-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FlbJ8YmLbNYRNrX8EBLL0GkGSWbbQfFJs2C7ZpNF7fzUtaPEfR7d+X2CJLo4lApt OOo96DvVEq7AG5Q7IlmEDA== 0000935069-01-500116.txt : 20010507 0000935069-01-500116.hdr.sgml : 20010507 ACCESSION NUMBER: 0000935069-01-500116 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010228 FILED AS OF DATE: 20010504 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RBB FUND INC CENTRAL INDEX KEY: 0000831114 STANDARD INDUSTRIAL CLASSIFICATION: [] FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-05518 FILM NUMBER: 1622081 BUSINESS ADDRESS: STREET 1: 400 BELLEVUE PKWY STE 100 CITY: WILMINGTON STATE: DE ZIP: 19809 BUSINESS PHONE: 3027911791 MAIL ADDRESS: STREET 1: 103 BELLEVUE PKWY STREET 2: SUITE 152 CITY: WILMINGTON STATE: DE ZIP: 19809 FORMER COMPANY: FORMER CONFORMED NAME: FUND INC /DE/ DATE OF NAME CHANGE: 19600201 N-30D 1 w01-0366.txt MORGAN KEEGAN MOR 2001 SAR (LOGO) MORGAN KEEGAN MOR ACCOUNT [GRAPHIC OMITTED] SEMI-ANNUAL REPORT FOR BEDFORD SHARES FEBRUARY 28, 2001 MONEY MARKET PORTFOLIO MUNICIPAL MONEY MARKET PORTFOLIO GOVERNMENT OBLIGATIONS MONEY MARKET PORTFOLIO THE BEDFORD FAMILY THE RBB FUND, INC. SEMI-ANNUAL INVESTMENT ADVISER'S REPORT The impact of the Federal Reserve's restrictive monetary policy became evident in the second half of 2000 as the nation's gross domestic product (GDP) decelerated to 2.2% in the third quarter and to just 1% in the fourth quarter. This marked a sharp slowdown from the 5.2% rate of growth in the first half of 2000. Consumer spending, which accounts for two thirds of GDP, led the slowdown as the year ended. Consumer confidence also weakened in reaction to the spike in energy prices earlier in the year and the extent of the decline in stock market valuations. Finally, corporate profits also deteriorated over the course of the year and earnings short-falls and warning announcements became the norm, well into the first quarter of 2001. The Federal Reserve maintained its tight monetary policy during all of 2000, although no further rate increases were made after the decision in May to raise the federal funds rate to 6.5%. The most dramatic change in the money markets during the last six months was the steep inversion of the yield curve. As sentiment swung toward a more accommodative Fed, yields on one-year securities fell from over 7.25% to 6% at year-end. In early January, the Fed took the unusual step of cutting rates in between regularly scheduled meetings by fifty basis points. Their rationale was that a deepening weakness in overall business activity was now a greater threat to the economy than an imminent rekindling of inflation. At the end of January, the Fed again eased aggressively. A second fifty basis point cut pushed money market yields sharply lower and kept the yield curve steeply inverted. By late February, the market was poised for additional Fed easings of at least 50-100 basis points. The average weighted maturities of the RBB Money Market and Government Money Market Portfolios were shortened during the period, as the yield curve inverted and offered little incentive to buy longer-dated obligations. At the end of February, both portfolios had 37-day average weighted maturities. Assets in RBB Money Market were $1.08 billion and RBB Government was $137 million. The municipal money markets saw yields decline over the last two quarters, in tandem with the Fed's rate cuts. Supply and demand also had a strong impact on tax-exempt yields. The fourth quarter of 2000, for example, experienced some of the highest yields of the year as dealer inventories were cleared out before year-end. Assets continued to pour into tax-exempt money funds during the period as the stock market sell-off pumped new cash into the market. Credit quality also became a growing concern during the last six months. The problems with certain California utilities and the health of the Japanese banking system were two widely publicized issues that helped reiterate the importance of high quality investments. RBB Municipal Money Market Portfolio ended February with a 33-day average weighted maturity and assets of $145 million. BlackRock Institutional Management Corporation (Please dial toll-free 800-430-9618 for questions regarding your account or contact your broker.) THE BEDFORD FAMILY THE RBB FUND, INC. MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS FEBRUARY 28, 2001 (UNAUDITED) PAR (000) VALUE ------- -------------- CERTIFICATES OF DEPOSIT--11.4% DOMESTIC CERTIFICATES OF DEPOSIT--3.0% American Express Centurion Bank 5.500% 03/23/01 ............................. $20,000 $ 20,000,000 Wilmington Trust Company 5.410% 07/23/01 ............................. 12,500 12,500,000 -------------- 32,500,000 -------------- YANKEE DOLLAR CERTIFICATES OF DEPOSIT--8.4% Bank of Montreal 5.500% 03/23/01 ............................. 25,000 25,000,000 Merita Bank Ltd NY Branch 5.405% 06/11/01 ............................. 25,000 25,000,346 5.330% 06/15/01 ............................. 6,000 6,000,000 Natexis Banque Populaires S.A. 5.330% 07/09/01 ............................. 35,000 35,000,000 -------------- 91,000,346 -------------- TOTAL CERTIFICATES OF DEPOSIT (Cost $123,500,346) ..................... 123,500,346 -------------- COMMERCIAL PAPER--47.1% ASSET BACKED SECURITIES--21.7% Amstel Funding Corp. 5.300% 05/04/01 ............................. 30,000 29,717,333 Crown Point Capital Co. 5.510% 04/18/01 ............................. 18,000 17,867,760 Emerald Certificates Program 5.740% 03/16/01 ............................. 12,000 11,971,300 Fairway Finance Ltd. 5.500% 03/19/01 ............................. 35,000 34,903,750 K2 (USA) LLC 6.460% 04/17/01 ............................. 12,000 11,898,793 5.250% 06/12/01 ............................. 19,000 18,714,604 Moriarty Ltd. 5.520% 04/23/01 ............................. 40,000 39,674,933 New Castle Certificates Program 5.450% 04/05/01 ............................. 33,000 32,825,146 5.340% 05/11/01 ............................. 5,000 4,947,342 5.320% 05/16/01 ............................. 7,000 6,921,382 Sheffield Receivables Corp. 5.490% 03/13/01 ............................. 25,000 24,954,250 -------------- 234,396,593 -------------- PAR (000) VALUE ------- -------------- BANKS--10.6% Banque Generale Du Luxembourg 5.390% 04/30/01 ............................. $10,000 $ 9,910,167 DEPFA-Bank Europe PLC. 6.480% 04/16/01 ............................. 20,000 19,834,400 5.210% 07/20/01 ............................. 20,000 19,591,883 HSBC USA Inc. 6.671% 03/09/01 ............................. 35,000 34,948,114 Swedbank 6.400% 04/12/01 ............................. 30,000 29,776,000 -------------- 114,060,564 -------------- CHEMICALS & ALLIED PRODUCTS--2.4% BASF (AG) 6.440% 03/19/01 ............................. 12,000 11,961,360 6.430% 04/05/01 ............................. 14,500 14,409,355 -------------- 26,370,715 -------------- GOVERNMENT--1.4% Quebec, Province of 6.400% 03/23/01 ............................. 15,000 14,941,333 -------------- MISCELLANEOUS BUSINESS CREDIT INSTITUTIONS--1.8% National Rural Utility Cooperative Finance Corp. 6.410% 04/26/01 ............................. 20,000 19,800,578 -------------- NATURAL GAS TRANS. & DISTR.--1.4% Consolidated Natural Gas Co. 5.580% 04/30/01 ............................. 15,000 14,860,500 -------------- PETROLEUM REFINING--0.9% Repsol International Finance BV 6.570% 03/05/01 ............................. 10,000 9,992,700 -------------- SECURITY BROKERS & DEALERS--6.9% Goldman Sachs Group, Inc. (The) 5.580% 03/01/01 ............................. 50,000 50,000,000 Lehman Brothers Holdings Inc. 6.470% 04/12/01 ............................. 10,000 9,924,517 6.400% 06/01/01 ............................. 15,000 14,754,667 -------------- 74,679,184 -------------- TOTAL COMMERCIAL PAPER (Cost $509,102,167) ..................... 509,102,167 -------------- See Accompanying Notes to Financial Statements. 2 THE BEDFORD FAMILY THE RBB FUND, INC. MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) PAR (000) VALUE ------- -------------- AGENCY OBLIGATIONS--2.0% Federal Home Loan Bank 5.000% 06/29/01 ............................. $10,000 $ 9,833,333 Federal National Mortgage Association 4.860% 08/16/01 ............................. 12,000 11,727,840 -------------- TOTAL AGENCY OBLIGATIONS (Cost $21,561,173) ...................... 