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Previous: ARCHER DANIELS MIDLAND CO, DEF 14A, 1995-09-13 |
Next: BROWNING FERRIS INDUSTRIES INC, 424B2, 1995-09-13 |
<PAGE>
THE BOND FUND
OF AMERICA
Semi-Annual Report
for the six months ended June 30, 1995
[The American Funds Group(R)]
<PAGE>
The Bond Fund of America(SM)
Seeks as high a level of current income as is consistent with preservation of
capital through a diversified portfolio of bonds and other fixed-income
obligations.
----------------------------------------------------------------
RESULTS AT A GLANCE
(at net asset value with dividends reinvested
for periods ended 6/30/95)
Six months ..............................................+10.6%
Lifetime average annual compound return .................+10.6%
(since 5/28/74)
-----------------------------------------------------------------
Fund results in this report were computed without a sales charge unless
otherwise indicated. Below are the total returns and average annual compound
returns with all distributions reinvested for periods ended June 30, 1995,
assuming payment of the 4.75% maximum sales charge at the beginnning
of the stated periods:
Total Average Annual
Return Compound Return
10 years +153.89% +9.77%
5 years + 54.87% +9.14%
12 months + 5.54% -
Sales charges are lower for accounts of $25,000 or more. The fund's 30-day
yield as of July 31, 1995, calculated in accordance with the Securities and
Exchange Commission formula, was 6.93%. Fund results through August
1988 do not reflect service and distribution expenses now paid under its Plan
of Distribution. Such expenses may not exceed 0.25% of the fund's average
net assets per year and currently amount to approximately 0.25%.
THE FIGURES IN THIS REPORT REFLECT PAST RESULTS. SHARE PRICE AND RETURN WILL
VARY, SO YOU MAY HAVE A GAIN OR LOSS OF PRINCIPAL WHEN YOU SELL YOUR SHARES.
FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR INSURED OR GUARANTEED BY,
THE U.S. GOVERNMENT, ANY FINANCIAL INSTITUTION, THE FEDERAL DEPOSIT INSURANCE
CORPORATION, OR ANY OTHER AGENCY, ENTITY OR PERSON. All investments are subject
to certain risks. For example, those which include bonds are affected by
interest rate fluctuations. High-yield bonds tend to be subject to greater
price swings and default risks than higher rated bonds. Accordingly, investors
should maintain a long-term perspective.
<PAGE>
FELLOW SHAREHOLDERS:
After weathering the worst bond market in its history last year, The Bond Fund
of America rebounded strongly in the first half of 1995.
The value of your investment increased by 10.6% in the past six months if you
reinvested your monthly dividends totaling 52.5 cents a share. If you took
those dividends in cash, your investment rose 6.3% in value in the past six
months. And your income return for the half-year was 4.2% with dividends
reinvested, or 8.4% on an annualized basis. (With dividends in cash, your
income return was 4.1%, or 8.3% annualized.)
Your fund has benefited from the decline in intermediate- and long-term
interest rates so far this year and the consequent rise in bond prices.
Inflation has remained stable and predictions that the economy would overheat
have not come to pass. The bond market's recovery began last November with the
congressional elections. Investors began buying bonds, anticipating increased
fiscal responsibility by the federal government. A slowdown in consumer
spending and reports of a weakening economy continued to fuel
the rise in bond prices.
While yields in the bond market dropped significantly during the first half of
1995, short-term rates remained relatively stable. It was not until July 6,
after the close of the recent fiscal period, that the Federal Reserve lowered
the federal funds rate to 5.75% from 6.0%. It was the first rate decrease after
a series of seven rate increases since February 1994.
The 10.6% total return for the most recent semi-annual period was virtually
equivalent to the average annual total return during the past 20 years of the
fund's operation. Yet BFA's first-half total return this year slightly lagged
the 11.5% first-half total return, with income reinvested, of the Salomon
Brothers Broad Investment-Grade (BIG) Bond Index. With the economy growing at a
very strong pace in late 1994, and with the uncertainties about the strength of
business growth and a possible increase in inflationary pressures, the fund
started the year with an average maturity shorter than the market as a whole.
Thus, it did not benefit fully from the decline in market yields.
[Pull Quote]
The Bond Fund of America rebounded strongly
in the first half of 1995.
[End Pull Quote]
Following the fund's policy of adjusting dividends to reflect current
earnings, the fund's board of directors has voted to lower the fund's monthly
dividend to 8.25 cents a share from 8.75 cents a share effective with the
August 28 payment. Based on the fund's net asset value as of June 30, that
would make the new distribution rate 7.3% compared with the previous rate of
7.8%. The yield on the fund continues to be higher than that of the 30-year
U.S. Treasury bond, which was 6.6% as of June 30.
It is heartening to report that the number of investors in our fund increased
by more than 16,000 in the past six months to 285,537. What makes this
especially gratifying is that it occurred during a time described as a
difficult one for bond fund sales.
The period ahead, in contrast to the 18 months of sharp bond price changes we
have just witnessed, has the potential of being more stable. While we
undoubtedly will experience short-term movements in interest rates and bond
prices, we appear to be in an extended period of moderate inflation that bodes
well for bond prices. Congress seems to be making some progress in dealing with
the budget deficit, which should help to extend that trend.
We will continue to closely monitor the policies of the Federal Reserve, the
rate of inflation and other developments that may affect your fund. We look
forward to reporting to you again in our annual report.
Cordially,
Paul G. Haaga, Jr.
CHAIRMAN OF THE BOARD PRESIDENT
Abner D. Goldstine
PRESIDENT
August 15, 1995
[Pull Quote]
A period of moderate inflation should
bode well for bond prices.
