552,419

  

Wynn Resorts, Ltd. Term A (1-Month CME Term SOFR + 1.750%)2,4

  

09/20/24

  

7.166

 

  

 

55,380,207

 

    

Total Loan Participations and Assignments
(Cost $861,255,454)

        

 

  

 

856,241,515

 

              

 

  

 

  

 

    

MUNICIPAL BONDS (0.4%)

        

 

  

 

  

 

31,000,000

  

Kentucky Public Energy Authority, Revenue Bonds (SOFR + 1.200%)2

  

08/01/52

  

4.764

 

  

 

30,297,301

 

    

Total Municipal Bonds
(Cost $31,000,000)

        

 

  

 

30,297,301

 

              

 

  

 

  

 

    

RESIDENTIAL MORTGAGE BACKED SECURITIES (0.3%)

        

 

  

 

  

 

3,622,013

  

Cascade Funding Mortgage Trust 2019-RM31,2,3

  

06/25/69

  

2.800

 

  

 

3,551,750

 

1,314,832

  

RESIMAC Premier 2020-1A (1-Month CME Term SOFR + 1.164%)1,2

  

02/07/52

  

6.486

 

  

 

1,314,837

 

3,532,291

  

RESIMAC Premier 2021-1A (1-Month CME Term SOFR + 0.814%)1,2

  

07/10/52

  

6.132

 

  

 

3,526,969

 

6,199,039

  

RMF Buyout Issuance Trust 2021-HB11,2,3

  

11/25/31

  

1.259

 

  

 

6,034,332

 

5,974,691

  

RMF Proprietary Issuance Trust 2019-11,2,3

  

10/25/63

  

2.750

 

  

 

5,059,746

 

    

Total Residential Mortgage Backed Securities
(Cost $20,599,964)

        

 

  

 

19,487,634

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

15

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

    

U.S. GOVERNMENT AGENCY OBLIGATIONS (0.9%)

        

 

  

 

  

$

25,000,000

  

Federal Home Loan Bank Discount Notes6

  

05/01/24

  

0.000

%

  

$

25,000,000

 

40,500,000

  

Federal Home Loan Mortgage Corp.

  

11/12/25

  

0.600

 

  

 

37,804,677

 

11,959

  

Federal Home Loan Mortgage Corp. (FHLMC) Non Gold Guaranteed (1-Year RFUCCT + 1.792%)2

  

04/01/36

  

4.733

 

  

 

11,890

 

11,887

  

Federal Home Loan Mortgage Corp. (FHLMC) Non Gold Guaranteed (6-Month RFUCCT + 1.740%)2

  

12/01/36

  

5.865

 

  

 

11,739

 

9,809

  

Federal Home Loan Mortgage Corp. (FHLMC) Non Gold Guaranteed (1-Year RFUCCT + 1.745%)2

  

01/01/37

  

5.995

 

  

 

9,787

 

2,266,029

  

Federal National Mortgage Association (FNMA)

  

07/01/35

  

5.000

 

  

 

2,212,714

 

137,237

  

Federal National Mortgage Association (FNMA)

  

11/01/35

  

5.500

 

  

 

136,636

 

17,478

  

Federal National Mortgage Association (FNMA) (1-Year RFUCCT + 1.938%)2

  

07/01/36

  

6.188

 

  

 

18,060

 

27,153

  

Federal National Mortgage Association (FNMA) (1-Year RFUCCT + 1.720%)2

  

09/01/36

  

5.970

 

  

 

27,292

 

20,844

  

Federal National Mortgage Association (FNMA) (1-Year RFUCCT + 1.728%)2

  

01/01/37

  

6.073

 

  

 

20,874

 

134,806

  

Federal National Mortgage Association (FNMA)

  

08/01/37

  

5.500

 

  

 

134,216

 

1,596,767

  

Federal National Mortgage Association (FNMA)

  

08/01/37

  

5.500

 

  

 

1,587,442

 

654,380

  

Federal National Mortgage Association (FNMA)

  

06/01/40

  

6.500

 

  

 

675,347

 

3,037

  

Government National Mortgage Association (GNMA) (1-Year CMT Index + 1.500%)2

  

08/20/29

  

3.625

 

  

 

2,972

 

    

Total U.S. Government Agency Obligations
(Cost $70,574,628)

        

 

  

 

67,653,646

 

              

 

  

 

  

 

    

U.S. TREASURY BILLS (14.1%)

        

 

  

 

  

 

2,700,000

  

U.S. Treasury Bill6

  

05/07/24

  

0.000

 

  

 

2,697,626

 

115,500,000

  

U.S. Treasury Bill6

  

05/09/24

  

0.000

 

  

 

115,365,373

 

3,750,000

  

U.S. Treasury Bill6

  

05/14/24

  

0.000

 

  

 

3,742,854

 

120,750,000

  

U.S. Treasury Bill6

  

05/16/24

  

0.000

 

  

 

120,487,204

 

112,750,000

  

U.S. Treasury Bill6

  

05/30/24

  

0.000

 

  

 

112,275,535

 

116,150,000

  

U.S. Treasury Bill6

  

06/04/24

  

0.000

 

  

 

115,572,398

 

108,250,000

  

U.S. Treasury Bill6

  

06/06/24

  

0.000

 

  

 

107,684,300

 

107,800,000

  

U.S. Treasury Bill6

  

06/13/24

  

0.000

 

  

 

107,124,810

 

127,450,000

  

U.S. Treasury Bill6

  

07/05/24

  

0.000

 

  

 

126,238,429

 

107,750,000

  

U.S. Treasury Bill6

  

07/16/24

  

0.000

 

  

 

106,556,908

 

100,000,000

  

U.S. Treasury Bill6

  

08/20/24

  

0.000

 

  

 

98,380,531

 

4,400,000

  

U.S. Treasury Bill6,7

  

10/10/24

  

0.000

 

  

 

4,297,463

 

    

Total U.S. Treasury Bills
(Cost $1,020,452,362)

        

 

  

 

1,020,423,431

The accompanying notes are an integral part of these financial statements.

16

    

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value

 

    

U.S. TREASURY BONDS AND NOTES (0.2%)

        

 

  

 

  

$

11,600,000

  

U.S. Treasury Note

  

01/31/26

  

4.250

%

  

$

11,436,422

3,250,000

  

U.S. Treasury Note

  

01/31/28

  

3.500

 

  

3,103,877

 

    

Total U.S. Treasury Bonds and Notes
(Cost $14,698,334)

        

 

  

14,540,299

 

      

 

  

 

  

 

TOTAL INVESTMENTS (Cost $7,291,501,427)8

  

99.2

%

  

$

7,163,026,688

 

CASH AND OTHER ASSETS IN EXCESS OF LIABILITIES

  

0.8

%

  

 

57,653,833

 

NET ASSETS

  

100.0

%

  

$

7,220,680,521

____________

​1  Security exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. Total market value of Rule 144A securities owned at April 30, 2024 was $3,473,610,724 or 48.1% of net assets.

​2   Variable rate instrument. Interest rates change on specific dates (such as coupon or interest payment date). The yield shown represents the April 30, 2024 coupon or interest rate.

​3  This variable rate security is based on a predetermined schedule and the rate at period end also represents the reference rate at period end.

​4  Security that used significant unobservable inputs to determine fair value.

​5  Security is perpetual in nature and has no stated maturity date.

​6  Security issued with zero coupon. Income is recognized through accretion of discount.

​7  All or a portion of this security is held at the broker as collateral for open futures contracts.

​8  The aggregate cost of investments and derivatives for federal income tax purposes is $7,291,501,427, the aggregate gross unrealized appreciation is $21,728,680 and the aggregate gross unrealized depreciation is $144,820,115, resulting in net unrealized depreciation of $123,091,435.

Abbreviations:

CME

  

−

  

Chicago Mercantile Exchange.

CMT

  

−

  

Constant Maturity Treasury.

FHLMC

  

−

  

Federal Home Loan Mortgage Corporation.

FNMA

  

−

  

Federal National Mortgage Association.

GNMA

  

−

  

Government National Mortgage Association.

RFUCCT

  

−

  

Refinitiv USD IBOR Consumer Cash Fallbacks Term.

SOFR

  

−

  

Secured Overnight Financing Rate.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

17

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

FINANCIAL FUTURES CONTRACTS

The following futures contracts were open at April 30, 2024:

Description

  

Number
of
Contracts

  

Expiration
Date

  

Notional
Amount

  

Market
Value

  

Unrealized
Gain/(Loss)

Contracts to Sell:

          

 

    

 

    

 

  

U.S. Treasury 2-Year Notes

  

521

  

June 2024

  

$

106,613,695

  

$

105,583,906

  

$

1,029,789

U.S. Treasury 5-Year Notes

  

2,229

  

June 2024

  

 

237,823,852

  

 

233,470,337

  

 

4,353,515
           

 

    

 

    

$

5,383,304

Fair Value Measurements

The Fund is required to disclose information regarding the fair value measurements of the Fund’s assets and liabilities. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The disclosure requirement established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including, for example, the risk inherent in a particular valuation technique used to measure fair value, including the model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the Fund’s own considerations about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

Authoritative guidance establishes three levels of the fair value hierarchy as follows:

— Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities.

— Level 2 – significant other observable inputs (including quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.).

— Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities).

Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. Inputs may include price information, specific and broad credit data, liquidity statistics, and other factors. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires judgment by the investment adviser. The investment adviser considers observable data to be that market

The accompanying notes are an integral part of these financial statements.

18

    

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The categorization of a financial instrument within the hierarchy is based upon the pricing transparency of the instrument and does not necessarily correspond to the investment adviser’s perceived risk of that instrument.

Financial assets within Level 1 are based on quoted market prices in active markets. The Fund does not adjust the quoted price for these instruments.

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. These include investment-grade corporate bonds, U.S. Treasury notes and bonds, and certain non-U.S. sovereign obligations and over-the-counter derivatives. As Level 2 financial assets include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

Financial assets classified within Level 3 have significant unobservable inputs, as they trade infrequently. Level 3 financial assets include asset backed securities and certain corporate debt securities.

Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon the actual sale of those investments.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

19

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

The following table summarizes the valuation of the Fund’s investments by the above fair value hierarchy levels as of April 30, 2024.

Investments, at value

  

Unadjusted
Quoted Prices in
Active Markets
for Identical
Investments
(Level 1)

  

Significant
Other
Observable
Inputs
(Level 2)

  

Significant
Unobservable
Inputs
(Level 3)

  

Balance as of
April 30, 2024

Asset Backed Securities

  

$

—

  

$

1,575,060,899

  

$

8,887,832

  

$

1,583,948,731

Commercial Mortgage Backed Securities

  

 

—

  

 

430,859,580

  

 

—

  

 

430,859,580

Corporate Bonds

  

 

—

  

 

3,139,574,551

  

 

—

  

 

3,139,574,551

Loan Participations and Assignments

  

 

—

  

 

706,816,308

  

 

149,425,207

  

 

856,241,515

Municipal Bonds

  

 

—

  

 

30,297,301

  

 

—

  

 

30,297,301

Residential Mortgage Backed Securities

  

 

—

  

 

19,487,634

  

 

—

  

 

19,487,634

U.S. Government Agency Obligations

  

 

—

  

 

67,653,646

  

 

—

  

 

67,653,646

U.S. Treasury Bills

  

 

—

  

 

1,020,423,431

  

 

—

  

 

1,020,423,431

U.S. Treasury Bonds and Notes

  

 

—

  

 

14,540,299

  

 

—

  

 

14,540,299

Total Investments, at value

  

$

—

  

$

7,004,713,649

  

$

158,313,039

  

$

7,163,026,688

Other Financial Instruments, at value

  

 

    

 

    

 

    

 

  

Financial Futures Contracts

  

$

5,383,304

  

$

—

  

$

—

  

$

5,383,304

Other Financial Instruments, at value

  

$

5,383,304

  

$

—

  

$

—

  

$

5,383,304

The accompanying notes are an integral part of these financial statements.

20

    

 

BBH LIMITED DURATION FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

The following is a reconciliation of assets for which significant unobservable inputs (Level 3) were used in determining fair value during the period ended April 30, 2024:

 

Asset Backed
Securities

  

Loan
Participations
and Assignments

  

Total

Balance as of October 31, 2023

  

$

9,289,141

 

  

$

48,865,000

 

  

$

58,154,141

 

Purchases

  

 

—

 

  

 

94,001,875

 

  

 

94,001,875

 

Sales/Paydowns

  

 

(839,183

)

  

 

(50,472,920

)

  

 

(51,312,103

)

Realized gains/(losses)

  

 

—

 

  

 

(834,004

)

  

 

(834,004

)

Change in unrealized appreciation/(depreciation)

  

 

437,874

 

  

 

1,631,705

 

  

 

2,069,579

 

Amortization

  

 

—

 

  

 

378,118

 

  

 

378,118

 

Transfers from Level 3

  

 

—

 

  

 

—

 

  

 

—

 

Transfers to Level 3

  

 

—

 

  

 

55,855,433

 

  

 

55,855,433

 

Balance as of April 30, 2024

  

$

8,887,832

 

  

$

149,425,207

 

  

$

158,313,039

 

Fund investments classified as Level 3 were either single broker quoted or fair valued using a market approach or an income approach with valuation inputs such as a discounted cash flow model or market price information adjusted for changes in an appropriate index. As of April 30, 2024, $58,157,832 of value of the Level 3 assets in the Fund was based on a single quote from a broker.

The accompanying notes are an integral part of these financial statements.

F i n a n c i a l   S t a t e m e n t s   A p r i l   3 0,   2 0 2 4

  

21

 

BBH LIMITED DURATION FUND

STATEMENT OF ASSETS AND LIABILITIES

April 30, 2024 (unaudited)

ASSETS:

    

Investments in securities, at value (Cost $7,291,501,427)

  

$

7,163,026,688

 

Cash

  

 

392,205

 

Receivables for:

  

 

  

 

Interest

  

 

37,438,980

 

Investments sold

  

 

21,674,876

 

Shares sold

  

 

3,265,616

 

Futures variation margin on open contracts

  

 

930,171

 

Interest from Custodian

  

 

18,065

 

Prepaid expenses

  

 

59,386

 

Total Assets

  

 

7,226,805,987

 

LIABILITIES:

  

 

  

 

Payables for:

  

 

  

 

Shares redeemed

  

 

3,436,880

 

Net investment advisory and administrative fees

  

 

1,481,572

 

Dividends declared

  

 

695,702

 

Custody and fund accounting fees

  

 

317,929

 

Shareholder servicing fees

  

 

74,278

 

Professional fees

  

 

57,139

 

Transfer agent fees

  

 

12,524

 

Board of Trustees' fees

  

 

579

 

Accrued expenses and other liabilities

  

 

48,863

 

Total Liabilities

  

 

6,125,466

 

NET ASSETS

  

$

7,220,680,521

 
   

 

  

 

Net Assets Consist of:

  

 

  

 

Paid-in capital

  

$

7,356,418,551

 

Accumulated deficit

  

 

(135,738,030

)

Net Assets

  

$

7,220,680,521

 
   

 

  

 

NET ASSET VALUE AND OFFERING PRICE PER SHARE

  

 

  

 

CLASS N SHARES

  

 

  

 

($454,753,308 ÷ 44,157,219 shares outstanding)

  

$

10.30

 

CLASS I SHARES

  

 

  

 

($6,765,927,213 ÷ 657,323,877 shares outstanding)

  

$

10.29

 

The accompanying notes are an integral part of these financial statements.

22

    

 

BBH LIMITED DURATION FUND

STATEMENT OF OPERATIONS

For the six months ended April 30, 2024 (unaudited)

NET INVESTMENT INCOME:

  

 

  

 

Income:

  

 

  

 

Interest income

  

$

182,622,843

 

Interest income from Custodian

  

 

127,553

 

Other income

  

 

2,992,386

 

Total Income

  

 

185,742,782

 
   

 

  

 

Expenses:

  

 

  

 

Investment advisory and administrative fees

  

 

9,210,713

 

Shareholder servicing fees

  

 

443,037

 

Custody and fund accounting fees

  

 

290,042

 

Board of Trustees' fees

  

 

77,876

 

Professional fees

  

 

53,166

 

Transfer agent fees

  

 

38,017

 

Miscellaneous expenses

  

 

277,002

 

Total Expenses

  

 

10,389,853

 

Investment advisory and administrative fee waiver

  

 

(314,248

)

Net Expenses

  

 

10,075,605

 

Net Investment Income

  

 

175,667,177

 
   

 

  

 

NET REALIZED AND UNREALIZED GAIN:

  

 

  

 

Net realized loss on investments in securities

  

 

(8,623,348

)

Net realized gain on futures contracts

  

 

922,398

 

Net realized loss on investments in securities and futures contracts

  

 

(7,700,950

)

Net change in unrealized appreciation/(depreciation) on investments in securities

  

 

140,585,905

 

Net change in unrealized appreciation/(depreciation) on futures contracts

  

 

313,305

 

Net change in unrealized appreciation/(depreciation) on investments in securities and futures contracts

  

 

140,899,210

 

Net Realized and Unrealized Gain

  

 

133,198,260

 

Net Increase in Net Assets Resulting from Operations

  

$

308,865,437

 

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

23

 

BBH LIMITED DURATION FUND

STATEMENTS OF CHANGES IN NET ASSETS
 

For the
six months ended
April 30, 2024
(unaudited)

  

For the
year ended
October 31, 2023

INCREASE/(DECREASE) IN NET ASSETS FROM:

  

 

  

 

  

 

  

 

Operations:

  

 

  

 

  

 

  

 

Net investment income

  

$

175,667,177

 

  

$

312,631,297

 

Net realized gain/(loss) on investments in securities and futures contracts

  

 

(7,700,950

)

  

 

20,192,220

 

Net change in unrealized appreciation/(depreciation) on investments in securities and futures contracts

  

 

140,899,210

 

  

 

138,827,140

 

Net increase in net assets resulting from operations

  

 

308,865,437

 

  

 

471,650,657

 
   

 

  

 

  

 

  

 

Dividends and distributions declared:

  

 

  

 

  

 

  

 

Class N

  

 

(10,879,225

)

  

 

(18,843,572

)

Class I

  

 

(167,610,502

)

  

 

(293,175,046

)

Total dividends and distributions declared

  

 

(178,489,727

)

  

 

(312,018,618

)
   

 

  

 

  

 

  

 

Share transactions:

  

 

  

 

  

 

  

 

Proceeds from sales of shares1

  

 

1,139,373,779

 

  

 

2,363,986,624

 

Net asset value of shares issued to shareholders for reinvestment of dividends and distributions

  

 

46,764,847

 

  

 

79,989,422

 

Cost of shares redeemed1

  

 

(1,223,326,048

)

  

 

(3,715,647,694

)

Net decrease in net assets resulting from share transactions

  

 

(37,187,422

)

  

 

(1,271,671,648

)

Total increase/(decrease) in net assets

  

 

93,188,288

 

  

 

(1,112,039,609

)
   

 

  

 

  

 

  

 

NET ASSETS:

  

 

  

 

  

 

  

 

Beginning of period/year

  

 

7,127,492,233

 

  

 

8,239,531,842

 

End of period/year

  

$

7,220,680,521

 

  

$

7,127,492,233

 

____________

​1       Includes share exchanges. See Note 5 in Notes to Financial Statements.

The accompanying notes are an integral part of these financial statements.

24

    

 

BBH LIMITED DURATION FUND

FINANCIAL HIGHLIGHTS

Selected per share data and ratios for a Class N share outstanding throughout each period/year.
 

For the
six months
ended
April 30, 2024
(unaudited)



For the years ended October 31,
 

2023

    

2022

    

2021

    

2020

    

2019

  

Net asset value, beginning of period/year

  

 

  

$

10.11

 

 

 

$

9.91

 

 

 

$

10.32

 

 

 

$

10.23

 

 

 

$

10.26

 

 

 

$

10.15

 

  

Income from investment operations:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

Net investment income1

      

 

0.25

 

    

 

0.41

 

    

 

0.19

 

    

 

0.15

 

    

 

0.24

 

    

 

0.30

 

  

Net realized and unrealized gain/(loss)

      

 

0.19

 

    

 

0.20

 

    

 

(0.41

)

    

 

0.09

 

    

 

(0.03

)

    

 

0.11

 

  

Total income/(loss) from investment operations

      

 

0.44

 

    

 

0.61

 

    

 

(0.22

)

    

 

0.24

 

    

 

0.21

 

    

 

0.41

 

  

Dividends and distributions to shareholders:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

From net investment income

      

 

(0.25

)

    

 

(0.41

)

    

 

(0.19

)

    

 

(0.15

)

    

 

(0.24

)

    

 

(0.30

)

  

From net realized gains

      

 

(0.00

)2

    

 

—

 

    

 

—

 

    

 

—

 

    

 

—

 

    

 

—

 

  

Total dividends and distributions to shareholders

      

 

(0.25

)

    

 

(0.41

)

    

 

(0.19

)

    

 

(0.15

)

    

 

(0.24

)

    

 

(0.30

)

  

Net asset value, end of period/year

      

$

10.30

 

    

$

10.11

 

    

$

9.91

 

    

$

10.32

 

    

$

10.23

 

    

$

10.26

 

  

Total return3

      

 

4.39

%4

    

 

6.24

%

    

 

(2.12

)%

    

 

2.38

%

    

 

2.06

%

    

 

4.14

%

  

Ratios/Supplemental data:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

Net assets, end of period/year (in millions)

      

$

455

 

    

$

440

 

    

$

490

 

    

$

656

 

    

$

461

 

    

$

371

 

  

Ratio of expenses to average net assets before reductions

      

 

0.49

%5

    

 

0.49

%

    

 

0.49

%

    

 

0.49

%

    

 

0.49

%

    

 

0.51

%

  

Fee waiver6

      

 

(0.14

)%5

    

 

(0.14

)%

    

 

(0.14

)%

    

 

(0.14

)%

    

 

(0.14

)%

    

 

(0.16

)%

  

Expense offset arrangement

      

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

(0.00

)%7

  

Ratio of expenses to average net assets after reductions

      

 

0.35

%5

    

 

0.35

%

    

 

0.35

%

    

 

0.35

%

    

 

0.35

%

    

 

0.35

%

  

Ratio of net investment income to average net assets

      

 

4.83

%5

    

 

4.06

%

    

 

1.87

%

    

 

1.48

%

    

 

2.32

%

    

 

2.98

%

  

Portfolio turnover rate

      

 

16

%4

    

 

22

%

    

 

46

%

    

 

34

%

    

 

51

%

    

 

53

%

  

____________

​1         Calculated using average shares outstanding for the period/year.

​2         Less than $0.01.

​3         Assumes the reinvestment of distributions.

​4         Not annualized.

​5         Annualized.

​6    The ratio of expenses to average net assets for the six months ended April 30, 2024, the years ended October 31, 2023, 2022, 2021, 2020 and 2019, reflects fees reduced as result of a contractual operating expense limitation of the share class to 0.35%. The agreement is effective through March 1, 2025 and may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024 and the years ended October 31, 2023, 2022, 2021, 2020 and 2019 the waived fees were $314,248, $665,947, $797,646, $746,522, $595,975 and $538,703, respectively.

​7         Less than 0.01%.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

25

 

BBH LIMITED DURATION FUND

FINANCIAL HIGHLIGHTS (continued)

Selected per share data and ratios for a Class I share outstanding throughout each period/year.
 

For the
six months
ended
April 30, 2024
(unaudited)



For the years ended October 31,
 

2023

    

2022

    

2021

    

2020

    

2019

  

Net asset value, beginning of period/year

  

 

  

$

10.11

 

 

 

$

9.90

 

 

 

$

10.32

 

 

 

$

10.23

 

 

  

$

10.25

 

    

$

10.15

 

  

Income from investment operations:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

Net investment income1

      

 

0.25

 

    

 

0.41

 

    

 

0.19

 

    

 

0.16

 

    

 

0.24

 

    

 

0.31

 

  

Net realized and unrealized gain/(loss)

      

 

0.18

 

    

 

0.22

 

    

 

(0.41

)

    

 

0.09

 

    

 

(0.02)

 

    

 

0.10

 

  

Total income/(loss) from investment operations

      

 

0.43

 

    

 

0.63

 

    

 

(0.22)

 

    

 

0.25

 

    

 

0.22

 

    

 

0.41

 

  

Dividends and distributions to shareholders:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

From net investment income

      

 

(0.25

)

    

 

(0.42

)

    

 

(0.20

)

    

 

(0.16

)

    

 

(0.24

)

    

 

(0.31

)

  

From net realized gains

      

 

(0.00

)2

    

 

—

 

    

 

—

 

    

 

—

 

    

 

—

 

    

 

—

 

  

Total dividends and distributions to shareholders

      

 

(0.25

)

    

 

(0.42

)

    

 

(0.20

)

    

 

(0.16

)

    

 

(0.24

)

    

 

(0.31

)

  

Net asset value, end of period/year

      

$

10.29

 

    

$

10.11

 

    

$

9.90

 

    

$

10.32

 

    

$

10.23

 

    

$

10.25

 

  

Total return3

      

 

4.33

%4

    

 

6.43

%

    

 

(2.14

)%

    

 

2.46

%

    

 

2.24

%

    

 

4.12

%

  

Ratios/Supplemental data:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

Net assets, end of period/year (in millions)

      

$

6,766

 

    

$

6,688

 

    

$

7,749

 

    

$

11,442

 

    

$

7,610

 

    

$

6,769

 

  

Ratio of expenses to average net assets before reductions

      

 

0.28

%5

    

 

0.28

%

    

 

0.27

%

    

 

0.27

%

    

 

0.27

%

    

 

0.28

%

  

Expense offset arrangement

      

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

(0.00

)%6

  

Ratio of expenses to average net assets after reductions

      

 

0.28

%5

    

 

0.28

%

    

 

0.27

%

    

 

0.27

%

    

 

0.27

%

    

 

0.28

%

  

Ratio of net investment income to average net assets

      

 

4.90

%5

    

 

4.13

%

    

 

1.92

%

    

 

1.55

%

    

 

2.40

%

    

 

3.04

%

  

Portfolio turnover rate

      

 

16

%4

    

 

22

%

    

 

46

%

    

 

34

%

    

 

51

%

    

 

53

%

  

____________

​1         Calculated using average shares outstanding for the period/year.

​2         Less than $0.01.

​3         Assumes the reinvestment of distributions.

​4         Not annualized.

​5         Annualized.

​6         Less than 0.01%.

The accompanying notes are an integral part of these financial statements.

26

    

 

BBH LIMITED DURATION FUND

NOTES TO FINANCIAL STATEMENTS

April 30, 2024 (unaudited)

1.  Organization. The Fund is a separate, diversified series of BBH Trust (the “Trust”), which is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust was originally organized under the laws of the State of Maryland on July 16, 1990 as BBH Fund, Inc. and re-organized as a Delaware statutory trust on June 12, 2007. As of April 30, 2024, there were eight series of the Trust. The Fund commenced operation on December 22, 2000 and offers two share classes, Class N and Class I. Neither Class N shares nor Class I shares automatically convert to any other share class of the Fund. The investment objective of the Fund is to provide maximum total return, consistent with preservation of capital and prudent investment management.

2. Significant Accounting Policies. The Fund’s financial statements are prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”). The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 Financial Services – Investment Companies. The following summarizes significant accounting policies of the Fund:

A. Valuation of Investments. The Board of Trustees (the “Board”) has ultimate responsibility for the supervision and oversight of the determination of the fair value of investments. Pursuant to Rule 2a-5 of the 1940 Act, the Board has designated the Investment Adviser as its valuation designee. The Investment Adviser monitors the continual appropriateness of valuation methods applied and determines if adjustments should be made in light of market factor changes and events affecting issuers. The Investment Adviser performs a series of activities to provide reasonable assurance of the appropriateness of the prices utilized, including but not limited to: periodic independent pricing service due diligence meetings and reviewing the results of back testing on a monthly basis. The Investment Adviser provides the Board with reporting on the results of the back testing as well as positions which were fair valued during the period.

All securities and other investments are recorded at their estimated fair value. The value of investments listed on a securities exchange is based on the last sale price prior to the time when assets are valued, or in the absence of recorded sales, at the most recent bid price on such exchange. If a readily available market quotation is not available or is determined to be unreliable, the investments may be valued utilizing evaluated prices provided by independent pricing services. In establishing such prices, the independent pricing service utilizes both dealer supplied prices and electronic data processing techniques which take into account appropriate factors such as institutional sized trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics, the closure of the primary exchange on which securities trade and before the Fund’s net asset value is next determined and other market data without exclusive reliance on quoted exchange prices or over-the-counter prices since such valuations are believed to reflect more accurately the fair value of such investments. Investments may be fair valued by Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“SID” or “Investment Adviser”) in accordance with the BBH Trust Portfolio Valuation Policy and Procedures using methods

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

27

 

BBH LIMITED DURATION FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

that most fairly reflect the amount that the Fund would reasonably expect to receive for the investment on a current sale in its principal market in the ordinary course of business. Short-term investments, which mature in 60 days or less are valued at amortized cost if their original maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if their original maturity when acquired by the Fund was more than 60 days, unless the use of amortized cost is determined not to represent fair value. Any futures contracts held by the Fund are valued daily at the official settlement price of the exchange on which they are traded.

B. Accounting for Investments and Income. Investment transactions are accounted for on the trade date. Realized gains and losses on investment transactions are determined based on the identified cost method. Interest income is accrued daily and consists of interest accrued, discount earned (including, if any, both original issue and market discount) and premium amortization on the investments of the Fund. Investment income is recorded net of any foreign taxes withheld where recovery of such tax is uncertain. Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivable when the collection of all or a portion of the interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.

C. Fund Expenses. Most expenses of the Trust can be directly attributed to a specific fund and share class. Expenses which cannot be directly attributed to a fund are generally apportioned among each fund in the Trust and the respective share classes on a net assets basis or other suitable method. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

D. Financial Futures Contracts. The Fund may enter into open futures contracts in order to economically hedge against anticipated future changes in interest rates which otherwise might either adversely affect the value of securities held for the Fund or adversely affect the prices of securities that are intended to be purchased at a later date for the Fund. The contractual amount of the futures contracts represents the investment the Fund has in a particular contract and does not necessarily represent the amounts potentially subject to risk of loss. Trading in futures contracts involves, to varying degrees, risk of loss in excess of any futures variation margin reflected in the Statement of Assets and Liabilities. The measurement of risk associated with futures contracts is meaningful only when all related and offsetting transactions are considered. Gains and losses are realized upon the expiration or closing of the futures contracts.

Risks related to the use of futures contracts include possible illiquidity of the futures markets, contract prices that can be highly volatile and imperfectly correlated to movements in economically hedged security values and/or interest rates, and potential losses in excess of the Fund’s initial investment.

Open future contracts held at April 30, 2024, are listed in the Portfolio of Investments.

28

    

 

BBH LIMITED DURATION FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

For the six months ended April 30, 2024, the average monthly notional amount of open futures contracts was $378,999,917. The range of monthly notional amounts was $344,437,548 to $425,130,157.

Fair Values of Derivative Instruments as of April 30, 2024

Derivatives not accounted for as economically hedging instruments under authoritative guidance for derivatives instruments and hedging activities:

 

Risk

  

Asset Derivatives

  

Liability Derivatives

Statement of Assets
and Liabilities Location

  

Fair Value

  

Statement of Assets
and Liabilities Location

  

Fair Value
   

Interest Rate Risk

  

Net unrealized
appreciation/(depreciation)
on futures contracts

  

$5,383,304

*

  

Net unrealized
appreciation/(depreciation)
on futures contracts

  

$

—
           

 

 

      

 

 
   

Total

      

$5,383,304

 

      

$

—

––––––––––––––––––––––––––

*   Includes cumulative appreciation/(depreciation) of futures contracts as reported in the Statement of Assets and Liabilities and Notes to Financial Statements. Only the current day’s variation margin is reported within the Statement of Assets and Liabilities.

 

Effect of Derivative Instruments on the Statement of Operations

    
       

Interest Rate Risk
   

Net Realized Gain/(Loss) on Derivatives

  

 

  
   

Futures Contracts

  

$

922,398
       

 

  
   

Net Change in Unrealized Appreciation/(Depreciation) on Derivatives

  

 

  
   

Futures Contracts

  

$

313,305

E. Private Placement Securities. The Fund may purchase securities that are not registered under the Securities Act of 1933, as amended (“1933 Act”) but that can be sold to “qualified institutional buyers” in accordance with the requirements stated in Rule 144A or the requirements stated in Regulation D of the 1933 Act (”Private Placement Securities”). A Private Placement Security may be considered illiquid and therefore, under the U.S. Securities and Exchange Commission (“SEC”) Regulations for open-end investment companies, subject to the 15% limitation on the purchase of illiquid securities, unless it is determined on an ongoing basis that an adequate trading market exists for the security, which is the case for the Fund. Guidelines have been adopted and the daily function of determining and monitoring liquidity of Private Placement Securities has been delegated to the investment adviser. All relevant factors will be considered in determining the liquidity of Private Placement Securities and all investments in Private Placement Securities will be carefully monitored. Information regarding Private Placement Securities is included at the end of the Portfolio of Investments.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

29

 

BBH LIMITED DURATION FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

F.   Loan Participations and Assignments. The Fund may invest in loan participations and assignments, which include institutionally traded floating and fixed-rate debt securities generally acquired as an assignment from another holder of, or participation interest in, loans originated by a bank or financial institution (the “Lender”) that acts as agent for all holders. Some loan participations and assignments may be purchased on a “when-issued” basis. The agent administers the terms of the loan, as specified in the loan agreement. When investing in a loan assignment, the Fund acquires the loan in whole or in part and becomes a lender under the loan agreement. The Fund generally has the right to enforce compliance with the terms of the loan agreement with the borrower.

Assignments and participations involve credit, interest rate, and liquidity risk. Interest rates on floating rate securities adjust with interest rate changes and/or issuer credit quality, and unexpected changes in such rates could result in losses to the Fund. The interest rates paid on a floating rate security in which the Fund invests generally are readjusted periodically to an increment over a designated benchmark rate, such as the one-month, three-month, six-month, or one-year Secured Overnight Financing Rate (“SOFR”).

The Fund may have difficulty trading assignments and participations to third parties. There may be restrictions on transfer and only limited opportunities may exist to sell such securities in secondary markets. As a result, the Fund may be unable to sell assignments or participations at the desired time or may be able to sell only at a price less than fair market value. The Fund utilizes an independent third party to value individual loan participations and assignments on a daily basis.

G.  Federal Income Taxes. It is the Trust’s policy to comply with the requirements of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. The Fund files a tax return annually using tax accounting methods required under provisions of the Code, which may differ from GAAP, which is the basis on which these financial statements are prepared. Accordingly, the amount of net investment income and net realized gain reported in these financial statements may differ from that reported on the Fund’s tax return, due to certain book-to-tax timing differences such as losses deferred due to “wash sale” transactions and utilization of capital loss carryforwards. These differences may result in temporary over-distributions for financial statement purposes and are classified as distributions in excess of accumulated net realized gains or net investment income. These distributions do not constitute a return of capital. Permanent differences are reclassified between paid-in capital and retained earnings/(accumulated deficit) within the Statement of Assets and Liabilities based upon their tax classification. As such, the character of distributions to shareholders reported in the Financial Highlights table may differ from that reported to shareholders on Form 1099-DIV.

The Fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (“ASC 740”). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The Fund did not have any unrecognized tax benefits as of October 31, 2023, nor were there any increases or decreases in

30

    

 

BBH LIMITED DURATION FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

unrecognized tax benefits for the year then ended. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits as an income tax expense in the Statement of Operations. During the six months ended April 30, 2024, the Fund did not incur any such interest or penalties. The Fund is subject to examination by U.S. federal and state tax authorities for returns filed for the prior three fiscal years. The Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

H. Dividends and Distributions to Shareholders. Dividends and distributions from net investment income to shareholders are declared daily and paid monthly to shareholders. Distributions from net capital gains, if any, are generally declared and paid annually and are recorded on the ex-dividend date. The Fund declared dividends and distributions in the amount of $10,879,225 and $167,610,502 to Class N and Class I shareholders, respectively, during the six months ended April 30, 2024.

The tax character of distributions paid during the years ended October 31, 2023 and 2022, respectively, were as follows:

 

Distributions paid from:
   

Ordinary
income

  

Net
long-term
capital gain

  

Total
taxable
distributions

  

Tax return
of capital

  

Total
distributions
paid

2023:

  

$     312,018,618

  

$        —

  

$    312,018,618

  

$        —

  

$    312,018,618

2022:

  

       199,931,830

  

          —

  

      199,931,830

  

          —

  

      199,931,830

As of October 31, 2023 and 2022, respectively, the components of retained earnings/(accumulated deficit) on tax basis were as follows:

 

Components of retained earnings/(accumulated deficit):
   

Undistributed
ordinary
income

  

Undistributed
long-term
capital gain

  

Accumulated
capital and
other losses

  

Other
book/tax
temporary
differences

  

Book
unrealized
appreciation/
(depreciation)

  

Total
retained
earnings/
(accumulated
deficit)

2023:

  

$

3,809,972

  

$        —

  

$

—

 

  

$

(5,933,067

)

  

$

(263,990,645

)

  

$

(266,113,740

)

2022:

  

 

144,719

  

          —

  

 

(1,015,984

)

  

 

(21,960,797

)

  

 

(402,817,785

)

  

 

(425,649,847

)

The Fund did not have a net capital loss carryforward at October 31, 2023.

The Fund is permitted to carryforward capital losses for an unlimited period and they will retain their character as either short-term or long-term capital losses.

Total distributions paid may differ from amounts reported in the Statements of Changes in Net Assets because, for tax purposes, dividends are recognized when actually paid.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

31

 

BBH LIMITED DURATION FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

The differences between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable primarily to the tax deferral of losses on wash sales and paydowns on fixed income securities.

To the extent future capital gains are offset by capital loss carryforwards, if any, such gains will not be distributed.

I.  Use of Estimates. The preparation of the financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increase and decrease in net assets from operations during the reporting period. Actual results could differ from these estimates.

3. Fees and Other Transactions with Affiliates.

A. Investment Advisory and Administrative Fees. Under a combined Investment Advisory and Administrative Services Agreement (“Agreement”) with the Trust, Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“Investment Adviser”) provides investment advisory, portfolio management and administrative services to the Fund. The Fund pays a combined fee for investment advisory and administrative services calculated daily and paid monthly at an annual rate equivalent to 0.30% per annum on the first $1 billion of the Fund’s average daily net assets and 0.25% per annum on the Fund’s average daily net assets over $1 billion. For the six months ended April 30, 2024, the Fund incurred $9,210,713 for services under the Agreement.

B. Investment Advisory and Administrative Fee Waivers. Effective June 14, 2018 the Investment Adviser has contractually agreed to waive fees and/or reimburse expenses for the Fund’s Class N shares in order to limit total annual fund operating expenses (excluding interest, taxes, brokerage commissions, other expenditures that are capitalized in accordance with GAAP, other extraordinary expenses not incurred in the ordinary course of the Fund’s business) for Class N to 0.35%. The agreement will terminate on March 1, 2025 unless it is renewed by all parties to the agreement. The agreement may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024, the Investment Adviser waived fees in the amount of $314,248 for Class N.

C. Shareholder Servicing Fees. The Trust has a shareholder servicing agreement with BBH. BBH receives a fee from the Fund calculated daily and paid monthly at an annual rate of 0.20% of Class N shares’ average daily net assets. For the six months ended April 30, 2024, Class N shares of the Fund incurred $443,037 in shareholder servicing fees.

D. Custody and Fund Accounting Fees. BBH acts as a custodian and fund accountant and receives custody and fund accounting fees from the Fund calculated daily and paid monthly. BBH holds all of the Fund’s cash and investments and calculates the Fund’s daily net asset value. The custody fee is based partially on asset values and partially on individual fund transactions. The fund accounting fee

32

    

 

BBH LIMITED DURATION FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

is primarily an asset-based fee calculated at 0.325 basis points per annum of the Fund’s net asset value. For the six months ended April 30, 2024, the Fund incurred $290,042 in custody and fund accounting fees. As per agreement with the Fund’s custodian, the Fund receives interest income on cash balances held by the custodian at the BBH Base Rate. The BBH Base Rate is defined as BBH’s effective trading rate in local money markets on each day. The total interest earned by the Fund for the six months ended April 30, 2024 was $127,553. This amount is included in “Interest income from Custodian” in the Statement of Operations. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to their agreement, the Fund will pay the BBH Overdraft Base Rate plus 2% on the day of the overdraft. The Fund did not incur any such fees during the six months ended April 30, 2024. This amount is included under line item “Custody and fund accounting fees” in the Statement of Operations.

E. Board of Trustees’ Fees. Each Trustee who is not an “interested person” as defined under the 1940 Act receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the six months ended April 30, 2024, the Fund incurred $77,876 in independent Trustee compensation and expense reimbursements.

F. Officers of the Trust. Officers of the Trust are also employees of BBH. Officers are paid no fees by the Trust for their services to the Trust.

4. Investment Transactions. For the six months ended April 30, 2024, the cost of purchases and the proceeds of sales of investment securities, other than short-term investments, were $1,037,288,678 and $1,743,334,161, respectively.

5. Shares of Beneficial Interest. The Trust is permitted to issue an unlimited number of Class N shares and Class I shares of beneficial interest, at no par value. Transactions in Class N and Class I shares were as follows:

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

33

 

BBH LIMITED DURATION FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)
     

For the six months ended
April 30, 2024 (unaudited)

  

For the year ended
October 31, 2023
       

Shares

  

Dollars

  

Shares

  

Dollars
   

Class N

    

 

  

 

  

 

    

 

  

 

  

 
   

Shares sold

  

8,090,568

 

  

$

83,028,603

 

  

16,648,681

 

  

$

167,017,042

 
   

Shares issued in connection with reinvestments of dividends

  

1,025,695

 

  

 

10,538,223

 

  

1,811,474

 

  

 

18,214,422

 
   

Shares redeemed

  

(8,429,644

)

  

 

(86,461,791

)

  

(24,481,906

)

  

 

(245,721,231

)
   

Net increase/(decrease)

  

686,619

 

  

$

7,105,035

 

  

(6,021,751

)

  

$

(60,489,767

)
         

 

  

 

  

 

    

 

  

 

  

 
   

Class I

    

 

  

 

  

 

    

 

  

 

  

 
   

Shares sold

  

102,945,564

 

  

$

1,056,345,176

 

  

218,901,381

 

  

$

2,196,969,582

 
   

Shares issued in connection with reinvestments of dividends

  

3,527,052

 

  

 

36,226,624

 

  

6,146,307

 

  

 

61,775,000

 
   

Shares redeemed

  

(110,869,845

)

  

 

(1,136,864,257

)

  

(345,987,715

)

  

 

(3,469,926,463

)
   

Net decrease

  

(4,397,229

)

  

$

(44,292,457

)

  

(120,940,027

)

  

$

(1,211,181,881

)

Included in Shares Sold and Shares Redeemed are shareholder exchanges during the six months ended April 30, 2024 and the year ended October 31, 2023. Specifically:

During the six months ended April 30, 2024, 753,996 shares of Class N were exchanged for 754,652 shares of Class I valued at $7,769,629 and 12,560 shares of Class I were exchanged for 12,548 shares of Class N valued at $129,464.

During the year ended October 31, 2023, 489,572 shares of Class N were exchanged for 489,939 shares of Class I valued at $4,904,794 and 143,112 shares of Class I were exchanged for 142,972 shares of Class N valued at $1,438,063.

6. Principal Risk Factors and Indemnifications.

A.  Principal Risk Factors. Investing in the Fund may involve certain risks, as discussed in the Fund’s prospectus, including but not limited to, those described below:

A shareholder may lose money by investing in the Fund (investment risk). The Fund is actively managed and the decisions by the Investment Adviser may cause the Fund to incur losses or miss profit opportunities (management risk). In the normal course of business, the Fund invests in securities and enters into transactions where risks exist due to failure of a counterparty to a transaction to perform (credit risk), changes in interest rates (interest rate risk), higher volatility for securities with longer maturities (maturity risk), financial performance or leverage of the issuer (issuer risk), difficulty in being able to purchase or sell a security (illiquid securities risk), or certain risks associated with investing in non-U.S. securities not present in domestic investments, including, but not limited to, recovery of tax withheld by foreign jurisdictions (non-U.S. investment

34

    

 

BBH LIMITED DURATION FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

risk). The Fund may invest in securities of other investment companies, consisting of ETFs and money market funds. When purchasing shares of other investment companies, shareholders bear both their proportionate share of the Fund’s expenses and similar expenses of the underlying investment company when the Fund invests in shares of another investment company. The Fund is subject to the risks associated with the investment company’s investments (investment company risk), and risks from investing in securities of issuers based in developing countries (emerging markets risk). The Fund may use of derivatives that could create risks that are different from, or possibly greater than, the risks associated with investing directly in securities as the Fund could lose more than the principal amount invested (derivatives risk). Due to uncertainty regarding the ability of the issuer to pay principal and interest, securities that are rated below investment grade (i.e., Ba1/BB+ or lower) (junk bond risk), and their unrated equivalents, may be subject to greater risks than securities which have higher credit ratings, including a high risk of default. The Fund invests in asset-backed (asset-backed securities risk) and mortgage-backed securities (mortgage-backed securities risk) which are subject to the risk that borrowers may default on the obligations that underlie these securities. In addition, these securities may be paid off sooner (prepayment risk) or later than expected which may increase the volatility of securities during periods of fluctuating interest rates. The Fund may invest in bonds issued by foreign governments which may be unable or unwilling to make interest payments and/or repay the principal owed (sovereign debt risk). The Fund’s use of borrowing, in reverse repurchase agreements and investment in some derivatives, involves leverage. Leverage tends to exaggerate the effect of any increase or decrease in the value of the Fund’s securities and may cause the Fund to be more volatile (leverage risk). Loan participations and assignments, delayed funding loans and revolving credit facilities may have the effect of requiring the Fund to increase its investment in a company at a time when it might not otherwise decide to do so (loan risk). The value of securities held by the Fund may decline in response to certain events, including: those directly involving the companies or issuers whose securities are held by the Fund; conditions affecting the general economy; overall market changes; local, regional or political, social or economic instability; and currency and interest rate and price fluctuations. Natural disasters, the spread of infectious illness and other public health emergencies, recession, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse effects on world economies and markets generally (market risk). The Fund’s shareholders may be adversely impacted by asset allocation decisions made by an investment adviser whose discretionary clients make up a large percentage of the Fund’s shareholders (large shareholder risk). While the U.S. Government has historically provided financial support to U.S. government-sponsored agencies or instrumentalities during times of financial stress, such as the various actions taken to stabilize the Federal National Mortgage Association and Federal Home Loan Mortgage Corporation during the credit crisis of 2008, no assurance can be given that it will do so in the future. Such securities are neither issued nor guaranteed by the U.S. Treasury (U.S. Government Agency Securities Risk). The Fund may invest in private placement securities that are issued pursuant to Regulation S, Regulation D and Rule 144A which have not been registered with SEC. These securities may be subject to contractual restrictions which prohibit or limit their resale (private placement risk). The United Kingdom’s Financial Conduct

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

35

 

BBH LIMITED DURATION FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

Authority announced a phase out of the London Interbank Offered Rate (“LIBOR”). Although many LIBOR rates were phased out by the end of 2021, some USD LIBOR settings will continue to be published under a synthetic methodology until September 30, 2024 for certain legacy contracts. SOFR has been used increasingly on a voluntary basis in new instruments and transactions. Under U.S. regulations that implement a statutory fallback mechanism to replace LIBOR, benchmark rates based on SOFR have replaced LIBOR in certain financial contracts. Any pricing adjustments to the fund’s investments resulting from a substitute reference rate may also adversely affect the fund’s performance and/or net asset value (LIBOR transition risk). The Fund may invest in convertible securities which may perform in a similar manner to a regular debt security and are subject to variety of risks, including investment risk, market risk, issuer risk and interest rate risk (convertible securities risk). The Fund may invest in preferred securities which are equity interests in a company that entitle the holder to receive common stock, dividends and a fixed share of the proceeds resulting from a liquidation of the company, in preference to the holders of other securities. Preferred securities are subject to issuer specific and market risks applicable generally to equity securities (preferred securities risk). The Fund may also invest in notes issued by Business Development Companies (“BDCs”). These notes are subject to risks similar to those of other issuers and those of investment companies (business development company risk). The extent of the Fund’s exposure to these risks in respect to these financial assets is included in their value as recorded in the Fund’s Statement of Assets and Liabilities.

Please refer to the Fund’s prospectus for a complete description of the principal risks of investing in the Fund.

B. Indemnifications. Under the Trust’s organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the Fund, and shareholders are indemnified against personal liability for the obligations of the Trust. Additionally, in the normal course of business, the Fund enters into agreements with service providers that may contain indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss from such claims is considered remote.

7. Subsequent Events. Management has evaluated events and transactions that have occurred since April 30, 2024 through the date the financial statements were issued and determined that there were no subsequent events that would require recognition or additional disclosure in the financial statements.

  

36

    

 

BBH LIMITED DURATION FUND

DISCLOSURE OF FUND EXPENSES

April 30, 2024 (unaudited)

EXAMPLE

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested distributions, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the six-month period and held for the entire period (November 1, 2023 to April 30, 2024).

ACTUAL EXPENSES

The first line of the table provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during the period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% Hypothetical Example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

37

 

BBH LIMITED DURATION FUND

DISCLOSURE OF FUND EXPENSES (continued)

April 30, 2024 (unaudited)

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

Beginning
Account Value
November 1, 2023

  

Ending
Account Value
April 30, 2024

  

Expenses Paid
During Period
November 1, 2023 to
April 30, 20241

Class N

            

Actual

  

$1,000

  

$1,044

  

$1.78

Hypothetical2

  

$1,000

  

$1,023

  

$1.76
 

Beginning
Account Value
November 1, 2023

  

Ending
Account Value
April 30, 2024

  

Expenses Paid
During Period
November 1, 2023 to
April 30, 20241

Class I

            

Actual

  

$1,000

  

$1,043

  

$1.42

Hypothetical2

  

$1,000

  

$1,023

  

$1.41

____________

​1   Expenses are equal to the Fund’s annualized net expense ratio of 0.35% and 0.28% for Class N and I shares, respectively, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period).

​2   Assumes a return of 5% before expenses. For the purposes of the calculation, the applicable annualized expenses ratio for each class of shares is subtracted from the assumed return before expenses.

  

38

    

 

BBH LIMITED DURATION FUND

DISCLOSURE OF ADVISOR SELECTION

April 30, 2024 (unaudited)

Investment Advisory and Administrative Services Agreement Approval

The 1940 Act requires that a fund’s investment advisory agreements be approved annually by the fund’s board of trustees, including by a majority of the trustees who are not parties to the investment advisory agreements or “interested persons” of any party (“Independent Trustees”), cast in person at a meeting called for the purpose of voting on such approval.

The Board, a majority of which is comprised of Independent Trustees, held a telephonic meeting on November 16, 2023 and an in-person meeting on December 12, 2023, in reliance on the Exemptive Relief, to consider whether to renew the combined Amended and Restated Investment Advisory and Administrative Services Agreement (the “Agreement”) between the Trust and the Investment Adviser with respect to the existing funds in the Trust, including the Fund. At the December 12, 2023 meeting, the Board voted to approve the renewal of the Agreement with respect to the Fund for an additional one-year term. In doing so, the Board determined that the terms of the Agreement were fair and reasonable and in the best interest of the Fund and its shareholders, and that it had received sufficient information to make an informed business decision with respect to the continuation of the Agreement.