21,561,173 -------------- MUNICIPAL BONDS--6.1% FLORIDA--0.2% Coral Springs VRDN IDR (Alliance Corp.) (Suntrust Bank, Central FL LOC) Series 1995+ 5.650% 03/07/01 ............................. 2,000 2,000,000 -------------- GEORGIA--0.8% De Kalb County Development Authority VRDN Series 1995 B (Emory University Project)+ 5.500% 03/07/01 ............................. 8,880 8,880,000 -------------- ILLINOIS--0.4% Illinois Health Facilities Authority VRDN (The Streeterville Corp. Project) Series 1993-B (Bank One N.A. LOC)+ 5.400% 03/07/01 ............................. 4,400 4,400,000 -------------- INDIANA--0.1% Bremen IDR Bond VRDN Series 1996 B (Society National Bank, Cleveland)+ 5.650% 03/01/01 ............................. 1,350 1,350,000 -------------- KENTUCKY--0.4% Boone County Taxable IDR Refunding Bonds VRDN (Square D Company Project) Series 1994-B (Societe Generale LOC)+ 5.400% 03/07/01 ............................. 4,200 4,200,000 -------------- MISSISSIPPI--2.2% Mississippi Business Finance Corp., IDR Bond VRDN (Bryan Foods, Inc. Project) Series 1994 (Sara Lee Corp. LOC)+ 5.450% 03/07/01 ............................. 14,000 14,000,000 PAR (000) VALUE ------- -------------- MISSISSIPPI--(CONTINUED) Mississippi Business Finance Corp., IDR Bond VRDN (Choctaw Foods Inc. Project) Series1995 (Rabobank Nederland LOC)+ 5.650% 03/07/01 ............................. $ 4,600 $ 4,600,000 Mississippi Business Finance Corp., IDR Bond VRDN (Dana Lighting Inc.) Series 1995 (Suntrust Bank, Central FL LOC)+ 5.650% 03/07/01 ............................. 4,900 4,900,000 -------------- 23,500,000 -------------- NORTH CAROLINA--0.6% City of Asheville VRDN (Wachovia Bank LOC)+ 5.500% 03/07/01 ............................. 7,000 7,000,000 -------------- TEXAS--1.4% South Central Texas Industrial Development Corp. Taxable IDR Revenue Bond VRDN (Rohr Industries Project) Series 1990 (NBD Bank N.A. LOC)+ 5.400% 03/07/01 ............................. 14,800 14,800,000 -------------- TOTAL MUNICIPAL BONDS (Cost $66,130,000) ...................... 66,130,000 -------------- VARIABLE RATE OBLIGATIONS--18.6% BANKS--9.8% American Express Centurion Bank++ 5.670% 03/01/01 ............................. 21,000 21,000,000 Bank of America N.T.S.A.++ 5.670% 03/01/01 ............................. 50,000 50,000,000 First Union National Bank++ 5.550% 03/09/01 ............................. 15,000 15,000,000 5.550% 03/26/01 ............................. 20,000 20,000,000 -------------- 106,000,000 -------------- LIFE INSURANCE--3.7% Transamerica Life Insurance & Annuity Co., GIC++ 6.720% 03/01/01 ............................. 40,000 40,000,000 -------------- See Accompanying Notes to Financial Statements. 3 THE BEDFORD FAMILY THE RBB FUND, INC. MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONCLUDED) FEBRUARY 28, 2001 (UNAUDITED) PAR (000) VALUE ------- -------------- SECURITY BROKERS & DEALERS--5.1% Merrill Lynch & Co. Inc.++ 5.368% 05/14/01 ............................. $40,000 $ 40,002,601 Salomon Smith Barney Holdings Inc.++ 5.926% 04/06/01 ............................. 15,000 15,008,873 -------------- 55,011,474 -------------- TOTAL VARIABLE RATE OBLIGATIONS (Cost $201,011,474) ..................... 201,011,474 -------------- TIME DEPOSITS--14.6% Suntrust Bank Atlanta 5.563% 03/01/01 ............................. 157,500 157,500,000 -------------- TOTAL TIME DEPOSITS (Cost $157,500,000) ..................... 157,500,000 -------------- TOTAL INVESTMENTS AT VALUE--99.8% (Cost $1,078,805,160*) ...................... 1,078,805,160 -------------- OTHER ASSETS IN EXCESS OF LIABILITIES--0.2% ........................ 1,794,027 -------------- NET ASSETS--100.0% ............................. $1,080,599,187 ============== * Also cost for Federal income tax purposes. + Variable Rate Demand Note -- The interest rate shown is the rate as of February 28, 2001 and the maturity date shown is the longer of the next interest rate readjustment date or the date the principal amount shown can be recovered through demand. ++ Variable Rate Obligations -- The interest rate shown is the rate as of February 28, 2001 and the maturity date shown is the next interest rate readjustment date or the maturity date. INVESTMENT ABBREVIATIONS GIC ..............................................Guaranteed Investment Contract IDR ..............................................Industrial Development Revenue LOC ............................................................Letter of Credit VRDN ..................................................Variable Rate Demand Note See Accompanying Notes to Financial Statements. 4 THE BEDFORD FAMILY THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS FEBRUARY 28, 2001 (UNAUDITED) PAR (000) VALUE ------ ------------ MUNICIPAL BONDS--99.1% ALABAMA--3.7% Columbia IDA PCR RB AMT Series 1998 DN (South Trust Bank LOC)+ 3.250% 03/01/01 ............................. $3,700 $ 3,700,000 Tuscaloosa County IDA RB Series DN AMT 2000 A (SouthTrust Bank LOC)+ 3.720% 03/07/01 ............................. 1,640 1,640,000 ------------ 5,340,000 ------------ FLORIDA--1.4% Putnam County Development Authority PCR RB (National Rural Utilities Co-op Seminole Electric Project) Series H 1984 MB++ 4.150% 03/15/01 ............................. 2,000 2,000,000 ------------ GEORGIA--4.3% Atlanta Water & Wastewater RB Municipal Trust Certificate Series ZTC-4 MB++ 4.400% 05/01/01 ............................. 3,205 3,205,000 Forsyth County Development Authority DN (SunTrust Bank LOC)+ 3.500% 03/07/01 ............................. 3,000 3,000,000 ------------ 6,205,000 ------------ HAWAII--1.4% Hawaii State Housing Finance & Development Corporation Rental Housing System RB DN Series 1990 B (Ind. Bank of Japan LOC)+ 4.000% 03/07/01 ............................. 2,000 2,000,000 ------------ ILLINOIS--14.1% Addison, Village Of, Dupage County, IDA RB AMT (General Binding Corp. Project) 1988 DN (ABN AMRO Bank LOC)+ 3.550% 03/07/01 ............................. 1,450 1,450,000 Chicago O'Hare International Airport RB AMT DN Series ZTC 8+ 3.670% 03/07/01 ............................. 4,980 4,980,000 PAR (000) VALUE ------ ------------ ILLINOIS--(CONTINUED) Chicago Skyway Toll Bridge RB Municipal Trust Certificate ZTC 3 DN (Ambac Insurance, ZCM Matched Funding)+ 3.570% 03/07/01 ............................. $1,665 $ 1,665,000 Chicago, City Of, IDA RB AMT (Goose Island Beer O. Project) DN (ABN AMRO Bank LOC)+ 3.870% 03/07/01 ............................. 1,900 1,900,000 East Dundee, Kane and Cook Counties, IDA RB AMT (Otto Engine Project) (ABN AMRO Bank LOC) DN+ 3.600% 03/07/01 ............................. 900 900,000 Illinois Development Finance Authority PCR RB (Illinois Power Company Project) (ABN AMRO Bank LOC) MB++ 3.300% 04/17/01 ............................. 2,000 2,000,000 Illinois Development Finance Authority Multifamily RB DN P Floats Pt-515 (Merrill Lynch & Co. Inc. LOC)+ 3.870% 03/07/01 ............................. 1,500 1,500,000 Illinois Health Facilities Authority Revolving Fund Pooled Financing Program (The University of Chicago Project) MB++ 4.350% 03/07/01 ............................. 4,100 4,100,000 Illinois Metropolitan Pier Expo Authority Eagle Tax-Exempt Trust Series 20001306 DN (FGIC Insurance)+ 3.570% 03/07/01 ............................. 1,000 1,000,000 Illinois State Sales Tax RB Series O (Escrowed To Maturity in U.S. Treasuries) MB++ 6.000% 02/28/01 ............................. 1,000 1,004,646 ------------ 20,499,646 ------------ INDIANA--5.9% Bremen IDA RB Series 1996 A (Universal Bearings, Inc. Project Private Placement) DN (Keybank LOC)+ 3.800% 03/07/01 ............................. 3,100 3,100,000 Indiana Development Finance Authority IDA RB (Enterprise Center II Project) DN (Bank One Illinois Key Bank LOC)+ 3.400% 03/07/01 ............................. 3,000 3,000,000 See Accompanying Notes to Financial Statements. 5 THE BEDFORD FAMILY THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) PAR (000) VALUE ------ ------------ INDIANA--(CONTINUED) Indiana State Development Finance Authority Economic Development AMT RB DN (Saroyan Hardwoods Inc. Project) (Bank One Funding Corp. LOC)+ 3.750% 03/07/01 ............................. $1,400 $ 1,400,000 Indiana State Educational Facilities Authority BAN Series 2000B 4.850% 05/03/01 ............................. 