N-Q 1 poi_fef.txt N-Q~INSTITUTIONAL FOREIGN EQUITY FUND Item 1. Schedule of Investmets. T. Rowe Price Institutional Foreign Equity Fund (Unaudited) July 31, 2004 PORTFOLIO OF INVESTMENTS (1) Shares Value (Cost and value in $ 000s) AUSTRALIA 1.2% Common Stocks 0.7% BHP Billiton 616,875 5,719 5,719 Preferred Stocks 0.5% News Corporation 473,179 3,817 3,817 Total Australia (Cost $5,817) 9,536 BELGIUM 0.3% Common Stocks 0.3% Fortis 46,584 1,004 UCB 26,252 1,208 Total Belgium (Cost $876) 2,212 BRAZIL 1.0% Common Stocks 1.0% Petroleo Brasileiro (Petrobras) ADR (USD) 131,060 3,362 Tele Norte Leste Participacoes ADR (USD) 333,400 4,354 Total Brazil (Cost $5,929) 7,716 CANADA 0.3% Common Stocks 0.3% Research In Motion (USD) * 43,500 2,683 Total Canada (Cost $1,695) 2,683 CHINA 0.4% Common Stocks 0.4% China Telecom (HKD) 144A * 7,016,000 2,316 China Telecom (H shares) (HKD) 2,576,000 851 Total China (Cost $2,833) 3,167 DENMARK 0.6% Common Stocks 0.6% Novo Nordisk ADR, Series B 95,851 4,871 Total Denmark (Cost $2,806) 4,871 FINLAND 0.8% Common Stocks 0.8% Nokia 582,482 6,678 Total Finland (Cost $1,067) 6,678 FRANCE 13.8% Common Stocks 13.8% Aventis ss. 88,492 6,867 AXA 236,144 4,850 BNP Paribas 142,736 8,308 Compagnie de Saint-Gobain 100,304 4,899 Credit Agricole ss. 290,324 6,846 France Telecom * 309,300 7,658 Groupe Danone ss. 49,360 4,068 Hermes 30,644 5,914 L'Oreal 41,038 2,940 Lafarge ss. 10,290 882 LVMH ss. 82,034 5,596 Sanofi-Synthelabo ss. 140,294 9,300 Schneider Electric 90,883 5,779 Societe Generale ss. 46,249 3,795 Societe Television Francaise 1 ss. 204,339 5,824 Sodexho Alliance ss. 141,579 3,848 Thomson ss. 104,555 1,947 Total ss. 103,578 20,100 Vivendi Universal * 65,197 1,629 Total France (Cost $65,632) 111,050 GERMANY 2.5% Common Stocks 2.5% Allianz 21,689 2,095 Bayer 41,284 1,102 Bayerische Hypo-und Vereinsbank * 53,742 866 Deutsche Bank 41,543 2,886 E.On 29,849 2,124 Hypo Real Estate * 143,504 4,451 Rhoen-Klinikum 32,075 1,640 SAP 24,770 3,970 Siemens 19,516 1,369 Total Germany (Cost $15,226) 20,503 HONG KONG 1.1% Common Stocks 1.1% Cheung Kong Holdings 396,000 2,920 Li & Fung 1,656,000 2,293 Sun Hung Kai Properties 399,000 3,376 Total Hong Kong (Cost $7,521) 8,589 INDIA 1.1% Common Stocks 1.1% Infosys Technologies 82,800 2,771 Oil & Natural Gas * 66,200 1,020 Oil & Natural Gas (Regulation S shares) * 45,400 699 Zee Telefilms 1,375,900 4,169 Total India (Cost $7,575) 8,659 ISRAEL 0.2% Common Stocks 0.2% Check Point Software Technologies (USD) * 78,016 1,552 Total Israel (Cost $1,433) 1,552 ITALY 4.7% Common Stocks 4.7% Alleanza Assicurazioni 413,680 4,430 Banca Intesa 505,010 1,871 Banco Popolare di Verona e Novara 107,100 1,786 ENI 503,931 10,367 Mediaset 158,475 1,689 Mediolanum ss. 235,675 1,443 Telecom Italia 231,936 688 Telecom Italia Mobile 910,646 4,843 Telecom Italia-RNC 1,481,864 3,182 UniCredito Italiano 1,586,443 7,597 Total Italy (Cost $20,465) 37,896 JAPAN 22.3% Common Stocks 22.3% Canon 189,100 9,236 Credit Saison 65,800 1,991 Dai Nippon Printing 350,000 4,956 Daikin Industries 110,000 2,711 Daito Trust Construction 117,700 4,386 Daiwa Securities 584,000 3,833 Denso 113,100 2,772 Fanuc 85,400 4,923 Fujisawa Pharmaceutical 124,300 3,013 Funai Electric 28,600 4,006 Hoya 35,600 3,660 JSR 168,400 2,790 KDDI 1,358 6,938 Keyence ss. 12,800 2,708 Kirin Brewery 224,000 2,192 Kyocera 45,100 3,482 Marui 190,500 2,300 Matsui Securities ss. 57,900 1,591 Mitsubishi 665,000 6,401 Mitsubishi Estate 249,000 2,833 Mitsui Fudosan 675,000 7,503 Mitsui Trust 413,000 2,892 NEC 673,000 4,200 Nidec 18,200 1,691 Nissan Motor 478,900 5,168 Nomura 611,000 8,383 Oji Paper ss. 343,000 2,199 Orix ss. 19,600 2,119 Rohm 35,600 3,810 Secom 187,500 7,576 Seven-Eleven Japan 190,000 5,834 Shin-Etsu Chemical 135,200 4,589 SMC 19,800 1,938 Softbank ss. 80,500 2,833 Sumitomo Metal Industries 2,206,000 2,377 Sumitomo Mitsui Financial ss. 1,266 7,627 Suzuki Motor ss. 191,000 3,396 Takefuji 