Both in the meetings specifically held to address the continuance of the Agreement and at other meetings over the course of the year, the Board requested, received and assessed a variety of materials provided by the Investment Adviser and BBH, including, among other things, information about the nature, extent and quality of the services provided to the Fund by the Investment Adviser and BBH, including investment management, administrative and shareholder services, the oversight of Fund service providers, marketing, risk oversight, compliance, and the ability to meet applicable legal and regulatory requirements.

The Board also received third-party comparative performance and fee and expense information for the Fund prepared by Broadridge Financial Solutions, Inc. (“Broadridge”) using data from Lipper Inc., an independent provider of investment company data (“Lipper Report”). The Board reviewed this report with Broadridge, counsel to the Trust (“Fund Counsel”) and BBH. The Board received from, and discussed with Fund Counsel a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements under the 1940 Act, as well as the guidance provided in Gartenberg v. Merrill Lynch Asset Management, Inc., which was affirmed in Jones v. Harris Associates, L.P. In addition, the Board met in executive session outside the presence of Fund management.

In approving the continuation of the Agreement, the Board considered: (a) the nature, extent and quality of services provided by the Investment Adviser; (b) the investment performance of the Fund; (c) the advisory fee and the cost of the services and profits to be realized by the Investment Adviser from its relationship with the Fund; (d) the Fund’s costs to investors compared to the costs of comparative funds and performance compared to the relevant performance of comparative funds; (e) the sharing of potential economies of scale; (f) fall-out benefits to the Investment Adviser as a result of its relationship with the Fund; and (g) other factors deemed relevant by the Board. The following is a summary of certain factors the Board considered in making its determination to approve the continuance of the Agreement. No single factor reviewed by the Board was identified as the principal factor in determining whether to approve the Agreement, and individual Trustees may have given different weight to various factors. The Board

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

39

 

BBH LIMITED DURATION FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

reviewed these factors with Fund Counsel. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the comparative performance, expense information, the cost of the services provided, and the profits realized by the Investment Adviser.

Nature, Extent and Quality of Services

The Board noted that, under the Agreement and with respect to the Fund, the Investment Adviser, subject to the supervision of the Board, is responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Fund’s investment objective and policies. The Board further noted that, as a combined investment advisory and administration agreement, the Agreement also contemplates the provision of administrative services by the Investment Adviser to the Fund within the same fee structure.

The Board received and considered information during the December 12, 2023 meeting, and over the course of the previous year, regarding the nature, extent and quality of services provided to the Fund by the Investment Adviser including: portfolio management, the supervision of operations and compliance, preparation of regulatory filings, disclosures to Fund shareholders, general oversight of service providers, organizing Board meetings and preparing the materials for such Board meetings, assistance to the Board (including the Independent Trustees in their capacity as Trustees), legal and Chief Compliance Officer services for the Trust, and other services necessary for the operation of the Fund.

The Board considered the resources of the Investment Adviser and BBH, as a whole, dedicated to the Fund noting that, pursuant to separate agreements, BBH also provides custody, shareholder servicing, and fund accounting services to the Fund. The Board considered the depth and range of services provided pursuant to the Agreement, noting that the Investment Adviser also coordinates the provision of services to the Fund by affiliated and nonaffiliated service providers.

The Board considered the scope and quality of services provided by the Investment Adviser under the Agreement. The Board reviewed the qualifications of the key investment personnel primarily responsible for the day-to-day portfolio management of the Fund. The Board also considered the policies and practices followed by BBH and the Investment Adviser. The Board noted that during the course of its regular meetings, it received reports on each of the foregoing topics. The Board concluded that, overall, it was satisfied with the nature, extent and quality of the investment advisory and administrative services provided, and expected to be provided, to the Fund pursuant to the Agreement.

Fund Performance

At the November 16, 2023 and December 12, 2023 meetings, and throughout the year, the Board received and considered performance information for the Fund provided by BBH. The Board also considered the Fund’s performance relative to a peer category of other mutual funds in a report compiled by Broadridge. As part of this review, the Trustees considered the composition of the peer category, selection criteria and reputation of Broadridge who prepared the peer category analysis. The Board reviewed and discussed with both BBH and Broadridge the report’s findings and discussed the positioning of the Fund relative to

40

    

 

BBH LIMITED DURATION FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

its selected peer category. The Board considered short-term and long-term investment performance for the Fund over various periods of time as compared to a selection of peer category, noting the Fund’s above average performance in the 1-, 2-, 3-, 4-, 5- and 10-year periods, ended September 30, 2023. In evaluating the performance of the Fund, the Board considered the risk expectations for the Fund as well as the relevant market conditions for the Fund’s investments and investment strategy. Based on this information, and in light of the Fund’s historic investment style, the Board concluded that it was satisfied with the Fund’s investment results.

Costs of Services Provided and Profitability

The Board considered the fee rates paid by the Fund to the Investment Adviser in light of the nature, extent and quality of the services provided to the Fund. The Board also considered and reviewed the fee waiver arrangement that was in place for the Fund’s Class N shares and considered the actual fee rates after taking into account the contractual fee waiver. The Board received and considered information comparing the Fund’s combined investment advisory and administration fee and the Fund’s net operating expenses with those of other comparable mutual funds, such peer category and comparisons having been selected and calculated by Broadridge, noting that the Fund compared exceedingly well to the selected peer category. The Board recognized that it is difficult to make comparisons of the fee rate, or of combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds. The Board concluded that the advisory and administration fee appeared to be both reasonable in light of the services rendered and the result of arm’s length negotiations.

With regard to profitability, the Trustees considered the compensation and benefits flowing to the Investment Adviser and BBH, directly or indirectly. The Board reviewed profitability data for the Fund using data from October 1, 2022 through September 30, 2023, for both the Investment Adviser and BBH. The data also included the effect of revenue generated by the shareholder servicing, custody and fund accounting fees paid by the Fund to BBH and corresponding expenses. The Board conducted a detailed review of the expense allocation methods used in preparing the profitability data. The Board focused on profitability of the Investment Adviser and BBH’s relationships with the Fund before taxes and distribution expenses. The Board concluded that the Investment Adviser’s and BBH’s profitability was not excessive in light of the nature, extent and quality of services provided to the Fund.

The Board also considered the effect of fall-out benefits to the Investment Adviser and BBH such as the increased visibility of BBH’s investment management business due to the distribution of the Trust’s funds. The Board considered other benefits received by BBH and the Investment Adviser as a result of their relationships with the Fund. These other benefits include fees received for being the Fund’s administrator, custodian, fund accounting and shareholder servicing agent. In light of the costs of providing services pursuant to the Agreement as well as the Investment Adviser and BBH’s commitment to the Fund, the ancillary benefits that the Investment Adviser and BBH received were considered reasonable.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

41

 

BBH LIMITED DURATION FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Economies of Scale

The Board also considered the existence of economies of scale and whether those economies are passed along to the Fund’s shareholders through a graduated investment advisory fee schedule or other means, including any fee waivers by the Investment Adviser and BBH. The Board considered the fee schedule for the Fund on the information they had been provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Fund, there appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints apply. In light of the Fund’s current size and expense structure, the Board concluded that the current breakpoints for the Fund were reasonable. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the comparative performance, expense information, the cost of the services provided and the profits to be realized by the Investment Adviser.

  

42

    

 

BBH LIMITED DURATION FUND

CONFLICTS OF INTEREST

April 30, 2024 (unaudited)

BBH&Co., including the Investment Adviser, provides discretionary and non-discretionary investment management services and products to corporations, institutions and individual investors throughout the world. As a result, in the ordinary course of its businesses, BBH&Co., including the Investment Adviser, may engage in activities in which its interests or the interests of its clients may conflict with or be adverse to the interests of the Funds. In addition, certain of such clients (including the Funds) utilize the services of BBH&Co. for which they will pay to BBH&Co. customary fees and expenses that will not be shared with the Funds.

The Investment Adviser and the Sub-advisers have adopted and implemented policies and procedures that seek to manage conflicts of interest. Pursuant to such policies and procedures, the Investment Adviser and each Sub-adviser monitor a variety of areas, including compliance with fund investment guidelines, the investment in only those securities that have been approved for purchase, and compliance with their respective Code of Ethics.

The Trust also manages these conflicts of interest. For example, the Trust has designated a CCO and has adopted and implemented policies and procedures designed to manage the conflicts identified below and other conflicts that may arise in the course of the Funds’ operations in such a way as to safeguard the Funds from being negatively affected as a result of any such potential conflicts. From time to time, the Trustees receive reports from the Investment Adviser, the Sub-advisers and the Trust’s CCO on areas of potential conflict.

Investors should carefully review the following, which describes potential and actual conflicts of interest that BBH&Co., the Investment Adviser and Sub-advisers can face in the operation of their respective investment management services. This section is not, and is not intended to be, a complete enumeration or explanation of all of the potential conflicts of interest that may arise. The Investment Adviser, the Sub-advisers and the Funds has adopted policies and procedures reasonably designed to appropriately prevent, limit or mitigate the conflicts of interest described below. Additional information about potential conflicts of interest regarding the Investment Adviser is set forth in the Investment Adviser’s Form ADV. A copy of Part 1 and Part 2A of the Investment Adviser’s Form ADV is available on the SEC’s website (www.adviserinfo.sec.gov). In addition, many of the activities that create these conflicts of interest are limited and/or prohibited by law, unless an exception is available.

Other Clients and Allocation of Investment Opportunities. BBH&Co., the Investment Adviser, and the Sub-advisers manage funds and accounts of clients other than the Funds (“Other Clients”). In general, BBH&Co., the Investment Adviser, and the Sub-advisers face conflicts of interest when they render investment advisory services to different clients and, from time to time, provide dissimilar investment advice to different clients. Investment decisions will not necessarily be made in parallel among the Funds and Other Clients. Investments made by the Funds do not, and are not intended to, replicate the investments, or the investment methods and strategies, of Other Clients. Accordingly, such Other Clients may produce results that are materially different from those experienced by the Funds. Certain other conflicts of interest may arise in connection with a portfolio manager’s management of the Funds’ investments, on the one hand, and the investments of other funds or accounts for which the portfolio

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

43

 

BBH LIMITED DURATION FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

manager is responsible, on the other. For example, it is possible that the various funds or accounts managed by the Investment Adviser or Sub-advisers could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Funds. From time to time, the Investment Adviser and Sub-advisers, sponsor and with other investment pools and accounts which engage in the same or similar businesses as the Funds using the same or similar investment strategies. To the extent that the same investment opportunities might be desirable for more than one account or fund, possible conflicts could arise in determining how to allocate them because the Investment Adviser or Sub-advisers may have an incentive to allocate investment opportunities to certain accounts or funds. However, BBH&Co. and the Investment Adviser have implemented policies and procedures designed to ensure that information relevant to investment decisions is disseminated promptly within its portfolio management teams and investment opportunities are allocated equitably among different clients. The policies and procedures require, among other things, objective allocation for limited investment opportunities, and documentation and review of justifications for any decisions to make investments only for select accounts or in a manner disproportionate to the size of the account. Nevertheless, access to investment opportunities may be allocated differently among accounts due to the particular characteristics of an account, such as size of the account, cash position, tax status, risk tolerance and investment restrictions or for other reasons.

Actual or potential conflicts of interest may also arise when a portfolio manager has management responsibilities to multiple accounts or funds, resulting in unequal commitment of time and attention to the portfolio management of the funds or accounts.

Affiliated Service Providers. Other potential conflicts might include conflicts between the Funds and its affiliated and unaffiliated service providers (e.g., conflicting duties of loyalty). In addition to providing investment management services through the SID, BBH&Co. provides administrative, custody, shareholder servicing and fund accounting services to the Funds. BBH&Co. may have conflicting duties of loyalty while servicing the Funds and/or opportunities to further its own interest to the detriment of the Funds. For example, in negotiating fee arrangements with affiliated service providers, BBH&Co. may have an incentive to agree to higher fees than it would in the case of unaffiliated providers. BBH&Co. acting in its capacity as the Funds’ administrator is the primary valuation agent of the Funds. BBH&Co. values securities and assets in the Funds according to the Funds’ valuation policies. Because the Investment Adviser’s advisory and administrative fees are calculated by reference to a Funds’ net assets, BBH&Co. and its affiliates may have an incentive to seek to overvalue certain assets.

Aggregation. Potential conflicts of interest also arise with the aggregation of trade orders. Purchases and sales of securities for the Funds may be aggregated with orders for other client accounts managed by the Sub-advisers. The Sub-advisers, however, are not required to aggregate orders if portfolio management decisions for different accounts are made separately, or if it is determined that aggregating is not practicable, or in cases involving client direction. Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds will be charged or credited with the

44

    

 

BBH LIMITED DURATION FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

average price. Thus, the effect of the aggregation may operate on some occasions to the disadvantage of the Funds. In addition, under certain circumstances, the Funds will not be charged the same commission or commission equivalent rates in connection with an aggregated order.

Cross Trades. Under certain circumstances, the Investment Adviser, on behalf of the Funds, may seek to buy from or sell securities to another fund or account advised by BBH, the Investment Adviser. Subject to applicable law and regulation, BBH&Co., the Investment Adviser may (but is not required to) effect purchases and sales between BBH&Co., the Investment Adviser clients (“cross trades”), including the Funds, if BBH&Co., the Investment Adviser or a Fund’s Sub-adviser believes such transactions are appropriate based on each party’s investment objectives and guidelines. There may be potential conflicts of interest or regulatory issues relating to these transactions which could limit the Investment Adviser’s decision to engage in these transactions for the Funds. BBH&Co., the Investment Adviser and/or a Fund’s Sub-adviser may have a potentially conflicting division of loyalties and responsibilities to the parties in such transactions.

Soft Dollars. The Investment Adviser may direct brokerage transactions and/or payment of a portion of client commissions (“soft dollars”) to specific brokers or dealers or other providers to pay for research or other appropriate services which provide, in the Investment Adviser’s view, appropriate assistance in the investment decision-making process (including with respect to futures, fixed price offerings and over-the-counter transactions). The use of a broker that provides research and securities transaction services may result in a higher commission than that offered by a broker who does not provide such services. The Investment Adviser will determine in good faith whether the amount of commission is reasonable in relation to the value of research and services provided and whether the services provide lawful and appropriate assistance in its investment decision-making responsibilities.

Research or other services obtained in this manner may be used in servicing any or all of the Funds and other accounts managed by the Investment Adviser, including in connection with accounts that do not pay commissions to the broker related to the research or other service arrangements. Such products and services may disproportionately benefit other client accounts relative to the Funds based on the amount of brokerage commissions paid by the Funds and such other accounts. To the extent that a Sub-adviser uses soft dollars, it will not have to pay for those products and services itself.

BBH&Co. may receive research that is bundled with the trade execution, clearing, and/or settlement services provided by a particular broker-dealer. To the extent that a Sub-adviser receives research on this basis, many of the same conflicts related to traditional soft dollars may exist. For example, the research effectively will be paid by client commissions that also will be used to pay for the execution, clearing, and settlement services provided by the broker-dealer and will not be paid by the Sub-adviser.

Arrangements regarding compensation and delegation of responsibility may create conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades, administration of investment advice and valuation of securities.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

45

 

BBH LIMITED DURATION FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Investments in BBH Funds. From time to time BBH&Co. may invest a portion of the assets of its discretionary investment advisory clients in the Funds. That investment by BBH&Co. on behalf of its discretionary investment advisory clients in the Funds may be significant at times.

Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of scale that tend to reduce the Funds’ expense ratio. In selecting the Funds for its discretionary investment advisory clients, BBH&Co. may limit its selection to funds managed by BBH&Co. or the Investment Adviser. BBH&Co. may not consider or canvass the universe of unaffiliated investment companies available, even though there may be unaffiliated investment companies that may be more appropriate or that have superior performance. BBH&Co., the Investment Adviser and their affiliates providing services to the Funds benefit from additional fees when the Funds is included as an investment by a discretionary investment advisory client.

BBH&Co. reserves the right to redeem at any time some or all of the shares of the Funds acquired for its discretionary investment advisory clients’ accounts. A large redemption of shares of the Funds by BBH&Co. on behalf of its discretionary investment advisory clients could significantly reduce the asset size of the Funds, which might have an adverse effect on the Funds’ investment flexibility, portfolio diversification and expense ratio.

Valuation. When market quotations are not readily available or are believed by BBH&Co. to be unreliable, the Funds’ investments will be valued at fair value by BBH&Co. pursuant to procedures adopted by the Funds’ Board. When determining an asset’s “fair value,” BBH&Co. seeks to determine the price that a Fund might reasonably expect to receive from the current sale of that asset in an arm’s-length transaction. The price generally may not be determined based on what the Funds might reasonably expect to receive for selling an asset at a later time or if it holds the asset to maturity. While fair value determinations will be based upon all available factors that BBH&Co. deems relevant at the time of the determination and may be based on analytical values determined by BBH&Co. using proprietary or third-party valuation models, fair value represents only a good faith approximation of the value of a security. The fair value of one or more securities may not, in retrospect, be the price at which those assets could have been sold during the period in which the particular fair values were used in determining the Funds’ net asset value. As a result, the Funds’ sale or redemption of its shares at net asset value, at a time when a holding or holdings are valued by BBH&Co. (pursuant to Board-adopted procedures) at fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.

Referral Arrangements. BBH&Co. may enter into advisory and/or referral arrangements with third parties. Such arrangements may include compensation paid by BBH&Co. to the third party. BBH&Co. may pay a solicitation fee for referrals and/or advisory or incentive fees. BBH&Co. may benefit from increased amounts of assets under management.

  

46

    

 

BBH LIMITED DURATION FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Personal Trading. BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, face conflicts of interest when transacting in securities for their own accounts because they could benefit by trading in the same securities as the Funds, which could have an adverse effect on the Funds. However, the Investment Adviser has implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policy and procedures are intended to prevent BBH&Co. Partners and employees from trading in the same securities as the Funds. However, BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policies and procedures are intended to prevent BBH&Co. Partners and employees with access to Fund material non-public information from trading in the same securities as the Funds.

Gifts and Entertainment. From time to time, employees of BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, may receive gifts and/or entertainment from clients, intermediaries, or service providers to the Funds or BBH&Co., including the Investment Adviser, which could have the appearance of affecting or may potentially affect the judgment of the employees, or the manner in which they conduct business. The Investment Adviser has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees. BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

47

 

BBH LIMITED DURATION FUND

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM

April 30, 2024 (unaudited)

The Securities and Exchange Commission adopted Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), to promote effective liquidity risk management throughout the open-end investment company industry in order to reduce the risk that funds will be unable to meet their redemption obligations and mitigate dilution of the interests of fund shareholders.

The Board of Trustees (the “Board”) of BBH Trust has appointed three members of the Brown Brothers Harriman & Co. Mutual Fund Advisory Department, the Investment Adviser to the funds of BBH Trust (the “Funds”), as the Program Administrator for each Fund’s liquidity risk management program (the “Program”). The Board met on March 6, 2024 to review the Program for the Funds pursuant to the Liquidity Rule. The Program Administrator provided the Board with a report (the “Report”) that addressed the operations of the Program and assessed its adequacy and effectiveness for the period from February 1, 2023 through January 31, 2024 (the “Reporting Period”).

The Report noted that the Program complied with the key factors for consideration under the Liquidity Rule for assessing, managing and periodically reviewing a Fund’s liquidity risk, including the following points.

Liquidity classification. The Report described the Program’s liquidity classification methodology for categorizing the Funds’ investments into one of four liquidity buckets. The Funds classified each of their investments into one of four liquidity categories based on the number of days reasonably needed to sell and convert a reasonably anticipated sized trade of each investment into cash without significantly impacting the price of the investments. The Program Administrator relied on a third-party data provider to facilitate the classification of each Fund’s investments based on criteria in each Fund’s Program. During the Reporting Period, no Fund held more than 15% of its net assets in illiquid investments.

Highly Liquid Investment Minimum. The Report noted that one aspect of the Liquidity Rule is a requirement that funds that are expected to have less than 50% of assets classified as other than “highly liquid” should establish a minimum percentage of highly liquid assets that the fund is expected to hold on an on-going basis. The Program Administrator monitors the percentages of assets in each category on an ongoing basis and, given that no Fund has approached the 50% threshold, has made the determination that it is not necessary to assign a Highly Liquid Investment Minimum to any of the Funds as provided for in the Liquidity Rule.

The Fund’s investment strategy and liquidity of portfolio investments during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed whether each Fund’s investment strategy is appropriate for an open-end fund structure with a focus on Funds with more significant and consistent holdings of less liquid and illiquid assets and factored a Fund’s concentration in an issuer into the liquidity classification methodology by taking issuer position sizes into account.

Short-term and long-term cash flow projections during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed historical redemption activity and used this information as a component to establish each Fund’s reasonably

48

    

 

BBH LIMITED DURATION FUND

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM (continued)

April 30, 2024 (unaudited)

anticipated trading size. The Program Administrator also took into consideration other factors such as shareholder ownership concentration, applicable distribution channels and the degree of certainty associated with a Fund’s short-term and long-term cash flow projections.

Holdings of cash and cash equivalents. The Program Administrator considered the degree to which each Fund held cash and cash equivalents as a component of each Fund’s ability to meet redemption requests.

There were no material changes to the Program during the Reporting Period. The Program Administrator has informed the Board that it believes that the Fund’s Program is adequately designed, has been implemented as intended, and has operated effectively since its implementation. No material exceptions have been noted since the implementation of the Program, and there were no liquidity events that impacted the Fund or its ability to meet redemption requests on a timely basis during the Reporting Period.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

49

 

Administrator
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005

Distributor
Alps Distributors, Inc.
1290 Broadway, Suite 1000
Denver, Co 80203

Shareholder Servicing Agent
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005
1-800-575-1265

To obtain information or make shareholder inquiries:

  

Investment Adviser
Brown Brothers Harriman
Mutual Fund Advisory Department
140 Broadway
New York, NY 10005

By telephone:
By E-mail send your request to:
On the internet:

  

Call 1-800-575-1265
bbhfunds@bbh.com
www.bbhfunds.com

This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund.

For more complete information, visit www.bbhfunds.com for a prospectus. You should consider the Fund’s investment objectives, risks, charges and expenses carefully before you invest. Information about these and other important subjects is in the Fund’s prospectus, which you should read carefully before investing.

Holdings and allocations are subject to change. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities. Current and future holdings are subject to risk.

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Forms N-PORT are available electronically on the SEC’s website (sec.gov). For a complete list of a fund’s portfolio holdings, view the most recent holdings listing, semi-annual report, or annual report on the Fund’s website at http://www.bbhfunds.com.

A summary of the Fund’s Proxy Voting Policy that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund’s portfolio, as well as a record of how the Fund voted any such proxies during the most recent 12-month period ended June 30, is available, without charge, upon request by calling the toll-free number listed above. This information is also available on the SEC’s website at www.sec.gov.

NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE

 

    

Semi-Annual Report

APRIL 30, 2024

BBH Income Fund

 

BBH INCOME FUND

PORTFOLIO ALLOCATION

April 30, 2024 (unaudited)

BREAKDOWN BY SECURITY TYPE

 

U.S. $ Value

  

Percent of
Net Assets

Asset Backed Securities

  

$

200,956,904

 

  

20.1

%

Commercial Mortgage Backed Securities

  

 

65,024,937

 

  

6.5

 

Corporate Bonds

  

 

419,213,644

 

  

42.0

 

Loan Participations and Assignments

  

 

117,144,904

 

  

11.7

 

Municipal Bonds

  

 

1,086,280

 

  

0.1

 

Preferred Securities

  

 

25,651,914

 

  

2.6

 

Residential Mortgage Backed Securities

  

 

793,137

 

  

0.1

 

U.S. Government Agency Obligations

 

 

15,200,000

 

  

1.5

 

U.S. Treasury Bills

  

 

4,320,382

 

  

0.4

 

U.S. Treasury Bonds and Notes

  

 

158,697,253

 

  

15.9

 

Liabilities in Excess of Cash and Other Assets

 

 

(9,245,402

)

  

(0.9

)

NET ASSETS

  

$

998,843,953

 

  

100.0

%

All data as of April 30, 2024. The BBH Income Fund’s (the “Fund”) breakdown by security type is expressed as a percentage of net assets and may vary over time.

The accompanying notes are an integral part of these financial statements.

2

    

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

ASSET BACKED SECURITIES (20.1%)

        

 

  

 

  

$

4,054,399

  

ABPCI Direct Lending Fund ABS I, Ltd. 2020-1A1

  

12/20/30

  

3.199

%

  

$

3,916,675

 

2,261,310

  

ABPCI Direct Lending Fund ABS II LLC 2022-2A1

  

03/01/32

  

4.987

 

  

 

2,041,670

 

2,630,000

  

Adams Outdoor Advertising LP 2023-11

  

07/15/53

  

6.967

 

  

 

2,684,627

 

3,250,000

  

Aligned Data Centers Issuer LLC 2023-1A1

  

08/17/48

  

6.000

 

  

 

3,191,616

 

1,480,000

  

Ares PBN Finance Co. LLC1,2

  

10/15/36

  

6.000

 

  

 

1,444,924

 

5,200,000

  

Avis Budget Rental Car Funding AESOP LLC 2023-4A1

  

06/20/29

  

5.490

 

  

 

5,147,848

 

1,044,380

  

BHG Securitization Trust 2022-A1

  

02/20/35

  

1.710

 

  

 

1,028,578

 

4,165,000

  

BHG Securitization Trust 2023-A1

  

04/17/36

  

6.350

 

  

 

4,103,702

 

4,860,000

  

Business Jet Securities LLC 2024-1A1

  

05/15/39

  

6.197

 

  

 

4,829,110

 

1,430,000

  

CARS-DB4 LP 2020-1A1

  

02/15/50

  

4.170

 

  

 

1,383,801

 

3,424,844

  

CARS-DB7 LP 2023-1A1

  

09/15/53

  

6.500

 

  

 

3,365,765

 

1,025,375

  

CF Hippolyta Issuer LLC 2020-11

  

07/15/60

  

2.280

 

  

 

942,693

 

2,374,427

  

CF Hippolyta Issuer LLC 2022-1A1

  

08/15/62

  

5.970

 

  

 

2,315,613

 

8,990,000

  

Cogent Ipv4 LLC 2024-1A1

  

05/25/54

  

7.924

 

  

 

8,993,596

 

2,330,000

  

Credit Acceptance Auto Loan Trust 2023-1A1

  

07/15/33

  

7.710

 

  

 

2,373,893

 

3,070,000

  

DataBank Issuer 2023-1A1

  

02/25/53

  

5.116

 

  

 

2,875,092

 

2,850,000

  

DigitalBridge Issuer LLC 2021-1A1

  

09/25/51

  

3.933

 

  

 

2,639,670

 

4,630,000

  

Dryden 115 CLO, Ltd. 2024-115A (3-Month CME Term SOFR + 2.000%)1,3

  

04/18/37

  

7.301

 

  

 

4,643,488

 

384,450

  

Elm Trust 2020-3A1

  

08/20/29

  

2.954

 

  

 

367,993

 

1,138,870

  

Elm Trust 2020-4A1

  

10/20/29

  

2.286

 

  

 

1,081,547

 

4,460,000

  

Flexential Issuer 2021-1A1

  

11/27/51

  

3.250

 

  

 

4,037,020

 

538,891

  

FNA LLC 2019-11,2,3,4

  

12/10/31

  

3.000

 

  

 

508,174

 

3,340,000

  

Ford Credit Auto Owner Trust 2024-11

  

08/15/36

  

4.870

 

  

 

3,268,364

 

39,434

  

FREED ABS Trust 2022-2CP1

  

05/18/29

  

4.490

 

  

 

39,393

 

1,094,193

  

Global SC Finance VII Srl 2020-1A1

  

10/17/40

  

2.170

 

  

 

1,006,794

 

1,033,259

  

Global SC Finance VII Srl 2020-2A1

  

11/19/40

  

2.260

 

  

 

948,165

 

3,684,898

  

Golub Capital Partners ABS Funding, Ltd. 2021-1A1

  

04/20/29

  

2.773

 

  

 

3,476,509

 

6,810,000

  

Hartwick Park CLO, Ltd. 2023-1A (3-Month CME Term SOFR + 2.250%)1,3

  

01/21/36

  

7.591

 

  

 

6,810,708

 

2,980,000

  

HPEFS Equipment Trust 2023-1A1

  

04/20/28

  

5.730

 

  

 

2,977,065

 

2,540,000

  

Lendmark Funding Trust 2023-1A1

  

05/20/33

  

5.590

 

  

 

2,526,695

 

448,264

  

LIAS Administration Fee Issuer LLC 2018-1A

  

07/25/48

  

5.956

 

  

 

406,789

 

4,340,000

  

Madison Park Funding LXVII, Ltd. 2024-67A (3-Month CME Term SOFR + 2.050%)1,3

  

04/25/37

  

7.340

 

  

 

4,323,236

 

3,060,000

  

Madison Park Funding XLVII, Ltd. 2020-47A (3-Month CME Term SOFR + 1.950%)1,3

  

04/19/37

  

7.277

 

  

 

3,048,952

 

344,971

  

Mariner Finance Issuance Trust 2020-AA1

  

08/21/34

  

2.190

 

  

 

340,572

 

1,840,000

  

MCF CLO 10, Ltd. 2023-1A (3-Month CME Term SOFR + 4.200%)1,3

  

04/15/35

  

9.529

 

  

 

1,846,195

 

1,065,620

  

Monroe Capital ABS Funding, Ltd. 2021-1A1

  

04/22/31

  

2.815

 

  

 

1,008,294

 

1,870,000

  

Monroe Capital ABS Funding II, Ltd. 2023-1A1

  

04/22/33

  

6.650

 

  

 

1,872,090

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

3

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

ASSET BACKED SECURITIES (continued)

        

 

  

 

  

$

1,790,000

  

Monroe Capital Income Plus ABS Funding LLC 2022-1A1

  

04/30/32

  

5.150

%

  

$

1,564,945

 

2,465,000

  

Navistar Financial Dealer Note Master Owner Trust II 2023-11

  

08/25/28

  

6.180

 

  

 

2,469,556

 

2,700,000

  

Neuberger Berman Loan Advisers CLO 40, Ltd. 2021-40A (3-Month CME Term SOFR + 1.322%)1,3

  

04/16/33

  

6.649

 

  

 

2,703,888

 

140,866

  

Newtek Small Business Loan Trust 2018-1 (U.S. Prime Rate - 0.550%)1,3

  

02/25/44

  

7.950

 

  

 

139,846

 

66,821

  

Newtek Small Business Loan Trust 2018-1 (U.S. Prime Rate + 0.750%)1,3

  

02/25/44

  

9.250

 

  

 

66,457

 

3,276,066

  

Newtek Small Business Loan Trust 2023-1 (U.S. Prime Rate - 0.500%)1,3

  

07/25/50

  

8.000

 

  

 

3,267,901

 

3,550,000

  

NextGear Floorplan Master Owner Trust 2022-1A1

  

03/15/27

  

2.800

 

  

 

3,456,396

 

5,440,000

  

NextGear Floorplan Master Owner Trust 2023-1A1

  

03/15/28

  

5.740

 

  

 

5,448,349

 

1,660,000

  

NFAS2 LLC 2022-11

  

09/15/28

  

6.860

 

  

 

1,634,300

 

3,960,000

  

Niagara Park CLO, Ltd. 2019-1A (3-Month CME Term SOFR + 1.262%)1,3

  

07/17/32

  

6.579

 

  

 

3,958,812

 

4,500,000

  

Octagon 71, Ltd. 2024-1A (3-Month CME Term SOFR + 2.050%)1,3

  

04/18/37

  

7.341

 

  

 

4,509,557

 

2,180,000

  

OnDeck Asset Securitization Trust III LLC 2021-1A1

  

05/17/27

  

1.590

 

  

 

2,174,790

 

2,930,000

  

OneMain Financial Issuance Trust 2022-S11

  

05/14/35

  

4.130

 

  

 

2,853,541

 

6,610,000

  

OneMain Financial Issuance Trust 2023-2A1

  

09/15/36

  

6.170

 

  

 

6,649,053

 

5,630,000

  

Oportun Issuance Trust 2021-C1

  

10/08/31

  

2.180

 

  

 

5,306,478

 

649,133

  

Oxford Finance Funding LLC 2020-1A1

  

02/15/28

  

3.101

 

  

 

639,234

 

2,320,000

  

PennantPark CLO VII LLC 2023-7A (3-Month CME Term SOFR + 4.050%)1,3

  

07/20/35

  

9.375

 

  

 

2,350,614

 

305,287

  

ReadyCap Lending Small Business Loan Trust 2019-2 (U.S. Prime Rate - 0.500%)1,3

  

12/27/44

  

8.000

 

  

 

305,498

 

5,150,000

  

Regional Management Issuance Trust 2022-11

  

03/15/32

  

3.070

 

  

 

4,928,355

 

779,836

  

Republic Finance Issuance Trust 2020-A1

  

11/20/30

  

2.470

 

  

 

771,906

 

5,240,000

  

Retained Vantage Data Centers Issuer LLC 2023-1A1

  

09/15/48

  

5.000

 

  

 

4,962,409

 

2,130,000

  

Sabey Data Center Issuer LLC 2020-11

  

04/20/45

  

3.812

 

  

 

2,064,149

 

1,795,000

  

Sabey Data Center Issuer LLC 2023-11

  

04/20/48

  

6.250

 

  

 

1,787,807

 

2,240,000

  

Santander Drive Auto Receivables Trust 2023-5

  

02/18/31

  

6.430

 

  

 

2,281,601

 

6,250,000

  

Sotheby’s Artfi Master Trust 2024-1A1

  

12/22/31

  

6.430

 

  

 

6,246,463

 

2,310,000

  

Southwick Park CLO LLC 2019-4A (3-Month CME Term SOFR + 1.322%)1,3

  

07/20/32

  

6.646

 

  

 

2,310,020

 

1,150,000

  

Stack Infrastructure Issuer LLC 2023-1A1

  

03/25/48

  

5.900

 

  

 

1,130,962

 

3,520,000

  

Stack Infrastructure Issuer LLC 2023-3A1

  

10/25/48

  

5.900

 

  

 

3,470,663

 

123,833

  

SWC Funding LLC 2018-1A1

  

08/15/33

  

4.750

 

  

 

123,671

 

1,137,974

  

Textainer Marine Containers VII, Ltd. 2020-1A1

  

08/21/45

  

2.730

 

  

 

1,056,744

 

4,388,843

  

Thrust Engine Leasing DAC 2021-1A1

  

07/15/40

  

4.163

 

  

 

4,017,240

 

2,620,000

  

TierPoint Issuer LLC 2023-1A1

  

06/25/53

  

6.000

 

  

 

2,515,400

The accompanying notes are an integral part of these financial statements.

4

    

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

ASSET BACKED SECURITIES (continued)

        

 

  

 

  

$

3,350,000

  

Vantage Data Centers Issuer LLC 2023-1A1

  

03/16/48

  

6.316

%

  

$

3,321,891

 

4,916,356

  

VC 3 LS LP 2021-B1,2

  

10/15/41

  

4.750

 

  

 

3,955,208

 

1,574,115

  

VCP RRL ABS I, Ltd. 2021-1A1

  

10/20/31

  

2.152

 

  

 

1,483,561

 

4,830,000

  

Westlake Automobile Receivables Trust 2023-2A1

  

03/15/28

  

6.290

 

  

 

4,850,086

 

2,253,500

  

Willis Engine Structured Trust VII 2023-A1

  

10/15/48

  

8.000

 

  

 

2,362,637

 

    

Total Asset Backed Securities
(Cost $204,684,757)

 

  

 

200,956,904

 

              

 

  

 

  

 

    

COMMERCIAL MORTGAGE BACKED SECURITIES (6.5%)

        

 

  

 

  

 

1,390,000

  

BPR Trust 2022-OANA (1-Month CME Term SOFR + 2.697%)1,3

  

04/15/37

  

8.018

 

  

 

1,386,525

 

4,740,000

  

BX Commercial Mortgage Trust 2022-CSMO (1-Month CME Term SOFR + 3.889%)1,3

  

06/15/27

  

9.209

 

  

 

4,763,700

 

1,106,902

  

BXMT, Ltd. 2020-FL2 (1-Month CME Term SOFR + 1.014%)1,3

  

02/15/38

  

6.331

 

  

 

1,061,770

 

1,250,000

  

BXMT, Ltd. 2020-FL3 (1-Month CME Term SOFR + 2.664%)1,3

  

11/15/37

  

7.981

 

  

 

1,060,432

 

786,000

  

CG-CCRE Commercial Mortgage Trust 2014-FL2 (1-Month CME Term SOFR + 4.114%)1,3

  

11/15/31

  

8.142

 

  

 

547,927

 

144,567

  

CG-CCRE Commercial Mortgage Trust 2014-FL2 (1-Month CME Term SOFR + 4.114%)1,2,3

  

11/15/31

  

9.436

 

  

 

104,290

 

1,361,180

  

CG-CCRE Commercial Mortgage Trust 2014-FL2 (1-Month CME Term SOFR + 4.864%)1,2,3

  

11/15/31

  

10.186

 

  

 

645,199

 

2,870,000

  

Citigroup Commercial Mortgage Trust 2023-PRM31,3,4

  

07/10/28

  

6.360

 

  

 

2,861,683

 

4,590,000

  

Commercial Mortgage Pass Through Certificate1

  

07/12/28

  

7.121

 

  

 

4,708,292

 

2,460,000

  

DC Commercial Mortgage Trust 2023-DC1

  

09/12/40

  

6.804

 

  

 

2,477,384

 

7,330,000

  

DK Trust 2024-SPBX (1-Month CME Term SOFR + 1.750%)1,3

  

03/15/34

  

7.071

 

  

 

7,316,256

 

7,660,000

  

Freddie Mac Multifamily Structured Pass Through Certificates 2023-K7531,2,5

  

12/25/30

  

0.000

 

  

 

3,750,336

 

26,240,000

  

Freddie Mac Multifamily Structured Pass Through Certificates 2023-K7531

  

12/25/30

  

0.100

 

  

 

122,040

 

126,956,393

  

Freddie Mac Multifamily Structured Pass Through Certificates 2023-K7531

  

01/01/50

  

0.100

 

  

 

572,789

 

7,660,000

  

Freddie Mac Multifamily Structured Pass Through Certificates K7533,4

  

12/25/30

  

5.208

 

  

 

1,933,909

 

4,220,000

  

FREMF Mortgage Trust 2024-K5161,2,3,4

  

01/25/29

  

6.122

 

  

 

3,577,716

 

1,000,000

  

Hudsons Bay Simon JV Trust 2015-HB101,3,4

  

08/05/34

  

5.447

 

  

 

814,421

 

3,150,000

  

INTOWN Mortgage Trust 2022-STAY (1-Month CME Term SOFR + 4.134%)1,3

  

08/15/39

  

9.455

 

  

 

3,166,734

 

240,000

  

JPMBB Commercial Mortgage Securities Trust 2014-C241,3,4

  

11/15/47

  

4.013

 

  

 

176,685

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

5

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

COMMERCIAL MORTGAGE BACKED SECURITIES (continued)

        

 

  

 

  

$

5,240,000

  

MED Commercial Mortgage Trust 2024-MOB (1-Month CME Term SOFR + 1.592%)1,3

  

05/15/41

  

6.902

%

  

$

5,226,898

 

2,326,739

  

Morgan Stanley Capital I Trust 2019-BPR (1-Month CME Term SOFR + 1.992%)1,3

  

05/15/36

  

7.320

 

  

 

2,321,777

 

5,860,000

  

MTN Commercial Mortgage Trust 2022-LPFL (1-Month CME Term SOFR + 1.896%)1,3

  

03/15/39

  

7.226

 

  

 

5,753,788

 

1,058,537

  

NADG NNN Operating LP 2019-11

  

12/28/49

  

3.368

 

  

 

1,019,174

 

2,635,877

  

Ready Capital Mortgage Financing LLC 2021-FL7 (1-Month CME Term SOFR + 1.314%)1,3

  

11/25/36

  

6.631

 

  

 

2,623,146

 

2,700,000

  

SCOTT Trust 2023-SFS1

  

03/15/40

  

5.910

 

  

 

2,671,618

 

2,270,000

  

SPGN Mortgage Trust 2022-TFLM (1-Month CME Term SOFR + 2.650%)1,3

  

02/15/39

  

7.971

 

  

 

2,202,545

 

1,310,000

  

SPGN Mortgage Trust 2022-TFLM (1-Month CME Term SOFR + 3.500%)1,3

  

02/15/39

  

8.821

 

  

 

1,268,816

 

890,000

  

STWD, Ltd. 2019-FL1 (1-Month CME Term SOFR + 1.714%)1,3

  

07/15/38

  

7.035

 

  

 

880,155

 

9,507

  

UBS-BAMLL Trust 2012-WRM1

  

06/10/30

  

3.663

 

  

 

8,932

 

    

Total Commercial Mortgage Backed Securities
(Cost $66,741,973)

 

  

 

65,024,937

 

              

 

  

 

  

 

    

CORPORATE BONDS (42.0%)

        

 

  

 

  

 

    

AEROSPACE/DEFENSE (0.4%)

        

 

  

 

  

 

2,220,000

  

BAE Systems, Plc.1

  

04/15/30

  

3.400

 

  

 

1,974,323

 

1,708,000

  

Spirit AeroSystems, Inc.1

  

11/30/29

  

9.375

 

  

 

1,847,238

 

              

 

  

 

3,821,561

 

    

AGRICULTURE (0.2%)

        

 

  

 

  

 

1,890,000

  

Cargill, Inc.1

  

10/11/32

  

5.125

 

  

 

1,846,302

 

              

 

  

 

  

 

    

AIRLINES (0.5%)

        

 

  

 

  

 

4,955,000

  

Hawaiian Brand Intellectual Property, Ltd. / HawaiianMiles Loyalty, Ltd.1

  

01/20/26

  

5.750

 

  

 

4,647,242

 

              

 

  

 

  

 

    

BANKS (9.0%)

        

 

  

 

  

 

2,790,000

  

ASB Bank, Ltd. (5-Year CMT Index + 2.250%)1,3

  

06/17/32

  

5.284

 

  

 

2,722,761

 

4,600,000

  

Banco Santander S.A. (1-Year CMT Index + 1.250%)3

  

03/14/28

  

5.552

 

  

 

4,543,544

 

1,635,000

  

Bank Leumi Le-Israel BM1

  

07/27/27

  

5.125

 

  

 

1,571,912

 

5,910,000

  

Bank of America Corp. (5-Year CMT Index + 2.760%)3,6

      

4.375

 

  

 

5,420,162

 

3,035,000

  

Bank of New Zealand1

  

02/07/28

  

4.846

 

  

 

2,963,792

 

3,095,000

  

Bank of Nova Scotia

  

03/11/27

  

2.951

 

  

 

2,893,375

 

3,485,000

  

Canadian Imperial Bank of Commerce

  

10/03/28

  

5.986

 

  

 

3,545,012

 

2,665,000

  

Comerica Bank

  

07/27/25

  

4.000

 

  

 

2,579,944

 

2,920,000

  

Comerica Bank (SOFR + 2.610%)3

  

08/25/33

  

5.332

 

  

 

2,555,804

 

6,240,000

  

Fifth Third Bancorp (SOFR + 2.192%)3

  

10/27/28

  

6.361

 

  

 

6,290,396

The accompanying notes are an integral part of these financial statements.

6

    

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

CORPORATE BONDS (continued)

        

 

  

 

  

 

    

BANKS (continued)

        

 

  

 

  

$

165,000

  

Fifth Third Bancorp (SOFR + 2.127%)3

  

07/28/30

  

4.772

%

  

$

155,630

 

2,140,000

  

HSBC Holdings, Plc (SOFR + 3.350%)3

  

11/03/28

  

7.390

 

  

 

2,243,439

 

1,140,000

  

HSBC Holdings, Plc (SOFR + 2.387%)3

  

06/04/31

  

2.848

 

  

 

961,340

 

3,285,000

  

HSBC Holdings, Plc (SOFR + 2.390%)3

  

03/09/34

  

6.254

 

  

 

3,355,177

 

6,256,000

  

Huntington Bancshares, Inc. (SOFR + 1.970%)3

  

08/04/28

  

4.443

 

  

 

5,993,232

 

2,160,000

  

Lloyds Banking Group, Plc. (1-Year CMT Index + 1.700%)3

  

03/06/29

  

5.871

 

  

 

2,163,427

 

2,025,000

  

Lloyds Banking Group, Plc. (1-Year CMT Index + 3.750%)3

  

11/15/33

  

7.953

 

  

 

2,222,657

 

2,000,000

  

Morgan Stanley (SOFR + 1.610%)3

  

04/20/28

  

4.210

 

  

 

1,926,498

 

2,055,000

  

Morgan Stanley (SOFR + 2.560%)3

  

10/18/33

  

6.342

 

  

 

2,131,353

 

2,810,000

  

National Australia Bank, Ltd.1

  

01/12/33

  

6.429

 

  

 

2,882,200

 

2,445,000

  

NatWest Group, Plc (1-Year CMT Index + 2.850%)3

  

11/10/26

  

7.472

 

  

 

2,501,216

 

1,780,000

  

NatWest Group, Plc (1-Year CMT Index + 2.100%)3

  

03/02/34

  

6.016

 

  

 

1,780,508

 

2,360,000

  

Santander Holdings USA, Inc. (SOFR + 2.356%)3

  

03/09/29

  

6.499

 

  

 

2,378,310

 

3,070,000

  

Skandinaviska Enskilda Banken AB1

  

03/05/29

  

5.375

 

  

 

3,017,596

 

1,620,000

  

Truist Financial Corp. (SOFR + 2.446%)3

  

10/30/29

  

7.161

 

  

 

1,696,263

 

4,445,000

  

Truist Financial Corp. (SOFR + 1.620%)3

  

01/24/30

  

5.435

 

  

 

4,354,210

 

1,525,000

  

UBS Group AG (1-Year CMT Index + 1.750%)1,3

  

05/12/28

  

4.751

 

  

 

1,476,159

 

4,025,000

  

UBS Group AG (1-Year CMT Index + 2.200%)1,3

  

01/12/34

  

5.959

 

  

 

3,994,979

 

6,100,000

  

US Bancorp (5-Year CMT Index + 2.541%)3,6

      

3.700

 

  

 

5,249,535

 

1,245,000

  

Wells Fargo & Co. (SOFR + 2.000%)3

  

04/30/26

  

2.188

 

  

 

1,200,353

 

1,165,000

  

Wells Fargo & Co. (SOFR + 2.100%)3

  

06/02/28

  

2.393

 

  

 

1,059,161

 

3,020,000

  

Wells Fargo & Co. (SOFR + 1.500%)3

  

03/02/33

  

3.350

 

  

 

2,549,365

 

              

 

  

 

90,379,310

 

    

BEVERAGES (0.3%)

        

 

  

 

  

 

3,170,000

  

Keurig Dr Pepper, Inc.

  

03/15/29

  

5.050

 

  

 

3,123,517

 

              

 

  

 

  

 

    

DIVERSIFIED FINANCIAL SERVICES (4.4%)

        

 

  

 

  

 

4,365,000

  

Ally Financial, Inc. (SOFR + 2.820%)3

  

01/03/30

  

6.848

 

  

 

4,410,392

 

1,265,000

  

American Express Co.

  

03/04/27

  

2.550

 

  

 

1,170,284

 

1,250,000

  

American Express Co. (SOFR + 2.255%)3

  

05/26/33

  

4.989

 

  

 

1,182,448

 

2,685,000

  

Avolon Holdings Funding, Ltd.1

  

07/01/24

  

3.950

 

  

 

2,674,860

 

925,000

  

Avolon Holdings Funding, Ltd.1

  

01/15/26

  

5.500

 

  

 

911,393

 

5,705,000

  

Bread Financial Holdings, Inc.1

  

03/15/29

  

9.750

 

  

 

5,932,869

 

2,338,000

  

Brightsphere Investment Group, Inc.

  

07/27/26

  

4.800

 

  

 

2,250,535

 

2,345,000

  

Capital One Financial Corp.

  

05/11/27

  

3.650

 

  

 

2,218,263

 

1,630,000

  

Capital One Financial Corp. (SOFR + 3.070%)3

  

10/30/31

  

7.624

 

  

 

1,754,043

 

4,125,000

  

Credit Acceptance Corp.1

  

12/15/28

  

9.250

 

  

 

4,373,531

 

2,485,000

  

Drawbridge Special Opportunities Fund LP / Drawbridge Special Opportunities Finance1

  

02/15/26

  

3.875

 

  

 

2,343,022

 

2,550,000

  

GCM Grosvenor Diversified Alternatives Issuer LLC1,2

  

11/15/41

  

6.000

 

  

 

2,002,005

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

7

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

CORPORATE BONDS (continued)

        

 

  

 

  

 

    

DIVERSIFIED FINANCIAL SERVICES (continued)

        

 

  

 

  

$

7,300,000

  

Oxford Finance LLC / Oxford Finance Co.-Issuer II, Inc.1

  

02/01/27

  

6.375

%

  

$

6,849,812

 

4,620,000

  

Sculptor Alternative Solutions LLC1,2

  

05/15/37

  

6.000

 

  

 

3,867,864

 

2,655,000

  

Strategic Credit Opportunities Partners LLC

  

04/01/26

  

4.250

 

  

 

2,485,818

 

              

 

  

 

44,427,139

 

    

ELECTRIC (2.9%)

        

 

  

 

  

 

1,840,000

  

Alabama Power Co.

 

03/15/32

  

3.050

 

  

 

1,566,646

 

4,160,000

  

Alexander Funding Trust II1

  

07/31/28

  

7.467

 

  

 

4,340,362

 

2,100,000

  

Duke Energy Florida LLC

  

11/15/52

  

5.950

 

  

 

2,113,847

 

1,880,000

  

Duke Energy Ohio, Inc.

  

04/01/53

  

5.650

 

  

 

1,801,304

 

5,065,000

  

Edison International (5-Year CMT Index + 4.698%)3,6

      

5.375

 

  

 

4,852,244

 

3,375,000

  

Florida Power & Light Co.

  

05/15/33

  

4.800

 

  

 

3,213,629

 

2,095,000

  

Narragansett Electric Co.1

  

04/09/30

  

3.395

 

  

 

1,871,236

 

2,120,000

  

Nevada Power Co.

 

05/01/53

  

5.900

 

  

 

2,078,473

 

3,500,000

  

Oncor Electric Delivery Co. LLC

  

05/15/28

  

4.300

 

  

 

3,370,632

 

3,455,000

  

Vistra Operations Co. LLC1

  

10/15/33

  

6.950

 

  

 

3,600,148

 

              

 

  

 

28,808,521

 

    

ENERGY-ALTERNATE SOURCES (0.4%)

        

 

  

 

  

 

4,500,000

  

NextEra Energy Partners LP1

  

06/15/26

  

2.500

 

  

 

4,043,093

 

              

 

  

 

  

 

    

FOOD (0.8%)

        

 

  

 

  

 

4,765,000

  

Nestle Capital Corp.1

  

03/12/31

  

4.750

 

  

 

4,625,453

 

2,985,000

  

Tyson Foods, Inc.

  

03/15/34

  

5.700

 

  

 

2,928,183

 

              

 

  

 

7,553,636

 

    

HEALTHCARE-SERVICES (0.7%)

        

 

  

 

  

 

3,260,000

  

Providence St Joseph Health Obligated Group

  

10/01/33

  

5.403

 

  

 

3,199,204

 

4,210,000

  

Roche Holdings, Inc.1

  

03/08/31

  

4.909

 

  

 

4,115,917

 

              

 

  

 

7,315,121

 

    

INSURANCE (9.4%)

        

 

  

 

  

 

4,175,000

  

Aegon, Ltd. (6-Month USD-LIBOR + 3.540%)3

  

04/11/48

  

5.500

 

  

 

4,008,212

 

2,940,000

  

American Coastal Insurance Corp.