[End Pull Quote]
<PAGE>
THE BOND FUND OF AMERICA
INVESTMENT PORTFOLIO JUNE 30, 1995
(Unaudited)
Corporate Bonds......................................41%
U.S. Treasury Securities.............................26%
Mortgage and Asset-Backed Securities.................21%
Cash Equivalents......................................7%
Non-U.S. Government and Governmental Authorities......5%
<TABLE>
<CAPTION>
Principal Market Percent of
Amount Value Net Assets
(000) (000)
<S> <C> <C> <C>
ELECTRICAL & GAS UTILITIES
UTILITIES: ELECTRICAL & GAS
Big Rivers Electric Corp. 10.70% 2017 $17,000 $19,222 .34
CEZ Finance BV 8.875% 1999 /1/ 7,000 7,560 .13
CMS Energy 0%/9.50% 1997 /2/ 2,000 1,970 .04
Long Island Lighting Co.:
8.90% 2019 5,000 4,587 .08
8.20% 2023 10,000 8,708 .15
United Illuminating Co. 9.76% 2006 5,388 5,657 .10
-------------- ----------
47,704 .84
INDUSTRIAL & SERVICE -------------- ----------
AUTOMOBILES
General Motors Corp.:
9.45% 2011 20,000 23,820 .42
8.80% 2021 52,000 58,899 1.04
-------------- ----------
82,719 1.46
-------------- ----------
BEVERAGES & TOBACCO
Canandaigua Wine Co., Inc. 8.75% 2003 5,000 4,950 .09
Dr Pepper Bottling Co. of Texas 10.25% 2000 8,500 8,797 .15
-------------- ----------
13,747 .24
-------------- ----------
BROADCASTING & PUBLISHING
American Media Operations, Inc. 11.625% 2004 8,500 9,052 .16
Infinity Broadcasting Corp. 10.375% 2002 11,250 11,925 .21
Marvel Holdings Inc. 0% 1998 55,250 38,951 .69
People's Choice TV Corp. 0%/13.125% 2004 /2/ 11,000 5,308 .09
Univision Television Group, Inc.:
11.75% 2001 5,500 5,940 .10
7.00% 2002 3,498 2,099 .04
Young Broadcasting Inc. 10.125% 2005 /1/ 3,000 3,008 .05
-------------- ----------
76,283 1.34
-------------- ----------
CONSTRUCTION & HOUSING
Del Webb Corp. 9.75% 2003 10,000 9,500 .17
Kaufman and Broad Home Corp. 10.375% 1999 7,500 7,594 .13
M.D.C. Holdings, Inc. 11.125% 2003 9,000 8,100 .14
-------------- ----------
25,194 .44
-------------- ----------
DATA PROCESSING & REPRODUCTION
AST Research, Inc. 0% 2013 28,500 9,049 .16
Data General Corp.:
7.75% convertible debentures 2001 8,000 7,280 .13
8.375% 2002 1,250 1,202 .02
Maxtor Corp. 5.75% convertible debentures 2012 2,000 1,185 .02
Neodata Services, Inc. 0%/12.00% 2003 /2/ 13,000 10,920 .19
-------------- ----------
29,636 .52
-------------- ----------
DIVERSIFIED MEDIA & CABLE TELEVISION
Adelphia Communications Corp. 9.50% 2004 3,674 2,902 .05
Bell Cablemedia PLC 0%/11.95% 2004 /2/ 39,500 26,564 .47
Cablevision Industries Corp.:
10.75% 2004 1,000 1,050 .02
9.875% 2013 5,000 5,275 .09
Century Communications Corp.:
9.50% 2000 4,650 4,685 .08
9.75% 2002 4,550 4,607 .08
Comcast Corp.:
10.25% 2001 11,500 12,276 .22
9.375% 2005 4,000 4,020 .07
1.125% convertible debentures 2007 25,000 11,750 .21
Continental Cablevision, Inc.:
8.50% 2001 22,050 22,215 .39
10.625% 2002 4,500 4,770 .08
8.625% 2003 4,000 4,040 .07
8.875% 2005 12,000 12,240 .22
11.00% 2007 3,000 3,330 .06
9.00% 2008 10,000 10,050 .18
9.50% 2013 10,500 10,815 .19
Heartland Wireless Communications, Inc. 13.00% 2003 4,000 4,260 .08
/1/
Insight Communications Co.,LP 8.25% 2000 /3/ 11,250 11,306 .20
International CableTel Inc.:
0%/10.875% 2003 /2/ 9,500 6,222 .11
0%/12.75% 2005 /2/ 17,750 10,561 .19
News America Holdings Inc.:
10.125% 2012 21,000 24,222 .43
9.25% 2013 10,000 11,212 .20
8.625% 2014 A$3,250 1,869 .03
8.45% 2034 10,000 10,854 .19
Rogers Communications Inc. 10.875% 2004 3,500 3,587 .06
Storer Communications, Inc. 10.00% 2003 11,087 10,976 .19
Time Warner Inc.:
9.625% 2002 18,000 20,172 .35
7.75% 2005 8,000 7,942 .14
0% convertible debentures 2012 75,000 25,031 .44
10.15% 2012 10,000 11,687 .21
9.125% 2013 21,000 21,825 .38
TKR Cable I, Inc. 10.50% 2007 27,500 31,508 .55
Turner Broadcasting System, Inc. 0% 2007 /1/ 15,000 6,450 .11
Viacom International Inc.:
9.125% 1999 5,000 5,200 .09
10.25% 2001 2,600 2,873 .05
Videotron Holdings PLC 0%/11.125% 2004 /2/ 20,500 13,427 .24
-------------- ----------
381,773 6.72
-------------- ----------
ELECTRICAL & ELECTRONICS
General Electric Co. 8.625% 2008 3,000 3,442 .06
MagneTek, Inc. 10.75% 1998 7,500 7,875 .14
Samsung Electronics Co., Ltd. 8.50% 2002 /1/ 27,850 29,049 .51
-------------- ----------
40,366 .71
-------------- ----------
ENERGY & RELATED COMPANIES
BP America Inc. 10.00% 2018 4,000 4,516 .08
California Energy Co., Inc. 0%/10.25% 2004 /2/ 38,600 32,810 .58
Global Marine, Inc. 12.75% 1999 4,250 4,675 .08
Mesa Capital Corp. 0%/12.75% 1998 /2/ 6,000 5,430 .10
Midland Cogeneration Venture LP:
10.33% 2002 13,102 13,560 .24
secured lease obligation bonds, 10.33% 2002 7,828 8,102 .14
Occidental Petroleum Corp. 9.25% 2019 12,000 14,533 .26
Oil Co. Ltd. 8.90% 2000 /1/ 13,500 13,727 .24
Oryx Energy Co. 9.50% 1999 3,500 3,657 .06
Subic Power Corp. 9.50% 2008 /1/ 8,146 7,515 .13
TransTexas Gas Corp. 11.50% 2002 6,000 6,120 .11
-------------- ----------
114,645 2.02
-------------- ----------
FOOD RETAILING
Allied Supermarkets Inc. 6.625% 1998 3,590 3,482 .06
Safeway Inc. 10.00% 2002 1,500 1,717 .03
Smith's Food & Drug Centers, Inc., Series 94A2,
0%/8.64% 2012 /2/ 12,000 12,375 .22
Star Markets Co., Inc. 13.00% 2004 1,500 1,470 .03
Stater Bros. Holdings Inc. 11.00% 2001 9,500 9,405 .17
Vons Companies, Inc. 9.625% 2002 8,000 8,360 .15
-------------- ----------
36,809 .65
-------------- ----------
FOREST PRODUCTS & PAPER
Container Corp. of America:
10.75% 2002 3,300 3,416 .06
9.75% 2003 38,000 37,620 .66
11.25% 2004 2,500 2,600 .05
Fort Howard Corp.:
9.25% 2001 7,750 7,634 .13
11.00% 2002 5,151 5,280 .09
10.00% 2003 9,750 9,604 .17
Fort Howard Paper Co.:
8.25% 2002 3,000 2,850 .05
9.00% 2006 6,750 6,142 .11
Grupo Industrial Durango, SA de CV 9.6367% 1996 /1/ /3/ 7,500 6,356 .11
PT Indah Kiat Paper & Pulp Corp.:
11.375% 1999 4,500 4,568 .08
8.875% 2000 1,000 905 .02
8.875% 2000 /1/ 10,135 9,172 .16
P.T. Inti. Indorayon Utama 9.125% 2000 3,000 2,738 .05
Pacific Lumber Co. 10.50% 2003 500 459 .01
Repap Wisconsin 9.875% 2006 12,250 11,852 .21