31,870 2,289 Teijin 594,000 2,064 Toyota Motor 168,900 6,794 Trend Micro ss. 50,000 2,047 UFJ ss. * 1,282 5,145 Uniden 123,000 2,529 USS 18,670 1,509 Yamanouchi Pharmaceutical 135,500 4,647 Yamato Transport 143,000 2,276 Total Japan (Cost $158,059) 180,157 KAZAKHSTAN 0.4% Common Stocks 0.4% PetroKazakhstan (USD) 99,180 3,139 Total Kazakhstan (Cost $2,716) 3,139 MALAYSIA 0.2% Common Stocks 0.2% Astro All Asia * 765,600 923 Astro All Asia (Regulation S shares) * 810,000 976 Total Malaysia (Cost $1,783) 1,899 MEXICO 1.7% Common Stocks 1.7% America Movil ADR, Series L (USD) 101,600 3,630 Grupo Modelo, Series C 1,217,000 3,014 Grupo Televisa ADR (USD) 63,700 2,994 Wal-Mart de Mexico, Series B 1,401,773 4,276 Total Mexico (Cost $10,733) 13,914 NETHERLANDS 4.6% Common Stocks 4.6% Akzo Nobel 13,241 437 ASML Holding * ss. 242,130 3,458 Fortis (Unified shares) 68,907 1,501 ING Groep GDS 334,920 7,769 Koninklijke Numico * 156,136 4,867 Philips Electronics 242,206 5,869 Reed Elsevier ss. 98,750 1,262 Royal Dutch Petroleum ss. 49,439 2,478 Royal KPN 503,700 3,721 Royal KPN 144A 219,800 1,623 STMicroelectronics ss. 107,931 2,005 Wolters Kluwer GDS 126,820 2,133 Total Netherlands (Cost $24,533) 37,123 NORWAY 0.2% Common Stocks 0.2% Orkla, Series A 78,395 1,886 Total Norway (Cost $671) 1,886 RUSSIA 1.3% Common Stocks 1.3% AO VimpelCom ADR (USD) * 26,700 2,335 Lukoil ADR (USD) 7,900 861 Lukoil ADR (USD) 144A 28,990 3,160 Norilsk Nickel ADR (USD) 52,100 2,683 YUKOS ADR (USD) 64,590 1,106 Total Russia (Cost $9,765) 10,145 SINGAPORE 0.7% Common Stocks 0.7% United Overseas Bank 755,060 6,016 Total Singapore (Cost $4,712) 6,016 SOUTH KOREA 1.4% Common Stocks 1.4% Kookmin Bank * 116,640 3,207 Samsung Electronics 14,043 5,007 South Korea Telecom 21,720 2,953 Total South Korea (Cost $8,154) 11,167 SPAIN 4.2% Common Stocks 4.2% Banco Bilbao Vizcaya Argentaria ss. 571,783 7,608 Banco Santander Central Hispano ss. 519,713 4,940 Endesa ss. 170,741 3,106 Gas Natural ss. 139,230 3,214 Gestevision Telecino * 92,300 1,458 Inditex ss. 162,900 3,728 Repsol 88,210 1,872 Telefonica 392,569 5,720 Telefonica ADR (USD) 51,507 2,249 Total Spain (Cost $23,598) 33,895 SWEDEN 2.6% Common Stocks 2.6% Electrolux, Series B 108,350 1,892 Hennes & Mauritz, Series B 204,240 5,256 LM Ericsson * 824,783 2,203 Sandvik, Series A 14,170 487 Securitas, Series B 676,135 7,621 Tele2, Series B ss. 95,000 3,775 Total Sweden (Cost $18,907) 21,234 SWITZERLAND 6.2% Common Stocks 6.2% Adecco ADR 197,020 9,149 Credit Suisse Group * 233,520 7,494 Nestle 59,498 15,211 Roche Holding (Participation certificates) 45,700 4,520 UBS 207,332 13,875 Total Switzerland (Cost $25,769) 50,249 TAIWAN 0.8% Common Stocks 0.8% China Trust Finance 1,473,000 1,504 Taiwan Semiconductor Manufacturing 3,805,456 4,803 Total Taiwan (Cost $6,913) 6,307 UNITED KINGDOM 22.8% Common Stocks 22.8% Abbey National 121,911 1,257 AstraZeneca 246,043 11,015 Autonomy * 123,128 374 British Sky Broadcast 317,902 3,496 Cadbury Schweppes 196,496 1,609 Capita 192,400 1,071 Carnival 37,167 1,819 Centrica 790,310 3,400 Compass 1,909,650 11,108 David S. Smith 307,694 890 Diageo 400,499 4,965 Electrocomponents 482,140 2,875 GlaxoSmithKline 1,242,321 25,244 Hays 1,766,957 3,921 Hilton Group 288,940 1,371 Kesa Electricals 288,115 1,473 Kingfisher 2,100,603 10,853 MFI Furniture Group 986,500 2,369 Reed Elsevier 880,993 7,805 Rio Tinto 255,860 6,670 Royal Bank of Scotland Group 704,273 19,807 Shell Transport & Trading 1,797,558 13,031 Standard Chartered 147,300 2,437 Tesco 1,054,554 4,882 Tomkins ADR 780,206 3,580 Unilever 600,996 5,308 United Business Media ADR 315,489 2,835 Vodafone Group 8,768,557 19,022 William Morrison Supermarkets 896,600 2,952 WPP Group 756,690 7,000 Total United Kingdom (Cost $149,507) 184,439 SHORT-TERM INVESTMENTS 1.8% Money Market Funds 1.8% T. Rowe Price Reserve Investment Fund, 1.33% # 14,853,505 14,854 Total Short-Term Investments (Cost $14,854) 14,854 SECURITIES