Banknorth Funds
BANKNORTH LARGE CAP CORE FUND
BANKNORTH SMALL/MID CAP CORE FUND
BANKNORTH INTERMEDIATE BOND FUND
BANKNORTH VERMONT MUNICIPAL BOND FUND
Management's Discussion of Fund Performance | 1 | |
Portfolio of Investments | 9 | |
Notes to Portfolios of Investments | 27 | |
Statements of Assets and Liabilities | 28 | |
Statements of Operations | 29 | |
Statement of Changes in Net Assets | 30 | |
Financial Highlights | 32 | |
Combined Notes to Financial Statements | 34 | |
Independent Auditor's Report | 40 | |
Board of Trustees and Trust Officers | 41 |
August 31, 2003
Management's Discussion of Fund Performance
Banknorth Large Cap Core Fund
The year ended August 31, 2003 provided equity investors with quite a roller coaster ride. The Standard & Poor's 500 Index (S&P 500)1 twice tested the low of below 800 first reached in July 2002 before rebounding to close out the period above the 1000 mark. The NASDAQ registered even more impressive gains, up over 50% from its lows. The drivers of this performance were an economic background of slow recovery, falling interest rates, and outside events that included the Iraq situation, tax cuts, and the early stages of the 2004 Presidential race. These events raised investor uncertainty to very high levels early in 2003, causing a third and final test of the market low in March. This was followed by a strong recovery that provided a total return of 12.06% for the twelve-month reporting period for the S&P 500, the fund's most appropriate benchmark, following two years of declines.
The Banknorth Large Cap Core Fund lagged the market in these volatile times, with a total return of 6.78%, behind the S&P 500 by approximately 5.30%. The shortfall occurred during the second quarter of calendar 2003. While we realized positive returns during that time, the market overall did far better. This was due to our emphasis on better quality companies with steadier growth prospects and lower risk profiles, an approach that served us well during the years of decline. During the second quarter the market favored stocks of lower quality which would benefit from a robust economic recovery. Our own outlook, although positive, was for a more moderate pace of economic growth. We positioned the portfolio in companies and sectors with less aggressive, more assured potential for increased earnings. We note that the fund's performance has improved since the end of the second quarter.
1 The S&P 500 is an unmanaged capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. Investments cannot be made in an index.
Banknorth Large Cap Core Fund
GROWTH OF $10,000 INVESTED IN BANKNORTH LARGE CAP CORE FUND1,2
The following chart reflects a hypothetical comparison in the change in value of a $10,000 investment from December 17, 1997 to August 31, 2003, including the maximum sales charge, in Banknorth Large Cap Core Fund, including reinvestment of dividends and distributions, to the S&P 500. Total returns for the index do not reflect sales charges, expenses or other fees that the Securities and Exchange Commission (SEC) requires to be reflected in the Fund's returns. The Fund is professionally managed while the index is unmanaged and is not available for investment. During the period, the Fund waived certain fees and expenses; otherwise, total return would have been lower.
AVERAGE ANNUAL TOTAL RETURN3 FOR THE
PERIOD ENDED AUGUST 31, 20032
1 Year | 0.95 | % | |
5 Years | 4.09 | % | |
Since Inception (12/17/97) | 4.05 | % |
Investment return and principal value of an investment in the Fund will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Past performance is no guarantee of future results. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured.
1 Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 5.50% ($10,000 investment minus $550 sales charge = $9,450).
2 The Fund is the successor to the Investors Equity Fund (Former Fund), a former series of Forum Funds, pursuant to a reorganization that took place on January 8, 2001. Prior to that date, the Fund had no investment operations. The returns provided for periods prior to January 8, 2001, are historical information of the Former Fund. The Former Fund was managed by the Banknorth Group, N.A. and had substantially the same investment policies as the Fund.
3 Total return quoted reflects all applicable sales charges.
Banknorth Small/Mid Cap Core Fund
The year ended August 31, 2003 provided equity investors with quite a roller coaster ride. The Standard & Poor's 500 Index (S&P 500)1 twice tested the low of below 800 first reached in July 2002 before rebounding to close out the period above the 1000 mark. The NASDAQ registered even more impressive gains, up over 50% from its lows. The drivers of this performance were an economic background of slow recovery, falling interest rates, and outside events that included the Iraq situation, tax cuts, and the early stages of the 2004 Presidential race. These events raised investor uncertainty to very high levels early in 2003, causing a third and final test of the market low in March. This was followed by a strong recovery that provided a 12-month total return of 12.06% for the S&P 500 following two years of declines. The Russell Midcap Index (RMCI)2 , the fund's benchmark, returned 21.92%.
The Banknorth Small/Mid Cap Core Fund lagged the market in these volatile times, recording a total return of 7.33%. The bulk of this shortfall occurred during the second quarter of calendar 2003. While we realized positive returns during that time, the market overall did far better. This was due to our emphasis on better quality companies with steadier growth prospects and lower risk profiles, an approach that served us well during the years of decline. During the second quarter especially, the market favored stocks of lower quality which would benefit from a robust economic recovery. Many of the best performing companies in the RMCI fail to meet our quality standards for consideration for purchase, and our own outlook, although positive, was for a more moderate pace of economic growth. We positioned the portfolio in companies and sectors with less aggressive, more assured potential for increased earnings. These companies did well, but not spectacularly.
1 The S&P 500 is an unmanaged capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. Investments cannot be made in an index.
2 The RMCI measures the performance of the 800 smallest companies in the Russell 1000 Index, which represent approximately 25% of the total market capitalization of the Russell 1000 Index. The index is unmanaged, and investments cannot be made in an index.
Banknorth Small/Mid Cap Core Fund
GROWTH OF $10,000 INVESTED IN BANKNORTH SMALL/MID CAP CORE FUND1,2
The following chart reflects a hypothetical comparison in the change in value of a $10,000 investment from May 31, 1999 to August 31, 2003, including the maximum sales charge, in Banknorth Small/Mid Cap Core Fund, including reinvestment of dividends and distributions, to the Russell 2500 Index(R2500I)3 and the RMCI. Total returns for each index do not reflect sales charges, expenses or other fees that the SEC requires to be reflected in the Fund's returns. The Fund is professionally managed while each index is unmanaged and is not available for investment. During the period, the Fund waived certain fees and expenses; otherwise, total return would have been lower.
AVERAGE ANNUAL TOTAL RETURN4 FOR THE
PERIOD ENDED AUGUST 31, 20032
1 Year | 1.40 | % | |
Since Inception (5/31/99) | (1.02 | )% |
Investment return and principal value of an investment in the Fund will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Past performance is no guarantee of future results. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured.
1 Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 5.50% ($10,000 investment minus $550 sales charge = $9,450).
2 The Fund is the successor to a portfolio of assets of CF Mid/Small Cap Fund (Former Fund), a common trust fund managed by the Adviser, which was transferred to the Fund on October 2, 2000 in exchange for Fund shares. The quoted returns are the returns of the Former Fund for periods before October 2, 2000, adjusted to reflect the Fund's expenses. The Former Fund was not registered under the Investment Company Act of 1940 ("1940 Act") and therefore was not subject to certain investment restrictions that are imposed by the 1940 Act. If the Former Fund had been registered under the 1940 Act, returns may have been adversely affected.
3 The R2500I measures the performance of the 2,500 smallest companies in the Russell 3000 Index, which represents approximately 23% of the total market capitalization of the Russell 3000 Index. The index is unmanaged, and investments cannot be made in an index.
4 Total return quoted reflects all applicable sales charges.
Banknorth Intermediate Bond Fund
During the last 12 months, economic uncertainty and the impending conflict with Iraq loomed large for U.S. financial markets. By the end of the reporting period, the mood had moved from apprehension to optimism as a result of a successful military campaign, positive earnings growth, and stronger economic reports. As a result the bond market experienced a significant level of price volatility during this period. The yield of the 10-year U.S. Treasury note hit a 45-year low of 3.11% on June 13, then went on to close at 4.46% at the end of the fiscal period. Through much of the last three years, falling interest rates boosted returns from bonds with the longest maturities and the highest quality ratings. Those trends reversed themselves in the second half of the year. The fund's results reflect these changes as falling bond prices more than offset interest income.
For the six and 12-month reporting periods ended August 31, 2003, the fund underperformed its benchmark, the Lehman Brothers Intermediate Government/Credit Index (LBIGC).1 At the start of the reporting period the fund's maturity structure was positioned for a period of rising interest rates, a strategy that contributed positively to relative returns in the first quarter of 2003. In the second quarter, however, this positioning detracted from performance. During the second quarter, the U.S. Federal Reserve announced concerns about deflation risk and as a result continued to support an easing bias cutting the federal funds target rate by 25 basis points to 1.00% in its June meeting. In a declining rate environment, the fund's short maturity profile relative to the LBIGC detracted from overall results for the year. Although interest rates increased sharply in late June and July, the change in rates served to only partially offset the fund's overall results versus the LBIGC. Simultaneously, a greater exposure to investment grade bonds, compared to the benchmark, contributed positively to overall performance. Over the reporting period, corporate bond performance improved relative to government bonds due to the positive effects of a gradually improving economic environment.
1 The LBIGC is a market value weighted performance benchmark for government and corporate fixed-rate debt issues with maturities between one and ten years. The index is unmanaged, and investments cannot be made in an index.
Banknorth Intermediate Bond Fund
GROWTH OF $10,000 INVESTED IN BANKNORTH INTERMEDIATE BOND FUND1,2
The following chart reflects a hypothetical comparison in the change in value of a $10,0001 investment from August 31, 1993 to August 31, 2003, including the maximum sales charge, in Banknorth Intermediate Bond Fund, including reinvestment of dividends and distributions, to the Lehman Brothers Intermediate Government/Credit Index (LBIGC). Total returns for the index do not reflect sales charges, expenses or other fees that the SEC requires to be reflected in the Fund's returns. The Fund is professionally managed while the index is unmanaged and is not available for investment. During the period, the Fund waived certain fees and expenses; otherwise, total return would have been lower.
AVERAGE ANNUAL TOTAL RETURN3 FOR
PERIOD ENDED AUGUST 31, 20032
1 Year | (1.44 | )% | |
5 Years | 3.59 | % | |
10 Years | 4.48 | % |
Investment return and principal value of an investment in the Fund will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Past performance is no guarantee of future results. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured.
1 Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 3.75% ($10,000 investment minus $375 sales charge = $9,625).
2 The Fund is the successor to a portfolio of assets of CF Max Income Bond Fund (Former Fund), a common trust fund managed by the Adviser, which was transferred to the Fund on October 2, 2000 in exchange for Fund shares. The quoted returns are the returns of the Former Fund for periods before October 2, 2000, adjusted to reflect the Fund's expenses. The Former Fund was not registered under the Investment Company Act of 1940 ("1940 Act") and therefore was not subject to certain investment restrictions that are imposed by the 1940 Act. If the Former Fund had been registered under the 1940 Act, returns may have been adversely affected.
3 Total return quoted reflects all applicable sales charges.
Banknorth Vermont Municipal Bond Fund
During the last 12 months, interest rates have increased significantly, except for the shorter end of the yield curve. Five years and longer, we saw rates increase on average 20%. On the long end, fifteen to thirty years, rates were up on average 8%. All in all, for the first time in a long time we saw rising interest rates.
The Banknorth Vermont Municipal Bond Fund was up 1.74%. This performance was in line with some general and state specific municipal indices; there is no Vermont benchmark index for appropriate comparison.
The fund has an average maturity and duration1 in the intermediate term and invests primarily in high quality Vermont paper, with less than 8% currently invested in out of state issues, excluding the money market balance. Our largest issuers include the State of Vermont, Vermont Municipal Bond Bank, Vermont Housing Finance Agency, Burlington Public Improvement and Vermont Education and Health for Marlboro College.
During the reporting period, the Vermont economy continued to lag the U.S. economy as a whole. Unemployment rates remained lower than the U.S. average, despite the increasing number of corporate layoffs (IBM, Blodgett, Ethan Allen and others). Like other New England states, Vermont's fiscal policy went into deficit in 2002. Yet, the general obligation of the state retained an AA-rating.
1 Duration is a measure of a security's price sensitivity to changes in interest rates. Securities with longer durations are more sensitive to changes in interest rates than securities of shorter durations.
Banknorth Vermont Municipal Bond Fund
GROWTH OF $10,000 INVESTED IN BANKNORTH VERMONT MUNICIPAL BOND FUND1,2
The following chart reflects a hypothetical comparison in the change in value of a $10,000 investment from August 31, 1993 to August 31, 2003, including the maximum sales charge, in Banknorth Vermont Municipal Bond Fund, including reinvestment of dividends and distributions, to the Lehman Brothers 5-Year Municipal Bond Index. 3 Total returns for the index do not reflect sales charges, expenses or other fees that the SEC requires to be reflected in the Fund's returns. The Fund is professionally managed while the index is unmanaged and is not available for investment. During the period, the Fund waived certain fees and expenses; otherwise, total return would have been lower.
AVERAGE ANNUAL TOTAL RETURN4 FOR THE
PERIOD ENDED AUGUST 31, 20032
1 Year | (2.08 | )% | |
5 Years | 2.37 | % | |
10 Years | 3.26 | % |
Investment return and principal value of an investment in the Fund will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Past performance is no guarantee of future results. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured.