  

12/15/27

  

7.250

 

  

 

2,697,450

 

2,880,000

  

Ascot Group, Ltd.1

  

12/15/30

  

4.250

 

  

 

2,336,793

 

2,035,000

  

Athene Global Funding1

  

06/29/25

  

2.550

 

  

 

1,953,503

 

2,790,000

  

Athene Holding, Ltd.

  

02/01/33

  

6.650

 

  

 

2,882,857

 

5,715,000

  

AXIS Specialty Finance LLC (5-Year CMT Index + 3.186%)3

  

01/15/40

  

4.900

 

  

 

5,121,988

 

2,920,000

  

Corebridge Financial, Inc. (5-Year CMT Index + 3.846%)3

  

12/15/52

  

6.875

 

  

 

2,890,658

 

3,175,000

  

Corebridge Global Funding1

  

09/19/28

  

5.900

 

  

 

3,192,323

 

4,210,000

  

Doctors Co. An Interinsurance Exchange1

  

01/18/32

  

4.500

 

  

 

3,237,448

 

1,600,000

  

Enstar Finance LLC (5-Year CMT Index + 5.468%)3

  

09/01/40

  

5.750

 

  

 

1,556,127

 

4,100,000

  

Enstar Finance LLC (5-Year CMT Index + 4.006%)3

  

01/15/42

  

5.500

 

  

 

3,867,387

 

5,540,000

  

F&G Annuities & Life, Inc.

 

01/13/28

  

7.400

 

  

 

5,693,521

The accompanying notes are an integral part of these financial statements.

8

    

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

CORPORATE BONDS (continued)

        

 

  

 

  

 

    

INSURANCE (continued)

        

 

  

 

  

$

4,765,000

  

Fidelis Insurance Holdings, Ltd. (5-Year CMT Index + 6.323%)1,3

  

04/01/41

  

6.625

%

  

$

4,717,350

 

3,128,000

  

First American Financial Corp.

  

08/15/31

  

2.400

 

  

 

2,417,686

 

3,485,000

  

Global Atlantic Finance Co.1

  

06/15/33

  

7.950

 

  

 

3,771,338

 

1,690,000

  

Metropolitan Life Global Funding I1

  

03/21/29

  

3.300

 

  

 

1,534,256

 

2,280,000

  

Metropolitan Life Global Funding I1

  

03/28/33

  

5.150

 

  

 

2,208,488

 

1,580,000

  

Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (5-Year CMT Index + 3.982%)1,3

  

05/23/42

  

5.875

 

  

 

1,566,175

 

5,090,000

  

Northwestern Mutual Global Funding1

  

03/25/27

  

5.070

 

  

 

5,053,756

 

3,708,000

  

PartnerRe Finance B LLC (5-Year CMT Index + 3.815%)3

  

10/01/50

  

4.500

 

  

 

3,354,764

 

4,365,000

  

Protective Life Global Funding1

  

01/12/27

  

4.992

 

  

 

4,308,807

 

5,720,000

  

RenaissanceRe Holdings, Ltd.

 

06/05/33

  

5.750

 

  

 

5,575,654

 

3,460,000

  

RGA Global Funding1

  

01/11/31

  

5.500

 

  

 

3,403,959

 

3,735,000

  

SiriusPoint, Ltd.

  

04/05/29

  

7.000

 

  

 

3,725,846

 

3,125,000

  

Stewart Information Services Corp.

  

11/15/31

  

3.600

 

  

 

2,544,477

 

4,830,000

  

Swiss Re Finance Luxembourg S.A. (5-Year CMT Index + 3.582%)1,3

  

04/02/49

  

5.000

 

  

 

4,624,725

 

6,280,000

  

Universal Insurance Holdings, Inc.

  

11/30/26

  

5.625

 

  

 

5,868,440

 

              

 

  

 

94,113,988

 

    

INVESTMENT COMPANIES (4.4%)

        

 

  

 

  

 

317,000

  

Blue Owl Capital Corp. II1

  

11/26/24

  

4.625

 

  

 

314,005

 

2,560,000

  

Blue Owl Technology Finance Corp.1

  

06/30/25

  

6.750

 

  

 

2,534,929

 

2,490,000

  

Capital Southwest Corp.

  

01/31/26

  

4.500

 

  

 

2,363,633

 

1,635,000

  

CION Investment Corp.

  

02/11/26

  

4.500

 

  

 

1,554,861

 

5,725,000

  

Fairfax India Holdings Corp.1

  

02/26/28

  

5.000

 

  

 

5,173,768

 

2,930,000

  

Franklin BSP Lending Corp.1

  

12/15/24

  

4.850

 

  

 

2,893,727

 

1,370,000

  

FS KKR Capital Corp.

  

02/01/25

  

4.125

 

  

 

1,346,654

 

3,450,000

  

FS KKR Capital Corp.1

  

02/14/25

  

4.250

 

  

 

3,397,456

 

2,330,000

  

Gladstone Capital Corp.

  

01/31/26

  

5.125

 

  

 

2,248,450

 

1,965,000

  

Main Street Capital Corp.

  

05/01/24

  

5.200

 

  

 

1,965,000

 

2,960,000

  

MidCap Financial Investment Corp.

  

07/16/26

  

4.500

 

  

 

2,748,424

 

3,185,000

  

Morgan Stanley Direct Lending Fund

  

02/11/27

  

4.500

 

  

 

3,064,961

 

2,095,000

  

OFS Capital Corp.

  

02/10/26

  

4.750

 

  

 

1,909,247

 

2,535,000

  

PennantPark Floating Rate Capital, Ltd.

  

04/01/26

  

4.250

 

  

 

2,369,904

 

3,025,000

  

Saratoga Investment Corp.

  

02/28/26

  

4.375

 

  

 

2,887,737

 

3,050,000

  

Silver Point Specialty Credit Fund, L.P1,2

  

11/04/26

  

4.000

 

  

 

2,701,995

 

1,775,000

  

Stellus Capital Investment Corp.

  

03/30/26

  

4.875

 

  

 

1,637,452

 

3,165,000

  

Trinity Capital, Inc.

  

12/15/26

  

4.250

 

  

 

2,849,467

 

              

 

  

 

43,961,670

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

9

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

CORPORATE BONDS (continued)

        

 

  

 

  

 

    

MACHINERY-DIVERSIFIED (0.9%)

        

 

  

 

  

$

2,275,000

  

CNH Industrial Capital LLC

  

04/10/28

  

4.550

%

  

$

2,189,942

 

2,450,000

  

CNH Industrial Capital LLC

  

01/12/29

  

5.500

 

  

 

2,441,603

 

4,710,000

  

John Deere Capital Corp.

  

03/07/31

  

4.900

 

  

 

4,602,012

 

              

 

  

 

9,233,557

 

    

MEDIA (0.5%)

        

 

  

 

  

 

5,110,000

  

CCO Holdings LLC / CCO Holdings Capital Corp.1

  

03/01/31

  

7.375

 

  

 

4,849,060

 

              

 

  

 

  

 

    

MINING (0.3%)

        

 

  

 

  

 

2,485,000

  

Glencore Funding LLC1

  

10/06/28

  

6.125

 

  

 

2,516,397

 

              

 

  

 

  

 

    

OIL & GAS (0.5%)

        

 

  

 

  

 

4,480,000

  

Sunoco LP1

  

05/01/29

  

7.000

 

  

 

4,549,827

 

              

 

  

 

  

 

    

PACKAGING & CONTAINERS (0.1%)

        

 

  

 

  

 

1,465,000

  

AptarGroup, Inc.

  

03/15/32

  

3.600

 

  

 

1,255,304

 

              

 

  

 

  

 

    

PHARMACEUTICALS (0.7%)

        

 

  

 

  

 

730,000

  

Bausch Health Cos., Inc.1

  

06/01/28

  

4.875

 

  

 

471,565

 

3,885,000

  

Bristol-Myers Squibb Co.

  

02/01/31

  

5.750

 

  

 

3,971,513

 

2,945,000

  

Pfizer Investment Enterprises Pte, Ltd.

  

05/19/30

  

4.650

 

  

 

2,847,883

 

              

 

  

 

7,290,961

 

    

PIPELINES (0.8%)

        

 

  

 

  

 

4,045,000

  

Energy Transfer LP (3-Month CME Term SOFR + 4.290%)3,6

      

9.597

 

  

 

4,045,377

 

2,430,000

  

Harvest Midstream I LP1

  

09/01/28

  

7.500

 

  

 

2,436,658

 

1,150,000

  

Northriver Midstream Finance LP1

  

02/15/26

  

5.625

 

  

 

1,125,735

 

              

 

  

 

7,607,770

 

    

PRIVATE EQUITY (0.6%)

        

 

  

 

  

 

2,095,000

  

Apollo Management Holdings LP (5-Year CMT Index + 3.266%)1,3

  

01/14/50

  

4.950

 

  

 

2,002,621

 

2,065,000

  

HAT Holdings I LLC / HAT Holdings II LLC1

  

06/15/26

  

3.375

 

  

 

1,919,249

 

2,300,000

  

HAT Holdings I LLC / HAT Holdings II LLC1

  

09/15/30

  

3.750

 

  

 

1,908,302

 

              

 

  

 

5,830,172

 

    

REAL ESTATE INVESTMENT TRUSTS (2.9%)

        

 

  

 

  

 

3,340,000

  

American Tower Trust #11

  

03/15/28

  

5.490

 

  

 

3,325,065

 

4,140,000

  

Arbor Realty SR, Inc.1

  

10/15/27

  

8.500

 

  

 

3,975,205

 

3,765,000

  

Blackstone Mortgage Trust, Inc.1

  

01/15/27

  

3.750

 

  

 

3,372,980

 

5,075,000

  

EF Holdco / EF Cayman Hold / Ellington Finance REIT Cayman / TRS / EF Cayman Non-MTM1

  

04/01/27

  

5.875

 

  

 

4,770,790

 

2,955,000

  

Federal Realty OP LP

  

05/01/28

  

5.375

 

  

 

2,921,379

 

2,750,000

  

Rexford Industrial Realty LP

  

06/15/28

  

5.000

 

  

 

2,683,438

The accompanying notes are an integral part of these financial statements.

10

    

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

CORPORATE BONDS (continued)

        

 

  

 

  

 

    

REAL ESTATE INVESTMENT TRUSTS (continued)

    

 

  

 

  

$

2,000,000

  

SBA Tower Trust1

  

01/15/28

  

6.599

%

  

$

2,030,054

 

1,380,000

  

Scentre Group Trust 1 / Scentre Group Trust 21

  

02/12/25

  

3.500

 

  

 

1,354,073

 

1,945,000

  

Scentre Group Trust 1 / Scentre Group Trust 21

  

01/28/26

  

3.625

 

  

 

1,876,111

 

1,345,000

  

Scentre Group Trust 2 (5-Year CMT Index + 4.685%)1,3

  

09/24/80

  

5.125

 

  

 

1,226,471

 

2,065,000

  

Starwood Property Trust, Inc.1

  

01/15/27

  

4.375

 

  

 

1,912,403

 

              

 

  

 

29,447,969

 

    

RETAIL (0.6%)

        

 

  

 

  

 

3,238,000

  

Macy’s Retail Holdings LLC1

  

03/15/30

  

5.875

 

  

 

3,086,433

 

3,450,000

  

Nordstrom, Inc.

  

04/01/30

  

4.375

 

  

 

3,079,155

 

              

 

  

 

6,165,588

 

    

SEMICONDUCTORS (0.6%)

        

 

  

 

  

 

5,575,000

  

ams-OSRAM AG1

  

03/30/29

  

12.250

 

  

 

5,578,512

 

              

 

  

 

  

 

    

TELECOMMUNICATIONS (0.1%)

        

 

  

 

  

 

875,000

  

Connect Finco S.a r.l. / Connect US Finco LLC1

  

10/01/26

  

6.750

 

  

 

847,427

 

    

Total Corporate Bonds
(Cost $432,892,281)

 

  

 

419,213,644

 

              

 

  

 

  

 

    

LOAN PARTICIPATIONS AND ASSIGNMENTS (11.7%)

        

 

  

 

  

 

4,088,000

  

AAdvantage Loyality IP, Ltd. (3-Month CME Term SOFR + 4.750%)3

  

04/20/28

  

10.336

 

  

 

4,247,677

 

3,274,642

  

AHP Health Partners, Inc. (1-Month CME Term SOFR + 3.500%)3

  

08/24/28

  

8.930

 

  

 

3,280,111

 

2,196,675

  

AL NGPL Holdings LLC (3-Month CME Term SOFR + 3.250%)3

  

04/13/28

  

8.556

 

  

 

2,201,069

 

2,980,311

  

Allen Media LLC (3-Month CME Term SOFR + 5.500%)3

  

02/10/27

  

10.959

 

  

 

2,653,728

 

2,273,363

  

Allspring Buyer LLC (3-Month CME Term SOFR + 3.250%)3

  

11/01/28

  

8.824

 

  

 

2,265,133

 

940,675

  

Allspring Buyer LLC (3-Month CME Term SOFR + 4.000%)3

  

11/01/28

  

9.313

 

  

 

940,346

 

2,050,000

  

American Airlines, Inc. (6-Month CME Term SOFR + 3.500%)3

  

06/04/29

  

8.775

 

  

 

2,055,986

 

2,399,926

  

Athenahealth Group, Inc. (1-Month CME Term SOFR + 3.250%)3

  

02/15/29

  

8.566

 

  

 

2,393,926

 

1,174,849

  

Avolon TLB Borrower 1 (US) LLC Term B6 (1-Month CME Term SOFR + 2.000%)3

  

06/22/28

  

7.315

 

  

 

1,176,929

 

1,779,206

  

Axalta Coating Systems Dutch Holding B BV Term B6 (3-Month CME Term SOFR + 2.000%)3

  

12/20/29

  

7.330

 

  

 

1,783,654

 

2,171,750

  

Bausch Health Companies, Inc. (1-Month CME Term SOFR + 5.250%)3

  

02/01/27

  

10.668

 

  

 

1,817,755

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

11

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

LOAN PARTICIPATIONS AND
ASSIGNMENTS (continued)

    

 

  

 

  

$

2,752,672

  

BCP Renaissance Parent LLC Term B4 (3-Month CME Term SOFR + 3.500%)3

  

10/31/28

  

8.829

%

  

$

2,762,306

 

890,589

  

Buckeye Partners LP Term B3 (1-Month CME Term SOFR + 2.000%)3

  

11/01/26

  

7.316

 

  

 

892,958

 

3,602,775

  

Central Parent LLC (3-Month CME Term SOFR + 4.000%)3

  

07/06/29

  

9.309

 

  

 

3,615,565

 

11,453,401

  

Connect Finco S.a.r.l. (1-Month CME Term SOFR + 4.500%)3

  

09/27/29

  

9.816

 

  

 

11,095,482

 

2,707,408

  

Delos Aircraft Designated Activity Co. (3-Month CME Term SOFR + 2.000%)3

  

10/31/27

  

7.302

 

  

 

2,708,761

 

1,445,000

  

Delos Aircraft Designated Activity Co. Term B (3-Month CME Term SOFR + 1.750%)3

  

10/13/27

  

7.416

 

  

 

1,445,722

 

2,260,442

  

Eastern Power LLC (1-Month CME Term SOFR + 3.750%)3

  

10/02/25

  

9.180

 

  

 

2,255,084

 

2,293,243

  

Elanco Animal Health, Inc. (1-Month CME Term SOFR + 1.750%)3

  

08/01/27

  

7.177

 

  

 

2,287,900

 

1,886,625

  

Geon Performance Solutions LLC (Fka. Echo US Holdings LLC) (3-Month CME Term SOFR + 4.750%)3

  

08/18/28

  

10.314

 

  

 

1,890,549

 

881,326

  

GIP II Blue Holding, LP (1-Month CME Term SOFR + 3.750%)3

  

09/29/28

  

9.066

 

  

 

885,592

 

1,539,354

  

Global Medical Response, Inc. (1-Month CME Term SOFR + 4.250%)3

  

03/14/25

  

9.680

 

  

 

1,456,937

 

3,261,269

  

ILPEA Parent, Inc. (1-Month CME Term SOFR + 4.500%)3

  

06/22/28

  

9.930

 

  

 

3,244,962

 

3,880,275

  

INEOS Enterprises Holdings US Finco LLC Term B (3-Month CME Term SOFR + 3.750%)3

  

07/08/30

  

9.193

 

  

 

3,881,478

 

3,695,738

  

Iqvia, Inc. Term B4 (3-Month CME Term SOFR + 2.000%)3

  

01/02/31

  

7.309

 

  

 

3,710,225

 

4,182,183

  

Iridium Satellite LLC Term B3 (1-Month CME Term SOFR + 2.500%)3

  

09/20/30

  

7.816

 

  

 

4,183,479

 

2,513,333

  

Jazz Pharmaceuticals Plc. Term B1 (1-Month CME Term SOFR + 3.000%)3

  

05/05/28

  

8.430

 

  

 

2,527,483

 

4,575,303

  

LendingTree, Inc. Term B (1-Month CME Term SOFR + 3.750%)3

  

09/15/28

  

9.180

 

  

 

4,433,469

 

876,023

  

Lumen Technologies, Inc. Term A (1-Month CME Term SOFR + 6.000%)3

  

06/01/28

  

11.316

 

  

 

740,240

 

3,625,913

  

Medallion Midland Acquisition, LP (3-Month CME Term SOFR + 3.500%)3

  

10/18/28

  

8.830

 

  

 

3,638,386

 

2,722,623

  

Medline Borrower, LP (1-Month CME Term SOFR + 2.750%)3

  

10/23/28

  

8.068

 

  

 

2,728,640

 

3,000,925

  

MIP V Waste LLC (3-Month CME Term SOFR + 3.250%)3

  

12/08/28

  

8.841

 

  

 

3,005,937

The accompanying notes are an integral part of these financial statements.

12

    

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

LOAN PARTICIPATIONS AND
ASSIGNMENTS (continued)

    

 

  

 

  

$

6,429,327

  

MPH Acquisition Holdings LLC (3-Month CME Term SOFR + 4.250%)3

  

09/01/28

  

9.855

%

  

$

5,936,648

 

6,352,545

  

OCM System One Buyer CTB LLC (3-Month CME Term SOFR + 4.000%)3

  

03/02/28

  

9.459

 

  

 

6,368,426

 

2,360,288

  

Organon & Co. (1-Month CME Term SOFR + 3.000%)3

  

06/02/28

  

8.433

 

  

 

2,369,870

 

3,355,705

  

Propulsion (BC) Newco LLC (3-Month CME Term SOFR + 3.750%)3

  

09/14/29

  

9.058

 

  

 

3,368,993

 

905,771

  

SkyMiles IP, Ltd. (3-Month CME Term SOFR + 3.750%)3

  

10/20/27

  

9.075

 

  

 

933,035

 

1,787,375

  

Starwood Property Mortgage LLC (1-Month CME Term SOFR + 3.250%)3

  

11/18/27

  

8.566

 

  

 

1,785,891

 

5,270,000

  

United AirLines, Inc. Term B (3-Month CME Term SOFR + 2.750%)3

  

02/22/31

  

8.076

 

  

 

5,284,809

 

1,114,348

  

Verscend Holding Corp. Team B1 (3-Month U.S. Prime Rate + 3.000%)3

  

08/27/25

  

11.500

 

  

 

1,114,626

 

1,774,339

  

Vistra Operations Company LLC (fka Tex Operations Co. LLC) (1-Month CME Term SOFR + 2.000%)3

  

12/20/30

  

7.316

 

  

 

1,775,137

 

    

Total Loan Participations and Assignments
(Cost $118,233,481)

 

  

 

117,144,904

 

              

 

  

 

  

 

    

MUNICIPAL BONDS (0.1%)

        

 

  

 

  

 

1,645,000

  

Indiana Finance Authority, Revenue Bonds

  

03/01/51

  

3.313

 

  

 

1,086,280

 

    

Total Municipal Bonds
(Cost $1,645,000)

 

  

 

1,086,280

 

              

 

  

 

  

 

    

PREFERRED SECURITIES (2.6%)

        

 

  

 

  

 

79,000

  

Apollo Global Management, Inc. (5-Year CMT Index + 3.226%)3

  

09/15/53

  

7.625

 

  

 

2,087,180

 

99,600

  

Crescent Capital BDC, Inc.

  

05/25/26

  

5.000

 

  

 

2,404,344

 

178,600

  

Eagle Point Credit Co., Inc.

  

01/31/29

  

5.375

 

  

 

4,009,570

 

66,200

  

Ellington Financial, Inc. (5-Year CMT Index + 5.130%)3,6

      

8.625

 

  

 

1,543,784

 

132,600

  

Gladstone Investment Corp.

  

11/01/28

  

4.875

 

  

 

3,010,020

 

93,600

  

Horizon Technology Finance Corp.

  

03/30/26

  

4.875

 

  

 

2,232,706

 

130,800

  

Oxford Lane Capital Corp.

  

01/31/27

  

5.000

 

  

 

3,010,035

 

114,000

  

Trinity Capital, Inc.

  

01/16/25

  

7.000

 

  

 

2,883,060

 

175,000

  

Trinity Capital, Inc.

  

03/30/29

  

7.875

 

  

 

4,471,215

 

    

Total Preferred Securities
(Cost $26,775,836)

 

  

 

25,651,914

 

              

 

  

 

  

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

13

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date 

  

Interest
Rate

 

Value

 

    

RESIDENTIAL MORTGAGE BACKED SECURITIES (0.1%)

        

 

  

 

  

 

$

359,709

  

Cascade Funding Mortgage Trust 2018-RM21,3,4

  

10/25/68

  

4.000

%

  

$

352,897

 

 

186,420

  

Cascade Funding Mortgage Trust 2019-RM31,3,4

  

06/25/69

  

2.800

 

  

 

182,804

 

 

303,988

  

RMF Proprietary Issuance Trust 2019-11,3,4

  

10/25/63

  

2.750

 

  

 

257,436

 

 

    

Total Residential Mortgage Backed Securities
(Cost $846,480)

 

  

 

793,137

 

 

              

 

  

 

  

 

 

    

U.S. GOVERNMENT AGENCY
OBLIGATIONS (1.5%)

        

 

  

 

  

 

 

15,200,000

  

Federal Home Loan Bank Discount Notes5

  

05/01/24

  

0.000

 

  

 

15,200,000

 

 

    

Total U.S. Government Agency Obligations
(Cost $15,200,000)

 

  

 

15,200,000

 

 

              

 

  

 

  

 

 

    

U.S. TREASURY BILLS (0.4%)

        

 

  

 

  

 

 

2,100,000

  

U.S. Treasury Bill5,7

  

07/25/24

  

0.000

 

  

 

2,073,981

 

 

2,300,000

  

U.S. Treasury Bill5,7

  

10/10/24

  

0.000

 

  

 

2,246,401

 

 

    

Total U.S. Treasury Bills
(Cost $4,321,970)

 

  

 

4,320,382

 

 

              

 

  

 

  

 

 

    

U.S. TREASURY BONDS AND NOTES (15.9%)

        

 

  

 

  

 

 

26,120,000

  

U.S. Treasury Bond

  

02/15/39

  

3.500

 

  

 

22,756,030

 

 

3,900,000

  

U.S. Treasury Bond

  

08/15/41

  

1.750

 

  

 

2,476,347

 

 

31,500,000

  

U.S. Treasury Bond

  

02/15/43

  

3.875

 

  

 

27,516,973

 

 

34,365,000

  

U.S. Treasury Bond

  

08/15/50

  

1.375

 

  

 

16,767,704

 

 

37,725,000

  

U.S. Treasury Bond

  

02/15/53

  

3.625

 

  

 

30,822,504

 

 

13,600,000

  

U.S. Treasury Bond

  

05/15/53

  

3.625

 

  

 

11,115,875

 

 

12,750,000

  

U.S. Treasury Note

  

03/31/29

  

4.125

 

  

 

12,417,305

 

 

3,000,000

  

U.S. Treasury Note7

  

05/15/33

  

3.375

 

  

 

2,711,250

 

 

33,915,000

  

U.S. Treasury Note

  

02/15/34

  

4.000

 

  

 

32,113,265

 

 

    

Total U.S. Treasury Bonds and Notes
(Cost $169,630,932)

 

  

 

158,697,253

 

 

              

 

  

 

  

 

 

TOTAL INVESTMENTS (Cost $1,040,972,710)8

  

100.9

%

  

$

1,008,089,355

 

 

LIABILITIES IN EXCESS OF CASH AND OTHER ASSETS

  

(0.9

)%

  

 

(9,245,402

)

 

NET ASSETS

  

100.0

%

  

$

998,843,953

 

____________

​1    Security exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. Total market value of Rule 144A securities owned at April 30, 2024 was $456,708,487 or 45.7% of net assets.

​2    Security that used significant unobservable inputs to determine fair value.

​3    Variable rate instrument. Interest rates change on specific dates (such as coupon or interest payment date). The yield shown represents the April 30, 2024 coupon or interest rate.

The accompanying notes are an integral part of these financial statements.

14

    

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

​4       This variable rate security is based on a predetermined schedule and the rate at period end also represents the reference rate at period end.

​5       Security issued with zero coupon. Income is recognized through accretion of discount.

​6       Security is perpetual in nature and has no stated maturity date.

​7       All or a portion of this security is held at the broker as collateral for open futures contracts.

​8   The aggregate cost of investments and derivatives for federal income tax purposes is $1,040,972,710, the aggregate gross unrealized appreciation is $6,744,262 and the aggregate gross unrealized depreciation is $46,334,165, resulting in net unrealized depreciation of $39,589,903.

    

Abbreviations:

CME − Chicago Mercantile Exchange.

CMT − Constant Maturity Treasury.

LIBOR − London Interbank Offered Rate.

SOFR − Secured Overnight Financing Rate.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

15

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

FINANCIAL FUTURES CONTRACTS

The following futures contracts were open at April 30, 2024:

Description

  

Number of
Contracts

  

Expiration
Date

  

Notional
Amount

  

Market
Value

  

Unrealized
Gain / (Loss)

Contracts to Buy:

          

 

    

 

    

 

  

 

U.S. Treasury 10-Year Notes

  

770

  

June 2024

  

$

84,784,031

  

$

82,726,875

  

$

(2,057,156

)

U.S. Treasury 10-Year Ultra Bond

  

935

  

June 2024

  

 

105,750,842

  

 

103,054,531

  

 

(2,696,311

)

U.S. Long Bond

  

340

  

June 2024

  

 

40,146,050

  

 

38,696,250

  

 

(1,449,800

)

U.S. Ultra Bond

  

220

  

June 2024

  

 

27,697,656

  

 

26,303,750

  

 

(1,393,906

)
           

 

    

 

    

$

(7,597,173)

 

Contracts to Sell:

          

 

    

 

    

 

  

 

U.S. Treasury 5-Year Notes

  

456

  

June 2024

  

$

48,653,063

  

$

47,762,438

  

$

890,625

 

Net Unrealized (Loss) on Open Futures Contracts

          

 

    

 

    

$

(6,706,548)

 

Fair Value Measurements

The Fund is required to disclose information regarding the fair value measurements of the Fund’s assets and liabilities. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The disclosure requirement established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including, for example, the risk inherent in a particular valuation technique used to measure fair value, including the model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the Fund’s own considerations about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

Authoritative guidance establishes three levels of the fair value hierarchy as follows:

— Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities.

— Level 2 – significant other observable inputs (including quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.).

— Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities).

The accompanying notes are an integral part of these financial statements.

16

    

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. Inputs may include price information, specific and broad credit data, liquidity statistics, and other factors. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires judgment by the investment adviser. The investment adviser considers observable data to be that market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The categorization of a financial instrument within the hierarchy is based upon the pricing transparency of the instrument and does not necessarily correspond to the investment adviser’s perceived risk of that instrument.

Financial assets within Level 1 are based on quoted market prices in active markets. The Fund does not adjust the quoted price for these instruments.

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. These include investment-grade corporate bonds, U.S. Treasury notes and bonds, and certain non-U.S. sovereign obligations and over-the-counter derivatives. As Level 2 financial assets include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

Financial assets classified within Level 3 have significant unobservable inputs, as they trade infrequently. Level 3 financial assets include private equity and certain corporate debt securities.

Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon the actual sale of those investments.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

17

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

The following table summarizes the valuation of the Fund’s investments by the above fair value hierarchy levels as of April 30, 2024.

Investments, at value

  

Unadjusted
Quoted Prices in
Active Markets
for Identical
Investments
(Level 1)

  

Significant
Other
Observable
Inputs
(Level 2)

  

Significant
Unobservable
Inputs
(Level 3)

  

Balance as of
April 30, 2024

Asset Backed Securities

  

$

—

 

  

$

195,048,598

  

$

5,908,306

  

$

200,956,904

 

Commercial Mortgage Backed Securities

  

 

—

 

  

 

56,947,396

  

 

8,077,541

  

 

65,024,937

 

Corporate Bonds

  

 

—

 

  

 

410,641,780

  

 

8,571,864

  

 

419,213,644

 

Loan Participations and Assignments

 

 

—

 

  

 

117,144,904

  

 

—

  

 

117,144,904

 

Municipal Bonds

  

 

—

 

  

 

1,086,280

  

 

—

  

 

1,086,280

 

Preferred Securities

  

 

25,651,914

 

  

 

—

  

 

—

  

 

25,651,914

 

Residential Mortgage Backed Securities

  

 

—

 

  

 

793,137

  

 

—

  

 

793,137

 

U.S. Government Agency Obligations

 

 

—

 

  

 

15,200,000

  

 

—

  

 

15,200,000

 

U.S. Treasury Bills

  

 

—

 

  

 

4,320,382

  

 

—

  

 

4,320,382

 

U.S. Treasury Bonds and Notes

  

 

—

 

  

 

158,697,253

  

 

—

  

 

158,697,253

 

Total Investments, at value

  

$

25,651,914

 

  

$

959,879,730

  

$

22,557,711

  

$

1,008,089,355

 

Other Financial Instruments, at value

  

 

  

 

  

 

    

 

    

 

  

 

Financial Futures Contracts

 

$

(6,706,548

)

  

$

—

  

$

—

  

$

(6,706,548

)

Other Financial Instruments, at value

  

$

(6,706,548

)

  

$

—

  

$

—

  

$

(6,706,548

)

The accompanying notes are an integral part of these financial statements.

18

    

 

BBH INCOME FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

The following is a reconciliation of assets for which significant unobservable inputs (Level 3) were used in determining fair value during the period ended April 30, 2024:

 

Asset Backed Securities

  

Commercial Mortgage Backed Securities

  

Corporate Bonds

  

Total

Balance as of October 31, 2023

  

$

6,126,472

 

  

$

1,583,531

 

  

$

8,507,034

  

$

16,217,037

 

Purchases

  

 

—

 

  

 

7,346,812

 

  

 

—

  

 

7,346,812

 

Sales/Paydowns

  

 

(426,868

)

  

 

(899,761

)

  

 

—

  

 

(1,326,629

)

Realized gains/(losses)

  

 

—

 

  

 

124

 

  

 

—

  

 

124

 

Change in unrealized appreciation/(depreciation)

  

 

208,702

 

  

 

(359,490

)

  

 

64,830

  

 

(85,958

)

Amortization

  

 

—

 

  

 

406,325

 

  

 

—

  

 

406,325

 

Transfers from Level 3

  

 

—

 

  

 

—

 

  

 

—

  

 

—

 

Transfers to Level 3

  

 

—

 

  

 

—

 

  

 

—

  

 

—

 

Balance as of April 30, 2024

  

$

5,908,306

 

  

$

8,077,541

 

  

$

8,571,864

  

$

22,557,711

 

Fund investments classified as Level 3 were either single broker quoted or fair valued using a market approach or an income approach with valuation inputs such as a discounted cash flow model or market price information adjusted for changes in an appropriate index. As of April 30, 2024, $7,822,967 of value of the Level 3 assets in the Fund was based on a single quote from a broker.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

19

 

BBH INCOME FUND

STATEMENT OF ASSETS AND LIABILITIES

April 30, 2024 (unaudited)

ASSETS:

  

 

  

 

Investments in securities, at value (Cost $1,040,972,710)

  

$

1,008,089,355

 

Cash

  

 

480,614

 

Foreign currency at value (Cost $226)

  

 

246

 

Receivables for:

  

 

  

 

Interest

  

 

8,302,213

 

Investments sold

  

 

6,120,298

 

Shares sold

  

 

731,403

 

Interest from Custodian

  

 

2,128

 

Prepaid expenses

  

 

5,728

 

Total Assets

  

 

1,023,731,985

 
   

 

  

 

LIABILITIES:

  

 

  

 

Payables for:

  

 

  

 

Investments purchased

  

 

22,907,050

 

Futures variation margin on open contracts

  

 

1,313,591

 

Investment advisory and administrative fees

  

 

326,097

 

Dividends declared

  

 

140,985

 

Custody and fund accounting fees

  

 

67,194

 

Professional fees

  

 

55,525

 

Shares redeemed

  

 

52,833

 

Transfer agent fees

  

 

6,615

 

Board of Trustees’ fees

  

 

582

 

Accrued expenses and other liabilities

  

 

17,560

 

Total Liabilities

  

 

24,888,032

 

NET ASSETS

  

$

998,843,953

 
   

 

  

 

Net Assets Consist of:

  

 

  

 

Paid-in capital

  

$

1,105,522,788

 

Accumulated deficit

  

 

(106,678,835

)

Net Assets

  

$

998,843,953

 
   

 

  

 

NET ASSET VALUE AND OFFERING PRICE PER SHARE

  

 

  

 

CLASS I SHARES

  

 

  

 

($998,843,953 ÷ 115,552,739 shares outstanding)

  

$

8.64

 

The accompanying notes are an integral part of these financial statements.

20

    

 

BBH INCOME FUND

STATEMENT OF OPERATIONS

For the six months ended April 30, 2024 (unaudited)

NET INVESTMENT INCOME:

  

 

  

 

Income:

  

 

  

 

Dividends

  

$

       71,372

 

Interest income

  

 

27,272,393

 

Interest income from Custodian

  

 

16,711

 

Other income

  

 

315,879

 

Total Income

  

 

27,676,355

 
   

 

  

 

Expenses:

  

 

  

 

Investment advisory and administrative fees

  

 

1,799,917

 

Custody and fund accounting fees

  

 

65,370

 

Professional fees

  

 

51,553

 

Board of Trustees’ fees

  

 

42,711

 

Transfer agent fees

  

 

20,167

 

Miscellaneous expenses

  

 

34,323

 

Total Expenses

  

 

2,014,041

 

Net Investment Income

  

 

25,662,314

 
   

 

  

 

NET REALIZED AND UNREALIZED GAIN:

  

 

  

 

Net realized loss on investments in securities

  

 

(4,303,872

)

Net realized loss on futures contracts

  

 

(2,264,218

)

Net realized loss on investments in securities and futures contracts

  

 

(6,568,090

)
   

 

  

 

Net change in unrealized appreciation/(depreciation) on investments in securities

  

 

29,726,130

 

Net change in unrealized appreciation/(depreciation) on futures contracts

  

 

5,643,900

 

Net change in unrealized appreciation/(depreciation) on foreign currency translations

  

 

2

 

Net change in unrealized appreciation/(depreciation) on investments in securities, futures contracts and foreign currency translations

  

 

35,370,032

 

Net Realized and Unrealized Gain

  

 

28,801,942

 

Net Increase in Net Assets Resulting from Operations

  

$

54,464,256

 

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

21

 

BBH INCOME FUND

STATEMENTS OF CHANGES IN NET ASSETS

   
 

For the
six months ended
April 30, 2024
(unaudited)

  

For the
year ended
October 31, 2023

INCREASE/(DECREASE) IN NET ASSETS FROM:

  

 

  

 

  

 

  

 

Operations:

  

 

  

 

  

 

  

 

Net investment income

  

$

  25,662,314

 

  

$

  37,598,057

 

Net realized loss on investments in securities and futures contracts

  

 

(6,568,090

)

  

 

(25,305,935

)

Net change in unrealized appreciation/(depreciation) on investments in securities, futures contracts and foreign currency translations

  

 

35,370,032

 

  

 

(307,171

)

Net increase in net assets resulting from operations

  

 

54,464,256

 

  

 

11,984,951

 
   

 

  

 

  

 

  

 

Dividends and distributions declared:

  

 

  

 

  

 

  

 

Class I

  

 

(25,711,027

)

  

 

(37,555,733

)
   

 

  

 

  

 

  

 

Share transactions:

  

 

  

 

  

 

  

 

Proceeds from sales of shares

  

 

251,482,861

 

  

 

377,670,836

 

Net asset value of shares issued to shareholders for reinvestment of dividends and distributions

  

 

4,083,495

 

  

 

4,877,819

 

Proceeds from short-term redemption fees

  

 

2,793

 

  

 

7,073

 

Cost of shares redeemed

  

 

(58,109,450

)

  

 

(131,621,537

)

Net increase in net assets resulting from share transactions

  

 

197,459,699

 

  

 

250,934,191

 

Total increase in net assets

  

 

226,212,928

 

  

 

225,363,409

 
   

 

  

 

  

 

  

 

NET ASSETS:

  

 

  

 

  

 

  

 

Beginning of period/year

  

 

772,631,025

 

  

 

547,267,616

 

End of period/year

  

$

998,843,953

 

  

$

772,631,025

 

The accompanying notes are an integral part of these financial statements.

22

    

 

BBH INCOME FUND

FINANCIAL HIGHLIGHTS

Selected per share data and ratios for a Class I share outstanding throughout each period/year.
 

For the
six months
ended
April 30,
2024
(unaudited)

  





For the years ended October 31,

2023

  

2022

  

2021

  

2020

  

2019

Net asset value, beginning of period/year

  

$

8.30

 

  

$

8.49

 

  

$

10.49

 

  

$

10.77

 

  

$

10.61

 

  

$

9.83

 

Income from investment operations:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Net investment income1

  

 

0.25

 

  

 

0.47

 

  

 

0.36

 

  

 

0.34

 

  

 

0.34

 

  

 

0.36

 

Net realized and unrealized gain/(loss)

  

 

0.34

 

  

 

(0.20

)

  

 

(2.00

)

  

 

0.15

 

  

 

0.46

 

  

 

0.78

 

Total income/(loss) from investment operations

  

 

0.59

 

  

 

0.27

 

  

 

(1.64

)

  

 

0.49

 

  

 

0.80

 

  

 

1.14

 

Dividends and distributions to shareholders:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

From net investment income

  

 

(0.25

)

  

 

(0.46

)

  

 

(0.36

)

  

 

(0.33

)

  

 

(0.34

)

  

 

(0.36

)

From net realized gains

  

 

—

 

  

 

—

 

  

 

—

 

  

 

(0.44

)

  

 

(0.30

)

  

 

—

 

Total dividends and distributions to shareholders

  

 

(0.25

)

  

 

(0.46

)

  

 

(0.36

)

  

 

(0.77

)

  

 

(0.64

)

  

 

(0.36

)

Short-term redemption fees1

  

 

0.002

 

  

 

0.002

 

  

 

0.002

 

  

 

0.002

 

  

 

0.002

 

  

 

0.002

 

Net asset value, end of period/year

  

$

8.64

 

  

$

8.30

 

  

$

8.49

 

  

$

10.49

 

  

$

10.77

 

  

$

10.61

 

Total return3

  

 

7.07

%4

  

 

3.10

%

  

 

(15.93

)%

  

 

4.64

%

  

 

7.87

%

  

 

11.76

%

Ratios/Supplemental data:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Net assets, end of period/year (in millions)

  

$

999

 

  

$

773

 

  

$

547

 

  

$

612

 

  

$

468

 

  

$

406

 

Ratio of expenses to average net assets before reductions

  

 

0.45

%5

  

 

0.46

%

  

 

0.47

%

  

 

0.47

%

  

 

0.48

%

  

 

0.52

%

Fee waiver6

  

 

—

%

  

 

—

%

  

 

—

%

  

 

—

%

  

 

—

%

  

 

(0.02

)%

Ratio of expenses to average net assets after reductions

  

 

0.45

%5

  

 

0.46

%

  

 

0.47

%

  

 

0.47

%

  

 

0.48

%

  

 

0.50

%

Ratio of net investment income to average net assets

  

 

5.70

%5

  

 

5.36

%

  

 

3.77

%

  

 

3.19

%

  

 

3.24

%

  

 

3.49

%

Portfolio turnover rate

  

 

21

%4

  

 

56

%

  

 

56

%

  

 

69

%

  

 

116

%

  

 

77

%

____________

​1       Calculated using average shares outstanding for the period/year.

​2       Less than $0.01.

​3       Assumes the reinvestment of distributions.

​4       Not annualized.

​5       Annualized.

​6   The ratio of expenses to average net assets for the six months ended April 30, 2024, the years ended October 31, 2023, 2022, 2021, 2020 and 2019 reflects fees reduced as result of a contractual operating expense limitation of the share class to 0.50%. The agreement is effective through March 1, 2025 and may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024 and the years ended October 31, 2023, 2022, 2021, 2020 and 2019, the waived fees were $–, $–, $–, $–, $– and $55,757, respectively.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

23

 

BBH INCOME FUND

NOTES TO FINANCIAL STATEMENTS

April 30, 2024 (unaudited)

1.  Organization. The Fund is a separate, diversified series of BBH Trust (the “Trust”), which is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust was originally organized under the laws of the State of Maryland on July 16, 1990 as BBH Fund, Inc. and re-organized as a Delaware statutory trust on June 12, 2007. As of April 30, 2024, there were eight series of the Trust. The Fund commenced operations on June 27, 2018 and offers two share classes, Class N and Class I. As of April 30, 2024, Class N shares are not available for purchase by investors but may be offered in the future. The investment objective of the Fund is to provide maximum total return, with an emphasis on current income, consistent with preservation of capital and prudent investment management. Neither Class N shares nor Class I shares automatically convert to any other share class of the Fund.

2. Significant Accounting Policies. The Fund’s financial statements are prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”). The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 Financial Services – Investment Companies. The following summarizes significant accounting policies of the Fund:

A. Valuation of Investments. The Board of Trustees (the “Board”) has ultimate responsibility for the supervision and oversight of the determination of the fair value of investments. Pursuant to Rule 2a-5 of the 1940 Act, the Board has designated the Investment Adviser as its valuation designee. The Investment Adviser monitors the continual appropriateness of valuation methods applied and determines if adjustments should be made in light of market factor changes and events affecting issuers. The Investment Adviser performs a series of activities to provide reasonable assurance of the appropriateness of the prices utilized, including but not limited to: periodic independent pricing service due diligence meetings and reviewing the results of back testing on a monthly basis. The Investment Adviser provides the Board with reporting on the results of the back testing as well as positions which were fair valued during the period.

All securities and other investments are recorded at their estimated fair value. The value of investments listed on a securities exchange is based on the last sale price prior to the time when assets are valued, or in the absence of recorded sales, at the most recent bid price on such exchange. If a readily available market quotation is not available or is determined to be unreliable, the investments may be valued utilizing evaluated prices provided by independent pricing services. In establishing such prices, the independent pricing service utilizes both dealer supplied prices and electronic data processing techniques which take into account appropriate factors such as institutional sized trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics, the closure of the primary exchange on which securities trade and before the Fund’s net asset value is next determined and other market data without exclusive reliance on quoted exchange prices or over-the-counter prices since such valuations are believed to reflect more accurately the fair value of such investments. Investments may be fair valued by Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“SID” or “Investment

 

24

    

 

BBH INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

Adviser”) in accordance with the BBH Trust Portfolio Valuation Policy and Procedures using methods that most fairly reflect the amount that the Fund would reasonably expect to receive for the investment on a current sale in its principal market in the ordinary course of business. Short-term investments, which mature in 60 days or less are valued at amortized cost if their original maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if their original maturity when acquired by the Fund was more than 60 days, unless the use of amortized cost is determined not to represent fair value. Any futures contracts held by the Fund are valued daily at the official settlement price of the exchange on which they are traded.

B. Accounting for Investments and Income. Investment transactions are accounted for on the trade date. Realized gains and losses on investment transactions are determined based on the identified cost method. Interest income is accrued daily and consists of interest accrued, discount earned (including, if any, both original issue and market discount) and premium amortization on the investments of the Fund. Investment income is recorded net of any foreign taxes withheld where recovery of such tax is uncertain. Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivable when the collection of all or a portion of the interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.

C. Fund Expenses. Most expenses of the Trust can be directly attributed to a specific fund. Expenses which cannot be directly attributed to a fund are generally apportioned among each fund in the Trust on a net assets basis or other suitable method. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

D. Financial Futures Contracts. The Fund may enter into open futures contracts in order to economically hedge against anticipated future changes in interest rates which otherwise might either adversely affect the value of securities held for the Fund or adversely affect the prices of securities that are intended to be purchased at a later date for the Fund. The contractual amount of the futures contracts represents the investment the Fund has in a particular contract and does not necessarily represent the amounts potentially subject to risk of loss. Trading in futures contracts involves, to varying degrees, risk of loss in excess of any futures variation margin reflected in the Statement of Assets and Liabilities. The measurement of risk associated with futures contracts is meaningful only when all related and offsetting transactions are considered. Gains and losses are realized upon the expiration or closing of the futures contracts.

Risks related to the use of futures contracts include possible illiquidity of the futures markets, contract prices that can be highly volatile and imperfectly correlated to movements in economically hedged security values and/or interest rates, and potential losses in excess of the Fund’s initial investment.

Open future contracts held at April 30, 2024, are listed in the Portfolio of Investments.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

25

 

BBH INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

For the six months ended April 30, 2024, the average monthly notional amount of open futures contracts was $276,887,934. The range of monthly notional amounts was $239,375,198 to $307,031,642.

Fair Values of Derivative Instruments as of April 30, 2024

Derivatives not accounted for as economically hedging instruments under authoritative guidance for derivatives instruments and hedging activities:

 

Risk

  

Asset Derivatives

  

Liability Derivatives

Statement of Assets
and Liabilities
Location

  

Fair Value

  

Statement of Assets
and Liabilities
Location

  

Fair Value
   

Interest Rate Risk

  

Net unrealized
appreciation/
(depreciation) on
futures contracts

  

$890,625

*

  

Net unrealized
appreciation/
(depreciation) on
futures contracts

  

$(7,597,173

)*
           

 

 

      

 

 
   

Total

      

$ 890,625

 

      

$(7,597,173

)

____________

*   Includes cumulative appreciation/(depreciation) of futures contracts as reported in the Statement of Assets and Liabilities and Notes to Financial Statements. Only the current day’s variation margin is reported within the Statement of Assets and Liabilities.

 

Effect of Derivative Instruments on the Statement of Operations

    
       

Interest Rate Risk
   

Net Realized Loss on Derivatives

  

 

  

 
   

Futures Contracts

  

$

(2,264,218

)
       

 

  

 
   

Net Change in Unrealized Appreciation/(Depreciation) on Derivatives

  

 

  

 
   

Futures Contracts

  

$

5,643,900

 

E. Private Placement Securities. The Fund may purchase securities that are not registered under the Securities Act of 1933, as amended (“1933 Act”) but that can be sold to “qualified institutional buyers” in accordance with the requirements stated in Rule 144A or the requirements stated in Regulation S and Regulation D of the 1933 Act (“Private Placement Securities”). A Private Placement Security may be considered illiquid, under the U.S. Securities and Exchange Commission (“SEC”) Regulations for open-end investment companies, and therefore subject to the 15% limitation on the purchase of illiquid securities, unless it is determined on an ongoing basis that an adequate trading market exists for the security, which is the case for the Fund. Guidelines have been adopted and the daily function of determining and monitoring liquidity of Private Placement Securities has been delegated to the investment adviser. All relevant factors will be considered in determining the

 

26

    

 

BBH INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

liquidity of Private Placement Securities and all investments in Private Placement Securities will be carefully monitored. Information regarding Private Placement Securities is included at the end of the Portfolio of Investments.

F. Loan Participations and Assignments. The Fund may invest in loan participations and assignments, which include institutionally traded floating and fixed-rate debt securities generally acquired as an assignment from another holder of, or participation interest in, loans originated by a bank or financial institution (the “Lender”) that acts as agent for all holders. Some loan participations and assignments may be purchased on a “when-issued” basis. The agent administers the terms of the loan, as specified in the loan agreement. When investing in a loan assignment, the Fund acquires the loan in whole or in part and becomes a lender under the loan agreement. The Fund generally has the right to enforce compliance with the terms of the loan agreement with the borrower.

Assignments and participations involve credit, interest rate, and liquidity risk. Interest rates on floating rate securities adjust with interest rate changes and/or issuer credit quality, and unexpected changes in such rates could result in losses to the Fund. The interest rates paid on a floating rate security in which the Fund invests generally are readjusted periodically to an increment over a designated benchmark rate, such as the one-month, three-month, six-month, or one-year Secured Overnight Financing Rate (“SOFR”).

The Fund may have difficulty trading assignments and participations to third parties. There may be restrictions on transfer and only limited opportunities may exist to sell such securities in secondary markets. As a result, the Fund may be unable to sell assignments or participations at the desired time or may be able to sell only at a price less than fair market value. The Fund utilizes an independent third party to value individual loan participations and assignments on a daily basis.

G. Federal Income Taxes. It is the Trust’s policy to comply with the requirements of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. The Fund files a tax return annually using tax accounting methods required under provisions of the Code, which may differ from GAAP, which is the basis on which these financial statements are prepared. Accordingly, the amount of net investment income and net realized gain reported in these financial statements may differ from that reported on the Fund’s tax return, due to certain book-to-tax timing differences such as losses deferred due to “wash sale” transactions and utilization of capital loss carryforwards. These differences may result in temporary over-distributions for financial statement purposes and are classified as distributions in excess of accumulated net realized gains or net investment income. These distributions do not constitute a return of capital. Permanent differences are reclassified between paid-in capital and retained earnings/(accumulated deficit) within the Statement of Assets and Liabilities based upon their tax classification. As such, the character of distributions to shareholders reported in the Financial Highlights table may differ from that reported to shareholders on Form 1099-DIV.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

27

 

BBH INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

The Fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (“ASC 740”). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The Fund did not have any unrecognized tax benefits as of October 31, 2023, nor were there any increases or decreases in unrecognized tax benefits for the period then ended. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits as an income tax expense in the Statement of Operations. During the six months ended April 30, 2024, the Fund did not incur any such interest or penalties. The Fund is subject to examination by U.S. federal and state tax authorities for returns filed for the prior three fiscal years. The Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

H. Dividends and Distributions to Shareholders. Dividends and distributions from net investment income to shareholders are declared daily and paid monthly to shareholders. Distributions from net capital gains, if any, are generally declared and paid annually and are recorded on the ex-dividend date. The Fund declared dividends in the amount of $25,711,027 to Class I shareholders during the six months ended April 30, 2024.

The tax character of distributions paid during the years ended October 31, 2023 and 2022, respectively, were as follows:

 

Distributions paid from:
   

Ordinary
income

  

Net
long-term
capital gain

  

Total 
taxable
distributions

  

Tax return
of capital

  

Total
distributions
paid

2023:

  

$

37,555,733

  

$

—

  

$

37,555,733

  

$

—

  

$

37,555,733

2022:

  

 

21,910,553

  

 

—

  

 

21,910,553

  

 

—

  

 

21,910,553

As of October 31, 2023 and 2022, respectively, the components of retained earnings/(accumulated deficit) on tax basis were as follows:

 

Components of retained earnings/(accumulated deficit):
   

Undistributed
ordinary
income

  

Undistributed
long-term
capital gain

  

Accumulated
capital and
other losses

  

Other
book/tax
temporary
differences

  

Unrealized
appreciation/
(depreciation)

  

Total
retained
earnings/
(accumulated
deficit)

2023:

  

$

93,181

  

$

—

  

$

(71,475,095

)

  

$

10,909,765

  

$

(74,959,915

)

  

$

(135,432,064

)

2022:

  

 

28,575

  

 

—

  

 

(48,543,872

)

  

 

13,306,759

  

 

(74,652,744

)

  

 

(109,861,282

)

The Fund had $71,475,095 net capital loss carryforwards as of October 31, 2023, of which $33,306,628 and $38,168,467, is attributable to short-term and long-term capital losses, respectively.