LENDING COLLATERAL 12.8% Money Market Pooled Account 12.8% Investment in money market pooled account managed by JP Morgan Chase Bank, London (USD), 1.32% # 102,985,017 102,985 Total Securities Lending Collateral (Cost $102,985) 102,985 Total Investments in Securities 112.0% of Net Assets (Cost $702,534) $ 904,521 (1) Denominated in currency of country of incorporation unless otherwise noted # Seven-day yield * Non-income producing ss. All or a portion of this security is on loan at July 31, 2004 - See Note 2 144A Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be resold in transactions exempt from registration only to qualified institutional buyers -- total value of such securities at period-end amounts to $7,099 and represents 0.9% of net assets ADR American Depository Receipts GDS Global Depository Shares HKD Hong Kong dollar USD U.S. dollar The accompanying notes are an integral part of this Portfolio of Investments. T. Rowe Price Institutional Foreign Equity Fund Unaudited July 31, 2004 Notes To Portfolio of Investments NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES T. Rowe Price Institutional International Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940 (the 1940 Act). The Institutional Foreign Equity Fund (the fund), a diversified, open-end management investment company, is one portfolio established by the corporation. The fund seeks long-term growth of capital through investments primarily in the common stocks of established, non-U.S. companies. Valuation The fund values its investments and computes its net asset value per share at the close of the New York Stock Exchange (NYSE), normally 4 p.m. ET, each day that the NYSE is open for business. Equity securities listed or regularly traded on a securities exchange or in the over-the-counter market are valued at the last quoted sale price or, for certain markets, the official closing price at the time the valuations are made, except for OTC Bulletin Board securities, which are valued at the mean of the latest bid and asked prices. A security that is listed or traded on more than one exchange is valued at the quotation on the exchange determined to be the primary market for such security. Listed securities not traded on a particular day are valued at the mean of the latest bid and asked prices for domestic securities and the last quoted sale price for international securities. Investments in mutual funds are valued at the mutual fund's closing net asset value per share on the day of valuation. Other investments and those for which the above valuation procedures are inappropriate or are deemed not to reflect fair value are stated at fair value as determined in good faith by the T. Rowe Price Valuation Committee, established by the fund's Board of Directors. Most foreign markets close before the close of trading on the NYSE. If the fund determines that developments between the close of a foreign market and the close of the NYSE will, in its judgment, materially affect the value of some or all of its portfolio securities, which in turn will affect the fund's share price, the fund will adjust the previous closing prices to reflect the fair value of the securities as of the close of the NYSE, as determined in good faith by the T. Rowe Price Valuation Committee, established by the fund's Board of Directors. A fund may also fair value securities in other situations, such as when a particular foreign market is closed but the fund is open. In deciding whether to make fair value adjustments, the fund reviews a variety of factors, including developments in foreign markets, the performance of U.S. securities markets, and the performance of instruments trading in U. S. markets that represent foreign securities and baskets of foreign securities. The fund uses outside pricing services to provide it with closing market prices and information used for adjusting those prices. The fund cannot predict how often it