1 Represents a hypothetical investment of $10,000 in the Fund after deducting the maximum sales charge of 3.75% ($10,000 investment minus $375 sales charge = $9,625).
2 The Fund is the successor to a portfolio of assets of CF Vermont Tax Exempt Fund (Former Fund), a common trust fund managed by the Adviser, which was transferred to the Fund on October 2, 2000 in exchange for Fund shares. The quoted returns are the returns of the Former Fund for periods before October 2, 2000, adjusted to reflect the Fund's expenses. The Former Fund was not registered under the Investment Company Act of 1940 ("1940 Act") and therefore was not subject to certain investment restrictions that are imposed by the 1940 Act. If the Former Fund had been registered under the 1940 Act, returns may have been adversely affected.
3 The Lehman Brothers 5-Year Municipal Bond Index is a broad market performance benchmark for the tax-exempt bond market. The index is unmanaged and investments cannot be made in an index.
4 Total return quoted reflects all applicable sales charges.
Portfolio of Investments
Banknorth Funds
August 31, 2003
BANKNORTH LARGE CAP CORE FUND
Shares | Security Name | Value | |||
COMMON STOCK--95.4% | |||||
Aerospace & Defense--2.3% | |||||
30,000 | United Technologies Corp. | $ | 2,407,500 | ||
| Air Freight & Couriers--2.9% |
| |||
45,000 | FedEx Corp. |
| 3,019,500 | ||
| Banks--4.3% |
| |||
41,000 | Bank of America Corp. | 3,249,250 | |||
25,000 | Wells Fargo & Co. |
| 1,253,500 | ||
|
|
| 4,502,750 | ||
| Beverages--1.0% |
| |||
20,000 | Anheuser--Busch Cos., Inc. |
| 1,030,800 | ||
| Chemicals--1.2% |
| |||
50,000 | Ecolab, Inc. |
| 1,289,500 | ||
| Commercial Services & Supplies--5.3% |
| |||
25,000 | Banta Corp. | 868,250 | |||
65,000 | First Data Corp. | 2,496,000 | |||
60,000 | HON Industries, Inc. |
| 2,203,200 | ||
|
|
| 5,567,450 | ||
| Communications Equipment--4.3% |
| |||
167,720 | Cisco Systems, Inc.† | 3,211,838 | |||
30,000 | Qualcomm, Inc. |
| 1,238,400 | ||
|
|
| 4,450,238 | ||
| Computers & Peripherals--2.4% |
| |||
30,000 | IBM Corp. |
| 2,460,300 | ||
| Diversified Financials--9.1% |
| |||
55,000 | American Express Co. | 2,477,750 | |||
50,000 | Citigroup, Inc. | 2,167,500 | |||
35,000 | Merrill Lynch & Co., Inc. | 1,882,300 | |||
75,000 | SLM Corp. |
| 3,013,500 | ||
|
|
| 9,541,050 | ||
Shares | Security Name | Value | |||
COMMON STOCK--continued | |||||
Electric Utilities--3.7% | |||||
35,000 | FPL Group, Inc. | $ | 2,165,100 | ||
60,000 | Southern Co. |
| 1,702,800 | ||
|
|
| 3,867,900 | ||
| Energy Equipment & Services--2.1% |
| |||
60,000 | BJ Services Co.† |
| 2,242,200 | ||
| Food & Drug Retailing--2.4% |
| |||
80,000 | Sysco Corp. |
| 2,516,800 | ||
| Food Products--2.5% |
| |||
60,000 | McCormick & Co., Inc. | 1,602,000 | |||
20,000 | WM Wrigley Jr. Co. |
| 1,061,000 | ||
|
|
| 2,663,000 | ||
| Healthcare Equipment & Supplies--6.8% |
| |||
60,000 | Becton Dickinson & Co. | 2,192,400 | |||
54,300 | Medtronic, Inc. | 2,692,194 | |||
30,000 | Stryker Corp. |
| 2,274,000 | ||
|
|
| 7,158,594 | ||
| Healthcare Providers & Services--4.7% |
| |||
35,000 | Express Scripts, Inc.† | 2,268,350 | |||
54,000 | UnitedHealth Group, Inc. |
| 2,669,220 | ||
|
|
| 4,937,570 | ||
| Hotels, Restaurants & Leisure--3.9% |
| |||
45,000 | Brinker International, Inc.† | 1,539,000 | |||
74,000 | Carnival Corp. |
| 2,559,660 | ||
|
|
| 4,098,660 | ||
| Industrial Conglomerates--1.6% |
| |||
12,000 | 3M Co. |
| 1,709,640 | ||
| Insurance--4.7% |
| |||
75,000 | AFLAC, Inc. | 2,400,750 | |||
50,000 | Marsh & McLennan Cos., Inc. |
| 2,500,000 | ||
|
|
| 4,900,750 | ||
Shares | Security Name | Value | |||
COMMON STOCK--continued | |||||
Machinery--2.6% | |||||
35,000 | Danaher Corp. | $ | 2,703,750 | ||
| Media--1.5% |
| |||
20,000 | Gannett Co., Inc. |
| 1,568,400 | ||
| Oil & Gas--3.0% |
| |||
30,000 | ConocoPhillips | 1,675,200 | |||
40,000 | Exxon Mobil Corp. |
| 1,508,000 | ||
|
|
| 3,183,200 | ||
| Personal Products--2.1% |
| |||
20,000 | Colgate--Palmolive Co. | 1,105,600 | |||
12,000 | Procter & Gamble Co. |
| 1,047,480 | ||
|
|
| 2,153,080 | ||
| Pharmaceuticals--3.7% |
| |||
40,000 | Forest Laboratories, Inc.† | 1,880,000 | |||
20,000 | Merck & Co., Inc. | 1,006,400 | |||
32,000 | Pfizer, Inc. |
| 957,440 | ||
|
|
| 3,843,840 | ||
| Semiconductor Equipment & Products--5.6% |
| |||
35,000 | Analog Devices, Inc.† | 1,435,000 | |||
110,000 | Intel Corp. | 3,148,200 | |||
30,000 | Linear Technology Corp. |
| 1,236,600 | ||
|
|
| 5,819,800 | ||
| Software--4.7% |
| |||
35,000 | Adobe Systems, Inc. | 1,359,050 | |||
40,000 | Microsoft Corp. | 1,060,800 | |||
200,000 | Oracle Corp.† |
| 2,556,000 | ||
|
|
| 4,975,850 | ||
| Specialty Retail--7.0% |
| |||
60,000 | Bed Bath & Beyond, Inc.† | 2,581,800 | |||
100,000 | Gap, Inc. | 2,089,000 | |||
110,000 | Staples, Inc.† |
| 2,709,300 | ||
|
|
| 7,380,100 | ||
| TOTAL COMMON STOCK (Cost $81,883,119) | 99,992,222 | |||
Shares | Security Name | Value | |||
SHORT-TERM INVESTMENTS--4.6% | |||||
4,667,623 | Monarch Daily Assets Treasury Fund | $ | 4,667,623 | ||
153,008 | Scudder Cash Management Fund |
| 153,008 | ||
| TOTAL SHORT-TERM INVESTMENTS (Cost $4,820,631) |
| 4,820,631 | ||
| TOTAL INVESTMENTS IN SECURITIES (Cost $86,703,750)--100.0% | 104,812,853 | |||
| Other Assets and Liabilities, Net--0.0% |
| 4,356 | ||
| TOTAL NET ASSETS--100.0% | $ | 104,817,209 | ||
† Non-income earning securities
BANKNORTH SMALL/MID CAP CORE FUND
Shares | Security Name | Value | ||||
COMMON STOCK--98.4% |
| |||||
Automobiles--2.4% |
| |||||
5,000 | Paccar, Inc. | $ | 426,000 |
| ||
| Banks--4.9% |
|
|
| ||
20,000 | AmSouth Bancorp | 430,800 |
| |||
10,000 | First Tennessee National Corp. |
| 413,500 |
| ||
|
|
| 844,300 |
| ||
| Chemicals--5.0% |
|
|
| ||
14,000 | Ecolab, Inc. | 361,060 |
| |||
8,000 | Praxair, Inc. |
| 510,560 |
| ||
|
|
| 871,620 |
| ||
| Commercial Services & Supplies--4.9% |
|
|
| ||
7,000 | Deluxe Corp. | 298,900 |
| |||
15,000 | HON Industries, Inc. |
| 550,800 |
| ||
|
|
| 849,700 |
| ||
| Communications Equipment--3.1% |
|
|
| ||
16,000 | Scientific-Atlanta, Inc. |
| 544,000 |
| ||
| Computers & Peripherals--4.7% |
|
|
| ||
11,500 | Diebold, Inc. | 562,350 |
| |||
12,000 | Electronics for Imaging, Inc.† |
| 257,040 |
| ||
|
|
| 819,390 |
| ||
| Diversified Financials--4.6% |
|
|
| ||
10,000 | Franklin Resources, Inc. | 431,900 |
| |||
5,000 | Legg Mason, Inc. |
| 359,150 |
| ||
|
|
| 791,050 |
| ||
| Electric Utilities--1.2% |
|
|
| ||
6,000 | Cinergy Corp. |
| 205,320 |
| ||
| Electrical Equipment--2.5% |
|
|
| ||
24,000 | American Power Conversion Corp. |
| 430,080 |
| ||
| Energy Equipment & Services--2.1% |
|
|
| ||
10,000 | BJ Services Co.† |
| 373,700 |
| ||
Shares | Security Name | Value | ||||
COMMON STOCK--continued |
| |||||
Food Products--4.6% |
| |||||
8,000 | Hormel Foods Corp. | $ | 172,800 |
| ||
5,000 | JM Smucker Co. | 202,400 |
| |||
16,000 | McCormick & Co., Inc. |
| 427,200 |
| ||
|
|
| 802,400 |
| ||
| Gas Utilities--5.3% |
|
|
| ||
14,000 | Questar Corp. | 449,120 |
| |||
16,000 | Sempra Energy |
| 476,000 |
| ||
|
|
| 925,120 |
| ||
| Healthcare Equipment & Supplies--3.7% |
|
|
| ||
10,000 | Biomet, Inc. | 297,300 |
| |||
8,000 | Dentsply International, Inc. |
| 350,000 |
| ||
|
|
| 647,300 |
| ||
| Healthcare Providers & Services--4.2% |
|
|
| ||
6,500 | Express Scripts, Inc.† | 421,265 |
| |||
12,000 | First Health Group Corp.† |
| 314,640 |
| ||
|
|
| 735,905 |
| ||
| Hotels, Restaurants & Leisure--3.8% |
|
|
| ||
4,000 | Cheesecake Factory, Inc.† | 145,760 |
| |||
20,000 | International Game Technology |
| 516,800 |
| ||
|
|
| 662,560 |
| ||
| Household Products--1.5% |
|
|
| ||
8,000 | Church & Dwight Co., Inc. |
| 255,600 |
| ||
| Insurance--3.2% |
|
|
| ||
9,000 | Brown & Brown, Inc. | 279,000 |
| |||
7,000 | Torchmark Corp. |
| 282,520 |
| ||
|
|
| 561,520 |
| ||
| IT Consulting & Services--3.9% |
|
|
| ||
20,000 | Acxiom Corp.† | 323,200 |
| |||
7,000 | Affiliated Computer Services, Inc. Class A† |
| 347,270 |
| ||
|
|
| 670,470 |
| ||
| Leisure Equipment & Products--1.0% |
|
|
| ||
6,000 | Eastman Kodak Co. |
| 167,340 |
| ||
Shares | Security Name | Value | ||||
COMMON STOCK--continued |
| |||||
| Machinery--5.7% |
|
|
| ||
10,000 | Carlisle Cos., Inc. | $ | 454,900 |
| ||
7,000 | Danaher Corp. |
| 540,750 |
| ||
|
|
| 995,650 |
| ||
| Multiline Retail--2.3% |
|
|
| ||
10,000 | Family Dollar Stores, Inc. |
| 401,200 |
| ||
| Oil & Gas--4.9% |
|
|
| ||
14,000 | Marathon Oil Corp. | 390,460 |
| |||
8,000 | Murphy Oil Corp. |
| 461,840 |
| ||
|
|
| 852,300 |
| ||
| Pharmaceuticals--5.2% |
|
|
| ||
5,000 | Allergan, Inc. | 397,300 |
| |||
14,000 | Mylan Laboratories, Inc. |
| 509,600 |
| ||
|
|
| 906,900 |
| ||
| Semiconductor Equipment & Products--2.1% |
|
|
| ||
9,000 | Linear Technology Corp. |
| 370,980 |
| ||
| Software--2.5% |
|
|
| ||
11,000 | Adobe Systems, Inc. |
| 427,130 |
| ||
| Specialty Retail--9.1% |
|
|
| ||
12,000 | Bed Bath & Beyond, Inc.† | 516,360 |
| |||
20,000 | Staples, Inc.† | 492,600 |
| |||
20,000 | Starbucks Corp.† |
