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AMERICAN GENERAL SERIES PORTFOLIO COMPANY 3
AMERICAN GENERAL CORE BOND FUND,
AMERICAN GENERAL MID CAP VALUE FUND,
AMERICAN GENERAL MONEY MARKET FUND,
AMERICAN GENERAL SMALL CAP VALUE FUND
AND
AMERICAN GENERAL SOCIALLY RESPONSIBLE FUND
SUPPLEMENT ISSUED OCTOBER 15, 1998
TO PROSPECTUS DATED SEPTEMBER 21, 1998
American General Core Bond Fund
Effective immediately, Robert N. Kase, CFA, has assumed responsibility for
the portfolio management of the American General Core Bond Fund. Mr. Kase, Vice
President and Senior Portfolio Manager of American General Investment
Management, L.P. (the "Sub-adviser"), joined the Sub-adviser in September 1998.
From September 1992 to July 1998, Mr. Kase was Senior Portfolio Manager at CL
Capital Management, Inc.
American General Mid Cap Value Fund
In addition to Michael M. Kassen and Robert I. Gendelman, S. Basu Mullick
also is primarily responsible for the day-to-day management of American General
Mid Cap Value Fund. Mr. Mullick has been a Vice President of Neuberger & Berman
Management Inc. since October 1998. From 1993 to 1998, Mr. Mullick was a
portfolio manager for another mutual fund manager.
American General Money Market Fund
Effective immediately, the investment policies of American General Money
Market Fund (the "Money Market Fund") are amended to permit investment in
taxable municipal obligations (variable rate demand notes).
Variable rate demand notes ("VRDNs") are obligations containing a floating
or variable interest rate adjustment formula, together with an unconditional
right to demand payment of the unpaid principal balance plus accrued interest
upon a short notice period, generally not to exceed seven days. The Money Market
Fund also may invest in participation VRDNs, which provides the Fund with an
undivided interest in underlying VRDNs held by major investment banking
institutions. Any purchase of VRDNs will meet applicable diversification and
concentration requirements and conditions established by the SEC under which
such securities may be considered to have remaining maturities of 397 days or
less.
American General Small Cap Value Fund
In addition to Kathryn Maag Vorisek, Lloyd J. Spicer, CFA, and Terry B.
French, Douglas G. Madigan, CFA, also is primarily responsible for the
day-to-day management of American General Small Cap Value Fund. Mr. Madigan,
Senior Vice President and Director of Research of Fiduciary Management
Associates, Inc. (the "Sub-adviser"), joined the Sub-adviser in September 1998.
Previously, Mr. Madigan was with Harris Bank as Vice President, Equity Research,
from 1994 to September 1998 and as Mutual Fund Portfolio Manager and Partner
from 1996 to September 1998. From 1989 to 1994, Mr. Madigan was Vice President
and Senior Portfolio Manager at Continental Bank.
American General Socially Responsible Fund
Effective immediately, Maruti D. More' has assumed responsibility for the
portfolio management of the American General Socially Responsible Fund. Mr.
More' has been Vice President -- Investments of American General Series
Portfolio Company 3 since July 1998. Since April 1998, Mr. More' serves as Vice
President of The Variable Annuity Life Insurance Company and American General
Investment Management, L.P. From 1996 to April 1998, Mr. More' was a portfolio
manager with American General Corporation. From 1993 to 1995, Mr. More' was
Managing Director, Marketable Securities at Paul Revere Investment Management
Corporation.
The average annual total return shown on page 33 for the 5 year period
ended March 31, 1998 is 21.54%.