The Fund is permitted to carryforward capital losses for an unlimited period and they will retain their character as either short-term or long-term capital.

 

28

    

 

BBH INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

Total distributions paid may differ from amounts reported in the Statements of Changes in Net Assets because, for tax purposes, dividends are recognized when actually paid.

The differences between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable primarily to the tax deferral of losses on wash sales and paydowns on fixed income securities.

To the extent future capital gains are offset by capital loss carryforwards, if any, such gains will not be distributed.

I.  Use of Estimates. The preparation of the financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increase and decrease in net assets from operations during the reporting period. Actual results could differ from these estimates.

3. Fees and Other Transactions with Affiliates.

A. Investment Advisory and Administrative Fees. Effective June 27, 2018 (commencement of operations), under a combined Investment Advisory and Administrative Services Agreement (“Agreement”) with the Trust, Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“Investment Adviser”) provides investment advisory, portfolio management and administrative services to the Fund. The Fund pays a combined fee for investment advisory and administrative services calculated daily and paid monthly at an annual rate equivalent to 0.40% per annum. For the six months ended April 30, 2024, the Fund incurred $1,799,917 for services under the Agreement.

B. Investment Advisory and Administrative Fee Waivers. Effective June 27, 2018 (commencement of operations), the Investment Adviser has contractually agreed to waive fees and/or reimburse expenses in order to limit the total annual fund operating expenses (excluding interests, taxes, brokerage commissions, other expenditures that are capitalized in accordance with generally accepted accounting principles, and other extraordinary expenses not incurred in the ordinary course of the Fund’s business) for Class I shares to 0.50%. The agreement will terminate on March 1, 2025, unless it is renewed by all parties to the agreement. The agreement may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024, the Investment Adviser waived fees in the amount of $0 for Class I.

C. Custody and Fund Accounting Fees. BBH acts as a custodian and fund accountant and receives custody and fund accounting fees from the Fund calculated daily and paid monthly. BBH holds all of the Fund’s cash and investments and calculates the Fund’s daily net asset value. The custody fee is based partially on asset values and partially on individual fund transactions. The fund accounting fee is primarily an asset-based fee calculated at 0.325 basis points per annum of the Fund’s net asset value. For the six months ended April 30, 2024, the Fund incurred $65,370 in custody and

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

29

 

BBH INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

fund accounting fees. The Fund receives interest income on cash balances held by the custodian at the BBH Base Rate. The BBH Base Rate is defined as BBH’s effective trading rate in local money markets on each day. The total interest earned by the Fund for the six months ended April 30, 2024 was $16,711. This amount is included in “Interest income from Custodian” in the Statement of Operations. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to their agreement, the Fund will pay the BBH Overdraft Base Rate plus 2% on the day of the overdraft. The Fund did not incur any such fees during the six months ended April 30, 2024. This amount, if any, is included under line item “Custody and fund accounting fees” in the Statement of Operations.

D. Board of Trustees’ Fees. Each Trustee who is not an “interested person” as defined under the 1940 Act receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the six months ended April 30, 2024, the Fund incurred $42,711 in independent Trustee compensation and expense reimbursements.

E. Officers of the Trust. Officers of the Trust are also employees of BBH. Officers are paid no fees by the Trust for their services to the Trust.

4. Investment Transactions. For the six months ended April 30, 2024, the cost of purchases and the proceeds of sales of investment securities, other than short-term investments, were $385,965,081 and $185,587,883, respectively.

5. Shares of Beneficial Interest. The Trust is permitted to issue an unlimited number of Class I shares of beneficial interest, at no par value. Transactions in Class I shares were as follows:

     

For the six months ended
April 30, 2024 (unaudited)

  

For the year ended
October 31, 2023
   

Shares

  

Dollars

  

Shares

  

Dollars

Class I

    

 

  

 

  

 

    

 

  

 

  

 

Shares sold

  

28,617,730

 

  

$

251,482,861

 

  

43,293,311

 

  

$

377,670,836

 

Shares issued in connection with reinvestments of dividends

  

463,872

 

  

 

4,083,495

 

  

561,634

 

  

 

4,877,819

 

Proceeds from short-term redemption fees

  

N/A

 

  

 

2,793

 

  

N/A

 

  

 

7,073

 

Shares redeemed

  

(6,652,870

)

  

 

(58,109,450

)

  

(15,212,056

)

  

 

(131,621,537

)

Net increase

  

22,428,732

 

  

$

197,459,699

 

  

28,642,889

 

  

$

250,934,191

 

 

30

    

 

BBH INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

6. Principal Risk Factors and Indemnifications.

A. Principal Risk Factors. Investing in the Fund may involve certain risks, as discussed in the Fund’s prospectus, including but not limited to, those described below:

A shareholder may lose money by investing in the Fund (investment risk). The Fund is actively managed and the decisions by the Investment Adviser may cause the Fund to incur losses or miss profit opportunities (management risk). In the normal course of business, the Fund invests in securities and enters into transactions where risks exist due to failure of a counterparty to a transaction to perform (credit risk), changes in interest rates (interest rate risk), higher volatility for securities with longer maturities (maturity risk), financial performance or leverage of the issuer (issuer risk), difficulty in being able to purchase or sell a security (illiquid investment risk), or certain risks associated with investing in foreign securities not present in domestic investments, including, but not limited to, recovery of tax withheld by foreign jurisdictions (non-U.S. investment risk). Investments in other investment companies are subject to market and selection risk, as well as the specific risks associated with the investment companies’ portfolio securities (investment in other investment companies risk), and risks from investing in securities of issuers based in developing countries (emerging markets risk). The Fund’s use of derivatives creates risks that are different from, or possibly greater than, the risks associated with investing directly in securities as the Fund could lose more than the principal amount invested (derivatives risk). Political, legislative and economic events may affect a municipal security’s value, interest payments, repayments of principal and the Fund’s ability to sell it (municipal issuer risk). Due to uncertainty regarding the ability of the issuer to pay principal and interest, securities that are rated below investment grade (i.e., Ba1/BB+ or lower) (junk bond risk), and their unrated equivalents, may be subject to greater risks than securities which have higher credit ratings, including a high risk of default. If the issuer of the securities in which the Fund invests redeems them before maturity the Fund may have to reinvest the proceeds in securities that pay a lower interest rate (call risk). The Fund invests in asset-backed (asset-backed securities risk) and mortgage-backed securities (mortgage-backed securities risk) which are subject to the risk that borrowers may default on the obligations that underlie these securities. In addition, these securities may be paid off sooner (prepayment risk) or later than expected which may increase the volatility of securities during periods of fluctuating interest rates. The Fund may invest in bonds issued by foreign governments which may be unable or unwilling to make interest payments and/or repay the principal owed (sovereign debt risk). The Fund’s use of borrowing, in reverse repurchase agreements and investment in some derivatives, involves leverage. Leverage tends to exaggerate the effect of any increase or decrease in the value of the Fund’s securities and may cause the Fund to be more volatile (leverage risk). Loan participations and assignment, delayed funding loans and revolving credit facilities may have the effect of requiring the Fund to increase its investments in a company at a time when it might not otherwise decide to do so (loan risk). The value of securities held by the Fund may decline in response to certain events, including: those directly involving the companies or issuers whose securities are held by the Fund; conditions affecting the general economy; overall

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

31

 

BBH INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

market changes; local, regional or political, social or economic instability; and currency and interest rate and price fluctuations. Natural disasters, the spread of infectious illness and other public health emergencies, recession, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse effects on world economies and markets generally (market risk). A significant investment of Fund assets within one or more sectors, industries, securities and/or durations may increase the Fund’s sensitivity to adverse economic, business, political, or other, risks associated with such sector, industry, security or duration (sector risk). The Fund’s shareholders may be adversely impacted by asset allocation decisions made by an investment adviser whose discretionary clients make up a large percentage of the Fund’s shareholders (large shareholder risk). Even though the Fund’s investments in repurchase agreements are collateralized at all times, there is risk to the Fund if the other party to the agreement should default on its obligations (repurchase agreement risk). While the U.S. Government has historically provided financial support to U.S. government-sponsored agencies or instrumentalities during times of financial stress, such as the various actions taken to stabilize the Federal National Mortgage Association and Federal Home Loan Mortgage Corporation during the credit crisis of 2008, no assurance can be given that it will do so in the future. Such securities are neither issued nor guaranteed by the U.S. Treasury (U.S. Government Agency Securities Risk). The Fund may invest in private placement securities that are issued pursuant to Regulation S, Regulation D and Rule 144A which have not been registered with the SEC. These securities may be subject to contractual restrictions which prohibit or limit their resale (private placement risk). The United Kingdom’s Financial Conduct Authority announced a phase out of the London Interbank Offered Rate (“LIBOR”). Although many LIBOR rates were phased out by the end of 2021, some USD LIBOR settings will continue to be published under a synthetic methodology until September 30, 2024 for certain legacy contracts. The SOFR has been used increasingly on a voluntary basis in new instruments and transactions. Under U.S. regulations that implement a statutory fallback mechanism to replace LIBOR, benchmark rates based on SOFR have replaced LIBOR in certain financial contracts. Any pricing adjustments to the fund’s investments resulting from a substitute reference rate may also adversely affect the fund’s performance and/or net asset value (LIBOR transition risk). The Fund may invest in convertible securities which may perform in a similar manner to a regular debt security and are subject to variety of risks, including investment risk and interest rate risk (convertible securities risk). The Fund may invest in preferred securities which are equity interests in a company that entitle the holder to receive common stock, dividends and a fixed share of the proceeds resulting from a liquidation of the company, in preference to the holders of other securities. Preferred securities are subject to issuer specific and market risks applicable generally to equity securities (preferred securities risk). The Fund may also invest in notes issued by Business Development Companies (“BDCs”). These notes are subject to risks similar to those of other issuers and those of investment companies (business development company risk). The extent of the Fund’s exposure to these risks in respect to these financial assets is included in their value as recorded in the Fund’s Statement of Assets and Liabilities.

Please refer to the Fund’s prospectus for a complete description of the principal risks of investing in the Fund.

 

32

    

 

BBH INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

B. Indemnifications. Under the Trust’s organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the Fund, and shareholders are indemnified against personal liability for the obligations of the Trust. Additionally, in the normal course of business, the Fund enters into agreements with service providers that may contain indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss from such claims is considered remote.

7.  Subsequent Events. Management has evaluated events and transactions that have occurred since April 30, 2024 through the date the financial statements were issued and determined that there were no subsequent events that would require recognition or additional disclosure in the financial statements.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

33

 

BBH INCOME FUND

DISCLOSURE OF FUND EXPENSES

April 30, 2024 (unaudited)

EXAMPLE

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested distributions, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the six-month period and held for the entire period (November 1, 2023, to April 30, 2024).

ACTUAL EXPENSES

The first line of the table provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during the period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% Hypothetical Example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

 

34

    

 

BBH INCOME FUND

DISCLOSURE OF FUND EXPENSES (continued)

April 30, 2024 (unaudited)

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

Beginning
Account Value
November 1, 2023

  

Ending
Account Value
April 30, 2024

  

Expenses Paid
During Period
November 1, 2023 to
April 30, 20241

Class I

            

Actual

  

$1,000

  

$1,071

  

$2.32

Hypothetical2

  

$1,000

  

$1,023

  

$2.26

____________

​1    Expenses are equal to the Fund’s annualized net expense ratio of 0.45% for Class I shares, multiplied by the average account value over the period and multiplied by 182/366 (to reflect the one-half year period).

​2    Assumes a return of 5% before expenses. For the purposes of the calculation, the applicable annualized expenses ratio for each class of shares is subtracted from the assumed return before expenses.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

35

 

BBH INCOME FUND

DISCLOSURE OF ADVISOR SELECTION

April 30, 2024 (unaudited)

Investment Advisory and Administrative Services Agreement Approval

The 1940 Act requires that a fund’s investment advisory agreements must be approved both by a fund’s board of trustees and by a majority of the trustees who are not parties to the investment advisory agreements or “interested persons” of any party (“Independent Trustees”), cast in person at a meeting called for the purpose of voting on such approval.

The Board, a majority of which is comprised of Independent Trustees, held a telephonic meeting on November 16, 2023 and an in-person meeting on December 12, 2023, in reliance on the Exemptive Relief, to consider whether to renew the combined Amended and Restated Investment Advisory and Administrative Services Agreement (the “Agreement”) between the Trust and the Investment Adviser with respect to the existing funds in the Trust, including the Fund. At the December 12, 2023 meeting, the Board voted to approve the renewal of the Agreement with respect to the Fund for an additional one-year term. In doing so, the Board determined that the terms of the Agreement were fair and reasonable and in the best interest of the Fund and its shareholders, and that it had received sufficient information to make an informed business decision with respect to the continuation of the Agreement.

Both in the meetings specifically held to address the continuance of the Agreement and at other meetings over the course of the year, the Board requested, received and assessed a variety of materials provided by the Investment Adviser and BBH, including, among other things, information about the nature, extent and quality of the services provided to the Fund by the Investment Adviser and BBH, including investment management, administrative and shareholder services, the oversight of Fund service providers, marketing, risk oversight, compliance, and the ability to meet applicable legal and regulatory requirements. The Board also received third-party comparative performance and fee and expense information for the Fund prepared by Broadridge Financial Solutions, Inc. (“Broadridge”) using data from Lipper Inc., an independent provider of investment company data (“Lipper Report”). The Board reviewed this report with Broadridge, counsel to the Trust (“Fund Counsel”) and BBH. The Board received from, and discussed with, Fund Counsel a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements under the 1940 Act, as well as the guidance provided in Gartenberg v. Merrill Lynch Asset Management, Inc., which was affirmed in Jones v. Harris Associates, L.P. In addition, the Board met in executive session outside the presence of Fund management.

In approving the continuation of the Agreement, the Board considered: (a) the nature, extent and quality of services provided by the Investment Adviser; (b) the investment performance of the Fund; (c) the advisory fee and the cost of the services and profits to be realized by the Investment Adviser from its relationship with the Fund; (d) the Fund’s costs to investors compared to the costs of comparative funds; (e) the sharing of potential economies of scale; (f) fall-out benefits to the Investment Adviser as a result of its relationship with the Fund; and (g) other factors deemed relevant by the Board. The following is a summary of certain factors the Board considered in making its determination to approve the continuance of the Agreement. No single factor reviewed by the Board was identified as the principal factor in determining whether to approve the Agreement, and individual Trustees may have given different weight to various factors. The

 

36

    

 

BBH INCOME FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Board reviewed these factors with Fund Counsel. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the expense information, the cost of the services provided, and the profits realized by the Investment Adviser.

Nature, Extent and Quality of Services

The Board noted that, under the Agreement and with respect to the Fund, the Investment Adviser, subject to the supervision of the Board, is responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Fund’s investment objective and policies. The Board further noted that, as a combined investment advisory and administration agreement, the Agreement also contemplates the provision of administrative services by the Investment Adviser to the Fund within the same fee structure. The Board received and considered information during the December 12, 2023 meeting, and over the course of the previous year, regarding the nature, extent and quality of services provided to the Trust and the Fund by the Investment Adviser including: portfolio management, the supervision of operations and compliance, preparation of regulatory filings, disclosures to Fund shareholders, general oversight of service providers, organizing Board meetings and preparing the materials for such Board meetings, assistance to the Board (including the Independent Trustees in their capacity as Trustees), legal and Chief Compliance Officer services for the Trust, and other services necessary for the operation of the Fund. The Board considered the resources of the Investment Adviser and BBH, as a whole, dedicated to the Fund noting that, pursuant to separate agreements, BBH also provides custody, shareholder servicing, and fund accounting services to the Fund. The Board considered the depth and range of services provided pursuant to the Agreement, noting that the Investment Adviser also coordinates the provision of services to the Fund by affiliated and nonaffiliated service providers.

The Board considered the scope and quality of services provided by the Investment Adviser under the Agreement. The Board reviewed the qualifications of the key investment personnel primarily responsible for the day-to-day portfolio management of the Fund. The Board also considered the policies and practices followed by BBH and the Investment Adviser. The Board noted that during the course of its regular meetings, it received reports on each of the foregoing topics. The Board concluded that, overall, it was satisfied with the nature, extent and quality of the investment advisory and administrative services provided, and expected to be provided, to the Fund pursuant to the Agreement.

Fund Performance

At the November 16, 2023 and December 12, 2023 meetings, and throughout the year, the Board received and considered performance information for the Fund provided by BBH. The Board also considered the Fund’s performance relative to a peer category of other mutual funds in a report compiled by Broadridge. As part of this review, the Trustees considered the composition of the peer category, selection criteria and reputation of Broadridge who prepared the peer category analysis. The Board reviewed and discussed

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

37

 

BBH INCOME FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

with both BBH and Broadridge the report’s findings and discussed the positioning of the Fund relative to its selected peer category. The Board considered investment performance for the Fund over the 1-, 2-, 3-, 4- and 5-year periods ended September 30, 2023 as compared to a its peer category, noting the Fund’s below average performance during the 1- and 2- year periods, and its above average performance in the 3-, 4- and 5-year periods. In evaluating the performance of the Fund, the Board considered the risk expectations for the Fund as well as the relevant market conditions for the Fund’s investments and investment strategy. Based on this information, and in light of the Fund’s investment style, the Board concluded that it was satisfied with the Fund’s investment results.

Costs of Services Provided and Profitability

The Board considered the fee rates paid by the Fund to the Investment Adviser in light of the nature, extent and quality of the services provided to the Fund. The Board also considered and reviewed the fee waiver arrangement that was in place for the Fund and considered the actual fee rates after taking into account the contractual fee waiver. The Board noted that they had previously received and considered information comparing the Fund’s combined investment advisory and administration fee and the Fund’s net operating expenses with those of other comparable mutual funds, such peer category and comparisons having been selected and calculated by Broadridge. The Board recognized that it is difficult to make comparisons of the fee rate, or of combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds. The Board concluded that the advisory and administration fee appeared to be both reasonable in light of the services rendered and the result of arm’s length negotiations.

With regard to profitability, the Trustees considered the compensation and benefits flowing to the Investment Adviser and BBH, directly or indirectly. The Board reviewed profitability data for the Fund using data from October 1, 2022 through September 30, 2023, for both the Investment Adviser and BBH. The data also included the effect of revenue generated by the shareholder servicing, custody and fund accounting fees paid by the Fund to BBH and corresponding expenses. The Board conducted a detailed review of the expense allocation methods used in preparing the profitability data. The Board focused on profitability of the Investment Adviser and BBH’s relationships with the Fund before taxes and distribution expenses. The Board concluded that the Investment Adviser’s and BBH’s profitability was not excessive in light of the nature, extent and quality of services provided to the Fund.

The Board also considered the effect of fall-out benefits to the Investment Adviser and BBH such as the increased visibility of BBH’s investment management business due to the distribution of the Trust’s funds. The Board considered other benefits received by BBH and the Investment Adviser as a result of their relationships with the Fund. These other benefits include fees received for being the Fund’s administrator, custodian, fund accounting and shareholder servicing agent. In light of the costs of providing services pursuant to the Agreement as well as the Investment Adviser and BBH’s commitment to the Fund, the ancillary benefits that the Investment Adviser and BBH received were considered reasonable.

 

38

    

 

BBH INCOME FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Economies of Scale

The Board also considered the existence of any economies of scale and whether those economies are passed along to the Fund’s shareholders through a graduated investment advisory fee schedule or other means, including any fee waivers by the Investment Adviser and BBH. The Board considered the fee schedule for the Fund on the information they had been provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Fund, there appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints apply. In light of the Fund’s current size and expense structure, the Board concluded that the current breakpoints for the Fund were reasonable. Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the comparative performance, expense information, the cost of the services provided and the profits realized by the Investment Adviser.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

39

 

BBH INCOME FUND

CONFLICTS OF INTEREST

April 30, 2024 (unaudited)

BBH&Co., including the Investment Adviser, provides discretionary and non-discretionary investment management services and products to corporations, institutions and individual investors throughout the world. As a result, in the ordinary course of its businesses, BBH&Co., including the Investment Adviser, may engage in activities in which its interests or the interests of its clients may conflict with or be adverse to the interests of the Funds. In addition, certain of such clients (including the Funds) utilize the services of BBH&Co. for which they will pay to BBH&Co. customary fees and expenses that will not be shared with the Funds.

The Investment Adviser and the Sub-advisers have adopted and implemented policies and procedures that seek to manage conflicts of interest. Pursuant to such policies and procedures, the Investment Adviser and each Sub-adviser monitor a variety of areas, including compliance with fund investment guidelines, the investment in only those securities that have been approved for purchase, and compliance with their respective Code of Ethics.

The Trust also manages these conflicts of interest. For example, the Trust has designated a CCO and has adopted and implemented policies and procedures designed to manage the conflicts identified below and other conflicts that may arise in the course of the Funds’ operations in such a way as to safeguard the Funds from being negatively affected as a result of any such potential conflicts. From time to time, the Trustees receive reports from the Investment Adviser, the Sub-advisers and the Trust’s CCO on areas of potential conflict.

Investors should carefully review the following, which describes potential and actual conflicts of interest that BBH&Co., the Investment Adviser and Sub-advisers can face in the operation of their respective investment management services. This section is not, and is not intended to be, a complete enumeration or explanation of all of the potential conflicts of interest that may arise. The Investment Adviser, the Sub-advisers and the Funds has adopted policies and procedures reasonably designed to appropriately prevent, limit or mitigate the conflicts of interest described below. Additional information about potential conflicts of interest regarding the Investment Adviser is set forth in the Investment Adviser’s Form ADV. A copy of Part 1 and Part 2A of the Investment Adviser’s Form ADV is available on the SEC’s website (www.adviserinfo.sec.gov). In addition, many of the activities that create these conflicts of interest are limited and/or prohibited by law, unless an exception is available.

Other Clients and Allocation of Investment Opportunities. BBH&Co., the Investment Adviser, and the Sub-advisers manage funds and accounts of clients other than the Funds (“Other Clients”). In general, BBH&Co., the Investment Adviser, and the Sub-advisers face conflicts of interest when they render investment advisory services to different clients and, from time to time, provide dissimilar investment advice to different clients. Investment decisions will not necessarily be made in parallel among the Funds and Other Clients. Investments made by the Funds do not, and are not intended to, replicate the investments, or the investment methods and strategies, of Other Clients. Accordingly, such Other Clients may produce results that are materially different from those experienced by the Funds. Certain other conflicts of interest may arise in connection with a portfolio manager’s management of the Funds’ investments, on the one hand, and the investments of other funds or accounts for which the portfolio

 

40

    

 

BBH INCOME FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

manager is responsible, on the other. For example, it is possible that the various funds or accounts managed by the Investment Adviser or Sub-advisers could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Funds. From time to time, the Investment Adviser and Sub-advisers, sponsor and with other investment pools and accounts which engage in the same or similar businesses as the Funds using the same or similar investment strategies. To the extent that the same investment opportunities might be desirable for more than one account or fund, possible conflicts could arise in determining how to allocate them because the Investment Adviser or Sub-advisers may have an incentive to allocate investment opportunities to certain accounts or funds. However, BBH&Co. and the Investment Adviser have implemented policies and procedures designed to ensure that information relevant to investment decisions is disseminated promptly within its portfolio management teams and investment opportunities are allocated equitably among different clients. The policies and procedures require, among other things, objective allocation for limited investment opportunities, and documentation and review of justifications for any decisions to make investments only for select accounts or in a manner disproportionate to the size of the account. Nevertheless, access to investment opportunities may be allocated differently among accounts due to the particular characteristics of an account, such as size of the account, cash position, tax status, risk tolerance and investment restrictions or for other reasons.

Actual or potential conflicts of interest may also arise when a portfolio manager has management responsibilities to multiple accounts or funds, resulting in unequal commitment of time and attention to the portfolio management of the funds or accounts.

Affiliated Service Providers. Other potential conflicts might include conflicts between the Funds and its affiliated and unaffiliated service providers (e.g., conflicting duties of loyalty). In addition to providing investment management services through the SID, BBH&Co. provides administrative, custody, shareholder servicing and fund accounting services to the Funds. BBH&Co. may have conflicting duties of loyalty while servicing the Funds and/or opportunities to further its own interest to the detriment of the Funds. For example, in negotiating fee arrangements with affiliated service providers, BBH&Co. may have an incentive to agree to higher fees than it would in the case of unaffiliated providers. BBH&Co. acting in its capacity as the Funds’ administrator is the primary valuation agent of the Funds. BBH&Co. values securities and assets in the Funds according to the Funds’ valuation policies. Because the Investment Adviser’s advisory and administrative fees are calculated by reference to a Funds’ net assets, BBH&Co. and its affiliates may have an incentive to seek to overvalue certain assets.

Aggregation. Potential conflicts of interest also arise with the aggregation of trade orders. Purchases and sales of securities for the Funds may be aggregated with orders for other client accounts managed by the Sub-advisers. The Sub-advisers, however, are not required to aggregate orders if portfolio management decisions for different accounts are made separately, or if it is determined that aggregating is not practicable, or in cases involving client direction. Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds will be charged or credited with the

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

41

 

BBH INCOME FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

average price. Thus, the effect of the aggregation may operate on some occasions to the disadvantage of the Funds. In addition, under certain circumstances, the Funds will not be charged the same commission or commission equivalent rates in connection with an aggregated order.

Cross Trades. Under certain circumstances, the Investment Adviser, on behalf of the Funds, may seek to buy from or sell securities to another fund or account advised by BBH, the Investment Adviser. Subject to applicable law and regulation, BBH&Co., the Investment Adviser may (but is not required to) effect purchases and sales between BBH&Co., the Investment Adviser clients (“cross trades”), including the Funds, if BBH&Co., the Investment Adviser or a Fund’s Sub-adviser believes such transactions are appropriate based on each party’s investment objectives and guidelines. There may be potential conflicts of interest or regulatory issues relating to these transactions which could limit the Investment Adviser’s decision to engage in these transactions for the Funds. BBH&Co., the Investment Adviser and/or a Fund’s Sub-adviser may have a potentially conflicting division of loyalties and responsibilities to the parties in such transactions.

Soft Dollars. The Investment Adviser may direct brokerage transactions and/or payment of a portion of client commissions (“soft dollars”) to specific brokers or dealers or other providers to pay for research or other appropriate services which provide, in the Investment Adviser’s view, appropriate assistance in the investment decision-making process (including with respect to futures, fixed price offerings and over-the-counter transactions). The use of a broker that provides research and securities transaction services may result in a higher commission than that offered by a broker who does not provide such services. The Investment Adviser will determine in good faith whether the amount of commission is reasonable in relation to the value of research and services provided and whether the services provide lawful and appropriate assistance in its investment decision-making responsibilities.

Research or other services obtained in this manner may be used in servicing any or all of the Funds and other accounts managed by the Investment Adviser, including in connection with accounts that do not pay commissions to the broker related to the research or other service arrangements. Such products and services may disproportionately benefit other client accounts relative to the Funds based on the amount of brokerage commissions paid by the Funds and such other accounts. To the extent that a Sub-adviser uses soft dollars, it will not have to pay for those products and services itself.

BBH&Co. may receive research that is bundled with the trade execution, clearing, and/or settlement services provided by a particular broker-dealer. To the extent that a Sub-adviser receives research on this basis, many of the same conflicts related to traditional soft dollars may exist. For example, the research effectively will be paid by client commissions that also will be used to pay for the execution, clearing, and settlement services provided by the broker-dealer and will not be paid by the Sub-adviser.

Arrangements regarding compensation and delegation of responsibility may create conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades, administration of investment advice and valuation of securities.

 

42

    

 

BBH INCOME FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Investments in BBH Funds. From time to time BBH&Co. may invest a portion of the assets of its discretionary investment advisory clients in the Funds. That investment by BBH&Co. on behalf of its discretionary investment advisory clients in the Funds may be significant at times.

Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of scale that tend to reduce the Funds’ expense ratio. In selecting the Funds for its discretionary investment advisory clients, BBH&Co. may limit its selection to funds managed by BBH&Co. or the Investment Adviser. BBH&Co. may not consider or canvass the universe of unaffiliated investment companies available, even though there may be unaffiliated investment companies that may be more appropriate or that have superior performance. BBH&Co., the Investment Adviser and their affiliates providing services to the Funds benefit from additional fees when the Funds is included as an investment by a discretionary investment advisory client.

BBH&Co. reserves the right to redeem at any time some or all of the shares of the Funds acquired for its discretionary investment advisory clients’ accounts. A large redemption of shares of the Funds by BBH&Co. on behalf of its discretionary investment advisory clients could significantly reduce the asset size of the Funds, which might have an adverse effect on the Funds’ investment flexibility, portfolio diversification and expense ratio.

Valuation. When market quotations are not readily available or are believed by BBH&Co. to be unreliable, the Funds’ investments will be valued at fair value by BBH&Co. pursuant to procedures adopted by the Funds’ Board. When determining an asset’s “fair value,” BBH&Co. seeks to determine the price that a Fund might reasonably expect to receive from the current sale of that asset in an arm’s-length transaction. The price generally may not be determined based on what the Funds might reasonably expect to receive for selling an asset at a later time or if it holds the asset to maturity. While fair value determinations will be based upon all available factors that BBH&Co. deems relevant at the time of the determination and may be based on analytical values determined by BBH&Co. using proprietary or third-party valuation models, fair value represents only a good faith approximation of the value of a security. The fair value of one or more securities may not, in retrospect, be the price at which those assets could have been sold during the period in which the particular fair values were used in determining the Funds’ net asset value. As a result, the Funds’ sale or redemption of its shares at net asset value, at a time when a holding or holdings are valued by BBH&Co. (pursuant to Board-adopted procedures) at fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.

Referral Arrangements. BBH&Co. may enter into advisory and/or referral arrangements with third parties. Such arrangements may include compensation paid by BBH&Co. to the third party. BBH&Co. may pay a solicitation fee for referrals and/or advisory or incentive fees. BBH&Co. may benefit from increased amounts of assets under management.

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

43

 

BBH INCOME FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Personal Trading. BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, face conflicts of interest when transacting in securities for their own accounts because they could benefit by trading in the same securities as the Funds, which could have an adverse effect on the Funds. However, the Investment Adviser has implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policy and procedures are intended to prevent BBH&Co. Partners and employees from trading in the same securities as the Funds. However, BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policies and procedures are intended to prevent BBH&Co. Partners and employees with access to Fund material non-public information from trading in the same securities as the Funds.

Gifts and Entertainment. From time to time, employees of BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, may receive gifts and/or entertainment from clients, intermediaries, or service providers to the Funds or BBH&Co., including the Investment Adviser, which could have the appearance of affecting or may potentially affect the judgment of the employees, or the manner in which they conduct business. The Investment Adviser has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees. BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees.

 

44

    

 

BBH INCOME FUND

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM

April 30, 2024 (unaudited)

The Securities and Exchange Commission adopted Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), to promote effective liquidity risk management throughout the open-end investment company industry in order to reduce the risk that funds will be unable to meet their redemption obligations and mitigate dilution of the interests of fund shareholders.

The Board of Trustees (the “Board”) of BBH Trust has appointed three members of the Brown Brothers Harriman & Co. Mutual Fund Advisory Department, the Investment Adviser to the funds of BBH Trust (the “Funds”), as the Program Administrator for each Fund’s liquidity risk management program (the “Program”). The Board met on March 6, 2024 to review the Program for the Funds pursuant to the Liquidity Rule. The Program Administrator provided the Board with a report (the “Report”) that addressed the operations of the Program and assessed its adequacy and effectiveness for the period from February 1, 2023 through January 31, 2024 (the “Reporting Period”).

The Report noted that the Program complied with the key factors for consideration under the Liquidity Rule for assessing, managing and periodically reviewing a Fund’s liquidity risk, including the following points.

Liquidity classification. The Report described the Program’s liquidity classification methodology for categorizing the Funds’ investments into one of four liquidity buckets. The Funds classified each of their investments into one of four liquidity categories based on the number of days reasonably needed to sell and convert a reasonably anticipated sized trade of each investment into cash without significantly impacting the price of the investments. The Program Administrator relied on a third-party data provider to facilitate the classification of each Fund’s investments based on criteria in each Fund’s Program. During the Reporting Period, no Fund held more than 15% of its net assets in illiquid investments.

Highly Liquid Investment Minimum. The Report noted that one aspect of the Liquidity Rule is a requirement that funds that are expected to have less than 50% of assets classified as other than “highly liquid” should establish a minimum percentage of highly liquid assets that the fund is expected to hold on an on-going basis. The Program Administrator monitors the percentages of assets in each category on an ongoing basis and, given that no Fund has approached the 50% threshold, has made the determination that it is not necessary to assign a Highly Liquid Investment Minimum to any of the Funds as provided for in the Liquidity Rule.

The Fund’s investment strategy and liquidity of portfolio investments during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed whether each Fund’s investment strategy is appropriate for an open-end fund structure with a focus on Funds with more significant and consistent holdings of less liquid and illiquid assets and factored a Fund’s concentration in an issuer into the liquidity classification methodology by taking issuer position sizes into account.

Short-term and long-term cash flow projections during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed historical redemption activity and used this information as a component to establish each Fund’s reasonably

 

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

45

 

BBH INCOME FUND

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM (continued)

April 30, 2024 (unaudited)

anticipated trading size. The Program Administrator also took into consideration other factors such as shareholder ownership concentration, applicable distribution channels and the degree of certainty associated with a Fund’s short-term and long-term cash flow projections.

Holdings of cash and cash equivalents. The Program Administrator considered the degree to which each Fund held cash and cash equivalents as a component of each Fund’s ability to meet redemption requests.

There were no material changes to the Program during the Reporting Period. The Program Administrator has informed the Board that it believes that the Fund’s Program is adequately designed, has been implemented as intended, and has operated effectively since its implementation. No material exceptions have been noted since the implementation of the Program, and there were no liquidity events that impacted the Fund or its ability to meet redemption requests on a timely basis during the Reporting Period.

 

46

    

 

BBH INCOME FUND

PORTFOLIO ALLOCATION

April 30, 2024 (unaudited)

 

Administrator
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005

Distributor
Alps Distributors, Inc.
1290 Broadway, Suite 1000
Denver, Co 80203

Shareholder Servicing Agent
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005
1-800-575-1265

To obtain information or make shareholder inquiries:

Investment Adviser
Brown Brothers Harriman
Mutual Fund Advisory Department
140 Broadway
New York, NY 10005

By telephone:
By E-mail send your request to:
On the internet:

Call 1-800-575-1265
bbhfunds@bbh.com
www.bbhfunds.com

This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund.

For more complete information, visit www.bbhfunds.com for a prospectus. You should consider the Fund’s investment objectives, risks, charges and expenses carefully before you invest. Information about these and other important subjects is in the Fund’s prospectus, which you should read carefully before investing.

Holdings and allocations are subject to change. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities. Current and future holdings are subject to risk.

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Forms N-PORT are available electronically on the SEC’s website (sec.gov). For a complete list of a fund’s portfolio holdings, view the most recent holdings listing, semi-annual report, or annual report on the Fund’s website at http://www.bbhfunds.com.

A summary of the Fund’s Proxy Voting Policy that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund’s portfolio, as well as a record of how the Fund voted any such proxies during the most recent 12-month period ended June 30, is available, without charge, upon request by calling the toll-free number listed above. This information is also available on the SEC’s website at www.sec.gov.

NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE

 

   

Semi-Annual Report

APRIL 30, 2024

BBH Select Series — Large Cap Fund

 

BBH SELECT SERIES – LARGE CAP FUND

PORTFOLIO ALLOCATION

April 30, 2024 (unaudited)

SECTOR DIVERSIFICATION

 

U.S. $ Value

  

Percent of
Net Assets

Common Stock:

  

 

      

 

Basic Materials

  

$

   24,044,226

  

5.5

%

Communications

  

 

 62,133,979

  

14.2

 

Consumer Cyclical

  

 

35,335,234

  

8.1

 

Consumer Non-Cyclical

  

 

93,955,565

  

21.4

 

Financials

  

 

90,255,348

  

20.6

 

Industrials

  

 

19,512,692

  

4.4

 

Technology

  

 

86,257,380

  

19.7

 

Cash and Other Assets in Excess of Liabilities

  

 

26,603,754

  

6.1

 

NET ASSETS

  

$

 438,098,178

  

100.0

%

All data as of April 30, 2024. The BBH Select Series - Large Cap Fund’s (the “Fund”) sector diversification is expressed as a percentage of net assets and may vary over time.

The accompanying notes are an integral part of these financial statements.

2

    

 

BBH SELECT SERIES – LARGE CAP FUND

PORTFOLIO OF INVESTMENTS

April 30, 2024 (unaudited)

All investments in the United States, except as noted.

Shares

      

Value
   

COMMON STOCK (93.9%)

  

 

  
   

BASIC MATERIALS (5.5%)

  

 

  

54,527

  

Linde, Plc. (Ireland)

  

$

24,044,226
   

Total Basic Materials

  

 

24,044,226
       

 

  
   

COMMUNICATIONS (14.2%)

  

 

  

191,389

  

Alphabet, Inc. (Class C)

  

 

31,510,285

89,540

  

Amazon.com, Inc.1

  

 

15,669,500

4,332

  

Booking Holdings, Inc.

  

 

14,954,194
   

Total Communications

  

 

62,133,979
       

 

  
   

CONSUMER CYCLICAL (8.1%)

  

 

  

169,524

  

Copart, Inc.1

  

 

9,206,848

22,835

  

Costco Wholesale Corp.

  

 

16,507,421

104,281

  

NIKE, Inc. (Class B)

  

 

9,620,965
   

Total Consumer Cyclical

  

 

35,335,234
           

 

  
   

CONSUMER NON-CYCLICAL (21.4%)

      

 

  

115,731

  

Abbott Laboratories

  

 

12,264,014

199,086

  

Alcon, Inc. (Switzerland)

  

 

15,445,092

22,982

  

Automatic Data Processing, Inc.

  

 

5,559,116

46,508

  

Diageo, Plc. ADR (United Kingdom)

  

 

6,425,545

55,213

  

Nestle S.A. ADR (Switzerland)

  

 

5,554,428

28,982

  

S&P Global, Inc.

  

 

12,051,585

26,669

  

Thermo Fisher Scientific, Inc.

  

 

15,167,194

17,460

  

UnitedHealth Group, Inc.

  

 

8,445,402

81,909

  

Zoetis, Inc. (Class A)

  

 

13,043,189
   

Total Consumer Non-Cyclical

  

 

93,955,565
       

 

  
   

FINANCIALS (20.6%)

  

 

  

70,842

  

Arthur J Gallagher & Co.

  

 

16,625,909

47

  

Berkshire Hathaway, Inc. (Class A)1

  

 

28,176,500

52,263

  

Mastercard, Inc. (Class A)

  

 

23,581,066

105,027

  

Progressive Corp.

  

 

21,871,873
   

Total Financials

  

 

90,255,348
       

 

  
   

INDUSTRIALS (4.4%)

  

 

  

93,802

  

Waste Management, Inc.

  

 

19,512,692
   

Total Industrials

  

 

19,512,692

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

3

 

BBH SELECT SERIES – LARGE CAP FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

All investments in the United States, except as noted.

Shares

      

Value
   

COMMON STOCK (continued)

  

 

  
   

TECHNOLOGY (19.7%)

  

 

  

19,165

  

Adobe, Inc.1

  

$

8,870,137

33,782

  

KLA Corp.

  

 

23,285,595

63,609

  

Microsoft Corp.

  

 

24,764,892

161,246

  

Oracle Corp.

  

 

18,341,732

62,323

  

Texas Instruments, Inc.

  

 

10,995,024
   

Total Technology

  

 

86,257,380
   

Total Common Stock

  

 

  
   

(Cost $251,748,056)

  

 

411,494,424
           

 

  

TOTAL INVESTMENTS (Cost $251,748,056)2

  

93.9%

  

$

411,494,424

CASH AND OTHER ASSETS IN EXCESS OF LIABILITIES

  

6.1%

  

 

26,603,754

NET ASSETS

  

100.00%

  

$

438,098,178

____________

​1   Non-income producing security.

​2   The aggregate cost for federal income tax purposes is $251,748,056, the aggregate gross unrealized appreciation is $162,398,892 and the aggregate gross unrealized depreciation is $2,652,524, resulting in net unrealized appreciation of $159,746,368.

Abbreviation:

ADR − American Depositary Receipt.

The accompanying notes are an integral part of these financial statements.

4

    

 

BBH SELECT SERIES – LARGE CAP FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

FAIR VALUE MEASUREMENTS

The Fund is required to disclose information regarding the fair value measurements of the Fund’s assets and liabilities. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The disclosure requirement established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including for example, the risk inherent in a particular valuation technique used to measure fair value including such a pricing model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the Fund’s own considerations about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

Authoritative guidance establishes three levels of the fair value hierarchy as follows:

— Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities.

— Level 2 – significant other observable inputs (including quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.).

— Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities).

Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. Inputs may include price information, specific and broad credit data, liquidity statistics, and other factors. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires judgment by the investment adviser. The investment adviser considers observable data to be that market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The categorization of a financial instrument within the hierarchy is based upon the pricing transparency of the instrument and does not necessarily correspond to the investment adviser’s perceived risk of that instrument.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

5

 

BBH SELECT SERIES – LARGE CAP FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Financial assets within Level 1 are based on quoted market prices in active markets. The Fund does not adjust the quoted price for these instruments.

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. These include investment-grade corporate bonds, U.S. Treasury notes and bonds, and certain non-U.S. sovereign obligations, listed equities and over-the-counter derivatives and foreign equity securities whose values could be impacted by events occurring before the Fund’s pricing time, but after the close of the securities’ primary markets and are, therefore, fair valued according to procedures adopted by the Board of Trustees. As Level 2 financial assets include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

Financial assets classified within Level 3 have significant unobservable inputs, as they trade infrequently. Level 3 financial assets include private equity and certain corporate debt securities.

Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon the actual sale of those investments.

The following table summarizes the valuation of the Fund’s investments by the above fair value hierarchy levels as of April 30, 2024.

Investments, at value

  

Unadjusted
Quoted Prices in
Active Markets
for Identical
Investments
(Level 1)

  

Significant
Other
Observable
Inputs
(Level 2)

  

Significant
Unobservable
Inputs
(Level 3)

  

Balance as of
April 30, 2024

Common Stock:

  

 

    

 

    

 

    

 

  

Basic Materials

  

$

24,044,226

  

$

—

  

$

—

  

$

24,044,226

Communications

  

 

  62,133,979

  

 

            —

  

 

            —

  

 

  62,133,979

Consumer Cyclical

  

 

  35,335,234

  

 

            —

  

 

            —

  

 

  35,335,234

Consumer Non-Cyclical

  

 

  93,955,565

  

 

            —

  

 

            —

  

 

  93,955,565

Financials

  

 

  90,255,348

  

 

            —

  

 

            —

  

 

  90,255,348

Industrials

  

 

  19,512,692

  

 

           —

  

 

            —

  

 

  19,512,692

Technology

  

 

  86,257,380

  

 

            —

  

 

            —

  

 

  86,257,380

Total Investments, at value

  

$

411,494,424

  

$

—

  

$

—

  

$

411,494,424

The accompanying notes are an integral part of these financial statements.

6

    

 

BBH SELECT SERIES – LARGE CAP FUND

STATEMENT OF ASSETS AND LIABILITIES

April 30, 2024 (unaudited)

ASSETS:

  

 

  

Investments in securities, at value (Cost $251,748,056)

  

$

411,494,424

Cash

  

 

26,775,545

Receivables for:

  

 

  

Dividends

  

 

427,077

Shares sold

  

 

120,757

Interest from Custodian

  

 

31,662

Prepaid expenses

  

 

1,902

Total Assets

  

 

438,851,367

LIABILITIES:

  

 

  

Payables for:

  

 

  

Shares redeemed

  

 

447,565

Investment advisory and administrative fees

  

 

237,216

Professional fees

  

 

40,087

Custody and fund accounting fees

  

 

13,769

Transfer agent fees

  

 

2,988

Board of Trustees’ fees

  

 

431

Accrued expenses and other liabilities

  

 

11,133

Total Liabilities

  

 

753,189

NET ASSETS

  

$

438,098,178

Net Assets Consist of:

  

 

  

Paid-in capital

  

$

268,012,392

Retained earnings

  

 

170,085,786

Net Assets

  

$

438,098,178

NET ASSET VALUE AND OFFERING PRICE PER SHARE

  

 

  

CLASS I SHARES

  

 

  

($438,098,178 ÷ 30,062,314 shares outstanding)

  

 

$14.57

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

7

 

BBH SELECT SERIES – LARGE CAP FUND

STATEMENT OF OPERATIONS

For the six months ended April 30, 2024

NET INVESTMENT INCOME:

  

 

  

 

Income:

  

 

  

 

Dividends (net of foreign withholding taxes of $31,536)

  

$

2,111,819

 

Interest income

  

 

98

 

Interest income from Custodian

  

 

331,966

 

Total Income

  

 

2,443,883

 

Expenses:

  

 

  

 

Investment advisory and administrative fees

  

 

1,399,685

 

Board of Trustees’ fees

  

 

40,204

 

Professional fees

  

 

34,614

 

Transfer agent fees

  

 

18,086

 

Custody and fund accounting fees

  

 

12,658

 

Distribution fees

  

 

319

 

Miscellaneous expenses

  

 

32,616

 

Total Expenses

  

 

1,538,182

 

Investment advisory and administrative fee waiver

  

 

(4,935

)

Net Expenses

  

 

1,533,247

 

Net Investment Income

  

 

910,636

 

NET REALIZED AND UNREALIZED GAIN:

  

 

  

 

Net realized gain on investments in securities

  

 

12,122,046

 

Net change in unrealized appreciation/(depreciation) on investments in securities

  

 

51,599,642

 

Net Realized and Unrealized Gain

  

 

63,721,688

 

Net Increase in Net Assets Resulting from Operations

  

$

64,632,324

 

The accompanying notes are an integral part of these financial statements.

8

    

 

BBH SELECT SERIES – LARGE CAP FUND

STATEMENTS OF CHANGES IN NET ASSETS

  
 

For the
six months ended
April 30, 2024
(unaudited)

  

For the
year ended
October 31, 2023

INCREASE/(DECREASE) IN NET ASSETS FROM:

  

  

  

 

  

 

  

 

  

  

  

 

  

 

  

  

Operations:

      

 

  

 

          

 

  

 

    

Net investment income

      

$

910,636

 

          

$

1,206,418

 

    

Net realized gain/(loss) on investments in securities

      

 

12,122,046

 

          

 

(2,691,557

)

    

Net change in unrealized appreciation/(depreciation) on investments in securities

      

 

51,599,642

 

          

 

54,377,097

 

    

Net increase in net assets resulting from operations

      

 

64,632,324

 

          

 

52,891,958

 

    
       

 

  

 

          

 

  

 

    

Dividends and distributions declared:

      

 

  

 

          

 

  

 

    

Class I

      

 

(1,204,965

)

          

 

(5,421,653

)

    

Retail Class1

      

 

—

 

          

 

(10,209

)

    

Total dividends and distributions declared

      

 

(1,204,965

)

          

 

(5,431,862

)

    
       

 

  

 

          

 

  

 

    

Share transactions:

      

 

  

 

          

 

  

 

    

Proceeds from sales of shares2

      

 

22,144,304

 

          

 

32,816,223

 

    

Net asset value of shares issued to shareholders for reinvestment of dividends and distributions

      

 

158,657

 

          

 

778,348

 

    

Proceeds from short-term redemption fees

      

 

—

 

          

 

655

 

    

Cost of shares redeemed2

      

 

(37,734,243

)

          

 

(62,786,493

)

    

Net decrease in net assets resulting from share
transactions

      

 

(15,431,282

)

          

 

(29,191,267

)

    

Total increase in net assets

      

 

47,996,077

 

          

 

18,268,829

 

    
       

 

  

 

          

 

  

 

    

NET ASSETS:

      

 

  

 

          

 

  

 

    

Beginning of period/year

      

 

390,102,101

 

          

 

371,833,272

 

    

End of period/year

      

$

438,098,178

 

          

$

390,102,101

 

    

____________

​1         Effective December 22, 2023, the Fund’s Retail Class was converted to the Fund’s Class I.

​2         Includes share exchanges. See Note 5 in Notes to Financial Statements.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

9

 

BBH SELECT SERIES – LARGE CAP FUND

FINANCIAL HIGHLIGHTS

Selected per share data and ratios for a Class I share outstanding throughout each period/year.
 

For the
six months
ended
April 30, 2024
(unaudited)*




For the years ended October 31,

For the period from
September 9, 2019
(commencement of
operations) to
October 31, 2019

2023

2022

2021

2020

Net asset value, beginning of period/year

  

 

  

$

12.52

 

 

 

$

11.08

 

 

 

$

14.12

 

 

 

$

10.30

 

 

 

$

10.12

 

 

 

$

10.00

 

 

Income from investment operations:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

Net investment income1

      

 

0.03

 

    

 

0.04

 

    

 

0.03

 

    

 

0.04

 

    

 

0.03

 

    

 

0.01

 

  

Net realized and unrealized gain/(loss)

      

 

2.06

 

    

 

1.56

 

    

 

(2.60

)

    

 

3.82

 

    

 

0.15

 

    

 

0.11

 

  

Total income/(loss) from investment operations

      

 

2.09

 

    

 

1.60

 

    

 

(2.57

)

    

 

3.86

 

    

 

0.18

 

    

 

0.12

 

  

Dividends and distributions to shareholders:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

From net investment
income

      

 

(0.04

)

    

 

(0.02

)

    

 

(0.04

)

    

 

(0.04

)

    

 

(0.00

)2

    

 

—

 

  

From net realized gains

      

 

—

 

    

 

(0.14

)

    

 

(0.43

)

    

 

—

 

    

 

—

 

    

 

—

 

  

Total dividends and distributions to shareholders

      

 

(0.04

)

    

 

(0.16

)

    

 

(0.47

)

    

 

(0.04

)

    

 

(0.00

)2

    

 

—

 

  

Short-term redemption fees1

      

 

—

 

    

 

0.002

 

    

 

—

 

    

 

0.002

 

    

 

0.002

 

    

 

—

 

  

Net asset value, end of period/year

      

$

14.57

 

    

$

12.52

 

    

$

11.08

 

    

$

14.12

 

    

$

10.30

 

    

$

10.12

 

  

Total return3

      

 

16.71

%4

    

 

14.63

%

    

 

(18.93

)%

    

 

37.56

%

    

 

1.82

%

    

 

1.20

%4

  

Ratios/Supplemental data:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

Net assets, end of period/year (in millions)

      

$

438

 

    

$

389

 

    

$

371

 

    

$

467

 

    

$

387

 

    

$

397

 

  

Ratio of expenses to average net assets before reductions

      

 

0.71

%5

    

 

0.72

%

    

 

0.71

%

    

 

0.70

%

    

 

0.74

%

    

 

0.75

%6

  

Fee waiver7

      

 

(0.00

)%5,8

    

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

(0.01

)%6

  

Ratio of expenses to average net assets after reductions

      

 

0.71

%5

    

 

0.72

%

    

 

0.71

%

    

 

0.70

%

    

 

0.74

%

    

 

0.74

%6

  

Ratio of net investment income to average net assets

      

 

0.42

%5

    

 

0.31

%

    

 

0.20

%

    

 

0.29

%

    

 

0.34

%

    

 

0.52

%6

  

Portfolio turnover rate

      

 

2

%4

    

 

9

%

    

 

26

%

    

 

18

%

    

 

38

%

    

 

0

%4

  

____________

*    Effective December 22, 2023, the Fund’s Retail Class was converted to the Fund’s Class I.