| 568,800 |
| ||
|
|
| 1,577,760 |
| ||
| TOTAL COMMON STOCK (Cost $14,397,475) |
| 17,115,295 |
| ||
| SHORT-TERM INVESTMENT--1.7% |
|
|
| ||
294,802 | Monarch Daily Assets Treasury Fund (Cost $294,802) |
| 294,802 |
| ||
| TOTAL INVESTMENTS IN SECURITIES (Cost $14,692,277)--100.1% | 17,410,097 |
| |||
| Other Assets and Liabilities, Net--(0.1%) |
| (15,417 | ) | ||
| TOTAL NET ASSETS--100.0% | $ | 17,394,680 |
| ||
† Non-income earning securities
BANKNORTH INTERMEDIATE BOND FUND
Principal | Security Name | Interest | Maturity | Value | ||||||
CORPORATE BONDS & NOTES--62.5% | ||||||||||
Automotive Repair, Services & Parking--0.5% | ||||||||||
$ | 500,000 | Hertz Corp. | 6.38 | 10/15/05 | $ | 513,315 | ||||
|
| Building Materials, Hardware, Garden Supply & Mobile Home Dealers--1.2% |
|
|
|
| ||||
| 900,000 | Lowe's Cos., Inc. | 6.38 | 12/15/05 |
| 976,981 | ||||
| 303,000 | Sherwin-Williams Co. | 6.85 | 02/01/07 |
| 336,585 | ||||
|
|
|
|
|
| 1,313,566 | ||||
|
| Communications--3.1% |
|
|
|
| ||||
| 1,000,000 | Alltel Corp. | 6.65 | 01/15/08 |
| 1,103,194 | ||||
| 250,000 | GTE South, Inc. | 6.13 | 06/15/07 |
| 272,137 | ||||
| 2,000,000 | Pacific Bell | 6.25 | 03/01/05 |
| 2,125,844 | ||||
|
|
|
|
|
| 3,501,175 | ||||
|
| Consumer Staples-- 2.2% |
|
|
|
| ||||
| 2,500,000 | Safeway, Inc. | 5.80 | 08/15/12 |
| 2,537,480 | ||||
|
| Depository Institutions--9.5% |
|
|
|
| ||||
| 1,000,000 | ABN Amro Bank NV, Chicago | 7.55 | 06/28/06 |
| 1,128,406 | ||||
| 2,500,000 | CIT Group, Inc. | 4.00 | 05/08/08 |
| 2,477,755 | ||||
| 1,500,000 | Citicorp | 7.13 | 09/01/05 |
| 1,642,183 | ||||
| 2,000,000 | Citigroup, Inc. | 6.20 | 03/15/09 |
| 2,210,372 | ||||
| 1,000,000 | JP Morgan Chase Bank | 6.63 | 08/15/05 |
| 1,077,637 | ||||
| 1,000,000 | Mercantile Bancorp | 7.30 | 06/15/07 |
| 1,136,662 | ||||
| 500,000 | National City Corp. | 6.63 | 03/01/04 |
| 512,885 | ||||
| 500,000 | Southtrust Bank NA | 7.00 | 11/15/08 |
| 568,809 | ||||
|
|
|
|
|
| 10,754,709 | ||||
|
| Electric, Gas & Sanitary Services--6.2% |
|
|
|
| ||||
| 1,000,000 | Alabama Power Co., Series L | 7.13 | 10/01/07 |
| 1,128,804 | ||||
| 1,030,000 | Carolina Power & Light Co. | 5.88 | 01/15/04 |
| 1,046,987 | ||||
| 250,000 | Carolina Power & Light Co. | 7.88 | 04/15/04 |
| 259,713 | ||||
| 1,000,000 | Carolina Power & Light Co. | 6.80 | 08/15/07 |
| 1,099,017 | ||||
| 600,000 | Midamerican Energy Co. | 6.38 | 06/15/06 |
| 650,284 | ||||
| 1,650,000 | Public Service Electric & Gas Co., Series PP | 6.50 | 05/01/04 |
| 1,702,868 | ||||
| 1,050,000 | Public Service Electric & Gas Co., Series UU | 6.75 | 03/01/06 |
| 1,149,323 | ||||
|
|
|
|
|
| 7,036,996 | ||||
Principal | Security Name | Interest | Maturity | Value | ||||||
CORPORATE BONDS & NOTES--continued | ||||||||||
General Merchandise Stores--1.1% | ||||||||||
$ | 1,250,000 | Sears Roebuck & Co. | 6.25 | 01/15/04 | $ | 1,263,587 | ||||
|
| Industrial & Commercial Machinery & |
|
|
|
| ||||
| 2,500,000 | Hewlett-Packard Company | 6.50 | 07/01/12 |
| 2,720,995 | ||||
| 2,000,000 | IBM Corp. | 6.45 | 08/01/07 |
| 2,193,188 | ||||
|
|
|
|
|
| 4,914,183 | ||||
|
| Measuring, Analyzing & Controlling Instruments; Photographic, Medical, & Optical Goods--1.0% |
|
|
|
| ||||
| 1,000,000 | Baxter International, Inc. | 7.13 | 02/01/07 |
| 1,118,972 | ||||
|
| Motion Pictures--2.6% |
|
|
|
| ||||
| 200,000 | Walt Disney Co. | 5.62 | 12/01/08 |
| 208,740 | ||||
| 2,550,000 | Walt Disney Co., Series B | 6.75 | 03/30/06 |
| 2,778,284 | ||||
|
|
|
|
|
| 2,987,024 | ||||
|
| Nondepository Credit Institutions-- 7.2% |
|
|
|
| ||||
| 500,000 | Ford Motor Credit Co. | 6.13 | 01/09/06 |
| 517,845 | ||||
| 2,500,000 | Ford Motor Credit Co. | 7.88 | 06/15/10 |
| 2,618,650 | ||||
| 1,000,000 | General Motors Acceptance Corp. | 6.63 | 10/15/05 |
| 1,056,587 | ||||
| 1,000,000 | Household Finance Corp. | 8.00 | 05/09/05 |
| 1,094,678 | ||||
| 300,000 | Household Finance Corp. | 7.20 | 07/15/06 |
| 334,173 | ||||
| 2,500,000 | John Deere Capital Corp. | 5.10 | 01/15/13 |
| 2,472,745 | ||||
|
|
|
|
|
| 8,094,678 | ||||
|
| Paper & Allied Products--0.5% |
|
|
|
| ||||
| 500,000 | International Paper Co. | 7.63 | 08/01/04 |
| 525,042 | ||||
|
| Security & Commodity Brokers, Dealers, |
|
|
|
| ||||
| 1,000,000 | Goldman Sachs Group, Inc. | 7.35 | 10/01/09 |
| 1,137,672 | ||||
| 2,500,000 | JP Morgan Chase & Co. | 7.00 | 11/15/09 |
| 2,763,232 | ||||
| 2,500,000 | JP Morgan Chase & Co. | 5.75 | 01/02/13 |
| 2,573,325 | ||||
| 1,500,000 | Lehman Brothers Holdings, Inc. | 8.50 | 08/01/15 |
| 1,814,460 | ||||
| 2,500,000 | Merrill Lynch & Co., Inc. | 6.38 | 10/15/08 |
| 2,767,367 | ||||
| 1,000,000 | Morgan Stanley | 6.50 | 11/01/05 |
| 1,081,831 | ||||
| 660,000 | Paine Webber Group, Inc. | 7.39 | 10/16/17 |
| 747,209 | ||||
| 250,000 | Transamerica Financial Corp. | 7.50 | 03/15/04 |
| 257,459 | ||||
|
|
|
|
|
| 13,142,555 | ||||
Principal | Security Name | Interest | Maturity | Value | ||||||
CORPORATE BONDS & NOTES--continued | ||||||||||
Tobacco Products--2.3% | ||||||||||
$ | 2,500,000 | Altria Group, Inc. | 7.20 | 02/01/07 | $ | 2,585,068 | ||||
|
| Transportation Equipment--9.1% |
|
|
|
| ||||
| 2,500,000 | Boeing Co. | 5.13 | 02/15/13 |
| 2,439,640 | ||||
| 1,000,000 | Daimler Chrysler NA Holding | 7.40 | 01/20/05 |
| 1,065,549 | ||||
| 600,000 | Ford Motor Co. | 7.25 | 10/01/08 |
| 610,564 | ||||
| 1,000,000 | General Motors Corp. | 6.25 | 05/01/05 |
| 1,042,082 | ||||
| 1,995,000 | General Motors Corp. | 7.10 | 03/15/06 |
| 2,112,769 | ||||
| 1,000,000 | General Motors Corp. | 6.38 | 05/01/08 |
| 1,021,652 | ||||
| 2,000,000 | General Motors Corp. | 7.20 | 01/15/11 |
| 2,040,832 | ||||
|
|
|
|
|
| 10,333,088 | ||||
|
| TOTAL CORPORATE BONDS & NOTES (Cost $68,670,678) |
|
|
| 70,621,438 | ||||
|
| U.S. GOVERNMENT AGENCY SECURITIES--22.4% |
|
|
|
| ||||
|
| Federal Farm Credit Bank--5.2% |
|
|
|
| ||||
| 650,000 | Federal Farm Credit Bank | 6.38 | 11/27/06 |
| 720,541 | ||||
| 1,000,000 | Federal Farm Credit Bank | 3.42 | 03/19/08 |
| 986,492 | ||||
| 1,000,000 | Federal Farm Credit Bank | 6.82 | 03/16/09 |
| 1,134,975 | ||||
| 1,500,000 | Federal Farm Credit Bank | 3.88 | 05/07/10 |
| 1,449,261 | ||||
| 1,500,000 | Federal Farm Credit Bank | 6.03 | 12/29/10 |
| 1,631,811 | ||||
|
|
|
|
|
| 5,923,080 | ||||
|
| Federal Home Loan Bank--10.8% |
|
|
|
| ||||
| 350,000 | Federal Home Loan Bank | 4.45 | 11/27/06 |
| 367,246 | ||||
| 1,000,000 | Federal Home Loan Bank | 6.09 | 06/04/08 |
| 1,035,581 | ||||
| 1,000,000 | Federal Home Loan Bank | 3.75 | 08/15/08 |
| 995,430 | ||||
| 1,500,000 | Federal Home Loan Bank | 3.17 | 10/02/08 |
| 1,449,837 | ||||
| 1,000,000 | Federal Home Loan Bank | 6.25 | 03/01/11 |
| 1,054,572 | ||||
| 1,000,000 | Federal Home Loan Bank | 6.30 | 08/09/11 |
| 1,038,952 | ||||
| 1,000,000 | Federal Home Loan Bank | 5.09 | 10/22/12 |
| 991,336 | ||||
| 2,300,000 | Federal Home Loan Bank | 5.30 | 10/30/12 |
| 2,303,326 | ||||
| 2,000,000 | Federal Home Loan Bank | 5.00 | 11/26/12 |
| 1,975,352 | ||||
| 1,000,000 | Federal Home Loan Bank | 5.35 | 12/24/12 |
| 1,001,003 | ||||
|
|
|
|
|
| 12,212,635 | ||||
Principal | Security Name | Interest | Maturity | Value | ||||||
|
| Federal Home Loan Mortgage Corporation--1.8% |
|
|
|
| ||||
$ | 1,000,000 | Federal Home Loan Mortgage Corporation | 3.50 | 09/15/07 | $ | 1,002,255 | ||||
| 1,000,000 | Federal Home Loan Mortgage Corporation† | 3.00 | 04/15/08 |
| 998,158 | ||||
|
|
|
|
|
| 2,000,413 | ||||
|
| Federal National Mortgage Association--4.6% |
|
|
|
| ||||
| 1,000,000 | Federal National Mortgage Association | 3.76 | 01/30/08 |
| 1,005,177 | ||||
| 1,000,000 | Federal National Mortgage Association | 6.04 | 01/07/09 |
| 1,057,624 | ||||
| 1,070,000 | Federal National Mortgage Association | 4.00 | 10/28/09 |
| 1,047,977 | ||||
| 1,000,000 | Federal National Mortgage Association | 5.68 | 10/07/11 |
| 1,003,577 | ||||
| 1,000,000 | Federal National Mortgage Association | 6.00 | 01/18/12 |
| 1,042,297 | ||||
|
|
|
|
|
| 5,156,652 | ||||
|
| TOTAL U.S. GOVERNMENT AGENCY SECURITIES (Cost $25,523,095) |
|
|
| 25,292,780 | ||||
|
| U.S. TREASURY SECURITIES--9.4% |
|
|
|
| ||||
| 1,000,000 | U.S. Treasury Notes | 6.50 | 08/15/05 |
| 1,088,047 | ||||
| 6,000,000 | U.S. Treasury Notes | 5.88 | 11/15/05 |
| 6,493,362 | ||||
| 1,000,000 | U.S. Treasury Notes | 2.63 | 05/15/08 |
| 968,829 | ||||
| 1,000,000 | U.S. Treasury Notes | 5.75 | 08/15/10 |
| 1,106,094 | ||||
| 1,000,000 | U.S. Treasury Notes | 3.63 | 05/15/13 |
| 940,626 | ||||
|
| TOTAL U.S. TREASURY SECURITIES (Cost $10,358,199) |
|
|
| 10,596,958 | ||||
|
| SHORT-TERM INVESTMENT--4.7% |
|
|
|
| ||||
| 5,274,445 | Monarch Daily Assets Treasury Fund (Cost $5,274,445) |
|
|
| 5,274,445 | ||||
|
| TOTAL INVESTMENTS IN SECURITIES (Cost $109,826,417)--99.0% |
|
|
| 111,785,621 | ||||
|
| Other Assets and Liabilities, Net--1.0% |
|
|
| 1,148,246 | ||||
|
| TOTAL NET ASSETS--100.0% |
|
| $ | 112,933,867 | ||||
† Step rate bond. The maturity date is the effective maturity date; the rate shown is the rate in effect as of August 31, 2003.
