Item 1. Report to Shareholders
T. Rowe Price Institutional Emerging Markets Equity Fund
Certified Financials
Financial Highlights
T. Rowe Price Institutional Emerging Markets Equity Fund
Certified Financials
(Unaudited)
For a share outstanding
throughout the period
10/31/02
Through
4/30/03
NET ASSET VALUE
Beginning of period $ 10.00
Investment activities
Net investment income (loss) 0.06
Net realized and
unrealized gain (loss) 0.01**
Total from
investment activities 0.07
Distributions
Net investment income (0.01)
NET ASSET VALUE
End of period $ 10.06
Ratios/Supplemental Data
Total return^ 0.70%
Ratio of total expenses to
average net assets 1.10%!
Ratio of net investment
income (loss) to average
net assets 1.49%!
Portfolio turnover rate 56.1%!
Net assets, end of period
(in thousands) $ 7,131
^ Total return reflects the rate that an investor would have earned on an
investment in the fund during the period, assuming reinvestment of all
distributions.
! Annualized
** The amount presented is calculated pursuant to a methodology prescribed by
the Securities and Exchange Commission for a share outstanding throughout
the period. This amount is inconsistent with the fund's aggregate gains and
losses because of the timing of sales and redemptions of fund shares in
relation to fluctuating market values for the investment portfolio.
The accompanying notes are an integral part of these financial statements.
Statement of Net Assets
T. Rowe Price Institutional Emerging Markets Equity Fund
Certified Financials
April 30, 2003 (Unaudited)
Shares Value
- --------------------------------------------------------------------------------
In thousands
BRAZIL 8.3%
Common Stocks 7.1%
Brasil Telecom Participacoes
ADR (USD) 600 $ 21
Companhia de Bebidas ADR (USD) 4,100 82
Companhia Vale do Rio Doce ADR
(1 ADR represents
1 common stock) (USD) 100 3
Companhia Vale do Rio Doce ADR
(1 ADR represents
1 preferred A share) (USD) 2,900 77
Embraer Aircraft ADR (USD) 2,200 30
Grupo Pao de Acucar ADR (USD) 500 7
Petroleo Brasileiro (Petrobras)
ADR (USD) 10,400 178
Tele Norte Leste Participacoes
ADR (USD) 1,300 14
Telebras ADR (USD) 3,590 93
505
Preferred Stocks 1.2%
Banco Bradesco 6,547,898 27
Banco Itau Holding Financeira 918,000 62
89
Total Brazil (Cost $515) 594
CHILE 0.6%
Common Stocks 0.6%
Banco Santander ADR (USD) * 1,954 43
Total Chile (Cost $36) 43
CHINA 1.2%
Common Stocks 1.2%
China Pharmaceutical Enterprise(HKD) 68,000 19
China Telecom Limited (HKD)* 200,000 39
Sinopac (HKD) * 170,000 26
Total China (Cost $85) 84
CZECH REPUBLIC 0.6%
Common Stocks 0.6%
Komercni Banka 595 42
Total Czech Republic (Cost $42) 42
ESTONIA 1.3%
Common Stocks 1.3%
Eesti Telekom GDR (USD) 2,288 $ 45
Hansabank (EUR) 2,400 44
Total Estonia (Cost $75) 89
HONG KONG 2.5%
Common Stocks 2.5%
China Insurance 36,000 18
China Mobile (Hong Kong) 55,500 111
CNOOC 38,000 50
Total Hong Kong (Cost $188) 179
HUNGARY 2.2%
Common Stocks 2.2%
EGIS 701 24
Gedeon Richter 880 64
OTP Bank 6,300 68
Total Hungary (Cost $156) 156
INDIA 4.6%
Common Stocks 4.6%
Bharti Tele-Ventures * 27,000 19
Cipla 1,200 16
HDFC Bank 8,000 42
HDFC Bank ADR (USD) 900 15