Riverwood International Corp.:
10.75% 2000 4,500 4,849 .08
Series II 10.75% 2000 1,500 1,605 .03
11.25% 2002 1,000 1,090 .02
Tjiwi Kimia International Finance Co. 13.25% 2001 8,500 9,010 .16
-------------- ----------
127,750 2.25
-------------- ----------
GENERAL RETAILING & MERCHANDISING
Ann Taylor, Inc. 8.75% 2000 2,000 1,960 .03
Barnes & Noble, Inc. 11.875% 2003 10,500 11,655 .21
CompUSA Inc. 9.50% 2000 750 722 .01
Levitz Furniture Corp. 12.375% 1997 8,750 8,837 .16
Thrifty PayLess, Inc.:
11.75% 2003 11,500 12,132 .21
12.25% 2004 14,500 14,899 .26
12.25% 2004 Units 5,000 5,438 .10
-------------- ----------
55,643 .98
-------------- ----------
HEALTH & PERSONAL CARE
FHP International Corp. 7.00% 2003 5,000 4,918 .09
-------------- ----------
LEISURE & TOURISM
Discovery Zone convertible debentures 0% 2013 25,000 8,375 .15
Embassy Suites, Inc. 8.75% 2000 2,000 2,010 .03
Euro Disney SCA 6.75% convertible debentures 2001 108,780 17,951 .32
Foodmaker, Inc.:
9.25% 1999 12,200 11,346 .20
9.75% 2002 8,300 6,972 .12
Four Seasons Hotels Inc. 9.125% 2000 6,000 5,910 .10
Harrah's Jazz Finance Corp. 14.25% 2001 9,750 10,140 .18
Kloster Cruise Ltd. 13.00% 2003 23,750 18,287 .32
Plitt Theatres, Inc. 10.875% 2004 13,000 12,870 .23
-------------- ----------
93,861 1.65
-------------- ----------
MACHINERY & ENGINEERING
Coltec Industries Inc:
9.75% 1999 7,000 7,245 .13
9.75% 2000 7,500 7,763 .14
John Deere Capital Corp. 8.625% 2019 9,150 10,583 .19
NL Industries 11.75% 2003 1,000 1,042 .01
-------------- ----------
26,633 .47
-------------- ----------
METALS
Acme Metals Inc.:
0%/13.50% 2004 /2/ 9,000 6,705 .12
12.50% 2004 4,500 4,455 .08
AK Steel Corp. 10.75% 2004 7,500 7,875 .14
Armco Inc. 11.375% 1999 4,000 4,080 .07
INCO Ltd. 9.60% 2022 5,000 5,441 .10
ISPAT Mexicana:
(Euro) 10.375% 2001 4,650 3,999 .07
10.375% 2001 /1/ 2,000 1,720 .03
Kaiser Aluminum and Chemical Corp.:
9.875% 2002 1,400 1,361 .02
12.75% 2003 18,500 19,887 .35
Pohang Iron & Steel Co., Ltd. 7.375% 2005 10,000 10,206 .18
Tubos de Acero de Mexico, SA 13.750% 1999 /1/ 2,500 2,209 .04
UCAR Global Enterprises Inc. 12.00% 2005 4,000 4,320 .08
USX Corp.:
9.625% 2003 6,000 6,700 .12
0% convertible debentures 2005 40,000 18,400 .32
9.125% 2013 5,000 5,300 .09
-------------- ----------
102,658 1.81
-------------- ----------
MISCELLANEOUS MATERIALS & COMMODITIES
Building Materials Corp. of America 0%/11.75% 2004 4,000 2,360 .04
/2/
Exide Corp. 10.00% 2005 /1/ 8,750 8,991 .16
Hyster-Yale Materials Handling, Inc. 12.375% 1999 447 478 .01
Owens-Illinois, Inc. 11.00% 2003 5,000 5,487 .09
Tolmex, SA de CV 8.375% 2003 5,500 3,795 .07
-------------- ----------
21,111 .37
-------------- ----------
Multi-Industry
Hanson America, Inc. 144A 2.39% convertible
debentures 2001 /1/ 40,000 31,850 .56
Swire Pacific Ltd. 8.50% 2004 /1/ 20,000 21,150 .37
Tenneco Inc. 7.875% 2002 3,000 3,151 .06
-------------- ----------
56,151 .99
-------------- ----------
OTHER
ADT Operations 9.25% 2003 2,500 2,581 .04
ASH Capital Finance, Ltd. 9.50% 2006 pound 4,500 5,018 .09
Protection One Alarm Monitoring, Inc. 0%/13.625% $10,000 6,625 .12
2005 /1/ /2/
-------------- ----------
14,224 .25
-------------- ----------
TELECOMMUNICATIONS
CellNet Data Systems, Inc. 0%/13.00% 2005 /1/ /2/ 25,000 13,375 .23
Cellular, Inc. 0%/11.75% 2003 /2/ 10,500 7,770 .14
CenCall Communications Corp. 0%/10.125% 2004 /2/ /4/ 32,500 16,250 .29
Centennial Cellular Corp. 8.875% 2001 19,000 17,860 .31
Comcast Cellular Corp.:
Series A, 0% 2000 23,500 16,685 .29
Series B, 0% 2000 29,400 20,874 .37
Commnet Cellular Inc. 11.25% 2005 5,500 5,500 .10
Dial Call Communications, Inc. 0%/12.25% 2004 /2/ /4/ 37,750 18,498 .32
Geotek Communications, Inc. 15.00% 2005 /1/ 8,750 4,230 .07
GTE Corp. 8.85% 1998 9,500 10,024 .18
Horizon Cellular Telephone Co., LP 0%/11.375% 2000 15,500 12,245 .22
/2/
MFS Communications Co., Inc. 0%/9.375% 2004 /2/ 42,500 29,538 .52
MobileMedia Communications, Inc. 0%/10.50% 2003 /2/ 14,600 9,709 .17
NEXTEL Communications, Inc.: /4/
0%/11.50% 2003 /2/ 56,000 31,080 .55
0%/9.75% 2004 /2/ 59,000 28,025 .49
Northern Telecom Ltd. 8.75% 2001 3,500 3,846 .07
Paging Network, Inc. 11.75% 2002 13,675 14,632 .26
PanAmSat, LP PanAmSat Capital Corp. 9.75% 2000 10,150 10,353 .18
PriCellular Wireless Corp. 0%/14.00% 2001 /2/ 6,000 4,830 .09
Rogers Cantel Mobile Communications Inc. 10.75% 2001 39,475 40,857 .72
-------------- ----------
316,181 5.57
-------------- ----------
TEXTILES & APPAREL
VF Corp. 9.25% 2022 4,000 4,396 .08
WestPoint Stevens Inc. 8.75% 2001 2,500 2,462 .04
-------------- ----------
6,858 .12
-------------- ----------
TRANSPORTATION
Air Wis Services, Inc. 7.75% convertible debentures 4,000 2,920 .05
2010
Alaska Air Lyon 0% convertible debentures 2006 23,750 10,984 .19
Alaska Airlines:
Series A, 9.50% 2010 2,461 2,518 .04
Series B, 9.50% 2010 3,092 3,163 .06
Series C, 9.50% 2010 3,002 3,044 .05
Series D, 9.50% 2012 4,990 5,113 .09
American Airlines, Inc., 1991-A, mortgage
pass-through
certificates, 9.71% 2007 /5/ 9,331 10,361 .18
AMR Corp.:
10.40% 2011 13,000 15,578 .27
10.42% 2011 5,000 5,999 .11
9.00% 2012 7,500 7,922 .14
Delta Air Lines, Inc.:
9.875% 2000 2,000 2,198 .04
10.375% 2011 2,500 2,897 .05
Delta Air Lines, Inc., pass-through certificates:
Series 1992-A2, 9.20% 2014 /5/ 9,000 9,652 .17
Series 1992-B1, 9.375% 2007 /5/ 9,408 10,117 .18
Series 1993-A2, 10.50% 2016 /5/ 12,500 14,522 .25
Series 1993-B2, 10.06% 2016 /5/ 2,000 2,230 .04
Series 1993-C2, 9.59% 2017 /5/ 5,000 5,509 .10
1990 Equipment trust certificates:
Series J, 10.00% 2014 /1/ 5,000 5,000 .09
Seriies I, 10.00% 2014 /1/ 8,000 8,890 .16
Series F, 10.79% 2014 /1/ 1,700 1,991 .04
Federal Express Corp. 8.40% 2010 10,000 10,525 .19
Mc Cuernavaca Trust 9.25% 2001 /1/ 4,467 3,216 .06
Northwest Airlines, Inc. 12.0916% 2000 8,462 8,716 .15
NWA Inc. 8.625% 1996 2,000 2,010 .04
TNT Transport (Euro) PLC/TNT (USA) Inc. 11.50% 2004 4,750 4,798 .08
United Air Lines, Inc.:
10.67% 2004 16,500 19,009 .33
United Air Lines, Inc.