BANKNORTH INTERMEDIATE BOND FUND
Principal | Security Name | Interest | Maturity | Value | ||||||
MUNICIPAL BONDS--96.7% | ||||||||||
Indiana--0.3% | ||||||||||
$ | 200,000 | Indianapolis, IN, Public Improvement Project, Series E | 4.50 | 02/01/06 | $ | 211,378 | ||||
|
| Louisiana--0.8% |
|
|
|
| ||||
184,000 | Jefferson Parish, LA, Home Mortgage Authority, SFH RV, FGIC/FHA/VA insured | 7.10 | 08/01/10 | 223,543 | ||||||
165,000 | Lafayette, LA, Public Transportation Financing Authority, SFH RV, FHA/VA insured | 7.20 | 04/01/10 | 187,862 | ||||||
150,000 | Monroe-West Monroe, LA, Public Transportation Financing Authority, SFH RV | 7.20 | 08/01/10 |
| 173,921 | |||||
|
|
|
|
|
| 585,326 | ||||
|
| Puerto Rico--2.8% |
|
|
|
| ||||
2,000,000 | Commonwealth of Puerto Rico, GO Bonds, MBIA-IBC insured | 5.50 | 07/01/09 |
| 2,266,460 | |||||
|
| South Carolina--2.6% |
|
|
|
| ||||
2,000,000 | South Carolina State, School Facilities, GO Bonds, Series A | 4.00 | 01/01/07 |
| 2,114,900 | |||||
|
| Vermont--89.0% |
|
|
|
| ||||
565,000 | Burlington, VT, Airport RV, Series A, MBIA insured | 3.63 | 07/01/17 | 499,302 | ||||||
1,250,000 | Burlington, VT, Airport RV, Series A, MBIA insured | 5.00 | 07/01/23 | 1,242,913 | ||||||
500,000 | Burlington, VT, Electric RV, Series A, MBIA insured | 5.00 | 07/01/04 | 516,765 | ||||||
415,000 | Burlington, VT, GO Bonds, Series A | 5.00 | 12/01/04 | 435,559 | ||||||
800,000 | Burlington, VT, GO Bonds, Series A | 5.10 | 12/01/05 | 865,328 | ||||||
785,000 | Burlington, VT, GO Bonds, Series A | 5.20 | 12/01/06 | 841,457 | ||||||
130,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.50 | 11/01/04 | 133,758 | ||||||
135,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.50 | 11/01/05 | 141,037 | ||||||
135,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.50 | 11/01/06 | 141,553 | ||||||
140,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.50 | 11/01/07 | 146,234 | ||||||
145,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.50 | 11/01/08 | 150,333 | ||||||
150,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.50 | 11/01/09 | 153,555 | ||||||
155,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.50 | 11/01/10 | 155,307 | ||||||
90,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.50 | 11/01/11 | 88,363 | ||||||
170,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.50 | 11/01/12 | 163,724 | ||||||
125,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.60 | 11/01/13 | 119,648 | ||||||
185,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.75 | 11/01/14 | 177,326 | ||||||
190,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 3.75 | 11/01/15 | 179,358 | ||||||
200,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 4.00 | 11/01/16 | 193,222 | ||||||
210,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 4.00 | 11/01/17 | 200,453 | ||||||
220,000 | Burlington, VT, Public Improvement Project, GO Bonds, Series A | 4.00 | 11/01/18 | 206,488 | ||||||
400,000 | Burlington, VT, Waterworks System, Water RV, Series A, FGIC insured | 4.50 | 07/01/04 | 411,780 | ||||||
300,000 | Burlington, VT, Waterworks System, Water RV, Series A, FGIC insured | 4.65 | 07/01/06 | 322,905 | ||||||
150,000 | Burlington, VT, Waterworks System, Water RV, Series A, FGIC insured | 4.75 | 07/01/07 | 163,166 | ||||||
300,000 | Burlington, VT, Waterworks System, Water RV, Series A, FGIC insured | 4.80 | 07/01/08 | 322,647 | ||||||
Principal | Security Name | Interest | Maturity | Value | ||||||
MUNICIPAL BONDS--continued | ||||||||||
Vermont--continued | ||||||||||
$ | 95,000 | Champlain Valley, VT, Union SD No. 15, GO Bonds | 5.00 | 06/01/08 | $ | 95,270 | ||||
145,000 | Champlain Valley, VT, Union SD No. 15, GO Bonds | 5.13 | 06/01/12 | 145,434 | ||||||
110,000 | Chittenden, VT, Solid Waste District, Resource Recovery RV, Series A, AMBAC insured | 2.50 | 01/01/07 | 111,251 | ||||||
100,000 | Chittenden, VT, Solid Waste District, Resource Recovery RV, Series A, AMBAC insured | 3.30 | 01/01/10 | 100,139 | ||||||
310,000 | Chittenden, VT, Solid Waste District, Resource Recovery RV, Series A, AMBAC insured | 3.40 | 01/01/11 | 309,051 | ||||||
205,000 | Chittenden, VT, Solid Waste District, Resource Recovery RV, Series A, AMBAC insured | 3.50 | 01/01/12 | 202,581 | ||||||
90,000 | Fair Haven, VT, Union SD, GO Bonds, AMBAC insured | 4.85 | 12/01/03 | 90,877 | ||||||
90,000 | Fair Haven, VT, Union SD, GO Bonds, AMBAC insured | 4.95 | 12/01/04 | 94,282 | ||||||
90,000 | Fair Haven, VT, Union SD, GO Bonds, AMBAC insured | 5.00 | 12/01/05 | 97,046 | ||||||
90,000 | Fair Haven, VT, Union SD, GO Bonds, AMBAC insured | 5.05 | 12/01/06 | 96,147 | ||||||
25,000 | Norwich, VT, SD, GO Bonds, AMBAC insured | 4.50 | 07/15/09 | 26,998 | ||||||
70,000 | Pawlett/Rupert, VT, Union Elementary SD No. 47, GO Bonds, MBIA insured | 5.00 | 11/01/03 | 70,477 | ||||||
120,000 | Pawlett/Rupert, VT, Union Elementary SD No. 47, GO Bonds, MBIA insured | 5.00 | 11/01/04 | 125,408 | ||||||
30,000 | Shelburne, VT, SD, GO Bonds | 5.00 | 06/01/08 | 30,085 | ||||||
145,000 | Shelburne, VT, SD, GO Bonds | 5.10 | 06/01/10 | 145,431 | ||||||
120,000 | Shelburne, VT, SD, GO Bonds | 5.13 | 06/01/11 | 120,359 | ||||||
135,000 | Shelburne, VT, SD, GO Bonds | 5.13 | 06/01/12 | 135,404 | ||||||
510,000 | St. Johnsbury, VT, SD, GO Bonds, AMBAC insured | 4.50 | 09/01/04 | 527,452 | ||||||
500,000 | St. Johnsbury, VT, SD, GO Bonds, AMBAC insured | 4.50 | 09/01/05 | 530,425 | ||||||
520,000 | St. Johnsbury, VT, SD, GO Bonds, AMBAC insured | 4.55 | 09/01/06 | 560,560 | ||||||
515,000 | St. Johnsbury, VT, SD, GO Bonds, AMBAC insured | 4.65 | 09/01/07 | 560,459 | ||||||
520,000 | St. Johnsbury, VT, SD, GO Bonds, AMBAC insured | 4.80 | 09/01/08 | 570,856 | ||||||
805,000 | University of Vermont & State Agricultural College, Educational Facilities RV, AMBAC insured | 4.10 | 10/01/11 | 826,292 | ||||||
500,000 | University of Vermont & State Agricultural College, Educational Facilities RV, AMBAC insured | 4.20 | 10/01/12 | 511,370 | ||||||
500,000 | University of Vermont & State Agricultural College, Educational Facilities RV, AMBAC insured | 5.50 | 10/01/18 | 539,845 | ||||||
500,000 | University of Vermont & State Agricultural College, Educational Facilities RV, AMBAC insured | 5.50 | 10/01/19 | 536,360 | ||||||
250,000 | University of Vermont & State Agricultural College, Educational Facilities RV, AMBAC insured | 5.25 | 10/01/21 | 259,035 | ||||||
1,150,000 | University of Vermont & State Agricultural College, Educational Facilities RV, AMBAC insured | 5.25 | 10/01/23 | 1,183,005 | ||||||
1,341,250 | Vermont Economic Development Authority, Industrial RV, Tubbs Project1 | 6.18 | 08/31/06 | 1,140,063 | ||||||
Principal | Security Name | Interest | Maturity | Value | ||||||
MUNICIPAL BONDS--continued | ||||||||||
Vermont--continued | ||||||||||
$ | 90,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Champlain College Project, Series A, Merchants Bank, LOC | 5.60 | 10/01/04 | $ | 92,048 | ||||
70,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Landmark College Project, Series A, Remarketed 11/1/94, Vermont National Bank, LOC | 6.20 | 11/01/03 | 70,472 | ||||||
190,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Landmark College Project, Series A, Remarketed 11/1/94, Vermont National Bank, LOC | 7.15 | 11/01/14 | 196,656 | ||||||
4,650,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Marlboro College Project1 | 5.25 | 04/01/19 | 4,488,087 | ||||||
350,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Middlebury College Project | 5.55 | 11/01/03 | 352,755 | ||||||
770,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Middlebury College Project | 5.30 | 11/01/08 | 853,322 | ||||||
190,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Middlebury College Project | 5.38 | 11/01/26 | 195,130 | ||||||
260,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Middlebury College Project, Prerefunded 11/01/03 @ 102 | 5.80 | 11/01/05 | 267,350 | ||||||
160,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Middlebury College Project, Prerefunded 11/01/03 @ 102 | 5.90 | 11/01/06 | 164,550 | ||||||
150,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Middlebury College Project, Prerefunded 11/01/03 @ 102 | 6.00 | 11/01/07 | 154,291 | ||||||
400,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Middlebury College Project, Series A | 4.00 | 11/01/13 | 400,500 | ||||||
3,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, Middlebury College Project, Series A4 | 1.80 | 11/01/27 | 3,017 | ||||||
130,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St. Michaels College Project | 5.30 | 04/01/04 | 133,301 | ||||||
20,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St Michaels College Project | 5.75 | 10/01/04 | 21,014 | ||||||
140,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St. Michaels College Project | 5.40 | 04/01/05 | 149,030 | ||||||
50,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St. Michaels College Project | 3.25 | 10/01/09 | 49,007 | ||||||
100,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St. Michaels College Project | 3.60 | 10/01/10 | 97,278 | ||||||
140,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St. Michaels College Project | 3.88 | 10/01/11 | 136,219 | ||||||
195,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St. Michaels College Project | 4.00 | 10/01/12 | 188,832 | ||||||
125,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St. Michaels College Project | 4.13 | 10/01/13 | 120,617 | ||||||
Principal | Security Name | Interest | Maturity | Value | ||||||
MUNICIPAL BONDS--continued | ||||||||||
Vermont--continued | ||||||||||
$ | 385,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St. Michaels College Project | 4.25 | 10/01/14 | $ | 372,245 | ||||
370,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St. Michaels College Project | 4.38 | 10/01/15 | 357,239 | ||||||
100,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St Michaels College Project, Prerefunded 10/1/04 @ 102 | 5.90 | 10/01/06 | 107,208 | ||||||
1,190,000 | Vermont Educational & Health Buildings Financing Agency, Educational Facilities RV, St Michaels College Project, Prerefunded 10/1/04 @ 102 | 6.50 | 10/01/14 | 1,283,486 | ||||||
430,000 | Vermont Educational & Health Buildings Financing Agency, Healthcare RV, Central Vermont Hospital & Nursing Project, AMBAC insured | 4.25 | 11/15/03 | 432,808 | ||||||
555,000 | Vermont Educational & Health Buildings Financing Agency, Healthcare RV, Central Vermont Hospital & Nursing Project, AMBAC insured | 4.38 | 11/15/04 | 575,430 | ||||||
