-----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, H51B62aEkSkKE4L9BXL1xwlKgG0WSyBX06zXbUHNUbTPopDna7I+twinfE37/kms qgn8fL/lVEHXeaPY9wdq9w== /in/edgar/work/20000808/0000935069-00-000401/0000935069-00-000401.txt : 20000921 0000935069-00-000401.hdr.sgml : 20000921 ACCESSION NUMBER: 0000935069-00-000401 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20000531 FILED AS OF DATE: 20000808 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STI CLASSIC FUNDS CENTRAL INDEX KEY: 0000883939 STANDARD INDUSTRIAL CLASSIFICATION: [ ] STATE OF INCORPORATION: MA FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-06557 FILM NUMBER: 688571 BUSINESS ADDRESS: STREET 1: 2 OLIVER STREET CITY: BOSTON STATE: MA ZIP: 02109 BUSINESS PHONE: 6109896602 MAIL ADDRESS: STREET 1: 530 E SWEDESFORD ROAD CITY: WAYNE STATE: PA ZIP: 19087-1693 N-30D 1 0001.txt STI CLASSIC FIXED INCOME FUNDS ANNUAL REPORT ANNUAL - -------------------------------------------------------------------------------- FINANCIAL REPORT - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS - -------------------------------------------------------------------------------- A FAMILY OF MUTUAL FUNDS May 31, 2000 [STI Classic Logo Omitted] [Blank Page] Dear Valued STI Classic Trust Shareholder: The period corresponding to the STI Classic Funds' fiscal year ending May 31, 2000 is perhaps one of the most unusual in the history of modern financial markets. The U.S. economy continued on its growth path, extending the longest period of uninterrupted expansion. In fact, economic growth actually accelerated, prompting the Federal Reserve (the "Fed") to announce a series of rate increases. The capital markets responded by rewarding risk in equity securities and punishing it in fixed income markets. On the equity side, technology stocks were prominent, as evidenced by the 37.7% rise in the NASDAQ Composite Index and even greater 59.1% appreciation in the larger stocks of the NASDAQ 100 Index. Small cap stocks did well, predominantly because of technology and biotechnology; the S&P 600 Small Cap Index rose 14.2%. Mid-cap stocks did even better, with the S&P 400 Mid-Cap Index up 21.5%, but again due to technology. Overall, many stocks did not do well as Fed tightening weighed heavily on performance. The broader S&P 500 Composite Index was up a more modest 10.5%, while the Dow Jones Industrial Average only achieved a 1.2% positive return. Within style categories, growth stocks enjoyed a record advantage over value stocks, a condition which began to reverse only in the last three months of the STI Classic Funds fiscal year. On the fixed income side, total returns in bonds were modest, as typified by the 1.9% gain in the Lehman U.S. Government/Corporate Bond Index for longer term taxable bonds, the 3.5% return in the Merrill Lynch 1-5 Year U.S. Corporate/Government Index, and very modest returns in short to intermediate-term municipal bonds. Within the bond arena, investment grade and high yield bonds were under pressure, while top quality Government bonds prospered. There was a disconnect between risk/reward as equity investors were very positive and bond investors were negative. As the new fiscal year begins for the STI Classic Fund family, we are encouraged by the broadening out of the equity market. Technology stocks have recently corrected significantly and small and mid-caps have done better. Importantly, value oriented stocks outperformed in March/April/May. Tight Fed policy and rising money market rates due to rapid economic growth are not good for stocks. Thus, recent signs of slower economic growth are welcome and stocks will do better once the Fed suspends its tight monetary stance. We also believe the very wide yield spreads available in non-Government fixed income securities will prove rewarding over the next 12-24 months. The STI Classic Funds have never been stronger in terms of product breadth and potential for long-term growth. We thank all Fund shareholders for their confidence in the STI Classic Family. We will work hard to deliver competitive results in the months and years ahead. Sincerely, /s/ signature omitted Douglas S. Phillips President and Chief Investment Officer Trusco Capital Management, Inc. STI CLASSIC FLORIDA TAX-EXEMPT BOND FUND - -------------------------------------------------------------------------------- The STI Classic Florida Tax-Exempt Bond Fund (the "Fund") seeks to provide current income exempt from regular federal income tax for Florida residents and without undue investment risk. We invest in investment grade municipal bonds issued by the state of Florida and its municipalities. In the municipal bond funds we try to limit risk as much as possible. We do not make major maturity shifts. We will bias the Fund based upon our near term fundamental and technical analysis, however, these will be moderate maturity shifts. Our style of investing enables us to enhance performance by utilizing various techniques. One such technique is to emphasize cheap sectors of the yield curve. Also, we take advantage of changes in yield spread. We buy specific bonds when spreads are trading historically wide and sell when the spreads are trading historically narrow. Credit analysis is an important technique especially in today's market. We try to identify and invest in improving credit and avoid those credits that are deteriorating. The underlying concept to all these techniques is to enhance total return without adding risk. The Fund's Trust Shares return from June 1999 to May 2000 was -0.48% versus the Lehman 10-Year Municipal Bond Index and the Lipper Florida Municipal Debt Funds Average, which returned -0.18% and -3.22%, respectively, for the same period. 1999 continued to see the municipal yield curve flatten. The one-year AAA rated municipal bond yield increased 85 basis points for the year, the 5-year AAA rated municipal bond yield increased 88 basis points, and the 10 year and 20 year AAA rated bonds increased 87 and 92 basis points, respectively. In the last half of 1999, the municipal market was dominated by concerns over Y2K. Credit spreads continued to widen with the major credit concerns continuing to come from the healthcare sector. In addition, the fourth quarter was dominated by tax swapping, and the high net worth individual investor reallocating from mutual funds into individual bonds in the intermediate area of the curve. The reallocation of Property and Casualty companies from tax-exempt products to corporate and agencies further reduced the institutional demand for municipals. On-line commerce exploded in 1999 characterized in municipals by the aggressiveness of MuniAuction to make competitive and secondary transactions Internet friendly. A variety of other firms also announced their services and processes that would make municipal transactions on the web more accessible. The challenge for 2000 will be providing the municipal market participants with service and information that is convenient and easy to use. The first quarter of 2000 was positive for municipals despite negative fund flows and limited supply. New issue supply was down nearly 40% from the year before, dramatically affecting activity in the market. As a result, the secondary market continued to develop into a two-tier market. High quality bonds remained liquid while lesser quality bonds received weak bids. The lack of supply was especially burdensome for specialty states like California, Florida, New York, and Tennessee; where paper is normally richer than the general market. Because of the continued flattening of the yield curve, bond structure continues to be an important factor. Twenty-year par bonds trading to a shorter call did not participate as much in the market rally as compared to a discount or non-call bond of the same maturity, which saw substantial principal gains. The portfolio has benefited from our exposure to the 15-20 year area of the curve where we focused on purchasing deep discounts and noncall bonds. We continue to emphasize high quality, good structure bonds and will continue to employ a barbell strategy. Long duration paper will continue to be scarce; therefore non-call and deep discount bonds will continue to be core holdings. /s/ signature omitted Ronald H. Schwartz, CFA, CFP Senior Vice President 2 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date - -0.48% 3.93% 4.57% 4.84% 34.99% [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Florida Lehman 10-Year Lipper Florida Tax-Exempt Bond Fund, Municipal Municipal Trust Shares Bond Index Debt Funds Average Cumulative Returns ($) 1/31/94 $10,000 $10,000 $10,000 5/94 9,786 9,533 9,348 5/95 10,692 10,389 10,201 5/96 11,106 10,880 10,560 5/97 11,908 11,769 11,335 5/98 12,952 12,860 12,358 5/99 13,434 13,455 12,770 5/00 13,370 13,430 12,358 INVESTOR SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date -0.68% 3.73% 4.38% 4.64% 33.47% Without load -4.38% 2.42% 3.58% 4.01% 28.46% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Florida Lehman 10-Year Lipper Florida Tax-Exempt Bond Fund, Municipal Municipal Investor Shares Bond Index Debt Funds Average Cumulative Returns ($) 1/31/94 $ 9,625 $10,000 $10,000 5/94 9,418 9,533 9,348 5/95 10,270 10,389 10,201 5/96 10,656 10,880 10,560 5/97 11,402 11,769 11,335 5/98 12,376 12,860 12,358 5/99 12,814 13,455 12,770 5/00 12,727 13,430 12,358 FLEX SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years to Date To Date -1.17% 3.27% 3.91% 21.10% Without load -3.07% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Florida Lehman 10-Year Lipper Florida Tax-Exempt Bond Fund, Municipal Municipal Flex Shares Bond Index Debt Funds Average Cumulative Returns ($) 6/30/95 $10,000 $10,000 $10,000 5/96 10,424 10,539 10,487 5/97 11,099 11,400 11,257 5/98 11,991 12,456 12,273 5/99 12,367 13,032 12,682 5/00 12,222 13,008 12,273 Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. 3 STI CLASSIC GEORGIA TAX-EXEMPT BOND FUND - -------------------------------------------------------------------------------- The investment objective of the STI Classic Georgia Tax-Exempt Bond Fund (the "Fund") seeks to provide current income exempt from federal and state income taxes for Georgia residents without undue investment risk. Total return for the Fund includes current income as well as changes in the value of the Fund's assets. Returns for the Fund reflect our conservative strategy that tends to better protect our participants from undue principal risk when interest rates rise. Our investment philosophy in the municipal market is to provide our shareholders, as conservative investors, with high quality investments, income stability, and a favorable risk/return ratio. In keeping with our philosophy we look for value within the state of Georgia, utilizing internal as well as outside credit analysis to identify areas in the state that are possible quality upgrade candidates. We monitor shifts within the Georgia market, which may create investment opportunities and subsequently allow the Fund to achieve gains, while at the same time maintaining a geographical diversity to minimize credit risk. Given our philosophy, and in light of the market's volatile nature in recent years, we are maintaining a relatively defensive position. The average maturity and duration may vary slightly in the future however, depending on our outlook for the market. The municipal market was weak during the second half of 1999 as yields for ten-year municipals rose 50 basis points by year-end. Demand was low as investors continued to put money into the stock market. The Federal Reserve, witnessing a continued strong economy and fearful of inflationary pressures, raised rates three times in the second half of 1999. The strength in the economy forced the Federal Reserve to raise rates again several times in early 2000. From May 31, 1999 through May 31, 2000, ten year Treasury yields rose 80 basis points. In comparison for the same period ten year municipal yields rose from 4.50% to 5.20%. The total return for the Fund for the year ended May 31, 2000 was -0.90% (Trust Shares) versus -0.18% for the Lehman 10-Year Municipal Bond Index. The Lipper Georgia Municipal Debt Funds Average, by contrast, posted a total one-year return ended May 31, 2000 of -2.97%. New issue volume in the Georgia market has been fairly light with the exception of a $1 billion Atlanta GA Airport issue in early 2000. Recently, greater demand has reflected renewed investor interest. /s/ signature omitted Gay B. Cash First Vice President 4 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date -0.90% 3.53% 4.25% 3.67% 25.83% [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Georgia Lehman 10-Year Lipper Georgia Tax-Exempt Bond Fund, Municipal Municipal Trust Shares Bond Index Debt Funds Average Cumulative Returns ($) 1/31/94 $10,000 $10,000 $10,000 5/31/94 9,529 9,533 9,338 5/31/95 10,190 10,389 10,124 5/31/96 10,587 10,880 10,495 5/31/97 11,305 11,769 11,300 5/31/98 12,252 12,860 12,359 5/31/99 12,660 13,455 12,759 5/31/00 12,546 13,430 12,380 INVESTOR SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date -1.26% 3.30% 4.10% 3.47% 24.29% Without load -4.95% 1.99% 3.21% 2.85% 19.63% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Georgia Lehman 10-Year Lipper Georgia Tax-Exempt Bond Fund, Municipal Municipal Investor Shares Bond Index Debt Funds Average Cumulative Returns ($) 1/31/94 $ 9,625 $10,000 $10,000 5/31/94 9,171 9,533 9,338 5/31/95 9,786 10,389 10,124 5/31/96 10,147 10,880 10,495 5/31/97 10,804 11,769 11,300 5/31/98 11,696 12,860 12,359 5/31/99 12,062 13,455 12,759 5/31/00 11,910 13,430 12,380 FLEX SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years to Date To Date -1.59% 2.85% 3.38% 17.97% Without load -3.49% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Georgia Lehman 10-Year Lipper Georgia Tax-Exempt Bond Fund, Municipal Municipal Flex Shares Bond Index Debt Funds Average Cumulative Returns ($) 6/30/95 $10,000 $10,000 $10,000 5/31/96 10,370 10,539 10,482 5/31/97 10,998 11,400 11,286 5/31/98 11,850 12,456 12,344 5/31/99 12,161 13,032 12,744 5/31/00 11,968 13,008 12,365 Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. 5 STI CLASSIC HIGH INCOME FUND - -------------------------------------------------------------------------------- The STI Classic High Income Fund commenced operations on March 28, 2000 as the successor to the ESC Strategic Income Fund, which merged into the STI Classic High Income Fund (the "Fund") on that date. The Fund seeks a high level of current income, with a secondary objective of total return. The Fund seeks to achieve its investment objective by investing primarily in high yield debt instruments of U.S. and foreign issuers that are rated below investment grade. (Prior to September 30, 1998, this Fund primarily invested in a diversified portfolio of corporate, government and other debt instruments of U.S. issuers.) Market volatility and investor preference for aggressive equity funds resulted in flows out of income funds in the past year, and this Fund was no exception. Transaction costs associated with meeting substantial outflows hurt the Fund's performance relative to its benchmark. For the fiscal year ended May 31, 2000, the total return for the Fund (Flex Shares) was -10.21% versus -3.21% for the Lehman U.S. Corporate High Yield Bond Index. The Index is not actively managed, and does not include expenses. The Fund's position in liquid assets was increased to meet withdrawals and to facilitate the merger, but we anticipate a more stable asset base in the future. Furthermore, the liquid assets will provide an opportunity to reinvest in securities with better underlying fundamental trends and return opportunities that are consistent with the STI Classic High Income Fund's investment strategy. We will use a "bottom up" investment approach, identifying investment opportunities based on the underlying financial and economic fundamentals of the specific issuer. /s/ signature omitted Agnes G. Pampush, CFA First Vice President 6 FLEX SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000)
Annualized Cumulative Inception Inception Two Months One Year 3 Years 5 Years to Date To Date -0.13% -10.21% -0.10% 1.72% 3.03% 19.87% -2.11% -11.86% With Load
[GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT Cumulative Returns ($) STI Classic Lehman High Income Fund, U.S. Corporate Flex Shares High Yield Bond Index 5/31/94 $10,000 $10,000 5/31/95 11,035 11,348 5/31/96 11,407 12,423 5/31/97 12,055 14,070 5/31/98 12,853 15,830 5/31/99 13,385 15,863 5/31/00 12,018 15,353 (1) Returns prior to March 27, 2000 represent the performance of the ESC Strategic Income Fund, Class A Shares. Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. 7 STI CLASSIC INVESTMENT GRADE BOND FUND - -------------------------------------------------------------------------------- The STI Investment Grade Bond Fund (the "Fund") seeks to provide a high level of total return through current income and capital appreciation as is consistent with the preservation of capital primarily through investment in investment grade fixed income securities. The total return includes not only the current income but also changes in value of the assets held by the Fund. For the year ended May 31, 2000 the Fund's Trust Shares had a total return of -1.76% versus an average return of 1.00% for the Lipper Intermediate Investment Grade Debt Objective. The Lehman U.S. Government/Corporate Bond Index and the Lehman U.S. Aggregate Bond Index (which unlike the Fund, have no expenses) had returns of 1.89% and 2.10%, respectively. Interest rates generally rose over the last year as stronger than expected economic growth continued and inflation concerns rose. The Federal Reserve increased short-term interest rates in an effort to slow economic growth and prevent inflationary pressures from building. Also, during the period the Treasury began a program to buy back Treasury debt with a portion of the budget surplus and focused on the longer-term securities. The result was higher interest rates, an inverted yield curve [interest rates on shorter maturities higher that those on longer maturities] and much wider yields spreads for corporate and mortgage securities. Over the period, two year Treasury yields rose from 5.43% to 6.69%, and thirty year Treasury yields rose from 5.84% to 6.02%. The Fund performed well through the end of March as duration adjustments and Treasury positions added to total return. During April and May, spread widening in corporate securities substantially reduced the Fund's total return. Treasury securities have performed well over the last year as the Treasury buy-back program has focused attention on the dwindling supply of Treasury debt. The Fund is underweighted in mortgage securities and overweighted in corporate positions. Looking forward, as the Federal Reserve slows the economy and reduces inflation concerns, fixed income securities should perform well. The Fund continues to be managed with only moderate shifts in average maturity [duration]. The total return of the Fund is enhanced through yield curve analysis [monitoring and analyzing the risk/reward trade off of different maturity sectors], sector rotation, credit analysis, and other low risk strategies. By actively pursuing these strategies the Fund strives to add to total return while reducing risk. /s/ signature omitted L. Earl Denney, CFA Senior Vice President 8 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date -1.76% 4.34% 4.80% 5.52% 52.71% [GRAPHIC OMITTED] PLOTS POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic Investment Grade Lehman U.S. Lipper Intermediate Bond Fund, Government/Corporate Investment Grade Trust Shares Bond Index Debt Objective Cumulative Returns ($) 7/31/92 $10,000 $10,000 $10,000 5/93 10,736 10,788 10,725 5/94 10,861 10,897 10,804 5/95 11,990 12,162 11,913 5/96 12,472 12,660 12,365 5/97 13,344 13,661 13,318 5/98 14,801 15,229 14,651 5/99 15,430 15,847 15,143 5/00 15,158 16,147 15,295
INVESTOR SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date -2.17% 3.93% 4.39% 5.21% 49.91% Without load -5.81% 2.60% 3.59% 4.70% 44.29% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Investment Grade Lehman U.S. Lipper Intermediate Bond Fund, Government/Corporate Investment Grade Investor Shares Bond Index Debt Objective Cumulative Returns ($) 6/30/92 $ 9,625 $10,000 $10,000 5/93 10,486 11,064 10,978 5/94 10,576 11,176 11,058 5/95 11,638 12,473 12,984 5/96 12,045 12,984 12,656 5/97 12,847 14,010 13,632 5/98 14,195 15,619 14,997 5/99 14,743 16,253 15,501 5/00 14,423 16,560 15,656 FLEX SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years to Date To Date -2.63% 3.44% 3.80% 20.39% Without load -4.48% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Investment Grade Lehman U.S. Lipper Intermediate Bond Fund, Government/Corporate Investment-Grade Investor Shares Bond Index Debt Objective Cumulative Returns ($) 6/30/95 $10,000 $10,000 $10,000 5/96 10,232 10,327 10,316 5/97 10,862 11,143 11,111 5/98 11,948 12,422 12,223 5/99 12,348 12,927 12,634 5/00 12,023 13,171 12,761 Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. 9 STI CLASSIC INVESTMENT GRADE TAX-EXEMPT BOND FUND - -------------------------------------------------------------------------------- The STI Classic Investment Grade Tax-Exempt Bond Fund (the "Fund") seeks to provide high total return through (i) current income exempt from federal income taxes and (ii) capital appreciation, while preserving the principal amount invested by investing in investment grade tax-exempt obligations. In the municipal bond funds we try to limit risk as much as possible. We do not make major maturity shifts. We will bias the Fund based upon our near term fundamental and technical analysis, however, these will be moderate maturity shifts. Our style of investing enables us to enhance performance by utilizing various techniques. One such technique is to emphasize cheap sectors of the yield curve. Also, we take advantage of changes in yield spread. We buy specific bonds when spreads are trading historically wide and sell when the spreads are trading historically narrow. Credit analysis is an important technique especially in today's market. We try to identify and invest in improving credit and avoid those credits that are deteriorating. The underlying concept to all these techniques is to enhance total return without adding risk. The Fund's Trust Shares return from June 1999 to May 2000 was 1.41% versus the Lipper Intermediate Municipal Debt Average, which returned -1.04% for the same period. The Lehman 5-Year Municipal Bond Index and the Lehman 5-Year General Obligation Index returned 0.75% and 0.66%, respectively. 1999 continued to see the municipal yield curve flatten. The one-year AAA rated municipal bond yield increased 85 basis points for the year; the 5-year AAA rated municipal bond yield increased 88 basis points, and the 10 year and 20 year AAA rated bonds increased 87 and 92 basis points, respectively. In the last half of 1999 the municipal market was dominated by concerns over Y2K. Credit spreads continued to widen with the major credit concerns continuing to come from the healthcare sector. In addition, the fourth quarter was dominated by tax swapping, and the high net worth individual investor reallocating from mutual funds into individual bonds in the intermediate area of the curve. The reallocation of Property and Casualty companies from tax-exempt products to corporate and agencies further reduced the institutional demand for municipals. On-line commerce exploded in 1999 characterized in municipals by the aggressiveness of MuniAuction to make competitive and secondary transactions Internet friendly. A variety of other firms also announced their services and processes that would make municipal transactions on the web more accessible. The challenge for 2000 will be providing the municipal market participants with service and information that is convenient and easy to use. The first quarter of 2000 was positive for municipals despite negative fund flows and limited supply. New issue supply was down nearly 40% from the year before, dramatically affecting activity in the market. As a result, the secondary market continued to develop into a two-tier market. High quality bonds remained liquid while lessor quality bonds received weak bids. The lack of supply was especially burdensome for specialty states like California, Florida, New York, and Tennessee, where paper is normally richer than the general market. Because of the continued flattening of the yield curve, bond structure continues to be an important factor. Twenty-year par bonds trading to a shorter call did not participate as much in the market rally as compared to a discount or non-call bond of the same maturity, which saw substantial principal gains. The portfolio has benefited from our exposure to the 15-20 year area of the curve where we focused on purchasing deep discounts and noncall bonds. We continue to emphasize high quality, good structure bonds and will continue to employ a barbell strategy. Long duration paper will continue to be scarce; therefore non-call and deep discount bonds will continue to be core holdings. /s/ signature omitted Ronald H. Schwartz, CFA, CFP Senior Vice President 10 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date to Date 1.41% 4.84% 5.49% 5.49% 42.39% [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic Investment Grade Lehman 5-Year Lehman 5-Year Lipper Intermediate Tax-Exempt Bond Fund, Municipal General Obligation Municipal Trust Shares Bond Index Index Debt Average Cumulative Returns ($) 10/31/93 $10,000 $10,000 $10,000 $10,000 5/94 9,976 9,894 9,943 9,831 5/95 10,995 10,600 10,627 10,536 5/96 11,634 11,092 11,131 10,962 5/97 12,462 11,755 11,807 11,666 5/98 13,530 12,543 12,629 12,543 5/99 14,162 13,145 13,248 13,012 5/00 14,362 13,243 13,335 12,877
INVESTOR SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date 0.90% 4.39% 5.05% 6.50% 65.30% Without load -2.86% 3.06% 4.25% 5.99% 59.09% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic Investment Grade Lehman 5-Year Lehman 5-Year Lipper Intermediate Tax-Exempt Bond Fund, Municipal General Obligation Municipal Investor Shares Bond Index Index Debt Average Cumulative Returns ($) 6/30/92 $ 9,625 $10,000 $10,000 $10,000 5/93 10,731 10,775 10,778 10,898 5/94 11,309 11,088 11,112 11,231 5/95 12,429 11,879 11,877 12,037 5/96 13,101 12,430 12,440 12,524 5/97 13,977 13,174 13,196 13,328 5/98 15,101 14,056 14,114 14,330 5/99 15,758 14,731 14,806 14,866 5/00 15,900 14,841 14,904 14,711
FLEX SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years to Date To Date 0.52% 3.89% 4.56% 24.92% Without load -1.40% With load [GRAPHIC OMITTED] PLOT POINTS ARE As FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic Investment Grade Lehman 5-Year Lehman 5-Year Lipper Intermediate Tax-Exempt Bond Fund, Municipal General Obligation Municipal Flex Shares Bond Index Index Debt Average Cumulative Returns ($) 6/30/95 $10,000 $10,000 $10,000 $10,000 5/96 10,541 10,446 10,465 10,453 5/97 11,193 11,071 11,102 11,125 5/98 12,033 11,812 11,874 11,961 5/99 12,487 12,379 12,456 12,409 5/00 12,522 12,472 12,539 12,279
Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. The line graphs compare the Fund's returns to those of the Lehman 5-Year Municipal Bond Index. Previously, the Fund's returns had been compared to the Lehman 5-Year General Obligation Index, but the adviser believes that the Lehman 5-Year Municipal Bond Index, because of its emphasis on revenue bonds as well as general obligation bonds, more accurately reflects the types of securities in which the Fund invests. 11 STI CLASSIC LIMITED-TERM FEDERAL MORTGAGE SECURITIES FUND - -------------------------------------------------------------------------------- The one-year investment period ending in May was not a particularly fruitful one for fixed income investors. Economic prosperity of historic proportion resulted in GDP growth well above the Federal Reserve's targeted, non-inflationary growth rate. As a result, the Federal Reserve raised the Federal Funds rate six times bringing rates from 4.75% to 6.5%. This activity resulted in generally higher rates across the bond market and a general decline in bond prices. With such vibrant growth, corporate and individual prosperity yielded an unexpected windfall of tax receipts to the U.S. Treasury. With the budget in surplus, the Treasury announced a buy back program that would retire a significant amount of outstanding treasury debt. As a result, Treasuries were the best performing sector of the fixed income market. The STI Classic Limited-Term Federal Mortgage Securities Fund's (the "Fund") Trust Shares returned 2.33% for the year ended May 31, 2000 versus the Merrill Lynch 1-5 Year U.S. Treasury Index and the Lipper Short/Intermediate U.S. Government Average which returned 3.80% and 2.11%, respectively. The preponderance of incremental return was achieved by a successful sector rotation strategy that had the Fund heavily invested in income-earning, agency mortgage securities for the first half of the investment period, which were then sold to purchase a defensive position of cash and intermediate-term maturity Treasuries. Prospects for both Fannie Mae and Freddie Mac straight issue debts as well as mortgage collateral are beginning to look attractive again on a relative value basis, as these securities begin to reflect the full risk of potential regulation changes. The Fund's manager will continue to monitor the relative value and likely return prospects of these securities, as congressional debate over re-regulation of Government sponsored entities continues. The high level of income and minimum exposure to credit risk produced by the fund investments in balance should continue to provide investors with good return prospects relative to other fixed income investment options. /s/ signature omitted David E. West, CFA Senior Vice President 12 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date 2.33% 4.71% 5.08% 5.49% 37.73% [GRAPHIC OMITTED] PLOT POINT ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic Limited-Term Federal Merrill Lynch Lipper Short/ Mortgage Securities Fund, 1-5 Year U.S. Intermediate U.S. Trust Shares Treasury Index Government Average Cumulative Returns ($) 6/30/94 $10,000 $10,000 $10,000 5/95 10,756 10,809 10,744 5/96 11,276 11,341 11,189 5/97 12,002 12,110 11,917 5/98 12,856 13,040 12,790 5/99 13,467 13,722 13,289 5/00 13,780 14,243 13,569
INVESTOR SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date 1.93% 4.43% 4.81% 5.36% 35.88% Without load -0.57% 3.54% 4.28% 4.90% 32.43% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic Limited-Term Federal Merrill Lynch Lipper Short/ Mortgage Securities Fund, 1-5 Year U.S. Intermediate U.S. Investor Shares Treasury Index Government Average 7/31/94 $10,000 $10,000 $10,000 5/95 10,440 10,697 10,636 5/96 10,919 11,223 11,078 5/97 11,593 11,984 11,798 5/98 12,398 12,904 12,662 5/99 12,953 13,579 13,156 5/00 13,203 14,095 13,434
FLEX SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years to Date To Date 1.71% 4.09% 4.44% 24.14% Without load -0.22% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Limited-Term Federal Merrill Lynch Lipper Short/ Mortgage Securities Fund, 1-5 Year U.S. Intermediate U.S. Flex Shares Treasury Index Government Average 6/30/95 $10,000 $10,000 $10,000 5/96 10,393 10,431 10,361 5/97 10,996 11,139 11,035 5/98 11,709 11,994 11,844 5/99 12,194 12,621 12,306 5/00 12,402 13,101 12,565 Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. 13 STI CLASSIC MARYLAND MUNICIPAL BOND FUND - -------------------------------------------------------------------------------- This marks the first anniversary of the STI Classic Maryland Municipal Bond Fund (the "Fund") as a member of the STI Classic family of mutual funds, and it is one we are proud to celebrate. STI Classic Funds are a diversified group of mutual funds, including stock, bond and money market funds with investment styles within each asset class designed to meet the needs of our clients. The Fund is a long-term maturity bond fund that invests in tax-exempt bonds primarily from the state of Maryland. The Fund seeks to maximize tax-free investment income for our clients, using a diversified mix of high-quality securities representing the various state and local entities within the state. The past year has been remarkable for the economy, as the length of the current expansion reached an all-time record. Consumer spending remained robust through much of the period, while the industrial and manufacturing side of the economy rebounded on signs of global recovery. These factors helped generate new jobs and new tax revenue for state and local governments in Maryland and across the nation. Unfortunately, the Federal Reserve (the "Fed") became concerned that the pace of growth might push inflation higher if left unchecked. So it spent much of the past year raising short-term interest rates in an attempt to cool the red-hot consumer. This provided a challenging market for bond investors of all persuasions and municipal bond investors in particular. The Fund, with its heavy emphasis on generating high levels of tax-free income, shared in the overall municipal market decline. However, we continued to emphasize high-quality securities from well-managed entities; entities that we believe will weather the more restrictive climate created by the Fed. The Fund's Trust Shares returned -1.78% for the year ended May 31, 2000 versus -0.50% for the Lehman General Obligation Index. The outlook for the coming fiscal year is encouraging. The economy appears to be showing early signs that the interest rate hikes of the past year may be slowing the interest sensitive areas of the economy. This could reduce the risk of a sharp acceleration in inflation and limit further interest rate increases by the Fed. We are also encouraged that investors have begun to return to bonds as an important element of a well-diversified portfolio. We want to take this opportunity to thank you for choosing the STI Classic Maryland Municipal Bond Fund as part of your portfolio. We will continue to invest to maximize tax-exempt income with a portfolio of high-quality securities, and we look forward to what we believe will be a more favorable year for bond investors. /s/ signature omitted Robert S. Bowman, CFA Vice President 14 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years to Date To Date -1.78% 3.71% 3.00% 13.39% [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Maryland Lehman Municipal Bond Fund, General Obligation Trust Shares(1) Bond Index Cumulative Returns ($) 3/31/96 $10,000 $10,000 5/96 9,846 9,949 5/97 10,500 10,767 5/98 11,443 11,734 5/99 11,923 12,300 5/00 11,710 12,239 FLEX SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years to Date To Date -2.66% 2.80% 3.29% 14.18% Without load -4.54% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Maryland Lehman Municipal Bond Fund, General Obligation Flex Shares(1) Bond Index 4/30/96 $10,000 $10,000 5/96 9,936 9,984 5/97 10,514 10,805 5/98 11,366 11,775 5/99 11,735 12,344 5/00 11,423 12,282 (1) Returns prior to May 24, 1999 represent the performance of the CrestFund Maryland Municipal Bond Fund. Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. 15 STI CLASSIC SHORT-TERM BOND FUND - -------------------------------------------------------------------------------- The investment objective of the STI Classic Short-Term Bond Fund (the "Fund") is to provide high current income while preserving capital primarily through investment in short to intermediate-term investment grade fixed income securities. The Fund attempts to capture the yield advantage which normally exists between money market instruments and short to intermediate-term bonds. The price volatility of short to intermediate-term bonds is moderate and over time it consistently has been offset by the incremental yield these instruments offer relative to money market securities. The Fund is managed from a total return perspective; that is, day-to-day decisions are made with a view towards maximizing income and price appreciation. The investment discipline applied in managing the Fund emphasizes adding value through yield curve, sector and credit analysis. Investments are made in those sectors, credits, and segments of the yield curve within the applicable universe which offers the most attractive risk-reward trade-offs. For example, we study historical yield spread data of the corporate and mortgage sectors and compare it with the current environment to identify buying and selling opportunities between various sectors. We also use internal credit analysis and screening to identify opportunities in corporate bonds. We look for those instruments that offer incremental yield for a given level of credit risk. The total return earned by the Fund over the last twelve months was 2.87% (Trust Shares), as compared to 4.11% for the Salomon 1-3 Year Treasury/Government Sponsored/Corporate Index (the "Index"). The Index is not actively managed, and does not include expenses. Tighter monetary policy pushed up interest rates in past year, hurting the Fund's return. During the year ended May 31, 2000, the Fund had a significant portion of its portfolio invested in corporate securities in an effort to enhance the Fund's yield. Corporates underperformed treasuries during that period, which negatively impacted the Fund's performance. However, we believe that in the long-term this strategy will enable us to achieve the Fund's objective. /s/ signature omitted Agnes G. Pampush, CFA First Vice President 16 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date to Date 2.87% 4.73% 4.98% 4.91% 41.30% [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Short-Term Salomon 1-3 Year Bond Fund, Treasury/Government Trust Shares Sponsored/Corporate Index Cumulative Returns ($) 3/31/93 $10,000 $10,000 5/93 10,035 10,039 5/94 10,238 10,260 5/95 11,016 11,021 5/96 11,506 11,614 5/97 12,231 12,384 5/98 13,125 13,254 5/99 13,658 13,968 5/00 14,050 14,542 INVESTOR SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date 2.67% 4.56% 4.78% 4.64% 38.57% Without load -0.65% 3.87% 4.36% 4.34% 35.73% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Short-Term Salomon 1-3 Year Bond Fund, Treasury/Government Investor Shares Sponsored/Corporate Index Cumulative Returns ($) 3/31/93 $ 9,800 $10,000 5/93 9,838 10,039 5/94 10,017 10,260 5/95 10,762 11,021 5/96 11,218 11,614 5/97 11,887 12,384 5/98 12,742 13,254 5/99 13,236 13,968 5/00 13,590 14,542 FLEX SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) CUMULATIVE RETURNS ($) Annualized Cumulative Inception Inception One Year 3 Years to Date To Date 2.31% 4.20% 4.41% 23.72% Without load 0.36% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Short-Term Salomon 1-3 Year Bond Fund, Treasury/Government Flex Shares Sponsored/Corporate Index Cumulative Returns ($) 6/30/95 $10,000 $10,000 5/96 10,359 10,481 5/97 10,941 11,176 5/98 11,689 11,962 5/99 12,098 12,606 5/00 12,378 13,124 Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. 17 STI CLASSIC SHORT-TERM U.S. TREASURY SECURITIES FUND - -------------------------------------------------------------------------------- The investment objective of the STI Classic Short-Term U.S. Treasury Securities Fund (the "Fund") is to provide high current income while preserving capital through investment exclusively in short-term U.S. Treasury securities. The goal of the Fund is to capture the yield advantage, which normally exists between money market instruments and short-term bonds. The price volatility of short-term bonds is very modest and over time has consistently been offset by the incremental yield of these instruments relative to money market securities. The Fund is managed from a total return perspective, that is, day to day decisions are made with a view toward maximizing income and price appreciation. The investment discipline applied in managing the Fund emphasizes adding value through yield curve analysis. Investments are made in those segments of the yield curve within the applicable universe, which offer the most attractive risk/reward trade-off. Total returns for fixed income securities and fixed income funds were negatively impacted by rising interest rates during the one year period ending May 31, 2000. The Fund had a total return of 3.75% (Trust Shares) for the one year period. The Fund maintained a shorter than average maturity for most of the period which allowed the Fund to outperform the Salomon 1-3 Year Treasury Index (the "Index"). The Index (which does not include fees or expenses) had a 4.12% total return for the same period. /s/ signature omitted David S. Yealy Vice President 18 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date 3.75% 4.87% 5.02% 4.69% 39.17% [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic Short-Term U.S. Salomon Salomon Treasury Securities Fund, 1-3 Year 6-Month Treasury Trust Shares Treasury Index Bill Index Cumulative Returns ($) 3/31/93 $10,000 $10,000 $10,000 5/93 10,024 10,036 10,053 5/94 10,242 10,244 10,391 5/95 10,868 10,991 10,953 5/96 11,382 11,523 11,554 5/97 12,038 12,333 12,176 5/98 12,796 13,194 12,837 5/99 13,384 13,896 13,474 5/00 13,885 14,467 14,180
INVESTOR SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date 3.58% 4.71% 4.85% 4.53% 37.58% Without load 2.55% 4.36% 4.64% 4.38% 36.22% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic Short-Term U.S. Salomon Salomon Treasury Securities Fund, 1-3 Year 6-Month Treasury Investor Shares Treasury Index Bill Index 3/31/93 $ 9,900 $10,000 $10,000 5/31/93 9,921 10,036 10,053 5/31/94 10,122 10,244 10,391 5/31/95 10,732 10,991 10,953 5/31/96 11,217 11,523 11,554 5/31/97 11,844 12,333 12,176 5/31/98 12,559 13,194 12,837 5/31/99 13,130 13,896 13,474 5/31/00 13,599 14,467 14,180
FLEX SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years to Date To Date 3.34% 4.51% 4.51% 24.30% Without load 1.36% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic Short-Term U.S. Salomon Salomon Treasury Securities Fund, 1-3 Year 6-Month Treasury Flex Shares Treasury Index Bill Index 6/30/95 $10,000 $10,000 $10,000 5/96 10,357 10,428 10,500 5/97 10,894 11,161 11,065 5/98 11,537 11,940 11,666 5/99 12,036 12,576 12,244 5/00 12,438 13,092 12,886
Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. 19 STI CLASSIC U.S. GOVERNMENT SECURITIES FUND - -------------------------------------------------------------------------------- The objective for the STI Classic U.S. Government Securities Fund (the "Fund") is to provide high current income while preserving capital by investing in obligations issued or guaranteed by the U.S. Government or its agencies or instrumentalities. The Fund met its objectives for the fiscal year of operations ending May 31, 2000. Approximately 86% of the Fund's assets were invested in Government Agency mortgage-backed securities with the balance invested in U.S. Government Securities. The Fund had a 30-day yield of 6.3%. During the 12-month period ending May 31, 2000, interest rates rose significantly as the Federal Reserve pursued an aggressive tightening policy, which negatively impacted total return. In addition, the incremental yield spreads offered by mortgage-backed securities widened significantly, and we have used this opportunity to increase our exposure to this sector. The Fund's total return (Trust Shares) of 1.63% compares very favorably to the total return of the Lipper Intermediate U.S. Government Funds Average of 1.33% for the 1 year time period. The Merrill Lynch Government/Mortgage Index returned 2.81% for the same period. We believe the Federal Reserve is nearing the end of its tightening bias as economic growth begins to slow and inflation remains controlled. The Fund is well positioned to take advantage of this less volatile environment. /s/ signature omitted Charles B. Leonard, CFA First Vice President 20 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date 1.63% 5.36% 5.26% 5.99% 40.41% [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT
STI Classic U.S. Government Merrill Lynch Lipper Intermediate Securities Fund, Government/Mortgage Government Trust Shares Index* Funds Average Cumulative Returns ($) 6/30/94 $ 9,625 $10,000 $10,000 5/95 10,572 11,138 10,907 5/96 10,833 11,627 11,271 5/97 11,614 12,572 12,055 5/98 12,802 13,920 13,167 5/99 13,257 14,563 13,618 5/00 13,415 14,972 13,800
INVESTOR SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date to Date 1.19% 4.92% 4.88% 5.50% 37.81% Without load -2.60% 3.60% 4.08% 4.83% 32.64% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic U.S. Government Merrill Lynch Lipper Intermediate Securities Fund, Government/Mortgage Government Investor Shares Index* Funds Average PLOT POINTS TO COME??? FLEX SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years to Date to Date 0.70% 4.42% 4.25% 23.02% Without load -1.22% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic U.S. Government Merrill Lynch Lipper Intermediate Securities Fund, Government/Mortgage Government Investor Shares Index* Funds Average Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. *The Merrill Government/Mortgage Index is a synthetic index created by combining, at their respective market weights: (i) the Merrill Lynch Government Master Index, which is a widely-recognized index comprised of U.S. Treasury securities and U.S. Government agency securities with a maturity of at least one year; and (ii) the Merrill Lynch Mortgage Master Index, which is a widely-recognized market value-weighted index comprised of mortgage- backed securities including 15 and 30 year single family mortgages in addition to aggregate pooled mortgages. 21 STI CLASSIC VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND - -------------------------------------------------------------------------------- This marks the first anniversary of the STIClassic Virginia Intermediate Bond Fund (the "Fund") as a member of the STI Classic family of mutual funds, and it is one we are proud to celebrate. STI Classic Funds are a diversified group of mutual funds, including stock, bond and money market funds with investment styles within each asset class designed to meet the needs of our clients. The Fund is an intermediate term maturity bond fund that invests in tax-exempt bonds primarily from the state of Virginia. The Fund seeks to maximize tax-free investment income for our clients, using a diversified mix of high-quality securities representing the various state and local entities within the Commonwealth. The past year has been remarkable for the economy, as the length of the current expansion reached an all-time record. Consumer spending remained robust through much of the period, while the industrial and manufacturing side of the economy rebounded on signs of global recovery. These factors helped generate new jobs and new tax revenue for state and local governments in Virginia and across the nation. Unfortunately, the Federal Reserve (the "Fed") became concerned that the pace of growth might push inflation higher if left unchecked. So it spent much of the past year raising short-term interest rates in an attempt to cool the red-hot consumer. This provided a challenging market for bond investors of all persuasions and municipal bond investors in particular. The Fund, with its heavy emphasis on generating high levels of tax-free income, shared in the overall municipal market decline. However, we continued to emphasize high-quality securities from well-managed entities; entities that we believe will weather the more restrictive climate created by the Fed. The Fund (Trust Shares) returned -1.31% for the year ended May 31, 2000 versus the Lehman 5-Year General Obligation Index which returned -0.50%. The outlook for the coming fiscal year is encouraging. The economy appears to be showing early signs that the interest rate hikes of the past year may be slowing the interest sensitive areas of the economy. This could reduce the risk of a sharp acceleration in inflation and limit further interest rate increases by the Fed. We are also encouraged that investors have begun to return to bonds as an important element of a well-diversified portfolio. We want to take this opportunity to thank you for choosing the STI Classic Virginia Intermediate Municipal Bond Fund as part of your portfolio. We will continue to invest to maximize tax-exempt income with a portfolio of high-quality securities, and we look forward to what we believe will be a more favorable year for bond investors. /s/ signature Robert S. Bowman, CFA Vice President 22 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date -1.31% 3.12% 3.79% 4.08% 34.34% [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Virginia Intermediate Lehman 5-Year Municipal Bond Fund, General Obligation Trust Shares Bond Index Cumulative Returns ($) 5/31/93 $10,000 $10,000 5/93 10,282 10,246 5/94 10,280 10,563 5/95 11,089 11,290 5/96 11,494 11,825 5/97 12,179 12,544 5/98 13,078 13,417 5/99 13,532 14,075 5/00 13,355 14,168 INVESTOR SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date -1.24% 3.18% 3.82% 3.73% 29.62% Without load -4.97% 1.89% 3.03% 3.17% 24.75% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Virginia Intermediate Lehman 5-Year Municipal Bond Fund, General Obligation Investor Shares(1) Bond Index 5/31/93 $ 9,625 $10,000 5/94 9,623 10,310 5/95 10,369 11,019 5/96 10,746 11,542 5/97 11,386 12,243 5/98 12,236 13,096 5/99 12,664 13,737 5/00 12,507 13,828 (1) Returns prior to May 24, 1999 represent the performance of the CrestFund Virginia Intermediate Municipal Bond Fund. Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. 23 STI CLASSIC VIRGINIA MUNICIPAL BOND FUND - -------------------------------------------------------------------------------- This marks the first anniversary of the STI Classic Virginia Municipal Bond Fund (the "Fund") as a member of the STI Classic family of mutual funds, and it is one we are proud to celebrate. STI Classic Funds are a diversified group of mutual funds, including stock, bond and money market funds with investment styles within each asset class designed to meet the needs of our clients. The Fund is a longer-term maturity bond fund that invests in tax-exempt bonds primarily from the state of Virginia. The Fund seeks to maximize tax-free investment income for our clients, using a diversified mix of high-quality securities representing the various state and local entities within the Commonwealth. The past year has been remarkable for the economy, as the length of the current expansion reached an all-time record. Consumer spending remained robust through much of the period, while the industrial and manufacturing side of the economy rebounded on signs of global recovery. These factors helped generate new jobs and new tax revenue for state and local governments in Virginia and across the nation. Unfortunately, the Federal Reserve (the "Fed") became concerned that the pace of growth might push inflation higher if left unchecked. So it spent much of the past year raising short-term interest rates in an attempt to cool the red-hot consumer. This provided a challenging market for bond investors of all persuasions and municipal bond investors in particular. The Fund, with its heavy emphasis on generating high levels of tax-free income, shared in the overall municipal market decline. However, we continued to emphasize high-quality securities from well-managed entities; entities that we believe will weather the more restrictive climate created by the Fed. The Fund's Trust Shares returned -3.18% for the fiscal year ended May 31, 2000 versus the Lehman General Obligation Bond Index which returned -0.50%. The outlook for the coming fiscal year is encouraging. The economy appears to be showing early signs that the interest rate hikes of the past year may be slowing the interest sensitive areas of the economy. This could reduce the risk of a sharp acceleration in inflation and limit further interest rate increases by the Fed. We are also encouraged that investors have begun to return to bonds as an important element of a well-diversified portfolio. We want to take this opportunity to thank you for choosing the STI Classic Virginia Municipal Bond Fund as part of your portfolio. We will continue to invest to maximize tax-exempt income with a portfolio of high-quality securities, and we look forward to what we believe will be a more favorable year for bond investors. /s/ signature omitted Robert S. Bowman, CFA Vice President 24 TRUST SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date to Date -3.18% 3.17% 3.73% 4.17% 23.41% [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Virginia Lehman Municipal Bond Fund, General Obligation Trust Shares(1) Bond Index Cumulative Returns ($) 4/30/95 $10,000 $10,000 5/95 10,333 10,298 5/96 10,568 10,779 5/97 11,302 11,665 5/98 12,356 12,712 5/99 12,820 13,326 5/00 12,412 13,260 INVESTOR SHARES AVERAGE ANNUAL TOTAL RETURNS (PERIODS ENDED MAY 31, 2000) Annualized Cumulative Inception Inception One Year 3 Years 5 Years to Date To Date -4.13% 2.25% 2.84% 3.17% 17.31% Without load -5.98% With load [GRAPHIC OMITTED] PLOT POINTS ARE AS FOLLOWS: COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT STI Classic Virginia Lehman Municipal Bond Fund, General Obligation Flex Shares(1) Bond Index Cumulative Returns ($) 4/30/95 $10,000 $10,000 5/95 10,336 10,298 5/96 10,480 10,779 5/97 11,121 11,665 5/98 12,051 12,712 5/99 12,400 13,326 5/00 11,888 13,260 (1) Returns prior to May 24, 1999 represent the performance of the CrestFund Virginia Municipal Bond Fund. Past performance is no indication of future performance. The Funds' comparative benchmarks do not include the annual operating expenses incurred by the Fund. 25 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 FLORIDA TAX-EXEMPT BOND FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MUNICIPAL BONDS (89.2%) FLORIDA (79.5%) Brevard County, Health Facilities Authority, Holmes Regional Medical Center Project, RB, MBIA Callable 10/01/03 @ 102 5.700%, 10/01/08 $3,000 $ 3,038 Broward County, Port Facilities Authority, Ser C, RB, AMT, MBIA 5.375%, 09/01/08 3,360 3,339 Citrus County, Pollution Control Authority, Florida Power, Crystal River, Ser B, RB Callable 08/01/02 @ 102 6.350%, 02/01/22 335 337 Dade County, Aviation, Ser A, RB, AMBAC Callable 10/01/05 @ 102 6.000%, 10/01/09 500 520 Dade County, Aviation Revenue, Ser B, RB, AMT, MBIA Callable 10/01/02 @ 102 6.600%, 10/01/22 825 844 Dade County, Educational Facilities Authority, University of Miami, Ser A, RB, MBIA 6.000%, 04/01/08 505 527 Dade County, Seaport, GO, MBIA 6.500%, 10/01/09 1,000 1,084 Dade County, Ser CC, GO, AMBAC 7.125%, 10/01/15 1,000 1,149 Daytona Beach, Water & Sewer Authority, Ser 1978, RB, ETM Callable 11/15/00 @ 101.75 6.750%, 11/15/07 1,000 1,050 Deerfield Beach, Water & Sewer Authority, RB, FGIC 6.125%, 10/01/06 250 259 Florida State, Board of Education, Capital Outlay, Public Education, Ser B, GO Prerefunded @ 101(F) 6.000%, 06/01/01 1,000 1,022 Florida State, Board of Education, Capital Outlay, Public Education, GO Callable 06/01/02 @ 101 6.400%, 06/01/19 1,300 1,340 Florida State, Board of Education, Capital Outlay, Ser A, GO Callable 01/01/09 @ 101 4.750%, 01/01/19 1,860 1,579 Florida State, Board of Education, Capital Outlay, Ser A, GO 6.100%, 06/01/00 125 125 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- FLORIDA--CONTINUED Florida State, Board of Education, Capital Outlay, Ser C, ETM, GO Callable 06/22/00 @ 100 7.100%, 06/01/07 $ 190 $ 192 