​1       Calculated using average shares outstanding for the period/year.

​2       Less than $0.01.

The accompanying notes are an integral part of these financial statements.

10

    

 

BBH SELECT SERIES – LARGE CAP FUND

FINANCIAL HIGHLIGHTS (continued)

Selected per share data and ratios for a Class I share outstanding throughout each period/year.

​3       Assumes the reinvestment of distributions.

​4       Not annualized.

​5       Annualized.

​6       Annualized with the exception of audit fees, legal fees and registration fees.

​7       The ratio of expenses to average net assets for the six months ended April 30, 2024, the years ended October 31, 2023, 2022, 2021, 2020 and the period ended October 31, 2019, reflects fees reduced as result of a contractual operating expense limitation of the share class to 0.80%. The Agreement is effective through March 1, 2025 and may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024, the years ended October 31, 2023, 2022, 2021, 2020 and the period from September 9, 2019 to October 31, 2019, the waived fees were $4,935, $0, $0, $0, $0 and $27,976, respectively.

​8       Less than 0.01%.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

11

 

BBH SELECT SERIES – LARGE CAP FUND

NOTES TO FINANCIAL STATEMENTS

April 30, 2024 (unaudited)

1.  Organization. The Fund is a separate, non-diversified series of BBH Trust (the “Trust”), which is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust was originally organized under the laws of the State of Maryland on July 16, 1990 as BBH Fund, Inc. and re-organized as a Delaware statutory trust on June 12, 2007. As of April 30, 2024, there were eight series of the Trust. The Fund commenced operations on September 9, 2019. As of the close of business on December 22, 2023, shares of the Fund’s Retail Class were converted to the Fund’s Class I. The Retail Class ceased operation at this time. The Fund currently offers one class of shares designated as Class I. The investment objective of the Fund is to provide investors with long-term growth of capital. Under normal circumstances, the Fund invests at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in large capitalization publicly traded equity securities, consisting primarily of common stock. The investment objective of the Fund is to provide investors with long-term growth of capital.

2. Significant Accounting Policies. The Fund’s financial statements are prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”). The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 Financial Services – Investment Companies. The following summarizes significant accounting policies of the Fund:

A. Valuation of Investments. The Board of Trustees (the “Board”) has ultimate responsibility for the supervision and oversight of the determination of the fair value of investments. Pursuant to Rule 2a-5 of the 1940 Act, the Board has designated the Investment Adviser as its valuation designee. The Investment Adviser monitors the continual appropriateness of valuation methods applied and determines if adjustments should be made in light of market factor changes and events affecting issuers. The Investment Adviser performs a series of activities to provide reasonable assurance of the appropriateness of the prices utilized, including but not limited to: periodic independent pricing service due diligence meetings and reviewing the results of back testing on a monthly basis. The Investment Adviser provides the Board with reporting on the results of the back testing as well as positions which were fair valued during the period.

All securities and other investments are recorded at their estimated fair value. The value of investments listed on a securities exchange is based on the last sale price prior to the time when assets are valued, or in the absence of recorded sales, at the most recent bid price on such exchange. If a readily available market quotation is not available or is determined to be unreliable, the investments may be valued utilizing evaluated prices provided by independent pricing services. In establishing such prices, the independent pricing service utilizes both dealer supplied prices and electronic data processing techniques which take into account appropriate factors such as institutional sized trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics, the closure of the primary exchange on which securities trade and before the Fund’s net asset value is next determined and other market data without exclusive reliance on quoted exchange prices or over-the-counter prices since such valuations are believed to

12

    

 

BBH SELECT SERIES – LARGE CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

reflect more accurately the fair value of such investments. Investments may be fair valued by Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“SID” or “Investment Adviser”) in accordance with the BBH Trust Portfolio Valuation Policy and Procedures using methods that most fairly reflect the amount that the Fund would reasonably expect to receive for the investment on a current sale in its principal market in the ordinary course of business. Short-term investments, which mature in 60 days or less are valued at amortized cost if their original maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if their original maturity when acquired by the Fund was more than 60 days, unless the use of amortized cost is determined not to represent fair value. Any futures contracts held by the Fund are valued daily at the official settlement price of the exchange on which they are traded.

B. Accounting for Investments and Income. Investment transactions are accounted for on the trade date. Realized gains and losses on investment transactions are determined based on the identified cost method. Dividend income and other distributions received from portfolio securities are recorded on the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of securities received at ex-date. Distributions received on securities that represent a return of capital are recorded as a reduction of cost of investments. Distributions received on securities that represent a capital gain are recorded as a realized gain. Interest income is accrued daily. Investment income is recorded net of any foreign taxes withheld where recovery of such tax is uncertain.

C. Fund Expenses. Most expenses of the Trust can be directly attributed to a specific fund and share class. Expenses which cannot be directly attributed to a fund are generally apportioned among each fund in the Trust and the respective share classes on a net assets basis or other suitable method. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

D. Federal Income Taxes. It is the Trust’s policy to comply with the requirements of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. The Fund files a tax return annually using tax accounting methods required under provisions of the Code, which may differ from GAAP, which is the basis on which these financial statements are prepared. Accordingly, the amount of net investment income and net realized gain reported in these financial statements may differ from that reported on the Fund’s tax return, due to certain book-to-tax timing differences such as losses deferred due to “wash sale” transactions and utilization of capital loss carryforwards. These differences may result in temporary over-distributions for financial statement purposes and are classified as distributions in excess of accumulated net realized gains or net investment income. These distributions do not constitute a return of capital. Permanent differences are reclassified between paid-in capital and retained earnings/(accumulated deficit) within the Statement of Assets and Liabilities based upon their tax classification. As such, the character of distributions to shareholders reported in the Financial Highlights table may differ from that reported to shareholders on Form 1099-DIV.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

13

 

BBH SELECT SERIES – LARGE CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

The Fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (“ASC 740”). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The Fund did not have any unrecognized tax benefits as of April 30, 2024, nor were there any increases or decreases in unrecognized tax benefits for the year then ended. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits as an income tax expense in the Statement of Operations. During the six months ended April 30, 2024, the Fund did not incur any such interest or penalties. The Fund is subject to examination by U.S. federal and state tax authorities for returns filed for open tax period since September 9, 2019 (commencement of operations). The Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

E. Dividends and Distributions to Shareholders. Dividends and distributions from net investment income to shareholders, if any, are paid annually and are recorded on the ex-dividend date. Distributions from net capital gains, if any, are generally declared and paid annually and are recorded on the ex-dividend date. The Fund declared dividends and distributions in the amount of $1,204,965 and $0 to Class I and Retail Class shareholders, respectively, during the six months ended April 30, 2024, respectively.

The tax character of distributions paid during the years ended October 31, 2023 and 2022, respectively, were as follows:

 

Distributions paid from:
   

Ordinary
income

  

Net
long-term
capital gain

  

Total
taxable
distributions

  

Tax return
of capital

  

Total
distributions
paid

2023:

  

$       829,034

  

$    4,602,828

  

$    5,431,862

  

$        —

  

$    5,431,862

2022:

  

       1,201,040

  

    14,318,394

  

    15,519,434

  

          —

  

    15,519,434

As of October 31, 2023 and 2022, respectively, the components of retained earnings/(accumulated deficit) on tax basis were as follows:

 

Components of retained earnings/(accumulated deficit):
   

Undistributed
ordinary
income

  

Undistributed
long-term
capital gain

  

Accumulated
capital and
other losses

  

Other
book/tax
temporary
differences

  

Unrealized
appreciation/
(depreciation)

  

Total
retained
earnings/
(accumulated
deficit)

2023:

  

$1,203,717

  

$            —

  

$ (2,691,557)

  

$  (458)

  

$  108,146,725

  

$ 106,658,427

2022:

  

     826,333

  

   4,602,828

  

             —

  

    (458)

  

      53,769,628

  

     59,198,331

The Fund had $2,691,557 net capital loss carryforwards as of October 31, 2023, of which $2,691,557 and $0, is attributable to short-term and long-term capital losses, respectively.

The Fund is permitted to carryforward capital losses for an unlimited period and they will retain their character as either short-term or long-term capital losses.

14

    

 

BBH SELECT SERIES – LARGE CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

Total distributions paid may differ from amounts reported in the Statements of Changes in Net Assets because, for tax purposes, dividends are recognized when actually paid.

The differences between book-basis and tax-basis unrealized appreciation/(depreciation) would be attributable primarily to the tax deferral of losses on wash sales, if applicable.

To the extent future capital gains are offset by capital loss carryforwards, if any, such gains will not be distributed.

F. Use of Estimates. The preparation of the financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increase and decrease in net assets from operations during the reporting period. Actual results could differ from these estimates.

3.  Fees and Other Transactions with Affiliates.

A. Investment Advisory and Administrative Fees. Under a combined Investment Advisory and Administrative Services Agreement (“Agreement”) with the Trust, Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“Investment Adviser”) provides investment advisory, portfolio management and administrative services to the Fund. The Fund pays a combined fee for investment advisory and administrative services calculated daily and paid monthly at an annual rate equivalent to 0.65% per annum on the first $3 billion of the Fund’s average daily net assets and 0.60% per annum on the Fund’s average daily net assets over $3 billion. For the six months ended April 30, 2024, the Fund incurred $1,399,685 under the Agreement.

B. Investment Advisory and Administrative Fee Waivers. Effective September 9, 2019 (commencement of operations), the Investment Adviser contractually agreed to limit the annual fund operating expenses (excluding interest, taxes, brokerage commissions, other expenditures that are capitalized in accordance with GAAP, other extraordinary expenses not incurred in the ordinary course of the Fund’s business and for Retail Class, amounts payable pursuant to any plan adopted in accordance with Rule 12b-1) of Class I and Retail Class to 0.80%. The agreement will terminate on March 1, 2025, unless it is renewed by all parties to the agreement. The agreement may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024, the Investment Adviser waived fees in the amount of $4,935 for Class I and from November 1, 2023 to December 21, 2023 (last day of operation of Retail Class), the Investment Adviser waived fees in the amount of $0 for Retail Class.

C. Distribution (12b-1) Fees. During the period from September 9, 2019 (commencement of operations) through December 21, 2023 (last day of operation of Retail Class), the Fund adopted a distribution plan pursuant to Rule 12b-1 for Retail Class shares that allows the Fund to pay distribution and other fees for the sale of its shares and for distribution-related services provided to shareholders. Because these fees are paid out of the Fund’s assets continuously, over time these fees will increase the cost

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

15

 

BBH SELECT SERIES – LARGE CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

of investment in Retail Class shares and may cost the Retail Class shareholder more than paying other types of sales charges. The maximum annual distribution fee for Retail Class shares was 0.25% of the average daily net assets of the Retail Class shares of the Fund. With this agreement along with the investment advisory and waiver agreements above, it was anticipated that total operating expenses for Retail Class shares were no greater than 1.05% of the average daily net assets. For the period from November 1, 2023 through December 21, 2023, Retail Class shares of the Fund incurred $319 for Distribution (12b-1) Fees. This amount is presented under line item “Distribution fees” in the Statement of Operations.

D. Custody and Fund Accounting Fees. BBH acts as a custodian and fund accountant and receives custody and fund accounting fees from the Fund calculated daily and paid monthly. BBH holds all of the Fund’s cash and investments and calculates the Fund’s daily net asset value. The custody fee is based partially on asset values and partially on individual fund transactions. The fund accounting fee is primarily an asset-based fee calculated at 0.325 basis points per annum of the Fund’s net asset value. For the six months ended April 30, 2024, the Fund incurred $12,658 in custody and fund accounting fees. As per agreement with the Fund’s custodian, the Fund receives interest income on cash balances held by the custodian at the BBH Base Rate. The BBH Base Rate is defined as BBH’s effective trading rate in local money markets on each day. The total interest earned by the Fund for the six months ended April 30, 2024 was $331,966. This amount is included in “Interest income from Custodian” in the Statement of Operations. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to their agreement, the Fund will pay the BBH Overdraft Base Rate plus 2% on the day of the overdraft. The Fund did not incur any such fees during the six months ended April 30, 2024. This amount, if any, is included under line item “Custody and fund accounting fees” in the Statement of Operations.

E. Board of Trustees’ Fees. Each Trustee who is not an “interested person” as defined under the 1940 Act receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the six months ended April 30, 2024, the Fund incurred $40,204 in independent Trustee compensation and expense reimbursements.

F. Officers of the Trust. Officers of the Trust are also employees of BBH. Officers are paid no fees by the Trust for their services to the Trust.

4.  Investment Transactions. For the six months ended April 30, 2024, the cost of purchases and the proceeds of sales of investment securities, other than short-term investments, were $9,086,152 and $29,831,573, respectively.

16

    

 

BBH SELECT SERIES – LARGE CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

5.  Shares of Beneficial Interest. The Trust is permitted to issue an unlimited number of Class I and Retail Class shares of beneficial interest at no par value. Effective December 22, 2023, the Fund’s Retail Class was converted to the Fund’s Class I. Transactions in Class I and Retail Class shares were as follows:

 

For the six months ended
April 30, 2024 (unaudited)

  

For the year ended
October 31, 2023
   

Shares

  

Dollars

  

Shares

  

Dollars

Class I

    

 

    

 

    

 

  

 

  

 

Shares sold

  

1,549,851

 

  

$  22,142,404

 

  

2,715,842

 

  

 

$  32,782,805

 

Shares issued in connection with reinvestments of dividends

  

11,589

 

  

158,657

 

  

67,204

 

  

 

768,139

 

Proceeds from short-term redemption fees

  

N/A

 

  

N/A

 

  

N/A

 

  

 

655

 

Shares redeemed

  

(2,591,869

)

  

(36,766,651

)

  

(5,163,596

)

  

 

(62,702,974

)

Net decrease

  

(1,030,429

)

  

$ (14,465,590

)

  

(2,380,550

)

  

 

$ (29,151,375

)

Retail Class

    

 

    

 

    

 

  

 

  

 

Shares sold

  

140

 

  

$          1,900

 

  

2,603

 

  

 

$         33,418

 

Shares issued in connection with reinvestments of dividends

  

N/A

 

  

N/A

 

  

904

 

  

 

10,209

 

Shares redeemed

  

(70,792

)

  

(967,592

)

  

(6,729

)

  

 

(83,519

)

Net decrease

  

(70,652

)

  

$      (965,692

)

  

(3,222

)

  

$

        (39,892

)

Included in Shares Sold and Shares Redeemed are shareholder exchanges during the six months ended April 30, 2024 and the year ended October 31, 2023. Specifically:

During the six months ended April 30, 2024, 69,150 shares of Retail Class were exchanged for 68,499 shares of Class I valued at $946,662.

During the year ended October 31, 2023, there were no exchanges between Class I and Retail Class.

6.  Principal Risk Factors and Indemnifications.

A. Principal Risk Factors. Investing in the Fund may involve certain risks, as discussed in the Fund’s prospectus, including but not limited to, those described below:

A shareholder may lose money by investing in the Fund (investment risk). The Fund is actively managed and the decisions by the Investment Adviser may cause the Fund to incur losses or miss profit opportunities (management risk). Price movements may occur due to factors affecting individual companies, such as the issuance of an unfavorable earnings report, or other events affecting particular industries or the equity market as a whole (equity securities risk). The value of securities held by the Fund may fall due to changing economic, political, regulatory or market conditions, or due to a company’s or issuer’s individual situation. Natural disasters, the spread of

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

17

 

BBH SELECT SERIES – LARGE CAP FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

infectious illness and other public health emergencies, recession, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse effects on world economies and markets generally (market risk). In the normal course of business, the Fund invests in securities and enters into transactions where risks exist due to assumption of large positions in securities of a small number of issuers (non-diversification risk). There are certain risks associated with investing in non-U.S. securities not present in domestic investments, including, but not limited to, recovery of tax withheld by foreign jurisdictions (non-U.S. investment risk). The Fund’s shareholders may be adversely impacted by asset allocation decisions made by an investment adviser whose discretionary clients make up a large percentage of the Fund’s shareholders (large shareholder risk). The Fund invests in large cap company securities, which may underperform other funds during periods when the Fund’s large cap securities are out of favor (large cap company risk). Preferred securities are subject to issuer and market risks applicable generally to equity securities. In addition, a company’s preferred securities may pay dividends only after the company makes required payments on bonds and other debt. If a company experiences actual or perceived changes in its financial condition or prospects, the value of preferred securities may be more greatly affected than the value of bonds and other debt (preferred security risk). The extent of the Fund’s exposure to these risks in respect to these financial assets is included in their value as recorded in the Fund’s Statement of Assets and Liabilities.

Please refer to the Fund’s prospectus for a complete description of the principal risks of investing in the Fund.

B. Indemnifications. Under the Trust’s organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the Fund, and shareholders are indemnified against personal liability for the obligations of the Trust. Additionally, in the normal course of business, the Fund enters into agreements with service providers that may contain indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss from such claims is considered remote.

7.  Subsequent Events. Management has evaluated events and transactions that have occurred since April 30, 2024 through the date the financial statements were issued and determined that there were no subsequent events that would require recognition or additional disclosure in the financial statements.

18

    

 

BBH SELECT SERIES – LARGE CAP FUND

DISCLOSURE OF FUND EXPENSES

April 30, 2024 (unaudited)

EXAMPLE

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested distributions, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (November 1, 2023 to April 30, 2024).

ACTUAL EXPENSES

The first line of the table below provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during the period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% Hypothetical Example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

19

 

BBH SELECT SERIES – LARGE CAP FUND

DISCLOSURE OF FUND EXPENSES (continued)

April 30, 2024 (unaudited)

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

Beginning
Account Value
November 1, 2023

  

Ending
Account Value
April 30, 2024

  

Expenses Paid
During Period
November 1, 2023 to
April 30, 20241

Class I

            

Actual

  

$1,000

  

$1,167

  

$3.83

Hypothetical2

  

$1,000

  

$1,021

  

$3.57

____________

​1   Expenses are equal to the Fund’s annualized net expense ratio of 0.71% for Class I shares, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period).

​2   Assumes a return of 5% before expenses. For the purposes of the calculation, the applicable annualized expense ratio for each class of shares is subtracted from the assumed return before expenses.

20

    

 

BBH SELECT SERIES – LARGE CAP FUND

DISCLOSURE OF ADVISOR SELECTION

April 30, 2024 (unaudited)

Investment Advisory and Administrative Services Agreement Approval

The 1940 Act requires that a fund’s investment advisory agreements must be approved both by a fund’s board of trustees and by a majority of the trustees who are not parties to the investment advisory agreements or “interested persons” of any party (“Independent Trustees”), cast in person at a meeting called for the purpose of voting on such approval.

The Board, a majority of which is comprised of Independent Trustees, held a telephonic meeting on November 16, 2023 and an in-person meeting on December 12, 2023, to consider whether to renew the combined Amended and Restated Investment Advisory and Administrative Services Agreement (the “Advisory Agreement”) between the Trust and the Investment Adviser with respect to the existing funds in the Trust, including the Fund. At the December 12, 2023 meeting, the Board voted to approve the renewal of the Agreement with respect to the Fund for an additional one-year term. In doing so, the Board determined that the terms of the Agreement were fair and reasonable and in the best interest of the Fund and its shareholders and that it had received sufficient information throughout the year to make an informed business decision with respect to the continuation of the Agreement.

Both in the meetings specifically held to address the continuance of the Agreement and at other meetings over the course of the year, the Board requested, received and assessed a variety of materials provided by the Investment Adviser and BBH, including, among other things, information about the nature, extent and quality of the services provided to the Trust and the Fund by the Investment Adviser and BBH, including investment management and administrative, the oversight of Fund service providers, marketing, risk oversight, compliance, and the ability to meet applicable legal and regulatory requirements. The Board also received and reviewed third-party comparative fee and expense information for the Fund prepared by Broadridge Financial Solutions, Inc. (“Broadridge”) using data from Lipper Inc., an independent provider of investment company data (“Lipper Report”). The Board reviewed this report with Broadridge, counsel to the Trust (“Fund Counsel”) and BBH. The Board received from, and discussed with, Fund Counsel a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements under the 1940 Act, as well as the guidance provided in Gartenberg v. Merrill Lynch Asset Management, Inc., which was affirmed in Jones v. Harris Associates, L.P. In addition, the Board met in executive session outside the presence of Fund management.

In approving the continuation of the Agreement, the Board considered: (a) the nature, extent and quality of services provided by the Investment Adviser; (b) the investment performance of the Fund; (c) the advisory fee and the cost of the services and profits to be realized by the Investment Adviser from its relationship with the Fund; (d) the Fund’s costs to investors compared to the costs of comparative funds; (e) the sharing of potential economies of scale; (f) fall-out benefits to the Investment Adviser as a result of its relationship with the Fund; and (g) other factors deemed relevant by the Board. The following is a summary of certain factors the Board considered in making its determination to approve the continuance of the Agreement. No single factor reviewed by the Board was identified as the principal factor in determining whether to approve the Agreement, and individual Trustees may have given different weight to various factors. The Board reviewed these factors with Fund Counsel. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the expense information, the cost of the services provided, and the profits realized by the Investment Adviser.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

21

 

BBH SELECT SERIES – LARGE CAP FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Nature, Extent and Quality of Services

The Board noted that, under the Agreement and with respect to the Fund, the Investment Adviser, subject to the supervision of the Board, is responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Fund’s investment objective and policies. The Board further noted that, as a combined investment advisory and administration agreement, the Agreement also contemplates the provision of administrative services by the Investment Adviser to the Fund within the same fee structure.

The Board received and considered information during the December 12, 2023 meeting, and over the course of the previous year, regarding the nature, extent and quality of services provided to the Trust and the Fund by the Investment Adviser including: portfolio management, the supervision of operations and compliance, preparation of regulatory filings, disclosures to Fund shareholders, general oversight of service providers, organizing Board meetings and preparing the materials for such Board meetings, assistance to the Board (including the Independent Trustees in their capacity as Trustees), legal and Chief Compliance Officer services for the Trust, and other services necessary for the operation of the Fund.

The Board considered the resources of the Investment Adviser and BBH, as a whole, dedicated to the Fund noting that, pursuant to separate agreements, BBH also provides custody and fund accounting services to the Fund. The Board considered the depth and range of services provided pursuant to the Agreement, noting that the Investment Adviser also coordinates the provision of services to the Fund by affiliated and nonaffiliated service providers.

The Board considered the scope and quality of services provided by the Investment Adviser under the Agreement. The Board reviewed the qualifications of the key investment personnel primarily responsible for the day-to-day portfolio management of the Fund. The Board also considered the policies and practices followed by BBH and the Investment Adviser. The Board noted that during the course of its regular meetings, it received reports on each of the foregoing topics. The Board concluded that, overall, it was satisfied with the nature, extent and quality of the investment advisory and administrative services provided, and expected to be provided, to the Fund pursuant to the Agreement.

Fund Performance

At the November 16, 2023 and December 12, 2023 meetings, and throughout the year, the Board received and considered performance information for the Fund provided by BBH. The Board also considered the Fund’s performance relative to a peer category of other mutual funds in a report compiled by Broadridge. As part of this review, the Trustees considered the composition of the peer category, selection criteria and reputation of Broadridge who prepared the peer category analysis. The Board reviewed and discussed with both BBH and Broadridge the report’s findings and discussed the positioning of the Fund relative to its selected peer category. The Board considered investment performance for the Fund over the 1-, 2-, 3- and 4-year periods of time, noting the Fund had above average performance in the 1- and 2- year periods, average performance in the 3- year period and below average performance in the 4-year period, each ended September 30, 2023. In evaluating the performance of the Fund, the Board considered the risk expectations for the Fund as well as the level of Fund performance in the context of Fund expenses and the Investment Adviser’s profitability. The Board also noted relevant market conditions for the Fund after September 30, 2023. Based on this information, the Board concluded that it was satisfied with the Fund’s investment results.

22

    

 

BBH SELECT SERIES – LARGE CAP FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Costs of Services Provided and Profitability

The Board considered the fee rates paid by the Fund to the Investment Adviser and BBH in light of the nature, extent and quality of the services provided to the Fund. The Board also considered and reviewed the fee waiver arrangement that was in place for the Fund and considered the actual fee rates after taking into account the contractual fee waiver. The Board noted that they had previously received and considered information comparing the Fund’s combined investment advisory and administration fee and the Fund’s net operating expenses with those of other comparable mutual funds, such peer category and comparisons having been selected and calculated by Broadridge. The Board recognized that it is difficult to make comparisons of the fee rate, or of combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds. The Board concluded that the advisory and administration fee appeared to be both reasonable in light of the services rendered and the result of arm’s length negotiations.

With regard to profitability, the Trustees considered the compensation and benefits flowing to the Investment Adviser and BBH, directly or indirectly. The Board reviewed profitability data for the Fund using data from October 1, 2022 through September 30, 2023, for both the Investment Adviser and BBH. The data also included the effect of revenue generated by the custody and fund accounting fees paid by the Fund to BBH and corresponding expenses. The Board conducted a detailed review of the expense allocation methods used in preparing the profitability data. The Board focused on profitability of the Investment Adviser and BBH’s relationships with the Fund before taxes and distribution expenses. The Board concluded that the Investment Adviser’s and BBH’s profitability was not excessive in light of the nature, extent and quality of services provided to the Fund.

The Board also considered the effect of fall-out benefits to the Investment Adviser and BBH such as the increased visibility of BBH’s investment management business due to the distribution of the Trust’s funds. The Board considered other benefits received by BBH and the Investment Adviser as a result of their relationships with the Fund. These other benefits include fees received for being the Fund’s administrator, custodian, fund accounting agent. In light of the costs of providing services pursuant to the Agreement as well as the Investment Adviser and BBH’s commitment to the Fund, the ancillary benefits that the Investment Adviser and BBH received were considered reasonable.

Economies of Scale

The Board also considered the existence of any economies of scale and whether those economies are passed along to the Fund’s shareholders through a graduated investment advisory fee schedule or other means, including any fee waivers by the Investment Adviser and BBH. The Board considered the fee schedule for the Fund on the information they had been provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Fund, there appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints apply. In light of the Fund’s current size and expense structure, the Board concluded that the current breakpoints for the Fund were reasonable. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the comparative expense information, the cost of the services provided by the Investment Adviser.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

23

 

BBH SELECT SERIES – LARGE CAP FUND

CONFLICTS OF INTEREST

April 30, 2024 (unaudited)

BBH&Co., including the Investment Adviser, provides discretionary and non-discretionary investment management services and products to corporations, institutions and individual investors throughout the world. As a result, in the ordinary course of its businesses, BBH&Co., including the Investment Adviser, may engage in activities in which its interests or the interests of its clients may conflict with or be adverse to the interests of the Funds. In addition, certain of such clients (including the Funds) utilize the services of BBH&Co. for which they will pay to BBH&Co. customary fees and expenses that will not be shared with the Funds.

The Investment Adviser and the Sub-advisers have adopted and implemented policies and procedures that seek to manage conflicts of interest. Pursuant to such policies and procedures, the Investment Adviser and each Sub-adviser monitor a variety of areas, including compliance with fund investment guidelines, the investment in only those securities that have been approved for purchase, and compliance with their respective Code of Ethics.

The Trust also manages these conflicts of interest. For example, the Trust has designated a CCO and has adopted and implemented policies and procedures designed to manage the conflicts identified below and other conflicts that may arise in the course of the Funds’ operations in such a way as to safeguard the Funds from being negatively affected as a result of any such potential conflicts. From time to time, the Trustees receive reports from the Investment Adviser, the Sub-advisers and the Trust’s CCO on areas of potential conflict.

Investors should carefully review the following, which describes potential and actual conflicts of interest that BBH&Co., the Investment Adviser and Sub-advisers can face in the operation of their respective investment management services. This section is not, and is not intended to be, a complete enumeration or explanation of all of the potential conflicts of interest that may arise. The Investment Adviser, the Sub-advisers and the Funds has adopted policies and procedures reasonably designed to appropriately prevent, limit or mitigate the conflicts of interest described below. Additional information about potential conflicts of interest regarding the Investment Adviser is set forth in the Investment Adviser’s Form ADV. A copy of Part 1 and Part 2A of the Investment Adviser’s Form ADV is available on the SEC’s website (www.adviserinfo.sec.gov). In addition, many of the activities that create these conflicts of interest are limited and/or prohibited by law, unless an exception is available.

Other Clients and Allocation of Investment Opportunities. BBH&Co., the Investment Adviser, and the Sub-advisers manage funds and accounts of clients other than the Funds (“Other Clients”). In general, BBH&Co., the Investment Adviser, and the Sub-advisers face conflicts of interest when they render investment advisory services to different clients and, from time to time, provide dissimilar investment advice to different clients. Investment decisions will not necessarily be made in parallel among the Funds and Other Clients. Investments made by the Funds do not, and are not intended to, replicate the investments, or the investment methods and strategies, of Other Clients. Accordingly, such Other Clients may produce results that are materially different from those experienced by the Funds. Certain other conflicts of interest may arise in connection with a portfolio manager’s management of the Funds’ investments, on the one hand, and the investments of other funds or accounts for which the portfolio

  

24

    

 

BBH SELECT SERIES – LARGE CAP FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

manager is responsible, on the other. For example, it is possible that the various funds or accounts managed by the Investment Adviser or Sub-advisers could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Funds. From time to time, the Investment Adviser and Sub-advisers, sponsor and with other investment pools and accounts which engage in the same or similar businesses as the Funds using the same or similar investment strategies. To the extent that the same investment opportunities might be desirable for more than one account or fund, possible conflicts could arise in determining how to allocate them because the Investment Adviser or Sub-advisers may have an incentive to allocate investment opportunities to certain accounts or funds. However, BBH&Co. and the Investment Adviser have implemented policies and procedures designed to ensure that information relevant to investment decisions is disseminated promptly within its portfolio management teams and investment opportunities are allocated equitably among different clients. The policies and procedures require, among other things, objective allocation for limited investment opportunities, and documentation and review of justifications for any decisions to make investments only for select accounts or in a manner disproportionate to the size of the account. Nevertheless, access to investment opportunities may be allocated differently among accounts due to the particular characteristics of an account, such as size of the account, cash position, tax status, risk tolerance and investment restrictions or for other reasons.

Actual or potential conflicts of interest may also arise when a portfolio manager has management responsibilities to multiple accounts or funds, resulting in unequal commitment of time and attention to the portfolio management of the funds or accounts.

Affiliated Service Providers. Other potential conflicts might include conflicts between the Funds and its affiliated and unaffiliated service providers (e.g., conflicting duties of loyalty). In addition to providing investment management services through the SID, BBH&Co. provides administrative, custody, shareholder servicing and fund accounting services to the Funds. BBH&Co. may have conflicting duties of loyalty while servicing the Funds and/or opportunities to further its own interest to the detriment of the Funds. For example, in negotiating fee arrangements with affiliated service providers, BBH&Co. may have an incentive to agree to higher fees than it would in the case of unaffiliated providers. BBH&Co. acting in its capacity as the Funds’ administrator is the primary valuation agent of the Funds. BBH&Co. values securities and assets in the Funds according to the Funds’ valuation policies. Because the Investment Adviser’s advisory and administrative fees are calculated by reference to a Funds’ net assets, BBH&Co. and its affiliates may have an incentive to seek to overvalue certain assets.

Aggregation. Potential conflicts of interest also arise with the aggregation of trade orders. Purchases and sales of securities for the Funds may be aggregated with orders for other client accounts managed by the Sub-advisers. The Sub-advisers, however, are not required to aggregate orders if portfolio management decisions for different accounts are made separately, or if it is determined that aggregating is not practicable, or in cases involving client direction. Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds will be charged or credited with the

  

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

25

 

BBH SELECT SERIES – LARGE CAP FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

average price. Thus, the effect of the aggregation may operate on some occasions to the disadvantage of the Funds. In addition, under certain circumstances, the Funds will not be charged the same commission or commission equivalent rates in connection with an aggregated order.

Cross Trades. Under certain circumstances, the Investment Adviser, on behalf of the Funds, may seek to buy from or sell securities to another fund or account advised by BBH, the Investment Adviser. Subject to applicable law and regulation, BBH&Co., the Investment Adviser may (but is not required to) effect purchases and sales between BBH&Co., the Investment Adviser clients (“cross trades”), including the Funds, if BBH&Co., the Investment Adviser or a Fund’s Sub-adviser believes such transactions are appropriate based on each party’s investment objectives and guidelines. There may be potential conflicts of interest or regulatory issues relating to these transactions which could limit the Investment Adviser’s decision to engage in these transactions for the Funds. BBH&Co., the Investment Adviser and/or a Fund’s Sub-adviser may have a potentially conflicting division of loyalties and responsibilities to the parties in such transactions.

Soft Dollars. The Investment Adviser may direct brokerage transactions and/or payment of a portion of client commissions (“soft dollars”) to specific brokers or dealers or other providers to pay for research or other appropriate services which provide, in the Investment Adviser’s view, appropriate assistance in the investment decision-making process (including with respect to futures, fixed price offerings and over-the-counter transactions). The use of a broker that provides research and securities transaction services may result in a higher commission than that offered by a broker who does not provide such services. The Investment Adviser will determine in good faith whether the amount of commission is reasonable in relation to the value of research and services provided and whether the services provide lawful and appropriate assistance in its investment decision-making responsibilities.

Research or other services obtained in this manner may be used in servicing any or all of the Funds and other accounts managed by the Investment Adviser, including in connection with accounts that do not pay commissions to the broker related to the research or other service arrangements. Such products and services may disproportionately benefit other client accounts relative to the Funds based on the amount of brokerage commissions paid by the Funds and such other accounts. To the extent that a Sub-adviser uses soft dollars, it will not have to pay for those products and services itself.

BBH&Co. may receive research that is bundled with the trade execution, clearing, and/or settlement services provided by a particular broker-dealer. To the extent that a Sub-adviser receives research on this basis, many of the same conflicts related to traditional soft dollars may exist. For example, the research effectively will be paid by client commissions that also will be used to pay for the execution, clearing, and settlement services provided by the broker-dealer and will not be paid by the Sub-adviser.

Arrangements regarding compensation and delegation of responsibility may create conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades, administration of investment advice and valuation of securities.

  

26

    

 

BBH SELECT SERIES – LARGE CAP FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Investments in BBH Funds. From time to time BBH&Co. may invest a portion of the assets of its discretionary investment advisory clients in the Funds. That investment by BBH&Co. on behalf of its discretionary investment advisory clients in the Funds may be significant at times.

Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of scale that tend to reduce the Funds’ expense ratio. In selecting the Funds for its discretionary investment advisory clients, BBH&Co. may limit its selection to funds managed by BBH&Co. or the Investment Adviser. BBH&Co. may not consider or canvass the universe of unaffiliated investment companies available, even though there may be unaffiliated investment companies that may be more appropriate or that have superior performance. BBH&Co., the Investment Adviser and their affiliates providing services to the Funds benefit from additional fees when the Funds is included as an investment by a discretionary investment advisory client.

BBH&Co. reserves the right to redeem at any time some or all of the shares of the Funds acquired for its discretionary investment advisory clients’ accounts. A large redemption of shares of the Funds by BBH&Co. on behalf of its discretionary investment advisory clients could significantly reduce the asset size of the Funds, which might have an adverse effect on the Funds’ investment flexibility, portfolio diversification and expense ratio.

Valuation. When market quotations are not readily available or are believed by BBH&Co. to be unreliable, the Funds’ investments will be valued at fair value by BBH&Co. pursuant to procedures adopted by the Funds’ Board. When determining an asset’s “fair value,” BBH&Co. seeks to determine the price that a Fund might reasonably expect to receive from the current sale of that asset in an arm’s-length transaction. The price generally may not be determined based on what the Funds might reasonably expect to receive for selling an asset at a later time or if it holds the asset to maturity. While fair value determinations will be based upon all available factors that BBH&Co. deems relevant at the time of the determination and may be based on analytical values determined by BBH&Co. using proprietary or third-party valuation models, fair value represents only a good faith approximation of the value of a security. The fair value of one or more securities may not, in retrospect, be the price at which those assets could have been sold during the period in which the particular fair values were used in determining the Funds’ net asset value. As a result, the Funds’ sale or redemption of its shares at net asset value, at a time when a holding or holdings are valued by BBH&Co. (pursuant to Board-adopted procedures) at fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.

Referral Arrangements. BBH&Co. may enter into advisory and/or referral arrangements with third parties. Such arrangements may include compensation paid by BBH&Co. to the third party. BBH&Co. may pay a solicitation fee for referrals and/or advisory or incentive fees. BBH&Co. may benefit from increased amounts of assets under management.

Personal Trading. BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, face conflicts of interest when transacting in securities for their own accounts because they could benefit by trading in the same securities as the Funds, which could have an adverse effect on the Funds. However, the Investment Adviser has

  

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

27

 

BBH SELECT SERIES – LARGE CAP FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policy and procedures are intended to prevent BBH&Co. Partners and employees from trading in the same securities as the Funds. However, BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policies and procedures are intended to prevent BBH&Co. Partners and employees with access to Fund material non-public information from trading in the same securities as the Funds.

Gifts and Entertainment. From time to time, employees of BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, may receive gifts and/or entertainment from clients, intermediaries, or service providers to the Funds or BBH&Co., including the Investment Adviser, which could have the appearance of affecting or may potentially affect the judgment of the employees, or the manner in which they conduct business. The Investment Adviser has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees. BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees.

  

28

    

 

BBH SELECT SERIES – LARGE CAP FUND

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM

April 30, 2024 (unaudited)

The Securities and Exchange Commission adopted Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), to promote effective liquidity risk management throughout the open-end investment company industry in order to reduce the risk that funds will be unable to meet their redemption obligations and mitigate dilution of the interests of fund shareholders.

The Board of Trustees (the “Board”) of BBH Trust has appointed three members of the Brown Brothers Harriman & Co. Mutual Fund Advisory Department, the Investment Adviser to the funds of BBH Trust (the “Funds”), as the Program Administrator for each Fund’s liquidity risk management program (the “Program”). The Board met on March 6, 2024 to review the Program for the Funds pursuant to the Liquidity Rule. The Program Administrator provided the Board with a report (the “Report”) that addressed the operations of the Program and assessed its adequacy and effectiveness for the period from February 1, 2023 through January 31, 2024 (the “Reporting Period”).

The Report noted that the Program complied with the key factors for consideration under the Liquidity Rule for assessing, managing and periodically reviewing a Fund’s liquidity risk, including the following points.

Liquidity classification. The Report described the Program’s liquidity classification methodology for categorizing the Funds’ investments into one of four liquidity buckets. The Funds classified each of their investments into one of four liquidity categories based on the number of days reasonably needed to sell and convert a reasonably anticipated sized trade of each investment into cash without significantly impacting the price of the investments. The Program Administrator relied on a third-party data provider to facilitate the classification of each Fund’s investments based on criteria in each Fund’s Program. During the Reporting Period, no Fund held more than 15% of its net assets in illiquid investments.

Highly Liquid Investment Minimum. The Report noted that one aspect of the Liquidity Rule is a requirement that funds that are expected to have less than 50% of assets classified as other than “highly liquid” should establish a minimum percentage of highly liquid assets that the fund is expected to hold on an on-going basis. The Program Administrator monitors the percentages of assets in each category on an ongoing basis and, given that no Fund has approached the 50% threshold, has made the determination that it is not necessary to assign a Highly Liquid Investment Minimum to any of the Funds as provided for in the Liquidity Rule.

The Fund’s investment strategy and liquidity of portfolio investments during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed whether each Fund’s investment strategy is appropriate for an open-end fund structure with a focus on Funds with more significant and consistent holdings of less liquid and illiquid assets and factored a Fund’s concentration in an issuer into the liquidity classification methodology by taking issuer position sizes into account.

Short-term and long-term cash flow projections during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed historical redemption activity and used this information as a component to establish each Fund’s reasonably

  

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

29

 

BBH SELECT SERIES – LARGE CAP FUND

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM

(continued)

April 30, 2024 (unaudited)

anticipated trading size. The Program Administrator also took into consideration other factors such as shareholder ownership concentration, applicable distribution channels and the degree of certainty associated with a Fund’s short-term and long-term cash flow projections.

Holdings of cash and cash equivalents. The Program Administrator considered the degree to which each Fund held cash and cash equivalents as a component of each Fund’s ability to meet redemption requests.

There were no material changes to the Program during the Reporting Period. The Program Administrator has informed the Board that it believes that the Fund’s Program is adequately designed, has been implemented as intended, and has operated effectively since its implementation. No material exceptions have been noted since the implementation of the Program, and there were no liquidity events that impacted the Fund or its ability to meet redemption requests on a timely basis during the Reporting Period.

30

    

 

Administrator
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005

Distributor
Alps Distributors, Inc.
1290 Broadway, Suite 1000
Denver, Co 80203

Shareholder Servicing Agent
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005
1-800-575-1265

To obtain information or make shareholder inquiries:

  

Investment Adviser
Brown Brothers Harriman
Mutual Fund Advisory Department
140 Broadway
New York, NY 10005

By telephone:
By E-mail send your request to:
On the internet:

  

Call 1-800-575-1265
bbhfunds@bbh.com
www.bbhfunds.com

This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund.

For more complete information, visit www.bbhfunds.com for a prospectus. You should consider the Fund’s investment objectives, risks, charges and expenses carefully before you invest. Information about these and other important subjects is in the Fund’s prospectus, which you should read carefully before investing.

Holdings and allocations are subject to change. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities. Current and future holdings are subject to risk.

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Forms N-PORT are available electronically on the SEC’s website (sec.gov). For a complete list of a fund’s portfolio holdings, view the most recent holdings listing, semi-annual report, or annual report on the Fund’s web site at http://www.bbhfunds.com.

A summary of the Fund’s Proxy Voting Policy that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund’s portfolio, as well as a record of how the Fund voted any such proxies during the most recent 12-month period ended June 30, is available, without charge, upon request by calling the toll-free number listed above. This information is also available on the SEC’s website at www.sec.gov.

NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE

 

   

Semi-Annual Report

APRIL 30, 2024

BBH Intermediate Municipal Bond Fund

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO ALLOCATION

April 30, 2024 (unaudited)

BREAKDOWN BY SECURITY TYPE

 

U.S. $ Value

  

Percent of
Net Assets

Municipal Bonds

  

$

1,011,852,444

 

  

103.9

%

Short-term Municipal Bonds

  

 

            1,470,401

 

  

0.2

 

Liabilities in Excess of Cash and Other Assets

  

 

        (39,803,275

)

  

(4.1

)

NET ASSETS

  

$

   973,519,570

 

  

100.0

%

All data as of April 30, 2024. The BBH Intermediate Municipal Bond Fund’s (the “Fund”) breakdown by security type is expressed as a percentage of net assets and may vary over time.

CREDIT QUALITY

 

U.S. $ Value

  

Percent of
Total
Investments

AAA

  

$

   174,168,198

  

  17.2

%

AA

  

 

     514,377,582

  

  50.8

 

A

  

 

     276,956,668

  

  27.3

 

BBB

  

 

       46,349,996

  

    4.6

 

Not rated

  

 

         1,470,401

  

    0.1

 

TOTAL INVESTMENTS

  

$

1,013,322,845

  

100.0

%

All data as of April 30, 2024. The Fund’s credit quality is expressed as a percentage of total investments and may vary over time. Ratings are provided by Standard and Poor’s (S&P). Where S&P ratings are not available, they are substituted with Moody’s. S&P and Moody’s are independent third parties.

The accompanying notes are an integral part of these financial statements.

2

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (103.9%)

        

 

      

 

  
   

Alabama (1.1%)

        

 

      

 

  

$2,220,000

  

Black Belt Energy Gas District, Revenue Bonds1,2

  

06/01/49

  

5.500

%

      

$

2,343,452

5,000,000

  

Black Belt Energy Gas District, Revenue Bonds (SIFMA Municipal Swap Index Yield + 0.650%)2

  

04/01/53

  

4.420

 

      

 

4,885,314

3,375,000

  

Industrial Development Board of the City of Mobile Alabama, Revenue Bonds1,2

  

06/01/34

  

3.920

 

      

 

3,366,981
   

Total Alabama

        

 

      

 

10,595,747
             

 

      

 

  
   

Arizona (2.9%)

        

 

      

 

  

4,555,000

  

Chandler Industrial Development Authority, Revenue Bonds1,2

  

12/01/37

  

4.100

 

      

 

4,545,437

3,000,000

  

County of Yavapai Industrial Development Authority, Revenue Bonds

  

06/01/27

  

1.300

 

      

 

2,719,423

3,800,000

  

Salt Verde Financial Corp., Revenue Bonds

  

12/01/28

  

5.250

 

      

 

3,951,760

4,745,000

  

Salt Verde Financial Corp., Revenue Bonds

  

12/01/32

  

5.000

 

      

 

4,989,407

11,000,000

  

Salt Verde Financial Corp., Revenue Bonds

  

12/01/37

  

5.000

 

      

 

11,687,976
   

Total Arizona

        

 

      

 

27,894,003
             

 

      

 

  
   

Arkansas (0.3%)

        

 

      

 

  

1,000,000

  

County of Pulaski, Revenue Bonds

  

03/01/40

  

5.000

 

      

 

1,072,751

1,000,000

  

County of Pulaski, Revenue Bonds

  

03/01/41

  

5.000

 

      

 

1,067,817

1,000,000

  

County of Pulaski, Revenue Bonds

  

03/01/42

  

5.000

 

      

 

1,062,138
   

Total Arkansas

        

 

      

 

3,202,706
             

 

      

 

  
   

California (11.2%)

        

 

      

 

  

10,050,000

  

Allan Hancock Joint Community College District, General Obligation Bonds3

  

08/01/42

  

0.000

 

      

 

8,165,605

3,500,000

  

Anaheim Public Financing Authority, Revenue Bonds, AGM3

  

09/01/31

  

0.000

 

      

 

2,751,293

1,000,000

  

Antelope Valley Community College District, General Obligation Bonds3

  

08/01/34

  

0.000

 

      

 

686,804

1,000,000

  

Antelope Valley Community College District, General Obligation Bonds3

  

08/01/36

  

0.000

 

      

 

608,313

1,000,000

  

Antelope Valley Community College District, General Obligation Bonds3

  

08/01/38

  

0.000

 

      

 

535,317

9,200,000

  

California Infrastructure & Economic Development Bank, Revenue Bonds

  

08/01/29

  

3.250

 

      

 

9,129,069

4,825,000

  

California Municipal Finance Authority, Revenue Bonds, HUD1,2

  

09/01/45

  

3.200

 

      

 

4,733,377

1,000,000

  

Chaffey Joint Union High School District, General Obligation Bonds3

  

08/01/39

  

0.000

 

      

 

517,211

1,500,000

  

Chaffey Joint Union High School District, General Obligation Bonds3

  

08/01/40

  

0.000

 

      

 

731,940

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

3

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

California (continued)

        

 

      

 

  

$ 1,000,000

  

Chaffey Joint Union High School District, General Obligation Bonds3

  

08/01/42

  

0.000

%

      

$

439,280

1,785,000

  

Chaffey Joint Union High School District, General Obligation Bonds3

  

08/01/43

  

0.000

 

      

 

741,522

1,000,000

  

Chaffey Joint Union High School District, General Obligation Bonds3

  

08/01/44

  

0.000

 

      

 

392,785

1,450,000

  

Chino Valley Unified School District, General Obligation Bonds3

  

08/01/34

  

0.000

 

      

 

991,248

2,200,000

  

Chino Valley Unified School District, General Obligation Bonds3

  

08/01/35

  

0.000

 

      

 

1,431,701

1,000,000

  

Chino Valley Unified School District, General Obligation Bonds3

  

08/01/38

  

0.000

 

      

 

556,124

1,800,000

  

Chino Valley Unified School District, General Obligation Bonds3

  

08/01/39

  

0.000

 

      

 

945,949

1,500,000

  

Chino Valley Unified School District, General Obligation Bonds3

  

08/01/42

  

0.000

 

      

 

663,550

3,500,000

  

Dry Creek Joint Elementary School District, General Obligation Bonds3

  

08/01/35

  

0.000

 

      

 

2,298,654

5,710,000

  

Lake Tahoe Unified School District, General Obligation Bonds, AGM3

  

08/01/45

  

0.000

 

      

 

4,632,500

3,245,000

  

Lakeside Union School District/San Diego County, General Obligation Bonds3

  

08/01/35

  

0.000

 

      

 

2,131,181

1,000,000

  

Long Beach Bond Finance Authority, Revenue Bonds (3-Month CME Term SOFR + 1.450%)2

  

11/15/27

  

5.181

 

      

 

1,004,101

2,000,000

  

Los Alamitos Unified School District, Certificate Participation3

  

08/01/42

  

0.000

 

      

 

2,204,618

12,100,000

  

Modesto Irrigation District, Revenue Bonds, NPFG (3-Month CME Term SOFR + 0.630%)2

  

09/01/37

  

4.384

 

      

 

11,409,922

7,240,000

  

Mount San Antonio Community College District, General Obligation Bonds3

  

08/01/43

  

0.000

 

      

 

6,930,404

10,000,000

  

Northern California Energy Authority, Revenue Bonds1,2

  

12/01/54

  

5.000

 

      

 

10,585,643

7,030,000

  

Northern California Gas Authority No 1, Revenue Bonds (3-Month CME Term SOFR + 0.720%)2

  

07/01/27

  

4.448

 

      

 

6,992,988

1,200,000

  

Rialto Unified School District, General Obligation Bonds, BAM3

  

08/01/40

  

0.000

 

      

 

580,558

1,430,000

  

Rialto Unified School District, General Obligation Bonds, BAM3

  

08/01/42

  

0.000

 

      

 

616,932

6,300,000

  

Rio Hondo Community College District, General Obligation Bonds3

  

08/01/36

  

0.000

 

      

 

3,991,704

13,000,000

  

Rio Hondo Community College District, General Obligation Bonds3

  

08/01/43

  

0.000

 

      

 

5,247,451

The accompanying notes are an integral part of these financial statements.