pass-through certificates:
Series 1993-A3, 8.39% 2011 /5/ 7,500 7,631 .13
Series 1995-A1, 9.02% 2012 /5/ 9,000 9,528 .17
Viking Star Shipping Inc. 9.625% 2003 7,000 6,982 .12
-------------- ----------
203,023 3.57
-------------- ----------
FINANCE
BANKING & THRIFTS
Banco de Galicia y Buenos Aires SA 9.00% 2003 2,000 1,420 .03
Banco Ganader 9.75% 1999 4,500 4,506 .08
Bank of Scotland 8.80% 2004 /1/ 16,000 17,765 .31
Bankers Trust New York Corp.:
8.25% 2005 3,000 3,192 .06
6.00% 2008 10,000 8,792 .15
Capital One Bank:
8.33% 1997 10,000 10,250 .18
8.125% 1998 10,000 10,282 .18
Chevy Chase Savings Bank, F.S.B. 9.25% 2005 2,500 2,425 .04
Coast Federal Bank 13.00% 2002 5,000 5,625 .10
Coast Savings Financial, Inc. 10.00% 2000 6,500 6,662 .12
Den Danske Bank Aktieselskab 7.25% 2005 /1/ 5,500 5,459 .10
First Nationwide:
12.25% 2001 9,000 9,540 .17
10.00% 2006 5,850 6,611 .12
Midland American Capital 12.75% 2003 12,150 14,368 .25
New American Capital, Inc. 9.60% 1999 /1/ 15,000 15,694 .28
Skandinaviska Enskilda Banken (N.Y. City) 6.875% 14,000 13,398 .23
2009
State Bank of New South Wales Euronotes 10.375% 1999 3,000 3,388 .06
-------------- ----------
139,377 2.46
-------------- ----------
FINANCIAL SERVICES
Beneficial Corp. 12.875% 2013 3,800 4,610 .08
Ford Motor Credit Co. 9.50% 2000 7,350 8,223 .14
General Electric Capital Corp. 8.875% 2009 8,000 9,433 .17
General Motors Acceptance Corp.:
7.00% 2000 5,000 5,057 .09
9.625% 2001 3,000 3,415 .06
8.75% 2005 10,000 11,180 .20
8.875% 2010 2,500 2,877 .05
-------------- ----------
44,795 .79
-------------- ----------
INSURANCE
American Re Corp. 10.875% 2004 46,000 51,083 .90
CIGNA Corp. 6.375% 2006 15,000 13,807 .24
Fairfax Financial Holdings Ltd. 7.75% 2003 7,750 7,605 .13
Fidelity National Financial 0% 2009 20,000 7,500 .13
-------------- ----------
79,995 1.40
-------------- ----------
REAL ESTATE
B.F. Saul REIT 11.625% 2002 20,000 18,900 .33
Beverly Finance Corp. 8.36% 2004 /1/ 15,000 15,799 .28
Corporate Property Investors 9.00% 2002 /1/ 2,000 2,213 .04
ERP Operating Limited Partnership 7.95% 2002 6,750 6,978 .12
Security Capital Industrial Trust 7.875% 2009 6,250 6,344 .11
Shopping Center Associates 6.75% 2004 /1/ 7,500 7,219 .13
Wharf Capital International, Ltd. 8.875% 2004 15,000 15,542 .27
-------------- ----------
72,995 1.28
-------------- ----------
COLLATERALIZED MORTGAGE/ASSET-BACKED OBLIGATIONS /5/
(Excluding Those Issued by Federal Agencies)
Capstead Securities Corp. IV, collateralized
mortgage
obligations, Series 1992-4, Class J, 24.231% 2022 /6/ 8,750 8,488 .15
Case Equipment Loan Trust 1995-A 7.30% 2002 4,839 4,911 .09
Chase Manhattan Bank, N.A., Series 93-I, Class 2A5,
7.25% 2024
2024 10,000 9,733 .17
CMC Securities Corp., collateralized mortgage
obligations, Series 1992-A, Class 10, 11.1085% 2022 3,913 2,348 .04
/6/
Countrywide Funding Corp., Series 94-2, Class A-12,
6.6481% 2009 /5/ 5,206 3,046 .05
CSFB Finance Co. Ltd. 7.00% 2005 /3/ 30,000 29,625 .52
Electronic Transfer Master Trust 9.35% 2002 /1/ 18,000 18,284 .32
GCC Home Equity Trust, asset-backed certificates,
Series
1990-1, 10.00% 2005 4,793 5,027 .09
G E Capital Mortgage Services:
Series 1994-15, Class A10, 6.00% 2009 16,376 14,575 .26
Series 1995-1, Class A8, 8.40% 2025 21,785 22,357 .39
Green Tree Financial Corp., pass-through
certificates:
Series 1994-A, Class NIM, 6.90% 2004 3,695 3,651 .06
Series 1993-2, Class B, 8.00% 2018 2,250 2,258 .04
Jet Equipment Trust:
Series 1994-A, 10.91% 2006 /1/ 6,989 7,680 .14
Series 1995-A, 10.69% 2015 /1/ 10,500 11,340 .20
MBNA Credit Card Trust, asset-backed certificates,
Series
1991-1, 7.75% 1998 6,000 6,101 .11
Prudential Home Mortgage Securities Co., Inc.:
Series 1993-7, Class A-4, 8.00% 2003 9,323 9,454 .17
Series 1993-7, Class A-5, 8.00% 2003 6,486 6,514 .11
Series 1993-48, Class A-6, 6.25% 2008 4,466 4,153 .07
Series 1992-46, Class A-13, 8.1737% 2008 /6/ 4,431 2,709 .05
Series 1992-37, Class A-6, 7.00% 2022 2,500 2,502 .04
Residential Funding Mortgage Securities I, Inc.,
Series
1992-S6, Class A-10, 13.209% 2022 /6/ 10,124 8,302 .15
Resolution Trust Corp.:
Series 1991-M5, Class B, 9.00% 2017 2,768 2,847 .05