Florida State, Department of Transportation, Right of Way, Ser A, GO Callable 07/01/07 @ 101 5.000%, 07/01/22 500 434 Florida State, Finance Department of General Services, Environmental Preservation 2000, Ser A, RB, AMBAC Callable 07/01/07 @ 101 5.000%, 07/01/13 1,200 1,138 Florida State, Finance Department of General Services, Environmental Protection, Ser B, RB, AMBAC 6.000%, 07/01/12 2,000 2,093 Florida State, Finance Department of General Services, Save Our Coast, Department of National Resources, RB, MBIA Prerefunded @ 101 (F) 6.500%, 07/01/01 720 740 Florida State, Finance Department of General Services, Department of Natural Resources, Preservation 2000, Ser A, RB, AMBAC Prerefunded @ 102 (F) 6.750%, 07/01/01 80 83 Florida State, Housing Financing Authority, Homeowner Mortgage, Ser 7, RB, AMT, FSA Callable 07/01/09 @ 100 5.200%, 01/01/31 1,000 977 Florida State, Ports Financing Commission, Transportation Trust Fund, RB, AMT, FGIC Callable 10/01/09 @ 101 5.250%, 10/01/13 1,305 1,244 5.375%, 10/01/15 1,000 951 Florida State, Turnpike Authority, Ser A, RB, FSA Callable 07/01/09 @ 101 5.000%, 07/01/22 3,545 3,083 Gainesville, Utility Systems, Ser A, RB 5.750%, 10/01/04 1,000 1,026 Hillsborough County, Industrial Development Authority, University Community Hospital, RB, MBIA 6.500%, 08/15/19 145 157 26 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- FLORIDA--CONTINUED Indian, Trace Community, Community Development District, Water Management Split Benefit, Ser A-1, RB, MBIA Callable 05/01/05 @ 102 5.500%, 05/01/07 $ 330 $ 335 Jacksonville, Excise Tax, Ser B, RB, AMT, FGIC Callable 10/01/01 @ 101 5.200%, 10/01/04 1,500 1,499 Jacksonville, Sales Tax Authority, River City Renaissance Project, RB, FGIC 6.000%, 10/01/04 2,430 2,517 Keys, Aqueduct Authority, RB, AMBAC Prerefunded @ 101(F) 6.750%, 09/01/01 170 176 Lakeland, Electric & Water Authority, First Lien, Ser B, RB, FSA 6.550%, 10/01/05 2,590 2,753 Lakeland, Electric & Water Authority, First Lien, Ser C, RB, FSA 6.050%, 10/01/07 1,000 1,050 Lee County, Industrial Development Authority, Bonita Springs Utilities Project, RB, AMT, MBIA Callable 11/01/06 @ 101 5.750%, 11/01/10 1,480 1,498 Lee County, Water & Sewer Authority, Ser A, RB, AMBAC Callable 10/01/09 @ 101 4.750%, 10/01/19 1,720 1,460 Miami, Parking Facilities Authority, RB, MBIA 5.250%, 10/01/15 1,000 959 Miami-Dade County, Educational Authority, Ser A, RB, AMBAC Callable 04/01/10 @ 101 5.500%, 04/01/19 1,405 1,346 North Broward, Hospital District, RB, ETM, MBIA 5.950%, 01/01/01 1,000 1,008 Orange County, Health Facilities Authority, Ser A, RB, ETM, MBIA 6.250%, 10/01/07 2,120 2,245 Orlando, Aviation Authority, Airport Facilities, RB, AMT, FGIC 5.250%, 10/01/13 725 692 5.500%, 10/01/17 1,810 1,755 Orlando, Aviation Authority, Airport Facilities, Ser A, RB, AMT, AMBAC Callable 10/01/03 @ 102 5.400%, 10/01/06 1,340 1,344 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- FLORIDA--CONTINUED Orlando, Utilities Commission Water & Sewer Authority, Sub-Ser D, RB 6.750%, 10/01/17 $5,385 $ 5,991 Osceola County, School Board Certificates Authority, Ser A, COP, AMBAC 6.250%, 06/01/01 1,080 1,097 Palm Beach County, Acquisitions Program Authority, Ser B, GO Callable 08/01/09 @101 5.375%, 08/01/15 1,000 968 Palm Beach County, Apartment System Authority, RB, MBIA Callable 10/01/01 @ 102 7.625%, 10/01/04 1,410 1,482 Palm Beach County, Solid Waste Authority, Ser A, RB, ETM, AMBAC 6.000%, 10/01/09 300 315 Pensacola, Airport Authority, Ser A, RB, AMT, MBIA 6.250%, 10/01/09 505 532 Pensacola, Airport Authority, Ser A, RB, AMT, MBIA Callable 10/01/08 @ 102 6.000%, 10/01/12 1,075 1,102 Pinellas County, Health Facilities Authority, Morton Plant Health Systems Project, RB, MBIA Callable 11/15/03 @ 102 5.500%, 11/15/08 1,500 1,506 Plant City, Utility System, RB, MBIA 6.000%, 10/01/15 400 418 Polk County, Utility System, RB, ETM, FGIC 6.000%, 10/01/08 2,250 2,329 Reedy Creek, Improvement District, Ser 1991-1, RB, MBIA Prerefunded @ 101(F) 6.250%, 10/01/01 405 416 South Broward, Hospital District Authority, RB, AMBAC Callable 05/01/03 @ 102 7.500%, 05/01/08 1,000 1,078 Sunrise, Utility System Authority, RB, AMBAC Callable 10/01/18 @ 100 5.000%, 10/01/28 1,500 1,292 Tallahassee, Energy Systems Authority, Ser A, RB, FSA Callable 10/01/08 @ 101 5.000%, 10/01/28 5,040 4,286 27 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 FLORIDA TAX-EXEMPT BOND FUND--CONCLUDED - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- FLORIDA--CONTINUED Tampa, Allegany Health Systems Authority, St Mary's Hospital, RB, ETM, MBIA Callable 12/01/03 @ 102 5.000%, 12/01/12 $7,280 $ 6,960 Tampa, Guaranteed Entitlement, RB, AMBAC Callable 10/01/01 @ 102 7.050%, 10/01/07 1,000 1,045 Tampa, Special Utility, TA, AMBAC Callable 10/01/01 @ 102 6.900%, 10/01/09 1,500 1,564 Tampa, Sports Authority, Local Option Sales Tax, Stadium Project, RB, MBIA Callable 01/01/07 @ 101 5.250%, 01/01/27 3,000 2,688 -------- 84,037 -------- PUERTO RICO (9.7%) Commonwealth, Aqueduct & Sewer Authority, RB, MBIA 6.250%, 07/01/12 1,000 1,076 Commonwealth, Electric Power Authority, Ser S, RB 5.500%, 07/01/00 200 200 Commonwealth, Electric Power Authority, Ser X, RB Prerefunded @ 102 (F) 6.125%, 07/01/05 240 258 Commonwealth, Highway & Transportation Authority, Ser Z, RB, MBIA 6.250%, 07/01/14 3,000 3,228 Commonwealth, Municipal Financing Agency, Ser A, GO, FSA Callable 08/01/09 @ 101 5.500%, 08/01/23 2,340 2,231 Commonwealth, Public Buildings Authority, Government Facilities, Ser A, RB, AMBAC 6.250%, 07/01/13 1,000 1,077 6.250%, 07/01/14 750 807 Commonwealth, Public Improvements, GO, MBIA Callable 07/01/07 @ 100 5.375%, 07/01/25 1,500 1,390 -------- 10,267 -------- Total Municipal Bonds (Cost $96,770) 94,304 -------- - -------------------------------------------------------------------------------- SHARES VALUE (000) - -------------------------------------------------------------------------------- CASH EQUIVALENTS (8.6%) AIM Management Institutional Tax Free Fund 4,512,541 $ 4,513 SEI Institutional Tax Free Fund 4,576,465 4,576 -------- Total Cash Equivalents (Cost $9,089) 9,089 -------- Total Investments (97.8%) (Cost $105,859) 103,393 -------- OTHER ASSETS AND LIABILITIES, NET (2.2%) 2,313 -------- NET ASSETS: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 9,244,819 outstanding shares of beneficial interest 97,121 Fund shares of Investor Shares (unlimited authorization -- no par value) based on 285,455 outstanding shares of beneficial interest 2,838 Fund shares of Flex Shares (unlimited authorization -- no par value) based on 970,788 outstanding shares of beneficial interest 10,500 Distributions in excess of net investment income (5) Accumulated net realized loss on investments (2,282) Net unrealized depreciation on investments (2,466) -------- Total Net Assets (100.0%) $105,706 ======== Net Asset Value and Redemption Price Per Share -- Trust Shares $ 10.06 ======== Net Asset Value and Redemption Price Per Share -- Investor Shares $ 10.07 ======== Maximum Offering Price Per Share -- Investor Shares ($10.07 / 96.25%) $ 10.46 ======== Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) $ 10.09 ======== (1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE, SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 28 - -------------------------------------------------------------------------------- GEORGIA TAX-EXEMPT BOND FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MUNICIPAL BONDS (93.5%) GEORGIA (93.5%) Albany-Dougherty County, State Hospital Authority, Ser B, RB, AMBAC Prerefunded @ 102 (F) 7.500%, 09/01/00 $ 255 $ 262 Athens, Water & Sewer Authority, RB, ETM 5.700%, 07/01/00 165 165 Atlanta, Airport Facilities Authority, RB, AMBAC 6.000%, 01/01/03 1,000 1,021 6.000%, 01/01/04 500 514 6.500%, 01/01/06 1,000 1,058 Atlanta, Water & Sewer Authority, RB, ETM 6.000%, 01/01/11 1,000 1,044 Augusta, Water & Sewer Authority, RB Prerefunded @ 102 (F) 6.200%, 05/01/02 130 135 Bibb County, GO 7.000%, 01/01/04 985 1,043 Brunswick, Water & Sewer Authority, RB, MBIA 6.100%, 10/01/14 1,000 1,051 Carroll County, Water Authority, RB, AMBAC Callable 07/01/09 @ 102 5.000%, 07/01/10 720 693 Catoosa, Utility District Authority, RB, MBIA Callable 04/01/09 @ 102 5.000%, 04/01/12 710 670 Cherokee County, School System, GO 5.000%, 02/01/12 1,690 1,611 5.000%, 02/01/13 1,370 1,297 Clarke County, Hospital Authority, Athens Regional Medical Center Project, RB, MBIA 5.375%, 01/01/07 1,425 1,431 Clayton County, Water & Sewer Authority, RB, AMBAC Callable 05/01/06 @ 102 5.350%, 05/01/09 800 800 Cobb County, Water & Sewer Authority, RB Callable 07/01/04 @102 5.125%, 07/01/06 1,000 998 Cobb-Marietta County, Coliseum & Expo Project, RB, MBIA 5.500%, 10/01/12 940 939 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- GEORGIA--CONTINUED Cobb-Marietta County, Water Authority, RB 5.000%, 11/01/03 $ 1,255 $ 1,252 5.100%, 11/01/04 1,000 1,000 Columbia County, Courthouse/ Detention Center Projects, GO Callable 02/01/08 @ 102 5.000%, 02/01/10 720 690 Dalton, Utilities Authority, RB, MBIA 6.000%, 01/01/08 3,240 3,380 Dalton-Whitfield County, Hospital Authority, RB Prerefunded @ 102 (F) 7.000%, 07/01/00 355 363 DeKalb County, Development Authority, Emory University Project, Ser A, RB 5.375%, 11/01/05 1,650 1,669 DeKalb County, Development Authority, Emory University Project, Ser A, RB Callable 11/01/05 @ 101 5.200%, 11/01/08 500 498 DeKalb County, School District, Ser A, GO 6.250%, 07/01/11 1,500 1,609 Douglasville - Douglas County, Water & Sewer Authority, RB, AMBAC 5.625%, 06/01/15 1,370 1,381 Fayette County, School District, GO, ETM 6.250%, 03/01/07 450 474 Fayette County, Water Authority, Ser 1985-A, RB, ETM, MBIA Callable 10/01/00 @ 100 8.550%, 10/01/01 300 314 Forsyth County, Water & Sewer Authority, RB 5.000%, 04/01/04 1,000 996 Forsyth County, Water & Sewer Authority, RB, Callable 04/01/08 @ 101 5.000%, 04/01/09 1,000 971 Forsyth County, School District, GO Callable 02/01/10 @ 102 5.750%, 02/01/11 3,000 3,062 6.000%, 02/01/15 1,000 1,024 Forsyth County, School District, GO 6.400%, 07/01/05 750 790 6.500%, 07/01/06 1,000 1,064 29 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 GEORGIA TAX-EXEMPT BOND FUND--CONCLUDED - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- GEORGIA--CONTINUED Forsyth County, School District, GO, MBIA Prerefunded @ 102 (F) 5.350%, 07/01/05 $ 780 $ 800 Fulton County, Hospital Authority, Northside Hospital Project, Ser B, RB, MBIA Prerefunded @ 102 (F) 6.600%, 10/01/02 2,000 2,104 Fulton County, School District, GO 5.250%, 01/01/12 1,000 981 6.375%, 05/01/17 500 538 Fulton County, Water & Sewer Authority, RB, ETM, FGIC 6.375%, 01/01/14 1,000 1,075 Georgia State, Ser A, GO 6.250%, 04/01/11 1,000 1,074 Georgia State, Ser C, GO 6.500%, 04/01/08 1,000 1,077 6.250%, 08/01/08 1,360 1,447 6.250%, 08/01/13 650 699 6.250%, 08/01/13 1,000 1,075 Georgia State, Ser D, GO 6.700%, 08/01/10 2,250 2,484 Georgia State, Housing & Financial Authority, Single-Family Mortgage, Sub-Ser B-1, RB Callable 06/01/05 @ 102 5.550%, 12/01/07 550 550 Georgia State, Housing & Financial Authority, Single-Family Mortgage, Sub-Ser B-1, RB, FHA Callable 06/01/06 @ 102 5.550%, 12/01/10 325 324 5.600%, 12/01/11 450 448 Georgia State, Housing & Financial Authority, Single-Family Mortgage, Sub-Ser C-1, RB Callable 12/01/07 @ 101.50 5.550%, 12/01/16 500 481 Georgia State, Municipal Electric Authority, RB, ETM Callable 06/22/00 @ 100 8.000%, 01/01/15 1,900 2,320 Gwinnett County, Recreation Authority, RB 5.800%, 02/01/06 785 808 5.875%, 02/01/07 500 517 Gwinnett County, School District, Ser B, GO 6.400%, 02/01/06 500 529 6.400%, 02/01/07 1,500 1,594 Hall County, School District, Ser B, GO 6.300%, 12/01/05 675 710 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- GEORGIA--CONTINUED Henry County, Henry Medical Center Project, RB, AMBAC Prerefunded @ 102 (F) 5.500%, 07/01/07 $ 1,640 $ 1,683 Henry County, Henry Medical Center Project, RB, AMBAC Callable 07/01/07 @ 102 5.500%, 07/01/08 545 550 Henry County, School District, Ser A, GO 6.150%, 08/01/06 150 157 6.300%, 08/01/08 300 319 6.450%, 08/01/11 500 537 Henry County, School District, Ser A, GO, MBIA 5.500%, 08/01/01 350 353 Henry County, Water & Sewer Authority, RB, AMBAC 6.150%, 02/01/20 2,250 2,339 Houston County, School District, Intergovernmental Contract, COP, MBIA Prerefunded @ 102 (F) 6.000%, 03/01/04 2,000 2,094 Jackson County, School District, GO Callable 07/01/08 @ 101 5.000%, 07/01/10 1,020 982 Medical Center Hospital Authority, Columbus Regional Health Care System, RB, MBIA Prerefunded @ 102 (F) 6.000%, 08/01/05 1,340 1,410 Meriwether County, School District, GO, FSA 7.000%, 02/01/06 740 802 Metropolitan Atlanta, Rapid Transportation Authority, Ser A, RB, MBIA 6.250%, 07/01/07 500 528 Metropolitan Atlanta, Rapid Transportation Authority, Ser N, RB 6.000%, 07/01/07 1,000 1,035 Metropolitan Atlanta, Rapid Transportation Authority, Ser P, RB, AMBAC 6.250%, 07/01/08 1,000 1,060 Milledgeville, Water & Sewer Authority, RB, FSA 6.000%, 12/01/16 1,000 1,032 6.000%, 12/01/21 1,000 1,013 30 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- GEORGIA--CONTINUED Newton County, Hospital Authority, Newton Health Systems Project, RB, AMBAC Callable 02/01/10 @ 101 5.750%, 02/01/11 $ 780 $ 787 5.750%, 02/01/12 825 828 Paulding County, School District, GO, MBIA 6.000%, 02/01/10 1,000 1,043 Paulding County, School District, Ser A, GO 6.625%, 02/01/07 1,000 1,073 6.625%, 02/01/08 525 566 Private Colleges & Universities, Agnes Scott College Project, RB, MBIA Callable 06/01/09 @ 101 5.250%, 06/01/10 1,360 1,344 Private Colleges & Universities, Emory University Project, Ser A, RB, Callable 11/01/07 @ 101 5.000%, 11/01/10 1,000 962 Private Colleges & Universities, Mercer University Project, RB, ETM, MBIA 6.400%, 11/01/11 1,675 1,816 Private Colleges & Universities, Mercer University Project, Ser A, RB Callable 10/01/09 @ 101 5.250%, 10/01/13 1,000 915 Rome, Water & Sewer Authority, RB, AMBAC 5.250%, 01/01/09 775 769 Savannah, Water & Sewer Authority, RB, ETM Callable 12/01/00 6.450%, 12/01/04 1,000 1,054 Upper Oconee, Basin Water Authority, RB, FGIC Callable 07/01/08 @ 102 5.000%, 07/01/12 500 469 Vidalia, Water & Sewer Authority, RB, ETM Callable 07/01/00 @ 101 6.000%, 07/01/07 605 632 Walker, Dade & Catoosa Counties, Hutchinson Medical, Ser A, RB, FSA Callable 10/01/07 @ 102 5.500%, 10/01/08 1,370 1,374 -------- 86,430 -------- Total Municipal Bonds (Cost $89,672) 86,430 -------- - -------------------------------------------------------------------------------- SHARES VALUE (000) - -------------------------------------------------------------------------------- CASH EQUIVALENTS (5.1%) AIM Management Institutional Tax Free Portfolio 2,010,202 $ 2,010 SEI Institutional Tax Free Fund 2,682,922 2,683 -------- Total Cash Equivalents (Cost $4,693) 4,693 -------- Total Investments (98.6%) (Cost $94,365) 91,123 -------- OTHER ASSETS AND LIABILITIES, NET (1.4%) 1,322 -------- NET ASSETS: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 8,544,266 outstanding shares of beneficial interest 84,551 Fund shares of Investor Shares (unlimited authorization -- no par value) based on 258,359 outstanding shares of beneficial interest 2,529 Fund shares of Flex Shares (unlimited authorization -- no par value) based on 928,499 outstanding shares of beneficial interest 9,444 Distributions in excess of net investment income (1) Accumulated net realized loss on investments (836) Net unrealized depreciation on investments (3,242) -------- Total Net Assets (100.0%) $92,445 ======== Net Asset Value, Offering and Redemption Price Per Share -- Trust Shares $ 9.50 ======== Net Asset Value and Redemption Price Per Share -- Investor Shares $ 9.51 ======== Maximum Offering Price Per Share -- Investor Shares ($9.51 / 96.25%) $ 9.88 ======== Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) $ 9.51 ======== (1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE, SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 31 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 HIGH INCOME FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATION (47.2%) U.S. Treasury Bill 5.866%, 09/07/00 $1,475 $1,452 ------ Total U.S. Treasury Obligation (Cost $1,452) 1,452 ------ CORPORATE BONDS (49.4%) INDUSTRIAL (34.1%) Canandaigua Brands Callable 03/01/04 @ 104.25 8.500%, 03/01/09 100 91 Echostar DBS Callable 02/01/04 @ 104.689 9.375%, 02/01/09 100 94 Finlay Fine Jewelry Callable 05/01/03 @ 104.188 8.375%, 05/01/08 100 89 Hollywood Park, Ser B Callable 08/01/02 @ 104.75 9.500%, 08/01/07 100 99 Lyondell Chemical 9.625%, 05/01/07 100 97 NBTY, Ser B Callable 09/15/02 @ 104.313 8.625%, 09/15/07 100 87 Playtex Family Products Callable 08/16/00 @ 103 9.000%, 12/15/03 100 96 Polaroid 11.500%, 02/15/06 100 101 Primedia Callable 04/01/03 @ 103.813 7.625%, 04/01/08 100 89 R&B Falcon 9.500%, 12/15/08 100 98 Waste Management 6.625%, 07/15/02 115 108 ------ 1,049 ------ TELEPHONE (6.2%) Nextel Communications Callable 11/15/04 @ 104.688 9.375%, 11/15/09 100 94 Rural Cellular Callable 05/15/03 @ 104.813 9.625%, 05/15/08 100 97 ------ 191 ------ - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- TRANSPORTATION (NON-RAIL--9.1%) Continental Airlines 8.000%, 12/15/05 $100 $ 89 Greyhound Lines Callable 04/15/02 @ 105.75 11.500%, 04/15/07 290 191 ------ 280 ------ Total Corporate Bonds (Cost $1,682) 1,520 ------ REPURCHASE AGREEMENT (4.1%) JP Morgan 6.250%, dated 05/31/00, matures 06/01/00, repurchase price $124,620 (collateralized by a U.S. Treasury Note: total market value $127,124) (G) 125 $ 125 ------ Total Repurchase Agreement (Cost $125) 125 ------ Total Investments (100.7%) (Cost $3,259) 3,097 ------ OTHER ASSETS AND LIABILITIES, NET (-0.7%) (22) ------ NET ASSETS: Fund shares of Flex Shares (unlimited authorization -- no par value) based on 390,031 outstanding shares of beneficial interest 4,006 Accumulated net realized loss on investments (769) Net unrealized depreciation on investments (162) ------ Total Net Assets (100.0%) $3,075 ====== Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) $ 7.88 ====== (1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE, SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 32 - -------------------------------------------------------------------------------- INVESTMENT GRADE BOND FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS (26.3%) U.S. Treasury Bonds 7.500%, 11/15/16 $56,050 $ 61,986 8.750%, 08/15/20 77,250 97,405 U.S. Treasury Notes 6.500%, 08/31/01 88,000 87,708 6.500%, 02/15/10 26,350 26,728 -------- Total U.S. Treasury Obligations (Cost $269,854) 273,827 -------- U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS (10.2%) FHLMC 7.375%, 05/15/03 51,250 51,266 5.750%, 03/15/09 16,375 14,512 FNMA 7.125%, 01/15/30 41,900 40,719 -------- Total U.S. Agency Mortgage-Backed Obligations (Cost $107,560) 106,497 -------- CORPORATE OBLIGATIONS (48.4%) BANKS (4.1%) Wachovia 5.625%, 12/15/08 13,150 11,145 Washington Mutual 8.600%, 02/01/02 18,000 18,113 7.500%, 08/15/06 13,525 12,984 -------- 42,242 -------- FINANCE (19.7%) Aristar 7.250%, 06/15/06 26,800 25,594 Associates 6.250%, 11/01/08 24,500 21,621 Countrywide Home Loan 6.850%, 06/15/04 17,750 16,796 Countrywide Home Loan, MTN, Ser F 6.510%, 02/11/05 23,300 21,378 Donaldson Lufkin Jenrette, MTN 6.150%, 05/04/04 8,400 7,854 Finova Capital 7.250%, 11/08/04 13,400 11,189 7.250%, 07/12/06 21,500 17,227 Finova Capital, MTN, Ser E 7.300%, 09/22/03 28,850 24,919 Household Finance 7.200%, 07/15/06 21,000 19,845 Morgan Stanley Dean Witter MTN, Ser C 7.375%, 04/15/03 20,000 19,772 Paine Webber Group, MTN, Ser C 6.020%, 04/22/02 20,250 19,465 -------- 205,660 -------- - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- INDUSTRIAL (11.4%) Avon Products 7.150%, 11/15/09 $ 8,650 $ 8,055 Cooper Tire & Rubber 7.750%, 12/15/09 22,700 21,494 Dillards 6.430%, 08/01/04 24,550 21,082 Florida Power & Light 5.875%, 04/01/09 30,500 27,031 Marriot International, Ser C 7.875%, 09/15/09 24,600 23,585 Philip Morris 7.500%, 04/01/04 8,700 8,352 Times Mirror 7.450%, 10/15/09 9,500 9,144 -------- 118,743 -------- LIFE/HEALTH INSURANCE (13.2%) Aon 6.900%, 07/01/04 35,000 33,687 Conseco 8.750%, 02/09/04 41,600 28,496 6.800%, 06/15/05 22,700 14,982 6.400%, 06/15/11 8,800 6,600 Provident 7.000%, 07/15/18 30,600 23,753 Reliastar Financial 8.000%, 10/30/06 14,600 14,454 6.500%, 11/15/08 16,750 15,263 -------- 137,235 -------- Total Corporate Obligations (Cost $563,100) 503,880 -------- ASSET-BACKED OBLIGATION (3.6%) Commercial, Series 1999-1, Cl A2 6.455%, 06/15/08 41,750 37,998 -------- Total Asset-Backed Obligation (Cost $38,627) 37,998 -------- REPURCHASE AGREEMENTS (15.9%) Greenwich 6.330%, dated 05/31/00, matures 06/01/00, repurchase price $114,786,061 (collateralized by U.S. Treasury Note: total market value $117,062,258) (G) 114,766 114,766 33 STATEMENT OF NET ASSETS/SCHEDULE OF INVESTMENTS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 INVESTMENT GRADE BONDFUND--CONCLUDED - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- REPURCHASE AGREEMENTS--CONTINUED Warburg Dillion 6.330%, dated 05/31/00, matures 06/01/00, repurchase price $30,811,734 (collateralized by U.S. Treasury Notes: total market value $31,425,526) (G) $ 30,806 $ 30,806 Salomon Smith Barney 6.330%, dated 05/31/00, matures 06/01/00, repurchase price $20,005,261 (collateralized by U.S. Treasury STRIPS: total market value $20,427,914) (G) 20,002 20,002 ---------- Total Repurchase Agreements (Cost $165,574) 165,574 ---------- Total Investments (104.4%) (Cost $1,144,715) 1,087,776 ---------- SECURITIES PURCHASED PAYABLE (-5.9%) (61,806) ---------- OTHER ASSETS AND LIABILITIES, NET (1.5%) 15,235 ---------- NET ASSETS: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 104,192,073 outstanding shares of beneficial interest 1,093,168 Fund shares of Investor Shares (unlimited authorization -- no par value) based on 2,353,329 outstanding shares of beneficial interest 25,310 Fund shares of Flex Shares (unlimited authorization -- no par value) based on 2,091,237 outstanding shares of beneficial interest 22,416 Distributions in excess of net investment income (3) Accumulated net realized loss on investments (42,747) Net unrealized depreciation on investments (56,939) ---------- Total Net Assets (100.0%) $1,041,205 ========== - -------------------------------------------------------------------------------- VALUE (000) - -------------------------------------------------------------------------------- Net Asset Value and Redemption Price Per Share -- Trust Shares $ 9.58 ========== Net Asset Value and Redemption Price Per Share -- Investor Shares $ 9.58 ========== Maximum Offering Price Per Share -- Investor Shares ($9.58 / 96.25%) $ 9.95 ========== Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) $ 9.59 ========== (1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE,SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 34 - -------------------------------------------------------------------------------- INVESTMENT GRADE TAX-EXEMPT BOND FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MUNICIPAL BONDS (98.9%) ALABAMA (2.1%) Birmingham, Ser A, GO Callable 04/01/08 @ 102 5.000%, 04/01/19 $ 2,000 $ 1,753 Huntsville, Ser B, GO 4.000%, 11/01/01 1,410 1,389 ------- 3,142 ------- ARIZONA (9.5%) Arizona State, Highway Transportation Board, RB Callable 07/01/09 @ 100 6.125%, 07/01/14 6,020 6,240 Maricopa County, Community College Project, Ser C, GO 5.250%, 07/01/01 5,000 5,030 Maricopa County, Unified School District, GO, FGIC Callable 07/01/01 @ 101 6.400%, 07/01/10 3,050 3,123 ------- 14,393 ------- CALIFORNIA (1.4%) Orange County, Loma Ridge/Data Center Project, COP, AMBAC Callable 12/01/00 @ 101.5 6.000%, 06/01/21 2,075 2,147 ------- DISTRICT OF COLUMBIA (1.3%) District of Columbia, American College Obstetricians, RB, AMBAC Prerefunded @ 102 (F) 6.500%, 08/15/01 1,930 2,005 ------- FLORIDA (7.1%) Florida State, Department of Transportation, Right of Way, GO Prerefunded @101 (F) 5.800%, 07/01/05 1,400 1,454 Orange County, Health Facilities Authority, Ser A, RB, MBIA 6.250%, 10/01/12 1,170 1,241 Tampa, Occupational License Tax, Ser A, RB, FGIC (C) 3.850%, 10/01/18 4,500 4,500 Tampa, Sports Authority, Local Option Sales Tax-Stadium Project, RB, MBIA Callable 01/01/07 @ 101 5.250%, 01/01/27 4,000 3,584 ------- 10,779 ------- - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- GEORGIA (1.4%) Georgia, Municipal Electric Power Authority, Ser Y, RB, MBIA 6.500%, 01/01/17 $ 1,985 $ 2,147 ------- ILLINOIS (8.8%) Chicago, School Finance Authority, Ser A, GO, FGIC Callable 6/01/02 @102 6.250%, 06/01/09 6,000 6,217 Cook County, Ser A, GO, FGIC Callable 11/15/08 @ 101 5.000%, 11/15/15 2,000 1,798 Illinois State, Health Facilities Authority, Trinity Medical Center, RB, FSA Prerefunded @ 102 (F) 7.000%, 07/01/02 5,000 5,280 ------- 13,295 ------- IOWA (1.4%) Des Moines, Public Parking System, Ser A, RB, FGIC Callable 06/01/10 @ 100 6.375%, 06/01/18 2,005 2,076 ------- KENTUCKY (5.1%) Kentucky State, Economic Development Finance Authority, Health Alliance Project, Ser C, RB, MBIA (C) 3.950%, 01/01/22 7,800 7,800 ------- MARYLAND (2.4%) Washington, Suburban Sanitation District, 2nd Ser, GO Callable 01/01/02 @ 102 6.400%, 01/01/08 3,500 3,625 ------- MASSACHUSETTS (0.8%) Boston, Finance Housing Authority, City Hospital Project, Ser A, RB Callable 08/15/00 @ 102 7.650%, 02/15/10 1,260 1,293 ------- MICHIGAN (5.7%) Detroit, Sewer Disposal, Ser B, RB, MBIA (C) 3.950%, 07/01/23 5,500 5,500 Michigan State, Building Authority, Ser II, RB Callable 10/01/01 @ 102 6.750%, 10/01/11 2,950 3,067 ------- 8,567 ------- 35 SCHEDULE OF INVESTMENTS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 INVESTMENT GRADE TAX-EXEMPT BOND FUND--CONCLUDED - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MISSOURI (6.6%) Missouri State, Third Street Building Project, Ser A, GO Callable 08/01/03 @102 4.900%, 08/01/05 $ 8,500 $ 8,426 Missouri State, Health & Educational Facilities Authority, SSM Health Care Projects, Ser B, RB, ETM, MBIA Callable 06/26/00 @ 102 7.000%, 06/01/05 1,500 1,533 ------- 9,959 ------- NEW JERSEY (4.9%) New Jersey State, Transportation System, Ser A, RB 5.625%, 06/15/13 1,000 1,007 5.750%, 06/15/15 1,250 1,262 New Jersey State, Transportation System, Ser A, RB, FSA Callable 06/15/08 @ 100 5.000%, 06/15/18 1,000 892 New Jersey State, Turnpike Authority, Ser C, RB, FSA 6.500%, 01/01/16 1,000 1,085 New Jersey State, Turnpike Authority, Ser C, RB, MBIA 6.500%, 01/01/16 3,000 3,255 ------- 7,501 ------- NEW YORK (8.4%) Metropolitan Transportation Authority, Service Contract, Ser Q, RB, MBIA Callable 07/01/07 @ 101 5.250%, 07/01/14 3,345 3,182 New York State, Dormitory Authority, City University System, Ser A, RB, FSA 5.750%, 07/01/13 1,250 1,275 New York State, Dormitory Authority, City University System, 3rd Ser, RB, FGIC Callable 07/01/08 @101 5.000%, 07/01/18 1,750 1,557 New York State, Dormitory Authority, City University System, 2nd Ser, RB, FSA 5.750%, 07/01/18 3,175 3,178 Triborough Bridge & Tunnel Authority, Ser V, RB, FGIC Callable 01/01/01 @ 102 6.875%, 01/01/05 3,500 3,609 ------- 12,801 ------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- NORTH CAROLINA (0.7%) North Carolina State, Medical Care Community Hospital, Mercy Hospital Project, RB, ETM Callable 08/01/02 @ 102 6.500%, 08/01/15 $ 1,000 $ 1,047 ------- OHIO (1.1%) Cleveland, City School District, Ser A, GO, FGIC Callable 12/01/02 @ 102 5.875%, 12/01/11 1,650 1,678 ------- SOUTH DAKOTA (4.6%) South Dakota State, Health & Educational Facility Authority, St. Lukes Midland Regional Medical, RB, MBIA Callable 07/01/01 @ 102 6.625%, 07/01/11 6,675 6,906 ------- TENNESSEE (2.7%) Metropolitan Nashville, Airport Authority, Ser C, RB, FGIC Callable 07/01/01 @ 102 6.600%, 07/01/15 3,900 4,039 ------- TEXAS (19.4%) Dallas, GO Callable 02/15/08 @ 100 5.000%, 02/15/13 4,500 4,175 Ennis, Independent School District, GO Callable 08/15/10 @ 40.4318 (A) 0.000%, 08/15/24 3,265 682 Harris County, Toll Road, Sub Lien, RB, FGIC 6.000%, 08/01/14 10,000 10,193 Houston, Independent School District, Ser A, GO Callable 02/15/09 @ 100 5.000%, 02/15/24 4,000 3,403 Irving, Independent School District, GO Callable 02/15/07 @ 100 5.000%, 02/15/21 2,500 2,171 McAllen, Independent School District, GO Callable 10/01/09 @100 5.250%, 04/01/16 1,600 1,502 5.250%, 04/01/17 1,695 1,577 5.250%, 04/01/18 1,795 1,654 University of Texas, Ser B, RB Callable 08/15/01 @ 102 6.750%, 08/15/13 1,475 1,533 36 - -------------------------------------------------------------------------------- SHARES/FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- TEXAS--CONTINUED Waxahachie, Independent School District, GO Callable 08/15/10 @ 39.372 (A) 0.000%, 08/15/24 $ 6,385 $ 1,288 Waxahachie, Independent School District, GO Callable 08/15/10 @ 45.084 (A) 0.000%, 08/15/22 5,000 1,157 -------- 29,335 -------- VERMONT (1.4%) Burlington, Electric Authority, Ser A, RB, MBIA Callable 07/01/02 @102 6.250%, 07/01/14 2,000 2,061 -------- VIRGINIA (0.2%) Virginia State, Public Building Authority, RB Callable 08/01/10 @100 5.750%, 08/01/20 250 245 -------- WASHINGTON (1.9%) Clark County, Public Utility District, RB, AMBAC Callable 01/01/03 @ 102 5.100%, 01/01/08 3,000 2,929 -------- Total Municipal Bonds (Cost $150,636) 149,770 -------- CASH EQUIVALENTS (9.8%) AIM Management Institutional Tax Free Portfolio 7,381,127 7,381 SEI Institutional Tax Free Fund 7,461,934 7,462 -------- Total Cash Equivalents (Cost $14,843) 14,843 -------- Total Investments (108.7%) (Cost $165,479) 164,613 -------- THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 LIMITED-TERM FEDERAL MORTGAGE SECURITIES FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATION (15.5%) U.S. Treasury Note 6.500%, 08/31/01 $20,000 $ 19,934 -------- Total U.S. Treasury Obligation (Cost $19,920) 19,934 -------- U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS (67.5%) FHLMC 8.000%, 12/01/02 664 664 FHLMC REMIC, Ser 1614, Cl H 6.000%, 06/15/20 4,550 4,495 FHLMC REMIC, Ser 1624, Cl KC 6.000%, 06/15/08 11,084 10,576 FHLMC REMIC, Ser 1666, Cl E 6.000%, 12/15/19 5,000 4,909 FHLMC REMIC, Ser 29, Cl Q 7.500%, 06/25/20 15,000 14,952 FNMA 6.500%, 06/01/13 8,334 7,912 6.000%, 09/01/13 9,691 9,024 5.500%, 06/01/14 18,783 17,081 8.500%, 04/01/17 414 418 FNMA REMIC, Ser 206, Cl G 6.000%, 04/25/19 11,000 10,793 FNMA REMIC, Ser 223, Cl PH 6.050%, 10/25/22 5,375 5,125 GNMA 9.000%, 11/15/17 566 589 -------- Total U.S. Agency Mortgage-Backed Obligations (Cost $89,158) 86,538 -------- REPURCHASE AGREEMENT (17.0%) Morgan Stanley Dean Witter 6.450%, dated 05/31/00, matures 06/01/00, repurchase price $21,795 (collateralized by FNMA obligation: total market value $22,675) (G) 21,791 21,791 -------- Total Repurchase Agreement (Cost $21,791) 21,791 -------- Total Investments (100.0%) (Cost $130,869) 128,263 -------- OTHER ASSETS AND LIABILITIES, NET (0.0%) (8) -------- - -------------------------------------------------------------------------------- VALUE (000) - -------------------------------------------------------------------------------- NET ASSETS: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 13,035,532 outstanding shares of beneficial interest $131,248 Fund shares of Investor Shares (unlimited authorization -- no par value) based on 124,256 outstanding shares of beneficial interest 1,281 Fund shares of Flex Shares (unlimited authorization -- no par value) based on 177,386 outstanding shares of beneficial interest 1,817 Distributions in excess of net investment income (7) Accumulated net realized loss on investments (3,478) Net unrealized depreciation on investments (2,606) -------- Total Net Assets (100.0%) $128,255 ======== Net Asset Value, Offering and Redemption Price Per Share -- Trust Shares $ 9.62 ======== Net Asset Value and Redemption Price Per Share -- Investor Shares $ 9.60 ======== Maximum Offering Price Per Share -- Investor Shares ($9.60 / 97.50%) $ 9.85 ======== Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) $ 9.62 ======== (1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE, SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 38 - -------------------------------------------------------------------------------- MARYLAND MUNICIPAL BOND FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MUNICIPAL BONDS (94.9%) MARYLAND (81.2%) Anne Arundel County, GO Callable 02/01/08 @ 101 5.125%, 02/01/24 $ 750 $ 666 Baltimore County, Consolidated Public Improvement, GO Callable 06/01/06 @ 101 5.500%, 06/01/16 250 246 Baltimore County, Consolidated Public Improvement, GO Callable 07/01/08 @101 4.750%, 07/01/09 500 475 Baltimore, Emergency Telecommunication Facilities, Ser A, COP, AMBAC Callable 10/01/07 @ 102 5.000%, 10/01/17 400 364 Baltimore, Pollution Control Authority, General Motors Project, RB 5.350%, 04/01/08 250 251 Calvert County, Economic Development Authority, Asbury-Solomons Project, RB, MBIA Callable 01/01/08 @ 102 5.000%, 01/01/17 250 226 Calvert County, Pollution Control Authority, Baltimore Gas & Electric Project, RB Callable 07/15/04 @ 102 5.550%, 07/15/14 250 246 Carroll County, Consolidated Public Improvement, GO Callable 12/01/06 @ 101 5.125%, 12/01/14 500 475 Maryland State, Aviation Administration Facilities, COP, AMT Callable 05/01/09 @101 4.750%, 05/01/13 1,500 1,341 Maryland State, GO (C) 4.380%, 08/01/12 700 700 Maryland State, Community Development Administration, Ser B, RB, AMT, FHA Callable 03/01/07 @ 101.50 5.875%, 09/01/25 500 475 Maryland State, Community Development Administration, Ser D, RB, AMT Callable 03/01/09 @ 101 5.250%, 09/01/19 1,000 893 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MARYLAND--CONTINUED Maryland State, Community Development Administration, Ser E, RB, FHA Callable 09/01/09 @ 100 5.700%, 09/01/17 $1,000 $ 960 Maryland State, Community Development Administration, Ser F, RB, AMT Callable 09/01/09 @ 100 5.900%, 09/01/19 1,000 951 Maryland State, Community Development Administration, Single-Family Housing, 1st Ser, RB Callable 04/01/07 @ 101.50 5.600%, 04/01/18 375 355 Maryland State, Community Development Administration, Single-Family Program, 2nd Ser, RB Callable 04/01/09 @ 101 5.000%, 04/01/17 1,000 884 Maryland State, Economic Development Authority, Chesapeake Bay Foundation, RB (C) (E) 4.350%, 11/01/23 500 500 Maryland State, Health & Higher Educational Facilities Authority, Anne Arundel Medical Center Project, RB, FSA Callable 7/01/08 @ 101 5.125%, 07/01/28 1,250 1,089 Maryland State, Health & Higher Educational Facilities Authority, Broadmead Project, RB Callable 07/01/07 @ 102 5.500%, 07/01/17 300 265 Maryland State, Health & Higher Educational Facilities Authority, Calvert Memorial Hospital Project, RB Callable 07/01/08 @ 102 5.000%, 07/01/13 400 349 Maryland State, Health & Higher Educational Facilities Authority, Catholic Health Initiatives, Ser A, RB Callable 06/01/10 @ 101 6.000%, 12/01/24 250 243 Maryland State, Health & Higher Educational Facilities Authority, Greater Baltimore Medical Center, RB 4.350%, 07/01/25 1,000 1,000 39 - -------------------------------------------------------------------------------- STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 MARYLAND MUNICIPAL BOND FUND--CONCLUDED - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MARYLAND--CONTINUED Maryland State, Health & Higher Educational Facilities Authority, Johns Hopkins Health System Project, RB, AMBAC Callable 07/01/07 @ 102 5.250%, 07/01/17 $ 350 $ 326 Maryland State, Health & Higher Educational Facilities Authority, Loyola College Project, RB Callable 10/01/09 @ 101 5.250%, 10/01/29 1,250 1,101 Maryland State, Health & Higher Educational Facilities Authority, Loyola College Project, Ser A, RB, MBIA Callable 10/01/06 @ 102 5.500%, 10/01/16 250 242 Maryland State, Health & Higher Educational Facilities Authority, Pickersgill Project, Ser A, RB Callable 01/01/07 @ 102 6.000%, 01/01/15 350 333 Maryland State, Health & Higher Educational Facilities Authority, University of Maryland Medical Systems Project, Ser A, RB, FGIC Prerefunded @ 100 (F) 6.500%, 07/01/01 200 204 Maryland State, Health & Higher Educational Facilities Authority, Upper Chesapeake Hospital Project, Ser A, RB, FSA Callable 01/01/08 @ 101 5.125%, 01/01/33 1,250 1,078 Maryland State, Industrial Development Financing Authority, Holy Cross Health System, RB Callable 12/01/03 @ 102 5.500%, 12/01/15 100 96 Maryland State, State & Local Facilities Loan, First Ser, GO Callable 02/15/06 @ 101.50 4.700%, 02/15/10 300 281 Maryland State, State & Local Facilities Loan, Third Ser, GO 5.500%, 10/15/04 500 510 Maryland State, Stadium Authority, Sports Facility Project, RB, AMBAC Callable 03/01/06 @ 101 5.800%, 03/01/26 250 243 Maryland State, Transportation Authority, RB, ETM 6.800%, 07/01/16 120 132 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MARYLAND--CONTINUED Montgomery County, Economic Development Authority, Genomic Research Facility, RB (C) (E) Callable 06/02/00 @ 100 4.400%, 03/01/09 $ 700 $ 700 Montgomery County, Housing Opportunity, Kensington Park Project, RB, MBIA 3.950%, 07/01/28 1,600 1,600 Montgomery County, Housing Opportunity, The Grande Project Issue I, RB, AMT (C) 3.950%, 06/01/30 1,300 1,300 Montgomery County, Human Services Headquarters Project, RB 5.400%, 08/01/06 200 203 Montgomery County, Pollution Control Authority, Potomac Electric Power Project, RB, MBIA Callable 02/15/04 @ 102 5.375%, 02/15/24 1,700 1,556 Montgomery County, Pollution Control Authority, Potomac Electric Power Project, RB Callable 02/15/04 @ 102 5.375%, 02/15/24 100 90 Montgomery County, Consolidated Public Improvement, Ser A, GO 5.800%, 07/01/07 500 519 Northeast Maryland, Waste Disposal Authority, Montgomery County Resource Project, RB Callable 07/01/03 @ 102 6.200%, 07/01/10 275 278 Prince Georges County, Consolidated Public Improvements, Ser A, GO, MBIA Callable 03/01/02 @ 102 5.625%, 09/01/04 250 255 Queen Annes County, Public Facilities, GO, FGIC 5.125%, 11/15/06 350 350 Saint Mary's County, Public Facilities, GO, AMBAC Callable 11/01/03 @ 102 5.500%, 11/01/07 150 152 Saint Mary's County, Consolidated Public Improvements, GO, MBIA 4.500%, 09/01/00 500 500 University of Maryland, Ser A, RB Callable 04/01/08 @ 100 5.000%, 04/01/19 500 446 40 - -------------------------------------------------------------------------------- SHARES/FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MARYLAND--CONTINUED University of Maryland, Ser A, RB 5.000%, 04/01/05 $ 400 $ 398 University of Maryland, Ser A, RB Callable 04/01/06 @ 101 5.500%, 04/01/08 100 101 Washington County, Consolidated Public Improvement, GO, FGIC Callable 01/01/03 @ 102 5.250%, 01/01/07 100 100 Washington County, Suburban Sanitation District, GO Callable 06/01/06 @ 100 5.600%, 06/01/19 250 243 ------- 26,291 ------- Puerto Rico (13.7%) Puerto Rico Commonwealth, Highway & Transportation Authority, Ser Y, RB Callable 07/01/06 @ 101.50 5.500%, 07/01/26 1,700 1,576 Puerto Rico Commonwealth, Housing, Bank & Finance Agency, Affordable Housing Mortgage Porfolio, Ser I, RB, AMT, GNMA Callable 04/01/05 @ 102 6.250%, 04/01/29 660 650 Puerto Rico Commonwealth, Medical & Environmental Control Facilities, San Lucas & Cristo Project, Ser A, RB Callable 06/01/09 @ 101 5.750%, 06/01/29 740 604 Puerto Rico Commonwealth, Public Finance, Ser PA 502, RB (C) 3.900%, 06/01/19 1,600 1,600 ------- 4,430 ------- Total Municipal Bonds (Cost $32,457) 30,721 ------- Cash Equivalents (5.0%) AIM Tax Free Institutional Cash Reserve 808,589 809 Federated Maryland Municipal Cash Trust 808,236 808 ------- Total Cash Equivalents (Cost $1,617) 1,617 ------- Total Investments (99.9%) (Cost $34,074) 32,338 ------- Other Assets and Liabilities, Net (0.1%) 50 ------- - -------------------------------------------------------------------------------- VALUE (000) - -------------------------------------------------------------------------------- NET ASSETS: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 2,767,603 outstanding shares of beneficial interest $27,677 Fund shares of Flex Shares (unlimited authorization -- no par value) based on 655,599 outstanding shares of beneficial interest 6,738 Distributions in excess of net investment income (35) Accumulated net realized loss on investments (256) Net unrealized depreciation on investments (1,736) ------- Total Net Assets (100.0%) $32,388 ======= Net Asset Value and Redemption Price Per Share-- Trust Shares $ 9.46 ======= Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) $ 9.48 ======= (1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE, SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 41 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 SHORT-TERM BOND FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS (18.9%) U.S. Treasury Notes 5.000%, 04/30/01 $11,000 $ 10,833 5.250%, 05/31/01 1,500 1,478 6.500%, 08/31/01 7,000 6,977 5.625%, 09/30/01 1,000 985 6.375%, 09/30/01 6,000 5,969 6.250%, 10/31/01 1,750 1,738 7.500%, 11/15/01 2,500 2,524 6.250%, 06/30/02 1,250 1,237 6.000%, 07/31/02 2,000 1,970 U.S. Treasury STRIPS 0.000%, 08/15/03 1,250 1,013 -------- Total U.S. Treasury Obligations (Cost $35,373) 34,724 -------- U.S. GOVERNMENT AGENCY OBLIGATION (0.5%) FFCB 7.125%, 06/01/01 1,000 999 -------- Total U.S. Government Agency Obligation (Cost $1,001) 999 -------- U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS (7.4%) FHLMC 6.500%, 12/01/00 660 655 6.000%, 07/01/06 8,422 7,900 FNMA 7.000%, 01/01/27 1,531 1,453 FNMA REMIC, Ser 1996-30, Cl PC 7.000%, 11/25/20 2,600 2,559 GNMA 8.000%, 11/15/09 1,071 1,081 -------- Total U.S. Agency Mortgage-Backed Obligations (Cost $14,155) 13,648 -------- CORPORATE OBLIGATIONS (63.4%) BANKS (2.4%) Banc One 6.400%, 08/01/02 3,000 2,921 Key Bank 5.800%, 04/01/04 1,675 1,562 -------- 4,483 -------- FINANCE (26.0%) American General 6.250%, 03/15/03 1,100 1,057 American General Finance 5.900%, 01/15/03 2,000 1,908 Associates, Ser H, MTN 7.080%, 04/15/03 1,500 1,470 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- FINANCE--CONTINUED CIT Group Holdings, MTN 6.500%, 06/14/02 $ 3,000 $ 2,918 Commercial Credit 6.375%, 09/15/02 2,500 2,434 Diageo Capital PLC 6.625%, 06/24/04 2,500 2,406 Daimler Chrysler NA Holdings, Ser B, MTN 6.460%, 12/01/01 2,500 2,454 Ford Capital 10.125%, 11/15/00 2,000 2,024 Ford Motor Credit 6.000%, 01/14/03 3,500 3,356 General Electric Capital, Ser A, MTN 6.330%, 09/17/01 3,000 2,963 General Motors Acceptance 5.950%, 03/14/03 1,000 955 Household Finance 8.000%, 05/09/05 2,500 2,475 Household Finance, MTN 7.080%, 06/03/02 2,500 2,459 International Lease Finance, Ser J, MTN 5.500%, 09/29/03 2,000 1,873 Merrill Lynch, Ser B, MTN 5.640%, 01/27/03 3,750 3,563 Morgan Stanley Dean Witter, Ser C, MTN 5.625%, 04/12/02 1,750 1,689 PNC Funding 6.950%, 09/01/02 3,000 2,955 Salomon Smith Barney Holdings 6.750%, 02/15/03 3,000 2,921 Transamerica Finance, Ser F, MTN 6.800%, 12/14/01 3,000 2,954 US West Capital Funding 6.875%, 08/15/01 3,000 2,973 -------- 47,807 -------- INDUSTRIAL (21.7%) American Home Products 7.900%, 02/15/05 2,000 2,015 Clark Equipment 9.750%, 03/01/01 1,750 1,774 Computer Associates International, Ser B 6.375%, 04/15/05 2,300 2,105 Conoco 5.900%, 04/15/04 1,150 1,084 Cox Communications 7.000%, 08/15/01 3,000 2,966 Daimler Chrysler NA Holdings 7.400%, 01/20/05 2,000 1,965 42 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- Industrial--continued Dayton Hudson (C) 5.950%, 06/15/00 $ 500 $ 499 Eastman Kodak, Ser A, MTN 6.500%, 08/15/01 4,000 3,945 General Foods Callable 08/16/00 @ 100 6.000%, 06/15/01 500 488 Hasbro 7.950%, 03/15/03 3,000 2,982 Nabisco 6.800%, 09/01/01 1,500 1,457 Norfolk Southern 7.875%, 02/15/04 1,500 1,494 Philip Morris 7.500%, 01/15/02 500 493 Procter & Gamble 5.250%, 09/15/03 3,000 2,828 Raytheon 6.450%, 08/15/02 2,900 2,828 Safeway Stores 7.000%, 09/15/02 3,000 2,944 TCI Communications 6.375%, 05/01/03 2,250 2,168 TRW 6.500%, 06/01/02 3,000 2,910 TRW, Ser A, MTN 9.000%, 02/09/01 1,000 1,005 Tyco International Group SA(C) 6.250%, 06/15/03 2,000 1,885 -------- 39,835 -------- UTILITIES (13.3%) Alabama Power 7.850%, 05/15/03 3,250 3,245 Baltimore Gas and Electric 6.125%, 07/01/03 1,750 1,682 Northern States Power 6.125%, 12/01/05 5,000 4,644 Pacific Gas and Electric, Ser 93-E 5.875%, 10/01/05 3,500 3,203 Philadelphia Electric 7.125%, 09/01/02 2,000 1,975 Scottish Power PLC, Ser H, MTN 6.750%, 07/15/04 2,500 2,393 Southern New England Telephone, Ser C, MTN 6.125%, 12/15/03 3,000 2,861 Sprint Capital 5.700%, 11/15/03 2,000 1,875 Vodaphone Airtouch PLC (B) 6.698%, 12/19/01 2,500 2,497 -------- 24,375 -------- Total Corporate Obligations (Cost $119,792) 116,500 -------- - -------------------------------------------------------------------------------- SHARES/FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- REGIONAL GOVERNMENT AGENCY (1.4%) Province of Quebec 8.800%, 04/15/03 $ 2,500 $ 2,584 -------- Total Regional Government Agency (Cost $2,655) 2,584 -------- ASSET-BACKED OBLIGATIONS (6.6%) CoreStates Home Equity Trust, Ser 1994-1, Cl A 6.650%, 05/15/09 455 449 Discover Card Master Trust I, Ser 1998-4, Cl A 5.750%, 10/16/03 1,990 1,960 Discover Card Master Trust I, Ser 1999-2, Cl A 5.900%, 10/15/04 3,000 2,918 EQCC Home Equity Loan Trust, Ser 1994-1, Cl A 5.800%, 03/15/09 386 373 Equivantage Home Equity Loan Trust, Ser 1996-1, Cl A 6.550%, 10/25/25 452 440 Metris Master Trust, Ser 1997-1, Cl A 6.870%, 10/20/05 2,000 1,980 Premier Auto Trust, Ser 1998-5, Cl A-4 5.190%, 04/08/03 3,500 3,373 Spiegel Master Trust, Ser 1995-A, Cl A 7.500%, 09/15/04 333 334 Union Acceptance, Ser 2000-A, Cl A1 5.993%, 02/08/01 337 337 -------- Total Asset-Backed Obligations (Cost $12,412) 12,164 -------- CASH EQUIVALENTS (0.6%) AIM Liquid Assets Portfolio 968,315 968 SEI Daily Income Trust Prime Obligation Fund 54,190 54 -------- Total Cash Equivalents (Cost $1,022) 1,022 -------- Total Investments (98.8%) (Cost $186,410) 181,641 -------- OTHER ASSETS AND LIABILITIES, NET (1.2%) 2,272 -------- 43 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 SHORT-TERM BOND FUND--CONCLUDED - -------------------------------------------------------------------------------- VALUE (000) - -------------------------------------------------------------------------------- NET ASSETS: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 18,701,923 outstanding shares of beneficial interest $189,921 Fund shares of Investor Shares (unlimited authorization -- no par value) based on 149,580 outstanding shares of beneficial interest 1,506 Fund shares of Flex Shares (unlimited authorization -- no par value) based on 213,649 outstanding shares of beneficial interest 2,159 Distributions in excess of net investment income (4) Accumulated net realized loss on investments (4,900) Net unrealized depreciation on investments (4,769) -------- Total Net Assets (100.0%) $183,913 ======== Net Asset Value and Redemption Price Per Share -- Trust Shares $ 9.65 ======== Net Asset Value and Redemption Price Per Share -- Investor Shares $ 9.67 ======== Maximum Offering Price Per Share -- Investor Shares ($9.67 / 98.00%) $ 9.87 ======== Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) $ 9.67 ======== (1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE, SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 44 SHORT-TERM U.S. TREASURY SECURITIES FUND - -------------------------------------------------------------------------------- SHARES/FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS (97.0%) U. S. Treasury Bills 6.081%, 08/17/00 $ 5,000 $ 4,942 5.605%, 10/12/00 6,000 5,872 U.S. Treasury Notes 5.750%, 10/31/00 2,000 1,995 5.375%, 02/15/01 12,800 12,681 4.875%, 03/31/01 4,000 3,940 6.375%, 03/31/01 11,500 11,464 6.250%, 10/31/01 3,000 2,979 7.500%, 11/15/01 7,500 7,573 6.250%, 01/31/02 4,500 4,463 6.625%, 03/31/02 10,500 10,471 6.250%, 06/30/02 2,000 1,980 5.875%, 09/30/02 4,500 4,417 5.500%, 03/31/03 5,000 4,845 ------- Total U.S. Treasury Obligations (Cost $78,450) 77,622 ------- CASH EQUIVALENT (2.4%) SEI Daily Income Trust Treasury II Fund 1,903,850 1,904 ------- Total Cash Equivalent (Cost $1,904) 1,904 ------- Total Investments (99.4%) (Cost $80,354) 79,526 ------- Other Assets and Liabilities, Net (0.6%) 501 ------- Net Assets: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 7,368,421 outstanding shares of beneficial interest 73,271 Fund shares of Investor Shares (unlimited authorization -- no par value) based on 209,753 outstanding shares of beneficial interest 2,137 Fund shares of Flex Shares (unlimited authorization -- no par value) based on 548,512 outstanding shares of beneficial interest 5,484 Distributions in excess of net investment income (21) Accumulated net realized loss on investments (16) Net unrealized depreciation on investments (828) ------- Total Net Assets (100.0%) $80,027 ======= - -------------------------------------------------------------------------------- VALUE - -------------------------------------------------------------------------------- Net Asset Value, Offering and Redemption Price Per Share -- Trust Shares $ 9.85 ======= Net Asset Value and Redemption Price Per Share-- Investor Shares $ 9.85 ======= Maximum Offering Price Per Share -- Investor Shares ($9.85 / 99.00%) $ 9.95 ======= Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) $ 9.83 ======= (1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE, SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 45 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 U.S. GOVERNMENT SECURITIES FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS (12.8%) U.S. Treasury Bonds 7.250%, 05/15/16 $ 1,000 $ 1,080 7.625%, 02/15/25 400 463 6.125%, 11/15/27 2,220 2,171 5.250%, 11/15/28 2,350 2,038 U.S. Treasury Notes 6.250%, 04/30/01 510 508 8.000%, 05/15/01 90 91 6.625%, 06/30/01 580 579 7.500%, 05/15/02 750 760 6.250%, 06/30/02 550 544 7.250%, 05/15/04 500 510 7.875%, 11/15/04 275 288 7.500%, 02/15/05 500 517 6.500%, 10/15/06 2,000 1,991 6.625%, 05/15/07 550 552 ------- Total U.S. Treasury Obligations (Cost $12,531) 12,092 ------- U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS (86.2%) FHLMC 6.000%, 02/01/01 42 40 7.000%, 01/01/09 65 63 7.000%, 04/01/09 198 191 7.000%, 08/01/10 390 377 7.000%, 01/01/11 227 220 7.000%, 02/01/12 799 774 6.500%, 03/01/12 2,391 2,273 7.000%, 05/01/12 472 457 6.500%, 12/01/12 1,152 1,095 7.000%, 06/01/17 4,699 4,465 FHLMC REMIC, Ser 2039, Cl PC 6.000%, 05/15/09 1,000 945 FNMA 6.000%, 11/01/07 600 565 7.500%, 06/01/11 288 283 7.000%, 09/01/11 509 493 7.000%, 05/01/12 518 501 7.000%, 06/01/12 408 395 7.000%, 07/01/12 484 468 6.500%, 06/01/13 1,414 1,344 6.500%, 09/01/13 165 157 7.000%, 11/01/14 4,890 4,732 7.000%, 10/25/16 482 457 6.500%, 07/01/18 875 814 6.290%, 08/01/18 1,441 1,340 6.500%, 08/01/18 855 791 6.000%, 12/01/18 1,844 1,655 7.000%, 01/01/27 766 726 7.500%, 04/01/27 418 406 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- FNMA--CONTINUED 6.000%, 03/01/28 $ 822 $ 737 6.500%, 03/02/28 780 721 6.500%, 03/01/29 3,738 3,458 6.250%, 05/15/29 10,000 8,687 FNMA REMIC, Ser 143, Cl J 8.750%, 12/25/20 45 46 FNMA REMIC, Ser 156, Cl B 6.500%, 04/25/18 100 98 FNMA REMIC, Ser 30, Cl PC 7.000%, 11/25/20 2,000 1,969 FNMA REMIC, Ser 34, Cl VC 7.500%, 05/01/12 1,000 979 FNMA REMIC, Ser 40, Cl VC 6.500%, 08/25/10 261 241 FNMA REMIC, Ser 6, Cl H 7.000%, 08/18/08 1,058 1,010 FNMA REMIC, Ser 63, Cl PC 6.500%, 03/18/26 1,140 1,082 FNMA REMIC, Ser 68, Cl C 6.500%, 08/18/18 1,000 969 FNMA REMIC, Ser 9, Cl H 6.500%, 11/25/13 1,337 1,232 GNMA 7.500%, 10/20/09 32 32 8.000%, 11/15/09 693 699 8.250%, 01/15/12 55 55 6.000%, 07/15/13 875 817 6.000%, 01/15/14 1,708 1,595 9.000%, 04/15/17 163 168 8.500%, 05/15/17 561 571 10.000%, 06/15/19 2 2 7.500%, 05/15/22 194 190 7.000%, 11/15/22 310 297 8.000%, 02/15/23 14 14 8.500%, 03/15/23 30 31 7.500%, 04/15/23 84 83 7.500%, 09/15/23 605 594 6.500%, 10/15/23 739 691 6.500%, 11/15/23 994 930 7.000%, 01/15/24 92 89 7.500%, 04/15/24 492 483 7.000%, 06/15/24 571 548 8.000%, 08/15/24 36 36 8.000%, 09/15/24 11 11 8.000%, 10/15/24 18 18 8.000%, 11/15/24 14 14 8.500%, 12/15/24 32 33 8.500%, 02/15/25 5 5 7.000%, 12/15/25 308 296 7.500%, 01/15/26 332 326 46 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SHARES/FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- GNMA--CONTINUED 7.500%, 09/15/26 $ 496 $ 487 7.000%, 03/15/27 211 203 7.000%, 04/15/27 703 674 7.500%, 07/15/27 296 291 7.000%, 09/15/27 62 60 7.000%, 10/15/27 694 667 7.500%, 10/15/27 36 35 7.000%, 11/15/27 964 925 7.000%, 12/15/27 833 799 7.000%, 01/15/28 1,121 1,075 7.500%, 01/15/28 282 277 6.500%, 02/15/28 868 812 6.500%, 03/15/28 107 100 6.500%, 04/15/28 78 73 6.500%, 05/20/28 1,747 1,626 6.500%, 06/15/28 38 35 6.500%, 09/15/28 2,794 2,614 6.250%, 10/15/28 1,866 1,720 6.500%, 02/15/29 658 616 7.500%, 10/15/29 10,801 10,606 GNMA REMIC, Ser 6, Cl E 7.500%, 05/20/23 1,000 985 GNMA REMIC, Ser 9, Cl D 6.500%, 08/20/24 1,000 897 ------- Total U.S. Agency Mortgage-Backed Obligations (Cost $84,961) 81,461 ------- ASSET-BACKED OBLIGATION (0.0%) EQCC Home Equity Loan Trust, Ser 1, Cl A 5.800%, 03/15/09 40 38 ------- Total Asset-Backed Obligation (Cost $40) 38 ------- CASH EQUIVALENT (1.0%) AIM Liquid Assets Portfolio 970,967 971 ------- Total Cash Equivalent (Cost $971) 971 ------- Total Investments (100.0%) (Cost $98,503) 94,562 ------- OTHER ASSETS AND LIABILITIES, NET (0.0%) 15 ------- - -------------------------------------------------------------------------------- VALUE (000) - -------------------------------------------------------------------------------- NET ASSETS: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 8,659,920 outstanding shares of beneficial interest $91,170 Fund shares of Investor Shares (unlimited authorization -- no par value) based on 142,703 outstanding shares of beneficial interest 1,456 Fund shares of Flex Shares (unlimited authorization -- no par value) based on 785,689 outstanding shares of beneficial interest 8,432 Undistributed net investment income 4 Accumulated net realized loss on investments (2,544) Net unrealized depreciation on investments (3,941) ------- Total Net Assets (100.0%) $94,577 ======= Net Asset Value and Redemption Price Per Share -- Trust Shares $ 9.86 ======= Net Asset Value and Redemption Price Per Share -- Investor Shares $ 9.86 ======= Maximum Offering Price Per Share -- Investor Shares ($9.86 / 96.25%) $ 10.24 ======= Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) $ 9.86 ======= (1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE, SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 47 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MUNICIPAL BONDS (96.2%) VIRGINIA (96.2%) Alexandria, Consolidated Public Improvement, GO 4.500%, 01/01/15 $ 2,000 $ 1,729 Alexandria, Redevelopment & Housing Authority, Residential Care Facilities, Goodwin House Project, Ser B, RB Callable 06/02/00 @ 100 4.450%, 10/01/06 2,650 2,650 Arlington County, GO 5.400%, 08/01/01 1,000 1,008 Arlington County, Industrial Development Authority, Alexandria/Arlington Project, Ser A, RB, FSA 5.250%, 01/01/05 4,000 4,011 Arlington County, Industrial Development Authority, Alexandria/Arlington Waste Project, Ser B, RB, AMT, FSA Callable 07/01/08 @ 101 5.375%, 01/01/11 3,000 2,909 Arlington County, GO Callable 10/01/08 @ 101 5.000%, 10/01/11 3,220 3,104 Chesapeake Bay, Bridge & Tunnel Authority, General Resolution, RB, MBIA Prerefunded @ 102 (F) 6.375%, 07/01/01 7,000 7,257 Chesapeake, GO 5.400%, 12/01/08 2,500 2,522 Chesapeake, Hospital Authority, General Hospital Project, RB, Callable 07/01/00 @ 102 8.200%, 07/01/05 1,000 1,022 Chesterfield County, Public Improvements, Ser A, GO Callable 01/01/08 @ 100 4.700%, 01/01/12 3,215 