4

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

California (continued)

        

 

      

 

  

$ 4,350,000

  

Rio Hondo Community College District, General Obligation Bonds3

  

08/01/44

  

0.000

%

      

$

1,659,897

1,035,000

  

Roseville Joint Union High School District, General Obligation Bonds3

  

08/01/33

  

0.000

 

      

 

721,939

6,375,000

  

Sacramento County Water Financing Authority, Revenue Bonds, NPFG (3-Month CME Term SOFR + 0.570%)2

  

06/01/39

  

4.324

 

      

 

5,740,547

3,850,000

  

San Diego County Regional Airport Authority, Revenue Bonds

  

07/01/36

  

5.250

 

      

 

4,312,977

3,510,000

  

San Mateo Union High School District, General Obligation Bonds3

  

09/01/41

  

0.000

 

      

 

3,544,022

1,040,000

  

Windsor Unified School District, General Obligation Bonds3

  

08/01/33

  

0.000

 

      

 

737,292
   

Total California

        

 

      

 

109,364,418
   

Colorado (2.2%)

        

 

      

 

  

3,275,000

  

City & County of Denver Airport System Revenue, Revenue Bonds

  

11/15/34

  

5.250

 

      

 

3,738,940

2,000,000

  

City & County of Denver Airport System Revenue, Revenue Bonds

  

11/15/35

  

5.250

 

      

 

2,272,280

790,000

  

City & County of Denver Airport System Revenue, Revenue Bonds

  

11/15/36

  

5.250

 

      

 

889,404

3,000,000

  

City & County of Denver Airport System Revenue, Revenue Bonds

  

11/15/36

  

5.750

 

      

 

3,604,443

650,000

  

City & County of Denver Airport System Revenue, Revenue Bonds

  

11/15/37

  

5.500

 

      

 

737,698

519,683

  

Colorado Housing & Finance Authority, Revenue Bonds, GNMA

  

11/01/48

  

4.200

 

      

 

507,038

3,700,000

  

E-470 Public Highway Authority, Revenue Bonds, NPFG3

  

09/01/35

  

0.000

 

      

 

2,155,055

1,450,000

  

E-470 Public Highway Authority, Revenue Bonds (SOFR + 0.350%)2

  

09/01/39

  

3.914

 

      

 

1,447,733

6,125,000

  

University of Colorado Hospital Authority, Revenue Bonds2,4

  

05/07/24

  

3.800

 

      

 

6,125,000
   

Total Colorado

        

 

      

 

21,477,591
             

 

      

 

  
   

Connecticut (2.9%)

        

 

      

 

  

165,000

  

Connecticut Housing Finance Authority, Revenue Bonds

  

05/15/30

  

2.000

 

      

 

143,735

450,000

  

Connecticut Housing Finance Authority, Revenue Bonds

  

11/15/30

  

2.050

 

      

 

392,680

400,000

  

Connecticut Housing Finance Authority, Revenue Bonds

  

05/15/31

  

2.100

 

      

 

331,874

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

5

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

Connecticut (continued)

        

 

      

 

  

$ 1,865,000

  

Connecticut Housing Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

05/15/42

  

4.250

%

      

$

1,852,792

3,500,000

  

Connecticut Housing Finance Authority, Revenue Bonds

  

05/15/54

  

6.250

 

      

 

3,770,132

5,000,000

  

Connecticut Housing Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

11/15/54

  

6.000

 

      

 

5,393,294

3,800,000

  

Connecticut State Health & Educational Facilities Authority, Revenue Bonds1,2

  

07/01/35

  

0.375

 

      

 

3,763,356

1,200,000

  

Connecticut State Health & Educational Facilities Authority, Revenue Bonds2,4

  

05/01/24

  

3.700

 

      

 

1,200,000

10,700,000

  

Connecticut State Health & Educational Facilities Authority, Revenue Bonds1,2

  

07/01/49

  

1.100

 

      

 

10,429,812

1,375,000

  

Connecticut State Health & Educational Facilities Authority, Revenue Bonds1,2

  

07/01/49

  

1.800

 

      

 

1,367,723
   

Total Connecticut

        

 

      

 

28,645,398
             

 

      

 

  
   

District of Columbia (1.9%)

        

 

      

 

  

5,665,000

  

District of Columbia, Revenue Bonds

  

07/15/40

  

5.000

 

      

 

5,739,155

5,840,000

  

Metropolitan Washington Airports Authority Aviation Revenue, Revenue Bonds

  

10/01/30

  

5.000

 

      

 

5,855,259

2,840,000

  

Metropolitan Washington Airports Authority Aviation Revenue, Revenue Bonds

  

10/01/31

  

5.000

 

      

 

2,909,325

1,170,000

  

Metropolitan Washington Airports Authority Aviation Revenue, Revenue Bonds

  

10/01/34

  

5.000

 

      

 

1,248,279

2,085,000

  

Metropolitan Washington Airports Authority Aviation Revenue, Revenue Bonds

  

10/01/37

  

5.000

 

      

 

2,253,419
   

Total District of Columbia

        

 

      

 

18,005,437
             

 

      

 

  
   

Florida (3.2%)

        

 

      

 

  

7,500,000

  

City of South Miami Health Facilities Authority, Inc., Revenue Bonds

  

08/15/42

  

5.000

 

      

 

7,612,294

1,845,000

  

County of Broward Airport System Revenue, Revenue Bonds

  

10/01/27

  

5.000

 

      

 

1,919,781

3,050,000

  

County of Broward Airport System Revenue, Revenue Bonds

  

10/01/31

  

5.000

 

      

 

3,244,568

2,965,000

  

Florida Housing Finance Corp., Revenue Bonds, FHLMC, FNMA, GNMA

  

01/01/54

  

5.500

 

      

 

3,059,444

1,920,000

  

Greater Orlando Aviation Authority, Revenue Bonds

  

10/01/32

  

5.000

 

      

 

2,100,596

2,500,000

  

Greater Orlando Aviation Authority, Revenue Bonds

  

10/01/36

  

5.000

 

      

 

2,642,207

6,565,000

  

Greater Orlando Aviation Authority, Revenue Bonds

  

10/01/36

  

5.000

 

      

 

6,781,631

3,275,000

  

Greater Orlando Aviation Authority, Revenue Bonds

  

10/01/38

  

5.000

 

      

 

3,424,103
   

Total Florida

        

 

      

 

30,784,624

The accompanying notes are an integral part of these financial statements.

6

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

Georgia (2.5%)

        

 

      

 

  

$ 5,060,000

  

Development Authority of Burke County, Revenue Bonds1,2

  

01/01/40

  

1.500

%

      

$

4,892,941

2,800,000

  

Development Authority of Burke County, Revenue Bonds1,2

  

11/01/45

  

3.250

 

      

 

2,763,517

780,000

  

Development Authority of Burke County, Revenue Bonds1,2

  

12/01/49

  

1.700

 

      

 

771,055

7,500,000

  

Main Street Natural Gas, Inc., Revenue Bonds1,2

  

12/01/53

  

5.000

 

      

 

7,920,026

1,750,000

  

Monroe County Development Authority, Revenue Bonds

  

07/01/25

  

2.250

 

      

 

1,692,540

3,935,000

  

Monroe County Development Authority, Revenue Bonds1,2

  

01/01/39

  

1.500

 

      

 

3,805,083

2,000,000

  

State of Georgia, General Obligation Bonds

  

07/01/24

  

4.000

 

      

 

2,000,489
   

Total Georgia

        

 

      

 

23,845,651
             

 

      

 

  
   

Idaho (1.4%)

        

 

      

 

  

8,600,000

  

Idaho Health Facilities Authority, Revenue Bonds2,4

  

05/01/24

  

3.700

 

      

 

8,600,000

5,000,000

  

Idaho Housing & Finance Association, Revenue Bonds, FHLMC, FNMA, GNMA

  

07/01/54

  

6.000

 

      

 

5,465,116
   

Total Idaho

        

 

      

 

14,065,116
             

 

      

 

  
   

Illinois (5.3%)

        

 

      

 

  

10,000,000

  

Illinois Finance Authority, Revenue Bonds2,4

  

05/07/24

  

3.750

 

      

 

10,000,000

4,625,000

  

Illinois Finance Authority, Revenue Bonds

  

02/15/36

  

5.000

 

      

 

4,753,322

3,470,000

  

Illinois Finance Authority, Revenue Bonds

  

08/15/36

  

4.000

 

      

 

3,511,629

10,000,000

  

Illinois Finance Authority, Revenue Bonds2,4

  

05/01/24

  

3.750

 

      

 

10,000,000

1,915,000

  

Illinois Housing Development Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

10/01/52

  

5.250

 

      

 

1,980,566

2,925,000

  

Illinois Housing Development Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

10/01/52

  

6.250

 

      

 

3,109,749

5,715,000

  

Illinois Housing Development Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

04/01/53

  

5.250

 

      

 

5,956,586

4,940,000

  

Illinois Housing Development Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

10/01/53

  

6.250

 

      

 

5,440,391

5,925,000

  

Illinois Housing Development Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

04/01/54

  

6.250

 

      

 

6,535,470
   

Total Illinois

        

 

      

 

51,287,713
             

 

      

 

  
   

Indiana (1.0%)

        

 

      

 

  

3,000,000

  

Indiana Finance Authority, Revenue Bonds

  

11/01/43

  

5.000

 

      

 

3,095,887

6,650,000

  

Indiana Housing & Community Development Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

07/01/52

  

4.750

 

      

 

6,714,516
   

Total Indiana

        

 

      

 

9,810,403

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

7

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

Iowa (1.5%)

        

 

      

 

  

$ 8,200,000

  

Iowa Finance Authority, Revenue Bonds2,4

  

05/01/24

  

3.700

%

      

$

8,200,000

120,000

  

Iowa Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

07/01/46

  

4.000

 

      

 

119,438

570,000

  

Iowa Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

01/01/49

  

3.500

 

      

 

556,005

5,105,000

  

Iowa Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

07/01/53

  

6.250

 

      

 

5,506,065
   

Total Iowa

        

 

      

 

14,381,508
             

 

      

 

  
   

Kentucky (3.1%)

        

 

      

 

  

5,000,000

  

County of Trimble, Revenue Bonds

  

11/01/27

  

1.350

 

      

 

4,468,282

3,725,000

  

County of Trimble, Revenue Bonds1,2

  

06/01/54

  

4.700

 

      

 

3,728,455

5,000,000

  

Kentucky Housing Corp., Revenue Bonds, FHLMC, FNMA, GNMA

  

07/01/54

  

6.250

 

      

 

5,517,084

3,455,000

  

Kentucky Public Energy Authority, Revenue Bonds1,2

  

12/01/49

  

4.000

 

      

 

3,454,111

12,100,000

  

Kentucky Public Energy Authority, Revenue Bonds (SOFR + 1.200%)2

  

08/01/52

  

4.764

 

      

 

11,825,721

1,265,000

  

Louisville/Jefferson County Metropolitan Government, Revenue Bonds1,2

  

10/01/47

  

5.000

 

      

 

1,346,090
   

Total Kentucky

        

 

      

 

30,339,743
             

 

      

 

  
   

Louisiana (0.5%)

        

 

      

 

  

5,180,000

  

Louisiana Public Facilities Authority, Revenue Bonds, NPFG (3-Month CME Term SOFR + 0.700%)2

  

02/15/36

  

4.431

 

      

 

4,911,737
   

Total Louisiana

        

 

      

 

4,911,737
             

 

      

 

  
   

Maryland (0.2%)

        

 

      

 

  

1,980,000

  

County of Baltimore, General Obligation Bonds

  

08/01/24

  

5.000

 

      

 

1,985,544
   

Total Maryland

        

 

      

 

1,985,544
             

 

      

 

  
   

Massachusetts (0.1%)

        

 

      

 

  

370,000

  

Massachusetts Housing Finance Agency, Revenue Bonds

  

06/01/34

  

3.300

 

      

 

351,304

485,000

  

Massachusetts Housing Finance Agency, Revenue Bonds

  

12/01/36

  

3.450

 

      

 

454,687
   

Total Massachusetts

        

 

      

 

805,991
             

 

      

 

  
   

Michigan (0.9%)

        

 

      

 

  

40,000

  

Detroit City School District, General Obligation Bonds, BHAC, FGIC

  

05/01/25

  

5.250

 

      

 

40,322

3,185,000

  

Detroit City School District, General Obligation Bonds, AGM

  

05/01/29

  

6.000

 

      

 

3,386,201

5,000,000

  

Michigan Finance Authority, Revenue Bonds

  

08/01/24

  

5.000

 

      

 

5,011,446
   

Total Michigan

        

 

      

 

8,437,969

The accompanying notes are an integral part of these financial statements.

8

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

Minnesota (2.7%)

        

 

      

 

  

$ 1,300,000

  

Duluth Independent School District No 709, General Obligation Bonds3

  

02/01/31

  

0.000

%

      

$

953,600

1,050,000

  

Duluth Independent School District No 709, General Obligation Bonds3

  

02/01/32

  

0.000

 

      

 

732,686

1,035,000

  

Duluth Independent School District No 709, General Obligation Bonds3

  

02/01/33

  

0.000

 

      

 

686,030

1,000,000

  

Minnesota Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

07/01/36

  

5.350

 

      

 

1,041,386

614,511

  

Minnesota Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

03/01/47

  

2.930

 

      

 

544,631

526,489

  

Minnesota Housing Finance Agency, Revenue Bonds, FHA, FHLMC, FNMA, GNMA

  

01/01/49

  

3.600

 

      

 

485,518

1,730,000

  

Minnesota Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

01/01/49

  

4.250

 

      

 

1,718,672

1,373,725

  

Minnesota Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

03/01/49

  

3.450

 

      

 

1,257,539

595,532

  

Minnesota Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

06/01/49

  

3.150

 

      

 

532,298

3,063,665

  

Minnesota Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

01/01/50

  

2.470

 

      

 

2,632,562

3,320,000

  

Minnesota Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

07/01/53

  

5.000

 

      

 

3,374,680

6,500,000

  

Minnesota Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

07/01/54

  

6.250

 

      

 

7,006,484

5,000,000

  

Minnesota Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA5

  

07/01/54

  

6.500

 

      

 

5,517,292
   

Total Minnesota

        

 

      

 

26,483,378
             

 

      

 

  
   

Mississippi (0.8%)

        

 

      

 

  

1,000,000

  

Mississippi Business Finance Corp., Revenue Bonds1,2

  

03/01/27

  

2.200

 

      

 

998,035

1,090,000

  

Mississippi State University Educational Building Corp., Revenue Bonds5

  

08/01/36

  

5.000

 

      

 

1,252,647

1,145,000

  

Mississippi State University Educational Building Corp., Revenue Bonds5

  

08/01/37

  

5.000

 

      

 

1,301,531

1,000,000

  

Mississippi State University Educational Building Corp., Revenue Bonds5

  

08/01/38

  

5.000

 

      

 

1,127,099

1,265,000

  

Mississippi State University Educational Building Corp., Revenue Bonds5

  

08/01/39

  

5.000

 

      

 

1,419,061

1,325,000

  

Mississippi State University Educational Building Corp., Revenue Bonds5

  

08/01/40

  

5.000

 

      

 

1,475,433
   

Total Mississippi

        

 

      

 

7,573,806

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

9

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

Missouri (0.9%)

        

 

      

 

  

$ 2,755,000

  

Missouri Housing Development Commission, Revenue Bonds, FHLMC, FNMA, GNMA

  

11/01/52

  

4.750

%

      

$

2,776,553

5,635,000

  

Missouri Housing Development Commission, Revenue Bonds, FHLMC, FNMA, GNMA

  

05/01/53

  

5.750

 

      

 

5,920,694
   

Total Missouri

        

 

      

 

8,697,247
             

 

      

 

  
   

Montana (0.2%)

        

 

      

 

  

580,000

  

Montana Board of Housing, Revenue Bonds

  

12/01/43

  

4.000

 

      

 

573,819

1,570,000

  

Montana Board of Housing, Revenue Bonds

  

12/01/52

  

5.000

 

      

 

1,596,643
   

Total Montana

        

 

      

 

2,170,462
             

 

      

 

  
   

Nebraska (1.8%)

        

 

      

 

  

14,300,000

  

Central Plains Energy Project, Revenue Bonds1,2

  

05/01/53

  

5.000

 

      

 

14,923,225

1,190,000

  

Nebraska Investment Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

09/01/49

  

3.750

 

      

 

1,166,760

1,515,000

  

Nebraska Investment Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

09/01/49

  

4.000

 

      

 

1,485,578
   

Total Nebraska

        

 

      

 

17,575,563
             

 

      

 

  
   

Nevada (1.1%)

        

 

      

 

  

2,000,000

  

County of Clark, Revenue Bonds1,2

  

01/01/36

  

3.750

 

      

 

1,977,070

2,500,000

  

County of Washoe, Revenue Bonds1,2

  

03/01/36

  

4.125

 

      

 

2,501,562

6,250,000

  

County of Washoe, Revenue Bonds1,2

  

03/01/36

  

4.125

 

      

 

6,253,904
   

Total Nevada

        

 

      

 

10,732,536
             

 

      

 

  
   

New Hampshire (0.1%)

        

 

      

 

  

1,000,000

  

New Hampshire Business Finance Authority, Revenue Bonds

  

08/01/24

  

3.125

 

      

 

996,797
   

Total New Hampshire

        

 

      

 

996,797
             

 

      

 

  
   

New Jersey (4.0%)

        

 

      

 

  

4,000,000

  

New Jersey Economic Development Authority, Revenue Bonds

  

06/15/34

  

5.000

 

      

 

4,587,387

6,330,000

  

New Jersey Economic Development Authority, Revenue Bonds

  

06/15/35

  

5.000

 

      

 

7,210,747

2,250,000

  

New Jersey Economic Development Authority, Revenue Bonds

  

06/15/36

  

5.250

 

      

 

2,596,059

10,625,000

  

New Jersey Transportation Trust Fund Authority, Revenue Bonds3

  

12/15/31

  

0.000

 

      

 

7,994,554

3,535,000

  

New Jersey Transportation Trust Fund Authority, Revenue Bonds, AGM3

  

12/15/33

  

0.000

 

      

 

2,481,515

1,565,000

  

New Jersey Transportation Trust Fund Authority, Revenue Bonds3

  

12/15/34

  

0.000

 

      

 

1,042,585

The accompanying notes are an integral part of these financial statements.

10

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

New Jersey (continued)

        

 

      

 

  

$ 5,120,000

  

New Jersey Transportation Trust Fund Authority, Revenue Bonds3

  

12/15/34

  

0.000

%

      

$

3,410,885

7,750,000

  

New Jersey Turnpike Authority, Revenue Bonds5

  

01/01/35

  

4.000

 

      

 

8,204,889

1,750,000

  

Township of Ewing, General Obligation Bonds

  

08/01/29

  

2.000

 

      

 

1,569,690
   

Total New Jersey

        

 

      

 

39,098,311
             

 

      

 

  
   

New Mexico (2.5%)

        

 

      

 

  

8,600,000

  

City of Farmington, Revenue Bonds

  

04/01/29

  

1.800

 

      

 

7,493,759

830,000

  

New Mexico Mortgage Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

01/01/49

  

4.000

 

      

 

820,853

7,000,000

  

New Mexico Mortgage Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

09/01/54

  

6.500

 

      

 

7,685,585

3,000,000

  

New Mexico Mortgage Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

03/01/55

  

5.750

 

      

 

3,193,090

5,000,000

  

New Mexico Mortgage Finance Authority, Revenue Bonds, FHLMC, FNMA, GNMA5

  

03/01/55

  

6.000

 

      

 

5,450,298
   

Total New Mexico

        

 

      

 

24,643,585
             

 

      

 

  
   

New York (7.3%)

        

 

      

 

  

2,055,000

  

Metropolitan Transportation Authority, Revenue Bonds

  

11/15/32

  

5.000

 

      

 

2,096,019

4,395,000

  

Metropolitan Transportation Authority, Revenue Bonds3

  

11/15/33

  

0.000

 

      

 

3,043,122

3,165,000

  

Metropolitan Transportation Authority, Revenue Bonds

  

11/15/37

  

5.000

 

      

 

3,253,182

8,225,000

  

Metropolitan Transportation Authority, Revenue Bonds1,2

  

11/15/45

  

5.000

 

      

 

8,812,809

5,995,000

  

New York City Municipal Water Finance Authority, Revenue Bonds

  

06/15/36

  

5.000

 

      

 

7,095,847

5,000,000

  

New York City Municipal Water Finance Authority, Revenue Bonds

  

06/15/44

  

5.000

 

      

 

5,005,643

2,565,000

  

New York State Dormitory Authority, Revenue Bonds

  

07/01/38

  

4.000

 

      

 

2,632,879

1,425,000

  

New York State Dormitory Authority, Revenue Bonds

  

03/15/39

  

5.000

 

      

 

1,426,735

8,000,000

  

Port Authority of New York & New Jersey, Revenue Bonds

  

07/15/26

  

5.000

 

      

 

8,004,393

5,000,000

  

Port Authority of New York & New Jersey, Revenue Bonds

  

09/01/30

  

5.000

 

      

 

5,016,083

5,655,000

  

Port Authority of New York & New Jersey, Revenue Bonds

  

10/15/32

  

5.000

 

      

 

5,680,155

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

11

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

New York (continued)

        

 

      

 

  

$ 1,320,000

  

Port Authority of New York & New Jersey, Revenue Bonds

  

10/15/34

  

5.000

%

      

$

1,434,288

1,500,000

  

Port Authority of New York & New Jersey, Revenue Bonds

  

07/15/35

  

5.000

 

      

 

1,610,413

1,395,000

  

Port Authority of New York & New Jersey, Revenue Bonds

  

08/01/36

  

5.000

 

      

 

1,515,434

2,750,000

  

Triborough Bridge & Tunnel Authority, Revenue Bonds (SOFR + 1.050%)2

  

04/01/26

  

4.614

 

      

 

2,755,101

1,165,000

  

Triborough Bridge & Tunnel Authority, Revenue Bonds3

  

11/15/35

  

0.000

 

      

 

721,816

6,500,000

  

Triborough Bridge & Tunnel Authority, Revenue Bonds3

  

11/15/36

  

0.000

 

      

 

3,807,265

6,875,000

  

Triborough Bridge & Tunnel Authority, Revenue Bonds1,2

  

05/15/45

  

2.000

 

      

 

6,869,903
   

Total New York

        

 

      

 

70,781,087
             

 

      

 

  
   

North Carolina (4.1%)

        

 

      

 

  

17,200,000

  

Charlotte-Mecklenburg Hospital Authority, Revenue Bonds2,4

  

05/01/24

  

3.700

 

      

 

17,200,000

1,380,000

  

North Carolina Housing Finance Agency, Revenue Bonds

  

07/01/47

  

4.000

 

      

 

1,365,776

5,970,000

  

North Carolina Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

01/01/54

  

5.500

 

      

 

6,334,486

5,000,000

  

North Carolina Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

01/01/55

  

6.250

 

      

 

5,438,128

8,850,000

  

North Carolina Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

01/01/55

  

6.250

 

      

 

9,536,099
   

Total North Carolina

        

 

      

 

39,874,489
             

 

      

 

  
   

North Dakota (1.4%)

        

 

      

 

  

775,000

  

North Dakota Housing Finance Agency, Revenue Bonds

  

01/01/49

  

4.250

 

      

 

768,844

2,820,000

  

North Dakota Housing Finance Agency, Revenue Bonds

  

07/01/49

  

4.250

 

      

 

2,801,417

3,795,000

  

North Dakota Housing Finance Agency, Revenue Bonds

  

01/01/53

  

4.000

 

      

 

3,749,852

6,145,000

  

North Dakota Housing Finance Agency, Revenue Bonds

  

07/01/53

  

5.750

 

      

 

6,453,411
   

Total North Dakota

        

 

      

 

13,773,524
             

 

      

 

  

The accompanying notes are an integral part of these financial statements.

12

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

Ohio (0.8%)

        

 

      

 

  

$ 7,155,000

  

Ohio Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

03/01/54

  

5.750

%

      

$

7,493,205
   

Total Ohio

        

 

      

 

7,493,205
             

 

      

 

  
   

Oklahoma (0.3%)

        

 

      

 

  

2,990,000

  

Oklahoma Housing Finance Agency, Revenue Bonds, FHLMC, FNMA, GNMA

  

03/01/54

  

6.000

 

      

 

3,251,472
   

Total Oklahoma

        

 

      

 

3,251,472
             

 

      

 

  
   

Oregon (5.2%)

        

 

      

 

  

3,150,000

  

Clackamas & Washington Counties School District No 3, General Obligation Bonds3

  

06/15/36

  

0.000

 

      

 

1,892,511

3,250,000

  

Clackamas County School District No 12 North Clackamas, General Obligation Bonds3

  

06/15/34

  

0.000

 

      

 

2,126,080

1,500,000

  

Lane County School District No 40 Creswell, General Obligation Bonds3

  

06/15/43

  

0.000

 

      

 

584,035

1,445,000

  

Multnomah & Clackamas Counties School District No 10JT Gresham-Barlow, General Obligation Bonds3

  

06/15/32

  

0.000

 

      

 

1,029,338

6,000,000

  

Multnomah & Clackamas Counties School District No 10JT Gresham-Barlow, General Obligation Bonds3

  

06/15/36

  

0.000

 

      

 

3,509,758

2,250,000

  

Multnomah County School District No 40, General Obligation Bonds3

  

06/15/38

  

0.000

 

      

 

1,214,721

21,000,000

  

Multnomah County School District No 40, General Obligation Bonds3

  

06/15/43

  

0.000

 

      

 

8,490,027

12,000,000

  

Multnomah County School District No 7 Reynolds, General Obligation Bonds3

  

06/15/35

  

0.000

 

      

 

7,241,730

2,000,000

  

Port of Portland Airport Revenue, Revenue Bonds

  

07/01/36

  

5.000

 

      

 

2,200,302

1,045,000

  

Salem-Keizer School District No 24J, General Obligation Bonds3

  

06/15/35

  

0.000

 

      

 

637,528

1,905,000

  

Tillamook Bay Community College District, General Obligation Bonds3

  

06/15/38

  

0.000

 

      

 

1,009,575

3,750,000

  

Washington & Multnomah Counties School District No 48J Beaverton, General Obligation Bonds3

  

06/15/31

  

0.000

 

      

 

2,841,390

3,250,000

  

Washington & Multnomah Counties School District No 48J Beaverton, General Obligation Bonds3

  

06/15/34

  

0.000

 

      

 

2,151,713

6,000,000

  

Washington & Multnomah Counties School District No 48J Beaverton, General Obligation Bonds3

  

06/15/37

  

0.000

 

      

 

3,380,398

1,800,000

  

Washington & Multnomah Counties School District No 48J Beaverton, General Obligation Bonds3

  

06/15/41

  

0.000

 

      

 

799,346

1,500,000

  

Washington Clackamas & Yamhill Counties School District No 88J, General Obligation Bonds3

  

06/15/31

  

0.000

 

      

 

1,139,735

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

13

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

Oregon (continued)

        

 

      

 

  

$ 1,055,000

  

Washington Clackamas & Yamhill Counties School District No 88J, General Obligation Bonds3

  

06/15/33

  

0.000

%

      

$

734,534

3,330,000

  

Washington Clackamas & Yamhill Counties School District No 88J, General Obligation Bonds3

  

06/15/37

  

0.000

 

      

 

1,865,881

6,000,000

  

Washington Clackamas & Yamhill Counties School District No 88J, General Obligation Bonds3

  

06/15/39

  

0.000

 

      

 

3,008,492

4,800,000

  

Washington Clackamas & Yamhill Counties School District No 88J, General Obligation Bonds3

  

06/15/40

  

0.000

 

      

 

2,255,993

5,000,000

  

Washington Clackamas & Yamhill Counties School District No 88J, General Obligation Bonds3

  

06/15/41

  

0.000

 

      

 

2,220,404
   

Total Oregon

        

 

      

 

50,333,491
             

 

      

 

  
   

Pennsylvania (3.0%)

        

 

      

 

  

1,980,000

  

Allegheny County Airport Authority, Revenue Bonds, AGM

  

01/01/35

  

5.000

 

      

 

2,188,690

1,000,000

  

Allegheny County Airport Authority, Revenue Bonds, AGM

  

01/01/36

  

5.250

 

      

 

1,119,787

1,000,000

  

Allegheny County Airport Authority, Revenue Bonds, AGM

  

01/01/37

  

5.250

 

      

 

1,109,922

5,555,000

  

Bethlehem Area School District Authority, Revenue Bonds (SOFR + 0.350%)2

  

07/01/31

  

3.914

 

      

 

5,474,829

4,855,000

  

Butler County General Authority, Revenue Bonds, AGM (3–Month CME Term SOFR + 0.700%)2

  

10/01/34

  

4.428

 

      

 

4,685,836

10,700,000

  

Pennsylvania Economic Development Financing Authority, Revenue Bonds1,2

  

08/01/37

  

0.580

 

      

 

10,598,571

2,500,000

  

School District of Philadelphia, General Obligation Bonds

  

09/01/34

  

5.000

 

      

 

2,545,097

1,470,000

  

School District of Philadelphia, General Obligation Bonds

  

09/01/36

  

4.000

 

      

 

1,487,946
   

Total Pennsylvania

        

 

      

 

29,210,678
             

 

      

 

  
   

South Carolina (0.5%)

        

 

      

 

  

2,950,000

  

South Carolina State Housing Finance & Development Authority, Revenue Bonds

  

01/01/54

  

5.750

 

      

 

3,148,186

1,995,000

  

South Carolina State Housing Finance & Development Authority, Revenue Bonds

  

01/01/54

  

6.000

 

      

 

2,169,461
   

Total South Carolina

        

 

      

 

5,317,647
             

 

      

 

  
   

South Dakota (1.7%)

        

 

      

 

  

705,000

  

South Dakota Housing Development Authority, Revenue Bonds

  

11/01/45

  

4.000

 

      

 

701,614

1,710,000

  

South Dakota Housing Development Authority, Revenue Bonds

  

11/01/46

  

3.500

 

      

 

1,693,950

The accompanying notes are an integral part of these financial statements.

14

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

South Dakota (continued)

        

 

      

 

  

$ 1,475,000

  

South Dakota Housing Development Authority, Revenue Bonds

  

11/01/48

  

4.500

%

      

$

1,471,272

2,240,000

  

South Dakota Housing Development Authority, Revenue Bonds

  

11/01/49

  

4.000

 

      

 

2,213,722

4,820,000

  

South Dakota Housing Development Authority, Revenue Bonds

  

05/01/53

  

5.000

 

      

 

4,893,207

5,580,000

  

South Dakota Housing Development Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

05/01/54

  

6.000

 

      

 

5,883,848
   

Total South Dakota

        

 

      

 

16,857,613
             

 

      

 

  
   

Tennessee (2.6%)

        

 

      

 

  

1,200,000

  

Metropolitan Nashville Airport Authority, Revenue Bonds

  

07/01/34

  

5.250

 

      

 

1,349,743

1,125,000

  

Metropolitan Nashville Airport Authority, Revenue Bonds

  

07/01/35

  

5.250

 

      

 

1,262,089

5,575,000

  

New Memphis Arena Public Building Authority, Revenue Bonds3

  

04/01/29

  

0.000

 

      

 

5,065,875

3,090,000

  

New Memphis Arena Public Building Authority, Revenue Bonds3

  

04/01/33

  

0.000

 

      

 

2,139,167

3,000,000

  

New Memphis Arena Public Building Authority, Revenue Bonds3

  

04/01/35

  

0.000

 

      

 

1,885,722

2,000,000

  

Tennessee Energy Acquisition Corp., Revenue Bonds1,2

  

05/01/52

  

5.000

 

      

 

2,101,664

1,030,000

  

Tennessee Housing Development Agency, Revenue Bonds

  

01/01/43

  

4.000

 

      

 

1,018,095

895,000

  

Tennessee Housing Development Agency, Revenue Bonds

  

07/01/48

  

4.000

 

      

 

885,316

1,620,000

  

Tennessee Housing Development Agency, Revenue Bonds

  

07/01/49

  

4.250

 

      

 

1,606,942

2,920,000

  

Tennessee Housing Development Agency, Revenue Bonds

  

01/01/53

  

5.000

 

      

 

2,981,161

5,000,000

  

Tennessee Housing Development Agency, Revenue Bonds

  

01/01/54

  

6.250

 

      

 

5,384,432
   

Total Tennessee

        

 

      

 

25,680,206
             

 

      

 

  
   

Texas (12.3%)

        

 

      

 

  

1,800,000

  

City of Austin Airport System Revenue, Revenue Bonds

  

11/15/36

  

5.000

 

      

 

1,948,848

1,120,000

  

City of Houston Airport System Revenue, Revenue Bonds

  

07/01/24

  

5.000

 

      

 

1,120,858

1,170,000

  

City of Houston Airport System Revenue, Revenue Bonds

  

07/01/25

  

5.000

 

      

 

1,182,323

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

15

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

Texas (continued)

        

 

      

 

  

$ 2,000,000

  

City of Houston Airport System Revenue, Revenue Bonds

  

07/01/31

  

5.000

%

      

$

2,145,764

3,355,000

  

City of Houston Airport System Revenue, Revenue Bonds, AGM

  

07/01/36

  

5.000

 

      

 

3,691,007

3,640,000

  

Fort Bend Independent School District, General Obligation Bonds1,2

  

08/01/51

  

0.720

 

      

 

3,333,785

1,750,000

  

Goose Creek Consolidated Independent School District, General Obligation Bonds1,2

  

02/15/35

  

0.600

 

      

 

1,633,196

4,265,000

  

La Porte Independent School District, General Obligation Bonds5

  

02/15/33

  

5.000

 

      

 

4,909,563

555,000

  

Little Elm Independent School District, General Obligation Bonds1,2

  

08/15/48

  

0.680

 

      

 

532,873

1,025,000

  

Love Field Airport Modernization Corp., Revenue Bonds

  

11/01/25

  

5.000

 

      

 

1,039,802

2,500,000

  

Love Field Airport Modernization Corp., Revenue Bonds

  

11/01/30

  

5.000

 

      

 

2,687,915

1,500,000

  

Love Field Airport Modernization Corp., Revenue Bonds

  

11/01/34

  

5.000

 

      

 

1,536,050

1,000,000

  

Love Field Airport Modernization Corp., Revenue Bonds

  

11/01/35

  

5.000

 

      

 

1,022,582

4,260,000

  

Medina Valley Independent School District, General Obligation Bonds1,2

  

02/15/51

  

0.820

 

      

 

3,983,210

10,000,000

  

Northside Independent School District, General Obligation Bonds1,2,5

  

08/01/54

  

3.450

 

      

 

9,987,623

3,850,000

  

State of Texas, General Obligation Bonds

  

08/01/30

  

4.125

 

      

 

3,849,098

6,040,000

  

State of Texas, General Obligation Bonds

  

08/01/34

  

5.000

 

      

 

6,719,813

520,000

  

Texas Department of Housing & Community Affairs, Revenue Bonds, GNMA

  

09/01/35

  

2.150

 

      

 

425,796

2,220,000

  

Texas Department of Housing & Community Affairs, Revenue Bonds, GNMA

  

07/01/37

  

2.150

 

      

 

1,730,478

4,100,000

  

Texas Department of Housing & Community Affairs, Revenue Bonds, GNMA

  

01/01/39

  

4.000

 

      

 

3,911,924

8,610,386

  

Texas Department of Housing & Community Affairs, Revenue Bonds, FHLMC, FNMA, GNMA

  

09/01/47

  

2.835

 

      

 

7,237,815

1,585,000

  

Texas Department of Housing & Community Affairs, Revenue Bonds, GNMA

  

03/01/50

  

4.000

 

      

 

1,565,987

3,410,000

  

Texas Department of Housing & Community Affairs, Revenue Bonds, GNMA

  

01/01/53

  

5.750

 

      

 

3,596,719

3,415,000

  

Texas Department of Housing & Community Affairs, Revenue Bonds, GNMA

  

03/01/53

  

6.000

 

      

 

3,681,313

3,875,000

  

Texas Department of Housing & Community Affairs, Revenue Bonds, GNMA

  

03/01/54

  

6.000

 

      

 

4,229,997

The accompanying notes are an integral part of these financial statements.

16

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  
   

Texas (continued)

        

 

      

 

  

$ 9,135,000

  

Texas Municipal Gas Acquisition & Supply Corp. I, Revenue Bonds (3-Month CME Term SOFR + 0.700%)2

  

12/15/26

  

4.446

%

      

$

9,099,954

9,145,000

  

Texas Municipal Gas Acquisition & Supply Corp. I, Revenue Bonds

  

12/15/26

  

6.250

 

      

 

9,432,266

2,790,000

  

Texas Municipal Gas Acquisition & Supply Corp. II, Revenue Bonds (SIFMA Municipal Swap Index Yield + 0.550%)2

  

09/15/27

  

4.320

 

      

 

2,732,713

10,925,000

  

Texas Municipal Gas Acquisition & Supply Corp. II, Revenue Bonds (3-Month CME Term SOFR + 0.863%)2

  

09/15/27

  

4.380

 

      

 

10,898,026

9,975,000

  

Texas Municipal Gas Acquisition & Supply Corp. II, Revenue Bonds (3-Month CME Term SOFR + 1.045%)2

  

09/15/27

  

4.616

 

      

 

9,992,785
   

Total Texas

        

 

      

 

119,860,083
             

 

      

 

  
   

Virginia (2.5%)

        

 

      

 

  

10,000,000

  

Albemarle County Economic Development Authority, Revenue Bonds2,4

  

05/07/24

  

3.750

 

      

 

10,000,000

2,750,000

  

Amelia County Industrial Development Authority, Revenue Bonds

  

04/01/27

  

1.450

 

      

 

2,516,944

8,700,000

  

Wise County Industrial Development Authority, Revenue Bonds1,2

  

10/01/40

  

0.750

 

      

 

8,134,609

3,700,000

  

York County Economic Development Authority, Revenue Bonds1,2

  

05/01/33

  

3.650

 

      

 

3,661,108
   

Total Virginia

        

 

      

 

24,312,661
             

 

      

 

  
   

Washington (2.6%)

        

 

      

 

  

6,400,000

  

Chelan County Public Utility District No 1, Revenue Bonds2,4

  

05/07/24

  

3.800

 

      

 

6,400,000

1,590,000

  

Port of Seattle, Revenue Bonds

  

06/01/25

  

3.450

 

      

 

1,573,621

1,500,000

  

Port of Seattle, Revenue Bonds

  

06/01/26

  

3.600

 

      

 

1,473,162

3,750,000

  

Port of Seattle, Revenue Bonds

  

04/01/27

  

5.000

 

      

 

3,760,199

425,000

  

Port of Seattle, Revenue Bonds

  

06/01/27

  

3.750

 

      

 

417,084

5,050,000

  

Port of Seattle, Revenue Bonds

  

08/01/34

  

5.000

 

      

 

5,473,447

1,415,000

  

Port of Seattle, Revenue Bonds

  

08/01/35

  

5.000

 

      

 

1,529,303

3,000,000

  

Port of Seattle, Revenue Bonds

  

04/01/39

  

5.000

 

      

 

3,102,355

1,940,000

  

Washington Health Care Facilities Authority, Revenue Bonds1,2

  

10/01/42

  

4.000

 

      

 

1,904,842

45,000

  

Washington State Housing Finance Commission, Revenue Bonds, FHLMC, FNMA, GNMA

  

12/01/47

  

4.000

 

      

 

44,950
   

Total Washington

        

 

      

 

25,678,963
             

 

      

 

  

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

17

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

      

Value
   

MUNICIPAL BONDS (continued)

        

 

      

 

  

 
   

Wisconsin (2.7%)

        

 

      

 

  

 

$ 4,025,000

  

County of Milwaukee Airport Revenue, Revenue Bonds

  

12/01/30

  

5.000

%

      

$

4,127,791

 

2,060,000

  

County of Milwaukee Airport Revenue, Revenue Bonds

  

12/01/31

  

5.000

 

      

 

2,112,528

 

5,345,000

  

Public Finance Authority, Revenue Bonds1,2

  

10/01/46

  

3.700

 

      

 

5,281,493

 

4,000,000

  

State of Wisconsin, General Obligation Bonds5

  

05/01/33

  

5.000

 

      

 

4,468,875

 

2,250,000

  

State of Wisconsin, General Obligation Bonds5

  

05/01/34

  

5.000

 

      

 

2,540,099

 

1,300,000

  

State of Wisconsin, General Obligation Bonds5

  

05/01/35

  

5.000

 

      

 

1,478,283

 

1,000,000

  

State of Wisconsin, General Obligation Bonds5

  

05/01/36

  

5.000

 

      

 

1,128,488

 

4,950,000

  

Wisconsin Health & Educational Facilities Authority, Revenue Bonds

  

11/15/43

  

4.000

 

      

 

4,702,152

 
   

Total Wisconsin

        

 

      

 

25,839,709

 
             

 

      

 

  

 
   

Wyoming (0.6%)

        

 

      

 

  

 

2,395,000

  

Wyoming Community Development Authority, Revenue Bonds

  

12/01/34

  

3.500

 

      

 

2,308,932

 

1,545,000

  

Wyoming Community Development Authority, Revenue Bonds

  

12/01/48

  

4.000

 

      

 

1,528,160

 

875,000

  

Wyoming Community Development Authority, Revenue Bonds

  

12/01/49

  

3.750

 

      

 

864,981

 

1,105,000

  

Wyoming Community Development Authority, Revenue Bonds, FHLMC, FNMA, GNMA

  

06/01/50

  

3.000

 

      

 

1,072,559

 
   

Total Wyoming

        

 

      

 

5,774,632

 
   

Total Municipal Bonds
(Identified cost $1,016,001,523)

        

 

      

 

1,011,852,444

 
             

 

      

 

  

 
   

SHORT-TERM MUNICIPAL BONDS (0.2%)

        

 

      

 

  

 
   

New York (0.2%)

        

 

      

 

  

 

1,470,000

  

Averill Park Central School District, General Obligation Bonds

  

06/21/24

  

4.500

 

      

 

1,470,401

 
   

Total New York

        

 

      

 

1,470,401

 
   

Total Short-term Municipal Bonds
(Identified cost $1,470,401)

        

 

      

 

1,470,401

 
             

 

      

 

  

 

TOTAL INVESTMENTS (Identified cost $1,017,471,924)6

  

104.1

%

      

$

1,013,322,845

 

LIABILITIES IN EXCESS OF CASH AND OTHER ASSETS

  

(4.1

)%

      

 

(39,803,275

)

NET ASSETS

  

100.00

%

      

$

973,519,570

 

____________

​1   This variable rate security is based on a predetermined schedule and the rate at period end also represents the reference rate at period end.

​2   Variable rate instrument. Interest rates change on specific dates (such as coupon or interest payment date). The yield shown represents the April 30, 2024 coupon or interest rate.

The accompanying notes are an integral part of these financial statements.

18

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

​3   Security issued with zero coupon. Income is recognized through accretion of discount.

​4   Variable rate demand note. The maturity date reflects the demand repayment dates. Interest rates change on specific dates (such as coupon or interest payment date). The yield shown represents the coupon or interest rate as of April 30, 2024.

​5   Represent a security purchased on a when-issued basis.

​6  The aggregate cost for federal income tax purposes is $1,017,471,924, the aggregate gross unrealized appreciation is $9,844,798 and the aggregate gross unrealized depreciation is $13,993,877, resulting in net unrealized depreciation of $4,149,079.

Abbreviations:

AGM − Assured Guaranty Municipal Corporation.

BAM − Build America Mutual.

BHAC − Berkshire Hathaway Assurance Corporation.

CME − Chicago Mercantile Exchange.

FGIC − Financial Guaranty Insurance Company.

FHA − Federal Housing Administration.

FHLMC − Federal Home Loan Mortgage Corporation.

FNMA − Federal National Mortgage Association.

GNMA − Government National Mortgage Association.

HUD − Housing Choice Voucher Program.

NPFG − National Public Finance Guarantee Corporation.

SIFMA − Securities Industry and Financial Markets Association.

SOFR − Secured Overnight Financing Rate.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

19

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Fair Value Measurements

The Fund is required to disclose information regarding the fair value measurements of the Fund’s assets and liabilities. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The disclosure requirement established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including, for example, the risk inherent in a particular valuation technique used to measure fair value, including the model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the Fund’s own considerations about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

Authoritative guidance establishes three levels of the fair value hierarchy as follows:

— Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities.

— Level 2 – significant other observable inputs (including quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.).

— Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities).

Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. Inputs may include price information, specific and broad credit data, liquidity statistics, and other factors. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires judgment by the investment adviser. The investment adviser considers observable data to be that market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The categorization of a financial instrument within the hierarchy is based upon the pricing transparency of the instrument and does not necessarily correspond to the investment adviser’s perceived risk of that instrument.

Financial assets within Level 1 are based on quoted market prices in active markets. The Fund does not adjust the quoted price for these instruments.

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. These include municipal bonds, investment-grade corporate bonds, U.S. Treasury notes and bonds, and certain non-U.S. sovereign obligations and over-the-counter derivatives. As Level 2

The accompanying notes are an integral part of these financial statements.

20

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

financial assets include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

Financial assets classified within Level 3 have significant unobservable inputs, as they trade infrequently. Level 3 financial assets include private equity and certain corporate debt securities.

Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon the actual sale of those investments.

The following table summarizes the valuation of the Fund’s investments by the above fair value hierarchy levels as of April 30, 2024.

Investments, at value

  

Unadjusted
Quoted
Prices in
Active
Markets
for Identical
Investments
(Level 1)

Significant
Other
Observable
Inputs
(Level 2)

Significant
Unobservable
Inputs
(Level 3)

Balance as of
April 30, 2024

Municipal Bonds*

      

$

—

    

$

1,011,852,444

    

$

—

    

$

1,011,852,444

  

Short-term Municipal Bonds

      

 

—

    

 

1,470,401

    

 

—

    

 

1,470,401

  

Total Investment, at value

      

$

—

    

$

1,013,322,845 

    

$

—

    

$

1,013,322,845

  

____________

*   For geographical breakdown of municipal bond investments, refer to the Portfolio of Investments.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

21

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

STATEMENT OF ASSETS AND LIABILITIES

April 30, 2024 (unaudited)

ASSETS:

  

 

  

 

Investments in securities, at value (Cost $1,017,471,924)

  

$

1,013,322,845

 

Cash

  

 

66,634

 

Receivables for:

  

 

  

 

Interest

  

 

8,488,284

 

Shares sold

  

 

3,327,292

 

Interest from Custodian

  

 

2,707

 

Prepaid expenses

  

 

5,458

 

Total Assets

  

 

1,025,213,220

 
   

 

  

 

LIABILITIES:

  

 

  

 

Payables for:

  

 

  

 

Investments purchased

  

 

50,632,346

 

Shares redeemed

  

 

525,902

 

Net investment advisory and administrative fees

  

 

313,231

 

Dividends declared

  

 

95,609

 

Custody and fund accounting fees

  

 

58,266

 

Professional fees

  

 

48,485

 

Shareholder servicing fees

  

 

8,463

 

Transfer agent fees

  

 

7,825

 

Board of Trustees’ fees

  

 

433

 

Accrued expenses and other liabilities

  

 

3,090

 

Total Liabilities

  

 

51,693,650

 
   

 

  

 

NET ASSETS

  

$

   973,519,570

 

Net Assets Consist of:

  

 

  

 

Paid-in capital

  

$

1,005,097,690

 

Accumulated deficit

  

 

(31,578,120

)

Net Assets

  

$

   973,519,570

 
   

 

  

 

NET ASSET VALUE AND OFFERING PRICE PER SHARE

  

 

  

 

CLASS N SHARES

  

 

  

 

($51,541,914 ÷ 5,050,429 shares outstanding)

  

$

10.21

 

CLASS I SHARES

  

 

  

 

($921,977,656 ÷ 90,455,080 shares outstanding)

  

$

10.19

 

The accompanying notes are an integral part of these financial statements.

22

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

STATEMENT OF OPERATIONS

For the six months ended April 30, 2024 (unaudited)

NET INVESTMENT INCOME:

  

 

  

 

Income:

  

 

  

 

Interest income

  

$

17,414,451

 

Interest income from Custodian

  

 

22,903

 

Total Income

  

 

17,437,354

 
   

 

  

 

Expenses:

  

 

  

 

Investment advisory and administrative fees

  

 

1,718,140

 

Custody and fund accounting fees

  

 

62,950

 

Shareholder servicing fees

  

 

50,585

 

Professional fees

  

 

44,512

 

Board of Trustees’ fees

  

 

42,381

 

Transfer agent fees

  

 

24,318

 

Miscellaneous expenses

  

 

62,320

 

Total Expenses

  

 

2,005,206

 

Investment advisory and administrative fee waiver

  

 

(14,363

)

Net Expenses

  

 

1,990,843

 

Net Investment Income

  

 

15,446,511

 
   

 

  

 

NET REALIZED AND UNREALIZED GAIN:

  

 

  

 

Net realized loss on investments in securities

  

 

(2,320,178

)

Net change in unrealized appreciation/(depreciation) on investments in securities

  

 

35,990,079

 

Net Realized and Unrealized Gain

  

 

33,669,901

 

Net Increase in Net Assets Resulting from Operations

  

$

49,116,412

 

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

23

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

STATEMENTS OF CHANGES IN NET ASSETS
 

For the
six months ended
April 30, 2024
(unaudited)

  

For the
year ended
October 31, 2023

INCREASE/(DECREASE) IN NET ASSETS FROM:

  

 

  

 

  

 

  

 

Operations:

  

 

  

 

  

 

  

 

Net investment income

  

$

15,446,511

 

  

$

21,951,080

 

Net realized loss on investments in securities

  

 

(2,320,178

)

  

 

(14,828,253

)

Net change in unrealized appreciation/(depreciation) on investments in securities

  

 

35,990,079

 

  

 

15,410,196

 

Net increase in net assets resulting from operations

  

 

49,116,412

 

  

 

22,533,023

 
   

 

  

 

  

 

  

 

Dividends and distributions declared:

  

 

  

 

  

 

  

 

Class N

  

 

(860,705

)

  

 

(1,317,041

)

Class I

  

 

(14,591,893

)

  

 

(20,635,433

)

Total dividends and distributions declared

  

 

(15,452,598

)

  

 

(21,952,474

)
   

 

  

 

  

 

  

 

Share transactions:

  

 

  

 

  

 

  

 

Proceeds from sales of shares

  

 

260,508,694

 

  

 

281,950,065

 

Net asset value of shares issued to shareholders for reinvestment of dividends and distributions

  

 

4,735,744

 

  

 

7,391,738

 

Proceeds from short-term redemption fees

  

 

756

 

  

 

10,858

 

Cost of shares redeemed

  

 

(71,239,514

)

  

 

(195,992,872

)

Net increase in net assets resulting from share transactions

  

 

194,005,680

 

  

 

93,359,789

 

Total increase in net assets

  

 

227,669,494

 

  

 

93,940,338

 
   

 

  

 

  

 

  

 

NET ASSETS:

  

 

  

 

  

 

  

 

Beginning of period/year

  

 

745,850,076

 

  

 

651,909,738

 

End of period/year

  

$

973,519,570

 

  

$

745,850,076

 

The accompanying notes are an integral part of these financial statements.

24

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

FINANCIAL HIGHLIGHTS

Selected per share data and ratios for a Class N share outstanding throughout each period/year.
 

For the
six months
ended
April 30, 2024
(unaudited)



For the years ended October 31,

2023    

2022    

2021    

2020    

2019    

Net asset value, beginning of period/year

  

 

  

$

9.74

 

 

 

$

9.69

 

 

 

$

10.93

 

 

 

$

10.96

 

 

  

$

10.76

 

    

$

10.15

 

  

Income from investment operations:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

Net investment income1

      

 

0.17

 

    

 

0.29

 

    

 

0.15

 

    

 

0.13

 

    

 

0.17

 

    

 

0.21

 

  

Net realized and unrealized gain/(loss)

      

 

0.47

 

    

 

0.05

 

    

 

(1.22

)

    

 

(0.02)

 

    

 

0.25

 

    

 

0.62

 

  

Total income/(loss) from investment operations

      

 

0.64

 

    

 

0.34

 

    

 

(1.07)

 

    

 

0.11

 

    

 

0.42

 

    

 

0.83

 

  

Dividends and distributions to shareholders:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

From net investment income

      

 

(0.17

)

    

 

(0.29

)

    

 

(0.16

)

    

 

(0.13

)

    

 

(0.17

)

    

 

(0.21

)

  

From net realized gains

      

 

—

 

    

 

—

 

    

 

(0.01

)

    

 

(0.01

)

    

 

(0.05)

 

    

 

(0.01)

 

  

Total dividends and distributions to shareholders

      

 

(0.17

)

    

 

(0.29

)

    

 

(0.17

)

    

 

(0.14

)

    

 

(0.22

)

    

 

(0.22

)

  

Short-term redemption fees1

      

 

0.002

 

    

 

0.002

 

    

 

0.002

 

    

 

0.002

 

    

 

0.002

 

    

 

0.002

 

  

Net asset value, end of period/year

      

$

10.21

 

    

$

9.74

 

    

$

9.69

 

    

$

10.93

 

    

$

10.96

 

    

$

10.76

 

  

Total return3

      

 

6.60

%4

    

 

3.39

%

    

 

(9.91

)%

    

 

1.01

%

    

 

4.00

%

    

 

8.21

%

  

Ratios/Supplemental data:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

Net assets, end of period/year (in millions)

      

$

52

 

    

$

47

 

    

$

55

 

    

$

82

 

    

$

92

 

    

$

54

 

  

Ratio of expenses to average net assets before reductions

      

 

0.71

%5

    

 

0.72

%

    

 

0.70

%

    

 

0.69

%

    

 

0.71

%

    

 

0.77

%

  

Fee waiver6

      

 

(0.06

)%5

    

 

(0.07

)%

    

 

(0.05

)%

    

 

(0.04

)%

    

 

(0.06

)%

    

 

(0.12

)%

  

Expense offset arrangement.