Hindustan Lever 14,830 45
Housing Development Finance 5,400 39
I-Flex Solutions 1,800 32
ICICI Bank (Ordinary shares) * 7,780 20
ICICI Bank ADR (USD) * 1,520 8
Infosys Technologies 900 53
Infosys Technologies ADR (USD) 300 13
Ranbaxy Laboratories 1,320 19
State Bank of India 1,000 6
Total India (Cost $370) 327
INDONESIA 0.8%
Common Stocks 0.8%
Telekom Indonesia 114,500 54
Total Indonesia (Cost $45) 54
ISRAEL 3.0%
Common Stocks 3.0%
Check Point Software
Technologies (USD) * 1,295 $ 20
Partner Communications
ADR (USD) * 17,340 77
Teva Pharmaceutical ADR (USD) 2,540 119
Total Israel (Cost $172) 216
MALAYSIA 5.6%
Common Stocks 5.6%
Berjaya Sports Toto 49,400 41
Gamuda Berhad 23,000 31
Genting Berhad 8,000 25
Hong Leong Bank 22,000 24
Magnum 46,000 29
Malayan Banking Berhad 16,400 34
Maxis Communications 38,400 53
Public Bank Berhad 41,000 26
Resorts World 42,000 92
Sime Darby 16,000 21
SP Setia 35,000 20
Total Malaysia (Cost $434) 396
MEXICO 9.0%
Common Stocks 9.0%
America Movil ADR
Series L (USD) 6,800 114
Cemex Participating Certificates
(Represents 2 Series A
and 1 Series B shares) 9,300 42
Coca-Cola Femsa ADR
Series L (USD) 1,700 36
Femsa UBD Units
(Represents 1 Series B
and 4 Series D shares) 10,500 40
Grupo Aeroportuario del Sureste
ADR (USD) 2,200 28
Grupo Financiero BBVA
Bancomer, Series B * 93,300 81
Grupo Modelo, Series C 10,000 22
Grupo Televisa ADR (USD) * 1,324 40
Kimberly-Clark de Mexico
Series A 3,000 7
Telmex ADR, Series L (USD) 4,039 $ 122
Wal-Mart de Mexico 40,300 112
Total Mexico (Cost $609) 644
PERU 0.4%
Common Stocks 0.4%
Compania de Minas Buenaventura
ADR, Series B (USD) 1,150 31
Total Peru (Cost $30) 31
POLAND 1.4%
Common Stocks 1.4%
Bank Polska Kasa Opieki Grupa 1,210 27
Computerland * 400 9
Telekomunikacja Polska * 17,900 60
Total Poland (Cost $98) 96
RUSSIA 8.1%
Common Stocks 8.1%
GMK Norilsk Nickel (USD) 1,100 26
Lukoil (USD) * 2,170 37
Lukoil ADR (USD) 1,830 127
Mobile Telesystems ADR (USD) * 2,000 96
Sberbank RF (USD) 119 27
Sibneft ADR (USD) 900 21
Surgutneftegaz ADR (USD) 2,400 47
Vimpel-Communications
ADR (USD) * 1,600 64
Wimm-Bill-Dann Foods
ADR (USD) * 1,400 26
YUKOS ADR (USD) 610 107
Total Russia (Cost $499) 578
SOUTH AFRICA 9.7%
Common Stocks 9.7%
ABSA Group 19,400 85
AngloGold 1,600 46
FirstRand 47,300 46
Gold Fields 5,000 51
Harmony Gold 3,800 40
Impala Platinum Holdings Limited 1,770 88
Nedcor 8,900 120
New Clicks 57,034 42
Pick 'N Pay Stores 26,400 $ 48
Sanlam 67,310 56
Sasol 3,200 35
Telkom South Africa * 8,100 35
Total South Africa (Cost $717) 692
SOUTH KOREA 18.6%
Common Stocks 17.9%
Hanwha Chemical * 9,130 28
Hyundai Motor 1,000 24
Kookmin Bank 5,550 156
Korea Telecom 900 37
KT Corporation ADR (USD) 2,173 44
Kumgang Korea Chemical
(Ordinary shares) 440 38
Kumgang Korea Chemical
GDR, 144A (USD) * 1,400 22
LG Chemical 1,800 60
Lotte Chilsung Beverage 20 10
Lotte Confectionery 70 25
NCsoft * 530 46
NHN Corporation * 367 33
Pacific Corporation 350 31
POSCO 440 37
Samsung Electronics 1,480 372
Samsung Fire & Marine Insurance * 1,100 54
Shinhan Financial 8,300 82
Shinsegae 260 31
South Korea Telecom 1,060 147
1,277
Preferred Stocks 0.7%