2,946 Danville, Industrial Development Authority, Danville Regional Medical Center Project, RB, AMBAC 5.250%, 10/01/28 4,250 3,788 Dinwiddie County, Industrial Development Authority, Ser A, RB Callable 07/03/00 @ 100 4.750%, 07/15/01 3,150 3,127 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Fairfax County, Industrial Development Authority, Health Care Inova Health System Project, RB Callable 08/15/06 @ 102 5.300%, 08/15/07 $ 1,500 $ 1,475 Fairfax County, Industrial Development Authority, Health Care Inova Health System Project, Ser A, RB Callable 02/15/08 @ 101 5.000%, 08/15/10 2,890 2,672 Fairfax County, Public Improvement, Ser A, GO Callable 06/01/07 @ 102 4.500%, 06/01/10 3,000 2,731 Fairfax County, Ser B, GO Prerefunded @ 102 (F) 5.200%, 06/01/01 5,000 5,121 Fairfax County, Sewer Authority, RB, AMBAC Callable 11/15/03 @ 102 5.500%, 11/15/09 3,000 3,020 Fairfax County, Water Authority, RB Callable 04/01/07 @ 102 6.000%, 04/01/22 5,000 5,016 Fredericksburg, Industrial Development Authority, Medicorp Health System, RB, AMBAC Callable 06/15/07 @ 102 5.250%, 06/15/16 5,000 4,583 Hanover County, Industrial Development Authority, Covenant Woods Project, RB Callable 07/03/00 @ 100 (C) (D) (E) 4.450%, 07/01/29 3,000 3,000 Harrisonburg, Industrial Development Authority, Rockingham Memorial Hospital Project, RB, MBIA Callable 12/01/02 @ 102 5.750%, 12/01/13 3,000 2,994 Henrico County, Industrial Development Authority, Educational Facilities, Collegiate Schools, RB Callable 10/15/08 @ 102 5.000%, 10/15/19 2,250 1,950 Henrico County, Industrial Development Authority, Bon Secours Health System Project, RB, FSA 4.950%, 08/15/03 1,000 992 48 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Henrico County, Industrial Development Authority, Governmental Projects, RB Callable 06/01/06 @ 102 5.150%, 06/01/07 $ 2,500 $ 2,485 Henrico County, Industrial Development Authority, Solid Waste Facility, Browning Ferris Project, RB, AMT 5.300%, 12/01/11 1,000 904 Henrico County, Industrial Development Authority, Westminster-Canterbury Project, RB Callable 10/1/09 @ 101 5.700%, 10/01/23 1,610 1,428 Henrico County, Water & Sewer Authority, RB Callable 05/01/09 @ 102 4.625%, 05/01/17 1,900 1,601 Henry County, GO Callable 07/15/04 @ 102 6.000%, 07/15/14 1,000 1,012 Loudoun County, Sanitation Authority, Water & Sewer, RB, FGIC Callable 01/01/03 @ 102 6.100%, 01/01/04 1,250 1,290 Louisa, Industrial Development Authority, Virginia Electric & Power Project, Ser A, RB, AMT 5.150%, 04/01/02 2,500 2,480 Lynchburg, GO Callable 04/01/03 @ 102 5.250%, 04/01/08 2,000 1,995 Lynchburg, Industrial Development Authority, Centra Health Project, RB Callable 01/01/08 @ 101 5.200%, 01/01/23 500 419 Martinsville, GO Callable 06/19/00 @ 100 3.600%, 01/15/01 1,500 1,490 Medical College, Hospital Authority, RB, MBIA Callable 07/01/08 @102 4.900%, 07/01/12 1,500 1,381 Montgomery County, Industrial Development Authority, Ser A, RB, MBIA Callable 07/03/00 @ 100 3.850%, 01/15/01 1,250 1,242 Newport News, Ser A, GO 4.000%, 07/01/07 2,000 1,798 Norfolk, Ser A, GO 5.250%, 02/01/01 2,200 2,209 Norfolk, GO Callable 06/01/04 @ 101 5.250%, 06/01/08 5,000 4,965 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Norfolk, Industrial Development Authority, Childrens Hospital Kings Group, RB, AMBAC 6.900%, 06/01/06 $ 1,000 $ 1,075 Norfolk, Industrial Development Authority, Health Care Bon Secours Health Project, RB, MBIA Callable 08/15/07 @ 102 5.250%, 08/15/26 4,200 3,662 Norfolk, Industrial Development Authority, Sentara Hospital Project, Ser A, RB Callable 11/01/04 @ 102 4.900%, 11/01/07 2,500 2,398 5.000%, 11/01/08 2,500 2,408 Norfolk, Redevelopment & Housing Authority, Educational Facilities Revenue, Tidewater Community College Campus Project, RB Callable 11/01/05 @ 102 5.800%, 11/01/08 700 719 Poquoson, Sewer System, RB 4.250%, 11/01/00 3,000 2,993 Portsmouth, GO Callable 08/01/03 @ 102 5.450%, 08/01/07 2,000 2,014 Prince William County, Park Authority, RB, ETM 5.800%, 10/15/01 500 506 Prince William County, Park Authority, RB Prerefunded @ 102 (F) 6.200%, 10/15/04 500 527 Richmond, Metropolitan Expressway Authority, Ser A, RB, FGIC Callable 07/15/02 @ 102 5.900%, 07/15/03 1,500 1,534 Roanoke, Industrial Development Authority, Roanoke Memorial Hospital Project, Ser B, RB Callable 07/01/02 @ 102 5.900%, 07/01/06 2,500 2,530 Roanoke County, Industrial Development Authority, Roanoke Memorial Hospital Project, Ser C, RB Callable 06/02/00 @ 100 4.300%, 07/01/19 200 200 Roanoke Valley, Resources Authority, RB 5.400%, 09/01/02 1,450 1,454 Roanoke Valley, Resources Authority, RB Prerefunded @102 (F) 5.750%, 09/01/02 500 516 49 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND--CONCLUDED - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Suffolk, GO 5.200%, 08/01/02 $ 1,500 $ 1,506 Suffolk, GO Callable 08/01/03 @ 102 5.600%, 08/01/06 2,000 2,033 5.700%, 08/01/07 2,000 2,036 University of Virginia, Ser A, RB Callable 06/01/08 @ 101 5.000%, 06/01/24 4,000 3,449 Virginia Beach, GO 5.450%, 07/15/11 1,000 997 Virginia Beach, Development Authority, Residential & Health Care Facility Project, 1st Mortgage, Our Lady of Perpetual Hope Project, RB Callable 07/01/07 @102 6.050%, 07/01/20 1,500 1,336 Virginia Beach, Development Authority, Sentara Bayside Hospital Project, RB Prerefunded @ 102 (F) 6.300%, 11/01/01 1,750 1,818 Virginia Beach, Development Authority, Sentra Health System, RB Callable 11/01/08 @ 101 5.250%, 11/01/11 1,000 956 Virginia Beach, Public Improvements, GO Prerefunded @ 102 (F) 5.750%, 11/01/04 3,500 3,641 Virginia State, GO 5.600%, 06/01/02 4,750 4,814 Virginia State, College Building Authority, 21st Century College Program, RB Callable 08/01/06 @ 102 5.400%, 08/01/16 1,000 941 Virginia State, College Building Authority, Public Higher Education Financing Program, Ser A, RB Callable 09/01/08 @ 100 4.625%, 09/01/15 3,080 2,654 Virginia State, College Building Authority, University of Richmond Project, RB Callable 11/01/02 @ 102 6.250%, 11/01/12 2,000 2,065 Virginia State, College Building Authority, University of Richmond Project, RB Callable 11/01/04 @ 100 5.550%, 11/01/19 6,500 6,487 Virginia State, Education Loan Authority, Guaranteed Student Loan Program, Ser B, RB, AMT 5.550%, 09/01/10 1,800 1,825 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Virginia State, Education Loan Authority, Guaranteed Student Loan Program, Ser B, RB, AMT, ETM 4.850%, 09/01/01 $ 520 $ 520 Virginia State, Education Loan Authority, Guaranteed Student Loan Program, Ser D, RB, AMT, ETM 5.600%, 03/01/03 2,500 2,525 Virginia State, Housing Development Authority, Commonwealth Mortgage, Sub-Ser B-3, RB Callable 01/01/06 @ 102 6.350%, 01/01/15 3,000 3,036 Virginia State, Housing Development Authority, Commonwealth Mortgage, Sub-Ser E-1, RB Callable 07/01/08 @ 101 4.950%, 01/01/11 1,250 1,174 Virginia State, Housing Development Authority, Multi-Family Housing, Ser E, RB Callable 01/01/08 @ 102 5.350%, 11/01/11 1,250 1,204 Virginia State, Housing Development Authority, Multi-Family Housing, Ser B, RB Callable 07/03/00 @ 102 7.375%, 05/01/05 1,000 1,021 Virginia State, Housing Development Authority, Multi-Family Housing, Ser I, RB, AMT Callable 01/01/09 @ 101 4.875%, 11/01/12 1,950 1,773 Virginia State, Housing Development Authority, Rental Housing, Ser H, RB, AMT Callable 11/01/09 @ 100 5.625%, 11/01/18 3,500 3,281 Virginia State, Housing Development Authority, Single-Family Housing, Sub-Ser C-4, RB Callable 01/01/02 @ 102 5.550%, 01/01/11 3,000 2,968 Virginia State, Housing Development Authority, Sub-Ser B-1, RB, AMT Callable 07/01/06 @ 102 6.375%, 07/01/26 2,500 2,513 50 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SHARES/FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Virginia State, Housing Development Authority, Sub-Ser C-8, RB Callable 01/01/02 @ 102 6.000%, 07/01/06 $ 2,000 $ 2,025 Virginia State, Housing Development Authority, Sub-Ser C-1, RB Callable 01/01/08 @ 102 4.850%, 07/01/09 1,600 1,515 Virginia State, Polytechnic Institute & University, Ser A, RB Callable 06/01/06 @ 102 5.350%, 06/01/09 2,000 1,993 5.450%, 06/01/13 2,500 2,448 5.500%, 06/01/16 4,435 4,289 Virginia State, Port Authority, RB, AMT 4.400%, 07/01/00 2,815 2,814 Virginia State, Public School Authority, RB Callable 01/01/02 @ 102 6.250%, 01/01/08 2,000 2,062 Virginia State, Public School Authority, School Financing, Ser I, RB 5.250%, 08/01/09 5,000 4,960 Virginia State, Public School Authority, Ser B, RB Callable 07/03/00 @ 101.5 5.850%, 01/01/02 1,500 1,520 Virginia State, Transportation Board, Northern Virginia Tranportation District, Ser A, RB Callable 05/15/06 @ 101 5.125%, 05/15/12 2,000 1,902 -------- 200,963 -------- Total Municipal Bonds (Cost $207,345) 200,963 -------- CASH EQUIVALENTS (2.6%) AIM Tax Free Institutional Cash Reserve 2,758,671 2,759 Federated Virginia Municipal Cash Trust 2,759,482 2,759 -------- Total Cash Equivalents (Cost $5,518) 5,518 -------- Total Investments (98.8%) (Cost $212,863) 206,481 -------- OTHER ASSETS AND LIABILITIES, NET (1.2%) 2,536 -------- - -------------------------------------------------------------------------------- VALUE (000) - -------------------------------------------------------------------------------- NET ASSETS: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 21,099,614 outstanding shares of beneficial interest $210,191 Fund shares of Investor Shares (unlimited authorization -- no par value) based on 710,206 outstanding shares of beneficial interest 7,315 Distribution in excess of net investment income (42) Accumulated net realized loss on investments (2,065) Net unrealized depreciation on investments (6,382) -------- Total Net Assets (100.0%) $209,017 ======== Net Asset Value, Offering and Redemption Price Per Share -- Trust Shares $ 9.58 ======== Net Asset Value and Redemption Price Per Share -- Investor Shares $ 9.59 ======== Maximum Offering Price Per Share -- Investor Shares ($9.59 / 96.25%) $ 9.96 ======== THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 51 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 VIRGINIA MUNICIPAL BOND FUND - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- MUNICIPAL BONDS (94.7%) VIRGINIA (93.6%) Albemarle County, Industrial Development Authority, Martha Jefferson Hospital Project, RB Callable 10/01/03 @ 102 5.800%, 10/01/09 $ 500 $ 503 Alexandria, Industrial Development Authority, Episcopal High School Project, RB Callable 01/01/06 @ 102 5.300%, 01/01/11 500 490 Alexandria, Industrial Development Authority, Potomac Electric Project, Ser A, RB, MBIA Callable 02/15/04 @ 102 5.375%, 02/15/24 400 365 Alexandria, Redevelopment & Housing Authority, Buckingham Village Apartments Project, Ser A, RB, AMT Callable 01/01/06 @ 102 6.050%, 07/01/16 250 249 Alexandria, Redevelopment & Housing Authority, Essex House Project, Ser A, RB, AMT Callable 01/01/08 @ 102 5.550%, 07/01/28 1,000 892 Arlington County, Industrial Development Authority, Nature Conservancy, Ser A, RB Callable 07/01/07 @ 102 5.250%, 07/01/12 300 290 Arlington County, GO Callable 06/01/05 @ 101.50 5.400%, 06/01/12 250 249 Arlington County, Industrial Development Authority, Alexandria/Arlington Waste Project, Ser B, RB, AMT Callable 07/01/08 @ 101 5.375%, 01/01/13 1,000 953 Brunswick County, Industrial Development Authority, RB, MBIA Callable 07/01/06 @ 102 5.700%, 07/01/10 1,000 1,017 5.500%, 07/01/17 400 384 Chesapeake Bay, Bridge & Tunnel Commission, RB, MBIA Callable 07/01/05 @ 102 5.000%, 07/01/22 1,000 865 Chesterfield County, GO Callable 01/15/10 5.750%, 01/15/15 1,315 1,328 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Culpeper County, 4.250%, 09/01/00 $ 1,325 $ 1,325 Fairfax County, Industrial Development Authority, Fairfax Hospital, Ser C, RB (C) 4.250%, 10/01/25 500 500 Fairfax County, Economic Development Authority, National Wildlife Federation, RB, MBIA Callable 09/01/09 @ 101 5.375%, 09/01/29 1,000 908 Fairfax County, Industrial Development Authority, Fairfax Hospital, Ser A, RB (C) 3.900%, 10/01/25 800 800 Fairfax County, Industrial Development Authority, Inova Health System Project, RB, FSA 5.250%, 08/15/19 500 460 Fairfax County, Public Improvements, Ser A, GO Callable 06/01/03 @ 102 5.000%, 06/01/07 500 494 Fairfax County, Redevelopment & Housing Authority, Mott & Gum Springs Community Centers, RB Callable 06/01/06 @ 102 5.500%, 06/01/12 425 415 Fairfax County, Redevelopment & Housing Authority, Paul Spring Center Project, Ser A, RB, FHA Callable 12/01/06 @ 103 5.900%, 06/15/17 250 242 Fairfax County, Sewer Improvement Authority, RB, MBIA Callable 07/15/06 @ 102 5.800%, 07/15/22 1,000 979 Fairfax County, Water Authority, RB Callable 04/01/07 @ 102 6.000%, 04/01/22 315 316 Fredericksburg, Industrial Development Authority, Medicorp Health System Obligation, RB, AMBAC Callable 06/15/07 @ 102 5.300%, 06/15/10 500 488 5.250%, 06/15/23 300 265 Giles County, Industrial Development Authority, Hoechst Celanese, RB, AMT Callable 05/01/06 @ 102 6.450%, 05/01/26 500 472 52 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Greater Richmond, Convention Center Authority, Convention Center Expansion Project, RB Callable 06/15/10 @ 101 5.900%, 06/15/16 $ 835 $ 830 Greater Richmond, Convention Center Hotel, Convention Center Expansion Project, RB Callable 6/15/10 @ 101 6.125%, 06/15/25 1,200 1,193 Hampton, Golf Course Project, RB 6.000%, 12/01/12 1,410 1,394 Henrico County, Economic Development Authority, Beth Sholom Assisted Living, Ser A, RB, GNMA Callable 07/20/09 @ 102 5.850%, 07/20/19 400 387 5.900%, 07/20/29 500 477 Henrico County, Industrial Development Authority, Educational Facility, Collegiate Schools, RB Callable 10/15/08 @ 102 5.000%, 10/15/19 1,000 867 Henrico County, Industrial Development Authority, Westminster-Canterbury Project, RB Callable 10/1/09 @ 101 5.700%, 10/01/23 1,000 887 5.700%, 10/01/29 800 698 Henry County, Industrial Development Authority, Memorial Hospital, Martinsville & Henry Hospital Project, RB Callable 01/01/07 @ 101 6.000%, 01/01/17 500 492 James City County, GO, FGIC Callable 12/15/05 @ 102 5.250%, 12/15/14 250 241 Loudoun County, Sanitation Authority, Water & Sewer Project, RB, FGIC Callable 01/01/07 @ 102 5.125%, 01/01/26 500 435 Loudoun County, Public Improvement Project, Ser C, GO Callable 12/01/09 @ 101 5.750%, 12/01/19 1,050 1,035 Lynchburg, Industrial Development Authority, Health Care Facility, Centra Health Project, RB Callable 01/01/08 @ 101 5.200%, 01/01/23 500 419 - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Lynchburg, Public Improvements, GO Callable 05/01/06 @ 102 5.100%, 05/01/11 $ 500 $ 484 Manassas Park, GO, FSA Callable 04/01/09 @ 101 5.100%, 04/01/22 500 442 Manassas, Ser A, GO Callable 01/01/08 @ 102 5.000%, 01/01/18 500 447 Newport News, BAN 4.500%, 06/15/00 1,500 1,500 Newport News, Ser A, GO, MBIA Callable 07/01/05 @ 102 5.625%, 07/01/14 1,500 1,500 Newport News, Redevelopment & Housing Authority, Ser A, RB, GNMA Callable 08/20/07 @102 5.850%, 12/20/30 500 475 Norfolk, Water Authority, RB, AMBAC Callable 11/01/03 @ 102 5.625%, 11/01/23 690 631 Norfolk, Industrial Development Authority, Health Care, Bon Secours Health System Project, RB, MBIA Callable 08/15/07 @ 102 5.250%, 08/15/17 750 686 Norfork, GO Callable 02/01/03 @ 102 5.500%, 02/01/13 475 468 Portsmouth, GO, FGIC Callable 08/01/06 @ 101 5.250%, 08/01/21 500 453 Richmond, Public Improvements, Ser B, GO, Callable 01/15/01 @ 102 6.250%, 01/15/18 1,000 1,028 Riverside, Regional Jail Authority, Correctional Facility Improvements Project, RB, MBIA Callable 07/01/05 @ 102 5.875%, 07/01/14 2,000 2,019 Roanoke County, Industrial Development Authority, Roanoke Memorial Hospital Project, Ser C, RB Callable 06/09/00 @ 100 4.300%, 07/01/19 965 965 Roanoke, Public Improvements, GO Callable 08/01/04 @ 102 5.150%, 08/01/12 250 240 Spotsylvania County, GO, FSA 5.000%, 07/15/14 1,000 941 Spotsylvania County, Water & Sewer System, RB, MBIA Callable 06/01/07 @ 102 5.250%, 06/01/12 500 484 53 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 VIRGINIA MUNICIPAL BOND FUND--CONCLUDED - -------------------------------------------------------------------------------- FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Spotsylvania County, Water & Sewer System Authority, RB, MBIA Callable 06/01/07 @ 102 5.400%, 06/01/27 $ 1,000 $ 915 Virginia Beach, GO 5.450%, 07/15/11 200 199 Virginia State, Biotechnology Research Park Authority, Biotech Two Project, RB Callable 09/01/06 @ 101 5.250%, 09/01/18 500 461 Virginia State, College Building Authority, Educational Facilities, Marymount University Project, RB, Callable 07/01/08 @ 102 5.100%, 07/01/18 1,000 881 Virginia State, College Building Authority, Washington & Lee University Project, RB, MBIA 5.250%, 01/01/31 1,100 989 Virginia State, Housing Development Authority, Commonwealth Mortgage Project, Sub-Ser E-3, RB Callable 07/01/08 @ 101 5.125%, 07/01/17 2,000 1,795 Virginia State, Housing Development Authority, Commonwealth Mortgage Project, Sub-Ser A-4, RB, AMT, MBIA Callable 01/01/06 @ 102 6.350%, 07/01/18 150 151 Virginia State, Housing Development Authority, Commonwealth Mortgage Project, Sub-Ser A-1, RB Callable 01/01/03 @ 102 6.400%, 07/01/17 875 886 Virginia State, Housing Development Authority, Commonwealth Mortgage Project, Sub-Ser E-2, RB Callable 07/01/08 @101 5.250%, 07/01/17 1,000 912 Virginia State, Polytechnic Institute & State University, University Service Systems, Ser C, RB Callable 06/01/06 @ 102 5.500%, 06/01/16 200 193 Virginia State, Public Building Authority, Public Improvements, RB Callable 08/01/05 @ 101 5.200%, 08/01/16 300 279 - -------------------------------------------------------------------------------- SHARES/FACE AMOUNT (000) VALUE (000) - -------------------------------------------------------------------------------- VIRGINIA--CONTINUED Virgina State, Public Building Authority, Ser A, Callable 08/01/10 @ 100 5.750%, 08/01/16 $ 1,500 $ 1,494 Virginia State, Public School Authority, School Financing, Ser A, RB Callable 08/01/07 @ 102 5.375%, 08/01/18 500 470 Virginia State, Resource Authority, RB, MBIA Callable 05/01/11 @ 101 5.800%, 05/01/30 1,500 1,456 Virginia State, University of Virginia, Ser A, RB Callable 05/01/06 @ 102 5.625%, 05/01/16 1,000 981 West Point, Industrial Development Authority, Chesapeake Project, Ser B, RB Callable 03/01/04 @ 102 6.250%, 03/01/19 165 151 Williamsburg, Industrial Development Authority, Williamsburg Community Hospital, RB Callable 10/01/03 @ 102 5.750%, 10/01/22 1,450 1,302 ------- 50,882 ------- PUERTO RICO (1.1%) Commonwealth, San Lucas & Cristo Project, Ser A , RB Callable 06/01/09 @ 101 5.750%, 06/01/29 740 604 ------- Total Municipal Bonds (Cost $53,737) 51,486 ------- CASH EQUIVALENTS (2.2%) AIM Tax Free Institutional Cash Reserve 602,404 602 Federated Virginia Municipal Cash Trust 601,758 602 ------- Total Cash Equivalents (Cost $1,204) 1,204 ------- Total Investments (96.9%) (Cost $54,941) 52,690 ------- OTHER ASSETS AND LIABILITIES, NET (3.1%) 1,657 ------- 54 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- VALUE (000) - -------------------------------------------------------------------------------- NET ASSETS: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 5,080,916 outstanding shares of beneficial interest $51,256 Fund shares of Flex Shares (unlimited authorization -- no par value) based on 554,190 outstanding shares of beneficial interest 5,910 Distribution in excess of net investment income (24) Accumulated net realized loss on investments (544) Net unrealized depreciation on investments (2,251) ------- Total Net Assets (100.0%) $54,347 ======= Net Asset Value, Offering and Redemption Price Per Share -- Trust Shares $ 9.64 ======= Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) $ 9.68 ======= (1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE, SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. FOR DESCRIPTIONS OF ABBREVIATIONS, PLEASE SEE PAGE 56. 55 STATEMENT OF NET ASSETS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 KEY TO ABBREVIATIONS USED IN THE STATEMENT OF NET ASSETS AMBAC Security insured by the American Municipal Bond Assurance Corporation AMT Alternative Minimum Tax BAN Bond Anticipation Note Cl Class COP Certificate of Participation ETM Escrowed to Maturity FGIC Security insured by the Financial Guaranty Insurance Company FFCB Federal Farm Credit Bank FHA Federal Housing Authority FHLMC Federal Home Loan Mortgage Corporation FNMA Federal National Mortgage Association FSA Security insured by Financial Security Assurance GNMA Government National Mortgage Association GO General Obligation MBIA Security insured by the Municipal Bond Insurance Association MTN Medium Term Note PLC Public Limited Company RB Revenue Bond REMIC Real Estate Mortgage Investment Conduit Ser Series STRIPS Separately Traded Registered Interest and Principal Security TA Tax Allocation (A) Zero Coupon Bond (B) Private Placement Security (C) Adjustable rate security. The rate reported on the Statement of Net Assets is the rate in effect on May 31, 2000. (D) Put and demand features exist requiring the issuer to repurchase the instrument prior to maturity. (E) Securities are held in connection with a letter of credit issued by a major bank. (F) Prerefunded Security. The maturity date shown is the prerefunded date. (G) Tri-Party Repurchase Agreement 56 STATEMENT OF ASSETS AND LIABILITIES (000) - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000
Investment Grade Tax-Exempt Bond Fund ---------------- ASSETS: Investments at value (Cost $165,479) ............................................. $164,613 Cash ............................................................................. 182 Accrued income ................................................................... 2,952 Receivable for investment securities sold ........................................ 10,273 Receivable for portfolio shares purchased ........................................ 184 -------- Total Assets ..................................................................... 178,204 -------- LIABILITIES: Payable for investment securities purchased ...................................... 25,883 Accrued expenses ................................................................. 146 Payable for portfolio shares redeemed ............................................ 134 Distributions payable ............................................................ 536 -------- Total liabilities ................................................................... 26,699 -------- Net Assets .......................................................................... $151,505 ======== NET ASSETS: Fund shares of Trust Shares (unlimited authorization -- no par value) based on 10,998,329 outstanding shares of beneficial interest ............................. $122,291 Fund shares of Investor Shares (unlimited authorization -- no par value) based on 1,820,120 outstanding shares of beneficial interest .............................. 19,153 Fund shares of Flex Shares (unlimited authorization -- no par value) based on 1,375,312 outstanding shares of beneficial interest .............................. 15,610 Distribution in excess of net investment income ..................................... (5) Accumulated net realized loss on investments ........................................ (4,678) Net unrealized depreciation on investments .......................................... (866) -------- Total Net Assets (100.0%) ........................................................... $151,505 ======== Net Asset Value, Offering and Redemption Price Per Share -- Trust Shares ............ $ 10.67 ======== Net Asset Value and Redemption Price Per Share -- Investor Shares ................... $ 10.68 ======== Maximum Offering Price Per Share -- Investor Shares ($10.68 / 96.25%) ............... $ 11.10 ======== Net Asset Value, Offering and Redemption Price Per Share -- Flex Shares (1) ......... $ 10.67 ========
(1) THE FLEX SHARES HAVE A CONTINGENT SALES CHARGE. FOR A DESCRIPTION OF A POSSIBLE SALES CHARGE, SEE NOTES TO THE FINANCIAL STATEMENTS. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. 57 STATEMENTS OF OPERATIONS (000) - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, 2000 AND MARCH 31, 2000
INVESTMENT FLORIDA GEORGIA HIGH INVESTMENT GRADE TAX-EXEMPT TAX-EXEMPT INCOME GRADE BOND TAX-EXEMPT BOND FUND BOND FUND FUND (1) FUND BOND FUND ---------- ---------- -------------------- ----------- ----------- 06/01/99- 06/01/99 - 04/01/00 04/01/99 - 06/01/99 - 06/01/99 - 05/31/00 05/31/00 05/31/00 03/31/00 05/31/00 05/31/00 ---------- ---------- -------------------- ----------- ----------- Interest Income ....................................... $ 5,916 $ 4,720 $ 35 $ 643 $ 78,585 $8,255 ------- ------- ---- ----- -------- ------ Expenses: Investment Advisory Fees ........................... 780 637 3 60 8,537 1,285 Less: Investment Advisory Fees Waived (Reimbursed) ............................ (130) (113) (3) (74) (798) (109) Administrator Fees ................................. 85 69 -- 9 817 123 Transfer Agent Fees-- Trust Shares ................. 17 16 -- -- 21 16 Transfer Agent Fees-- Investor Shares .............. 13 15 -- -- 31 17 Transfer Agent Fees-- Flex Shares .................. 17 16 3 -- 39 21 Transfer Agent Out of Pocket Expenses .............. 9 7 -- 19 28 4 Printing Expenses .................................. 8 7 -- -- 35 -- Custody Fees ....................................... 7 5 -- 9 42 -- Professional Fees .................................. 8 7 -- 14 65 -- Trustee Fees ....................................... 1 1 -- -- 12 -- Registration Fees .................................. 7 11 -- 16 62 13 Distribution Fees-- Investor Shares ................ 6 6 -- -- 129 96 Less: Distribution Fees Waived-- Investor Shares ... (6) (6) -- -- (38) (22) Distribution Fees-- Flex Shares .................... 127 113 4 18 249 163 Less: Distribution Fees Waived-- Flex Shares ....... (53) (47) (2) -- (65) (38) Insurance and Other Fees ........................... 7 1 1 36 53 2 ------- ------- ---- ----- -------- ------ Total Expenses ..................................... 903 745 6 107 9,219 1,571 ------- ------- ---- ----- -------- ------ Net Investment Income ................................. 5,013 3,975 29 536 69,366 6,684 ------- ------- ---- ----- -------- ------ Net Realized and Unrealized Gain (Loss) on Investments: Net Realized Loss on Securities Sold ............... (2,256) (836) -- (768) (37,713) (4,664) Net Change in Unrealized Depreciation on Investments ...................................... (3,755) (4,265) (30) (130) (50,059) (287) ------- ------- ---- ----- -------- ------ Total Net Realized and Unrealized Loss on Investments ...................................... (6,011) (5,101) (30) (898) (87,772) (4,951) ------- ------- ---- ----- -------- ------ Net Increase (Decrease) in Net Assets from Operations ................................ $ (998) $(1,126) $ (1) $(362) $(18,406) $1,733 ======= ======= ==== ===== ======== ====== Amounts designated as "--" are either $0 or round to $0. (1) ON MARCH 27, 2000, THE ESC STRATEGIC INCOME FUND EXCHANGED ALL OF ITS ASSETS AND CERTAIN LIABILITIES FOR SHARES OF THE HIGH INCOME FUND. THE ESC STRATEGIC INCOME FUND IS THE ACCOUNTING SURVIVOR IN THIS TRANSACTION, AND AS A RESULT, ITS BASIS OF ACCOUNTING FOR ASSETS AND LIABILITIES AND ITS OPERATING RESULTS FOR THE PERIODS PRIOR TO MARCH 27, 2000 HAVE BEEN CARRIED FORWARD IN THESE FINANCIAL HIGHLIGHTS. SUBSEQUENT TO THE MERGER, THE HIGH INCOME FUND CHANGED ITS FISCAL YEAR-END TO MAY 31.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. 58 - --------------------------------------------------------------------------------