will use closing prices and how often it will adjust those prices. As a means of evaluating its fair value process, the fund routinely compares closing market prices, the next day's opening prices in the same markets, and adjusted prices. Investment Transactions Investment transactions are accounted for on the trade date. NOTE 2 - INVESTMENT TRANSACTIONS Consistent with its investment objective, the fund engages in the following practices to manage exposure to certain risks or enhance performance. The investment objective, policies, program, and risk factors of the fund are described more fully in the fund's prospectus and Statement of Additional Information. Emerging Markets The fund may invest in securities of companies located in emerging markets or denominated in or linked to the currencies of emerging market countries Future economic or political developments could adversely affect the liquidity or value, or both, of such securities. Securities Lending The fund lends its securities to approved brokers to earn additional income. It receives as collateral cash and U.S. government securities valued at 102% to 105% of the value of the securities on loan. Cash collateral is invested in money market pooled accounts managed by the fund's lending agents in accordance with investment guidelines approved by fund management. Collateral is maintained over the life of the loan in an amount not less than the value of loaned securities, as determined at the close of fund business each day; any additional collateral required due to changes in security values is delivered to the fund the next business day. Although risk is mitigated by the collateral, the fund could experience a delay in recovering its securities and a possible loss of income or value if the borrower fails to return the securities. At July 31, 2004, the value of loaned securities was $98,360,000; aggregate collateral consisted of $102,985,000 in money market pooled accounts. NOTE 3 - FEDERAL INCOME TAXES At July 31, 2004, the cost of investments for federal income tax purposes was $702,534,000. Net unrealized gain aggregated $201,910,000 at period-end, of which $231,774,000 related to appreciated investments and $29,864,000 related to depreciated investments. NOTE 4 - RELATED PARTY TRANSACTIONS The fund may invest in the T. Rowe Price Reserve Investment Fund and the T. Rowe Price Government Reserve Investment Fund (collectively, the Reserve Funds), open-end management investment companies managed by Price Associates. The Reserve Funds are offered as cash management options to mutual funds, trusts, and other accounts managed by Price Associates and/or its affiliates, and are not available for direct purchase by members of the public. Item 2. Controls and Procedures. (a) The registrant's principal executive officer and principal financial officer have evaluated the registrant's disclosure controls and procedures within 90 days of this filing and have concluded that the registrant's disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-Q was recorded, processed, summarized, and reported timely. (b) The registrant's principal executive officer and principal financial officer are aware of no changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 3. Exhibits. Separate certifications by the registrant's principal executive officer and principal financial officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and required by Rule 30a-2(a) under the Investment Company Act of 1940, are attached. 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. T. Rowe Price Institutional International Funds, Inc. By /s/ James S. Riepe James S. Riepe Principal Executive Officer Date September 17, 2004 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 /s/ James S. Riepe James S. Riepe Principal Executive Officer Date September 17, 2004 By /s/ Joseph A. Carrier Joseph A. Carrier Principal Financial Officer Date September 17, 2004