60,000 | Vermont Educational & Health Buildings Financing Agency, Healthcare RV, Central Vermont Hospital & Nursing Project, AMBAC insured | 4.40 | 11/15/05 | 63,399 | ||||||
605,000 | Vermont Educational & Health Buildings Financing Agency, Healthcare RV, Central Vermont Hospital & Nursing Project, AMBAC insured | 4.50 | 11/15/06 | 645,759 | ||||||
200,000 | Vermont Educational & Health Buildings Financing Agency, Healthcare RV, Central Vermont Hospital & Nursing Project, AMBAC insured | 4.63 | 11/15/07 | 214,684 | ||||||
65,000 | Vermont Educational & Health Buildings Financing Agency, Healthcare RV, Fletcher Allen Health Project, Series A, AMBAC insured | 5.30 | 12/01/08 | 72,023 | ||||||
55,000 | Vermont Educational & Health Buildings Financing Agency, Healthcare RV, Fletcher Allen Health Project, Series A, AMBAC insured | 5.30 | 12/01/09 | 60,805 | ||||||
110,000 | Vermont Educational & Health Buildings Financing Agency, Healthcare RV, Medical Center Hospital of Vermont Project, FGIC insured | 6.00 | 09/01/22 | 112,561 | ||||||
1,346,000 | Vermont Educational & Health Buildings Financing Agency, Healthcare RV, North Country Hospital Project1,2 | 2.17 | 10/01/11 | 1,329,269 | ||||||
150,000 | Vermont Housing Finance Agency, Home Mortgage Program, Series A | 7.75 | 06/15/16 | 150,381 | ||||||
170,000 | Vermont Housing Finance Agency, Home Mortgage Program, Series B, FHA/VA insured2 | 7.40 | 12/01/05 | 171,396 | ||||||
205,000 | Vermont Housing Finance Agency, MFH RV, Series A, HUD/Section 8 insured | 4.45 | 02/15/08 | 211,761 | ||||||
130,000 | Vermont Housing Finance Agency, MFH RV, Series A, HUD/Section 8 insured | 4.55 | 02/15/09 | 132,757 | ||||||
1,025,000 | Vermont Housing Finance Agency, MFH RV, Series B1,3 | 1.30 | 02/15/35 | 1,023,678 | ||||||
10,000 | Vermont Housing Finance Agency, SFH RV, Series 1, Remarketed 7/1/92 | 6.25 | 11/01/03 | 10,031 | ||||||
240,000 | Vermont Housing Finance Agency, SFH RV, Series 11A, FSA insured | 4.60 | 11/01/04 | 247,010 | ||||||
230,000 | Vermont Housing Finance Agency, SFH RV, Series 11A, FSA insured | 4.70 | 11/01/05 | 240,343 | ||||||
325,000 | Vermont Housing Finance Agency, SFH RV, Series 11A, FSA insured | 4.85 | 11/01/06 | 340,918 | ||||||
245,000 | Vermont Housing Finance Agency, SFH RV, Series 11A, FSA insured | 4.95 | 11/01/07 | 256,302 | ||||||
325,000 | Vermont Housing Finance Agency, SFH RV, Series 11A, FSA insured | 5.05 | 11/01/08 | 338,780 | ||||||
430,000 | Vermont Housing Finance Agency, SFH RV, Series 11A, FSA insured | 5.15 | 11/01/09 | 444,538 | ||||||
295,000 | Vermont Housing Finance Agency, SFH RV, Series 12B, FSA insured | 5.50 | 11/01/08 | 310,765 | ||||||
Principal | Security Name | Interest | Maturity | Value | ||||||
MUNICIPAL BONDS--continued | ||||||||||
Vermont--continued | ||||||||||
$ | 385,000 | Vermont Housing Finance Agency, SFH RV, Series 12B, FSA insured | 5.60 | 11/01/09 | $ | 396,758 | ||||
120,000 | Vermont Housing Finance Agency, SFH RV, Series 5 | 5.80 | 11/01/03 | 120,108 | ||||||
75,000 | Vermont Housing Finance Agency, SFH RV, Series 5 | 5.90 | 05/01/04 | 75,235 | ||||||
85,000 | Vermont Housing Finance Agency, SFH RV, Series 5 | 5.90 | 11/01/04 | 85,463 | ||||||
135,000 | Vermont Housing Finance Agency, SFH RV, Series 5 | 6.88 | 11/01/16 | 137,961 | ||||||
135,000 | Vermont Housing Finance Agency, SFH RV, Series 9, MBIA insured | 5.00 | 05/01/05 | 139,971 | ||||||
50,000 | Vermont Housing Finance Agency, SFH RV, Series 9, MBIA insured | 5.10 | 05/01/06 | 52,216 | ||||||
110,000 | Vermont Housing Finance Agency, SFH RV, Series 9, Remarketed 8/26/98, MBIA insured | 4.55 | 05/01/08 | 115,258 | ||||||
1,400,000 | Vermont Housing Finance Agency, Templeton Project1,3 | 1.60 | 04/30/04 | 1,400,210 | ||||||
235,000 | Vermont Municipal Bond Bank, Series 1 | 5.60 | 12/01/03 | 237,611 | ||||||
80,000 | Vermont Municipal Bond Bank, Series 1 | 5.70 | 12/01/04 | 84,259 | ||||||
250,000 | Vermont Municipal Bond Bank, Series 1 | 3.00 | 12/01/07 | 256,150 | ||||||
250,000 | Vermont Municipal Bond Bank, Series 1 | 3.30 | 12/01/08 | 256,740 | ||||||
250,000 | Vermont Municipal Bond Bank, Series 1 | 3.50 | 12/01/09 | 255,637 | ||||||
250,000 | Vermont Municipal Bond Bank, Series 1 | 3.70 | 12/01/10 | 253,490 | ||||||
250,000 | Vermont Municipal Bond Bank, Series 1 | 3.80 | 12/01/11 | 251,062 | ||||||
100,000 | Vermont Municipal Bond Bank, Series 1, AMBAC insured | 4.75 | 12/01/03 | 100,967 | ||||||
30,000 | Vermont Municipal Bond Bank, Series 1, AMBAC insured | 5.10 | 12/01/04 | 31,527 | ||||||
250,000 | Vermont Municipal Bond Bank, Series 1, AMBAC insured | 3.90 | 12/01/12 | 249,315 | ||||||
250,000 | Vermont Municipal Bond Bank, Series 1, AMBAC insured | 4.00 | 12/01/13 | 249,280 | ||||||
1,500,000 | Vermont Municipal Bond Bank, Series 1, FSA insured | 4.30 | 12/01/06 | 1,611,375 | ||||||
1,000,000 | Vermont Municipal Bond Bank, Series 1, FSA insured | 4.40 | 12/01/07 | 1,080,920 | ||||||
860,000 | Vermont Municipal Bond Bank, Series 1, MBIA insured | 4.60 | 12/01/07 | 936,514 | ||||||
100,000 | Vermont Municipal Bond Bank, Series 1, MBIA insured | 4.80 | 12/01/08 | 109,978 | ||||||
340,000 | Vermont Municipal Bond Bank, Series 1, MBIA insured | 4.80 | 12/01/09 | 372,218 | ||||||
50,000 | Vermont Municipal Bond Bank, Series 1, MBIA insured | 3.30 | 12/01/10 | 49,205 | ||||||
520,000 | Vermont Municipal Bond Bank, Series 1, MBIA insured | 3.60 | 12/01/11 | 512,959 | ||||||
550,000 | Vermont Municipal Bond Bank, Series 1, MBIA insured | 3.75 | 12/01/12 | 540,133 | ||||||
500,000 | Vermont Municipal Bond Bank, Series 1, MBIA insured | 3.90 | 12/01/13 | 492,205 | ||||||
2,000,000 | Vermont Municipal Bond Bank, Series 1, MBIA insured | 5.38 | 12/01/16 | 2,159,160 | ||||||
750,000 | Vermont Municipal Bond Bank, Series 2, AMBAC insured | 6.00 | 12/01/04 | 796,192 | ||||||
500,000 | Vermont Municipal Bond Bank, Series 2, AMBAC insured | 5.20 | 12/01/07 | 546,520 | ||||||
165,000 | Vermont Municipal Bond Bank, Series 2, FSA insured | 4.30 | 12/01/06 | 177,251 | ||||||
665,000 | Vermont Municipal Bond Bank, Series 2, FSA insured | 4.40 | 12/01/07 | 718,812 | ||||||
1,000,000 | Vermont Municipal Bond Bank, Series 2, MBIA insured | 5.00 | 12/01/17 | 1,046,930 | ||||||
1,000,000 | Vermont Municipal Bond Bank, Series 2, MBIA insured | 5.00 | 12/01/18 | 1,038,560 | ||||||
100,000 | Vermont Public Power Supply Authority, Power RV, McNeil Project, Series D, AMBAC insured | 4.40 | 07/01/04 | 102,862 | ||||||
Principal | Security Name | Interest | Maturity | Value | ||||||
MUNICIPAL BONDS--continued | ||||||||||
Vermont--continued | ||||||||||
$ | 1,000,000 | Vermont Public Power Supply Authority, Power RV, McNeil Project, Series D, AMBAC insured | 4.50 | 07/01/05 | $ | 1,056,720 | ||||
840,000 | Vermont Public Power Supply Authority, Power RV, McNeil Project, Series E, MBIA insured | 5.00 | 07/01/11 | 911,299 | ||||||
500,000 | Vermont Public Power Supply Authority, Power RV, McNeil Project, Series E, MBIA insured | 5.25 | 07/01/15 | 544,405 | ||||||
1,065,000 | Vermont State, GO Bonds, Series A | 5.00 | 01/15/05 | 1,119,624 | ||||||
50,000 | Vermont State, GO Bonds, Series A | 4.50 | 02/01/05 | 51,122 | ||||||
500,000 | Vermont State, GO Bonds, Series A | 4.40 | 01/15/07 | 535,390 | ||||||
1,600,000 | Vermont State, GO Bonds, Series A | 5.00 | 01/15/08 | 1,731,312 | ||||||
1,300,000 | Vermont State, GO Bonds, Series A | 5.00 | 01/15/10 | 1,393,522 | ||||||
250,000 | Vermont State, GO Bonds, Series A | 4.75 | 08/01/20 | 250,727 | ||||||
2,000,000 | Vermont State, GO Bonds, Series B | 5.00 | 01/15/04 | 2,030,480 | ||||||
1,100,000 | Vermont State, GO Bonds, Series B | 4.30 | 10/15/04 | 1,126,598 | ||||||
1,250,000 | Vermont State, GO Bonds, Series B, Prerefunded 10/15/03 @ 102 | 4.60 | 10/15/07 | 1,279,675 | ||||||
2,750,000 | Vermont State, GO Bonds, Series B, Prerefunded 10/15/03 @ 102 | 4.75 | 10/15/09 | 2,816,192 | ||||||
500,000 | Vermont State, GO Bonds, Series C | 4.60 | 01/15/13 | 519,270 | ||||||
155,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series A-3, FSA insured | 6.25 | 12/15/03 | 157,029 | ||||||
500,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series A-3, FSA insured | 6.40 | 06/15/04 | 511,740 | ||||||
135,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series A-3, FSA insured | 6.40 | 12/15/04 | 138,132 | ||||||
150,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series A-3, FSA insured | 6.50 | 06/15/05 | 153,483 | ||||||
300,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series B, FSA insured | 6.13 | 06/15/04 | 306,804 | ||||||
315,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series B, FSA insured | 6.13 | 12/15/04 | 322,056 | ||||||
480,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series B, FSA insured | 6.25 | 12/15/05 | 490,781 | ||||||
1,095,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series B, FSA insured | 6.35 | 06/15/06 | 1,119,922 | ||||||
120,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series D, FSA insured | 5.30 | 12/15/03 | 121,336 | ||||||
160,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series D, FSA insured | 5.40 | 12/15/04 | 164,818 | ||||||
400,000 | Vermont State, Student Assistance Corp., Educational Loan RV, Financing Program, Series D, FSA insured | 5.60 | 12/15/06 |
| 411,112 | |||||
|
|
|
|
|
| 71,657,756 | ||||
Principal | Security Name | Interest | Maturity | Value | ||||||
MUNICIPAL BONDS--continued | ||||||||||
Wisconsin--1.2% | ||||||||||
$ | 50,000 | Kenosha, WI, GO Bonds, Series B, AMBAC insured | 5.35 | 12/01/03 | $ | 50,559 | ||||
900,000 | Wisconsin State, GO Bonds, Series A | 3.50 | 05/01/05 |
| 931,653 | |||||
|
|
|
|
| 982,212 | |||||
| TOTAL MUNICIPAL BONDS (Cost $76,144,649) |
|
|
| 77,818,032 | |||||
| SHORT-TERM INVESTMENTS--5.3% |
|
|
| ||||||
145,719 | Scudder Tax Free Money Fund |
|
| 145,719 | ||||||
4,143,456 | Dreyfus Municipal Cash Management Plus Fund |
|
| 4,143,456 | ||||||
| TOTAL SHORT-TERM INVESTMENTS (Cost $4,289,175) |
|
| 4,289,175 | ||||||
| TOTAL INVESTMENTS IN SECURITIES (Cost $80,433,824)--102.0% |
|
| 82,107,207 | ||||||
| Other Assets and Liabilities, Net--(2.0%) |
|
|
| (1,609,967) | |||||
|
| TOTAL NET ASSETS--100.0% |
|
| $ | 80,497,240 | ||||
1 Denotes a restricted security which is subject to restrictions on resale under federal securities law. At August 31, 2003, these securities amounted to $9,381,307, which represents 11.7% of Net Assets. Included in these amounts are securities which have been deemed liquid that amounted to $2,423,888, which represents 3.0% of Net Assets.
2 Variable rate security. The rate reported is the rate in effect on August 31, 2003. The date reported is the stated maturity.