1,000 1,000,584 ------------ 8,500,584 ------------ KENTUCKY--6.1% Henderson Industrial Building RB AMT (Shamrock Technologies) 1997 DN (First Union National Bank LOC)+ 3.750% 03/07/01 ............................. 2,581 2,581,000 Jefferson County (Atlas Manufacturing Industrial Building) RB AMT Series 1999 DN (Bank One Kentucky LOC)+ 3.750% 03/07/01 ............................. 4,200 4,200,000 Kentucky Interlocal School Transportation Association TRAN Series 2000 5.000% 06/29/01 ............................. 2,000 2,003,776 ------------ 8,784,776 ------------ MARYLAND--2.1% Maryland State Economic Development Corp. RB AMT (John Schmitz & Sons Inc. Project) DN (Allfirst Bank LOC)+ 3.670% 03/07/01 ............................. 3,000 3,000,000 ------------ MASSACHUSETTS--2.6% Freetown Lakeville School District BAN Series 2001 3.500% 07/06/01 ............................. 3,000 3,001,489 Massachusetts State Health & Educational Facilities Authority RB Berklee College of Music DN (SBPA Credit Suisse LOC)+ 2.900% 03/07/01 ............................. 700 700,000 ------------ 3,701,489 ------------ PAR (000) VALUE ------ ------------ MICHIGAN--6.4% Michigan State Strategic Fund Saginaw Pro Limited Obligation RB Series 2001 AMT DN (Comerica Bank Detroit LOC)+ 3.850% 03/07/01 ............................. $3,500 $ 3,500,000 Michigan State Strategic Fund Limited AMT DN (Banc One LOC)+ 3.750% 03/07/01 ............................. 1,700 1,700,000 Michigan State Strategic Fund Limited Obligation RB Series 2000 AMT DN (Comerica Bank LOC)+ 3.650% 03/07/01 ............................. 3,000 3,000,000 Oakland County Economic Development Corp. Glass & Mirror Limited Obligation RB Series 2000 AMT DN (Banc One LOC)+ 3.650% 03/07/01 ............................. 1,200 1,200,000 ------------ 9,400,000 ------------ MINNESOTA--1.8% Minneapolis GO Notes DN (Bayerische Landesbank Girozentrale LOC)+ 3.350% 03/07/01 ............................. 300 300,000 Minneapolis GO Bonds Series 2000 A DN (Bayerische Landesbank Girozentrale LOC)+ 3.350% 03/07/01 ............................. 600 600,000 Minneapolis GO Judgment Bonds Series 2000 DN (Bayerische Landesbank Girozentrale LOC)+ 3.350% 03/07/01 ............................. 1,000 1,000,000 Minneapolis GO Bonds Series 1999 (Convention Center Project) DN (Bayerische Hypo-Uno Vereinsbank LOC)+ 3.350% 03/07/01 ............................. 550 550,000 Minneapolis GO Bonds Series 1994 A DN (Bayerische Landesbank Girozentrale LOC)+ 3.350% 03/07/01 ............................. 150 150,000 ------------ 2,600,000 ------------ See Accompanying Notes to Financial Statements. 6 THE BEDFORD FAMILY THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) PAR (000) VALUE ------ ------------ MISSOURI--1.3% Maries County IDA RB (Kingsford) Tax-Exempt Adjustable Mode Solid Waste Series 1993 DN (Clorox LOC)+ 3.650% 03/07/01 ............................. $1,900 $ 1,900,000 ------------ NEBRASKA--2.6% Lancaster County IDA RB AMT (Sun-Husker Foods, Inc. Project) DN (Bank of Tokyo LOC)+ 6.500% 03/07/01 ............................. 3,800 3,800,000 ------------ NEW JERSEY--0.7% Aberdeen Township BAN 4.900% 08/16/01 ............................. 1,000 1,001,980 ------------ NEW YORK--4.4% New York City Housing Development Corp. Multi-Family Rental Housing RB DN (FNMA LOC)+ 3.000% 03/07/01 ............................. 200 200,000 New York State Housing Finance Agency (750 Sixth Avenue Housing) RB AMT DN Series 1999 A (FNMA LOC)+ 3.050% 03/07/01 ............................. 1,250 1,250,000 New York State Local Government Assistance Corp. RB Series 1991 A (Pre refunded) MB++ 7.125% 03/07/01 ............................. 3,000 3,087,403 Ulster County IDA RB 1998A AMT (Viking Industries, Inc. Project) DN (Key Corp. Bank N.A. LOC)+ 3.460% 03/07/01 ............................. 1,845 1,845,000 ------------ 6,382,403 ------------ NORTH CAROLINA--4.2% Gates County Industrial Facilities PCR RB AMT (Coxe-Lewis Project) DN (First Union National Bank LOC)+ 3.750% 03/07/01 ............................. 1,760 1,760,000 Green County Industrial Facilities PCR RB DN (Wachovia LOC)+ 3.600% 03/07/01 ............................. 500 500,000 PAR (000) VALUE ------ ------------ NORTH CAROLINA--(CONTINUED) Guilford County Industrial Facilities PCR RB DN Series 2000 (Bank of America LOC)+ 3.650% 03/07/01 ............................. $ 800 $ 800,000 Iredell County Industrial Facilities PCR RB (B and B Fabricators Project) Series 1999 DN (Bank America N.A. LOC)+ 3.650% 03/07/01 ............................. 1,000 1,000,000 Lee County Industrial Facilities PCR RB AMT (Var-Arden Corp Project) Series 1999 DN (Comerica Bank Detroit LOC)+ 3.650% 03/07/01 ............................. 200 200,000 Wilkes County Industrial Facilities PCR RB AMT (Schas Circular Industries, Inc. Project) Series 1997A DN (Marine Midland LOC)+ 3.500% 03/07/01 ............................. 1,800 1,800,000 ------------ 6,060,000 ------------ OHIO--10.7% Cuyahoga County (Cleveland Gear) IDA RB AMT DN Series 1998 (Key Corp. Bank N.A. LOC)+ 3.460% 03/07/01 ............................. 800 800,000 Forest Park BAN Series 2000 5.260% 10/11/01 ............................. 1,200 1,205,708 Indian Hill Village Economic Development RB DN Series 1999 (Fifth Third Bank LOC)+ 3.250% 03/07/01 ............................. 1,000 1,000,000 Jefferson County BAN Series 2000 4.980% 11/15/01 ............................. 2,000 2,002,434 Lebanon BAN Series 2001 Fourth Renewal 3.850% 06/07/01 ............................. 1,000 1,001,000 Nordonia Hills BAN Series A 4.750% 03/20/01 ............................. 1,000 1,000,231 North Olmsted BAN Series 2001 3.750% 07/31/01 ............................. 1,000 1,002,687 Ohio State University TECP Series 1999B 4.100% 04/09/01 ............................. 2,500 2,500,000 See Accompanying Notes to Financial Statements. 7 THE BEDFORD FAMILY THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) PAR (000) VALUE ------ ------------ OHIO--(CONTINUED) Olmsted Falls BAN Series 2000 4.700% 10/26/01 ............................. $ 650 $ 651,017 Perry County BAN Series 2000 4.750% 04/20/01 ............................. 1,385 1,385,648 Sidney City School District BAN Series 2001 3.920% 08/07/01 ............................. 1,000 1,002,247 Trumbull County IDA RB Series 1995 DN (Society National Bank LOC)+ 3.460% 03/07/01 ............................. 2,030 2,030,000 ------------ 15,580,972 ------------ OKLAHOMA--0.9% Oklahoma County Finance Authority IDA RB AMT (Southwest Electric Co. Project) Series 1998 DN (Bank One Oklahoma LOC)+ 3.750% 03/07/01 ............................. 1,320 1,320,000 ------------ PUERTO RICO--0.1% Puerto Rico Government Development Bank Series 1985 DN (MBIA Insurance; Credit Suisse SBPA)+ 1.900% 03/07/01 ............................. 100 100,000 ------------ SOUTH CAROLINA--1.5% Charleston County GO Bonds Series 2001B MB++ 6.500% 03/07/01 ............................. 1,200 1,233,425 Lexington County School District TAN Series 2000 5.000% 04/12/01 ............................. 1,000 1,000,717 ------------ 2,234,142 ------------ TENNESSEE--5.7% City of Jackson IDA RB (Quadion Corporation Project) AMT DN (Suntrust Bank, N.A. LOC)+ 3.650% 03/07/01 ............................. 2,600 2,600,000 Morristown IDA AMT (Petoskey Plastic Project) DN (Comerica Bank LOC)+ 3.750% 03/07/01 ............................. 5,735 5,735,000 ------------ 8,335,000 ------------ PAR (000) VALUE ------ ------------ TEXAS--10.5% Austin Airport System Revenue Financial Sevices Department AMT First Union 2A-7 Merlots Series 2000 J (MBIA Insurance) DN+ 3.350% 03/07/01 ............................. $3,000 $ 3,000,000 Austin Electric Utility RB DN (Financial Security Assurance LOC)+ 3.560% 03/07/01 ............................. 1,000 1,000,000 Denton IDA AMT (Hartzell Manufacturing Inc. Project) DN (National City Bank of Cleveland LOC)+ 3.800% 03/07/01 ............................. 1,300 1,300,000 Haltom City IDA RB AMT DN 1995 (ABN AMRO LOC)+ 3.280% 03/07/01 ............................. 1,000 1,000,000 Harris County Sub Lien Toll Road Service RB AMT DN Series 1994-C (Morgan Guaranty LOC)+ 3.100% 03/07/01 ............................. 300 300,000 Harris County Toll Road Unlimited Tax RB Series 4F DN (Morgan Guaranty LOC)+ 3.100% 03/07/01 ............................. 