LIMITED- TERM FEDERAL SHORT-TERM VIRGINIA MORTGAGE MARYLAND U.S. TREASURY U.S. INTERMEDIATE VIRGINIA SECURITIES MUNICIPAL SHORT-TERM SECURITIES GOVERNMENT MUNICIPAL MUNICIPAL FUND BOND FUND BOND FUND FUND SECURITIES FUND BOND FUND BOND FUND ------------ ---------- ---------- ------------- --------------- ------------ ----------- 06/01/99 - 06/01/99 - 06/01/99 - 06/01/99 - 06/01/99 - 06/01/99 - 06/01/99 - 05/31/00 05/31/00 05/31/00 05/31/00 05/31/00 05/31/00 05/31/00 ------------ ---------- ---------- ------------- --------------- ------------ ----------- $ 8,706 $ 1,726 $12,129 $3,593 $ 6,711 $ 11,824 $ 2,433 ------- ------- ------- ------ ------- -------- ------- 904 228 1,295 435 758 1,551 300 (162) (42) (185) (88) (88) -- (20) 98 25 141 47 73 170 36 13 16 17 15 16 7 16 12 -- 14 14 14 13 -- 14 15 14 16 22 -- 13 14 2 14 6 7 -- 2 10 2 13 5 8 4 3 8 1 8 4 6 4 3 13 2 10 4 7 20 5 1 -- 3 1 1 -- -- 17 -- 9 7 11 -- 2 4 -- 4 5 8 11 -- (3) -- (4) (5) (8) (11) -- 22 75 21 56 104 -- 62 (22) (18) (21) (47) (48) -- (26) 9 2 2 2 4 -- 3 ------- ------- ------- ------ ------- -------- ------- 952 308 1,355 477 895 1,769 399 ------- ------- ------- ------ ------- -------- ------- 7,754 1,418 10,774 3,116 5,816 10,055 2,034 ------- ------- ------- ------ ------- -------- ------- (2,174) (237) (2,130) (8) (1,586) (1,940) (544) (2,454) (1,990) (3,306) (621) (2,873) (11,451) (2,611) ------- ------- ------- ------ ------- -------- ------- (4,628) (2,227) (5,436) (629) (4,459) (13,391) (3,155) ------- ------- ------- ------ ------- -------- ------- $ 3,126 $ (809) $ 5,338 $2,487 $ 1,357 $ (3,336) $(1,121) ======= ======= ======= ====== ======= ======== =======
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. 59 STATEMENTS OF CHANGES IN NET ASSETS (000) - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, MARCH 31, AND NOVEMBER 30, FLORIDA TAX-EXEMPT GEORGIA TAX-EXEMPT BOND FUND BOND FUND HIGH INCOME FUND ---------------------- ----------------------- ------------------------------ 06/01/99- 06/01/98- 06/01/99- 06/01/98- 04/01/00- 04/01/99 04/01/98 05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 03/31/00 03/31/99 ---------------------- ----------------------- --------- -------- -------- Operations: Net Investment Income ....................... $ 5,013 $ 4,737 $ 3,975 $ 3,344 $ 29 $ 536 $ 852 Net Realized Gain (Loss) on Investments ..... (2,256) 1,160 (836) 414 -- (768) 57 Net Change in Unrealized Appreciation (Depreciation) on Investments ............. (3,755) (1,845) (4,265) (1,241) (30) (130) (194) -------- -------- --------- -------- ------ ------- -------- Increase (Decrease) in Net Assets from Operations ......................... (998) 4,052 (1,126) 2,517 (1) (362) 715 -------- -------- --------- -------- ------ ------- -------- Distributions to Shareholders: Net Investment Income: Trust Shares .............................. (4,437) (4,235) (3,459) (2,897) -- -- -- Investor Shares ........................... (127) (134) (129) (128) -- -- -- Flex Shares ............................... (449) (369) (388) (318) (29) (479)* (759) Class D Shares ............................ -- -- -- -- -- (39) (33) Tax Return of Capital: Class D Shares ............................ -- -- -- -- -- -- (77) Flex Shares ............................... -- -- -- -- -- -- (3)* Capital Gains: Trust Shares .............................. (400) (1,037) (301) (162) -- -- -- Investor Shares ........................... (12) (37) (13) (8) -- -- -- Flex Shares ............................... (46) (122) (42) (20) -- -- (105)* Class D Shares ............................ -- -- -- -- -- -- (9) -------- -------- --------- -------- ------ ------- -------- Total Distributions ......................... (5,471) (5,934) (4,332) (3,533) (29) (518) (986) -------- -------- --------- -------- ------ ------- -------- Capital Transactions (1): Trust Shares: Proceeds from Shares Issued ............... 28,674 51,929 26,583 36,255 -- -- -- Shares Issued in Connection with Crestar Merger .......................... -- -- -- -- -- -- -- Reinvestment of Cash Distributions 889 1,663 1,355 1,180 -- -- -- Cost of Shares Repurchased (49,546) (27,307) (29,630) (11,514) -- -- -- -------- -------- --------- -------- ------ ------- -------- Increase (Decrease) in Net Assets From Trust Share Transactions (19,983) 26,285 (1,692) 25,921 -- -- -- -------- -------- --------- -------- ------ ------- -------- Investor Shares: Proceeds from Shares Issued 165 1,105 557 1,195 -- -- -- Shares Issued in Connection with Crestar Merger .......................... -- -- -- -- -- -- -- Reinvestment of Cash Distributions ........ 120 143 108 118 -- -- -- Cost of Shares Repurchased ................ (1,034) (780) (1,698) (1,586) -- -- -- -------- -------- --------- -------- ------ ------- -------- Increase (Decrease) in Net Assets From Investor Share Transactions ........................ (749) 468 (1,033) (273) -- -- -- -------- -------- --------- -------- ------ ------- -------- Flex Shares: Proceeds from Shares Issued ............... 2,953 11,906 1,933 5,982 1,165 851 926 Shares Issued in Connection with ESC Merger -- -- -- -- -- 352 -- Shares Issued in Connection with Crestar Merger ......................... -- -- -- -- -- -- -- Reinvestment of Cash Distributions ....... 427 433 410 304 21 463 894 Cost of Shares Repurchased ............... (7,643) (5,520) (6,201) (1,034) (113) (6,073) (18,743) -------- -------- --------- -------- ------ ------- -------- Increase (Decrease) in Net Assets From Flex Share Transactions ....................... (4,263) 6,819 (3,858) 5,252 1,073 (4,407) (16,923) -------- -------- --------- -------- ------ ------- -------- Class D: Proceeds from Shares Issued .............. -- -- -- -- -- 42 156 Reinvestment of Cash Distributions ....... -- -- -- -- -- 42 41 Value of Shares Exchanged in Connection with Merger ...................... -- -- -- -- -- (352) -- Cost of Shares Repurchased ............... -- -- -- -- -- (191) (461) -------- -------- --------- -------- ------ ------- -------- Increase (Decrease) in Net Assets From Class D Share Transactions ............... -- -- -- -- -- (459) (264) -------- -------- --------- -------- ------ ------- -------- Increase (Decrease) in Net Assets From Share Transactions ....................... (24,995) 33,572 (6,583) 30,900 1,073 (4,866) (17,187) -------- -------- --------- -------- ------ ------- -------- Total Increase (Decrease) in Net Assets (31,464) 31,690 (12,041) 29,884 1,043 (5,746) (17,458) -------- -------- --------- -------- ------ ------- -------- Net Assets: Beginning of Period ........................ 137,170 105,480 104,486 74,602 2,032 7,778 25,236 -------- -------- --------- -------- ------ ------- -------- End of Period .............................. $105,706 $137,170 $ 92,445 $104,486 $3,075 $ 2,032 $ 7,778 ======== ======== ========= ======== ====== ======= ======== * Formerly Class A Shares (1) See Note 6 in the notes to the financial statements for additional information. Amounts designated as "--" are either $0 or round to $0. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 60 - ----------------------------------------------------------------------------------------------------------------------------------- INVESTMENT GRADE INVESTMENT GRADE TAX- LIMITED-TERM FEDERAL MARYLAND MUNICIPAL BOND FUND EXEMPT BOND FUND MORTGAGE SECURITIES FUND BOND FUND -------------------- -------------------- ------------------------ ------------------------------ 06/01/99- 06/01/98- 06/01/99- 06/01/98- 06/01/99- 06/01/98- 06/01/99- 12/01/98- 12/01/97- 05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 05/31/99 11/30/98 --------- --------- --------- --------- --------- ---------- --------- --------- --------- $ 69,366 $ 45,781 $ 6,684 $ 6,793 $ 7,754 $ 7,741 $ 1,418 $ 497 $ 701 (37,713) 15,248 (4,664) 4,833 (2,174) 88 (237) (19) 58 (50,059) (27,720) (287) (3,278) (2,454) (1,037) (1,990) (437) 406 - ---------- --------- ------- ------- ------- --------- ------- ------- ------- (18,406) 33,309 1,733 8,348 3,126 6,792 (809) 41 1,165 - ---------- --------- ------- ------- ------- --------- ------- ------- ------- (66,271) (43,474) (5,389) (5,587) (7,518) (7,568) (1,195) (425) (645) (1,676) (1,621) (798) (901) (93) (125) -- -- -- (1,277) (807) (504) (305) (110) (83) (257) (77) (56) -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- (13,468) (1,805) (4,790) -- (1,611) -- (24) -- -- (547) (295) (914) -- (28) -- -- -- -- (306) (216) (323) -- (19) -- (4) -- -- -- -- -- -- -- -- -- -- - ---------- --------- ------- ------- ------- --------- ------- ------- ------- (69,224) (60,223) (9,007) (12,820) (7,721) (9,434) (1,452) (530) (701) - ---------- --------- ------- ------- ------- --------- ------- ------- ------- 254,865 310,338 29,272 58,516 52,959 54,404 18,759 15,770 13,041 -- 314,362 -- -- -- -- -- -- -- 36,906 42,773 2,726 5,421 4,795 6,287 200 14 11 (358,628) (286,648) (63,059) (52,929) (63,196) (60,354) (20,670) (4,854) (5,813) - ---------- --------- ------- ------- ------- --------- ------- ------- ------- (66,857) 380,825 (31,061) 11,008 (5,442) 337 (1,711) 10,930 7,239 - ---------- --------- ------- ------- ------- --------- ------- ------- ------- 3,327 8,100 686 2,158 307 853 -- -- -- -- 2,385 -- -- -- -- -- -- -- 1,676 2,052 980 1,627 93 151 -- -- -- (15,192) (9,990) (6,471) (6,100) (1,359) (1,458) -- -- -- - ---------- --------- ------- ------- ------- --------- ------- ------- ------- (10,189) 2,547 (4,805) (2,315) (959) (454) -- -- -- - ---------- --------- ------- ------- ------- --------- ------- ------- ------- 9,687 19,438 7,055 10,543 792 1,082 2,326 4,739 2,772 -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- 1,235 1,002 670 551 103 96 216 66 41 (15,042) (6,765) (8,916) (2,643) (1,233) (566) (3,563) (226) (177) - ---------- --------- ------- ------- ------- --------- ------- ------- ------- (4,120) 13,675 (1,191) 8,451 (338) 612 (1,021) 4,579 2,636 - ---------- --------- ------- ------- ------- --------- ------- ------- ------- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- - ---------- ---------- ------- ------- ------- --------- ------- ------- ------- -- -- -- -- -- -- -- -- -- - ---------- ---------- ------- ------- ------- --------- ------- ------- ------- (81,166) 397,047 (37,057) 17,144 (6,739) 495 (2,732) 15,509 9,875 - ---------- ---------- ------- ------- ------- --------- ------- ------- ------- (168,796) 370,133 (44,331) 12,672 (11,334) (2,147) (4,993) 15,020 10,339 - ---------- ---------- ------- ------- ------- --------- ------- ------- ------- 1,210,001 839,868 195,836 183,164 139,589 141,736 37,381 22,361 12,022 - ---------- ---------- -------- ------- ------- --------- ------- ------- ------- $1,041,205 $1,210,001 $151,505 $195,836 $128,255 $139,589 $32,388 $37,381 $22,361 ========== ========== ======== ======== ======== ======== ======= ======= =======
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 61 STATEMENTS OF CHANGES IN NET ASSETS (000) - ----------------------------------------------------------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, AND NOVEMBER 30, SHORT-TERM SHORT-TERM U.S. TREASURY BOND FUND SECURITIES FUND ------------------------- -------------------------- 06/01/99- 06/01/98- 06/01/99- 06/01/98- 05/31/00 05/31/99 05/31/00 05/31/99 ---------- ---------- ---------- ----------- Operations: Net Investment Income ................................ $ 10,774 $ 6,990 $ 3,116 $ 2,525 Net Realized Gain (Loss) on Investments .............. (2,130) 414 (8) 243 Net Change in Unrealized Appreciation (Depreciation) on Investments .................. (3,306) (2,357) (621) (388) -------- -------- ------- ------- Increase (Decrease) in Net Assets from Operations .. 5,338 5,047 2,487 2,380 -------- -------- ------- ------- Distributions to Shareholders: Net Investment Income: Trust Shares ....................................... (10,579) (6,805) (2,756) (2,281) Investor Shares .................................... (91) (92) (122) (133) Flex Shares ........................................ (103) (95) (238) (111) Capital Gains: Trust Shares ....................................... (139) (356) (7) -- Investor Shares .................................... (1) (4) -- -- Flex Shares ........................................ (2) (5) (1) -- -------- -------- ------- ------- Total Distributions .................................. (10,915) (7,357) (3,124) (2,525) -------- -------- ------- ------- Capital Transactions (1): Trust Shares: Proceeds from Shares Issued ........................ 51,792 57,981 31,143 17,499 Shares Issued in Connection with Crestar Merger .... -- 72,757 -- -- Reinvestment of Cash Distributions ................. 4,667 3,614 1,435 951 Cost of Shares Repurchased ......................... (80,493) (42,626) (15,480) (9,243) -------- -------- ------- ------- Increase (Decrease) in Net Assets From Trust Share Transactions ....................................... (24,034) 91,726 17,098 9,207 -------- -------- ------- ------- Investor Shares: Proceeds from Shares Issued ........................ 402 589 738 1,382 Reinvestment of Cash Distributions ................. 88 94 122 133 Cost of Shares Repurchased ......................... (821) (781) (1,566) (1,983) -------- -------- ------- ------- Increase (Decrease) in Net Assets From Investor Share Transactions ................................. (331) (98) (706) (468) -------- -------- ------- ------- Flex Shares: Proceeds from Shares Issued ........................ 1,164 2,540 3,365 5,314 Shares Issued in Connection with Crestar Merger .... -- -- -- -- Reinvestment of Cash Distributions ................. 107 96 218 94 Cost of Shares Repurchased ......................... (1,486) (2,365) (3,068) (1,855) -------- -------- ------- ------- Increase (Decrease) in Net Assets From Flex Share Transactions .............................. (215) 271 515 3,553 -------- -------- ------- ------- Increase (Decrease) in Net Assets From Share Transactions .................................... (24,580) 91,899 16,907 12,292 -------- -------- ------- ------- Total Increase (Decrease) in Net Assets .......... (30,157) 89,589 16,270 12,147 -------- -------- ------- ------- Net Assets: Beginning of Period .................................. 214,070 124,481 63,757 51,610 -------- -------- ------- ------- End of Period ........................................ $183,913 $214,070 $ 80,027 $63,757 ======== ======== ======== ======= (1) See Note 6 in the notes to the financial statements for additional information. Amounts designated as "--" are either $0 or round to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 62 - ------------------------------------------------------------------------------------------------------------------------------------ U. S. GOVERNMENT SECURITIES FUND VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND VIRGINIA MUNICIPAL BOND FUND ----------------------- ----------------------------------------- ---------------------------------- 06/01/99- 06/01/98- 06/01/99- 12/01/98- 12/01/97- 06/01/99- 12/01/98- 12/01/97- 05/31/00 05/31/99 05/31/00 05/31/99 11/30/98 05/31/00 05/31/99 11/30/98 --------- --------- ----------- ---------- -------- --------- -------- --------- $ 5,816 $ 2,793 $ 10,055 $ 5,222 $ 10,809 $ 2,034 $ 734 $ 1,203 (1,586) 15 (1,940) 1,177 1,725 (544) 31 175 (2,873) (1,299) (11,451) (5,509) 2,380 (2,611) (722) 507 ------- ------- -------- -------- -------- -------- ------ ------- 1,357 1,509 (3,336) 890 14,914 (1,121) 43 1,885 ------- ------- -------- -------- -------- -------- ------ ------- (5,199) (2,385) (9,828) (5,069) (10,471) (1,835) (650) (1,116) (111) (153) (320) (166) (364) -- -- -- (506) (252) -- -- -- (223) (88) (87) -- -- (1,262) (1,670) (793) (27) (155) (50) -- -- (39) (56) (28) -- -- -- -- -- -- -- -- (4) (20) (4) ------- ------- -------- -------- -------- -------- ------ ------- (5,816) (2,790) (11,449) (6,961) (11,656) (2,089) (913) (1,257) ------- ------- -------- -------- -------- -------- ------ ------- 27,984 23,161 26,550 26,357 36,891 32,391 7,281 13,751 -- 56,128 -- -- -- -- -- -- 1,272 520 952 43 629 262 29 60 (42,103) (11,462) (51,050) (24,041) (34,155) (12,912) (3,890) (5,172) ------- ------- -------- -------- -------- -------- ------ ------- (12,847) 68,347 (23,548) 2,359 3,365 19,741 3,420 8,639 ------- ------- -------- -------- -------- -------- ------ ------- 416 956 1,441 653 2,174 -- -- -- 111 152 275 164 289 -- -- -- (1,560) (1,762) (2,155) (821) (2,503) -- -- -- ------- ------- -------- -------- -------- -------- ------ ------- (1,033) (654) (439) (4) (40) -- -- -- ------- ------- -------- -------- -------- -------- ------ ------- 2,396 5,920 -- -- -- 1,607 3,816 2,474 -- 3,174 -- -- -- -- -- -- 443 206 -- -- -- 153 77 64 (6,144) (1,637) -- -- -- (2,822) (514) (376) ------- ------- -------- -------- -------- -------- ------ ------- (3,305) 7,663 -- -- -- (1,062) 3,379 2,162 ------- ------- -------- -------- -------- -------- ------ ------- (17,185) 75,356 (23,987) 2,355 3,325 18,679 6,799 10,801 ------- ------- -------- -------- -------- -------- ------ ------- (21,644) 74,075 (38,772) (3,716) 6,583 15,469 5,929 11,429 ------- ------- -------- -------- -------- -------- ------ ------- 116,221 42,146 247,789 251,505 244,922 38,878 32,949 21,520 ------- ------- -------- -------- -------- -------- ------ ------- $ 94,577 $116,221 $209,017 $247,789 $251,505 $ 54,347 $38,878 $32,949 ======== ======== ======== ======== ======== ======== ======= =======
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 63 FINANCIAL HIGHLIGHTS - ----------------------------------------------------------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, (UNLESS OTHERWISE INDICATED) FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS NET ASSET NET REALIZED AND DISTRIBUTIONS DISTRIBUTIONS VALUE NET UNREALIZED GAINS FROM NET DISTRIBUTIONS FROM TAX NET ASSET BEGINNING INVESTMENT (LOSSES) INVESTMENT FROM REALIZED RETURN OF VALUE END OF PERIOD INCOME ON INVESTMENTS INCOME CAPITAL GAINS CAPITAL OF PERIOD ---------- ----------- ---------------- ------------- ------------- ------------- --------- Florida Tax-Exempt Bond Fund Trust Shares 2000 $10.59 $ 0.44 $(0.49) $(0.44) $(0.04) $ -- $10.06 1999 10.72 0.42 (0.02) (0.42) (0.11) -- 10.59 1998 10.28 0.44 0.45 (0.44) (0.01) -- 10.72 1997 10.06 0.46 0.25 (0.46) (0.03) -- 10.28 1996 10.18 0.46 (0.07) (0.46) (0.05) -- 10.06 Investor Shares 2000 $10.60 $ 0.42 $(0.49) $(0.42) $(0.04) $ -- $10.07 1999 10.72 0.40 (0.01) (0.40) (0.11) -- 10.60 1998 10.29 0.42 0.44 (0.42) (0.01) -- 10.72 1997 10.07 0.44 0.25 (0.44) (0.03) -- 10.29 1996 10.18 0.44 (0.06) (0.44) (0.05) -- 10.07 Flex Shares 2000 $10.62 $ 0.36 $(0.49) $(0.36) $(0.04) $ -- $10.09 1999 10.74 0.35 (0.01) (0.35) (0.11) -- 10.62 1998 10.30 0.37 0.45 (0.37) (0.01) -- 10.74 1997 10.08 0.39 0.25 (0.39) (0.03) -- 10.30 1996(1) 10.19 0.39 (0.06) (0.39) (0.05) -- 10.08 Georgia Tax-Exempt Bond Fund Trust Shares 2000 $10.03 $ 0.40 $(0.49) $(0.40) $(0.04) $ -- $ 9.50 1999 10.11 0.39 (0.06) (0.39) (0.02) -- 10.03 1998 9.73 0.41 0.39 (0.41) (0.01) -- 10.11 1997 9.56 0.42 0.22 (0.42) (0.05) -- 9.73 1996 9.63 0.43 (0.05) (0.43) (0.02) -- 9.56 Investor Shares 2000 $10.05 $ 0.38 $(0.50) $(0.38) $(0.04) $ -- $ 9.51 1999 10.13 0.37 (0.06) (0.37) (0.02) -- 10.05 1998 9.74 0.39 0.40 (0.39) (0.01) -- 10.13 1997 9.58 0.40 0.21 (0.40) (0.05) -- 9.74 1996 9.65 0.41 (0.05) (0.41) (0.02) -- 9.58 Flex Shares 2000 $10.04 $ 0.33 $(0.49) $(0.33) $(0.04) $ -- $ 9.51 1999 10.12 0.32 (0.06) (0.32) (0.02) -- 10.04 1998 9.73 0.34 0.40 (0.34) (0.01) -- 10.12 1997 9.56 0.35 0.22 (0.35) (0.05) -- 9.73 1996(2) 9.72 0.36 (0.14) (0.36) (0.02) -- 9.56 High Income Fund (A) Flex Shares 2000(4) $ 7.98 $ 0.09 $(0.10) $(0.09) $ -- $ -- $ 7.88 For the years ended March 31: 2000 9.77 0.87 (1.85) (0.81) -- -- 7.98 1999 9.99 0.51 0.04 (0.57) (0.15) (0.05) 9.77 1998 9.73 0.34 0.44 (0.52) -- -- 9.99 1997 9.89 0.60 (0.16) (0.60) -- -- 9.73 1996 9.94 0.59 0.16 (0.59) (0.21) -- 9.89 Investment Grade Bond Fund Trust Shares 2000 $10.36 $ 0.61 $(0.78) $(0.61) $ -- $ -- $ 9.58 1999 10.65 0.56 (0.11) (0.56) (0.18) -- 10.36 1998 10.16 0.60 0.49 (0.60) -- -- 10.65 1997 10.07 0.60 0.09 (0.60) -- -- 10.16 1996 10.26 0.60 (0.19) (0.60) -- -- 10.07 Investor Shares 2000 $10.36 $ 0.57 $(0.78) $(0.57) $ -- $ -- $ 9.58 1999 10.65 0.52 (0.11) (0.52) (0.18) -- 10.36 1998 10.16 0.55 0.49 (0.55) -- -- 10.65 1997 10.06 0.56 0.10 (0.56) -- -- 10.16 1996 10.26 0.56 (0.20) (0.56) -- -- 10.06 Flex Shares 2000 $10.37 $ 0.52 $(0.78) $(0.52) $ -- $ -- $ 9.59 1999 10.66 0.47 (0.11) (0.47) (0.18) -- 10.37 1998 10.17 0.51 0.49 (0.51) -- -- 10.66 1997 10.07 0.51 0.10 (0.51) -- -- 10.17 1996 (3) 10.33 0.52 (0.26) (0.52) -- -- 10.07 * Annualized. + Returns are for the period indicated and have not been annualized. Total return figures do not reflect applicable sales loads. (1) Commenced operations on June 1, 1995. All ratios for the period have been annualized. (2) Commenced operations on June 6, 1995. All ratios for the period have been annualized. (3) Commenced operations on June 7, 1995. All ratios for the period have been annualized. (4) Commenced operations on April 1, 2000. All ratios for the period have been annualized.
64 - ------------------------------------------------------------------------------------------------------------------------ RATIO OF RATIO OF NET INVESTMENT RATIO OF RATIO OF EXPENSES TO INCOME TO NET ASSETS EXPENSES TO NET INVESTMENT AVERAGE NET ASSETS AVERAGE NET ASSETS PORTFOLIO TOTAL END OF AVERAGE INCOME TO (EXCLUDING WAIVERS (EXCLUDING WAIVERS TURNOVER RETURN(+) PERIOD(000 NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS) AND REIMBURSEMENTS) RATE ---------- ----------- ------------ ------------------ ------------------- ------------------- --------- (0.48)% $ 93,040 0.67% 4.25% 0.78% 4.14% 88% 3.72 118,609 0.67 3.90 0.77 3.80 72 8.77 93,939 0.66 4.16 0.80 4.02 69 7.22 50,487 0.65 4.48 0.80 4.33 135 3.87 30,790 0.65 4.49 0.88 4.26 63 (0.68)% $ 2,875 0.87% 4.05% 1.36% 3.56% 88% 3.62 3,799 0.87 3.71 1.31 3.27 72 8.46 3,381 0.86 3.98 1.34 3.50 69 7.00 3,226 0.85 4.28 1.31 3.82 135 3.76 4,025 0.85 4.28 1.36 3.77 63 (1.17)% $ 9,791 1.37% 3.54% 1.89% 3.02% 88% 3.13 14,762 1.37 3.21 1.88 2.70 72 8.04 8,160 1.36 3.45 2.01 2.80 69 6.48 3,000 1.35 3.78 2.28 2.85 135 3.27 2,692 1.35 3.79 2.54 2.60 63 (0.90)% $ 81,160 0.67% 4.13% 0.77% 4.03% 19% 3.33 87,452 0.67 3.87 0.78 3.76 12 8.37 62,363 0.66 4.09 0.81 3.94 7 6.79 39,732 0.65 4.31 0.81 4.15 15 3.89 22,950 0.65 4.36 0.89 4.12 60 (1.26)% $ 2,458 0.87% 3.93% 1.40% 3.40% 19% 3.13 3,676 0.87 3.67 1.25 3.29 12 8.26 3,975 0.86 3.89 1.30 3.45 7 6.47 3,511 0.85 4.10 1.33 3.62 15 3.69 3,418 0.85 4.17 1.41 3.61 60 (1.59)% $ 8,827 1.37% 3.43% 1.95% 2.85% 19% 2.63 13,358 1.37 3.19 1.89 2.67 12 7.74 8,264 1.36 3.39 2.02 2.73 7 6.06 4,662 1.35 3.60 2.07 2.88 15 2.25 4,207 1.35 3.66 2.35 2.66 60 (0.13)% $ 3,075 1.40%* 6.57%* 2.83%* 5.14%* --% (10.84) 2,032 1.73 8.94 2.95 7.72 24 5.64 7,230 1.91 5.09 2.22 4.78 95 8.18 24,413 1.87 5.27 1.87 5.27 130 3.91 32,506 1.65 5.49 1.70 5.44 123 7.67 36,891 1.70 5.87 1.75 5.82 138 (1.76)% $ 998,596 0.77% 6.05% 0.84% 5.98% 202% 4.25 1,149,068 0.77 5.25 0.85 5.17 221 10.92 793,488 0.76 5.67 0.86 5.57 109 6.99 633,646 0.75 5.89 0.85 5.79 298 4.02 599,514 0.75 5.81 0.87 5.69 184 (2.17)% $ 22,553 1.17% 5.60% 1.37% 5.40% 202% 3.86 34,913 1.17 4.87 1.36 4.68 221 10.49 33,269 1.14 5.29 1.38 5.05 109 6.66 33,165 1.15 5.48 1.41 5.22 298 3.50 36,155 1.15 5.40 1.44 5.11 184 (2.63)% $ 20,056 1.66% 5.14% 1.99% 4.81% 202% 3.35 26,020 1.66 4.40 2.00 4.06 221 9.99 13,111 1.65 4.76 2.11 4.30 109 6.16 5,763 1.64 5.00 2.20 4.44 298 2.50 4,621 1.64 4.84 2.49 3.99 184 (A) On March 27, 2000, the ESC Strategic Income Fund exchanged all of its asset and certain liabilities for shares of the High Income Fund. The ESC Strategic Income Fund is the accounting survivor in this transaction, and as a result, it basis of accounting for assets and liabilities and its operating results for th periods prior to March 27, 2000 have been carried forward in these financia highlights. Subsequent to the merger, the High Income Fund changed its fisca year end to May 31. Amounts designated as "--" are either $0 or round to $0. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS
65 FINANCIAL HIGHLIGHTS - ----------------------------------------------------------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, (UNLESS OTHERWISE INDICATED) FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS NET ASSET NET REALIZED AND DISTRIBUTIONS VALUE NET UNREALIZED GAINS FROM NET DISTRIBUTIONS NET ASSET BEGINNING INVESTMENT (LOSSES) INVESTMENT FROM REALIZED VALUE END OF PERIOD INCOME ON INVESTMENTS INCOME CAPITAL GAINS OF PERIOD ----------- ----------- ---------------- ------------- ------------- ---------- Investment Grade Tax-Exempt Bond Fund Trust Shares 2000 $11.10 $ 0.43 $(0.29) $(0.43) $(0.14) $10.67 1999 11.40 0.43 0.10 (0.43) (0.40) 11.10 1998 11.22 0.44 0.50 (0.44) (0.32) 11.40 1997 11.10 0.44 0.33 (0.44) (0.21) 11.22 1996 11.28 0.45 0.19 (0.45) (0.37) 11.10 Investor Shares 2000 $11.12 $ 0.39 $(0.30) $(0.39) $(0.14) $10.68 1999 11.41 0.38 0.11 (0.38) (0.40) 11.12 1998 11.24 0.39 0.49 (0.39) (0.32) 11.41 1997 11.12 0.40 0.33 (0.40) (0.21) 11.24 1996 11.30 0.41 0.19 (0.41) (0.37) 11.12 Flex Shares 2000 $11.10 $ 0.34 $(0.29) $(0.34) $(0.14) $10.67 1999 11.40 0.33 0.10 (0.33) (0.40) 11.10 1998 11.23 0.33 0.49 (0.33) (0.32) 11.40 1997 11.11 0.35 0.33 (0.35) (0.21) 11.23 1996(1) 11.30 0.37 0.18 (0.37) (0.37) 11.11 Limited-Term Federal Mortgage Securities Fund Trust Shares 2000 $ 9.94 $ 0.55 $(0.32) $(0.55) $ -- $ 9.62 1999 10.12 0.54 (0.06) (0.54) (0.12) 9.94 1998 10.02 0.58 0.11 (0.58) (0.01) 10.12 1997 9.99 0.58 0.04 (0.58) (0.01) 10.02 1996 10.11 0.62 (0.14) (0.60) -- 9.99 Investor Shares 2000 $ 9.93 $ 0.52 $(0.33) $(0.52) $ -- $ 9.60 1999 10.11 0.51 (0.06) (0.51) (0.12) 9.93 1998 10.00 0.56 0.12 (0.56) (0.01) 10.11 1997 9.97 0.56 0.04 (0.56) (0.01) 10.00 1996 10.11 0.60 (0.14) (0.60) -- 9.97 Flex Shares 2000 $ 9.94 $ 0.49 $(0.32) $(0.49) $ -- $ 9.62 1999 10.12 0.48 (0.06) (0.48) (0.12) 9.94 1998 10.02 0.52 0.11 (0.52) (0.01) 10.12 1997 9.99 0.52 0.04 (0.52) (0.01) 10.02 1996(2) 10.14 0.55 (0.15) (0.55) -- 9.99 Maryland Municipal Bond Fund (A) Trust Shares 2000 $10.06 $ 0.42 $(0.60) $(0.42) $ -- $ 9.46 1999(3) 10.22 0.20 (0.15) (0.20) (0.01) 10.06 For the years ended November 30: 1998 9.95 0.42 0.27 (0.42) -- 10.22 1997 9.76 0.43 0.19 (0.43) -- 9.95 1996(4) 10.00 0.31 (0.24) (0.31) -- 9.76 Flex Shares 2000 $10.08 $ 0.33 $(0.60) $(0.33) $ -- $ 9.48 1999 10.24 0.15 (0.15) (0.15) (0.01) 10.08 For the years ended November 30: 1998 9.96 0.33 0.28 (0.33) -- 10.24 1997 9.76 0.34 0.20 (0.34) -- 9.96 1996(5) 9.53 0.20 0.23 (0.20) -- 9.76 Short-Term Bond Fund Trust Shares 2000 $ 9.91 $ 0.53 $(0.25) $(0.53) $(0.01) $ 9.65 1999 10.05 0.51 (0.10) (0.52) (0.03) 9.91 1998 9.90 0.55 0.16 (0.55) (0.01) 10.05 1997 9.86 0.53 0.07 (0.53) (0.03) 9.90 1996 9.98 0.54 (0.10) (0.54) (0.02) 9.86 Investor Shares 2000 $ 9.93 $ 0.51 $(0.25) $(0.51) $(0.01) $ 9.67 1999 10.07 0.49 (0.10) (0.50) (0.03) 9.93 1998 9.91 0.53 0.17 (0.53) (0.01) 10.07 1997 9.88 0.51 0.06 (0.51) (0.03) 9.91 1996 10.01 0.52 (0.10) (0.53) (0.02) 9.88 Flex Shares 2000 $ 9.93 $ 0.48 $(0.25) $(0.48) $(0.01) $ 9.67 1999 10.07 0.47 (0.11) (0.47) (0.03) 9.93 1998 9.91 0.50 0.17 (0.50) (0.01) 10.07 1997 9.88 0.48 0.06 (0.48) (0.03) 9.91 1996(6) 10.02 0.47 (0.12) (0.47) (0.02) 9.88 +Returns are for the period indicated and have not been annualized. Total return figures do not reflect applicable sales loads. (1)Commenced operations on June 1, 1995. All ratios for the period have been annualized. (2)Commended operations on June 7, 1995. All ratios for the period have been annualized. (3)For the six month period ended May 31, 1999. All ratios for the period have been annualized. (4)Commenced operations on March 1, 1996. All ratios for the period have been annualized. (5)Commenced operations on April 25, 1996. All ratios for the period have been annualized.
