Table of Contents (continued)

The Funds are distributed by Victory Capital Advisers, Inc. Victory Capital Management Inc. is the investment adviser to the Funds and receives fees from the Funds for performing services for the Funds.

This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus of the Victory Funds.

For additional information about any Victory Fund, including fees, expenses, and risks, view our prospectus online at www.vcm.com or call 800-539-3863. Read it carefully before you invest or send money.

The information in this annual report is based on data obtained from recognized services and sources and is believed to be reliable. Any opinions, projections, or recommendations in this report are subject to change without notice and are not intended as individual investment advice. Past investment performance of the Funds, markets or securities mentioned herein should not be considered to be indicative of future results.

• NOT FDIC INSURED • NO BANK GUARANTEE • MAY LOSE VALUE

Call Victory at:

800-539-FUND (800-539-3863)

Visit our website at:

www.vcm.com

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Victory Funds Letter to Shareholders
(Unaudited)

Dear Shareholder,

As we turn the page into a new decade, it's hard not to reflect on the fact that we have been enjoying the longest-ever bull market in U.S. equities. The run has been impressive, and despite periods of tumult and plenty of negative news, the bull market endured throughout 2019.

For the annual reporting period ended December 31, 2019, the S&P 500^® Index posted impressive gains of 31.49%. This represents the greatest one-year gain since 2013 and also illustrates a swift bounce-back after a precipitous drop late in 2018. The move higher supports the notion that underlying fundamentals of U.S. companies drive performance, rather than the political rancor and headline fears that often capture the attention of investors.

Perhaps we shouldn't be surprised at the impressive performance of equities. The U.S. economy — the world's largest — remains on solid footing and has been a key driver of both domestic and international stocks. Robust job creation, near-record low unemployment, and steady consumer spending continue and offer reasons for further optimism. Meanwhile, inflation remains muted, and the Federal Reserve (the Fed) and other major global central banks have taken an accommodative stance. In fact, the Fed has cut interest rates by a total of 0.75% over three meetings last July, September and October.

The risk-on attitudes of investors, coupled with the accommodative monetary policy, had an expected impact on U.S. Treasury yields. The 10-year Treasury yield declined significantly over the course of 2019, falling from 2.66% to 1.92% at year-end. More interesting, however, was the fact that, the yield on 10-year Treasurys fell below shorter-term yields for the first time since before the 2007-2008 Global Financial Crisis. This inverted yield curve spooked investors for a spell, only to revert back to a traditional upward sloping yield curve by the end of the year.

The robust domestic economy, low interest rates, and ample liquidity from central banks provided a potent tonic for the stock market in 2019. In fact, at year-end 2019, the S&P 500^® Index was approaching its highest valuation level since 1999. This reminds all of us to retain some historical context on the bull market. Many of us remember the Global Financial Crisis and, before that, the collapse of the dot-com bubble. Although those are now but a distant memory (and we are not forecasting such tumult), we should not forget that stocks don't always go up and cycles don't last forever. In other words, valuations still matter.

The key point is not to discount the risks. In addition to lofty valuations, investors need to keep apprised of trade disputes, geopolitical hotspots, a contentious U.S. election, and a host of other potential headwinds. Yet it is these very risks — these cross-currents — that may create pricing dislocations. This is an environment in which we believe our Victory Capital independent investment franchises can thrive.

On the following pages, you will find information relating to your Victory Funds investment. If you have any questions, we encourage you to contact your financial

advisor. Or, if you invest with us directly, you may call (800) 539-3863, or visit our website at www.vcm.com.

My colleagues and I sincerely appreciate the confidence you have placed in the Victory Funds, and we value the opportunity to help meet your investment goals.

Christopher K. Dyer, CFA

President,

Victory Funds

Victory Fixed Income Funds (Unaudited)

Victory INCORE Investment Quality Bond Fund

Portfolio Holdings

As a Percentage of Total Investments

Commentary

Following a small dip in early October, interest rates and stocks both took a steep trip higher in Q4 concluding an impressive year for both stocks and bonds. Themes driving 2019 returns included an about face on monetary policy by the U.S. Federal Reserve, a global reach for yield driven by negative interest rate policies in Japan and Europe, a resilient U.S. consumer, and easing trade tensions.

Taking its cues from market volatility in late 2018 and early 2019, the Federal Reserve quickly changed course from their December 2018 stance of "auto-pilot" on quantitative tightening, and the need for more interest rate increases in 2019. As the yield curve inverted in Q3, the Federal Reserve responded by lowering the Federal Funds Target Rate by .75% over three meetings. In late Q3 and Q4, repurchase rate volatility inspired the Federal Reserve to end quantitative tightening and instead expand their balance sheet by purchasing $173 billion in U.S. Treasury securities, the bulk of the purchases being in U.S. Treasury bills. Chairman Powell convinced board members to cut rates enough to un-invert the yield curve, and moved them to a low-inflation, rates-lower-for-longer outlook. This policy reversal moved longer term yields lower by nearly 1% for the year, providing the bond market with strong absolute returns in 2019. Negative interest rate policies in Japan and Europe also drove international investors to the U.S. bond market in search of positive yields, and lower rates domestically inspired U.S. investors to reach for yield, providing an even greater boost to corporate bond returns relative to U.S. Treasuries.

The U.S. consumer, not surprisingly, remained confident and seemingly willing to spend. U3 (U.S. official) unemployment rate is at 3.5%, and U6 (broader measure) unemployment rate is at 6.7% and trending lower, and are both at generational lows. The percentage of U.S. workers who perceive jobs as plentiful versus those who perceive jobs as hard to get are at levels not seen since the records set in the late 1990s, and personal income grew 3.9% over the year. This confidence reflected in retail sales which grew at a 5.8% annual rate, ending the year with strong holiday sales and counterbalancing lackluster business investment due to trade tensions, and driving U.S. GDP to grow at 2.3% with inflation running at a benign 1.6%.

Progress in trade negotiations late in the year brightened the outlook for business and investment, moving markets higher at the end of the year. After months of negotiations to modify the USMCA trade deal with Canada and Mexico, the treaty was passed by the House of Representatives in December, and may be ratified by the Senate soon. Progress was also made with China as a Phase 1 trade deal was scheduled to be signed on January 15.

The Victory INCORE Investment Quality Bond Fund (the "Fund") seeks to provide a high level of current income and capital appreciation without undue risk to principal. For the year ended December 31, 2019, the Fund (Class A Shares at net asset value) returned 7.49%, trailing the Bloomberg Barclays U.S. Aggregate Bond Index which returned 8.72%. The bulk of underperformance came from sector allocation in Q1, as we took a cautious stance and entered the year underweight corporate bond exposure and overweight mortgage-backed securities. Interest rate and yield curve positioning were small detractors for the year, as was credit selection.