200 200,000 Port Arthur Navigation District Environmental Facilities RB (Motiva Enterprises Project) DN+ 3.450% 03/07/01 ............................. 2,500 2,500,000 Texas State Municipal Trust Certification ZTC 5 College Student Loan RB AMT DN Series 2000 (ZCM Matched Funding LOC)+ 3.670% 03/07/01 ............................. 5,990 5,990,000 ------------ 15,290,000 ------------ UTAH--0.6% Salt Lake City Flexible Rate RB DN (Pooled Hospital Financing Program) (West Landesbank LOC)+ 3.150% 03/07/01 ............................. 900 900,000 ------------ See Accompanying Notes to Financial Statements. 8 THE BEDFORD FAMILY THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONCLUDED) FEBRUARY 28, 2001 (UNAUDITED) PAR (000) VALUE ------ ------------ VIRGINIA--3.5% Dinwiddie County IDA RB AMT DN (Chaparrel Facility) Series 1999A (Bank of America LOC)+ 3.250% 03/07/01 ............................. $ 700 $ 700,000 Metro Washington DC Airport Authority AMT TECP 3.250% 07/13/01 ............................. 4,000 4,000,000 Smyth County IDA RB (Summit Properties Project) AMT DN (Fifth Third Bank LOC)+ 3.700% 03/07/01 ............................. 400 400,000 ------------ 5,100,000 ------------ WASHINGTON--0.7% Port Seattle RB Series D MB++ 5.500% 02/01/02 ............................. 1,000 1,019,344 ------------ WISCONSIN--1.2% Beloit School District TRAN Series 2000 4.550% 10/26/01 ............................. 500 500,157 Mequon, City of, IDA RB AMT (Johnson Level GRW Investment Project) DN (Bank One Wisconsin LOC)+ 3.750% 03/07/01 ............................. 1,180 1,180,000 ------------ 1,680,157 ------------ WYOMING--0.7% Wyoming County Development Authority Housing RB 1999 Series 5 MB++ 4.250% 08/01/01 ............................. 1,000 1,000,249 ------------ TOTAL MUNICIPAL BONDS (Cost $143,735,742) ..................... 143,735,742 ------------ TOTAL INVESTMENTS AT VALUE--99.1% (Cost $143,735,742*) ........................ 143,735,742 ------------ OTHER ASSETS IN EXCESS OF LIABILITIES--0.9% ........................ 1,331,693 ------------ NET ASSETS--100.0% ............................. $145,067,435 ============ * Also cost for Federal income tax purposes. + Variable Rate Demand Notes -- The interest rate shown is the rate as of February 28, 2001 and the maturity date shown is the longer of the next interest readjustment date or the date the principal amount shown can be recovered through demand. ++ Put Bonds -- Maturity date is the put date. INVESTMENT ABBREVIATIONS AMT .....................................................Alternative Minimum Tax BAN ......................................................Bond Anticipation Note DN ..................................................................Demand Note GO ..........................................................General Obligations LOC ............................................................Letter of Credit IDA ............................................Industrial Development Authority MB ...............................................................Municipal Bond PCR ...................................................Pollution Control Revenue RAN ...................................................Revenue Anticipation Note RAW ...............................................Revenue Anticipation Warrants RB .................................................................Revenue Bond TAN .......................................................Tax Anticipation Note TECP ................................................Tax Exempt Commercial Paper TRAN ..........................................Tax and Revenue Anticipation Note ZTC ....................................................Zurich Trust Certificate See Accompanying Notes to Financial Statements. 9 THE BEDFORD FAMILY THE RBB FUND, INC. GOVERNMENT OBLIGATIONS MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS FEBRUARY 28, 2001 (UNAUDITED) PAR (000) VALUE ------- ------------ AGENCY OBLIGATIONS--32.5% FEDERAL FARM CREDIT BANK--1.5% 6.100% 09/24/01 ............................. $ 2,000 $ 2,011,907 ------------ FEDERAL HOME LOAN BANK--5.4% 6.100% 03/07/01 ............................. 4,000 3,995,933 6.110% 03/14/01 ............................. 3,000 2,993,381 5.500% 08/13/01 ............................. 515 515,986 ------------ 7,505,300 ------------ FEDERAL HOME LOAN MORTGAGE CORPORATION--11.4% 5.520% 03/09/01 ............................. 2,000 1,997,547 5.380% 04/26/01 ............................. 5,000 4,958,156 5.100% 07/19/01 ............................. 3,000 2,940,500 5.030% 07/20/01 ............................. 3,300 3,234,987 6.520% 01/02/02 ............................. 2,585 2,616,381 ------------ 15,747,571 ------------ FEDERAL NATIONAL MORTGAGE ASSOCIATION--14.2% 6.160% 03/01/01 ............................. 3,690 3,690,000 6.290% 04/19/01 ............................. 5,000 4,957,193 5.370% 04/26/01 ............................. 5,000 4,958,233 5.175% 05/10/01 ............................. 3,000 2,969,813 4.780% 01/11/02 ............................. 3,000 2,874,127 ------------ 19,449,366 ------------ TOTAL AGENCY OBLIGATIONS (Cost $44,714,144) 44,714,144 ------------ VARIABLE RATE OBLIGATIONS--34.8% FEDERAL HOME LOAN BANK--7.3% 5.430% 04/12/01+ ............................ 5,000 4,997,896 5.519% 04/19/01+ ............................ 5,000 4,997,831 ------------ 9,995,727 ------------ FEDERAL NATIONAL MORTGAGE ASSOCIATION--5.8% 6.536% 03/05/01+ ............................ 5,000 4,998,535 5.970% 04/04/01+ ............................ 3,000 2,998,863 ------------ 7,997,398 ------------ PAR (000) VALUE ------- ------------ STUDENT LOAN MARKETING ASSOCIATION--21.7% 5.235% 03/06/01+ ............................ $20,000 $ 20,000,000 5.265% 03/06/01+ ............................ 5,000 4,998,268 5.335% 03/06/01+ ............................ 5,000 5,000,000 ------------ 29,998,268 ------------ TOTAL VARIABLE RATE OBLIGATIONS (Cost $47,991,393) ...................... 47,991,393 ------------ REPURCHASE AGREEMENTS--32.5% J.P. Morgan Securities Inc. (Agreement dated 02/28/01 to be repurchased at $19,803,025 collateralized by $19,081,000 Federal Home Loan Bank Bond 5.000% due 02/28/03. Market Value of collateral is $20,395,710.) 5.500% 03/01/01 ............................. 19,800 19,800,000 UBS Warburg LLC (Agreement dated 02/28/01 to be repurchased at $25,003,806 collateralized by $25,000,000 par U.S. Treasury Strip 9.375% due 10/15/20. Market Value of collateral is $25,751,438.) 5.480% 03/01/01 ............................. 25,000 25,000,000 ------------ TOTAL REPURCHASE AGREEMENTS (Cost $44,800,000) ...................... 44,800,000 ------------ TOTAL INVESTMENTS AT VALUE--99.8% (Cost $137,505,537*) ........................ 137,505,537 ------------ OTHER ASSETS IN EXCESS OF LIABILITIES--0.2% ........................ 218,295 ------------ NET ASSETS--100.0% ............................. $137,723,832 ============ * Also cost for Federal income tax purposes. + Variable Rate Obligations -- The interest rate is the rate as of February 28, 2001 and the maturity date shown is the longer of the next interest readjustment date or the maturity date. See Accompanying Notes to Financial Statements. 10 THE BEDFORD FAMILY THE RBB FUND, INC. STATEMENTS OF OPERATIONS FOR THE SIX MONTHS ENDED FEBRUARY 28, 2001 (UNAUDITED)
GOVERNMENT MUNICIPAL OBLIGATIONS MONEY MARKET MONEY MARKET MONEY MARKET PORTFOLIO PORTFOLIO PORTFOLIO ------------ ------------ ------------ Investment Income Interest .......................................... $42,133,714 $2,937,745 $3,235,215 ----------- ---------- ---------- Expenses Investment advisory fees .......................... 2,414,451 245,031 230,023 Distribution fees ................................. 2,100,438 455,111 332,439 Transfer agent fees ............................... 272,845 11,085 5,672 Printing fees ..................................... 189,096 43,314 17,355 Custodian fees .................................... 84,998 18,895 14,167 Registration fees ................................. 70,826 43,450 17,325 Legal fees ........................................ 65,689 6,882 2,670 Directors' fees ................................... 64,806 3,326 1,900 Insurance expense ................................. 40,634 1,430 1,490 Audit fees ........................................ 39,299 2,754 1,850 Service organization fees ......................... 6,613 -- -- Miscellaneous ..................................... -- 1,014 3,490 Administration fees ............................... -- 70,009 -- ----------- ---------- ---------- 5,349,695 902,301 628,381 Less fees waived .................................. (980,543) (257,565) (116,937) Less expense reimbursement by advisor ............. (10,676) (14,164) -- ----------- ---------- ---------- Total expenses ............................... 4,358,476 630,572 511,444 ----------- ---------- ---------- Net investment income ................................ 37,775,238 2,307,173 2,723,771 ----------- ---------- ---------- Realized gain (loss) on investments .................. 108,957 (11,120) 1,318 ----------- ---------- ---------- Net increase in net assets resulting from operations.. $37,884,195 $2,296,053 $2,725,089 =========== ========== ==========