Series 1992-6, Class A-2B, 8.40% 2024 10,602 10,681 .19
Series 1993-C1, Class D, 9.45% 2024 9,352 9,668 .17
Series 1993-C1, Class E, 9.50% 2024 891 880 .02
Series 1993-C2, Class C, 8.00% 2025 3,000 3,030 .05
Series 1993-C2, Class D, 8.50% 2025 3,290 3,360 .06
Series 1993-C2, Class E, 8.50% 2025 1,040 1,027 .02
Ryland Mortgage Securities Corp., Series 1991-14,
Class F, 23.1885% 2021 /6/ 1,070 1,112 .02
Sears Credit Account Trust, Series 1991-C, 8.65% 20,000 20,475 .36
1998
SKW II Real Estate L.P.:
6.45% 2002 /1/ 1,994 1,994 .04
6.90% 2002 /1/ 4,646 4,646 .08
Standard Credit Card Master Trust I, credit card
participation certificates:
Series 1991-1A, 8.50% 1997 20,500 20,923 .37
Series 1994-2A, 7.25% 2008 5,000 5,169 .09
Standard Credit Card Trust, credit card
participation
certificates:
Series 1990-3A, 9.50% 1998 5,000 5,269 .09
Series 1990-6A, 9.375% 1998 7,000 7,385 .13
Series 1991-3A, 8.875% 1999 11,000 11,691 .20
Travelers Mortgage Services, Inc., pass-through
certificates, Series 1989-9, Class Z-2, 8.80% 2019 932 932 .02
-------------- ----------
294,147 5.18
-------------- ----------
GOVERNMENTAL
GOVERNMENTS (EXCLUDING U.S. GOVERNMENT)
Argentina (Republic of):
8.375% 2003 13,000 9,588 .17
Eurobond 7.1325% 2005 /3/ 11,500 7,073 .12
Eurobond 5.00% 2023 /3/ 7,500 3,572 .06
Argentina Bocon 7.268% 2001 /3/ 17,000 9,311 .16
Brazil (Republic of):
Debt Conversion Bond 7.3125% 2012 /3/ 2,000 1,040 .02
4.00% 2024 2,000 893 .02
British Columbia Hydro & Power Authority:
15.50% 2011 17,000 19,598 .35
15.50% 2011 11,967 14,117 .25
12.50% 2013 4,000 4,825 .08
12.50% 2014 7,000 8,517 .15
Canadian Government:
9.25% 1996 C$46,250 34,563 .61
10.50% 2001 5,000 4,110 .07
9.00% 2004 37,750 29,364 .52
4.524% 2021 2,000 1,470 .03
Italian Government National:
8.50% 1999 ITL5,000,000 2,709 .05
8.50% 2004 7,200,000 3,528 .06
8.50% 2004 16,650,000 8,114 .14
Italy (Republic of):
6.00% 2003 $2,750 2,589 .05
6.875% 2023 36,000 31,955 .56
Netherlands Government DFL 7.50% 2023 FL5,000 3,205 .06
New South Wales Treasury 6.50% 2006 A$3,000 1,748 .03
Nova Scotia (Province of):
7.25% 2013 $4,000 3,897 .07
11.50% 2013 2,212 2,562 .05
Ontario (Province of):
7.75% 2002 3,500 3,719 .07
17.00% 2011 11,250 13,450 .24
15.25% 2012 6,985 8,573 .15
11.50% 2013 5,000 5,761 .10
Petroleo Brasileiro S.A. 9.275% debentures 1998 /3/ 7,500 7,388 .13
Poland (Republic of):
7.75% 2000 /1/ 7,500 7,509 .13
Discount Bond 7.125% 2024 /3/ 750 578 .01
Past Due Interest Bond 3.25% 2014 /3/ 2,000 1,200 .02
Quebec (Province of) 13.25% 2014 5,500 6,922 .12
Queensland Global Treasury Note:
8.00% 2001 A$17,000 11,509 .20
12.00% 2001 5,000 4,055 .07
United Mexican States Government Eurobonds:
Series A, 6.25% 2019 $1,000 610 .01
Series B, 6.25% 2019 6,500 3,965 .07
-------------- ----------
283,587 5.00
-------------- ----------
DEVELOPMENT AUTHORITIES
Inter-American Development Bank 8.875% 2009 10,000 12,143 .21
International Bank for Reconstruction & Development 2,500 2,888 .05
14.90% 1997
-------------- ----------
15,031 .26
-------------- ----------
FEDERAL AGENCY OBLIGATIONS - MORTGAGE PASS-THROUGHS
/5/
Federal Home Loan Mortgage Corp:
8.00% 2003-2010 8,168 8,348 .15
8.25% 2007 3,740 3,829 .07
8.50% 2002-2020 15,517 16,012 .28
8.75% 2008 4,842 5,013 .09
9.00% 2021 1,456 1,518 .03
10.00% 2011-2019 861 928 .02
10.50% 2020 3,920 4,236 .07
10.75% 2010 157 169 .00
11.50% 2000 53 56 .00
12.00% 2010-2015 2,296 2,496 .04
12.50% 2009-2019 2,547 2,834 .05
12.75% 2015-2019 871 968 .02
13.00% 2014 79 88 .00
13.50% 2018 18 20 .00
13.75% 2014 32 35 .00
Federal National Mortgage Assn.:
7.50% 2009-2024 20,278 20,468 .36
8.00% 2023 3,857 3,927 .07
8.50% 2022-2023 8,488 8,801 .15
9.00% 2018-2025 11,712 12,212 .22
9.50% 2019 1,032 1,084 .02
10.00% 2019 1,065 1,156 .02
10.50% 2012 5,106 5,566 .10
11.00% 2015-2020 4,959 5,418 .10
11.25% 2014 96 105 .00
11.50% 2010-2014 433 474 .01
12.00% 2015-2019 195 214 .00
12.50% 2015 477 529 .01
13.00% 2014 67 75 .00
13.25% 2015 28 31 .00
15.00% 2013 92 104 .00
Government National Mortgage Assn.:
5.00% 2024 /3/ 55,532 55,348 .97
5.50% 2023-2024 /3/ 160,790 158,975 2.80
6.00% 2022-2024 /3/ 40,579 41,006 .72
6.125% 2022 10,497 10,586 .19