3 Denotes a restricted security that has been deemed liquid by criteria approved by the Board of Trustees.
4 These variable rate securities are subject to a put and demand feature. The date reported is the stated maturity.
Notes to Portfolios of Investments
Banknorth Funds
August 31, 2003
The following abbreviations were used in these portfolios:
AMBAC --American Municipal Bond Assurance Corporation
FGIC --Financial Guaranty Insurance Corporation
FHA --Federal Housing Authority
FSA --Financial Security Assurance, Incorporated
GO --General Obligation
HUD --Housing and Urban Development
IBC --Insured Bond Certificates
LOC --Letter of Credit
MBIA --Municipal Bond Insurance Association
MFH --Multi-Family Housing
RV --Revenue Bonds
SD --School District
SFH --Single Family Housing
VA --Veterans Administration
Statements of Assets and Liabilities
Banknorth Funds
August 31, 2003
Banknorth | Banknorth | Banknorth | Banknorth | |||||
Assets: |
|
|
| |||||
Total investments in securities, at value (identified cost $86,703,750, $14,692,277, $109,826,417 and $80,433,824, respectively) | $104,812,853 | $17,410,097 | $111,785,621 | $82,107,207 | ||||
Interest, dividends and other receivables | 129,546 | 20,384 | 1,573,246 | 882,764 | ||||
Receivable for shares sold | 31,469 | -- | 30,000 | -- | ||||
Prepaid expenses | 12,834 | 12,020 | 13,994 | 10,266 | ||||
Total Assets | 104,986,702 | 17,442,501 | 113,402,861 | 83,000,237 | ||||
Liabilities: |
|
|
| |||||
Payable for shares redeemed | 27,384 | 241 | 16,311 | 2,205,799 | ||||
Income distribution payable | -- | -- | 331,542 | 212,781 | ||||
Payable for investment adviser fees | 65,559 | 9,388 | 43,579 | 17,740 | ||||
Payable for administrator fees | 13,112 | 2,167 | 14,526 | 10,644 | ||||
Payable for shareholder services fees | 21,853 | 3,611 | 24,210 | 17,740 | ||||
Payable for transfer agent fees | 6,573 | 1,951 | 3,846 | 3,554 | ||||
Payable for audit fees | 22,278 | 20,139 | 20,260 | 19,763 | ||||
Payable for reporting expenses | 9,418 | 10,324 | 10,768 | 10,985 | ||||
Accrued expenses | 3,316 | -- | 3,952 | 3,991 | ||||
Total Liabilities | 169,493 | 47,821 | 468,994 | 2,502,997 | ||||
Net Assets for (12,310,300, 2,581,708, 10,992,808 and 7,967,194 shares outstanding, respectively) | $104,817,209 | $17,394,680 | $112,933,867 | $80,497,240 | ||||
Net Assets Consist of: |
|
|
| |||||
Paid in capital | $93,552,001 | $14,213,328 | $112,227,962 | $78,864,024 | ||||
Net unrealized appreciation of investments | 18,109,103 | 2,717,820 | 1,959,204 | 1,673,383 | ||||
Accumulated net realized gain (loss) on investments | (6,843,895) | 463,532 | (1,258,669) | (46,101) | ||||
Accumulated undistributed net investment income | -- | -- | 5,370 | 5,934 | ||||
Total Net Assets | $104,817,209 | $17,394,680 | $112,933,867 | $80,497,240 | ||||
Net Asset Value and Redemption Proceeds Per Share | $ 8.51 | $ 6.74 | $ 10.27 | $ 10.10 | ||||
Offering Price Per Share (NAV (1-Maximum Sales Load)) | $ 9.01 | $ 7.13 | $ 10.67 | $ 10.49 | ||||
Maximum Sales Load | 5.50% | 5.50% | 3.75% | 3.75% | ||||
Statements of Operations
Banknorth Funds
Year Ended August 31, 2003
| Banknorth | Banknorth | Banknorth | Banknorth | ||||
Investment Income: | ||||||||
Interest | $ -- | $ -- | $ 6,782,686 | $ 3,398,327 | ||||
Dividend | 1,105,947 | 208,977 | 951 | 45,755 | ||||
Total Investment Income | 1,105,947 | 208,977 | 6,783,637 | 3,444,082 | ||||
Expenses: |
| |||||||
Investment adviser fee (Note 5) | $ 685,587 | $ 132,668 | $ 739,083 | $ 416,575 | ||||
Administrative personnel and services fee (Note 5) | 137,118 | 75,010 | 184,771 | 124,973 | ||||
Custodian fees (Note 5) | 17,609 | 8,092 | 20,143 | 15,352 | ||||
Transfer and dividend disbursing agent fees and expenses (Note 5) | 38,951 | 24,110 | 27,517 | 25,912 | ||||
Directors'/Trustees' fees (Note 5) | 2,785 | 2,245 | 4,462 | 3,421 | ||||
Auditing fees | 24,806 | 19,914 | 20,535 | 20,538 | ||||
Legal fees | 3,603 | 3,401 | 3,540 | 3,534 | ||||
Portfolio accounting fees (Note 5) | 56,937 | 11,267 | 80,429 | 52,597 | ||||
Shareholder services fee (Note 5) | 228,529 | 44,223 | 307,950 | 208,288 | ||||
Share registration costs | 15,115 | 13,861 | 13,725 | 16,521 | ||||
Miscellaneous | 19,416 | 17,323 | 27,008 | 29,355 | ||||
Total Expenses | 1,230,456 | 352,114 | 1,429,163 | 917,066 | ||||
Waivers (Note 5): | ||||||||
Waiver of investment adviser fee | -- | (12,831) | (169,261) | (208,288) | ||||
Waiver of administrative personnel and | -- | (48,476) | -- | -- | ||||
Waiver of shareholder services fee | (9,610) | (2,429) | (15,510) | (10,225) | ||||
Total Waivers | (9,610) | (63,736) | (184,771) | (218,513) | ||||
Net expenses | 1,220,846 | 288,378 | 1,244,392 | 698,553 | ||||
Net Investment Income (Loss) | (114,899) | (79,401) | 5,539,245 | 2,745,529 | ||||
Realized and Unrealized Gain (Loss) |
|
|
|
| ||||
Net realized gain (loss) on investments | (606,504) | 463,581 | 2,410,991 | 15,633 | ||||
Net change in unrealized appreciation (depreciation) of investments | 8,497,809 | 551,528 | (4,675,620) | (1,386,452) | ||||
Net realized and unrealized gain (loss) | 7,891,305 | 1,015,109 | (2,264,629) | (1,370,819) | ||||
Change in Net Assets Resulting From Operations | $7,776,406 | $935,708 | $3,274,616 | $1,374,710 | ||||
Statement of Changes in Net Assets
Banknorth Funds
For the years ended August 31, 2002 and August 31, 2003
| Banknorth | |
Net Assets--August 31, 2001 | $ 43,929,676 | |
Undistributed Net Investment Income August 31, 2001 | -- | |
Operations: |
| |
Net investment income (loss) | (210,854) | |
Net realized gain (loss) on investments | (3,463,067) | |
Net change in unrealized appreciation (depreciation) of investments | (2,280,685) | |
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | (5,954,606) | |
Distributions to Shareholders: |
| |
Distributions from net investment income | -- | |
Distributions from net realized gain on investments | (31,941) | |
CHANGE IN NET ASSETS RESULTING FROM DISTRIBUTIONS TO SHAREHOLDERS | (31,941) | |
Share Transactions: |
| |
Proceeds from sale of shares | 24,085,297 | |
Issuance through Merger (Note 1) | 22,639,706 | |
Net asset value of shares issued to shareholders in payment of distributions declared | 25,121 | |
Cost of shares redeemed | (8,672,970) | |
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS | 38,077,154 | |
Change in net assets | 32,090,607 | |
Net Assets--August 31, 2002 | $ 76,020,283 | |
Undistributed Net Investment Income August 31, 2002 | $ -- | |
Operations: |
| |
Net investment income (loss) | (114,899) | |
Net realized gain (loss) on investments | (606,504) | |
Net change in unrealized appreciation (depreciation) of investments | 8,497,809 | |
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | 7,776,406 | |
Distributions to Shareholders: |
| |
Distributions from net investment income | -- | |
Distributions from net realized gain on investments | -- | |
CHANGE IN NET ASSETS RESULTING FROM DISTRIBUTIONS TO SHAREHOLDERS | -- | |
Share Transactions: |
| |
Proceeds from sale of shares | 35,726,951 | |
Issuance through Merger (Note 1) | 7,783,420 | |
Net asset value of shares issued to shareholders in payment of distributions declared | -- | |
Cost of shares redeemed | (22,489,851) | |
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS | 21,020,520 | |
Change in net assets | 28,796,926 | |
Net Assets--August 31, 2003 | $ 104,817,209 | |
Undistributed Net Investment Income August 31, 2003 | $ -- | |
Banknorth | Banknorth | Banknorth | ||
$ 29,049,848 | $141,864,072 | $ 86,924,414 | ||
-- | 10,673 | 4,890 | ||
|
|
| ||
(205,484) | 6,642,445 | 3,126,207 | ||
2,407,925 | (902,363) | 2,836 | ||
(4,215,015) | 1,932,750 | 355,117 | ||
(2,012,574) | 7,672,832 | 3,484,160 | ||
|
|
| ||
-- | (6,653,064) | (3,127,059) | ||
-- | -- | -- | ||
-- | (6,653,064) | (3,127,059) | ||
|
|
| ||
4,254,362 | 14,584,259 | 7,608,453 | ||
-- | -- | -- | ||
-- | 777,434 | 451 | ||
(10,756,175) | (35,659,137) | (12,758,417) | ||
(6,501,813) | (20,297,444) | (5,149,513) | ||
(8,514,387) | (19,277,676) | (4,792,412) | ||
$20,535,461 | $122,586,396 | $ 82,132,002 | ||
$ -- | $ 54 | $ 4,038 | ||
|
|
| ||
(79,401) | 5,539,245 | 2,745,529 | ||
463,581 | 2,410,991 | 15,633 | ||
551,528 | (4,675,620) | (1,386,452) | ||
935,708 | 3,274,616 | 1,374,710 | ||
|
|
| ||
-- | (5,533,929) | (2,743,633) | ||
(2,335,524) | -- | -- | ||
(2,335,524) | (5,533,929) | (2,743,633) | ||
|
|
| ||
5,981,536 | 17,473,366 | 10,906,820 | ||
-- | -- | -- | ||
547,284 | 651,461 | 456 | ||
(8,269,785) | (25,518,043) | (11,173,115) | ||
(1,740,965) | (7,393,216) | (265,839) | ||
(3,140,781) | (9,652,529) | (1,634,762) | ||
$17,394,680 | $112,933,867 | $ 80,497,240 | ||
$ -- | $ 5,370 | $ 5,934 | ||
Financial Highlights
Banknorth Funds
August 31, 2003
(For a Share Outstanding Throughout Each Period)
Selected Data for a Single Share | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
| ||||||||||||
Beginning | Net | Net Realized | Dividends | Distributions | Ending | |||||||
Banknorth Large Cap Core Fund |
|
|
|
|
|
| ||||||
September 1, 2002 to August 31, 2003 | $ 7.97 | $ (0.01) | $ 0.55 | $ -- | $ -- | $ 8.51 | ||||||
September 1, 2001 to August 31, 2002 | 8.83 | (0.02) | (0.83) | -- | (0.01) | 7.97 | ||||||
June 1, 2001 to August 31, 2001 (f) | 9.61 | (0.01) | (0.77) | -- | -- | 8.83 | ||||||
June 1, 2000 to May 31, 2001 | 12.15 | (0.01) | (1.00) | -- | (1.53) | 9.61 | ||||||
June 1, 1999 to May 31, 2000 | 11.49 | (0.03) | 1.80 | -- | (1.11) | 12.15 | ||||||
June 1, 1998 to May 31, 1999 | 10.13 | (0.01) | 2.31 | --(d) | (0.94) | 11.49 | ||||||
Banknorth Small/Mid Cap Core Fund |
|
|
|
|
|
| ||||||
September 1, 2002 to August 31, 2003 | 7.18 | (0.04) | 0.44 | -- | (0.84) | 6.74 | ||||||
September 1, 2001 to August 31, 2002 | 7.86 | (0.07) | (0.61) | -- | -- | 7.18 | ||||||
October 2, 2000 (e) to August 31, 2001 | 10.00 | (0.08) | (2.04) | -- | (0.02) | 7.86 | ||||||
Banknorth Intermediate Bond Fund |
|
|
|
|
|
| ||||||
September 1, 2002 to August 31, 2003 | 10.49 | 0.48 | (0.22) | (0.48) | -- | 10.27 | ||||||
September 1, 2001 to August 31, 2002 | 10.39 | 0.53 | 0.10 | (0.53) | -- | 10.49 | ||||||
October 2, 2000 (e) to August 31, 2001 | 10.00 | 0.49 | 0.39 | (0.49) | -- | 10.39 | ||||||
Banknorth Vermont Municipal Bond Fund |
|
|
|
|
|
| ||||||
September 1, 2002 to August 31, 2003 | 10.27 | 0.34 | (0.17) | (0.34) | -- | 10.10 | ||||||
September 1, 2001 to August 31, 2002 | 10.22 | 0.38 | 0.05 | (0.38) | -- | 10.27 | ||||||
October 2, 2000 (e) to August 31, 2001 | 10.00 | 0.37 | 0.22 | (0.37) | -- | 10.22 |
(a) Total return calculations do not include sales charges.
(b) The ratio of Gross Expenses to Average Net Assets reflects the expense ratio excluding any
waivers and/or reimbursements (Note 5).
(c) Annualized.
(d) Distributions per share were less than $0.01.
(e) Commencement of operations.