Hyundai Motor 2,040 23
Samsung Electronics 230 28
51
Total South Korea (Cost $1,499) 1,328
SWITZERLAND 0.2%
Common Stocks 0.2%
Compagnie Financiere Richemont 100 2
Compagnie Financiere Richemont
(10 depository receipts
represent 1 A share) (ZAR) 10,900 16
Total Switzerland (Cost $21) 18
TAIWAN 10.8%
Common Stocks 10.8%
Accton Technology * 42,000 $ 28
Advantech 12,000 21
Ambit Microsystems 6,000 17
Basso Industry 17,000 28
Chinatrust Financial Holdings * 102,000 80
Delta Electronics 33,000 37
Evergreen Marine 17,000 10
Formosa Plastic 38,000 47
Fubon Financial Holdings 56,000 38
Hon Hai Precision Industry 6,000 19
Nan Ya Plastic 46,000 40
Oriental Union Chemical 18,000 15
Phoenixtec Power 36,000 28
Quanta Computer 23,000 40
Realtek Semiconductor 7,000 13
Realtek Semiconductor GDR (USD) 1,800 14
SinoPac Holdings * 59,000 18
Taishin Financial Holdings * 69,000 31
Taiwan Semiconductor
Manufacturing 83,000 114
Test Rite International 41,000 26
United Microelectronics 55,000 32
Via Technologies 21,000 24
Wan Hai Lines 65,000 53
Total Taiwan (Cost $887) 773
THAILAND 4.6%
Common Stocks 4.3%
Advanced Info Service
(Ordinary shares) 13,200 14
Advanced Info Services
(Non-Voting Depository
Receipt) 45,500 48
Bangkok Bank (Local shares) * 44,000 54
Kasikornbank Public
(Non-Voting Depository
Receipt) * 50,000 37
Land & Houses 154,000 26
Siam Cement 21,000 59
Siam Commercial Bank
(Foreign Shares) * 86,000 69
307
Preferred Stocks 0.3%
PTT 17,800 $ 20
20
Total Thailand (Cost $309) 327
TURKEY 1.5%
Common Stocks 1.5%
Akbank 5,930,960 21
Anadolu Efes Biracilik
ve Malt Sanayii * 1,495,000 30
Hurriyet Gazete * 9,282,000 21
Migros Turk 2,938,000 26
Turkiye Garanti Bankasi * 10,084,000 12
Total Turkey (Cost $101) 110
UNITED KINGDOM 2.1%
Common Stocks 2.1%
Anglo American (ZAR) 10,200 148
Total United Kingdom (Cost $148) 148
VENEZUELA 0.1%
Common Stocks 0.1%
Compania Anonima Nacional
Telefonos de Venezuela
(CANTV), Series D
ADR (USD) 1,000 10
Total Venezuela (Cost $12) 10
UNITED STATES 2.0%
Money Market Funds 2.0%
T. Rowe Price Reserve
Investment Fund, 1.30% # 139,137 139
Total United States (Cost $139) 139
Total Investments in Securities
99.2% of Net Assets (Cost $7,187) $7,074
Other Assets Less Liabilities 57
NET ASSETS $7,131
------
Net Assets Consist of:
Undistributed net investment income (loss) $35
Undistributed net realized gain (loss) (103)
Net unrealized gain (loss) (112)
Paid-in-capital applicable to 708,586
shares of $0.01 par value capital stock
outstanding 1,000,000,000 shares of
the Corporation authorized 7,311
NET ASSETS $7,131
------
NET ASSET VALUE PER SHARE $10.06
------
# Seven-day yield
* Non-income producing
144A Security was purchased pursuant to Rule 144A under the Securities Act of
1933 and may be resold in transactions exempt from registration only to
qualified institutional buyers-total of such securities at period-end
amounts to $22,000 and represents 0.3% of net assets
ADR American Depository Receipts
EUR Euro
GDR Global Depository Receipts
HKD Hong Kong dollar
USD United States dollar
ZAR South African rand
The accompanying notes are an integral part of these financial statements.