6.50% 2008-2009 5,000 4,944 .09
7.00% 2008-2025 80,347 79,458 1.40
7.50% 2007-2024 89,375 90,098 1.58
8.00% 2017-2025 14,886 15,250 .27
8.50% 2020-2025 15,944 16,552 .29
9.00% 2016-2025 29,427 30,905 .54
9.50% 2017-2020 20,337 21,591 .38
10.00% 2017-2019 3,409 3,709 .07
10.50% 2015-2019 1,173 1,293 .02
11.00% 2013-2016 1,922 2,136 .04
11.50% 2015 81 91 .00
12.00% 2014 188 207 .00
12.50% 2010-2015 1,250 1,418 .02
13.25% 2014 111 122 .00
-------------- ----------
640,403 11.28
-------------- ----------
FEDERAL AGENCY OBLIGATION - OTHER
Federal Home Loan Bank Bonds:
6.16% 2004 24,000 22,955 .40
6.27% 2004 5,000 4,805 .08
6.38% 2003 3,000 2,910 .05
6.41% 2003 8,580 8,296 .15
7.28% 2000 6,000 5,997 .11
8.23% 2004 5,000 5,079 .09
Federal Home Loan Mortgage Notes:
5.74% 2003 6,500 6,110 .11
5.78% 2003 12,175 11,460 .20
6.185% 2003 19,100 18,384 .32
6.19% 2004 6,000 5,746 .10
6.24% 2003 2,900 2,787 .05
6.27% 2004 2,500 2,402 .04
6.28% 2003 3,000 2,894 .05
6.30% 2003 2,000 1,935 .03
6.375% 2003 5,820 5,647 .10
6.39% 2003 10,330 10,037 .18
6.50% 2003 6,200 6,038 .11
7.12% 2003 15,000 14,858 .26
7.29% 2004 6,000 5,997 .11
Federal National Mortgage Association Notes 6.30% 5,000 5,005 .09
1997
Federal National Mortgage Association, medium-term
note,
6.14% 2004 13,000 12,415 .22
FNSM Callable Principal STRIPS 0%/8.25% 2022 /2/ 4,500 3,555 .06
-------------- ----------
165,312 2.91
-------------- ----------
COLLATERALIZED MORTGAGE OBLIGATIONS - FEDERAL
AGENCIES /5/
Federal Home Loan Mortgage Corp.:
Series 1604, Class SA, 5.7118% 2008 /6/ 2,000 1,293 .02
Series 1625, Class SC, 5.7008% 2008 /6/ 3,000 1,820 .03
Series 1712, Class D, 6.00% 2009 7,500 6,809 .12
Series 1716, Class A, 6.50% 2009 4,750 4,596 .08
Series 1574, Class AB, 6.50% 2023 4,480 3,584 .06
Series 21, Class GNMA SE, 6.5626% 2023 /6/ 4,000 2,222 .04
Series 1657, Class SA, 7.0299% 2023 /6/ 7,520 3,955 .07
Series 1673, Class SA, 5.2766% 2024 /6/ 7,879 3,720 .07
Federal National Mortgage Assn.:
Series 90-142, Class J, 9.25% 2003 4,359 4,417 .08
Series 91-146, Class Z, 8.00% 2006 6,028 6,226 .11
Series 93-78, Class SB, 7.2517% 2008 /6/ 3,412 2,325 .04
Series 91-65, Class X, 6.50% 2019 19,082 17,740 .31
Series 90-93, Class G, 5.50% 2020 1,500 1,382 .03
Series G93-19SJ, Class I, 0% 2023 /6/ 467 175 .00
Series 93-138, Class SA, 9.0687% 2023 /6/ 3,758 2,345 .04
Series 93-120, Class SB, 9.0687% 2023 /6/ 5,828 3,883 .07
-------------- ----------
66,492 1.17
-------------- ----------
U.S. TREASURY OBLIGATIONS
9.25% January 1996 25,000 25,445 .45
7.875% February 1996 83,000 84,038 1.48
8.875% February 1996 40,000 40,738 .72
9.375% April 1996 20,000 20,553 .36
6.875% October 1996 8,000 8,106 .14
8.00% October 1996 31,000 31,823 .56
8.00% January 1997 53,000 54,656 .96
8.875% November 1997 11,500 12,251 .22
5.625% January 1998 5,000 4,966 .09
8.125% February 1998 169,750 178,847 3.15
9.25% August 1998 185,250 202,588 3.57
8.875% February 1999 28,500 31,172 .55
9.125% May 1999 20,750 22,968 .40
6.875% July 1999 63,000 64,969 1.14
8.875% May 2000 10,000 11,208 .20
8.750% August 2000 25,000 28,000 .49
8.50% November 2000 55,500 61,787 1.09
7.75% February 2001 31,500 34,054 .60
13.125% May 2001 21,500 28,938 .51
14.25% February 2002 7,000 10,072 .18
6.375% August 2002 31,450 31,823 .56
11.625% November 2002 87,000 114,799 2.02
7.25% August 2004 500 534 .01
11.625% November 2004 62,000 85,231 1.50
10.375% November 2009 19,500 24,933 .44
12.75% November 2010 10,500 15,506 .27
10.375% November 2012 17,000 22,485 .40
12.00% August 2013 10,000 14,750 .26
11.25% February 2015 6,000 9,002 .16
10.625% August 2015 35,000 50,203 .88
8.875% August 2017 99,500 123,878 2.18
7.125% February 2023 5,000 5,268 .09
-------------- ----------
1,455,591 25.63
-------------- ----------
FLOATING RATE EURODOLLAR NOTES (UNDATED) /3/
Allied Irish Banks Ltd. 6.187% 10,000 8,550 .15
Bank of Nova Scotia 6.5625% 15,000 11,700 .21
Bergen Bank 6.5625% 5,000 3,837 .07
Canadian Imperial Bank of Commerce 6.625% 25,000 19,750 .35
Christiana Bank Og Kreditkasse 6.4375% 11,000 8,525 .15
Financiere Credit Suisse 6.125% 8,000 6,200 .11
Hongkong and Shanghai Banking Corp. 6.75% 10,000 8,050 .14
.