(f) The Fund changed its fiscal year end from May 31 to August 31.
Ratios/Supplemental Data | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|
Ratios to Average Net Assets | ||||||||||
Total | Net Assets At | Net | Net | Gross | Portfolio | |||||
|
|
|
|
|
| |||||
6.78 % | $104,817 | (0.13)% | 1.34% | 1.35% | 59% | |||||
(9.68)% | 76,020 | (0.41)% | 1.43% | 1.48% | 34% | |||||
(8.12)% | 43,930 | (0.43)%(c) | 1.45%(c) | 1.75%(c) | 12% | |||||
(9.04)% | 46,926 | (0.14)% | 1.25% | 1.47% | 26% | |||||
15.96% | 34,398 | (0.21)% | 1.10% | 1.42% | 26% | |||||
24.21% | 32,134 | (0.06)% | 1.10% | 1.44% | 16% | |||||
|
|
|
|
|
| |||||
7.33% | 17,395 | (0.45)% | 1.63% | 1.99% | 73% | |||||
(8.65)% | 20,535 | (0.84)% | 1.49% | 1.69% | 48% | |||||
(21.22)% | 29,050 | (1.06)%(c) | 1.45%(c) | 1.83%(c) | 31% | |||||
|
|
|
|
|
| |||||
2.42% | 112,934 | 4.50 % | 1.01% | 1.16% | 50% | |||||
6.09% | 122,586 | 5.03 % | 0.99% | 1.14% | 11% | |||||
9.12% | 141,864 | 5.28 %(c) | 1.05%(c) | 1.41%(c) | 9% | |||||
|
|
|
|
|
| |||||
1.74% | 80,497 | 3.30 % | 0.84% | 1.10% | 20% | |||||
4.33% | 82,132 | 3.75 % | 0.81% | 1.11% | 7% | |||||
6.00% | 86,924 | 3.96 %(c) | 0.91%(c) | 1.37%(c) | 11% |
Combined Notes to Financial Statements
Banknorth Funds
August 31, 2003
(1) ORGANIZATION
Banknorth Funds (the "Trust") is a Delaware business trust that is registered under the Investment Company Act of 1940, as amended (the "Act"), as an open-end, management investment company. The Trust consists of four portfolios, Banknorth Large Cap Core Fund, Banknorth Small/Mid Cap Core Fund, Banknorth Intermediate Bond Fund and Banknorth Vermont Municipal Bond Fund (each a "Fund" and collectively, the "Funds"). The assets of each portfolio are segregated and a shareholder's interest is limited to the portfolio in which shares are held. The investment objective for Banknorth Large Cap Core Fund and for Banknorth Small/Mid Cap Core Fund is long-term capital appreciation. The investment objective for Banknorth Intermediate Bond Fund is to provide current income. The investment objective for Banknorth Vermont Municipal Bond Fund is to provide current income which is exempt from federal regular income tax and the personal income taxes imposed by the State of Vermont and Vermont municipalities.
On August 27, 2002, Banknorth Large Cap Growth Fund, a series of Banknorth Funds, contributed assets and liabilities for ownership in the Banknorth Large Cap Core Fund, as approved by the Board of Trustees of the Banknorth Funds on August 26, 2002. The net assets of the Banknorth Large Cap Growth Fund were $22,639,706. Each shareholder of the Banknorth Large Cap Growth Fund received 0.676 shares of Banknorth Large Cap Core Fund. The acquisition of net assets and unrealized gain from this transaction was as follows:
Contributing Entry | Date of | Net | Shares | Unrealized | ||||
Banknorth Large Cap Core Fund: | ||||||||
Banknorth Large Cap Growth Fund | August 27, 2002 | $ 22,639,706 | 2,805,682 | $ 1,521,145 |
On March 31, 2003, Banknorth Large Cap Value Fund, a series of Banknorth Funds, contributed assets and liabilities for ownership in the Banknorth Large Cap Core Fund, as approved by the Board of Trustees of the Banknorth Funds on February 13, 2003. The net assets of the Banknorth Large Cap Value Fund were $7,783,420. Each shareholder of the Banknorth Large Cap Value Fund received 0.235 shares of Banknorth Large Cap Core Fund. The acquisition of net assets and unrealized gain from this transaction was as follows:
Contributing Entry | Date of | Net | Shares | Unrealized | ||||
Banknorth Large Cap Core Fund: |
| |||||||
Banknorth Large Cap Value Fund | March 31, 2003 | $7,783,420 | 1,026,972 | $2,303,035 |
(2) SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently followed by the Funds in the preparation of their financial statements. These policies are in conformity with generally accepted accounting principles ("GAAP") in the United States of America.
Investment Valuations--Listed equity securities are generally valued at the last sale price reported on a national securities exchange. United States government securities are generally valued at the mean of the latest bid and asked price as furnished by an independent pricing service. Listed corporate bonds, and other fixed income and asset-backed securities, unlisted securities and short-term securities are valued at the prices provided by an independent pricing service. Municipal bonds are valued by an independent pricing service, taking into consideration yield, liquidity, risk, credit quality, coupon, maturity, type of issue and any other factors or market data the pricing service deems relevant. However, short-term securities with remaining maturities of 60 days or less at the time of purchase may be valued at amortized cost, which approximates fair market value. Investments in other open-end regulated investment companies are valued at net asset value.
Securities for which no quotations are readily available are valued at fair value as determined in good faith using methods approved by the Board of Trustees (the "Trustees").
Investment Income, Expenses and Distributions--Interest income and expenses are accrued daily. Dividend income and distributions to shareholders are recorded on the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at fair value.
Premium and Discount Amortization--All premiums and discounts on fixed income securities are amortized/accreted for financial statement purposes.
Federal Taxes--It is each Fund's policy to comply with the Subchapter M provision of the Internal Revenue Code (the "Code") applicable to regulated investment companies and to distribute to shareholders each year substantially all of its income. Accordingly, no provisions for federal tax are necessary.
When-Issued and Delayed Delivery Transactions--The Funds may engage in when-issued or delayed delivery transactions. The Funds record when-issued securities on the trade date and maintain security positions such that sufficient liquid assets will be available to make payment for the securities purchased. Securities purchased on a when-issued or delayed delivery basis are marked to market daily and begin earning interest on the settlement date. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract.
Restricted Securities--Restricted Securities are securities that may only be resold upon registration under federal securities laws or in transactions exempt from such registration. In some cases, the issuer of restricted securities has agreed to register such securities for resale, at the issuer's expense either upon demand by the Funds or in connection with another registered offering of the securities. Many restricted securities may be resold in the secondary market in transactions exempt from registration. Such restricted securities may be determined to be liquid under criteria established by the Trustees. The Funds will not incur any registration costs upon such resales. The Funds' restricted securities are valued by an independent pricing service or, if no market prices are available, at the fair value as determined in good faith using methods approved by the Trustees.
Additional information on each restricted illiquid security held at August 31, 2003 is as follows:
Banknorth Vermont Municipal Bond Fund:
Security | Acquisition Date | Acquisition Cost | ||
Vermont Economic Development Authority, Industrial RV, Tubbs Project | September 18, 1996 | $ 1,776,324 | ||
Vermont Educational & Health Building Financing | November 7, 1996 | 1,464,045 | ||
Vermont Educational & Health Buildings Financing Agency, | March 22, 1999 | 4,650,101 | ||
Vermont Housing Finance Agency, Templeton Project | February 20, 2003 | 1,400,000 | ||
Vermont Housing Finance Agency, Multi Family, Series B | February 27, 2003 | 1,025,000 |
Use of Estimates--The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets, liabilities, revenues and expenses reported in the financial statements. Actual results could differ from those estimated.
Other--Investment transactions are accounted for on a trade date basis.
(3) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of shares of beneficial interest (without par value) for each Fund.
Transactions in shares were as follows:
Year Ended August 31 | 2003 | 2002 | ||||||
Banknorth Large Cap Core Fund: | Shares | Amount | Shares | Amount | ||||
Shares sold | 4,558,831 | $ 35,726,951 | 2,753,320 | $ 24,085,297 | ||||
Shares issued due to merger (Note 1) | 1,026,972 | 7,783,420 | 2,805,682 | 22,639,706 | ||||
Shares issued to shareholders in payment of distributions declared | -- | -- | 2,819 | 25,121 | ||||
Shares redeemed | (2,816,852) | (22,489,851) | (997,150) | (8,672,970) | ||||
NET CHANGE RESULTING FROM SHARE TRANSACTIONS | 2,768,951 | $ 21,020,520 | 4,564,671 | $ 38,077,154 | ||||
Year Ended August 31 | 2003 | 2002 | ||||||
Banknorth Small/Mid Cap Core Fund: | Shares | Amount | Shares | Amount | ||||
Shares sold | 951,907 | $ 5,981,536 | 558,098 | $ 4,254,362 | ||||
Shares issued to shareholders in payment of distributions declared | 92,918 | 547,284 | -- | -- | ||||
Shares redeemed | (1,322,898) | (8,269,785) | (1,395,928) | (10,756,175) | ||||
NET CHANGE RESULTING FROM SHARE TRANSACTIONS | (278,073) | $ (1,740,965) | (837,830) | $ (6,501,813) | ||||
Year Ended August 31 | 2003 | 2002 | ||||||
Banknorth Intermediate Bond Fund: | Shares | Amount | Shares | Amount | ||||
Shares sold | 1,654,554 | $ 17,473,366 | 1,403,769 | $ 14,584,259 | ||||
Shares issued to shareholders in payment of distributions declared | 61,775 | 651,461 | 74,974 | 777,434 | ||||
Shares redeemed | (2,413,245) | (25,518,043) | (3,440,276) | (35,659,137) | ||||
NET CHANGE RESULTING FROM SHARE TRANSACTIONS | (696,916) | $ (7,393,216) | (1,961,533) | $ (20,297,444) | ||||
Year Ended August 31 | 2003 | 2002 | ||||||
Banknorth Vermont Municipal Bond Fund: | Shares | Amount | Shares | Amount | ||||
Shares sold | 1,057,592 | $ 10,906,820 | 745,061 | $ 7,608,453 | ||||
Shares issued to shareholders in payment of distributions declared | 44 | 456 | 44 | 451 | ||||
Shares redeemed | (1,091,335) | (11,173,115) | (1,251,678) | (12,758,417) | ||||
NET CHANGE RESULTING FROM SHARE TRANSACTIONS | (33,699) | $ (265,839) | (506,573) | $(5,149,513) | ||||
(4) FEDERAL TAX INFORMATION
The timing and character of income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP. These permanent and timing differences are due to the reclassification of net operating losses.
For the year ended August 31, 2003, permanent differences identified and reclassified among the components of net assets were as follows:
| Paid In Capital | Accumulated Net | ||
Banknorth Large Cap Core Fund | $(114,899) | $ 114,899 | ||
Banknorth Small/Mid Cap Core Fund | (79,401) | 79,401 | ||
Banknorth Intermediate Bond Fund | -- | -- | ||
Banknorth Vermont Municipal Bond Fund | -- | -- |
Net investment income and net assets were not affected by this reclassification.
The tax character of distributions as reported on the Statement of Changes in Net Assets for the years ended August 31, 2003 and 2002, were as follows:
Tax-Exempt Income | Ordinary Income | Long-Term Capital | Total | |||||||||||||
For the Year Ended | 2003 | 2002 | 2003 | 2002 | 2003 | 2002 | 2003 | 2002 | ||||||||
Banknorth Large Cap Core Fund | $ -- | $ -- | $ -- | $ -- | $ -- | $ 31,941 | $ -- | $ 31,941 | ||||||||
Banknorth Small/Mid Cap Core Fund | -- | -- | -- | -- | 2,335,524 | -- | 2,335,524 | -- | ||||||||
Banknorth Intermediate Bond Fund | -- | -- | 5,533,929 | 6,653,064 | -- | -- | 5,533,929 | 6,653,064 | ||||||||
Banknorth Vermont | 2,735,844 | 3,127,059 | 7,789 | -- | -- | -- | 2,743,633 | 3,127,059 |
As of August 31, 2003, the components of distributable earnings on a tax basis were as follows:
| Undistributed | Undistributed | Undistributed | Unrealized | ||||
Banknorth Large Cap Core Fund | $ -- | $ -- | $ -- | $ 18,109,103 | ||||
Banknorth Small/Mid Cap Core Fund | -- | -- | 463,532 | 2,717,820 | ||||
Banknorth Intermediate Bond Fund | -- | 5,370 | -- | 1,936,984 | ||||
Banknorth Vermont Municipal Bond Fund | 5,934 | -- | -- | 1,673,383 |
At August 31, 2003, the cost of investments for federal tax purposes, the net unrealized appreciation (depreciation) of investments for federal tax purposes, aggregate gross unrealized appreciation for all securities in which there was an excess of market value over tax cost, and the aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over market value were as follows:
| Tax Cost | Unrealized | Unrealized | Net Unrealized | ||||
Banknorth Large Cap Core Fund | $ 86,703,750 | $ 18,686,938 | $ (577,835) | $ 18,109,103 | ||||
Banknorth Small/Mid Cap Core Fund | 14,692,277 | 2,842,072 | (124,252) | 2,717,820 | ||||
Banknorth Intermediate Bond Fund | 109,848,637 | 4,074,486 | (2,137,502) | 1,936,984 | ||||
Banknorth Vermont Municipal Bond Fund | 80,433,824 | 2,432,047 | (758,664) | 1,673,383 |
The difference between book-basis and tax-basis unrealized appreciation/depreciation is attributable to adjustments for wash sales.