66 - ----------------------------------------------------------------------------------------------------------------------- RATIO OF RATIO OF NET INVESTMENT RATIO OF RATIO OF EXPENSES TO INCOME TO NET ASSETS EXPENSES TO NET INVESTMENT AVERAGE NET ASSETS AVERAGE NET ASSETS PORTFOLIO TOTAL END OF AVERAGE INCOME TO (EXCLUDING WAIVERS (EXCLUDING WAIVERS TURNOVER RETURN(+) PERIOD(000 NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS) AND REIMBURSEMENTS) RATE ---------- ----------- ------------ ------------------ ------------------- ------------------- --------- 1.41% $ 117,384 0.77% 3.98% 0.83% 3.92% 226% 4.67 154,123 0.77 3.75 0.87 3.65 224 8.57 146,606 0.76 3.83 0.88 3.71 378 7.13 139,144 0.75 3.96 0.86 3.85 489 5.82 124,507 0.75 4.01 0.89 3.87 514 0.90% $ 19,443 1.17% 3.59% 1.33% 3.43% 226% 4.35 25,195 1.17 3.36 1.32 3.21 224 8.05 28,159 1.16 3.43 1.43 3.16 378 6.69 31,857 1.15 3.56 1.38 3.33 489 5.40 37,427 1.15 3.61 1.42 3.34 514 0.52% $ 14,678 1.65% 3.11% 1.95% 2.81% 226% 3.78 16,518 1.65 2.86 2.03 2.48 224 7.50 8,399 1.64 2.95 2.10 2.49 378 6.19 4,681 1.63 3.08 2.15 2.56 489 4.91 5,536 1.63 3.12 2.25 2.50 514 2.33% $ 125,355 0.67% 5.60% 0.79% 5.48% 384% 4.75 135,256 0.67 5.28 0.77 5.18 379 7.12 137,488 0.66 5.75 0.77 5.64 163 6.43 123,903 0.65 5.81 0.78 5.68 133 4.84 73,370 0.65 6.04 0.84 5.85 83 1.93% $ 1,194 0.92% 5.31% 1.09% 5.14% 384% 4.47 2,214 0.92 5.03 1.52 4.43 379 6.95 2,705 0.91 5.50 1.51 4.90 163 6.17 2,426 0.90 5.55 1.48 4.97 133 4.59 2,512 0.90 5.75 2.25 4.40 83 1.71% $ 1,706 1.27% 4.97% 2.38% 3.86% 384% 4.14 2,119 1.27 4.69 2.42 3.54 379 6.49 1,543 1.26 5.16 2.72 3.70 163 5.80 1,409 1.25 5.20 2.66 3.79 133 4.10 1,349 1.25 5.38 3.59 3.04 83 (1.78)% $ 26,176 0.68% 4.24% 0.80% 4.12% 14% 0.48 29,658 0.70 3.83 1.37 3.16 19 7.03 19,115 0.62 4.11 1.15 3.58 12 6.50 11,461 0.63 4.38 1.16 3.85 5 1.07 5,808 0.71 4.30 1.36 3.65 9 (2.66)% $ 6,212 1.59% 3.34% 1.95% 2.98% 14% 0.05 7,723 1.59 2.94 1.98 2.55 19 6.17 3,246 1.57 3.16 1.96 2.77 12 5.64 561 1.54 3.43 2.00 2.97 5 7.67 113 1.55 3.42 2.20 2.77 9 2.87% $ 180,402 0.67% 5.40% 0.76% 5.31% 70% 4.06 209,904 0.67 5.12 0.77 5.02 108 7.31 120,422 0.66 5.47 0.79 5.34 87 6.30 89,701 0.65 5.37 0.78 5.24 118 4.45 91,156 0.65 5.39 0.81 5.23 163 2.67% $ 1,446 0.87% 5.20% 1.75% 4.32% 70% 3.88 1,825 0.87 4.92 1.59 4.20 108 7.19 1,949 0.86 5.27 1.71 4.42 87 5.97 2,182 0.85 5.16 1.58 4.43 118 4.23 2,700 0.85 5.20 1.72 4.33 163 2.31% $ 2,065 1.22% 4.85% 2.41% 3.66% 70% 3.50 2,341 1.22 4.55 2.33 3.44 108 6.84 2,110 1.21 4.93 2.85 3.29 87 5.62 1,073 1.20 4.82 3.02 3.00 118 3.73 966 1.20 4.77 4.06 1.91 163 (6) Commenced operations on June 20, 1995. All ratios for the period have been annualized. (A) On May 24, 1999, the CrestFund Maryland Municipal Bond Fund exchanged all of its assets and certain liabilities for shares of the Maryland Municipal Bond Fund. The CrestFund Maryland Municipal Bond Fund is the accounting survivor in this transaction, and as a result, its basis of accounting for assets and liabilities and its operating results for the periods prior to May 24, 1999 have been carried forward in these financial highlights. Amounts designated as "--" are either $0 or have been rounded to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 67 FINANCIAL HIGHLIGHTS - ----------------------------------------------------------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS FOR THE PERIODS ENDED MAY 31, (UNLESS OTHERWISE INDICATED) FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS NET ASSET NET REALIZED AND DISTRIBUTIONS VALUE NET UNREALIZED GAINS FROM NET DISTRIBUTIONS NET ASSET BEGINNING INVESTMENT (LOSSES) INVESTMENT FROM REALIZED VALUE END OF PERIOD INCOME ON INVESTMENTS INCOME CAPITAL GAINS OF PERIOD ------------- ----------- --------------- ------------- -------------- ---------- Short-Term U.S. Treasury Securities Fund Trust Shares 2000 $ 9.95 $ 0.46 $(0.10) $(0.46) $ -- $ 9.85 1999 9.97 0.47 (0.02) (0.47) -- 9.95 1998 9.88 0.51 0.10 (0.52) -- 9.97 1997 9.84 0.51 0.04 (0.51) -- 9.88 1996 9.93 0.55 (0.09) (0.55) -- 9.84 Investor Shares 2000 $ 9.95 $ 0.45 $(0.10) $(0.45) $ -- $ 9.85 1999 9.96 0.46 (0.01) (0.46) -- 9.95 1998 9.88 0.49 0.09 (0.50) -- 9.96 1997 9.84 0.50 0.04 (0.50) -- 9.88 1996 9.94 0.54 (0.10) (0.54) -- 9.84 Flex Shares 2000 $ 9.93 $ 0.42 $(0.10) $(0.42) $ -- $ 9.83 1999 9.94 0.44 (0.02) (0.43) -- 9.93 1998 9.85 0.47 0.10 (0.48) -- 9.94 1997 9.82 0.47 0.03 (0.47) -- 9.85 1996(1) 9.96 0.48 (0.14) (0.48) -- 9.82 U.S. Government Securities Fund Trust Shares 2000 $10.28 $ 0.58 $(0.42) $(0.58) $ -- $ 9.86 1999 10.46 0.59 (0.18) (0.59) -- 10.28 1998 10.02 0.61 0.44 (0.61) -- 10.46 1997 9.91 0.62 0.11 (0.62) -- 10.02 1996 10.27 0.62 (0.33) (0.62) (0.03) 9.91 Investor Shares 2000 $10.28 $ 0.54 $(0.42) $(0.54) $ -- $ 9.86 1999 10.45 0.54 (0.17) (0.54) -- 10.28 1998 10.02 0.57 0.43 (0.57) -- 10.45 1997 9.90 0.58 0.12 (0.58) -- 10.02 1996 10.26 0.59 (0.33) (0.59) (0.03) 9.90 Flex Shares 2000 $10.28 $ 0.49 $(0.42) $(0.49) $ -- $ 9.86 1999 10.46 0.49 (0.18) (0.49) -- 10.28 1998 10.02 0.52 0.44 (0.52) -- 10.46 1997 9.91 0.53 0.11 (0.53) -- 10.02 1996(2) 10.31 0.52 (0.37) (0.52) (0.03) 9.91 Virginia Intermediate Municipal Bond Fund (A) Trust Shares 2000 $10.20 $ 0.43 $(0.57) $(0.43) $(0.05) $ 9.58 1999(3) 10.44 0.21 (0.17) (0.21) (0.07) 10.20 For years ended November 30: 1998 10.31 0.45 0.17 (0.45) (0.04) 10.44 1997 10.22 0.46 0.09 (0.46) -- 10.31 1996 10.24 0.42 (0.02) (0.42) -- 10.22 1995 9.21 0.43 1.03 (0.43) -- 10.24 Investor Shares 2000 $10.20 $ 0.42 $(0.56) $(0.42) $(0.05) $ 9.59 1999(3) 10.45 0.22 (0.18) (0.22) (0.07) 10.20 For years ended November 30: 1998 10.31 0.46 0.17 (0.45) (0.04) 10.45 1997 10.21 0.47 0.09 (0.46) -- 10.31 1996 10.23 0.42 (0.02) (0.42) -- 10.21 1995 9.20 0.43 1.03 (0.43) -- 10.23 Virginia Municipal Bond Fund (A) Trust Shares 2000 $10.43 $ 0.45 $(0.78) $(0.45) $(0.01) $ 9.64 1999(3) 10.68 0.22 (0.19) (0.22) (0.06) 10.43 For years ended November 30: 1998 10.44 0.47 0.27 (0.47) (0.03) 10.68 1997 10.28 0.48 0.17 (0.48) (0.01) 10.44 1996 10.40 0.47 (0.12) (0.47) -- 10.28 1995(4) 10.00 0.31 0.44 (0.31) (0.04) 10.40 Flex Shares 2000 $10.48 $ 0.36 $(0.79) $(0.36) $(0.01) $ 9.68 1999(3) 10.73 0.17 (0.18) (0.18) (0.06) 10.48 For years ended November 30: 1998 10.48 0.37 0.28 (0.37) (0.03) 10.73 1997 10.31 0.39 0.18 (0.39) (0.01) 10.48 1996 10.43 0.38 (0.12) (0.38) -- 10.31 1995(5) 10.06 0.24 0.41 (0.24) (0.04) 10.43 + Returns are for the period indicated and have not been annualized. Total return figures do not reflect applicable sales loads. (1) Commenced operations on June 22, 1995. All ratios for the period have been annualized. (2) Commenced operations on June 7, 1995. All ratios for the period have been annualized. (3) For the six month period ended May 31, 1999. All ratios for the period have been annualized. (4) Commenced operations on April 5, 1995. All ratios for the period have been annualized. (5) Commenced operations on April 17, 1995. All ratios for the period have been annualized. 68 - ----------------------------------------------------------------------------------------------------------------------------------- RATIO OF RATIO OF NET INVESTMENT RATIO OF RATIO OF EXPENSES TO INCOME TO NET ASSETS EXPENSES TO NET INVESTMENT AVERAGE NET ASSETS AVERAGE NET ASSETS PORTFOLIO TOTAL END OF AVERAGE INCOME TO (EXCLUDING WAIVERS (EXCLUDING WAIVERS TURNOVER RETURN(+) PERIOD(000 NET ASSETS AVERAGE NET ASSETS AND REIMBURSEMENTS) AND REIMBURSEMENTS) RATE ---------- ---------- ----------- ------------------ --------------------- ------------------- ---------- 3.75% $ 72,570 0.67% 4.70% 0.79% 4.58% 50% 4.59 56,027 0.67 4.69 0.78 4.58 57 6.30 46,920 0.66 5.19 0.84 5.01 39 5.76 21,988 0.65 5.23 0.92 4.96 93 4.73 10,149 0.65 5.56 1.00 5.21 94 3.58%$ 2,066 0.82% 4.50% 1.44% 3.88% 50% 4.54 2,799 0.82 4.54 1.34 4.02 57 6.04 3,277 0.81 5.07 1.33 4.55 39 5.59 3,921 0.80 5.05 1.35 4.50 93 4.52 4,192 0.80 5.43 1.32 4.91 94 3.34%$ 5,391 1.07% 4.26% 2.04% 3.29% 50% 4.32 4,931 1.07 4.22 2.25 3.04 57 5.90 1,413 1.06 4.81 2.87 3.00 39 5.19 1,091 1.05 4.75 2.51 3.29 93 3.72 2,423 1.05 5.03 2.97 3.11 94 1.63%$ 85,420 0.77% 5.77% 0.84% 5.70% 29% 3.90 102,167 0.77 5.58 0.88 5.47 19 10.76 34,899 0.76 5.93 0.92 5.77 14 7.54 19,471 0.75 6.19 1.02 5.92 21 2.77 10,277 0.75 6.05 1.25 5.55 83 1.19%$ 1,407 1.17% 5.34% 2.14% 4.37% 29% 3.56 2,534 1.17 5.17 1.60 4.74 19 10.23 3,225 1.16 5.53 1.76 4.93 14 7.21 2,243 1.15 5.76 1.79 5.12 21 2.47 2,396 1.15 5.68 2.50 4.33 83 0.70%$ 7,750 1.68% 4.85% 2.28% 4.25% 29% 2.99 11,520 1.68 4.66 2.08 4.26 19 9.78 4,022 1.67 5.02 2.32 4.37 14 6.57 2,801 1.66 5.26 2.42 4.50 21 1.42 2,826 1.66 5.18 2.86 3.98 83 (1.31)%$202,209 0.76% 4.35% 0.76% 4.35% 18% 0.42 240,083 0.84 4.12 1.18 3.78 19 6.10 243,606 0.79 4.33 0.97 4.15 24 5.55 237,096 0.78 4.57 0.93 4.42 30 4.01 243,137 0.78 4.35 0.93 4.20 25 16.09 43,373 0.72 4.34 0.94 4.12 28 (1.24)%$ 6,808 0.79% 4.33% 0.94% 4.18% 18% 0.35 7,706 0.79 4.17 0.93 4.03 19 6.19 7,899 0.79 4.33 0.94 4.18 24 5.65 7,826 0.79 4.56 0.94 4.41 30 4.01 8,185 0.79 4.12 0.94 3.97 25 16.10 8,649 0.73 4.33 0.95 4.11 28 (3.18)%$ 48,980 0.74% 4.53% 0.79% 4.48% 19% 0.27 31,939 0.76 4.20 1.30 3.66 7 7.19 29,252 0.69 4.41 1.10 4.00 28 6.46 20,044 0.69 4.65 1.09 4.25 39 3.48 15,911 0.71 4.61 1.11 4.21 24 7.67 6,247 0.71 4.61 1.11 4.21 35 (4.13)%$ 5,367 1.65% 3.61% 2.08% 3.18% 19% (0.16) 6,939 1.65 3.32 1.91 3.06 7 6.24 3,697 1.64 3.46 1.92 3.18 28 5.58 1,476 1.60 3.73 2.00 3.33 39 2.58 787 1.57 3.73 1.97 3.33 24 6.51 628 1.57 3.76 1.97 3.36 35 (A) On May 24, 1999, the CrestFund Virginia Intermediate Municipal Bond and the CrestFund Virginia Municipal Bond Funds exchanged all of their assets and certain liabilities for shares of the Virginia Intermediate Municipal Bond and the Virginia Municipal Bond Funds, respectively. The CrestFund Virginia Intermediate Municipal Bond and the CrestFund Virginia Municipal Bond Funds are the accounting survivors in this transaction, and as a result, their basis of accounting for assets and liabilities and their operating results for the periods prior to May 24, 1999 have been carried forward in these financial highlights. Amounts designated as "--" are either $0 or have been rounded to $0.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 69 NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 1. Organization: The STI Classic Funds (the "Trust") was organized as a Massachusetts business trust under a Declaration of Trust dated January 15, 1992. The Trust is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company with thirty-five funds as of May 31, 2000: the Balanced Fund, the Capital Appreciation Fund (formerly Capital Growth Fund), the Core Equity Fund, the E-Commerce Opportunity Fund, the Growth and Income Fund, the International Equity Fund, the International Equity Index Fund, the Life Vision Moderate Growth Fund (formerly Life Vision Balanced Portfolio), the Life Vision Growth and Income Fund (formerly Life Vision Growth and Income Portfolio), the Life Vision Aggressive Growth Fund (formerly Life Vision Maximum Growth Portfolio), the Mid-Cap Equity Fund, the Small Cap Value Equity Fund, the Small Cap Growth Stock Fund, the Tax Sensitive Growth Stock Fund, the Value Income Stock Fund, (collectively the "Equity Funds"), the Florida Tax-Exempt Bond Fund, the Georgia Tax-Exempt Bond Fund, the High Income Fund, the Investment Grade Bond Fund, the Investment Grade Tax-Exempt Bond Fund, the Limited-Term Federal Mortgage Securities Fund, the Maryland Municipal Bond Fund, the Short-Term Bond Fund, the Short-Term U.S. Treasury Securities Fund, the U.S. Government Securities Fund, the Virginia Intermediate Municipal Bond Fund, and the Virginia Municipal Bond Fund, (collectively the "Fixed Income Funds" or the "Funds"), the Prime Quality Money Market Fund, the Tax-Exempt Money Market Fund, the Tax-Free Money Market Fund, the U.S. Government Securities Money Market Fund, the U.S. Treasury Money Market Fund (collectively the "Retail Money Market Funds"), the Classic Institutional Cash Management Money Market Fund, the Classic Institutional U.S. Government Securities Money Market Fund and the Classic Institutional U.S. Treasury Securities Money Market Fund, (collectively the "Institutional Money Market Funds"). The assets of each Fund are segregated, and a shareholder's interest is limited to the fund in which shares are held. Each Fund's prospectus provides a description of the Fund's investment objectives, policies and strategies. The financial statements presented herein are those of the Fixed Income Funds. The financial statements of the Equity Funds, the Retail Money Market Funds and the Institutional Money Market Funds are not presented herein, but are presented separately. During February 1999, the Board of Trustees of the STI Classic Funds Inc. and Board of Directors of the CrestFunds Inc. ("CrestFunds") approved an Agreement and Plan of Reorganization (the "Reorganization Agreement") providing for the transfer of all assets and certain stated liabilities of the CrestFunds in exchange for the issuance of shares in the Funds in a tax-free reorganization (see Note 9). On February 15, 2000 and December 9, 1999, respectively, theBoard ofTrustees of the STIClassic Funds Inc. and Board of Directors of the ESCStrategic Funds Inc. approved an Agreement and Plan of Reorganization (the "Reorganization Agreement") providing for the transfer of all assets and liabilities of the ESCStrategic Income Fund in exchange for the issuance of shares in the STIClassic High Income Fund in a tax-free reorganization that took place at the close of business on March 27, 2000. The STI Classic High Income Fund had not commenced operations prior to this merger. Subsequent to March, 31, 2000, the High Income Fund's fiscal year end was changed to May 31, in order to be consistent with the year end of each of the other STI Classic Funds. 2. Significant Accounting Policies: The following is a summary of significant accounting policies followed by the Trust: BASIS OF PRESENTATION OF STATEMENTS -- As more fully described in Note 9, the STI Classic Funds acquired certain CrestFunds in a tax-free business combination. While each Fund now exists as a STI Classic Fund, three of the surviving funds for accounting purposes are CrestFunds. In accordance with generally accepted accounting principles, the financial statements presented herein represent those of accounting survivors. Accordingly, the Statements of Changes in Net Assets and Financial Highlights presented for periods prior to and ending on May 31, 1999 reflect activity beginning on the first day of the accounting survivor's fiscal year. As more fully described above, the STI Classic High Income Fund acquired the ESCStrategic Income Fund in a tax-free business combination. While this Fund now exists as a STIClassic Fund, the surviving fund for accounting purposes is the ESCStrategic Income Fund. In accordance with generally accepted accounting principles, the financial statements presented herein represent those of the accounting survivor. Accordingly, the Statements of Changes in Net Assets and Financial Highlights presented for the periods prior to and ending on May 31, 2000 reflect activity beginning on the first day of the accounting survivor's fiscal year. SECURITY VALUATION -- Investment securities held by the Funds that are listed on a securities exchange for which market quotations are available are valued at the last quoted sales price each business day. If there is no such reported sale, these securities and unlisted securities for which market quotations are readily available are valued at the most recently quoted bid price. Debt obligations with sixty days 70 - ------------------------------------------------------------------------------- or less remaining until maturity may be valued at their amortized cost. Securities for which current market quotations are not readily available are valued at their fair value as determined in good faith by, or in accordance with procedures adopted by, the Board of Trustees. FEDERAL INCOME TAXES -- It is each Fund's intention to qualify as a regulated investment company for Federal income tax purposes and distribute all of its taxable income and net capital gains. Accordingly, no provisions for Federal income taxes are required. SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are accounted for on the date the security is purchased or sold (trade date). Interest income is recognized on an accrual basis. Costs used in determining net realized gains and losses on the sales of investment securities are those of the specific securities sold adjusted for the accretion and amortization of purchase discounts and premiums during the respective holding period. Purchase discounts and premiums on securities held by the Funds are accreted and amortized to maturity using the scientific interest method, which approximates the effective interest method. REPURCHASE AGREEMENTS -- Securities pledged as collateral for repurchase agreements are held by the custodian bank until the respective agreements mature. Provisions of the repurchase agreements ensure that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default of the counterparty. If the counterparty defaults and the value of the collateral declines or if the counterparty enters into an insolvency proceeding, realization of the collateral by the funds may be delayed or limited. NET ASSET VALUE PER SHARE -- The net asset value per share of each fund is calculated each business day, by dividing the total value of each fund's assets, less liabilities, by the number of shares outstanding. The maximum offering price per share for Investor shares of the Florida Tax-Exempt Bond, the Georgia Tax-Exempt Bond, the Investment Grade Bond, the Investment Grade Tax-Exempt Bond, the U.S. Government Securities, and the Virginia Intermediate Municipal Bond Funds is equal to the net asset value per share plus a sales load of 3.75%. The maximum offering price per share for Investor shares of the Short-Term U.S. Treasury Securities Fund is equal to the net asset value per share plus a sales load of 1.00%. The maximum offering price per share for Investor shares of the Short-Term Bond Fund is equal to the net asset value per share plus a sales load of 2.00%. The maximum offering price per share for Investor shares of the Limited-Term Federal Mortgage Securities Fund is equal to the net asset value per share plus a sales load of 2.50%. Flex Shares of the Funds may be purchased at their net asset value. Shares redeemed within the first year after purchase will be subject to a contingent deferred sales charge ("CDSC") equal to 2.00% for either the net asset value of the shares at the time of purchase or the net asset value of the shares next calculated after the Fund receives the sale request, whichever is less. The CDSC will not apply to shares redeemed after such time. TBA PURCHASE COMMITMENTS -- The Funds may enter into "TBA" (To Be Announced) purchase commitments to purchase securities for a fixed price at a future date beyond customary settlement time. TBA purchase commitments may be considered securities in themselves, and involve a risk of loss if the value of the security to be purchased declines prior to settlement date, which risk is in addition to the risk of decline in the value of the funds' other assets. Unsettled TBA purchase commitments are valued at the current market value of the underlying securities, generally according to the procedures described under "Security Valuation." OTHER -- Expenses that are directly related to a specific fund are charged to that Fund. Class specific expenses are borne by that class. Other operating expenses of the Trust are pro-rated to the Funds on the basis of relative net assets. Fund expenses are pro-rated to the respective classes on the basis of relative net assets. DISTRIBUTIONS TO SHAREHOLDERS -- Distributions from net investment income for each of the Fixed Income Funds are declared daily and paid monthly. Any net realized capital gains on sales of securities are distributed to shareholders at least annually. RECLASSIFICATION OF COMPONENTS OF NET ASSETS -- The timing and characterization of certain income and capital gains distributions are determined annually in accordance with federal tax regulations which may differ from generally accepted accounting principles.As a result, net investment income (loss) and net realized gain (loss) on investment transactions for a reporting period may differ significantly from distributions during such period. These book/tax differences may be temporary or permanent in nature. To the extent these differences are permanent, they are charged or credited to paid-in-capital or accumulated net realized gain, as appropriate, in the period that the differences arise. Accordingly, the following permanent differences, primarily attributable to the classification of short-term capital 71 NOTES TO FINANCIAL STATEMENTS (continued) - ------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 gains and ordinary income for tax purposes related to the other funds, has been reclassified to/from the following accounts: ACCUMULATED UNDISTRIBUTED PAID-IN REALIZED NET INVESTMENT CAPITAL GAIN (LOSS) INCOME (LOSS) (000) (000) (000) ------- ----------- --------------- Georgia Tax-Exempt Bond Fund $-- $ 1 $(1) Investment Grade Tax-Exempt Bond Fund 8 (6) (2) Maryland Municipal Bond Fund (3) -- 3 Short-Term Bond Fund -- 2 (2) Short-Term U.S. Treasury Securities Fund -- (32) 32 These reclassifications have no effect on net assets or net asset values per share. USE OF ESTIMATES -- The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that effect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from these estimates. 3. Transactions with Affiliates: Certain officers of the Trust are also officers of SEI Investments Mutual Funds Services (the "Administrator") and/or SEI Investments Distribution Co. (the "Distributor"). Such officers are paid no fees by the Trust for serving as officers of the Trust. The Fund has entered into an agreement with the Distributor to manage the investments of repurchase agreements for the Funds. For its services the Distributor received $1,846,277 for the year ended May 31, 2000. 4. Administration, Transfer Agency Servicing and Distribution Agreements: The Trust and the Administrator are parties to an Administration Agreement dated May 29, 1995, as amended November 19, 1997 and March 1, 1999, under which the Administrator provides administrative services for an annual fee (expressed as a percentage of the combined average daily net assets of the Trust and STI Classic Variable Trust) of: .12% up to $1 billion, .09% on the next $4 billion, .07% on the next $3 billion, .065% on the next $2 billion and .06% for over $10 billion. Prior to May 1999, administrative and accounting services were provided to the CrestFunds by SEI Investments Mutual Funds Services who was entitled to receive a fee at an annual rate of .15% of the average daily net assets of the CrestFunds. The Administrator had voluntarily agreed to waive a portion of its fee for Government Bond Fund and Virginia Municipal Bond Fund in order to limit operating expenses. Prior to March 27, 2000, administrative and accounting services were provided to the ESC Strategic Income Fund by BISYS Fund Services Limited Partnership who was entitled to receive a fee at an annual rate of .15% of the average daily net assets of the ESC Strategic Income Fund. The Trust and Federated Services Company are parties to a Transfer Agency servicing agreement dated May 14, 1994 under which Federated Services Company provides transfer agency services to the Trust. Prior to March 27, 2000, transfer and dividend disbursing agent services were provided to the ESC Strategic Income Fund by BISYS Fund Services Inc. for which it received a fee of $15 per account per year subject to a minimum fee of $15,000. The Trust and the Distributor are parties to a Distribution Agreement dated May 29, 1995 regarding the Flex Shares and a Distribution Agreement dated November 21, 1995 with respect to the Trust and Investor shares. The Distributor will receive no fees for its distribution services under this agreement for the Trust Shares of any fund. With respect to the Investor Shares and Flex Shares, the Distributor receives amounts, pursuant to a Distribution Plan and (in the case of Flex Shares) a Distribution and Service Plan, as outlined in the table in footnote 5 under the column titled "Distribution Fee". Prior to May 1999, the Distributor, a wholly owned subsidiary of SEI Investments Co., served as distributor of each of the CrestFunds shares pursuant to an agreement with the CrestFunds. The Trust Class and Investors Class A shares of the CrestFunds had a separate distribution plan (the 12b-1 Plan) pursuant to Rule 12b-1 under the 1940 Act. As provided in the 12b-1 Plan, the Trust Class and Investors Class A shares of the CrestFunds paid the Distributor as compensation for its services .15% of the aggregate average daily net assets of such classes of the CrestFunds. The Distributor had voluntarily agreed to waive any fees payable pursuant to the 12b-1 Plan. Additionally, the Investors Class B Shares of the CrestFunds had a distribution plan (the B Shares Plan) pursuant to Rule 12b-1 under the 1940 Act. As provided in the B Shares Plan, the Investors Class B Shares of the CrestFunds paid the Distributor as compensation for its services .75% of the aggregate average daily net assets of such class of the CrestFunds. In addition, pursuant to the B Shares Plan, the Distributor was compensated at an annual rate of .25% of the B shares' average net assets for providing ongoing shareholder support services to investors in B shares. The Distributor had agreed to waive the portion of its fees pursuant to the B Shares Plan in order to limit distribution fees to .95% for each of the CrestFunds. 