      

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

(0.00

)%7

  

Ratio of expenses to average net assets after reductions

      

 

0.65

%5

    

 

0.65

%

    

 

0.65

%

    

 

0.65

%

    

 

0.65

%

    

 

0.65

%

  

Ratio of net investment income to average net assets

      

 

3.40

%5

    

 

2.83

%

    

 

1.46

%

    

 

1.18

%

    

 

1.58

%

    

 

2.01

%

  

Portfolio turnover rate

      

 

93

%4

    

 

164

%

    

 

135

%

    

 

45

%

    

 

32

%

    

 

104

%

  

Portfolio turnover rate8

      

 

14

%4

    

 

63

%

    

 

73

%

    

 

23

%

    

 

19

%

    

 

32

%

  

____________

​1       Calculated using average shares outstanding for the period/year.

​2       Less than $0.01.

​3       Assumes reinvestment of distributions.

​4       Not annualized.

​5       Annualized.

​6   The ratio of expenses to average net assets for the six months ended April 30, 2024, the years ended October 31, 2023, 2022, 2021, 2020 and 2019, reflects fees reduced as result of a contractual operating expense limitation of the share class to 0.65%. The Agreement is effective through March 1, 2025 and may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024 and the years ended October 31, 2023, 2022, 2021, 2020 and 2019, the waived fees were $14,363, $33,916, $31,643, $35,002 and $41,531, respectively.

​7       Less than 0.01%.

​8       The portfolio turnover rate excludes variable rate demand notes.

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

25

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

FINANCIAL HIGHLIGHTS (continued)

Selected per share data and ratios for a Class I share outstanding throughout each period/year.
 

For the
six  months
ended
April 30, 2024
(unaudited)



For the years ended October 31,

2023    

2022    

2021    

2020    

2019    

Net asset value, beginning of period/year

  

 

  

$

9.73

 

 

 

$

9.68

 

 

 

$

10.92

 

 

 

$

10.95

 

 

 

$

10.75

 

 

 

$

10.14

 

 

Income from investment operations:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

Net investment income1

      

 

0.18

 

    

 

0.31

 

    

 

0.18

 

    

 

0.15

 

    

 

0.19

 

    

 

0.23

 

  

Net realized and unrealized gain/(loss)

      

 

0.46

 

    

 

0.04

 

    

 

(1.23

)

    

 

(0.02)

 

    

 

0.25

 

    

 

0.61

 

  

Total income/(loss) from investment operations

      

 

0.64

 

    

 

0.35

 

    

 

(1.05)

 

    

 

0.13

 

    

 

0.44

 

    

 

0.84

 

  

Dividends and distributions to shareholders:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

From net investment income

      

 

(0.18

)

    

 

(0.30

)

    

 

(0.18

)

    

 

(0.15

)

    

 

(0.19

)

    

 

(0.22

)

  

From net realized gains

      

 

—

 

    

 

—

 

    

 

(0.01

)

    

 

(0.01

)

    

 

(0.05

)

    

 

(0.01

)

  

Total dividends and distributions to shareholders

      

 

(0.18

)

    

 

(0.30

)

    

 

(0.19

)

    

 

(0.16

)

    

 

(0.24

)

    

 

(0.23

)

  

Short-term redemption fees1

      

 

0.002

 

    

 

0.002

 

    

 

0.002

 

    

 

0.002

 

    

 

0.002

 

    

 

0.002

 

  

Net asset value, end of period/year

      

$

10.19

 

    

$

9.73

 

    

$

9.68

 

    

$

10.92

 

    

$

10.95

 

    

$

10.75

 

  

Total return3

      

 

6.61

%4

    

 

3.60

%

    

 

(9.74

)%

    

 

1.21

%

    

 

4.18

%

    

 

8.38

%

  

Ratios/Supplemental data:

      

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

    

 

  

 

  

Net assets, end of period/year (in millions)

      

$

922

 

    

$

699

 

    

$

597

 

    

$

788

 

    

$

656

 

    

$

334

 

  

Ratio of expenses to average net assets before reductions

      

 

0.45

%5

    

 

0.45

%

    

 

0.46

%

    

 

0.45

%

    

 

0.47

%

    

 

0.50

%

  

Fee waiver6

      

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

(0.00

)%

  

Expense offset arrangement

      

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

—

%

    

 

(0.00

)%7

  

Ratio of expenses to average net assets after reductions

      

 

0.45

%5

    

 

0.45

%

    

 

0.46

%

    

 

0.45

%

    

 

0.47

%

    

 

0.50

%

  

Ratio of net investment income to average net assets

      

 

3.61

%5

    

 

3.03

%

    

 

1.69

%

    

 

1.38

%

    

 

1.75

%

    

 

2.17

%

  

Portfolio turnover rate

      

 

93

%4

    

 

164

%

    

 

135

%

    

 

45

%

    

 

32

%

    

 

104

%

  

Portfolio turnover rate8

      

 

14

%4

    

 

63

%

    

 

73

%

    

 

23

%

    

 

19

%

    

 

32

%

  

____________

​1       Calculated using average shares outstanding for the period/year.

​2       Less than $0.01.

​3       Assumes the reinvestment of distributions.

​4       Not annualized.

​5       Annualized.

​6   The ratio of expenses to average net assets for the six months ended April 30, 2024, the years ended October 31, 2023, 2022, 2021, 2020, and 2019, reflects fees reduced as result of a contractual operating expense limitation of the share class to 0.50%. The Agreement is effective through March 1, 2025 and may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024 and the years ended October 31, 2023, 2022, 2021, 2020, and 2019, the waived fees were $-, $-, $-, $-, $- and $6,608, respectively.

​7       Less than 0.01%.

​8       The portfolio turnover rate excludes variable rate demand notes.

The accompanying notes are an integral part of these financial statements.

26

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

NOTES TO FINANCIAL STATEMENTS

April 30, 2024 (unaudited)

1.  Organization. The Fund is a separate, diversified series of BBH Trust (the “Trust”), which is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust was originally organized under the laws of the State of Maryland on July 16, 1990 as BBH Fund, Inc. and re-organized as a Delaware statutory trust on June 12, 2007. As of April 30, 2024, there were eight series of the Trust. The Fund commenced operations on April 1, 2014 and offers two share classes, Class N and Class I. Neither Class N shares nor Class I shares automatically convert to any other share class of the Fund. The investment objective of the Fund is to protect investor’s capital and generate attractive risk-adjusted returns. Under normal circumstances, the Fund will invest at least 80% of its net assets, plus any borrowings for investment purposes, in municipal bonds that pay interest that is generally excludable from gross income for federal income tax purposes (except that the interest paid by certain municipal securities may be includable in taxable income for purposes of the federal alternative minimum tax).

2.  Significant Accounting Policies. The Fund’s financial statements are prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”). The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 Financial Services – Investment Companies. The following summarizes significant accounting policies of the Fund:

A. Valuation of Investments. The Board of Trustees (the “Board”) has ultimate responsibility for the supervision and oversight of the determination of the fair value of investments. Pursuant to Rule 2a-5 of the 1940 Act, the Board has designated the Investment Adviser as its valuation designee. The Investment Adviser monitors the continual appropriateness of valuation methods applied and determines if adjustments should be made in light of market factor changes and events affecting issuers. The Investment Adviser performs a series of activities to provide reasonable assurance of the appropriateness of the prices utilized, including but not limited to: periodic independent pricing service due diligence meetings and reviewing the results of back testing on a monthly basis. The Investment Adviser provides the Board with reporting on the results of the back testing as well as positions which were fair valued during the period.

All securities and other investments are recorded at their estimated fair value. The value of investments listed on a securities exchange is based on the last sale price prior to the time when assets are valued, or in the absence of recorded sales, at the most recent bid price on such exchange. If a readily available market quotation is not available or is determined to be unreliable, the investments may be valued utilizing evaluated prices provided by independent pricing services. In establishing such prices, the independent pricing service utilizes both dealer supplied prices and electronic data processing techniques which take into account appropriate factors such as institutional sized trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics, the closure of the primary exchange on which securities trade and before the Fund’s net asset value is next determined and other market data without exclusive reliance on quoted exchange prices or over-the-counter prices since such valuations are believed to reflect more accurately the fair value of

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

27

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

such investments. Investments may be fair valued by Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“SID” or “Investment Adviser”) in accordance with the BBH Trust Portfolio Valuation Policy and Procedures using methods that most fairly reflect the amount that the Fund would reasonably expect to receive for the investment on a current sale in its principal market in the ordinary course of business. Short-term investments, which mature in 60 days or less are valued at amortized cost if their original maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if their original maturity when acquired by the Fund was more than 60 days, unless the use of amortized cost is determined not to represent fair value. Any futures contracts held by the Fund are valued daily at the official settlement price of the exchange on which they are traded.

B. Accounting for Investments and Income. Investment transactions are accounted for on the trade date. Realized gains and losses on investment transactions are determined based on the identified cost method. Interest income is accrued daily and consists of interest accrued, discount earned (including, if any, both original issue and market discount) and premium amortization on the investments of the Fund. Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivable when the collection of all or a portion of the interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.

C. Fund Expenses. Most expenses of the Trust can be directly attributed to a specific fund and share class. Expenses which cannot be directly attributed to a fund are generally apportioned among each fund in the Trust and the respective share classes on a net assets basis or other suitable method. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

D. Federal Income Taxes. It is the Trust’s policy to comply with the requirements of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. The Fund files a tax return annually using tax accounting methods required under provisions of the Code, which may differ from GAAP, which is the basis on which these financial statements are prepared. Accordingly, the amount of net investment income and net realized gain reported in these financial statements may differ from that reported on the Fund’s tax return, due to certain book-to-tax timing differences such as losses deferred due to “wash sale” transactions and utilization of capital loss carryforwards. These differences may result in temporary over-distributions for financial statement purposes and are classified as distributions in excess of accumulated net realized gains or net investment income. These distributions do not constitute a return of capital. Permanent differences are reclassified between paid-in capital and retained earnings/(accumulated deficit) within the Statement of Assets and Liabilities based upon their tax classification. As such, the character of distributions to shareholders reported in the Financial Highlights table may differ from that reported to shareholders on Form 1099-DIV.

28

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

The Fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (“ASC 740”). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The Fund did not have any unrecognized tax benefits as of October 31, 2023, nor were there any increases or decreases in unrecognized tax benefits for the year then ended. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits as an income tax expense in the Statement of Operations. During the six months ended April 30, 2024, the Fund did not incur any such interest or penalties. The Fund is subject to examination by U.S. federal and state tax authorities for returns filed for the prior three years. The Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

E. Dividends and Distributions to Shareholders. Dividends and distributions from net investment income to shareholders are declared daily and paid monthly to shareholders. Distributions from net capital gains, if any, are generally declared and paid annually and are recorded on the ex-dividend date. The Fund declared dividends and distributions in the amount of $860,705 and $14,591,893 to Class N and Class I shareholders, respectively, during the six months ended April 30, 2024, and in the amount of $1,317,041 and $20,635,433 to Class N and Class I shareholders, respecively, during the year ended October 31, 2023. In addition, the Fund designated a portion of the payment made to redeeming shareholders as a distribution for income tax purpose.

The tax character of distributions paid during the years ended October 31, 2023 and 2022, respectively, were as follows:

 

Distributions paid from:
   

Ordinary
income

  

Net
long-term
capital gain

  

Total taxable
distributions

  

Tax exempt
income

  

Tax return
of capital

  

Total
distributions
paid

2023:

  

$

1,294,293

  

$

—

  

$

1,294,293

  

$

20,658,181

  

$

—

  

$

21,952,474

2022:

  

 

733,210

  

 

—

  

 

733,210

  

 

12,981,296

  

 

—

  

 

13,714,506

As of October 31, 2023 and 2022, respectively, the components of retained earnings/(accumulated deficit) were as follows:

 

Components of retained earnings/(accumulated deficit):
   

Undistributed
ordinary
income

  

Undistributed
long-term
capital gain

  

Undistributed
tax-exempt
income

  

Accumulated
capital and
other losses

  

Other
book/tax
temporary
differences

  

Unrealized
appreciation/
(depreciation)

  

Total
retained
earnings/
(accumulated
deficit)

2023:

  

$

—

  

$

—

  

$

97,537

  

$

(25,101,310

)

  

$

(99,003

)

  

$

(40,139,158

)

  

$

(65,241,934

)

2022:

  

 

—

  

 

—

  

 

23,756

  

 

(10,231,396

)

  

 

(65,489

)

  

 

(55,549,354

)

  

 

(65,822,483

)

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

29

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

The Fund had $25,101,310 net capital loss carryforwards as of October 31, 2023, of which $8,409,021 and $16,692,289, is attributable to short-term and long-term capital losses, respectively.

The Fund is permitted to carryforward capital losses for an unlimited period and they will retain their character as either short-term or long-term capital losses.

Total distributions paid may differ from amounts reported in the Statements of Changes in Net Assets because, for tax purposes, dividends are recognized when actually paid.

To the extent future capital gains are offset by capital loss carryforwards, if any, such gains will not be distributed.

F.  Use of Estimates. The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from these estimates.

3.  Fees and Other Transactions with Affiliates.

A. Investment Advisory and Administrative Fees. Effective April 1, 2014 (commencement of operations), under a combined Investment Advisory and Administrative Services Agreement (“Agreement”) with the Trust, Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“Investment Adviser”) provides investment advisory, portfolio management and administrative services to the Fund. The Fund’s investment advisory and administrative services fee is calculated daily and paid monthly at an annual rate equivalent to 0.40% of the Fund’s average daily net assets. For the six months ended April 30, 2024, the Fund incurred $1,718,140 under the Agreement.

B. Investment Advisory and Administrative Fee Waiver. Effective April 1, 2014 (commencement of operations), the Investment Adviser contractually agreed to limit the annual fund operating expenses (excluding interest, taxes, brokerage commissions, other expenditures that are capitalized in accordance with GAAP and other extraordinary expenses not incurred in the ordinary course of the Fund’s business) of Class N and Class I to 0.65% and 0.50%, respectively. The agreement will terminate on March 1, 2025, unless it is renewed by all parties to the agreement. The agreement may only be terminated during its term with approval of the Fund’s Board of Trustees. For the six months ended April 30, 2024, the Investment Adviser waived fees in the amount of $14,363 and $– for Class N and Class I, respectively.

30

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

C. Shareholder Servicing Fees. The Trust has a shareholder servicing agreement with BBH. BBH receives a fee from the Fund calculated daily and paid monthly at an annual rate of 0.20% of Class N shares’ average daily net assets. For the six months ended April 30, 2024, Class N shares of the Fund incurred $50,585 in shareholder servicing fees.

D. Custody and Fund Accounting Fees. BBH acts as a custodian and fund accountant and receives custody and fund accounting fees from the Fund calculated daily and paid monthly. BBH holds all of the Fund’s cash and investments and calculates the Fund’s daily net asset value. The custody fee is based partially on asset values and partially on individual fund transactions. The fund accounting fee is primarily an asset-based fee calculated at 0.325 basis points per annum of the Fund’s net asset value. For the six months ended April 30, 2024, the Fund incurred $62,950 in custody and fund accounting fees. As per agreement with the Fund’s custodian, the Fund receives interest income on cash balances held by the custodian at the BBH Base Rate. The BBH Base Rate is defined as BBH’s effective trading rate in local money markets on each day. The total interest earned by the Fund under the revised agreement for the six months ended April 30, 2024 was $22,903. This amount is included in “Interest income from Custodian” in the Statement of Operations. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to their agreement, the Fund will pay the BBH Overdraft Base Rate plus 2% on the day of the overdraft. The total interest incurred by the Fund for the six months ended April 30, 2024 was $6,344. This amount is included under line item “Custody and fund accounting fees” in the Statement of Operations.

E. Board of Trustees’ Fees. Each Trustee who is not an “interested person” as defined under the 1940 Act receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the six months ended April 30, 2024, the Fund incurred $42,381 in independent Trustee compensation and expense reimbursements.

F.  Officers of the Trust. Officers of the Trust are also employees of BBH. Officers are paid no fees by the Trust for their services to the Trust.

4.  Investment Transactions. For the six months ended April 30, 2024, the cost of purchases and the proceeds of sales of investment securities, other than short-term investments, was $1,016,131,440 and $819,344,588, respectively.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

31

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

5.  Shares of Beneficial Interest. The Trust is permitted to issue an unlimited number of Class N shares and Class I shares of beneficial interest, at no par value. Transactions in Class N and Class I shares were as follows:

     

For the six months ended
April 30, 2024
(unaudited)

  

For the year ended
October 31, 2023
       

Shares

  

Dollars

  

Shares

  

Dollars
   

Class N

    

 

  

 

  

 

    

 

  

 

  

 
   

Shares sold

  

619,562

 

  

$

6,336,678

 

  

2,755,041

 

  

$

27,945,104

 
   

Shares issued in connection with reinvestments of dividends

  

83,529

 

  

 

858,799

 

  

130,330

 

  

 

1,313,338

 
   

Proceeds from short-term redemption fees

  

N/A

 

  

 

128

 

  

N/A

 

  

 

17

 
   

Shares redeemed

  

(482,078

)

  

 

(4,935,587

)

  

(3,693,972

)

  

 

(37,075,353

)
   

Net increase/(decrease)

  

221,013

 

  

$

2,260,018

 

  

(808,601

)

  

$

(7,816,894

)
         

 

  

 

  

 

    

 

  

 

  

 
   

Class I

    

 

  

 

  

 

    

 

  

 

  

 
   

Shares sold

  

24,759,469

 

  

$

254,172,016

 

  

25,379,215

 

  

$

254,004,961

 
   

Shares issued in connection with reinvestments of dividends

  

377,666

 

  

 

3,876,945

 

  

603,868

 

  

 

6,078,400

 
   

Proceeds from short-term redemption fees

  

N/A

 

  

 

628

 

  

N/A

 

  

 

10,841

 
   

Shares redeemed

  

(6,502,329

)

  

 

(66,303,927

)

  

(15,840,151

)

  

 

(158,917,519

)
   

Net increase

  

18,634,806

 

  

$

191,745,662

 

  

10,142,932

 

  

$

101,176,683

 

Included in Shares Sold and Shares Redeemed are shareholder exchanges during the six months ended April 30, 2024 and the year ended October 31, 2023. Specifically:

During the six months ended April 30, 2024, there were no shareholder exchanges.

During the year ended October 31, 2023, 10,018 shares of Class I were exchanged for 10,008 shares of Class N valued at $102,417.

6.  Principal Risk Factors and Indemnifications.

A. Principal Risk Factors. Investing in the Fund may involve certain risks, as discussed in the Fund’s prospectus, including but not limited to, those described below:

A shareholder may lose money by investing in the Fund (investment risk). The Fund is actively managed and the decisions by the Investment Adviser may cause the Fund to incur losses or miss profit opportunities (management risk). Additionally, in the normal course of business, the Fund invests in securities and enters into transactions where risks exist due to redemption of securities

32

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

by the issuer before maturity (call risk), failure of a counterparty to a transaction to perform (credit risk), changes in interest rates, higher volatility for securities with longer maturities (interest rate risk), difficulty in being able to purchase or sell a security (liquidity risk) and a significant position in municipal securities in a particular state (geographic risk). Political, legislative and economic events may affect a municipal security’s value, interest payments, repayments of principal and the Fund’s ability to sell it (municipal issuer risk). Additionally, as the Fund’s exposure to similar municipal revenue sectors increases, the Fund will become more sensitive to adverse economic, business or political developments relevant to these sectors (municipal revenue sector risk). The Fund may use derivatives that could create risks that are different from, or possibly greater than, the risks associated with investing directly in securities as the Fund could lose more than the principal amount invested (derivatives risk). The value of securities held by the Fund may decline in response to certain events, including: those directly involving the companies or issuers whose securities are held by the Fund; conditions affecting the general economy; overall market changes; and political and regulatory events. Natural disasters, the spread of infectious illness and other public health emergencies, recession, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse effects on world economies and markets generally (market risk). While the Fund endeavors to purchase only bona fide tax exempt bonds, there is a risk that a bond may be reclassified by the IRS as a taxable bond creating taxable income for the Fund and its shareholders (taxation risk). The Fund may remain substantially fully invested at a time when a purchase is outstanding, then the purchases may result in a form of leverage. If the counterparty to a when-issued or delayed-delivery transaction fails to deliver the securities, the fund may receive a less favorable price or yield, or may suffer a loss (when-issued and delayed delivery securities risk).

The Fund’s shareholders may be adversely impacted by asset allocation decisions made by an investment adviser whose discretionary clients may make up a large percentage of the Fund’s shareholders (large shareholder risk). The United Kingdom’s Financial Conduct Authority announced a phase out of the LIBOR. Although many LIBOR rates were phased out by the end of 2021, some USD LIBOR settings will continue to be published under a synthetic methodology until September 30, 2024 for certain legacy contracts. The Secured Overnight Financing Rate (“SOFR“) has been used increasingly on a voluntary basis in new instruments and transactions. Under U.S. regulations that implement a statutory fallback mechanism to replace LIBOR, benchmark rates based on SOFR have replaced LIBOR in certain financial contracts. Any pricing adjustments to the fund’s investments resulting from a substitute reference rate may also adversely affect the fund’s performance and/or net asset value (LIBOR transition risk). The extent of the Fund’s exposure to these risks in respect to these financial assets is included in their value as recorded in the Fund’s Statement of Assets and Liabilities.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

33

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

Please refer to the Fund’s prospectus for a complete description of the principal risks of investing in the Fund.

B. Indemnifications. Under the Trust’s organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the Fund, and shareholders are indemnified against personal liability for the obligations of the Trust. Additionally, in the normal course of business, the Fund enters into agreements with service providers that may contain indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss from such claims is considered remote.

7.  Subsequent Events. Management has evaluated events and transactions that have occurred since April 30, 2024 through the date the financial statements were issued and determined that there were no subsequent events that would require recognition or additional disclosure in the financial statements.

34

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

DISCLOSURE OF FUND EXPENSES

April 30, 2024 (unaudited)

EXAMPLE

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested distributions, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (November 1, 2023 to April 30, 2024).

ACTUAL EXPENSES

The first line of the table provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during the period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% Hypothetical Example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

35

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

DISCLOSURE OF FUND EXPENSES (continued)

April 30, 2024 (unaudited)

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

Beginning
Account Value
November 1, 2023

  

Ending
Account Value
April 30, 2024

  

Expenses Paid
During Period
November 1, 2023 to
April 30, 20241

Class N

            

Actual

  

$1,000

  

$1,066

  

$3.34

Hypothetical2

  

$1,000

  

$1,022

  

$3.27
 

Beginning
Account Value
November 1, 2023

  

Ending
Account Value
April 30, 2024

  

Expenses Paid
During Period
November 1, 2023 to
April 30, 20241

Class I

            

Actual

  

$1,000

  

$1,066

  

$2.31

Hypothetical2

  

$1,000

  

$1,023

  

$2.26

____________

​1   Expenses are equal to the Fund’s annualized net expense ratio of 0.65% and 0.45% for Class N and I shares, respectively, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period).

​2   Assumes a return of 5% before expenses. For the purposes of the calculation, the applicable annualized expenses ratio for each class of shares is subtracted from the assumed return before expenses.

36

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

DISCLOSURE OF ADVISOR SELECTION

April 30, 2024 (unaudited)

Investment Advisory and Administrative Services Agreement Approval

The 1940 Act requires that a fund’s investment advisory agreements be approved annually by the fund’s board of trustees, including by a majority of the trustees who are not parties to the investment advisory agreements or “interested persons” of any party (“Independent Trustees”), cast in person at a meeting called for the purpose of voting on such approval.

The Board, a majority of which is comprised of Independent Trustees, held a telephonic meeting on November 16, 2023 and an in person meeting on December 12, 2023, to consider whether to renew the combined Amended and Restated Investment Advisory and Administrative Services Agreement (the “Agreement”) between the Trust and the Investment Adviser with respect to the existing funds in the Trust, including the Fund. At the December 12, 2023 meeting, the Board voted to approve the renewal of the Agreement with respect to the Fund for an additional one-year term. In doing so, the Board determined that the terms of the Agreement were fair and reasonable and in the best interest of the Fund and its shareholders, and that it had received sufficient information to make an informed business decision with respect to the continuation of the Agreement.

Both in the meetings specifically held to address the continuance of the Agreement and at other meetings over the course of the year, the Board requested, received and assessed a variety of materials provided by the Investment Adviser and BBH, including, among other things, information about the nature, extent and quality of the services provided to the Fund by the Investment Adviser and BBH, including investment management, administrative and shareholder services, the oversight of Fund service providers, marketing, risk oversight, compliance, and the ability to meet applicable legal and regulatory requirements. The Board also received comparative performance and fee and expense information for the Fund prepared by Broadridge Financial Solutions, Inc. (“Broadridge”) using data from Lipper Inc., an independent provider of investment company data (“Lipper Report”). The Board reviewed this report with Broadridge, Fund Counsel and BBH. The Board received from, and discussed with, counsel to the Trust (“Fund Counsel”) a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements under the 1940 Act, as well as the guidance provided in Gartenberg v. Merrill Lynch Asset Management, Inc., which was affirmed in Jones v. Harris Associates, L.P. In addition, the Board met in executive session outside the presence of Fund management.

In approving the continuation of the Agreement, the Board considered: (a) the nature, extent and quality of services provided by the Investment Adviser; (b) the investment performance of the Fund; (c) the advisory fee and the cost of the services and profits to be realized by the Investment Adviser from its relationship with the Fund; (d) the Fund’s costs to investors compared to the costs of comparative funds and performance compared to the relevant performance of comparative funds; (e) the sharing of potential economies of scale; (f) fall-out benefits to the Investment Adviser as a result of its relationship with the Fund; and (g) other factors deemed relevant by the Board. The following is a summary of the factors the Board considered in making its determination to approve the continuance of the Agreement. No single factor reviewed by the Board was identified as the principal factor in determining whether to approve the Agreement, and individual Trustees may have given different weight to various factors. The Board

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

37

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

reviewed these factors with Fund Counsel. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the comparative performance, expense information, the cost of the services provided, and the profits realized by the Investment Adviser.

Nature, Extent and Quality of Services

The Board noted that, under the Agreement and with respect to the Fund, the Investment Adviser, subject to the supervision of the Board, is responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Fund’s investment objective and policies. The Board further noted that, as a combined investment advisory and administration agreement, the Agreement also contemplates the provision of administrative services by the Investment Adviser to the Fund within the same fee structure.

The Board received and considered information, during December 12, 2023 meeting, and over the course of the previous year, regarding the nature, extent and quality of services provided to the Fund by the Investment Adviser including: portfolio management, supervision of operations and compliance, preparation of regulatory filings, disclosures to Fund shareholders, general oversight of service providers, organizing Board meetings and preparing the materials for such Board meetings, assistance to the Board (including the Independent Trustees in their capacity as Trustees), legal and Chief Compliance Officer services for the Trust, and other services necessary for the operation of the Fund.

The Board considered the resources of the Investment Adviser and BBH, as a whole, dedicated to the Fund noting that, pursuant to separate agreements, BBH also provides custody, shareholder servicing, and fund accounting services to the Fund. The Board considered the depth and range of services provided pursuant to the Agreement, noting that the Investment Adviser also coordinates the provision of services to the Fund by affiliated and nonaffiliated service providers.

The Board considered the scope and quality of services provided by the Investment Adviser under the Agreement. The Board reviewed the qualifications of the key investment personnel primarily responsible for the day-to-day portfolio management of the Fund. The Board also considered the policies and practices followed by BBH and the Investment Adviser. The Board noted that during the course of its regular meetings, it received reports on each of the foregoing topics. The Board concluded that, overall, they were satisfied with the nature, extent and quality of the investment advisory and administrative services provided, and expected to be provided, to the Fund pursuant to the Agreement.

Fund Performance

At the November 16, 2023 and December 12, 2023 meetings, and throughout the year, the Board received and considered performance information for the Fund provided by BBH. The Board also considered the Fund’s performance relative to a peer category of other mutual funds in a report compiled by Broadridge. As part of this review, the Trustees considered the composition of the peer category, selection criteria and reputation of Broadridge who prepared the peer category analysis. The Board reviewed with representatives of Broadridge who compiled the comparative report the report’s findings and discussed

38

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

the positioning of the Fund relative to its selected peer category. The Board considered short-term and long-term investment performance for the Fund over various periods of time noting the Fund had above average performance compared to its peer category for the 1-, 2-, 4- and 5-year periods, and had average performance for the 3-year period ended September 30, 2023. In evaluating the performance of the Fund, the Board considered the risk expectations for the Fund as well as the level of Fund performance in the context of Fund expenses and the Investment Adviser’s profitability. Based on this information, the Board concluded that it was satisfied with the Fund’s investment results.

Costs of Services Provided and Profitability

The Board considered the fee rates paid by the Fund to the Investment Adviser in light of the nature, extent and quality of the services provided to the Fund. The Board also considered and reviewed the fee waiver arrangement that was in place for the Fund and considered the actual fee rates, after taking into account the waiver. The Board received and considered information comparing the Fund’s combined investment advisory and administration fee and the Fund’s net operating expenses with those of other comparable mutual funds, such peer category and comparisons having been selected and calculated by Broadridge, noting that the Fund was very well placed, as compared to its selected peer category. The Board recognized that it is difficult to make comparisons of the fee rate, or of combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds. The Board concluded that the advisory and administration fee appeared to be both reasonable in light of the services rendered and the result of arm’s length negotiations.

With regard to profitability, the Trustees considered the compensation and benefits flowing to the Investment Adviser and BBH, directly or indirectly. The Board reviewed profitability data for the Fund using data for the period October 1, 2022 through September 30, 2023, for both the Investment Adviser and BBH. The data also included the effect of revenue generated by the shareholder servicing, custody and fund accounting fees paid by the Fund to BBH and corresponding expenses. The Board conducted a detailed review of the expense allocation methods used in preparing the profitability data. The Board focused on profitability of the Investment Adviser and BBH’s relationships with the Fund before taxes and distribution expenses. The Board concluded that the Investment Adviser’s and BBH’s profitability was not excessive in light of the nature, extent and quality of services provided to the Fund.

The Board also considered the effect of fall-out benefits to the Investment Adviser and BBH such as the increased visibility of BBH’s investment management business due to the distribution of the Trust’s funds. The Board considered other benefits received by BBH and the Investment Adviser as a result of their relationships with the Fund. These other benefits include fees received for being the Fund’s administrator, custodian, fund accounting and shareholder servicing agent. In light of the costs of providing services pursuant to the Agreement as well as the Investment Adviser and BBH’s commitment to the Fund, the ancillary benefits that the Investment Adviser and BBH received were considered reasonable.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

39

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Economies of Scale

The Board also considered the existence of economies of scale and whether those economies are passed along to the Fund’s shareholders through a graduated investment advisory fee schedule or other means, including any fee waivers by the Investment Adviser. The Board noted that the fee schedule for the Fund does not contain breakpoints. The Board considered the fee schedule for the Fund on the information they had been provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Fund, there appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints apply. In light of the Fund’s size and expense structure, the Board concluded that it was unnecessary at this time to consider breakpoints with respect to the Fund. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the comparative performance, expense information, the cost of the services provided and the profits realized by the Investment Adviser.

40

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

CONFLICTS OF INTEREST

April 30, 2024 (unaudited)

BBH&Co., including the Investment Adviser, provides discretionary and non-discretionary investment management services and products to corporations, institutions and individual investors throughout the world. As a result, in the ordinary course of its businesses, BBH&Co., including the Investment Adviser, may engage in activities in which its interests or the interests of its clients may conflict with or be adverse to the interests of the Funds. In addition, certain of such clients (including the Funds) utilize the services of BBH&Co. for which they will pay to BBH&Co. customary fees and expenses that will not be shared with the Funds.

The Investment Adviser and the Sub-advisers have adopted and implemented policies and procedures that seek to manage conflicts of interest. Pursuant to such policies and procedures, the Investment Adviser and each Sub-adviser monitor a variety of areas, including compliance with fund investment guidelines, the investment in only those securities that have been approved for purchase, and compliance with their respective Code of Ethics.

The Trust also manages these conflicts of interest. For example, the Trust has designated a CCO and has adopted and implemented policies and procedures designed to manage the conflicts identified below and other conflicts that may arise in the course of the Funds’ operations in such a way as to safeguard the Funds from being negatively affected as a result of any such potential conflicts. From time to time, the Trustees receive reports from the Investment Adviser, the Sub-advisers and the Trust’s CCO on areas of potential conflict.

Investors should carefully review the following, which describes potential and actual conflicts of interest that BBH&Co., the Investment Adviser and Sub-advisers can face in the operation of their respective investment management services. This section is not, and is not intended to be, a complete enumeration or explanation of all of the potential conflicts of interest that may arise. The Investment Adviser, the Sub-advisers and the Funds has adopted policies and procedures reasonably designed to appropriately prevent, limit or mitigate the conflicts of interest described below. Additional information about potential conflicts of interest regarding the Investment Adviser is set forth in the Investment Adviser’s Form ADV. A copy of Part 1 and Part 2A of the Investment Adviser’s Form ADV is available on the SEC’s website (www.adviserinfo.sec.gov). In addition, many of the activities that create these conflicts of interest are limited and/or prohibited by law, unless an exception is available.

Other Clients and Allocation of Investment Opportunities. BBH&Co., the Investment Adviser, and the Sub-advisers manage funds and accounts of clients other than the Funds (“Other Clients”). In general, BBH&Co., the Investment Adviser, and the Sub-advisers face conflicts of interest when they render investment advisory services to different clients and, from time to time, provide dissimilar investment advice to different clients. Investment decisions will not necessarily be made in parallel among the Funds and Other Clients. Investments made by the Funds do not, and are not intended to, replicate the investments, or the investment methods and strategies, of Other Clients. Accordingly, such Other Clients may produce results that are materially different from those experienced by the Funds. Certain other conflicts of interest may arise in connection with a portfolio manager’s management of the Funds’ investments, on the one hand, and the investments of other funds or accounts for which the portfolio

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

41

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

manager is responsible, on the other. For example, it is possible that the various funds or accounts managed by the Investment Adviser or Sub-advisers could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Funds. From time to time, the Investment Adviser and Sub-advisers, sponsor and with other investment pools and accounts which engage in the same or similar businesses as the Funds using the same or similar investment strategies. To the extent that the same investment opportunities might be desirable for more than one account or fund, possible conflicts could arise in determining how to allocate them because the Investment Adviser or Sub-advisers may have an incentive to allocate investment opportunities to certain accounts or funds. However, BBH&Co. and the Investment Adviser have implemented policies and procedures designed to ensure that information relevant to investment decisions is disseminated promptly within its portfolio management teams and investment opportunities are allocated equitably among different clients. The policies and procedures require, among other things, objective allocation for limited investment opportunities, and documentation and review of justifications for any decisions to make investments only for select accounts or in a manner disproportionate to the size of the account. Nevertheless, access to investment opportunities may be allocated differently among accounts due to the particular characteristics of an account, such as size of the account, cash position, tax status, risk tolerance and investment restrictions or for other reasons.

Actual or potential conflicts of interest may also arise when a portfolio manager has management responsibilities to multiple accounts or funds, resulting in unequal commitment of time and attention to the portfolio management of the funds or accounts.

Affiliated Service Providers. Other potential conflicts might include conflicts between the Funds and its affiliated and unaffiliated service providers (e.g., conflicting duties of loyalty). In addition to providing investment management services through the SID, BBH&Co. provides administrative, custody, shareholder servicing and fund accounting services to the Funds. BBH&Co. may have conflicting duties of loyalty while servicing the Funds and/or opportunities to further its own interest to the detriment of the Funds. For example, in negotiating fee arrangements with affiliated service providers, BBH&Co. may have an incentive to agree to higher fees than it would in the case of unaffiliated providers. BBH&Co. acting in its capacity as the Funds’ administrator is the primary valuation agent of the Funds. BBH&Co. values securities and assets in the Funds according to the Funds’ valuation policies. Because the Investment Adviser’s advisory and administrative fees are calculated by reference to a Funds’ net assets, BBH&Co. and its affiliates may have an incentive to seek to overvalue certain assets.

Aggregation. Potential conflicts of interest also arise with the aggregation of trade orders. Purchases and sales of securities for the Funds may be aggregated with orders for other client accounts managed by the Sub-advisers. The Sub-advisers, however, are not required to aggregate orders if portfolio management decisions for different accounts are made separately, or if it is determined that aggregating is not practicable, or in cases involving client direction. Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds will be charged or credited with the

42

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

average price. Thus, the effect of the aggregation may operate on some occasions to the disadvantage of the Funds. In addition, under certain circumstances, the Funds will not be charged the same commission or commission equivalent rates in connection with an aggregated order.

Cross Trades. Under certain circumstances, the Investment Adviser, on behalf of the Funds, may seek to buy from or sell securities to another fund or account advised by BBH, the Investment Adviser. Subject to applicable law and regulation, BBH&Co., the Investment Adviser may (but is not required to) effect purchases and sales between BBH&Co., the Investment Adviser clients (“cross trades”), including the Funds, if BBH&Co., the Investment Adviser or a Fund’s Sub-adviser believes such transactions are appropriate based on each party’s investment objectives and guidelines. There may be potential conflicts of interest or regulatory issues relating to these transactions which could limit the Investment Adviser’s decision to engage in these transactions for the Funds. BBH&Co., the Investment Adviser and/or a Fund’s Sub-adviser may have a potentially conflicting division of loyalties and responsibilities to the parties in such transactions.

Soft Dollars. The Investment Adviser may direct brokerage transactions and/or payment of a portion of client commissions (“soft dollars”) to specific brokers or dealers or other providers to pay for research or other appropriate services which provide, in the Investment Adviser’s view, appropriate assistance in the investment decision-making process (including with respect to futures, fixed price offerings and over-the-counter transactions). The use of a broker that provides research and securities transaction services may result in a higher commission than that offered by a broker who does not provide such services. The Investment Adviser will determine in good faith whether the amount of commission is reasonable in relation to the value of research and services provided and whether the services provide lawful and appropriate assistance in its investment decision-making responsibilities.

Research or other services obtained in this manner may be used in servicing any or all of the Funds and other accounts managed by the Investment Adviser, including in connection with accounts that do not pay commissions to the broker related to the research or other service arrangements. Such products and services may disproportionately benefit other client accounts relative to the Funds based on the amount of brokerage commissions paid by the Funds and such other accounts. To the extent that a Sub-adviser uses soft dollars, it will not have to pay for those products and services itself.

BBH&Co. may receive research that is bundled with the trade execution, clearing, and/or settlement services provided by a particular broker-dealer. To the extent that a Sub-adviser receives research on this basis, many of the same conflicts related to traditional soft dollars may exist. For example, the research effectively will be paid by client commissions that also will be used to pay for the execution, clearing, and settlement services provided by the broker-dealer and will not be paid by the Sub-adviser.

Arrangements regarding compensation and delegation of responsibility may create conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades, administration of investment advice and valuation of securities.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

43

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Investments in BBH Funds. From time to time BBH&Co. may invest a portion of the assets of its discretionary investment advisory clients in the Funds. That investment by BBH&Co. on behalf of its discretionary investment advisory clients in the Funds may be significant at times.

Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of scale that tend to reduce the Funds’ expense ratio. In selecting the Funds for its discretionary investment advisory clients, BBH&Co. may limit its selection to funds managed by BBH&Co. or the Investment Adviser. BBH&Co. may not consider or canvass the universe of unaffiliated investment companies available, even though there may be unaffiliated investment companies that may be more appropriate or that have superior performance. BBH&Co., the Investment Adviser and their affiliates providing services to the Funds benefit from additional fees when the Funds is included as an investment by a discretionary investment advisory client.

BBH&Co. reserves the right to redeem at any time some or all of the shares of the Funds acquired for its discretionary investment advisory clients’ accounts. A large redemption of shares of the Funds by BBH&Co. on behalf of its discretionary investment advisory clients could significantly reduce the asset size of the Funds, which might have an adverse effect on the Funds’ investment flexibility, portfolio diversification and expense ratio.

Valuation. When market quotations are not readily available or are believed by BBH&Co. to be unreliable, the Funds’ investments will be valued at fair value by BBH&Co. pursuant to procedures adopted by the Funds’ Board. When determining an asset’s “fair value,” BBH&Co. seeks to determine the price that a Fund might reasonably expect to receive from the current sale of that asset in an arm’s-length transaction. The price generally may not be determined based on what the Funds might reasonably expect to receive for selling an asset at a later time or if it holds the asset to maturity. While fair value determinations will be based upon all available factors that BBH&Co. deems relevant at the time of the determination and may be based on analytical values determined by BBH&Co. using proprietary or third-party valuation models, fair value represents only a good faith approximation of the value of a security. The fair value of one or more securities may not, in retrospect, be the price at which those assets could have been sold during the period in which the particular fair values were used in determining the Funds’ net asset value. As a result, the Funds’ sale or redemption of its shares at net asset value, at a time when a holding or holdings are valued by BBH&Co. (pursuant to Board-adopted procedures) at fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.

Referral Arrangements. BBH&Co. may enter into advisory and/or referral arrangements with third parties. Such arrangements may include compensation paid by BBH&Co. to the third party. BBH&Co. may pay a solicitation fee for referrals and/or advisory or incentive fees. BBH&Co. may benefit from increased amounts of assets under management.

Personal Trading. BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, face conflicts of interest when transacting in securities for their own accounts because they could benefit by trading in the same securities as the Funds, which could have an adverse effect on the Funds. However, the Investment Adviser has

44

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policy and procedures are intended to prevent BBH&Co. Partners and employees from trading in the same securities as the Funds. However, BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policies and procedures are intended to prevent BBH&Co. Partners and employees with access to Fund material non-public information from trading in the same securities as the Funds.

Gifts and Entertainment. From time to time, employees of BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, may receive gifts and/or entertainment from clients, intermediaries, or service providers to the Funds or BBH&Co., including the Investment Adviser, which could have the appearance of affecting or may potentially affect the judgment of the employees, or the manner in which they conduct business. The Investment Adviser has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees. BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

45

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM

April 30, 2024 (unaudited)

The Securities and Exchange Commission adopted Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), to promote effective liquidity risk management throughout the open-end investment company industry in order to reduce the risk that funds will be unable to meet their redemption obligations and mitigate dilution of the interests of fund shareholders.

The Board of Trustees (the “Board”) of BBH Trust has appointed three members of the Brown Brothers Harriman & Co. Mutual Fund Advisory Department, the Investment Adviser to the funds of BBH Trust (the “Funds”), as the Program Administrator for each Fund’s liquidity risk management program (the “Program”). The Board met on March 6, 2024 to review the Program for the Funds pursuant to the Liquidity Rule. The Program Administrator provided the Board with a report (the “Report”) that addressed the operations of the Program and assessed its adequacy and effectiveness for the period from February 1, 2023 through January 31, 2024 (the “Reporting Period”).

The Report noted that the Program complied with the key factors for consideration under the Liquidity Rule for assessing, managing and periodically reviewing a Fund’s liquidity risk, including the following points.

Liquidity classification. The Report described the Program’s liquidity classification methodology for categorizing the Funds’ investments into one of four liquidity buckets. The Funds classified each of their investments into one of four liquidity categories based on the number of days reasonably needed to sell and convert a reasonably anticipated sized trade of each investment into cash without significantly impacting the price of the investments. The Program Administrator relied on a third-party data provider to facilitate the classification of each Fund’s investments based on criteria in each Fund’s Program. During the Reporting Period, no Fund held more than 15% of its net assets in illiquid investments.

Highly Liquid Investment Minimum. The Report noted that one aspect of the Liquidity Rule is a requirement that funds that are expected to have less than 50% of assets classified as other than “highly liquid” should establish a minimum percentage of highly liquid assets that the fund is expected to hold on an on-going basis. The Program Administrator monitors the percentages of assets in each category on an ongoing basis and, given that no Fund has approached the 50% threshold, has made the determination that it is not necessary to assign a Highly Liquid Investment Minimum to any of the Funds as provided for in the Liquidity Rule.

The Fund’s investment strategy and liquidity of portfolio investments during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed whether each Fund’s investment strategy is appropriate for an open-end fund structure with a focus on Funds with more significant and consistent holdings of less liquid and illiquid assets and factored a Fund’s concentration in an issuer into the liquidity classification methodology by taking issuer position sizes into account.

46

    

 

BBH INTERMEDIATE MUNICIPAL BOND FUND

OPERATION AND EFFECTIVENESS OF THE FUND’S LIQUIDITY RISK MANAGEMENT PROGRAM

(continued)

April 30, 2024 (unaudited)

Short-term and long-term cash flow projections during normal and reasonably foreseeable stressed market conditions. During the Reporting Period, the Program Administrator reviewed historical redemption activity and used this information as a component to establish each Fund’s reasonably anticipated trading size. The Program Administrator also took into consideration other factors such as shareholder ownership concentration, applicable distribution channels and the degree of certainty associated with a Fund’s short-term and long-term cash flow projections.

Holdings of cash and cash equivalents. The Program Administrator considered the degree to which each Fund held cash and cash equivalents as a component of each Fund’s ability to meet redemption requests.

There were no material changes to the Program during the Reporting Period. The Program Administrator has informed the Board that it believes that the Fund’s Program is adequately designed, has been implemented as intended, and has operated effectively since its implementation. No material exceptions have been noted since the implementation of the Program, and there were no liquidity events that impacted the Fund or its ability to meet redemption requests on a timely basis during the Reporting Period.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

47

 

Administrator
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005

Distributor
Alps Distributors, Inc.
1290 Broadway, Suite 1000
Denver, Co 80203

Shareholder Servicing Agent
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005
1-800-575-1265

To obtain information or make shareholder inquiries:

  

Investment Adviser
Brown Brothers Harriman
Mutual Fund Advisory Department
140 Broadway
New York, NY 10005

By telephone:
By E-mail send your request to:
On the internet:

  

Call 1-800-575-1265
bbhfunds@bbh.com
www.bbhfunds.com

This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund.

For more complete information, visit www.bbhfunds.com for a prospectus. You should consider the Fund’s investment objectives, risks, charges and expenses carefully before you invest. Information about these and other important subjects is in the Fund’s prospectus, which you should read carefully before investing.

Holdings and allocations are subject to change. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities. Current and future holdings are subject to risk.

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Forms N-PORT are available electronically on the SEC’s website (sec.gov). For a complete list of a fund’s portfolio holdings, view the most recent holdings listing, semi-annual report, or annual report on the Fund’s web site at http://www.bbhfunds.com.

A summary of the Fund’s Proxy Voting Policy that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund’s portfolio, as well as a record of how the Fund voted any such proxies during the most recent 12-month period ended June 30, is available, without charge, upon request by calling the toll-free number listed above. This information is also available on the SEC’s website at www.sec.gov.

NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE

 

    

Semi-Annual Report

APRIL 30, 2024

BBH U.S. Government Money Market Fund

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

PORTFOLIO ALLOCATION

April 30, 2024 (unaudited)

BREAKDOWN BY SECURITY TYPE

 

U.S. $ Value

  

Percent of
Net Assets

U.S. Government Agency Obligations

  

$

275,000,000

 

  

4.0

%

U.S. Treasury Bills

  

 

5,275,362,449

 

  

77.5

 

Repurchase Agreements

  

 

1,262,000,000

 

  

18.5

 

Liabilities in Excess of Cash and Other Assets

  

 

(403,972

)

  

0.0

 

NET ASSETS

  

$

6,811,958,477

 

  

100.0%

 

All data as of April 30, 2024. The BBH U.S. Government Money Market Fund’s (the “Fund”) breakdown by security type is expressed as a percentage of net assets and may vary over time.

The accompanying notes are an integral part of these financial statements.

2

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

PORTFOLIO OF INVESTMENTS

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value
   

U.S. GOVERNMENT AGENCY
OBLIGATIONS (4.0%)

        

 

  

 

  

$ 275,000,000

  

Federal Home Loan Bank Discount Notes1

  

05/01/24

  

5.271

%

  

$

275,000,000
   

Total U.S. Government Agency Obligations
(Cost $275,000,000)

        

 

  

 

275,000,000
             

 

  

 

  
   

U.S. TREASURY BILLS (77.5%)

        

 

  

 

  

305,000,000

  

U.S. Treasury Bill1,2

 

05/02/24

  

5.314

 

  

 

304,955,649

320,000,000

  

U.S. Treasury Bill1,2

 

05/07/24

  

5.289

 

  

 

319,721,291

225,000,000

  

U.S. Treasury Bill1,2

 

05/09/24

  

5.297

 

  

 

224,738,294

300,000,000

  

U.S. Treasury Bill1,2

 

05/14/24

  

5.289

 

  

 

299,433,993

250,000,000

  

U.S. Treasury Bill1,2

 

05/16/24

  

5.287

 

  

 

249,456,104

270,000,000

  

U.S. Treasury Bill1,2

 

05/21/24

  

5.311

 

  

 

269,209,895

200,000,000

  

U.S. Treasury Bill1,2

 

05/23/24

  

5.242

 

  

 

199,370,835

205,000,000

  

U.S. Treasury Bill1,2

 

05/30/24

  

5.283

 

  

 

204,142,886

230,000,000

  

U.S. Treasury Bill1,2

  

06/04/24

  

5.304

 

  

 

228,856,514

340,000,000

  

U.S. Treasury Bill1,2

  

06/06/24

  

5.291

 

  

 

338,229,676

205,000,000

  

U.S. Treasury Bill1,2

  

06/11/24

  

5.313

 

  

 

203,769,288

150,000,000

  

U.S. Treasury Bill1

 

06/13/24

  

5.313

 

  

 

149,060,719

300,000,000

  

U.S. Treasury Bill1,2

  

06/18/24

  

5.316

 

  

 

297,890,933

250,000,000

  

U.S. Treasury Bill1,2

  

06/20/24

  

5.292

 

  

 

248,185,884

300,000,000

  

U.S. Treasury Bill1,2

 

06/25/24

  

5.303

 

  

 

297,602,229

285,000,000

  

U.S. Treasury Bill1,2

 

07/05/24

  

5.295

 

  

 

282,307,357

175,000,000

  

U.S. Treasury Bill1,2

  

07/11/24

  

5.311

 

  

 

173,191,152

150,000,000

  

U.S. Treasury Bill1,2

  

07/16/24

  

5.299

 

  

 

148,347,855

200,000,000

  

U.S. Treasury Bill1,2

  

07/18/24

  

5.211

 

  

 

197,787,099

100,000,000

  

​U.S. Treasury Bill1

  

07/23/24

  

5.290

 

  

 

98,801,111

170,000,000

  

​U.S. Treasury Bill1,2

  

08/06/24

  

5.316

 

  

 

167,603,588

140,000,000

  

​U.S. Treasury Bill1,2

  

08/20/24

  

5.329

 

  

 

137,738,622

140,000,000

  

​U.S. Treasury Bill1,2

  

09/19/24

  

5.291

 

  

 

137,166,135

100,000,000

  

U.S. Treasury Bill1

  

10/03/24

  

5.254

 

  

 

97,795,340
   

Total U.S. Treasury Bills
(Cost $5,275,362,449)

        

 

  

 

5,275,362,449
             

 

  

 

  

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

3

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

Principal
Amount

      

Maturity
Date

  

Interest
Rate

  

Value
   

REPURCHASE AGREEMENTS (18.5%)

        

 

  

 

  

 

$ 375,000,000

  

BNP Paribas (Agreement dated 04/30/24 collateralized by FCSB 2.310%-2.930%, due 07/14/36-02/03/42, original par $6,410,000, value $4,647,240, FHLB 3.375%, due 03/12/38, original par $370,000, value $306,207, FHLMC 2.000%-7.327%, due 07/01/33-04/01/54, original par $144,863,589, value $60,926,292, FNMA 1.829%-7.000%, due 06/01/29-03/01/54, original par $219,698,959, value $91,395,348, GNMA 2.500%-6.500%, due 11/15/31-03/15/59, original par $330,186,730, value $207,615,128, U.S. Treasury Securities 0.000%-4.625%, due 07/15/24-11/15/28, original par $14,154,300, value $17,609,785)

  

05/01/24

  

5.270

%

  

$

375,000,000

 

375,000,000

  

National Australia Bank Ltd. (Agreement dated 04/30/24 collateralized by U.S. Treasury Notes 2.875%, due 05/15/28, original par $404,620,000, value $382,500,000)

  

05/01/24

  

5.250

 

  

 

375,000,000

 

137,000,000

  

Royal Bank of Canada (Agreement dated 04/30/24 collateralized by U.S. Treasury Notes 2.875%, due 05/15/32, original par $156,415,000, value $139,795,906)

  

05/01/24

  

5.270

 

  

 

137,000,000

 

375,000,000

  

Societe Generale (Agreement dated 04/30/24 collateralized by U.S. Treasury Securities 1.375%-4.250%, due 03/15/27-10/31/28, original par $397,625,700, value $382,500,081)

  

05/01/24

  

5.270

 

  

 

375,000,000

 
   

Total Repurchase Agreements
(Cost $1,262,000,000)

        

 

  

 

1,262,000,000

 
             

 

  

 

  

 

TOTAL INVESTMENTS (Cost $6,812,362,449)3

  

100.0

%

  

$

6,812,362,449

 

LIABILITIES IN EXCESS OF CASH AND OTHER ASSETS

  

0.0

%

  

 

(403,972

)

NET ASSETS

  

100.0

%

  

$

6,811,958,477

 

____________

​1       Coupon represents a yield to maturity.