See Accompanying Notes to Financial Statements. 11 THE BEDFORD FAMILY THE RBB FUND, INC. STATEMENTS OF CHANGES IN NET ASSETS
MUNICIPAL MONEY MONEY MARKET PORTFOLIO MARKET PORTFOLIO ------------------------------------ ------------------------------------ FOR THE FOR THE FOR THE FOR THE SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2001 AUGUST 31, 2000 FEBRUARY 28, 2001 AUGUST 31, 2000 ----------------- --------------- ----------------- --------------- (UNAUDITED) (UNAUDITED) Increase (decrease) in net assets: Operations: Net investment income ................ $ 37,775,238 $ 142,300,137 $ 2,307,173 $ 6,958,598 Net gain (loss) on investments ....... 108,957 (46,157) (11,120) -- -------------- --------------- ------------ ------------- Net increase in net assets resulting from operations .......... 37,884,195 142,253,980 2,296,053 6,958,598 -------------- --------------- ------------ ------------- Distributions to shareholders: Dividends to shareholders from Net Investment Income: Bedford shares ..................... (13,416,537) (21,820,881) (2,303,985) (3,912,970) Cash Preservation shares ........... (8,632) (14,538) (3,188) (6,360) Janney Montgomery Scott shares ........................... -- (55,534,937) -- (3,039,268) Principal shares ................... (6,803,693) (11,383,856) -- -- Sansom Street shares ............... (8,238,699) (31,566,483) -- -- Select shares ...................... (9,307,677) (21,979,442) -- -- -------------- --------------- ------------ ------------- Total Dividends to shareholders ................... (37,775,238) (142,300,137) (2,307,173) (6,958,598) -------------- --------------- ------------ ------------- Net capital share transactions ......... (324,235,647) (1,334,348,297) 22,789,394 (142,742,303) -------------- --------------- ------------ ------------- Total increase/(decrease) in net assets ........................... (324,126,690) (1,334,394,454) 22,778,274 (142,742,303) Net Assets: Beginning of period .................. 1,404,725,877 2,739,120,331 122,289,161 265,031,464 -------------- --------------- ------------ ------------- End of period ........................ $1,080,599,187 $ 1,404,725,877 $145,067,435 $ 122,289,161 ============== =============== ============ =============
GOVERNMENT OBLIGATIONS MONEY MARKET PORTFOLIO ------------------------------------ FOR THE FOR THE SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2001 AUGUST 31, 2000 ----------------- --------------- (UNAUDITED) Increase (decrease) in net assets: Operations: Net investment income ................ $ 2,723,771 $ 22,009,006 Net gain (loss) on investments ....... 1,318 (776) ------------ ------------- Net increase in net assets resulting from operations .......... 2,725,089 22,008,230 ------------ ------------- Distributions to shareholders: Dividends to shareholders from Net Investment Income: Bedford shares ..................... (2,723,771) (5,029,950) Cash Preservation shares ........... -- -- Janney Montgomery Scott shares ........................... -- (16,979,056) Principal shares ................... -- -- Sansom Street shares ............... -- -- Select shares ...................... -- -- ------------ ------------- Total Dividends to shareholders ................... (2,723,771) (22,009,006) ------------ ------------- Net capital share transactions ......... 43,922,511 (388,595,430) ------------ ------------- Total increase/(decrease) in net assets ........................... 43,923,829 (388,596,206) Net Assets: Beginning of period .................. 93,800,003 482,396,209 ------------ ------------- End of period ........................ $137,723,832 $ 93,800,003 ============ =============
See Accompanying Notes to Financial Statements. 12 THE BEDFORD FAMILY THE RBB FUND, INC. FINANCIAL HIGHLIGHTS (a) (FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
MONEY MARKET PORTFOLIO ---------------------------------------------------------------- FOR THE FOR THE FOR THE FOR THE FOR THE SIX MONTHS YEAR YEAR YEAR YEAR ENDED ENDED ENDED ENDED ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, 2001 2000 1999 1998 1997 ----------- ---------- ---------- ---------- ---------- (UNAUDITED) Net asset value, beginning of period ....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- -------- -------- -------- ---------- Income from investment operations: Net investment income ..... 0.0277 0.0512 0.0425 0.0473 0.0462 -------- -------- -------- -------- ---------- Total net income from investment operations ............. 0.0277 0.0512 0.0425 0.0473 0.0462 -------- -------- -------- -------- ---------- Less distributions Dividends (from net investment income) ....... (0.0277) (0.0512) (0.0425) (0.0473) (0.0462) -------- -------- -------- -------- ---------- Total distributions ...... (0.0277) (0.0512) (0.0425) (0.0473) (0.0462) -------- -------- -------- -------- ---------- Net asset value, end of period ............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======== ======== ======== ========== Total Return .............. 2.81%(b) 5.24% 4.34% 4.84% 4.72% Ratios /Supplemental Data Net assets, end of period (000) ...... $560,284 $423,977 $360,123 $762,739 $1,392,911 Ratios of expenses to average net assets ....... 1.00%(c)(d) .97%(c) .97%(c) .97%(c) .97%(c Ratios of net investment income to average net assets ............... 5.58%(d) 5.15% 4.25% 4.73% 4.62%
MUNICIPAL MONEY MARKET PORTFOLIO ---------------------------------------------------------------- FOR THE FOR THE FOR THE FOR THE FOR THE SIX MONTHS YEAR YEAR YEAR YEAR ENDED ENDED ENDED ENDED ENDED FEBRUARY 28, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, 2001 2000 1999 1998 1997 ------------ ---------- ---------- ---------- ---------- (UNAUDITED) Net asset value, beginning of period ....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- -------- -------- -------- --------- Income from investment operations: Net investment income ..... 0.0164 0.0301 0.0243 0.0286 0.0285 -------- -------- -------- -------- --------- Total net income from investment operations ............. 0.0164 0.0301 0.0243 0.0286 0.0285 -------- -------- -------- -------- --------- Less distributions Dividends (from net investment income) ....... (0.0164) (0.0301) (0.0243) (0.0286) (0.0285) -------- -------- -------- -------- --------- Total distributions ...... (0.0164) (0.0301) (0.0243) (0.0286) (0.0285) -------- -------- -------- -------- --------- Net asset value, end of period ............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======== ======== ======== ========= Total Return .............. 1.65%(b) 3.05% 2.46% 2.97% 2.88% Ratios /Supplemental Data Net assets, end of period (000) ...... $144,878 $131,201 $150,278 $147,633 $213,034 Ratios of expenses to average net assets ....... .90%(c)(d) .89%(c) .89%(c) .89%(c) .85%(c) Ratios of net investment income to average net assets ............... 3.29%(d) 2.98% 2.43% 2.86% 2.85% (a) Financial Highlights relate solely to the Bedford Class of shares within each portfolio. (b) Non-Annualized. (c) Without the waiver of advisory and administration fees and without the reimbursement of certain operating expenses, the ratios of expenses to average net assets for the Money Market Portfolio would have been 1.18% for the six months ended February 28, 2001, 1.05%, 1.08%, 1.10% and 1.12%, for the years ended August 31, 2000, 1999, 1998 and 1997, respectively. For the Municipal Money Market Portfolio, the ratios of expenses to average net assets would have been 1.26% for the six months ended February 28, 2001, 1.21%, 1.15%, 1.15% and 1.14% for the years ended August 31, 2000, 1999, 1998 and 1997, respectively. (d) Annualized.