72 - ------------------------------------------------------------------------------- Prior to May 1999, the CrestFunds had adopted a shareholder service plan (the "Plan") for Trust Class Shares of the Limited Term Bond Fund, Intermediate Bond Fund, Government Bond Fund, Maryland Municipal Bond Fund, Virginia Intermediate Municipal Bond Fund and Virginia Municipal Bond Fund. Under the Plan, the CrestFunds paid the Distributor a negotiated fee at a rate of up to .25% annually of the average daily net assets of such Fund attributable to the shares that are subject to the arrangement in return for provision of a broad range of shareholder and administrative services. The Distributor had agreed to waive a portion of its shareholder service plan for trust class shares in order to limit shareholder service fees to .05%. Prior to March 27, 2000, BISYS Fund Services served as distributor pursuant to an agreement with the ESC Strategic Income Fund. 5. Investment Advisory and Custodian Agreements: The Trust, Trusco Capital Management ("Trusco") and the SunTrust Bank, Atlanta have entered into advisory agreements dated May 29, 1992, June 15, 1993, and December 20, 1993 respectively. Under terms of the respective agreements, the Funds are charged the following annual fees based upon average daily net assets: MAXIMUM FLEX SHARE MAXIMUM DISTRI- MAXIMUM TRUST INVESTOR INVESTOR BUTION FLEX ANNUAL SHARE SHARE SHARE AND SHARE ADVISORY MAXIMUM DISTRI- MAXIMUM SERVICE MAXIMUM FEE EXPENSE BUTION FEE EXPENSE FEE EXPENSE ------ ------ ------ ------- ----------- -------- Trusco: Florida Tax-Exempt Bond Fund .65% .67% .18% .87% 1.00% 1.37% Georgia Tax-Exempt Bond Fund .65% .67% .18% .87% 1.00% 1.37% HighIncome Fund .80% -- -- -- 1.00% 1.40% Investment Grade Bond Fund .74% .77% .43% 1.17% 1.00% 1.66% Investment Grade Tax-Exempt Bond Fund .74% .77% .43% 1.17% 1.00% 1.65% Limited-Term Federal Mortgage Securities Fund .65% .67% .23% .92% 1.00% 1.27% Maryland Municipal Bond Fund .65% .68% -- -- 1.00% 1.59% Short-Term Bond Fund .65% .67% .23% .87% 1.00% 1.22% Short-Term U.S. Treasury Securities Fund .65% .67% .18% .82% 1.00% 1.07% U.S. Government Securities Fund .74% .77% .38% 1.17% 1.00% 1.68% Virginia Intermediate Municipal Bond Fund .65% .76% .15% .79% -- -- Virginia Municipal Bond Fund .65% .74% -- -- 1.00% 1.65% The investment advisers and the Distributor have voluntarily agreed to waive all or a portion of their fees (and to reimburse funds' expenses) in order to limit operating expenses to an amount as outlined in the table above. Fee waivers and expense reimbursements are voluntary and may be terminated at any time. Prior to May 1999, Crestar Asset Management Company ("CAMCO") provided Investment Advisory services to the CrestFunds. CAMCO was paid for advisory services at an annual rate of .50% of average daily net assets for the Limited Term Bond Fund and Virginia Intermediate Municipal Bond Fund, and .60% of average daily net assets for the Intermediate Bond Fund, Government Bond Fund, Maryland Municipal Bond Fund and Virginia Municipal Bond Fund. Prior to March 27, 2000 SunTrust Equitable Securities Corporation ("STES") provided investment advisory services to the ESC Strategic Income Fund. STES was paid for advisory services at an annual rate of 1.00% of average daily net assets of the Fund, and agreed to waive and reimburse their fee in order to limit operating expenses to a maximum of 2.00% of average daily net assets of the Class A shares, and 2.50% of the Class D shares. SunTrust Bank, Atlanta, an affiliate of the investment adviser, acts as custodian for all of the funds. Fees of the Custodian are paid on the basis of net assets of the Funds. The Custodian plays no role in determining the investment policies of the Trust or which securities are to be purchased or sold in the funds. 73 NOTES TO FINANCIAL STATEMENTS (continued) - ----------------------------------------------------------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 6. Capital Share Transactions: Capital Share Transactions for the funds were as follows: (000) FLORIDA TAX-EXEMPT GEORGIA TAX-EXEMPT BOND FUND BOND FUND HIGH INCOME FUND -------------------- ------------------------ ------------------------------- 06/01/99- 06/01/98- 06/01/99- 06/01/98- 04/01/00- 04/01/99 04/01/98- 05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 03/31/00 03/31/99 -------- ---------- ----------- --------- --------- -------- --------- Trust Shares: Shares Issued 2,797 4,807 2,757 3,562 -- -- -- Shares Issued in Connection with Crestar Merger -- -- -- -- -- -- Shares Issued in Lieu of Cash Distributions 87 154 140 116 -- -- -- Shares Redeemed (4,835) (2,530) (3,069) (1,128) -- -- -- ------ ----- ----- ----- --- ---- ------ Net Trust Share Transactions (1,951) 2,431 (172) 2,550 -- -- -- ------ ----- ----- ----- --- ---- ------ Investor Shares: Shares Issued 16 102 58 117 -- -- -- Shares Issued in Connection with Crestar Merger -- -- -- -- -- -- Shares Issued in Lieu of Cash Distributions 12 13 11 12 -- -- -- Shares Redeemed (101) (72) (177) (155) -- -- -- ------ ----- ----- ----- --- ---- ------ Net Investor Share Transactions (73) 43 (108) (26) -- -- -- ------ ----- ----- ----- --- ---- ------ Flex Shares: Shares Issued 287 1,102 196 586 147 99 94 Shares Issued in Connection with ESC Merger -- -- -- -- -- 44 -- Shares Issued in Lieu of Cash Distributions 42 40 42 30 2 50 90 Shares Redeemed (748) (512) (641) (102) (14) (678) (1,888) ------ ----- ----- ----- --- ---- ------ Net Flex Share Transactions (419) 630 (403) 514 135 (485) (1,704) ------ ----- ----- ----- --- ---- ------ Class D: Shares Issued -- -- -- -- -- 5 16 Shares Issued in Connection with Merger -- -- -- -- -- (44) -- Shares Issued in Lieu of Cash Distributions -- -- -- -- -- 4 4 Shares Redeemed -- -- -- -- -- (21) (46) ------ ----- ----- ----- --- ---- ------ Net Class D Transactions -- -- -- -- -- (56) (26) ------ ----- ----- ----- --- ---- ------ Net Change in Capital Shares (2,443) 3,104 (683) 3,038 135 (541) (1,730) ====== ===== ==== ===== === ==== ====== SHORT-TERM SHORT-TERM U.S. TREASURY BOND FUND SECURITIES FUND ---------------------------- ------------------------- 06/01/99- 06/01/98- 06/01/99- 06/01/98- 05/31/00 05/31/99 05/31/00 05/31/99 ---------- --------- --------- --------- Trust Shares: Shares Issued 5,302 5,746 3,158 1,750 Shares Issued in Connection with Crestar Merger -- 7,308 -- -- Shares Issued in Lieu of Cash Distributions 478 357 145 95 Shares Redeemed (8,249) (4,219) (1,567) (921) ------ ------ ------ ----- Net Trust Share Transactions (2,469) 9,192 1,736 924 ------ ------ ------ ----- Investor Shares: Shares Issued 41 58 75 138 Shares Issued in Lieu of Cash Distributions 9 9 13 13 Shares Redeemed (84) (77) (159) (198) ------ ------ ------ ----- Net Investor Share Transactions (34) (10) (71) (47) ------ ------ ------ ----- Flex Shares: Shares Issued 119 251 341 531 Shares Issued in Connection with Crestar Merger -- -- -- -- Shares Issued in Lieu of Cash Distributions 11 10 22 9 Shares Redeemed (152) (235) (311) (185) ------ ------ ------ ----- Net Flex Share Transactions (22) 26 52 355 ------ ------ ------ ----- Net Change in Capital Shares (2,525) 9,208 1,717 1,232 ====== ====== ====== =====
74 - ----------------------------------------------------------------------------------------------------------------------------------- INVESTMENT GRADE INVESTMENT GRADE TAX- LIMITED-TERM FEDERAL MARYLAND MUNICIPAL BOND FUND EXEMPT BOND FUND MORTGAGE SECURITIES FUND BOND FUND -------------------- ----------------------- ------------------------ ------------------------------ 06/01/99- 06/01/98- 06/01/99- 06/01/98- 06/01/99- 06/01/98- 06/01/99- 12/01/98- 12/01/97 05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 05/31/99 05/31/00 05/31/99 11/30/98 --------- --------- --------- ---------- --------- --------- --------- --------- -------- 25,331 28,937 2,710 5,150 5,423 5,379 1,921 1,556 1,292 -- 30,233 -- -- -- -- -- -- -- 3,675 3,979 254 479 492 620 21 2 1 (35,746) (26,711) (5,846) (4,614) (6,485) (5,979) (2,122) (479) (575 ------- ------- ------ ------ ------ ------ ------ ------ ------ (6,740) 36,438 (2,882) 1,015 (570) 20 (180) 1,079 718 ------- ------- ------ ------ ------ ------ ------ ------ ------ 331 758 63 190 31 84 -- -- -- -- 229 -- -- -- -- -- -- -- 167 191 91 143 10 15 -- -- -- (1,516) (931) (600) (535) (140) (144) -- -- -- ------- ------- ------ ------ ------ ------ ------ ------ ------ (1,018) 247 (446) (202) (99) (45) -- -- -- ------- ------- ------ ------ ------ ------ ------ ------ ------ 958 1,821 650 936 81 107 237 464 274 -- -- -- -- -- -- -- -- 123 93 62 49 10 10 23 7 4 (1,500) (634) (825) (234) (127) (56) (370) (22) (17) ------- ------- ------ ------ ------ ------ ------ ------ ------ (419) 1,280 (113) 751 (36) 61 (110) 449 261 ------- ------- ------ ------ ------ ------ ------ ------ ------ -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- ------- ------- ------ ------ ------ ------ ------ ------ ------ -- -- -- -- -- -- -- -- -- ------- ------- ------ ------ ------ ------ ------ ------ ------ (8,177) 37,965 (3,441) 1,564 (705) 36 (290) 1,528 979 ======= ======= ====== ====== ====== ====== ====== ====== ====== U. S. GOVERNMENT SECURITIES FUND VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND VIRGINIA MUNICIPAL BOND FUND --------------------- -------------------------------------------- ----------------------------- 06/01/99- 06/01/98- 06/01/99- 12/01/98- 12/01/97- 06/01/99- 12/01/98- 12/01/97- 05/31/00 05/31/99 05/31/00 05/31/99 11/30/98 05/31/00 05/31/99 11/30/98 --------- ---------- ---------- --------- ---------- --------- --------- --------- 2,790 2,197 2,693 2,543 3,557 3,311 688 1,302 -- 5,439 -- -- -- -- -- -- 127 49 98 4 61 26 3 6 (4,192) (1,087) (5,235) (2,327) (3,293) (1,318) (368) (488) ------ ------ ------ ------ ------ ------ ---- ----- (1,275) 6,598 (2,444) 220 325 2,019 323 820 ------ ------ ------ ------ ------ ------ ---- ----- 41 91 147 62 210 -- -- -- 11 15 29 16 28 -- -- -- (156) (167) (221) (79) (241) -- -- -- ------ ------ ------ ------ ------ ------ ---- ----- (104) (61) (45) (1) (3) -- -- -- ------ ------ ------ ------ ------ ------ ---- ----- 238 564 -- -- -- 161 359 233 -- 308 -- -- -- -- -- -- 44 19 -- -- -- 15 7 6 (616) (156) -- -- -- (284) (49) (35) ------ ------ ------ ------ ------ ------ ---- ----- (334) 735 -- -- -- (108) 317 204 ------ ------ ------ ------ ------ ------ ---- ----- (1,713) 7,272 (2,489) 219 322 1,911 640 1,024 ====== ===== ====== ====== ====== ====== ==== =====
75 NOTES TO FINANCIAL STATEMENTS (concluded) - ------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 7. Investment Transactions: The cost of purchases and the proceeds from sales of securities, excluding short-term investments and U.S. Government Securities, for the period ended May 31, 2000, were as follows: PURCHASES SALES (000) (000) -------------------- Florida Tax-Exempt Bond Fund $ 98,307 $124,813 Georgia Tax-Exempt Bond Fund 17,157 23,587 High Income Fund 944 -- Investment Grade Bond Fund 1,048,744 931,682 Investment Grade Tax-Exempt Bond Fund 340,143 375,260 Limited-Term Federal Mortgage Securities Fund -- -- Maryland Municipal Bond Fund 9,607 3,570 Short-Term Bond Fund 92,425 58,221 Short-Term U.S. Treasury Securities Fund -- -- U.S. Government Securities Fund -- 29 Virginia Intermediate Municipal Bond Fund 38,212 76,328 Virginia Municipal Bond Fund 24,485 9,157 The cost of purchases and proceeds from sales of U.S. Government securities were: PURCHASES SALES (000) (000) -------------------- Florida Tax-Exempt Bond Fund $ -- $ -- Georgia Tax-Exempt Bond Fund -- -- High Income Fund -- -- Investment Grade Bond Fund 1,143,261 1,417,469 Investment Grade Tax-Exempt Bond Fund -- -- Limited-Term Federal Mortgage Securities Fund 507,100 531,796 Maryland Municipal Bond Fund -- -- Short-Term Bond Fund 35,838 84,195 Short-Term U.S. Treasury Securities Fund 32,856 23,767 U.S. Government Securities Fund 29,378 41,373 Virginia Intermediate Municipal Bond Fund -- -- Virginia Municipal Bond Fund -- -- At May 31, 2000, the total cost of securities and the net realized gains or losses on securities sold for Federal income tax purposes were not materially different from amounts reported for financial reporting purposes. The aggregate gross unrealized appreciation and depreciation for securities held by the funds at May 31, 2000, were as follows: AGGREGATE AGGREGATE NET GROSS GROSS UNREALIZED UNREALIZED UNREALIZED APPRECIATION/ APPRECIATION DEPRECIATION (DEPRECIATION) (000) (000) (000) ------------------------- -------------- Florida Tax-Exempt Bond Fund $ 257 $(2,723) $ (2,466) Georgia Tax-Exempt Bond Fund 93 (3,335) (3,242) High Income Fund -- (162) (162) Investment Grade Bond Fund 5,160 (62,099) (56,939) Investment Grade Tax-Exempt Bond Fund 602 (1,468) (866) Limited-Term Federal Mortgage Securities Fund 31 (2,637) (2,606) Maryland Municipal Bond Fund 40 (1,776) (1,736) Short-Term Bond Fund 24 (4,793) (4,769) Short-Term U.S. Treasury Securities Fund 9 (837) (828) U.S. Government Securities Fund 104 (4,045) (3,941) Virginia Intermediate Municipal Bond Fund 1,289 (7,671) (6,382) Virginia Municipal Bond Fund 108 (2,359) (2,251) Subsequent to October 31, 1999, the Funds recognized net capital losses for tax purposes that have been deferred to 2000 and can be used to offset future capital gains after May 31, 2000. The Funds also had capital loss carryforwards at May 31, 2000 as follows: POST 10/31 CARRYOVER EXPIRES EXPIRES EXPIRES EXPIRES EXPIRES EXPIRES EXPIRES DEFERRED 5/31/00 2002 2003 2004 2005 2006 2007 2008 LOSS (000) (000) (000 (000) (000) (000 (000) (000) (000) -------- -------- ------- -------- ------- ------- ------- ------- -------- Florida Tax-Exempt Bond Fund $ 1,224 $ -- $ -- $ -- $ -- $ -- $ -- $ 1,224 $1,039 Georgia Tax-Exempt Bond Fund 398 -- -- -- -- -- -- 398 438 High Income Fund 768 -- -- -- -- -- 61 707 -- Investment Grade Bond Fund 14,208 -- -- -- -- 3,029 -- 11,179 27,768 Investment Grade Tax-Exempt Bond Fund 2,622 -- -- -- -- -- -- 2,622 2,053 Limited-Term Federal Mortgage Securities Fund 2,189 -- -- -- -- -- -- 2,189 1,288 Maryland Municipal Bond Fund 22 -- -- -- -- -- 19 3 233 Short-Term Bond Fund 3,701 528 254 555 284 1,134 -- 946 1,178 Short-Term U.S. Treasury Securities Fund -- -- -- -- -- -- -- -- 15 U.S. Government Securities Fund 1,636 -- -- -- -- 792 -- 844 911 Virginia Intermediate Municipal Bond Fund -- -- -- -- -- -- -- -- 2,062 Virginia Municipal Bond Fund 53 -- -- -- -- -- -- 53 490
For tax purposes, the losses in the Funds can be carried forward for a maximum of eight years to offset any net realized capital gains. 8. Concentration of Credit Risk: The Investment Grade Bond Fund and the Short-Term Bond Fund invest primarily in investment grade obligations rated at least BBB or better by S&P or Baa or better by Moody's or, if not rated, are determined by the investment adviser to be of comparable quality. The Investment Grade Tax-Exempt Fund invests primarily in investment grade municipal securities. Municipal securities must be rated BBB or better by S&P or Baa or better by Moody's in the case of bonds; SP-1, SP-2 or MIG-1, MIG-2 in the case of notes; A-1, A-2 or P-1, P-2 in the case of commercial paper; and VMIG-1, VMIG-2 in the case of variable rate demand obligations. The Short-Term U.S. Treasury Securities Fund invests exclusively in obligations issued by the U.S. 76 - ------------------------------------------------------------------------------- Treasury with a maximum remaining maturity of 3 years or less. The Florida Tax-Exempt Bond Fund, the Georgia Tax-Exempt Bond Fund, the Maryland Municipal Bond Fund, the Virginia Intermediate Municipal Bond Fund, and the Virginia Municipal Bond Fund invest primarily in municipal bonds concentrated in each of their respective states. Municipal securities must be rated BBB or better by S&P or Baa or better by Moody's in the case of bonds; A-1, A-2 or P-1, P-2 in the case of tax-exempt commercial paper; and VMIG-1, VMIG-2 in the case of variable rate demand obligations. The U.S. Government Securities Fund invests primarily in obligations issued or guaranteed by the U.S. Government or its agencies or instrumentalities, including mortgage backed securities. The Limited-Term Federal Mortgage Securities Fund invests in mortgage related securities issued or guaranteed by U.S. Government agencies. Up to 35% of the U.S. Government Securities Fund and the Limited-Term Federal Mortgage Securities Fund may be invested in corporate, or government bonds that carry a rating of BBB or better by S&P or Baa or better by Moody's. The ability of the issuers of the securities held by the funds to meet their obligations may be affected by economic developments in a specific industry, state or region, or by changing business conditions. The High Income Fund that invests in high yield instruments is subject to certain credit and market risks. The yields of high debt obligations reflect, among other things, perceived credit risk. The Funds' investment in securities rated below investment grade typically involves risks not associated with higher rated securities including, among others, greater risks of timely and ultimate payment of interest and principal, greater market price volatility and less liquid secondary marketing trading. 9. CrestFunds Merger The Board of Directors and shareholders of the CrestFunds approved a reorganization of the CrestFunds into STI Classic Funds which took place during May 1999. The following table summarizes certain relevant information of the Funds prior to and immediately after the business combinations in May 1999 and is unaudited: OUTSTANDING UNREALIZED ON MERGER APPRECIATION CRESTFUNDS DATE (DEPRECIATION) - ------------------------------------ ---------- ------------ Intermediate Bond Trust Shares 32,817,534$ (3,403,150) Investor Class A 248,950 (67,865) Investor Class B -- -- Limited Term Bond Trust Shares 7,494,047 31,650 Investor Class A -- -- Investor Class B -- -- Government Bond Trust Shares 5,608,897 (698,071) Investor Class A -- -- Investor Class B 315,993 61,930 Maryland Municipal Bond (1) Trust Shares 2,941,190 305,068 Investor Class B 764,740 (31,446) Virginia Intermediate Municipal Bond (1) Trust Shares 23,538,137 5,880,351 Investor Class A 753,539 76,972 Virginia Municipal Bond (1) Trust Shares 3,019,996 511,586 Investor Class B 647,089 (13,152) SHARES ISSUED NET ASSETS NAV IN BUSINESS AFTER PER STI CLASSIC FUNDS COMBINATION COMBINATION SHARE - ------------------------- -------------- ---------- ------ Investment Grade Bond (1) Trust Shares 30,232,924 $1,152,435,532 $10.40 Investor Shares 229,458 35,442,645 10.40 Flex Shares -- 25,684,095 10.41 Short-Term Bond (1) Trust Shares 7,307,720 209,577,527 9.96 Investor Shares -- 1,817,569 9.97 Flex Shares -- 2,447,180 9.98 U.S. Government Securities (1) Trust Shares 5,438,788 101,799,419 10.32 Investor Shares -- 2,563,370 10.31 Flex Shares 307,517 11,288,553 10.32 Maryland Municipal Bond Trust Shares 2,941,190 29,603,005 10.06 Flex Shares 764,740 7,712,932 10.09 Virginia Intermediate Municipal Bond Trust Shares 23,538,137 240,886,726 10.23 Investor Shares 753,539 7,715,363 10.24 Virginia Municipal Bond Trust Shares 3,019,996 31,617,660 10.47 Flex Shares 647,089 6,805,221 10.52 (1) Represents the accounting survivor in this business combination. 10. ESC Strategic Funds Merger The Board of Directors and shareholders of the ESC Strategic Funds approved a reorganization of the ESC Strategic Income Fund into STI Classic High Income Fund which took place during March 2000. The following table summarizes certain relevant information of the Funds prior to and immediately after the business combinations in March 2000 and is unaudited: OUTSTANDING UNREALIZED ON MERGER APPRECIATION ESC STRATEGIC FUNDS DATE (DEPRECIATION) - ----------------------- ------------ ------------ ESC Strategic Income Class D 213,037 $(133,549) SHARES ISSUE NET ASSETS NAV IN BUSINESS AFTER PER STI CLASSIC FUNDS COMBINATION COMBINATION SHARE - ------------------ ------------- ----------- ------ High Income Flex Shares 213,037 $1,697,825 $7.97 11. Subsequent Event Effective June 30, 2000, SunTrustBanks, Inc. reorganized all of the investment management functions of its three institutional money management units, including SunTrust Bank, into Trusco Capital Management, Inc. 77 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS - ------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 To the Shareholders and Board of Trustees of STI Classic Funds: We have audited the accompanying statements of net assets of the Florida Tax-Exempt Bond, Georgia Tax-Exempt Bond, High Income, Investment Grade Bond, Limited-Term Federal Mortgage Securities, Maryland Municipal Bond, Short-Term Bond, Short-Term U.S. Treasury Securities, U.S. Government Securities, Virginia Intermediate Municipal Bond, and Virginia Municipal Bond Funds and the statement of assets and liabilities, including the schedule of investments, of the Investment Grade Tax-Exempt Bond Fund of STI Classic Funds (the "Trust") as of May 31, 2000, and the related statements of operations, changes in net assets, and financial highlights for the periods presented, excluding the periods indicated below. These financial statements and financial highlights are the responsibility of the Trust's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The statements of changes for the year ended November 30, 1998, and financial highlights for the periods prior to May 31, 1999, for the Maryland Municipal Bond, Virginia Intermediate Municipal Bond, and Virginia Municipal Bond Funds were audited by other auditors whose report dated January 15, 1999, expressed an unqualified opinion on this information. The statement of changes for the year ended March 31, 1999, and financial highlights for the periods prior to March 31, 2000, for the High Income Fund, were audited by other auditors whose report dated May 14, 1999, expressed an unqualified opinion on this information. We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights. Our procedures included confirmation of securities owned as of May 31, 2000, by correspondence with the custodian and the application of alternative auditing procedures with respect to unsettled securities transactions. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights audited by us present fairly, in all material respects, the financial position of the Florida Tax-Exempt Bond, Georgia Tax-Exempt Bond, High Income, Investment Grade Bond, Investment Grade Tax-Exempt Bond, Limited-Term Federal Mortgage Securities, Maryland Municipal Bond, Short-Term Bond, Short-Term U.S. Treasury Securities, U.S. Government Securities, Virginia Intermediate Municipal Bond, and Virginia Municipal Bond Funds, of STI Classic Funds as of May 31, 2000, the results of their operations, changes in their net assets, and financial highlights for each of the periods described in the first paragraph above, in conformity with accounting principles generally accepted in the United States. ARTHUR ANDERSEN LLP Philadelphia, Pennsylvania July 18, 2000 78 NOTICE TO SHAREHOLDERS - -------------------------------------------------------------------------------- STI CLASSIC FIXED INCOME FUNDS MAY 31, 2000 UNAUDITED For shareholders that do not have a May 31, 2000 tax year end, this notice is for informational purposes only. For shareholders with a May 31, 2000, please consult your tax adviser as to the pertinence of this notice. For the fiscal year ended May 31, 2000, each portfolio is designating the following items with regard to distributions paid during the year: LONG TERM (20% RATE) ORDINARY CAPITAL GAIN INCOME TAX-EXEMPT TOTAL QUALIFYING FUND DISTRIBUTION DISTRIBUTIONS INTEREST INTEREST DIVIDENDS (1) - -------------------------------------------- ------------- ------------- ----------- -------- ------------- Florida Tax-Exempt Bond Fund 8.30% 2.93% 88.77% 100.00% 0.00% Georgia Tax-Exempt Bond Fund 7.06% 1.56% 91.38% 100.00% 0.00% High Income Fund 0.00% 100.00% 0.00% 100.00% 0.00% Investment Grade Bond Fund 0.00% 100.00% 0.00% 100.00% 0.00% Investment Grade Tax-Exempt Bond Fund 10.08% 21.54% 68.38% 100.00% 0.00% Limited-Term Federal Mortgage Securities Fund 0.00% 100.00% 0.00% 100.00% 0.00% Maryland Municipal Bond Fund 0.00% 0.59% 99.41% 100.00% 0.00% Short-Term Bond Fund 1.29% 98.71% 0.00% 100.00% 0.00% Short-Term U.S. Treasury Securities Fund 0.25% 99.75% 0.00% 100.00% 0.00% U.S. Government Securities 0.00% 100.00% 0.00% 100.00% 0.00% Virginia Intermediate Municipal Bond Fund 10.95% 0.92% 88.13% 100.00% 0.00% Virginia Municipal Bond Fund 1.00% 0.75% 98.25% 100.00% 0.00% (1) QUALIFYING DIVIDENDS REPRESENT DIVIDENDS WHICH QUALIFY FOR THE CORPORATE DIVIDENDS RECEIVED DEDUCTION AND IS REFLECTED AS A PERCENTAGE OF "ORDINARY INCOME DISTRIBUTIONS".
79 NOTES INVESTMENT ADVISER Trusco Capital Management, Inc. STI Classic Funds are not deposits, are not insured or guaranteed by the FDIC or any other government agency, and are not endorsed by and do not constitute obligations of SunTrust Banks, Inc. or any other of its affiliates. Investment in the Funds involves risk, including the possible loss of principal. There is no guarantee that any STI Classic Fund will achieve its investment objective. The STI Classic Funds are advised by affiliates of SunTrust Banks, Inc. DISTRIBUTOR SEI Investments Distribution Co. This information must be preceded or accompanied by a current prospectus for each Fund described. -----END PRIVACY-ENHANCED MESSAGE-----