At August 31, 2003 the following Funds had capital loss carryforwards, which will reduce each Fund's taxable income arising from future net realized gain on investments, if any, to the extent permitted by the Code, and thus will reduce the amount of the distributions to shareholders which would otherwise be necessary to relieve each Fund of any liability for federal tax. Pursuant to the Code, such capital loss carryforwards will expire as follows:
| Expiration Year | |||||||
| 2009 | 2010 | 2011 | Total Tax Loss | ||||
Banknorth Large Cap Core Fund | $ 1,541,236 | $ 2,089,186 | $ 3,213,473 | $ 6,843,895 | ||||
Banknorth Small/Mid Cap Fund | -- | -- | -- | -- | ||||
Banknorth Intermediate Bond Fund | -- | 1,236,449 | -- | 1,236,449 | ||||
Banknorth Vermont Municipal Bond Fund | 37,790 | 8,311 | -- | 46,101 |
Under current tax regulations, capital losses realized after October 31 may be deferred and treated as occurring on the first day of the following fiscal year. As of August 31, 2003, for federal income tax purposes, there were no post-October losses.
(5) INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Investment Adviser Fee--Banknorth Investment Advisors, the Funds' investment adviser (the "Adviser"), receives for its services an annual investment adviser fee from each Fund at an annual rate of the Fund's average daily net assets as follows:
Banknorth Large Cap Core Fund | 0.75% | |
Banknorth Small/Mid Cap Core Fund | 0.75% | |
Banknorth Intermediate Bond Fund | 0.60% | |
Banknorth Vermont Municipal Bond Fund | 0.50% |
Effective December 1, 2002 the Adviser agreed to voluntarily waive fees of 0.10%, 0.15% and 0.25% for the Banknorth Small/Mid Cap Core Fund, Banknorth Intermediate Bond Fund and Banknorth Vermont Municipal Bond Fund, respectively. The Adviser can modify or terminate this voluntary waiver at any time at its sole discretion. The Adviser is a division of Banknorth, N.A.
Administration Fee--Federated Services Company ("FServ"), the Funds' administrator, receives for its services an administrative fee based on a scale that ranges from 0.15% to 0.10% of each Fund's average aggregate daily net assets, subject to a $75,000 annual minimum per Fund. FServ may voluntarily choose to waive any portion of its fee. FServ can modify or terminate this voluntary waiver at any time at its sole discretion.
Distribution Services Fee--The Trust has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1 under the Act. Under the terms of the Plan, the Funds will compensate Edgewood Services, Inc. ("Edgewood"), the principal distributor, a distribution fee at an annual rate of 0.25% of the average daily net assets of each Fund. The Plan provides that the Funds may incur distribution expenses of up to 0.25% of the average daily net assets of the Institutional Service Shares, annually, to compensate Edgewood. Edgewood may pay any or all of these payments to various institutions that provide distribution or shareholder services for the Funds. Edgewood has contractually waived the distribution (12b-1) fee for the period ended August 31, 2003.
Shareholder Services Fee--Under the terms of a Shareholder Services Agreement with Federated Shareholder Services Company ("FSSC"), the Funds will pay FSSC up to 0.25% of average daily net assets of each Fund for the period. Due to certain contractual waivers that were in effect, FSSC only received a fee of 0.20% of the average daily net assets of each Fund under the Shareholder Services Agreement through the period ended November 30, 2002. FSSC may pay any or all amounts of these fees to various institutions that provide shareholder servicing to their customers. Effective December 1, 2002, the shareholder servicing agent has chosen to discontinue this waiver.
Transfer and Dividend Disbursing Agent Fees and Expenses--FServ serves as transfer and dividend disbursing agent for the Funds. The fee paid to FServ is based on the size, type and number of accounts and transactions made by shareholders.
Other Service Providers--Forum Accounting Services, LLC ("FAcS") maintains each Fund's accounting records and provides certain financial sub-administration services to the Funds. The fee is based on the level of each Fund's average daily net assets for the period, plus out-of-pocket expenses. In addition, FAcS receives certain surcharges based upon the number of positions held by each Fund. Forum Trust, LLC, the Funds custodian, receives for its services a fee based on the average daily net assets of each Fund, plus an annual maintenance fee per Fund, and certain other transaction charges.
General--Certain of the Officers and Trustees of the Funds are Officers and Directors or Trustees of the above companies.
(6) INVESTMENT TRANSACTIONS
Purchases and sales of investments, excluding long-term U.S. government securities and short-term obligations (and in--kind contributions), for the year ended August 31, 2003, were as follows:
| Purchases | Sales | ||
Banknorth Large Cap Core Fund | $ 68,451,384 | $ 50,476,683 | ||
Banknorth Small/Mid Cap Core Fund | 12,616,652 | 16,327,584 | ||
Banknorth Intermediate Bond Fund | 58,619,303 | 69,468,643 | ||
Banknorth Vermont Municipal Bond Fund | 22,621,259 | 15,666,600 |
(7) CONCENTRATION OF RISK
The Banknorth Vermont Municipal Bond Fund invests a substantial amount of its assets in issuers located in one state and therefore, it is more susceptible to factors adversely affecting issuers of that state than would be a comparable tax-exempt mutual fund that invests nationally. In order to reduce the credit risk associated with such factors, at August 31, 2003, 48% of the securities in the portfolio of investments are backed by letters of credit or bond insurance of various financial institutions and financial guaranty assurance agencies. The percentage of investments insured by or supported (backed) by a letter of credit from any one institution or agency did not exceed 16% of total investments.
(8) FEDERAL INCOME TAX INFORMATION (unaudited)
The amounts of long-term capital gain dividends paid during the period are presented below. For federal income tax purposes, dividends from short-term capital gain are classified as ordinary income. All net investment income dividends were ordinary income, except for those Funds noted below that paid exempt income dividends. The percentage of ordinary income distributions designated as qualifying for the corporate dividends received deduction ("DRD") and the individual qualified dividend rate ("QDI") are also presented below for the applicable Funds.
| Long-Term | Exempt | DRD % | QDI % | ||||
Banknorth Large Cap Core Fund | $ -- | -- | -- | -- | ||||
Banknorth Small/Mid Cap Core Fund | 2,335,524 | -- | -- | -- | ||||
Banknorth Intermediate Bond Fund | -- | -- | -- | -- | ||||
Banknorth Vermont Municipal Bond Fund | -- | 99.72% | -- | -- |
Report of the Independent Auditors
To the Shareholders and Board of Trustees of
BANKNORTH FUNDS:
We have audited the accompanying statements of assets and liabilities of the Banknorth Funds, (comprising the Banknorth Large Cap Core Fund, Banknorth Small/Mid Cap Core Fund, Banknorth Intermediate Bond Fund, and Banknorth Vermont Municipal Bond Fund), (collectively the "Funds") including the schedule of investments, as of August 31, 2003, the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years ended August 31, 2002 and August 31, 2003, and the financial highlights for periods presented. These financial statements and financial highlights are the responsibility of the Funds' management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. 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. Our procedures included confirmation of securities owned as of August 31, 2003, by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. 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 referred to above present fairly, in all material respects, the financial position of the Funds as of August 31, 2003, the results of their operations for the year then ended, the changes in their net assets for each of the two years ended August 31, 2002 and August 31, 2003, and the financial highlights for periods presented, in conformity with accounting principles generally accepted in the United States of America.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
October 17, 2003
Board Of Trustees And Trust Officers (unaudited)
The Board is responsible for managing the Trust's business affairs and for exercising all the Trust's powers except those reserved for the shareholders. The following tables give information about each Board member and the senior officers of the Funds. Where required, the tables separately list Board members who are "interested persons" of the Fund (i.e., "Interested" Board members) and those who are not (i.e., "Independent" Board members). Unless otherwise noted, the address of each person listed is Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh, PA. The Trust comprises four portfolios. Unless otherwise noted, each Officer is elected annually. Unless otherwise noted, each Board member: oversees all portfolios in the Federated Fund Complex; serves for an indefinite term; and also serves as a Board member of the following investment company complexes: Federated Investors Funds--138 portfolios; Golden Oak® Family of Funds--seven portfolios and WesMark Funds--five portfolios. The Funds' Statement of Additional Information includes additional information about Trust's Trustees and is available, without charge and upon request, by calling
1-800-247-4505.
INTERESTED TRUSTEES BACKGROUND
Name | Principal Occupation(s), Other Directorships Held and Previous Position(s) | |
John F. Donahue* | Principal Occupations: Chairman and Director or Trustee of the Federated Fund Complex; | |
J. Christopher Donahue* | Principal Occupations: Principal Executive Officer and President of the Federated Fund Complex; Director or Trustee of some of the Funds in the Federated Fund Complex; President, Chief | |
Lawrence D. Ellis, M.D.* | Principal Occupations: Director or Trustee of the Federated Fund Complex; Professor of Medicine, University of Pittsburgh; Medical Director, University of Pittsburgh Medical Center Downtown; Hematologist, Oncologist and Internist, University of Pittsburgh Medical Center. |
* Family relationships and reasons for "interested" status: John F. Donahue is the father of J. Christopher Donahue; both are "interested" due to the positions they hold with Federated Investors, Inc. and its subsidiaries. Lawrence D. Ellis, M.D. is "interested" because his son-in-law is employed by the Fund's principal underwriter, Federated Securities Corp.
INDEPENDENT TRUSTEES BACKGROUND
Name | Principal Occupation(s), Other Directorships Held and Previous Position(s) | |
Thomas G. Bigley | Principal Occupation: Director or Trustee of the Federated Fund Complex. | |
John T. Conroy, Jr. | Principal Occupations: Director or Trustee of the Federated Fund Complex; Chairman of the Board, Investment Properties Corporation; Partner or Trustee in private real estate ventures in Southwest Florida. | |
Nicholas P. Constantakis | Principal Occupation: Director or Trustee of the Federated Fund Complex. | |
John F. Cunningham | Principal Occupation: Director or Trustee of the Federated Fund Complex. | |
Peter E. Madden | Principal Occupations: Director or Trustee of the Federated Fund Complex; Management Consultant.
|
INDEPENDENT TRUSTEES BACKGROUND (CONT.)
Name | Principal Occupation(s), Other Directorships Held and Previous Position(s) | |
Charles F. Mansfield, Jr. | Principal Occupations: Director or Trustee of the Federated Fund Complex; Management Consultant; Executive Vice President, DVC Group, Inc. (marketing, communications and technology) (prior to 9/1/00). | |
John E. Murray, Jr., J.D., S.J.D. | Principal Occupations: Director or Trustee of the Federated Fund Complex; Chancellor and Law Professor, Duquesne University; Consulting Partner, Mollica & Murray. | |
Marjorie P. Smuts | Principal Occupations: Director or Trustee of the Federated Fund Complex; Public Relations/Marketing Consultant/Conference Coordinator. | |
John S. Walsh | Principal Occupations: Director or Trustee of the Federated Fund Complex; President and Director, Heat Wagon, Inc. (manufacturer of construction temporary heaters); President and Director, Manufacturers Products, Inc. (distributor of portable construction heaters); President, Portable Heater Parts, a division of Manufacturers Products, Inc. |
OFFICERS
Name | Principal Occupation(s), Other Directorships Held and Previous Position(s) | |
Peter J. Germain | Principal Occupation: Senior Vice President, Federated Services Company. |
OFFICERS (CONT.)
Name | Principal Occupation(s), Other Directorships Held and Previous Position(s) | |
John W. McGonigle SECRETARY | Principal Occupations: Executive Vice President and Secretary of the Federated Fund | |
Beth Broderick | Principal Occupation: Vice President, Mutual Fund Services Division, Federated Services Company since 1999. Previous Position: Assistant Vice President, Mutual Fund Services Division, Federated | |
Stephen L. Eddy | Principal Occupations: Senior Vice President and Director, Banknorth, since 2000. Previous Positions: Vice President, Retirement Plan Services, Banknorth, from 1994 to 2000. | |
Judith J. Mackin | Principal Occupations: Vice President and Director of Administration and Business | |
Richard J. Thomas | Principal Occupations: Principal Financial Officer and Treasurer of the Federated Fund Complex; Senior Vice President, Federated Administrative Services. |
[Logo of Banknorth Funds]
Banknorth Large Cap Core Fund
Banknorth Small/Mid Cap Core Fund
Banknorth Intermediate Bond Fund
Banknorth Vermont Municipal Bond Fund
[Logo of Banknorth Funds]
Banknorth Investment Advisors
Investment Adviser
AUGUST 31, 2003
Mutual funds are not bank deposits or obligations, are not guaranteed by any bank, and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other government agency. Investment in mutual funds involves investment risk, including the possible loss of principal.
This report is authorized for distribution to prospective investors only when preceded or accompanied by the fund's prospectus, which contains facts concerning its objective and policies, management fees, expenses and other information.
Banknorth Funds
5800 Corporate Drive
Pittsburgh, PA 15237-7010
Edgewood Services, Inc., Distributor
Investment Company Act File No. 811-10021
Cusip 06646S204
Cusip 06646S501
Cusip 06646S105
Cusip 06646S600
26310 (10/03)