(#2) 6.25% 5,000 4,200 .07
(#3) 6.537% 5,000 4,181 .07
Midland Bank 6.125% 5,000 4,038 .07
National Bank of Canada 3.2813% 5,000 3,250 .06
Standard Chartered Bank:
6.125% 15,000 11,100 .20
5.9625% 5,000 3,700 .07
-------------- ----------
97,081 1.72
-------------- ----------
EQUITY-TYPE SECURITIES & MISCELLANEOUS
EQUITY-TYPE SECURITIES /6/
California Federal Bank, Inc., Class A 2,002 26,272 .46
Dial Page, Inc., warrants /7/ 39 0 .00
Glendale Federal Bank, FSB warrants expire 03/10/00 8 10 .00
-------------- ----------
26,282 .46
-------------- ----------
MISCELLANEOUS
Investment securities in the initial period of
acquisition 16,414 .29
-------------- ----------
TOTAL BONDS, NOTES AND EQUITY-TYPE SECURITIES -------------- ----------
(cost: $5,266,732,000) 5,275,389 92.89
-------------- ----------
SHORT-TERM SECURITIES
COMMERCIAL PAPER
American General Corp. 5.93% due 8/11/95 15,000 14,896 .26
Beneficial Corp. 5.93% due 8/11/95 10,800 10,725 .19
Central and South West 5.96% due 7/11/95 3,800 3,793 .07
CPC International Inc. 5.77% due 9/21/95 6,400 6,313 .11
Commercial Credit Co.:
5.94% due 7/28/95 25,000 24,885 .44
5.94% due 8/3/95 5,000 4,972 .09
DuPont E I 5.93% due 7/11/95 11,000 10,980 .19
Ford Motor Credit Co. 5.95% due 7/28/95 18,400 18,315 .32
PACCAR Financial Corp. 5.95% due 7/14/95 17,000 16,961 .30
J.C. Penney Funding Corp.:
5.93% due 8/1/95 20,000 19,895 .35
5.90% due 8/4/95 15,000 14,914 .26
PepsiCo, Inc.:
5.85% due 7/17/95 16,400 16,355 .29
5.95% due 8/9/95 6,000 5,960 .10
Pitney Bowes Credit Corp. 5.92% due 7/13/95 25,000 24,947 .44
Procter & Gamble Co. 5.94% due 7/10/95 12,600 12,579 .22
SAFECO Credit Co. 5.92% due 7/10/95 7,000 6,988 .12
Schering Corp. 5.98% due 7/6/95 14,000 13,986 .25
Texaco Inc. due 5.94% 7/24/95 27,000 26,893 .47
Toronto-Dominion Holdings (U.S.A.) 5.97% due 7/5/95 11,700 11,690 .21
UBS Finance (Delaware):
6.20% due 7/3/95 20,000 19,990 .35
6.15% due 7/5/95 10,000 9,991 .18
Xerox Corp. 6.03% due 7/5/95 5,000 4,996 .09
-------------- ----------
301,024 5.30
-------------- ----------
FEDERAL AGENCY DISCOUNT NOTES
Federal Home Loan Mortgage Corp.:
5.90% due 7/5/95 7,111 7,105 .12
5.85% due 8/2/95 25,000 24,866 .44
5.87% due 8/2/95 12,500 12,433 .22
-------------- ----------
44,404 .78
-------------- ----------
Certificates of Deposit
Societe Generale:
6.05% due 7/6/95 15,000 15,000 .26
6.00% due 8/4/95 10,000 10,000 .18
-------------- ----------
25,000 .44
-------------- ----------
TOTAL SHORT-TERM SECURITIES (Cost $370,430,000) 370,428 6.52
-------------- ----------
TOTAL INVESTMENT SECURITIES (cost $5,637,162,000) 5,645,817 99.41
Excess of cash and receivables over payables 33,523 .59
-------------- ----------
NET ASSETS $5,679,340 100.00
============== ==========
</TABLE>
/1/ Purchased in a private placement transaction;
resale may be made to qualified institutional buyers.
/2/ Represents a zero coupon bond which will convert to an
interest-bearing security at a later date.
/3/ Coupon rates may change periodically.
/4/ CenCall merged with Nextel on July 28, 1995 and is
expected to merge with Dial Call in September. The
securities of Dial Call and Cencall will become obligations
of Nextel.
/5/ Pass-through securities backed by a pool of
mortgages or other loans on which principal payments
are periodically made. Therefore, the effective
maturity of these securities is shorter than the stated
/6/ Represents an inverse floater, which is a floating
rate note whose interest rate moves in the opposite
direction of prevailing interest rates.
/7/ Non-income-producing security.
See Notes to Financial Statements
<PAGE>
The Bond Fund of America
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1995 UNAUDITED
<TABLE>
<CAPTION>
(dollars in thousands)
<S> <C> <C>
Assets:
Investment securities at market
(cost: $5,637,162) $5,645,817
Cash 6,667
Receivables for--
Sales of investments $46,787
Sales of Fund's shares 12,265
Dividends and accrued interest 100,800 159,852
------------ ---------------
5,812,336
Liabilities:
Payables for--
Purchases of investments 113,412
Repurchases of fund's shares 7,539
Forward currency contracts 2,351
Dividends on Fund's shares 7,934
Management services 1,721
Accrued expenses 39 132,996
------------ ---------------
Net Assets at June 30, 1995 --
Equivalent to $13.49 per share on
421,133,630 shares of $1 par value
capital stock outstanding (authorized
capital stock - 500,000,000 shares) $5,679,340
===============
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1995 (dollars in thousands)
Investment Income:
Income:
Interest 230,712
Expenses:
Management services fee 9,886
Distribution expenses 6,494
Transfer agent fee 2,083
Reports to shareholders 89
Registration statement and prospectus 87
Postage, stationery and supplies 281
Directors' fees 17
Auditing and legal fees 22
Custodian fee 136
Taxes other than federal income tax 31 $19,126
------------ ---------------
Net investment income $211,586
===============
Realized Loss and Unrealized
Appreciation on Investments:
Net realized loss (24,515)
Net unrealized appreciation
(depreciation) on:
Investments 357,035
Open forward currency contracts (949)
------------
Net unrealized appreciation 356,086
---------------
Net realized loss and
unrealized appreciation
on investments 331,571
---------------
Net Increase in Net Assets Resulting $543,157
from Operations ===============
STATEMENT OF CHANGES IN NET ASSETS (dollars in thousands)
Six Months Year ended
Ended December 31,
JUNE 30, 1994
1995*
Operations:
Net investment income $211,586 $395,207
Net realized loss on investments (24,515) (36,092)
Net unrealized appreciation
(depreciation) on investments 356,086 (626,541)
------------ ---------------
Net increase (decrease) in net assets
resulting from operations 543,157 (267,426)
------------ ---------------
Dividends and Distributions Paid to
Shareholders:
Dividends from net
investment income (219,979) (396,205)
Distributions from net realized gain
on investments -- --
------------ ---------------
Total dividends and distributions (219,979) (396,205)
------------ ---------------
Capital Share Transactions:
Proceeds from shares sold:
57,976,127 and 99,296,409
shares, respectively 758,168 1,337,647
Proceeds from shares issued in
reinvestment of net investment
income dividends and distributions
of net realized gain on investments:
11,477,349 and 20,827,138 shares,
respectively 150,589 277,618
Cost of shares repurchased:
37,756,318 and 96,388,393
shares, respectively (493,745) (1,295,101)
------------ ---------------
Net increase in net assets
resulting from capital share
transactions 415,012 320,164
------------ ---------------
Total Increase (Decrease) in Net Assets 738,190 (343,467)
Net Assets:
Beginning of period 4,941,150 5,284,617
------------ ---------------
End of period (including
undistributed net investment
income: $(3,983) and $4,410
respectively) 5,679,340 $4,941,150
============ ===============
</TABLE>
*Unaudited
See Notes to Financial Statements
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. Bond Fund of America, Inc. (the "fund") is registered under the Investment
Company Act of 1940 as an open-end, diversified management investment company.