See Accompanying Notes to Financial Statements. 13 THE BEDFORD FAMILY THE RBB FUND, INC. FINANCIAL HIGHLIGHTS (a) (FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
GOVERNMENT OBLIGATIONS MONEY MARKET PORTFOLIO ------------------------------------------------------------------------------------- FOR THE FOR THE FOR THE FOR THE FOR THE SIX MONTHS YEAR YEAR YEAR YEAR ENDED ENDED ENDED ENDED ENDED FEBRUARY 28, 2001 AUGUST 31, 2000 AUGUST 31, 1999 AUGUST 31, 1998 AUGUST 31, 1997 ---------------- --------------- --------------- --------------- --------------- (UNAUDITED) Net asset value, beginning of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- -------- -------- -------- -------- Income from investment operations: Net investment income ..................... 0.0266 0.0492 0.0409 0.0464 0.0449 -------- -------- -------- -------- -------- Total net income from investment operations .......................... 0.0266 0.0492 0.0409 0.0464 0.0449 -------- -------- -------- -------- -------- Less distributions Dividends (from net investment income) .... (0.0266) (0.0492) (0.0409) (0.0464) (0.0449) -------- -------- -------- -------- -------- Total distributions ................... (0.0266) (0.0492) (0.0409) (0.0464) (0.0449) -------- -------- -------- -------- -------- Net asset value, end of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======== ======== ======== ======== Total Return ................................ 2.69%(b) 5.03% 4.17% 4.74% 4.59% Ratios /Supplemental Data Net assets, end of period (000) ........... $137,724 $102,322 $113,050 $128,447 $209,715 Ratios of expenses to average net assets .. 1.00%(c)(d) .977%(c) .975%(c) .975%(c) .975%(c) Ratios of net investment income to average net assets ...................... 5.33%(d) 4.92% 4.09% 4.63% 4.49% (a) Financial Highlights relate solely to the Bedford Class of shares within each portfolio. (b) Non-Annualized. (c) Without the waiver of advisory, distribution and administration fees and without the reimbursement of certain operating expenses, the ratios of expenses to average net assets for the Government Obligations Money Market Portfolio would have been 1.23% for the six months ended February 28, 2001 and 1.12%, 1.13%, 1.10% and 1.09% for the years ended August 31, 2000, 1999, 1998 and 1997, respectively. (d) Annualized.
See Accompanying Notes to Financial Statements. 14 THE BEDFORD FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 2001 (UNAUDITED) NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The RBB Fund, Inc (the "Fund") is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. The Fund was incorporated in Maryland on February 29, 1988. The Fund has authorized capital of thirty billion shares of common stock of which 15.98 billion shares are currently classified into ninety-four classes. Each class represents an interest in one of fourteen investment portfolios of the Fund. The classes have been grouped into thirteen separate "families", eight of which have begun investment operations: the Bedford Family, the Sansom Street Family, the Cash Preservation Family, the Principal Family, the n/i numeric investors Family, the Boston Partners Family, the Bogle Family and the Schneider Family. The Bedford Family represents interests in three portfolios, which are covered in this report. A) SECURITY VALUATION -- Portfolio securities are valued under the amortized cost method, which approximates current market value. Under this method, securities are valued at cost when purchased and thereafter a constant proportionate amortization of any discount or premium is recorded until maturity of the security. Regular review and monitoring of the valuation is performed to ensure that cost continues to approximate market value and to avoid dilution or other unfair results to shareholders. The Portfolio seeks to maintain net asset value per share at $1.00. B) SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are accounted for on the trade date. The cost of investments sold is determined by use of the specific identification method for both financial reporting and income tax purposes. Interest income is recorded on the accrual basis. Certain expenses, principally distribution, transfer agency and printing, are class specific expenses and vary by class. Expenses not directly attributable to a specific portfolio or class are allocated based on relative net assets of each portfolio and class, respectively. C) DISTRIBUTIONS TO SHAREHOLDERS -- Dividends from net investment income are declared daily and paid monthly. Any net realized capital gains are distributed at least annually. Income distributions and capital gain distributions are determined in accordance with income tax regulations, which may differ from accounting principles generally accepted in the United States of America. D) FEDERAL INCOME TAXES -- No provision is made for Federal taxes. It is the Fund's intention to have each portfolio to continue to qualify for and elect the tax treatment applicable to regulated investment companies under the Internal Revenue Code and make the requisite distributions to its shareholders which will be sufficient to relieve it from Federal income and excise taxes. E) REPURCHASE AGREEMENTS --- Money market instruments may be purchased subject to the seller's agreement to repurchase them at an agreed upon date and price. The seller will be required on a daily basis to maintain the value of the securities subject to the agreement at not less than the repurchase price plus accrued interest. If the value of the underlying securities fall below 102% of the value of the purchase price plus accrued interest, the Fund will require the seller to deposit additional collateral by the next Fund business day. In the event that the seller under the agreement defaults on its repurchase obligation or fails to deposit sufficient collateral, the Fund has the contractual right, subject to the requirements of applicable bankruptcy and insolvency laws, to sell the underlying securities and may claim any resulting loss from the seller. The agreements are conditioned upon the collateral being deposited under the Federal Reserve book-entry system or with the Fund's custodian or a third party sub-custodian. 15 THE BEDFORD FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F) USE OF ESTIMATES -- The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES Pursuant to Investment Advisory Agreements, BlackRock Institutional Management Corp. ("BIMC"), an indirect majority-owned subsidiary of The PNC Financial Services Group, Inc., serves as investment adviser to the portfolios described herein, and also serves as administrator for the Money Market and the Government Obligations Money Market Portfolios. For the Money Market and Government Obligations Money Market Portfolios, BIMC and PFPC, Inc. ("PFPC") have entered into a delegation agreement, under which PFPC has agreed to perform Administration and Accounting services for an annual fee of .10% of the average net assets of the portfolios, paid out of the fee paid to BIMC. For its advisory services, BIMC is entitled to receive the following fees, computed daily and payable monthly, and based on the portfolio's average daily net assets: PORTFOLIO ANNUAL RATE --------------------------- --------------------------------------------- Money Market and Government .45% of first $250 million of net assets; Obligations Money Market .40% of next $250 million of net assets; Portfolios .35% of net assets in excess of $500 million. Municipal Money Market .35% of first $250 million of net assets; Portfolio .30% of next $250 million of net assets; .25% of net assets in excess of $500 million. BIMC may, at its discretion, voluntarily waive all or any portion of its advisory fee for these portfolios. For each class of shares within a respective portfolio, the net advisory fee charged to each class is the same on a relative basis. For the six months ended February 28, 2001, advisory fees and waivers for the investment portfolios were as follows:
GROSS NET ADVISORY ADVISORY FEE WAIVER FEE ---------- ---------- ---------- Money Market Portfolio $2,414,451 $(980,543) $1,433,908 Municipal Money Market Portfolio 245,031 (241,612) 3,419 Government Obligations Money Market Portfolio 230,023 (116,937) 113,086
The investment advisor has agreed to reimburse each portfolio for the amount, if any, by which the total operating and management expenses exceed the cap. For the six months ended February 28, 2001 the reimbursed expenses were $10,676 for the Money Market Portfolio. For the Municipal Money Market, other expenses reimbursed were $14,164. PFPC Trust Co. serves as custodian for each of the Fund's portfolios. PFPC serves as each class's transfer and dividend disbursing agent. Both PFPC Trust Co. and PFPC are wholly owned subsidiaries of PFPC Worldwide Inc., an indirect majority owned subsidiary of The PNC Financial Services Group, Inc. 16 THE BEDFORD FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES (CONTINUED) PFPC may, at its discretion, voluntarily waive all or any portion of its transfer agency fee for any class of shares. For the six months ended February 28, 2001, no fees were waived. Transfer agency fees were as follows: TRANSFER AGENCY FEE --------------- Money Market Portfolio Bedford Class $123,985 Cash Preservation Class -- Principal Class -- Sansom Street Class 145,465 Select Class* 3,395 -------- Total Money Market Portfolio $272,845 ======== Municipal Money Market Portfolio Bedford Class $ 10,704 Cash Preservation Class 381 -------- Total Municipal Money Market Portfolio $ 11,085 ======== Government Obligations Money Market Portfolio Bedford Class $ 5,672 ======== *The Select Class of shares was liquidated on January 31, 2001. In addition, PFPC serves as administrator for the Municipal Money Market Portfolio. The administration fee is computed daily and payable monthly at an annual rate of .10% of the Portfolio's average daily net assets. PFPC may, at its discretion, voluntarily waive all or any portion of its administration fee for the Portfolio. For the six months ended February 28, 2001, the administration fee and waiver for the portfolio were as follows:
GROSS NET ADMINISTRATION ADMINISTRATION FEE WAIVER FEE -------------- --------- --------------- Municipal Money Market Portfolio $70,009 $(15,953) $54,056
The Fund on behalf of each class of shares within the investment portfolio, has adopted Distribution Plans pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. The Fund has entered into Distribution Contracts with PFPC Distributors Inc. ("PFPC Distributors"). PFPC Distributors is a wholly owned subsidiary of PFPC Worldwide Inc., an indirect majority owned subsidiary of The PNC Financial Services Group, Inc. The contracts provide for each class to make payments, based on average net assets to PFPC Distributors of up to .65% on an annual basis for the Bedford, Cash Preservation, and Principal Classes and up to .20% on an annualized basis for the Sansom Street Class. Prior to January 2, 2001, Provident Distributors, Inc. ("PDI") served as the Fund's distributor pursuant to the same compensation arrangement as PFPC Distributors. 17 THE BEDFORD FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES (CONTINUED) For the period September 1, 2000 through January 1, 2001, distribution fees paid to PDI were as follows: DISTRIBUTION FEE ------------ Money Market Portfolio Bedford Class $1,006,789 Cash Preservation Class 417 Principal Class 303,527 Sansom Street Class 46,718 ---------- Total Money Market Portfolio $1,357,451 ========== Municipal Money Market Portfolio Bedford Class $ 296,131 Cash Preservation Class 270 ---------- Total Municipal Money Market Portfolio $ 296,401 ========== Government Obligations Money Market Portfolio Bedford Class $ 209,734 ========== For the period January 2, 2001 through February 28, 2001, distribution fees paid to PFPC Distributors were as follows: DISTRIBUTION FEE ------------ Money Market Portfolio Bedford Class $557,103 Cash Preservation Class 195 Principal Class 165,132 Sansom Street Class 20,557 -------- Total Money Market Portfolio $742,987 ======== Municipal Money Market Portfolio Bedford Class $158,587 Cash Preservation Class 123 -------- Total Municipal Money Market Portfolio $158,710 ======== Government Obligations Money Market Portfolio Bedford Class $112,705 ======== The Fund has entered into service agreements with banks affiliated with PNC Bank who render support services to customers who are the beneficial owners of the Sansom Street Class in consideration of the payment of .10% of the daily net asset value of such shares. For the six months ended February 28, 2001 service organization fees were $6,613 for the Money Market Portfolio. 18 THE BEDFORD FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) NOTE 3. CAPITAL SHARES Transactions in capital shares (at $1 per capital share) for each year were as follows:
MONEY MARKET PORTFOLIO MUNICIPAL MONEY MARKET PORTFOLIO ------------------------------------ ------------------------------------ FOR THE FOR THE FOR THE FOR THE SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2001 AUGUST 31, 2000 FEBRUARY 28, 2001 AUGUST 31, 2000 ----------------- --------------- ----------------- --------------- (UNAUDITED) (UNAUDITED) VALUE VALUE VALUE VALUE ----------------- --------------- ----------------- --------------- Shares sold: Bedford Class $ 433,960,416 $ 866,092,657 $ 161,376,135 $ 240,430,505 Cash Preservation Class 54,322 462,203 43,985 62,468 Janney Montgomery Scott Class* -- 5,748,987,958 -- 389,880,620 Principal Class 298,524,968 534,885,343 -- -- Sansom Street Class 919,442,358 3,118,553,510 -- -- Select Class** 947,199,090 2,969,370,240 -- -- --------------- --------------- ------------- ------------- Total Shares Sold 2,599,181,154 13,238,351,911 161,420,120 630,373,593 Shares issued on reinvestment of dividends: Bedford Class 13,563,546 21,403,595 2,320,124 3,875,706 Cash Preservation Class 9,050 13,920 3,176 6,129 Janney Montgomery Scott Class* -- 54,694,717 -- 3,013,665 Principal Class 6,883,017 11,245,950 -- -- Sansom Street Class 402,129 13,899,819 -- -- --------------- --------------- ------------- ------------- Total Shares Reinvested 20,857,742 101,258,001 2,323,300 6,895,500 Shares repurchased: Bedford Class (342,188,868) (792,698,785) (140,896,786) (272,492,533) Cash Preservation Class (149,220) (194,641) (57,240) (83,714) Janney Montgomery Scott Class* -- (6,892,100,877) -- (507,435,149) Principal Class (246,598,269) (547,145,226) -- -- Sansom Street Class (1,002,933,427) (3,647,602,057) -- -- Select Class** (1,352,404,759) (2,794,216,623) -- -- --------------- --------------- ------------- ------------- Total Shares Repurchased (2,944,274,543) (14,673,958,209) (140,954,026) (780,011,396) --------------- --------------- ------------- ------------- Net increase (decrease) $ (324,235,647) $(1,334,348,297) $ 22,789,394 $(142,742,303) =============== =============== ============= ============= Bedford Shares authorized 1,500,000,000 1,500,000,000 500,000,000 500,000,000 =============== =============== ============= ============= * The Janney Montgomery Scott Class of shares was liquidated on July 31, 2000. ** The Select Class of shares was liquidated on January 31, 2001
19 THE BEDFORD FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) NOTE 3. CAPITAL SHARES (CONTINUED)
GOVERNMENT OBLIGATIONS MONEY MARKET PORTFOLIO -------------------------------------------- FOR THE FOR THE SIX MONTHS ENDED YEAR ENDED FEBRUARY 28, 2001 AUGUST 31, 2000 ----------------- ---------------- (UNAUDITED) VALUE VALUE ----------------- ---------------- Shares sold: Bedford Class $108,556,799 $ 270,056,423 Janney Montgomery Scott Class* -- 1,451,470,056 ------------ --------------- Total Shares Sold 108,556,799 1,721,526,479 Shares issued on reinvestment of dividends: Bedford Class 2,746,728 4,991,533 Janney Montgomery Scott Class* -- 16,792,074 ------------ --------------- Total Shares Reinvested 2,746,728 21,783,607 Shares repurchased: Bedford Class (67,381,016) (294,238,125) Janney Montgomery Scott Class* -- (1,837,667,391) ------------ --------------- Total Shares Repurchased (67,381,016) (2,131,905,516) ------------ --------------- Net increase (decrease) $ 43,922,511 $ (388,595,430) ============ =============== Bedford Shares authorized 500,000,000 500,000,000 ============ =============== *The Janney Montgomery Scott Class of shares was liquidated on July 31, 2000.