Statement of Operations
T. Rowe Price Institutional Emerging Markets Equity Fund
Certified Financials
(Unaudited)
In thousands
10/31/02
Through
4/30/03
Investment Income (Loss)
Income
Dividend (net of foreign taxes of $5) $ 62
Interest 2
Total income 64
Investment management and administrative expenses 27
Net investment income (loss) 37
Realized and Unrealized Gain (Loss)
Net realized gain (loss)
Securities (97)
Foreign currency transactions (6)
Net realized gain (loss) (103)
Change in net unrealized gain (loss)
Securities (113)
Other assets and liabilities
denominated in foreign currencies 1
Change in net unrealized gain (loss) (112)
Net realized and unrealized gain (loss) (215)
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $ (178)
----------
The accompanying notes are an integral part of these financial statements.
Statement of Changes in Net Assets
T. Rowe Price Institutional Emerging Markets Equity Fund
Certified Financials
(Unaudited)
In thousands
10/31/02
Through
4/30/03
Increase (Decrease) in Net Assets
Operations
Net investment income (loss) $ 37
Net realized gain (loss) (103)
Change in net unrealized gain (loss) (112)
Increase (decrease) in net assets from operations (178)
Distributions to shareholders
Net investment income (2)
Capital share transactions *
Shares sold 7,309
Distributions reinvested 2
Increase (decrease) in net assets from capital
share transactions 7,311
Net Assets
Increase (decrease) during period 7,131
Beginning of period --
End of period $ 7,131
----------
*Share information
Shares sold 708
Distributions reinvested 1
Increase (decrease) in shares outstanding 709
The accompanying notes are an integral part of these financial statements.
Notes to Financial Statements
T. Rowe Price Institutional Emerging Markets Equity Fund
Certified Financials
April 30, 2003 (Unaudited)
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
T. Rowe Price Institutional International Funds, Inc. (the corporation) is
registered under the Investment Company Act of 1940 (the 1940 Act). The
Institutional Emerging Markets Equity Fund (the fund), a diversified, open-end
management investment company, is one of the portfolios established by the
corporation and commenced operations on October 31, 2002. The fund seeks
long-term growth of capital through investments primarily in the common stocks
of companies located (or with primary operations) in emerging markets.
The accompanying financial statements were prepared in accordance with
accounting principles generally accepted in the United States of America, which
require the use of estimates made by fund management.
Valuation
Investments are valued at the close of the New York Stock Exchange (NYSE),
normally 4 p.m. ET, each day that the NYSE is open for business. Equity
securities listed or regularly traded on a securities exchange or in the
over-the-counter market are valued at the last quoted sale price, or official
closing price for certain markets, at the time the valuations are made. A
security that is listed or traded on more than one exchange is valued at the
quotation on the exchange determined to be the primary market for such security.
Listed securities not traded on a particular day are valued at the mean of the
latest bid and ask prices for domestic securities and the last quoted sale price
for international securities.
Investments in mutual funds are valued at the closing net asset value per share
of the mutual fund on the day of valuation.
Other investments and those for which the above valuation procedures are
inappropriate or are deemed not to reflect fair value are stated at fair value
as determined in good faith by or under the supervision of the officers of the
fund, as authorized by the Board of Directors.
Most foreign markets close before the NYSE. Developments that could affect the
values of securities that occur between the close of a foreign market and the
close of the NYSE normally will not be reflected in security valuations.
However, if such developments are so significant that they will, in the judgment
of the officers of the fund, clearly and materially affect the value of
securities, the previous closing prices may be adjusted to reflect the fair
value of the securities as of the close of the NYSE, as determined in good faith
by or under the supervision of the officers of the fund, as authorized by the
Board of Directors.
Currency Translation
Assets, including investments, and liabilities denominated in foreign currencies
are translated into U.S. dollar values each day at the prevailing exchange rate,
using the mean of the bid and ask prices of such currencies against U.S. dollars
as quoted by a major bank. Purchases and sales of securities, income, and
expenses are translated into U.S. dollars at the prevailing exchange rate on the
date of the transaction. The effect of changes in foreign currency exchange
rates on realized and unrealized security gains and losses is reflected as a
component of such gains and losses.
Other
Income and expenses are recorded on the accrual basis. Investment transactions
are accounted for on the trade date. Realized gains and losses are reported on
the identified cost basis. Dividend income and distributions to shareholders are
recorded by the fund on the ex-dividend date.
NOTE 2 - INVESTMENT TRANSACTIONS
Consistent with its investment objective, the fund engages in the following
practices to manage exposure to certain risks or enhance performance. The
investment objective, policies, program, and risk factors of the fund are
described more fully in the fund's prospectus and Statement of Additional
Information.