​2       Coupon represents a weighted average yield.

​3       The cost of securities for federal income tax purposes is substantially the same as for financial reporting purposes.

Abbreviations:

FCSB – Federal Farm Credit Consolidated System Wide Bond.

FHLB – Federal Home Loan Banks.

FHLMC – Federal Home Loan Mortgage Corporation.

FNMA – Federal National Mortgage Association.

GNMA – Government National Mortgage Association.

The accompanying notes are an integral part of these financial statements.

4

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

FAIR VALUE MEASUREMENTS

The Fund is required to disclose information regarding the fair value measurements of the Fund’s assets and liabilities. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The disclosure requirement established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including, for example, the risk inherent in a particular valuation technique used to measure fair value, including the model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the Fund’s own considerations about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

Authoritative guidance establishes three levels of the fair value hierarchy as follows:

— Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities.

— Level 2 – significant other observable inputs (including quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.).

— Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities).

Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. Inputs may include price information, specific and broad credit data, liquidity statistics, and other factors. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires judgment by the investment adviser. The investment adviser considers observable data to be that market data which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The categorization of a financial instrument within the hierarchy is based upon the pricing transparency of the instrument and does not necessarily correspond to the investment adviser’s perceived risk of that instrument.

Financial assets within Level 1 are based on quoted market prices in active markets. The Fund does not adjust the quoted price for these instruments.

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. These include investment-grade corporate bonds, U.S. Treasury notes and bonds, and certain non-U.S. sovereign obligations and over-the-counter derivatives. As Level 2 financial

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

5

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

PORTFOLIO OF INVESTMENTS (continued)

April 30, 2024 (unaudited)

assets include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

Financial assets classified within Level 3 have significant unobservable inputs, as they trade infrequently. Level 3 financial assets include private equity and certain corporate debt securities. As observable prices are not available for these securities, valuation techniques are used to derive fair value.

At April 30, 2024, 100% of the Fund’s investments in securities were valued using amortized cost, in accordance with rules under the Investment Company Act of 1940, as amended (the “1940 Act”). Amortized cost approximates the fair value of a security, but since the value is not obtained from a quoted price in an active market, securities valued at amortized cost are considered to be valued using Level 2 inputs.

Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon the actual sale of those investments.

The following table summarizes the valuation of the Fund’s investments by the above fair value hierarchy levels as of April 30, 2024.

Investments, at value

  

Unadjusted
Quoted Prices in
Active Markets
for Identical
Investments
(Level 1)

  

Significant
Other
Observable
Inputs
(Level 2)

  

Significant
Unobservable
Inputs
(Level 3)

  

Balance as of
April 30, 2024

U.S. Government Agency Obligations

  

$

—

  

$

275,000,000

  

$

—

  

$

275,000,000

U.S. Treasury Bills

  

 

—

  

 

5,275,362,449

  

 

—

  

 

5,275,362,449

Repurchase Agreements

  

 

—

  

 

1,262,000,000

  

 

—

  

 

1,262,000,000

Total Investments, at value

  

$

—

  

$

6,812,362,449

  

$

—

  

$

6,812,362,449

The accompanying notes are an integral part of these financial statements.

6

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

STATEMENT OF ASSETS AND LIABILITIES

April 30, 2024 (unaudited)

ASSETS:

    

Investments in securities, at amortized cost which approximates fair value

  

$

5,550,362,449

 

Repurchase agreements (Cost $1,262,000,000)

  

 

1,262,000,000

 

Cash

  

 

1,630,714

 

Receivables for:

  

 

  

 

Interest

  

 

184,534

 

Interest from Custodian

  

 

77,740

 

Prepaid expenses

  

 

47,581

 

Total Assets

  

 

6,814,303,018

 

LIABILITIES:

  

 

  

 

Payables for:

  

 

  

 

Investment advisory and administrative fees

  

 

1,166,581

 

Dividends declared

  

 

950,807

 

Custody and fund accounting fees

  

 

177,832

 

Professional fees

  

 

34,148

 

Transfer agent fees

  

 

5,180

 

Board of Trustees’ fees

  

 

424

 

Accrued expenses and other liabilities

  

 

9,569

 

Total Liabilities

  

 

2,344,541

 

NET ASSETS

  

$

6,811,958,477

 
   

 

  

 

Net Assets Consist of:

  

 

  

 

Paid-in capital

  

$

6,811,968,890

 

Distributions in excess of net investment income

  

 

(10,413

)

Net Assets

  

$

6,811,958,477

 
   

 

  

 

NET ASSET VALUE AND OFFERING PRICE PER SHARE

  

 

  

 

INSTITUTIONAL SHARES

  

 

  

 

($6,811,958,477 ÷ 6,811,974,908 shares outstanding)

  

$

1.00

 

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

7

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

STATEMENT OF OPERATIONS

For the six months ended April 30, 2024 (unaudited)

NET INVESTMENT INCOME:

  

 

  

 

Income:

  

 

  

 

Interest income

  

$

180,259,757

 

Interest income from Custodian

  

 

581,329

 

Total Income

  

 

180,841,086

 
   

 

  

 

Expenses:

  

 

  

 

Investment advisory and administrative fees

  

 

6,975,324

 

Custody and fund accounting fees

  

 

302,326

 

Board of Trustees’ fees

  

 

73,302

 

Professional fees

  

 

31,645

 

Transfer agent fees

  

 

17,065

 

Miscellaneous expenses

  

 

63,216

 

Total Expenses

  

 

7,462,878

 

Net Investment Income

  

 

173,378,208

 
   

 

  

 

NET REALIZED LOSS:

  

 

  

 

Net realized loss on investments

  

 

(291

)

Net Increase in Net Assets Resulting from Operations

  

$

173,377,917

 

The accompanying notes are an integral part of these financial statements.

8

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

STATEMENTS OF CHANGES IN NET ASSETS
 

For the
six months ended
April 30, 2024
(unaudited)

  

For the
year ended
October 31, 2023

INCREASE/(DECREASE) IN NET ASSETS FROM:

  

 

  

 

  

 

  

 

Operations:

  

 

  

 

  

 

  

 

Net investment income

  

$

173,378,208

 

  

$

243,682,841

 

Net realized loss on investments

  

 

(291

)

  

 

(477,212

)

Net increase in net assets resulting from operations

  

 

173,377,917

 

  

 

243,205,629

 
   

 

  

 

  

 

  

 

Dividends and distributions declared:

  

 

  

 

  

 

  

 

Institutional Shares

  

 

(173,386,896

)

  

 

(243,205,629

)
   

 

  

 

  

 

  

 

Share transactions:

  

 

  

 

  

 

  

 

Fund shares sold and fund shares issued in connection with reinvestments of dividends

  

 

4,508,724,367

 

  

 

7,328,113,029

 

Fund shares repurchased

  

 

(3,595,723,192

)

  

 

(6,224,168,203

)

Net increase in net assets resulting from fund share transactions

  

 

913,001,175

 

  

 

1,103,944,826

 

Total increase in net assets

  

 

912,992,196

 

  

 

1,103,944,826

 
   

 

  

 

  

 

  

 

NET ASSETS:

  

 

  

 

  

 

  

 

Beginning of period/year

  

 

5,898,966,281

 

  

 

4,795,021,455

 

End of period/year

  

$

6,811,958,477

 

  

$

5,898,966,281

 

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

9

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

FINANCIAL HIGHLIGHTS

Selected per share data and ratios for a class Institutional share outstanding throughout each period/year.
 

For the
six months
ended
April 30, 
2024
(unaudited)

  




For the years ended
October 31,

  

For the 
period
from July 1,
2019 to
October 31, 
2019

  


For the
year
ended
June 30,
2019

2023

  

2022

  

2021

  

2020

  

Net asset value, beginning of
period/year

  

$

1.00

 

  

$

1.00

 

  

$

1.00

 

  

$

1.00

 

  

$

1.00

 

  

$

1.00

 

  

$

1.00

 

Income from investment operations:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Net investment income1

  

 

0.03

 

  

 

0.05

 

  

 

0.01

 

  

 

0.002

 

  

 

0.01

 

  

 

0.01

 

  

 

0.02

 

Net realized and unrealized gain/(loss)

  

 

(0.00

)2

  

 

(0.01

)

  

 

0.002

 

  

 

(0.00

)2

  

 

0.002

 

  

 

0.002

 

  

 

0.002

 

Total income from investment operations

  

 

0.03

 

  

 

0.04

 

  

 

0.01

 

  

 

0.002

 

  

 

0.01

 

  

 

0.01

 

  

 

0.02

 

Dividends and distributions to shareholders:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

From net investment income

  

 

(0.03

)

  

 

(0.04

)

  

 

(0.01

)

  

 

(0.00

)2

  

 

(0.01

)

  

 

(0.01

)

  

 

(0.02

)

Total dividends and distributions to shareholders

  

 

(0.03

)

  

 

(0.04

)

  

 

(0.01

)

  

 

(0.00

)2

  

 

(0.01

)

  

 

(0.01

)

  

 

(0.02

)

Net asset value, end of period/year

  

$

1.00

 

  

$

1.00

 

  

$

1.00

 

  

$

1.00

 

  

$

1.00

 

  

$

1.00

 

  

$

1.00

 

Total return3

  

 

2.60

%4

  

 

4.59

%

  

 

0.75

%

  

 

0.01

%

  

 

0.59

%

  

 

0.63

%4

  

 

2.02

%
   

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Ratios/Supplemental data:

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

Net assets, end of period/year (in millions)

  

$

6,812

 

  

$

5,899

 

  

$

4,795

 

  

$

4,227

 

  

$

3,475

 

  

$

2,040

 

  

$

2,126

 

Ratio of expenses to average net assets before reductions

  

 

0.22

%5

  

 

0.23

%

  

 

0.23

%

  

 

0.23

%

  

 

0.24

%

  

 

0.24

%6

  

 

0.24

%

Expense reimbursement7

  

 

—

%

  

 

—

%

  

 

(0.08

)%

  

 

(0.19

)%

  

 

(0.05

)%

  

 

—

%

  

 

—

%

Expense offset arrangement

  

 

—

%

  

 

—

%

  

 

—

%

  

 

—

%

  

 

—

%

  

 

—

%

  

 

(0.01

)%

Ratio of expenses to average net assets after reductions

  

 

0.22

%5

  

 

0.23

%

  

 

0.15

%

  

 

0.04

%

  

 

0.19

%

  

 

0.24

%6

  

 

0.23

%

Ratio of net investment income to average net assets

  

 

5.15

%5

  

 

4.52

%

  

 

0.73

%

  

 

0.01

%

  

 

0.48

%

  

 

1.86

%6

  

 

2.02

%

____________

​1        Calculated using average shares outstanding for the period/year.

​2        Less than $0.01 per share.

​3        Assumes the reinvestment of distributions.

​4        Not annualized.

​5        Annualized.

​6        Annualized with the exception of audit fees.

​7   During the six months ended April 30, 2024, the years ended October 31, 2023, 2022, 2021, 2020, the period from July 1, 2019 to October 31, 2019, and the year ended June 30, 2019, the investment advisory and administrative fee/shareholder servicing fee waivers, as a result of a voluntary minimum yield agreement, were $-, $-, $3,724,415, $7,060,486, $1,299,428, $- and $-, respectively.

The accompanying notes are an integral part of these financial statements.

10

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

NOTES TO FINANCIAL STATEMENTS

April 30, 2024 (unaudited)

1. Organization. The Fund is a separate series of BBH Trust (the “Trust”), which is registered under the 1940 Act, as an open-end management investment company. The Trust was originally organized as a Massachusetts business trust on June 7, 1983 and re-organized as a Delaware statutory trust on June 12, 2007. As of April 30, 2024, there were eight series of the Trust. The Fund commenced operations on December 12, 1983. The Fund currently offers one class of shares designated as Institutional Shares. The investment objective of the Fund is to provide investors with as high a level of income as is consistent with the preservation of capital and the maintenance of liquidity. Under normal circumstances, the Fund invests at least 99.5% of its total assets in cash and short-term U.S. Treasury securities and securities issued by U.S. government agencies or government-sponsored enterprises and repurchase agreements fully collateralized by such instruments. Additionally, under normal circumstances, at least 80% of the value of the Fund’s net assets will be invested in U.S. government securities and repurchase agreements fully collateralized by U.S. government securities. Effective July 1, 2019, the Fund changed its fiscal year end from June 30 to October 31.

2. Significant Accounting Policies. The Fund’s financial statements are prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”). The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification Topic 946 Financial Services – Investment Companies. The following summarizes significant accounting policies of the Fund:

A. Valuation of Investments. The Board of Trustees (the “Board”) has ultimate responsibility for the supervision and oversight of the determination of the fair value of investments. Pursuant to Rule 2a-5 of the 1940 Act, the Board has designated the Investment Adviser as its valuation designee. The Investment Adviser monitors the continual appropriateness of valuation methods applied and determines if adjustments should be made in light of market factor changes and events affecting issuers. The Investment Adviser performs a series of activities to provide reasonable assurance of the appropriateness of the prices utilized, including but not limited to: periodic independent pricing service due diligence meetings and reviewing the results of back testing on a monthly basis. The Investment Adviser provides the Board with reporting on the results of the back testing as well as positions which were fair valued during the period.

The Fund values its investments at amortized cost, which approximates fair value. The amortized cost method values a security at its cost at the time of purchase and thereafter assumes a constant amortization to maturity of any discount or premium. The Fund’s use of amortized cost is in compliance with Rule 2a-7 of the 1940 Act. In the event that security valuations do not approximate fair value, securities may be valued as determined in accordance with procedures adopted by the Board.

B. Accounting for Investments and Income. Investment transactions are accounted for on the trade date. Realized gains and losses on investment transactions are determined based on the identified cost method. Interest income is accrued as earned and consists of interest accrued, accretion of discount on debt securities (including both original issue and market discount) and premium amortization on the investments of the Fund.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

11

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

C. Fund Expenses. Most expenses of the Trust can be directly attributed to a specific fund. Expenses which cannot be directly attributed to a fund are generally apportioned among each fund in the Trust on a net assets basis or other suitable method. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

D. Repurchase Agreements. The Fund may enter into repurchase agreements. Repurchase agreements are transactions in which the Fund buys a security from a dealer or bank and agrees to sell the security back at a mutually agreed upon time and price. The repurchase price normally is in excess of the purchase price, reflecting an agreed upon interest rate. The rate is effective for the period of time that assets of the Fund are invested in the agreement and is not related to the coupon rate on the underlying security. The Fund will enter into repurchase agreements only with banks and other recognized financial institutions, such as securities dealers, deemed creditworthy by the investment adviser. The Fund’s custodian or sub-custodian will take possession of the securities subject to repurchase agreements. The investment adviser, custodian or sub-custodian will monitor the marked-to-market value of the underlying collateral each day to ensure that the value of the security always equals or exceeds the repurchase price.

Repurchase agreements are entered into by the Fund under Master Repurchase Agreements (MRA) which permit the Fund, under certain circumstances including an event of default (such as bankruptcy or insolvency), to offset payables and/or receivables under the MRA with collateral held and/or posted to the counterparty and create one single net payment due to or from the Fund. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of the MRA counterparty’s bankruptcy or insolvency. Lastly, the MRA does not preclude the Fund from selling, transferring, pledging or hypothecating the underlying collateral but no such transaction shall relieve the Fund of its obligation to transfer the collateral to the counterparty upon the latter’s repurchase of the securities.

The Fund’s repurchase agreements and information related to collateral, which could be offset in event of default, are shown in the Portfolio of Investments.

E. Federal Income Taxes. It is the Trust’s policy to comply with the requirements of the Internal Revenue Code (the “Code”) applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. The Fund files a tax return annually using tax accounting methods required under provisions of the Code, which may differ from GAAP, which is the basis on which these financial statements are prepared. Accordingly, the amount of net investment income and net realized gain reported in these financial statements may differ from that reported on the Fund’s tax return, due to certain book-to-tax timing differences such as losses deferred due to “wash sale” transactions and utilization of capital loss carryforwards. These differences result in temporary over-distributions for financial statement purposes and are classified as distributions in excess of accumulated net realized gains or net investment income. These distributions do not constitute a return of capital. Permanent differences are reclassified between paid-in capital and retained earnings/(accumulated

12

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

deficit) within the Statement of Assets and Liabilities based upon their tax classification. As such, the character of distributions to shareholders reported in the Financial Highlights table may differ from that reported to shareholders on Form 1099-DIV.

The Fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (“ASC 740”). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The Fund did not have any unrecognized tax benefits as of October 31, 2023, nor were there any increases or decreases in unrecognized tax benefits for the period then ended. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits as an income tax expense in the Statement of Operations. During the six months ended April 30, 2024, the Fund did not incur any such interest or penalties. The Fund is subject to examination by U.S. federal and state tax authorities for returns filed for the prior three years. The Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

F.  Dividends and Distributions to Shareholders. Dividends and distributions from net investment income to shareholders are declared daily and paid monthly to shareholders. Distributions from net capital gains, if any, are generally declared and paid annually and are recorded on the ex-dividend date. The Fund declared dividends in the amounts of $173,386,896 to Institutional shareholders, during the six months ended April 30, 2024.

The tax character of distributions paid during the years ended October 31, 2023 and 2022, respectively, were as follows:

 

Distributions paid from:
       

Ordinary
income

  

Net
long-term
capital gain

  

Total taxable
distributions

  

Total
Distributions
paid
   

2023:

  

$

243,205,629

  

$

—

  

$

243,205,629

  

$

243,205,629
   

2022:

  

 

35,394,673

  

 

—

  

 

35,394,673

  

 

35,394,673

As of October 31, 2023 and 2022, respectively, the components of retained earnings/(accumulated deficit) on tax basis were as follows:

 

Components of retained earnings/(accumulated deficit):
       

Undistributed
ordinary
income

  

Undistributed
long-term
capital gain

  

Accumulated
capital and
other losses

  

Other
book/tax
temporary
differences

  

Unrealized
appreciation/
(depreciation)

  

Total
retained
earnings/
(accumulated
deficit)
   

2023:

  

$

1,303,719

  

$

—

  

$

(478,160

)

  

$

(826,993

)

  

$

—

  

$

(1,434

)
   

2022:

  

 

380,489

  

 

—

  

 

(948

)

  

 

(380,975

)

  

 

—

  

 

(1,434

)

The Fund had $478,160 net capital loss carryforwards as of October 31, 2023, of which $478,160 and $0, is attributable to short-term and long-term capital losses, respectively.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

13

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

The Fund is permitted to carryforward capital losses incurred in taxable years beginning after December 22, 2010, for an unlimited period and they will retain their character as either short-term or long-term capital losses.

Total distributions paid may differ from the amounts shown in the Statements of Changes in Net Assets because, for tax purposes, dividends are recognized when actually paid.

There are no significant differences between book-basis and tax-basis unrealized appreciation/
(depreciation) for investments for the current year.

To the extent future capital gains are offset by future capital loss carryforwards, if any, such gains will not be distributed.

G. Use of Estimates. The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from these estimates.

3. Fees and Other Transactions with Affiliates.

A. Investment Advisory and Administrative Fees. Under a combined Investment Advisory and Administrative Services Agreement (“Agreement”) with the Trust, Brown Brothers Harriman & Co. (“BBH”) through a separately identifiable department (“Investment Adviser”) provides investment advisory and portfolio management services to the Fund. BBH also provides administrative services to the Fund. The Fund pays a combined fee for investment advisory and administrative services calculated daily and paid monthly at an annual rate equivalent to 0.25% on the first $1,000,000,000 of the Fund’s average daily net assets and 0.20% of the Fund’s average daily net assets in excess of $1,000,000,000. For the six months ended April 30, 2024, the Fund incurred $6,975,324 for services under the Agreement.

B. Investment Advisory and Administrative Fee Waiver. BBH may from time to time voluntarily waive all or a portion of its advisory and administration fee from the Fund. For the six months ended April 30, 2024, BBH waived fees in the amount of $0 for Institutional Shares.

C. Custody and Fund Accounting Fees. BBH acts as a custodian and fund accountant and receives custody and fund accounting fees from the Fund calculated daily and paid monthly. BBH holds all of the Fund’s cash and investments and calculates the Fund’s daily net asset value. The custody fee is based partially on asset values and partially on individual fund transactions. The fund accounting fee is primarily an asset-based fee calculated at 0.325 basis points per annum of the Fund’s net asset value. For the six months ended April 30, 2024, the Fund incurred $302,326 in custody and fund accounting fees. As per agreement with the Fund’s custodian, the Fund receives interest income on

14

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

cash balances held by the custodian at the BBH Base Rate. The BBH Base Rate is defined as BBH’s effective trading rate in local money markets on each day. The total interest earned by the Fund under the agreement for the six months ended April 30, 2024 was $581,329. This amount is included in “Interest income from Custodian” in the Statement of Operations. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to their agreement, the Fund will pay the BBH Overdraft Base Rate plus 2% on the day of the overdraft. The total interest incurred by the Fund for the six months ended April 30, 2024 was $51,293. This amount is included in the “Custody and fund accounting fees” in the Statement of Operations.

D. Board of Trustees’ Fees. Each Trustee who is not an “interested person” as defined under the 1940 Act (referred to here as an “Independent Trustee”) receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the six months ended April 30, 2024, the Fund incurred $73,302 in Independent Trustee compensation and expense reimbursements.

E. Officers of the Trust. Officers of the Trust are also employees of BBH. Officers are paid no fees by the Trust for their services to the Trust.

4.  Shares of Beneficial Interest. The Trust is permitted to issue an unlimited number of Institutional Shares of beneficial interest, at no par value. Transactions in Institutional Shares were as follows:

 

For the six months ended
April 30, 2024 (unaudited)

  

For the year ended
October 31, 2023

Shares

  

Dollars

  

Shares

  

Dollars

Institutional Shares

    

 

  

 

  

 

    

 

  

 

  

 

Shares sold

  

4,508,710,719

 

  

$

4,508,710,719

 

  

7,328,089,995

 

  

$

7,328,089,995

 

Shares issued in connection with reinvestments of dividends

  

13,648

 

  

 

13,648

 

  

23,034

 

  

 

23,034

 

Shares redeemed

  

(3,595,723,192

)

  

 

(3,595,723,192

)

  

(6,224,168,203

)

  

 

(6,224,168,203

)

Net increase

  

913,001,175

 

  

$

913,001,175

 

  

1,103,944,826

 

  

$

1,103,944,826

 

5.  Principal Risk Factors and Indemnifications.

A. Principal Risk Factors. Investing in the Fund may involve certain risks, as discussed in the Fund’s prospectus, including but not limited to, those described below:

Investments in the Fund are neither insured nor guaranteed by the U.S. Government. Shares of the Fund are not deposits or obligations of, or guaranteed by, BBH or any other bank, and the shares are neither insured nor guaranteed by the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other federal, state or other governmental agency. BBH has no legal

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

15

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

obligation to provide financial support to the Fund and you should not expect that BBH as the Fund’s sponsor will provide financial support to the Fund at any time. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

The divergence of the Fund’s amortized cost price per share from its market based net asset value per share may result in the Fund’s inability to maintain a stable $1.00 NAV, resulting in material dilution or other unfair results to shareholders (stable NAV risk). In the normal course of business, the Fund invests in securities and enters into transactions where risks exist due to fluctuations in the market (market risk), failure of an issuer, guarantor or counterparty to a transaction to perform (credit risk) or changes in interest rates (interest rate risk). The Fund is subject to the risk that the securities selected by the investment adviser may underperform (management risk). Even though the Fund’s investments in repurchase agreements are collateralized at all times, there is some risk to the Fund if the other party to the agreement should default on its obligations (repurchase agreement risk). The Fund’s investments in certain U.S. government agency securities may not be backed by the U.S. Treasury and may be supported only by the credit of the issuer (U.S. government agency securities risk). The Fund’s shareholders may be adversely impacted by asset allocation decisions made by the Fund’s investment adviser whose discretionary clients make up a large percentage of the Fund’s shareholders (large shareholder risk). The Fund’s exposure to these risks with respect to these financial assets held by the Fund is reflected in their value as recorded in the Fund’s Statement of Assets and Liabilities. The U.S. Securities and Exchange Commission (“SEC”) and other regulators may adopt additional money market fund regulations in the future, which may impact the operation and performance of the Fund (regulatory risk). The absence of an active market for the Fund’s variable and floating rate securities could make it difficult for the Fund to dispose of them if the issuer defaults (variable and floating rate instrument risk). The extent of the Fund’s exposure to these risks in respect to these financial assets is included in their value as recorded in the Fund’s Statement of Assets and Liabilities.

Please refer to the Fund’s prospectus for a complete description of the principal risks of investing in the Fund.

B. Indemnifications. Under the Trust’s organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the Fund, and shareholders are indemnified against personal liability for the obligations of the Trust. Additionally, in the normal course of business, the Fund enters into agreements with service providers that may contain indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss from such claims is considered remote.

6.   Money Market Regulation. Money market funds are required to comply with SEC regulations and governing rules for money market funds. Government money market funds, such as BBH U.S. Government Money Market Fund, are permitted to continue to transact fund shares at a NAV calculated using the

16

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

NOTES TO FINANCIAL STATEMENTS (continued)

April 30, 2024 (unaudited)

amortized cost valuation method. The Fund’s Board of Trustees has determined not to impose any liquidity-based redemption fees or redemption gates on the Fund as permitted by the SEC amendments. As a government money market fund, the Fund must invest 99.5% or more of its total assets in cash, short-term U.S. Treasury securities, U.S. government agency securities, and/or repurchase agreements that are collateralized fully by cash or government securities.

7.  Subsequent Events. Management has evaluated events and transactions that have occurred since April 30, 2024 through the date the financial statements were issued and determined that there were no subsequent events that would require recognition or additional disclosure in the financial statements.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

17

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

DISCLOSURE OF FUND EXPENSES

April 30, 2024 (unaudited)

EXAMPLE

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested distributions, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees, and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the six-months period and held for the entire period (November 1, 2023 to April 30, 2024).

ACTUAL EXPENSES

The first line of the table below provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during the period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% Hypothetical Example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

18

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

DISCLOSURE OF FUND EXPENSES (continued)

April 30, 2024 (unaudited)

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

Beginning
Account Value
November 1, 2023

  

Ending
Account Value
April 30, 2024

  

Expenses Paid
During Period
November 1, 2023 to
April 30, 20241

Institutional Shares

            

Actual

  

$1,000

  

$1,026

  

$1.11

Hypothetical2

  

$1,000

  

$1,024

  

$1.11

____________

​1   Expenses are equal to the Fund’s annualized net expense ratio of 0.22% for Institutional Shares, multiplied by 182/366 (to reflect the one half-year period).

​2   Assumes a return of 5% before expenses. For the purpose of the calculation, the applicable annualized expense ratio for each class of shares is subtracted from the assumed return before expenses.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

19

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

DISCLOSURE OF ADVISOR SELECTION

April 30, 2024 (unaudited)

Investment Advisory and Administrative Services Agreement Approval

The 1940 Act requires that a fund’s investment advisory agreements be approved annually by the fund’s board of trustees, including by a majority of the trustees who are not parties to the investment advisory agreements or “interested persons” of any party (“Independent Trustees”), cast in person at a meeting called for the purpose of voting on such approval.

The Board, a majority of which is comprised of Independent Trustees, held a telephonic meeting on November 16, 2023 and an in-person meeting on December 12, 2023, to consider whether to renew the combined Amended and Restated Investment Advisory and Administrative Services Agreement (the “Agreement”) between the Trust and the Investment Adviser with respect to the existing funds in the Trust, including the Fund. At the December 12, 2023 meeting, the Board voted to approve the renewal of the Agreement with respect to the Fund for an additional one-year term. In doing so, the Board determined that the terms of the Agreement were fair and reasonable and in the best interest of the Fund and its shareholders, and that it had received sufficient information to make an informed business decision with respect to the continuation of the Agreement.

Both in the meetings specifically held to address the continuance of the Agreement and at other meetings over the course of the year, the Board requested, received and assessed a variety of materials provided by the Investment Adviser and BBH, including, among other things, information about the nature, extent and quality of the services provided to the Fund by the Investment Adviser and BBH, including investment management, administrative and shareholder services, the oversight of Fund service providers, marketing, risk oversight, compliance, and the ability to meet applicable legal and regulatory requirements.

The Board also received comparative performance and fee and expense information for the Fund prepared by Broadridge Financial Solutions, Inc. using data from Lipper Inc. (“Lipper”), an independent provider of investment company data (“Lipper Report”). The Board reviewed this report with both counsel to the Trust (“Fund Counsel”) and BBH. The Board received from, and discussed with, Fund Counsel a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements under the 1940 Act, as well as the guidance provided in Gartenberg v. Merrill Lynch Asset Management, Inc., which was affirmed in Jones v. Harris Associates, L.P. In addition, the Board met in executive session outside the presence of Fund management.

The following is a summary of the factors the Board considered in making its determination to approve the continuance of the Agreement. No single factor reviewed by the Board was identified as the principal factor in determining whether to approve the Agreement, and individual Trustees may have given different weight to various factors. The Board reviewed these factors with Fund Counsel. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the comparative performance, expense information, the cost of the services provided and the profits realized by the Investment Adviser.

20

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Nature, Extent and Quality of Services

The Board noted that, under the Agreement and with respect to the Fund, the Investment Adviser, subject to the supervision of the Board, is responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Fund’s investment objective and policies. The Board further noted that, as a combined investment advisory and administration agreement, the Agreement also contemplates the provision of administrative services by the Investment Adviser to the Fund within the same fee structure. The Board received and considered information, during the December 12, 2023 meeting, and over the course of the previous year, regarding the nature, extent and quality of services provided to the Fund by BBH Investment Adviser including: portfolio management, supervision of operations and compliance, preparation of regulatory filings, disclosures to Fund shareholders, general oversight of service providers, organizing Board meetings and preparing the materials for such Board meetings, assistance to the Board, including the Independent Trustees in their capacity as Trustees, legal and Chief Compliance Officer services for the Trust, and other services necessary for the operation of the Fund. The Board considered the resources of the Investment Adviser and BBH, as a whole, dedicated to the Fund noting that, pursuant to separate agreements, BBH also provides custody, shareholder servicing, and fund accounting services to the Fund. The Board considered the depth and range of services provided pursuant to the Agreement, noting that the Investment Adviser also coordinates the provision of services to the Fund by affiliated and nonaffiliated service providers.

The Board considered the scope and quality of services provided by the Investment Adviser under the Agreement. The Board reviewed the qualifications of the key investment personnel primarily responsible for the day-to-day portfolio management of the Fund. The Board also considered the policies and practices followed by BBH and the Investment Adviser. The Board noted that, during the course of its regular meetings, it received reports on each of the foregoing topics. The Board concluded that, overall, they were satisfied with the nature, extent and quality of investment advisory and administrative services provided, and expected to be provided, to the Fund pursuant to the Agreement.

Fund Performance

At the November 16, 2032 and December 12, 2023 meetings, and throughout the year, the Board received and reviewed detailed performance information for the Fund. As part of this review, the Trustees considered the composition of the peer category, selection criteria and the reputation of Broadridge, who prepared the peer category analysis. The Board reviewed and discussed, with both BBH and Broadridge, the report’s findings and discussed the positioning of the Fund relative to its peer category. The Board considered short-term and long-term investment performance for the Fund over various periods of time as compared to a selection of peer funds, noting the Fund’s below average performance as compared to its peer category for the 1- and 2-year periods and average performance in the 3-, 4-, 5- and 10-year periods. In evaluating the performance of the Fund, the Board considered risk expectations for the Fund in light of relevant regulatory and market factors and in the context of Fund expenses and the Investment Adviser’s profitability.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

21

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

DISCLOSURE OF ADVISOR SELECTION (continued)

April 30, 2024 (unaudited)

Costs of Services Provided and Profitability

The Board considered the fee rates paid by the Fund to the Investment Adviser in light of the nature, extent and quality of the services provided to the Fund. The Board also considered and reviewed the voluntary fee waiver arrangement that was in place for the Fund and considered the actual fee rates, after taking into account the waiver. The Board received and considered information comparing the Fund’s combined investment advisory and administration fee and the Fund’s net operating expenses with those of other comparable mutual funds, such peer group and comparisons having been selected and calculated by Broadridge. The Board recognized that it was difficult to make comparisons of fee rates, or of combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds, as well as the timing of other funds’ transitions from prime money market funds to a government money market fund. The Board concluded that the advisory and administration fee appeared to be both reasonable in light of the services rendered and the result of arm’s length negotiations.

With regard to profitability, the Trustees considered the compensation and benefits flowing to the Adviser and BBH, directly or indirectly. The Board reviewed profitability data for the Fund using data from October 1, 2022 through September 30, 2023, for both the Investment Adviser and BBH and corresponding expenses. The data also included the effect of revenue generated by the shareholder servicing, custody and fund accounting fees paid by the Fund to BBH. The Board also reviewed the expense allocation methods used in preparing the profitability data. The Board focused on profitability of the Investment Adviser and BBH’s relationships with the Fund before taxes and distribution expenses. The Board concluded that the Investment Adviser and BBH’s profitability were not excessive in light of the nature, extent and quality of services provided to the Fund.

The Board also considered the effect of fall-out benefits to the Investment Adviser and BBH such as the increased visibility of BBH’s investment management business due to the distribution of the Trust’s funds. The Board considered other benefits received by BBH and the Investment Adviser as a result of their relationships with the Fund. These other benefits include fees received for being the Fund’s administrator, custodian, fund accounting and shareholder servicing agent. In light of the costs of providing services pursuant to the Agreement as well as the Investment Adviser and BBH’s commitment to the Fund, the ancillary benefits that the Investment Adviser and BBH received were considered reasonable.

Economies of Scale

The Board also considered the existence of economies of scale and whether those economies are passed along to the Fund’s shareholders through a graduated investment advisory fee schedule or other means, including any fee waivers by the Investment Adviser and BBH. The Board considered the fee schedule for the Fund, noting the existence of a graduated investment advisory fee and the voluntary fee waiver. Based on information they had been provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Fund, there appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints apply. In light of the Fund’s current size and expense structure, the Board concluded that the current breakpoints for the Fund were reasonable. The Board concluded that the fees paid by the Fund to the Investment Adviser were reasonable based on the comparative performance, expense information, the cost of the services provided and the profits to be realized by the Investment Adviser.

22

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

CONFLICTS OF INTEREST

April 30, 2024 (unaudited)

BBH&Co., including the Investment Adviser, provides discretionary and non-discretionary investment management services and products to corporations, institutions and individual investors throughout the world. As a result, in the ordinary course of its businesses, BBH&Co., including the Investment Adviser, may engage in activities in which its interests or the interests of its clients may conflict with or be adverse to the interests of the Funds. In addition, certain of such clients (including the Funds) utilize the services of BBH&Co. for which they will pay to BBH&Co. customary fees and expenses that will not be shared with the Funds.

The Investment Adviser and the Sub-advisers have adopted and implemented policies and procedures that seek to manage conflicts of interest. Pursuant to such policies and procedures, the Investment Adviser and each Sub-adviser monitor a variety of areas, including compliance with fund investment guidelines, the investment in only those securities that have been approved for purchase, and compliance with their respective Code of Ethics.

The Trust also manages these conflicts of interest. For example, the Trust has designated a CCO and has adopted and implemented policies and procedures designed to manage the conflicts identified below and other conflicts that may arise in the course of the Funds’ operations in such a way as to safeguard the Funds from being negatively affected as a result of any such potential conflicts. From time to time, the Trustees receive reports from the Investment Adviser, the Sub-advisers and the Trust’s CCO on areas of potential conflict.

Investors should carefully review the following, which describes potential and actual conflicts of interest that BBH&Co., the Investment Adviser and Sub-advisers can face in the operation of their respective investment management services. This section is not, and is not intended to be, a complete enumeration or explanation of all of the potential conflicts of interest that may arise. The Investment Adviser, the Sub-advisers and the Funds has adopted policies and procedures reasonably designed to appropriately prevent, limit or mitigate the conflicts of interest described below. Additional information about potential conflicts of interest regarding the Investment Adviser is set forth in the Investment Adviser’s Form ADV. A copy of Part 1 and Part 2A of the Investment Adviser’s Form ADV is available on the SEC’s website (www.adviserinfo.sec.gov). In addition, many of the activities that create these conflicts of interest are limited and/or prohibited by law, unless an exception is available.

Other Clients and Allocation of Investment Opportunities. BBH&Co., the Investment Adviser, and the Sub-advisers manage funds and accounts of clients other than the Funds (“Other Clients”). In general, BBH&Co., the Investment Adviser, and the Sub-advisers face conflicts of interest when they render investment advisory services to different clients and, from time to time, provide dissimilar investment advice to different clients. Investment decisions will not necessarily be made in parallel among the Funds and Other Clients. Investments made by the Funds do not, and are not intended to, replicate the investments, or the investment methods and strategies, of Other Clients. Accordingly, such Other Clients may produce results that are materially different from those experienced by the Funds. Certain other conflicts of interest may arise in connection with a portfolio manager’s management of the Funds’ investments, on the one hand, and the investments of other funds or accounts for which the portfolio

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

23

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

manager is responsible, on the other. For example, it is possible that the various funds or accounts managed by the Investment Adviser or Sub-advisers could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Funds. From time to time, the Investment Adviser and Sub-advisers, sponsor and with other investment pools and accounts which engage in the same or similar businesses as the Funds using the same or similar investment strategies. To the extent that the same investment opportunities might be desirable for more than one account or fund, possible conflicts could arise in determining how to allocate them because the Investment Adviser or Sub-advisers may have an incentive to allocate investment opportunities to certain accounts or funds. However, BBH&Co. and the Investment Adviser have implemented policies and procedures designed to ensure that information relevant to investment decisions is disseminated promptly within its portfolio management teams and investment opportunities are allocated equitably among different clients. The policies and procedures require, among other things, objective allocation for limited investment opportunities, and documentation and review of justifications for any decisions to make investments only for select accounts or in a manner disproportionate to the size of the account. Nevertheless, access to investment opportunities may be allocated differently among accounts due to the particular characteristics of an account, such as size of the account, cash position, tax status, risk tolerance and investment restrictions or for other reasons.

Actual or potential conflicts of interest may also arise when a portfolio manager has management responsibilities to multiple accounts or funds, resulting in unequal commitment of time and attention to the portfolio management of the funds or accounts.

Affiliated Service Providers. Other potential conflicts might include conflicts between the Funds and its affiliated and unaffiliated service providers (e.g., conflicting duties of loyalty). In addition to providing investment management services through the SID, BBH&Co. provides administrative, custody, shareholder servicing and fund accounting services to the Funds. BBH&Co. may have conflicting duties of loyalty while servicing the Funds and/or opportunities to further its own interest to the detriment of the Funds. For example, in negotiating fee arrangements with affiliated service providers, BBH&Co. may have an incentive to agree to higher fees than it would in the case of unaffiliated providers. BBH&Co. acting in its capacity as the Funds’ administrator is the primary valuation agent of the Funds. BBH&Co. values securities and assets in the Funds according to the Funds’ valuation policies. Because the Investment Adviser’s advisory and administrative fees are calculated by reference to a Funds’ net assets, BBH&Co. and its affiliates may have an incentive to seek to overvalue certain assets.

Aggregation. Potential conflicts of interest also arise with the aggregation of trade orders. Purchases and sales of securities for the Funds may be aggregated with orders for other client accounts managed by the Sub-advisers. The Sub-advisers, however, are not required to aggregate orders if portfolio management decisions for different accounts are made separately, or if it is determined that aggregating is not practicable, or in cases involving client direction. Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds will be charged or credited with the average price. Thus, the effect of the aggregation may operate on some occasions to the disadvantage of the Funds. In addition, under certain circumstances, the Funds will not be charged the same commission or commission equivalent rates in connection with an aggregated order.

24

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Cross Trades. Under certain circumstances, the Investment Adviser, on behalf of the Funds, may seek to buy from or sell securities to another fund or account advised by BBH, the Investment Adviser. Subject to applicable law and regulation, BBH&Co., the Investment Adviser may (but is not required to) effect purchases and sales between BBH&Co., the Investment Adviser clients (“cross trades”), including the Funds, if BBH&Co., the Investment Adviser or a Fund’s Sub-adviser believes such transactions are appropriate based on each party’s investment objectives and guidelines. There may be potential conflicts of interest or regulatory issues relating to these transactions which could limit the Investment Adviser’s decision to engage in these transactions for the Funds. BBH&Co., the Investment Adviser and/or a Fund’s Sub-adviser may have a potentially conflicting division of loyalties and responsibilities to the parties in such transactions.

Soft Dollars. The Investment Adviser may direct brokerage transactions and/or payment of a portion of client commissions (“soft dollars”) to specific brokers or dealers or other providers to pay for research or other appropriate services which provide, in the Investment Adviser’s view, appropriate assistance in the investment decision-making process (including with respect to futures, fixed price offerings and over-the-counter transactions). The use of a broker that provides research and securities transaction services may result in a higher commission than that offered by a broker who does not provide such services. The Investment Adviser will determine in good faith whether the amount of commission is reasonable in relation to the value of research and services provided and whether the services provide lawful and appropriate assistance in its investment decision-making responsibilities.

Research or other services obtained in this manner may be used in servicing any or all of the Funds and other accounts managed by the Investment Adviser, including in connection with accounts that do not pay commissions to the broker related to the research or other service arrangements. Such products and services may disproportionately benefit other client accounts relative to the Funds based on the amount of brokerage commissions paid by the Funds and such other accounts. To the extent that a Sub-adviser uses soft dollars, it will not have to pay for those products and services itself.

BBH&Co. may receive research that is bundled with the trade execution, clearing, and/or settlement services provided by a particular broker-dealer. To the extent that a Sub-adviser receives research on this basis, many of the same conflicts related to traditional soft dollars may exist. For example, the research effectively will be paid by client commissions that also will be used to pay for the execution, clearing, and settlement services provided by the broker-dealer and will not be paid by the Sub-adviser.

Arrangements regarding compensation and delegation of responsibility may create conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades, administration of investment advice and valuation of securities.

Investments in BBH Funds. From time to time BBH&Co. may invest a portion of the assets of its discretionary investment advisory clients in the Funds. That investment by BBH&Co. on behalf of its discretionary investment advisory clients in the Funds may be significant at times.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

25

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of scale that tend to reduce the Funds’ expense ratio. In selecting the Funds for its discretionary investment advisory clients, BBH&Co. may limit its selection to funds managed by BBH&Co. or the Investment Adviser. BBH&Co. may not consider or canvass the universe of unaffiliated investment companies available, even though there may be unaffiliated investment companies that may be more appropriate or that have superior performance. BBH&Co., the Investment Adviser and their affiliates providing services to the Funds benefit from additional fees when the Funds is included as an investment by a discretionary investment advisory client.

BBH&Co. reserves the right to redeem at any time some or all of the shares of the Funds acquired for its discretionary investment advisory clients’ accounts. A large redemption of shares of the Funds by BBH&Co. on behalf of its discretionary investment advisory clients could significantly reduce the asset size of the Funds, which might have an adverse effect on the Funds’ investment flexibility, portfolio diversification and expense ratio.

Valuation. When market quotations are not readily available or are believed by BBH&Co. to be unreliable, the Funds’ investments will be valued at fair value by BBH&Co. pursuant to procedures adopted by the Funds’ Board. When determining an asset’s “fair value,” BBH&Co. seeks to determine the price that a Fund might reasonably expect to receive from the current sale of that asset in an arm’s-length transaction. The price generally may not be determined based on what the Funds might reasonably expect to receive for selling an asset at a later time or if it holds the asset to maturity. While fair value determinations will be based upon all available factors that BBH&Co. deems relevant at the time of the determination and may be based on analytical values determined by BBH&Co. using proprietary or third-party valuation models, fair value represents only a good faith approximation of the value of a security. The fair value of one or more securities may not, in retrospect, be the price at which those assets could have been sold during the period in which the particular fair values were used in determining the Funds’ net asset value. As a result, the Funds’ sale or redemption of its shares at net asset value, at a time when a holding or holdings are valued by BBH&Co. (pursuant to Board-adopted procedures) at fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.

Referral Arrangements. BBH&Co. may enter into advisory and/or referral arrangements with third parties. Such arrangements may include compensation paid by BBH&Co. to the third party. BBH&Co. may pay a solicitation fee for referrals and/or advisory or incentive fees. BBH&Co. may benefit from increased amounts of assets under management.

Personal Trading. BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, face conflicts of interest when transacting in securities for their own accounts because they could benefit by trading in the same securities as the Funds, which could have an adverse effect on the Funds. However, the Investment Adviser has implemented policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policy and procedures are intended to prevent BBH&Co. Partners and employees from trading in the same securities as the Funds. However, BBH&Co., including the Investment Adviser, has implemented

26

    

 

BBH U.S. GOVERNMENT MONEY MARKET FUND

CONFLICTS OF INTEREST (continued)

April 30, 2024 (unaudited)

policies and procedures concerning personal trading by BBH&Co. Partners and employees. The policies and procedures are intended to prevent BBH&Co. Partners and employees with access to Fund material non-public information from trading in the same securities as the Funds.

Gifts and Entertainment. From time to time, employees of BBH&Co., including the Investment Adviser, and any of their respective partners, principals, directors, officers, employees, affiliates or agents, may receive gifts and/or entertainment from clients, intermediaries, or service providers to the Funds or BBH&Co., including the Investment Adviser, which could have the appearance of affecting or may potentially affect the judgment of the employees, or the manner in which they conduct business. The Investment Adviser has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees. BBH&Co., including the Investment Adviser, has implemented policies and procedures concerning gifts and entertainment to mitigate any impact on the judgment of BBH&Co. Partners and employees.

F I N A N C I A L   S T A T E M E N T S   A P R I L   3 0,   2 0 2 4

  

27

 

Administrator
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005

Distributor
Alps Distributors, Inc.
1290 Broadway, Suite 1000
Denver, Co 80203

Shareholder Servicing Agent
Brown Brothers Harriman & Co.
140 Broadway
New York, NY 10005
1-800-575-1265

To obtain information or make shareholder inquiries:

  

Investment Adviser
Brown Brothers Harriman
Mutual Fund Advisory Department
140 Broadway
New York, NY 10005

By telephone:
By E-mail send your request to:
On the internet:

  

Call 1-800-575-1265
bbhfunds@bbh.com
www.bbhfunds.com

This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund.

For more complete information, visit www.bbhfunds.com for a prospectus. You should consider the Fund’s investment objectives, risks, charges and expenses carefully before you invest. Information about these and other important subjects is in the Fund’s prospectus, which you should read carefully before investing.

Holdings and allocations are subject to change. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities. Current and future holdings are subject to risk.

The Fund’s Forms N-MFP are available electronically on the SEC’s website (sec.gov). For a complete list of a fund’s portfolio holdings, view the most recent holdings listing, semi-annual report, or annual report on the Fund’s web site at http://www.bbhfunds.com.

A summary of the Fund’s Proxy Voting Policy that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund’s portfolio, as well as a record of how the Fund voted any such proxies during the most recent 12-month period ended June 30, is available, without charge, upon request by calling the toll-free number listed above. This information is also available on the SEC’s website at www.sec.gov.

NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE

 

Item 2.       Code of Ethics.

Not required for this semi-annual report on Form N-CSR.

Item 3.       Audit Committee Financial Expert.

Not required for this semi-annual report on Form N-CSR.

Item 4.       Principal Accountant Fees and Services.

Not required for this semi-annual report on Form N-CSR.

Item 5.       Audit Committee of Listed Registrants.

Not required for this semi-annual report on Form N-CSR.

Item 6.       Investments.

(a)     A Schedule of Investments as of the close of the reporting period is included as part of the report to shareholders filed under Item 1 of this Form N-CSR.

(b)    Not applicable.

Item 7.       Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable to open-end investment companies.

Item 8.       Portfolio Managers of Closed-End Management Investment Companies.

Not applicable to open-end investment companies.

Item 9.       Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable to open-end investment companies.

Item 10.     Submission of Matters to a Vote of Security Holders.

Registrant does not have procedures by which shareholders may recommend nominees to its board of trustees.

Item 11.     Controls and Procedures.

(a)     The Registrant’s principal executive and financial officers have concluded that the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective, as of a date within 90 days of the filing date of this Form N-CSR, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

(b)    There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the Registrant’s second fiscal quarter of the period covered by this Form N-CSR, that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

Item 12.     Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.

Not applicable to open-end investment companies.

 

Item 13.     Exhibits.

(a)(1)

  

Not applicable.

(a)(2)

  

Certifications required by Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are filed as Exhibit 13(a)(2) to this Form N-CSR.

(a)(3)

  

Not applicable to open-end investment companies.

(a)(4)

  

There was no change in the Registrant’s independent public accountant for the period covered by this report.

(b)

  

Certifications required by Rule 30a-2(b) under the 1940 Act and Section 906 of the Sarbanes-Oxley Act of 2002 are furnished as Exhibit 13(b) to this Form N-CSR.

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant) BBH Trust

By:

  

(Signature and Title)

    
   

/s/ Daniel Greifenkamp

    
   

Daniel Greifenkamp

    
   

Title: President (Principal Executive Officer)

    
   

Date: June 24, 2024

    

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

By:

  

(Signature and Title)

    
   

/s/ Daniel Greifenkamp

    
   

Daniel Greifenkamp

    
   

Title: President (Principal Executive Officer)

    
   

Date: June 24, 2024

    

By:

  

(Signature and Title)

    
   

/s/ Charles H. Schreiber

    
   

Charles H. Schreiber

    
   

Title: Treasurer (Principal Financial Officer)

    
   

Date: June 24, 2024