20 THE BEDFORD FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) NOTE 4. NET ASSETS At February 28, 2001, net assets consisted of the following:
GOVERNMENT MUNICIPAL OBLIGATIONS MONEY MARKET MONEY MARKET MONEY MARKET PORTFOLIO PORTFOLIO PORTFOLIO -------------- ------------ ------------ Paid-in capital $1,080,592,416 $145,097,048 $137,780,632 Accumulated net realized gain/(loss) on investments 6,771 (29,613) (56,800) ------------- ------------ ------------ Total net assets $1,080,599,187 $145,067,435 $137,723,832 ============== ============ ============
NOTE 5. CAPITAL LOSS CARRYOVER At August 31, 2000 capital loss carryovers were available to offset future realized gains as follows: $102,186 in the Money Market Portfolio of which $56,029 expires in 2006 and $46,157 expires in 2008; $18,493 in the Municipal Money Market Portfolio of which, $1,058 expires in 2001, $9,789 expires in 2002, $674 expires in 2004, $3,917 expires in 2005, and $3,055 expires in 2006; $58,118 in the Government Obligations Money Market Portfolio of which $12,275 expires in 2004, $1,291 expires in 2005, $5,792 expires in 2006, $37,984 expires in 2007 and $776 expires in 2008. 21 THE BEDFORD FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FEBRUARY 28, 2001 (UNAUDITED) NOTE 6. OTHER FINANCIAL HIGHLIGHTS The Fund currently offers three other classes of shares representing interest in the Money Market Portfolio: Cash Preservation, Sansom Street, and Principal. The Fund currently offers one other class of shares representing interest in the Municipal Money Market Portfolio: Cash Preservation. Each class is marketed to different types of investors. Financial Highlights of the Cash Preservation class is not represented in this report due to its immateriality. Such information is available in the annual report of its respective family. The financial highlights of certain of the other classes are as follows: THE SANSOM STREET FAMILY (a)
MONEY MARKET PORTFOLIO ------------------------------------------------------------------------------------- FOR THE FOR THE FOR THE FOR THE FOR THE SIX MONTHS YEAR YEAR YEAR YEAR ENDED ENDED ENDED ENDED ENDED FEBRUARY 28, 2001 AUGUST 31, 2000 AUGUST 31, 1999 AUGUST 31, 1998 AUGUST 31, 1997 ----------------- --------------- --------------- --------------- --------------- (UNAUDITED) Net asset value, beginning of year or period . $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- -------- -------- -------- -------- Income from investment operations: Net investment income ..................... 0.0303 0.0560 0.0473 0.0520 0.0510 -------- -------- -------- -------- -------- Total net income from investment operations ............................ 0.0303 0.0560 0.0473 0.0520 0.0510 -------- -------- -------- -------- -------- Less distributions Dividends (from net investment income) .... (0.0303) (0.0560) (0.0473) (0.0520) (0.0510) -------- -------- -------- -------- -------- Total distributions ..................... (0.0303) (0.0560) (0.0473) (0.0520) (0.0510) -------- -------- -------- -------- -------- Net asset value, end of year or period ....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======== ======== ======== ======== Total Return ................................. 3.06%(b) 5.75% 4.83% 5.34% 5.22% Ratios/Supplemental Data Net assets, end of year or period (000) ... $243,656 $326,745 $841,887 $684,066 $570,018 Ratios of expenses to average net assets .. .49%(c)(d) .49%(c) .49%(c) .49%(c) .49%(c) Ratios of net investment income to average net assets ...................... 6.12%(d) 5.42% 4.73% 5.20% 5.10% (a) Financial highlights relate solely to the Sansom Street Class of shares within the portfolio. (b) Non-Annualized. (c) Without the waiver of advisory fees and reimbursement of certain operating expenses, the ratios of expenses to average net assets for the Money Market Portfolio would have been .66% for the six months ended February 28, 2001, .61%, .62%, .62% and .64% for the years ended August 31, 2000, 1999, 1998 and 1997, respectively. (d) Annualized.
22 THE BEDFORD FAMILY THE RBB FUND, INC. NOTES TO FINANCIAL STATEMENTS (CONCLUDED) FEBRUARY 28, 2001 (UNAUDITED) NOTE 6. OTHER FINANCIAL HIGHLIGHTS (CONTINUED) THE PRINCIPAL FAMILY (a)
MONEY MARKET PORTFOLIO ---------------------------------------------------------- FOR THE FOR THE SIX MONTHS YEAR FOR THE PERIOD ENDED ENDED JUNE 1, 1999 TO FEBRUARY 28, 2001 AUGUST 31, 2000 AUGUST 31, 1999(b) ----------------- --------------- ------------------ (UNAUDITED) Net asset value, beginning of year or period ........... $ 1.00 $ 1.00 $ 1.00 -------- -------- -------- Income from investment operations: Net investment income ............................... 0.0289 0.0532 0.0110 -------- -------- -------- Total net income from investment operations ....... 0.0289 0.0532 0.0110 -------- -------- -------- Less distributions Dividends (from net investment income) .............. (0.0289) (0.0532) (0.0110) -------- -------- -------- Total distributions ............................... (0.0289) (0.0532) (0.0110) -------- -------- -------- Net asset value, end of year or period ................. $ 1.00 $ 1.00 $ 1.00 ======== ======== ======== Total Return ........................................... 2.92%(c) 5.46% 1.10%(e) Ratios /Supplemental Data Net assets, end of period (000) ..................... $276,333 $217,520 $218,530 Ratios of expenses to average net assets ............ .77%(d)(e) .77%(d) .77%(d)(e) Ratios of net investment income to average net assets ................................ 5.81%(e) 5.32% 4.36%(e) (a) Financial highlights relate solely to the Principal Family of shares within the portfolio. (b) On June 1, 1999 the Money Market Portfolio's Principal Class began operations. (c) Non-Annualized. (d) Without the waiver of advisory and transfer agent fees and reimbursement of certain operating expenses, the ratios of expenses to average net assets for the Money Market Portfolio would have been .83% for the six months ended February 28, 2001, .85% and .85% for the periods ended August 31, 2000 and 1999, respectively. (e) Annualized.
23 Morgan Keegan & Company, Inc./Morgan Keegan Tower/Fifty Front Street/Memphis, Tennessee 38103 -----END PRIVACY-ENHANCED MESSAGE-----