Emerging Markets
At April 30, 2003, approximately 97% of the fund's net assets were invested in
securities of companies located in emerging markets. Future economic or
political developments could adversely affect the liquidity or value, or both,
of such securities.
Other
Purchases and sales of portfolio securities, other than short-term securities,
aggregated $8,374,000 and $1,229,000, respectively, for the six months ended
April 30, 2003.
NOTE 3 - FEDERAL INCOME TAXES
No provision for federal income taxes is required since the fund intends to
qualify as a regulated investment company and distribute to shareholders all of
its taxable income and gains. Federal income tax regulations differ from
generally accepted accounting principles; therefore, distributions determined in
accordance with tax regulations may differ in amount or character from net
investment income and realized gains for financial reporting purposes. Financial
reporting records are adjusted for permanent book/tax differences to reflect tax
character. Temporary differences are not adjusted. The amount and character of
tax-basis distributions and composition of net assets are finalized at fiscal
year-end; accordingly, tax-basis balances have not been determined as of April
30, 2003.
At April 30, 2003, the cost of investments for federal income tax purposes was
substantially the same as for financial reporting and totaled $7,187,000. Net
unrealized loss aggregated $112,000 at period-end, of which $418,000 related
to appreciated investments and $530,000 related to depreciated investments.
NOTE 4 - FOREIGN TAXES
The fund is subject to foreign income taxes imposed by certain countries in
which it invests. Foreign income taxes are accrued by the fund as a reduction of
income.
Gains realized upon disposition of Indian securities held by the fund are
subject to capital gains tax in India, payable prior to repatriation of sale
proceeds. The tax is computed on net realized gains, and realized losses in
excess of gains may be carried forward eight years to offset future gains. In
addition, the fund accrues a deferred tax liability for net unrealized gains on
Indian securities. At April 30, 2003, the fund had no deferred tax liability.
NOTE 5 - RELATED PARTY TRANSACTIONS
The fund is managed by T. Rowe Price International, Inc. (the manager), a wholly
owned subsidiary of T. Rowe Price Associates, Inc. (Price Associates), which is
wholly owned by T. Rowe Price Group, Inc. The investment management and
administrative agreement between the fund and the manager provides for an
all-inclusive annual fee equal to 1.10% of the fund's average daily net assets.
The fee is computed daily and paid monthly. The agreement provides that
investment management, shareholder servicing, transfer agency, accounting, and
custody services are provided to the fund, and interest, taxes, brokerage
commissions, directors' fees and expenses, and extraordinary expenses are paid
directly by the fund. At April 30, 2003, $12,000 was payable under the
agreement.
The fund may invest in the T. Rowe Price Reserve Investment Fund and T. Rowe
Price Government Reserve Investment Fund (collectively, the Reserve Funds),
open-end management investment companies managed by Price Associates. The
Reserve Funds are offered as cash management options only to mutual funds,
trusts, and other accounts managed by Price Associates and/or its affiliates,
and are not available to the public. The Reserve Funds pay no investment
management fees. Distributions from the Reserve Funds to the fund for the six
months ended April 30, 2003, totaled $2,000 and are reflected as interest income
in the accompanying Statement of Operations.
Item 9. Controls and Procedures
(a) The registrant's Principal Executive Officer and Principal Financial Officer
have evaluated the registrant's disclosure controls and procedures within 90
days of this filing and have concluded that the registrant's disclosure controls
and procedures were effective, as of that date, in ensuring that information
required to be disclosed by the registrant in this Form N-CSR was recorded,
processed, summarized, and reported timely.
(b) At the date of filing this Form N-CSR, the registrant's Principal Executive
Officer and Principal Financial Officer are aware of no significant changes in
the registrant's internal controls or in other factors that could significantly
affect these controls subsequent to the date of their evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
T. Rowe Price Institutional International Funds, Inc.
By /s/ James S. Riepe
James S. Riepe
Principal Executive Officer
Date June 12, 2003
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By /s/ James S. Riepe
James S. Riepe
Principal Executive Officer
Date June 12, 2003
By /s/ Joseph A. Carrier
Joseph A. Carrier
Principal Financial Officer
Date June 12, 2003