The following paragraphs summarize the significant accounting policies
consistently followed by the fund in the preparation of its financial
statements:
Bonds and notes are valued at prices obtained from a bond-pricing service
provided by a major dealer in bonds, when such prices are available, however,
in circumstances where the investment adviser deems it appropriate to do so,
such securities will be valued at the mean of representative quoted bid and
asked prices or, if such price are not available, at prices for securities of
comparable maturity, quality and type. Securities denominated in non-U.S.
currencies are generally valued on the basis of bid quotations. Short-term
securities with original or remaining maturities in excess of 60 days are
valued at the mean of their quoted bid and asked prices. Short-term securities
with 60 days or less to maturity are valued at amortized cost, which
approximates market value. The maturities of variable or floating rate
instruments are deemed to be the time remaining until the next interest rate
adjustment date. Stocks and convertible debentures are stated at market value
based upon closing sales prices reported on recognized securities exchanges on
the last business day of the period or, for listed securities having no sales
reported, upon last-reported bid prices on that date. Securities traded in the
over-the-counter market are valued at the last available sale price prior to
the time of valuation, or, lacking any sales, at the last reported bid price.
Securities for which market quotations are not readily available are valued at
fair value as determined in good faith by the Valuation Committee of the Board
of Directors.
As is customary in the mutual fund industry, securities transactions are
accounted for on the date the securities are purchased or sold. Realized gains
and losses from securities transactions are reported on an identified cost
basis. Interest income is reported on the accrual basis. Discounts on
securities purchased are amortized over the life of the respective securities.
The fund does not amortize premiums on securities purchased. Dividends are
declared on a daily basis after determination of the fund's net asset value and
are paid to shareholders on a monthly basis.
Investment securities, including forward currency contracts, denominated in
non-U.S. currencies are recorded in the financial statements after translation
into U.S. dollars utilizing rates of exchange on the last business day of the
fiscal period. Interest income from such investments is calculated using the
approximate exchange rate as accrued or when received. Purchases and sales of
investment securities and interest income are calculated at the rates of
exchange prevailing on the respective dates of such transactions. The fund
does not identify the portion of each amount shown in the fund's statement of
operations under the caption "Realized Loss and Unrealized Appreciation on
Investments" that arises from changes in non-U.S. currency exchange rates.
Pursuant to the custodian agreement, the fund receives credit against its
custodian fee for imputed interest on certain balances with the with the
custodian bank. The custodian fee of $136,000 includes $45,000 that was paid
by credits rather than in cash.
2. It is the fund's policy to continue to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its net taxable income, including any net realized gain on
investments, to its shareholders. Therefore, no federal income tax provision
is required.
As of June 30, 1995, net unrealized appreciation on investments, excluding
forward currency contracts, for book and federal income tax purposes aggregated
$6,303,000, of which $125,752,000 related to appreciated securities and
$119,449,000 related to depreciated securities. During the six months ended
June 30, 1995, the fund realized, on a tax basis, a net capital loss of
$24,515,000 on securities transactions. The cost of portfolio securities,
excluding foreign currency contracts, for book and federal income tax purposes
was $5,637,162,000 at June 30, 1995.
3. The fee of $9,886,0000 for management services was paid pursuant to an
agreement with Capital Research and Management Company (CRMC), with which
certain officers and Directors of the fund are affiliated. The Investment
Advisory and Service Agreement provides for monthly fees, accrued daily, based
on an annual rate of 0.30% of the first $60 million of average net assets;
0.21% of such assets in excess of $60 million but not exceeding $1 billion;
0.18% of such assets in excess of $1 billion but not exceeding $3 billion; and
0.16% of such assets in excess of $3 billion ("asset-based fee"); plus 3.00% on
the first $450,000 of the fund's monthly gross investment income; and 2.25% of
such income in excess of $450,000 ("income-based fee").
Pursuant to a Plan of Distribution, the fund may expend up to 0.25% of its
average net assets annually for any activities primarily intended to result in
sales of fund shares, provided the categories of expenses for which
reimbursement is made are approved by the fund's Board of Directors. Fund
expenses under the Plan include payments to dealers to compensate them for
their selling and servicing efforts. During the six months ended June 30,
1995, distribution expenses under the Plan were $6,494,000. As of June 30,
1995, accrued and unpaid distribution expenses were $834,000.
American Funds Service Company (AFS), the transfer agent for the fund, was
paid a fee of $2,083,000 under the terms of a contract that provides for
transfer agency services to be performed for the fund. American Funds
Distributors, Inc. (AFD), the principal underwriter of the fund's shares,
received $2,227,000 (after allowances to dealers) as its portion of the sales
charges paid by purchasers of the fund's shares. Such sales charges are not an
expense of the fund and, hence, are not reflected in the accompanying statement
of operations.
Directors of the fund who are unaffiliated with CRMC may elect to defer part
or all of the fees earned for services as members of the Board. Amounts
deferred are not funded and are general unsecured liabilities of the fund. As
of June 30, 1995, aggregate amounts deferred were $24,750.
CRMC is owned by The Capital Group Companies, Inc. AFS and AFD are both
wholly owned subsidiaries of CRMC. Certain of the Directors and officers of
the fund are or may be considered to be affiliated with CRMC, AFS and AFD. No
such persons received any remuneration directly from the fund
4. As of June 30, 1995, accumulated undistributed net realized loss on
investments was $29,582,000 and paid-in capital was $5,309,921,000.
The fund made purchases and sales of investment securities, excluding
short-term securities, of $1,622,718,000 and $1,127,686,000, respectively,
during the six months ended June 30, 1995.
The fund purchases forward currency contracts in anticipation of, or to
protect itself against, fluctuations in exchange rates. The contracts are
recorded at market value and reflect the extent of the fund's involvement in
these financial instruments. Risk may arise upon entering these contracts from
the potential inability of counterparties to meet the terms of their contracts
and from the possible movements in foreign exchange rates and securities values
underlying these instruments.
*****************
<TABLE>
<CAPTION>
Contract Amount U.S. at 6/30/95
Valuations
---------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Unrealized
Appreciation
Non-U.S. currency contracts Non-U.S. U.S. Amount (Depreciation)
French Francs expiring 11/27/95 to 9/9/92 FF 70,000,000 $11,811,000 $14,154,000 ($2,343,000)
Great Britain Pounds expiring 9/19/95 GBP 3,325,000 3,189,000 3,181,000 8,000
Netherland Guilders expiring 9/18/95 FL 4,820,000 3,095,000 3,111,000 (16,000)
---------- ------------ -------------
$18,095,000 $20,446,000 ($2,351,000)
========== ============ =============
</TABLE>
******************8
Per-Share Data and Ratios
<TABLE>
<CAPTION>
Six
Months
Ended Year Ended December 31
06/30/95 1994 1993 1992 1991 1990
/1/
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $12.69 $14.45 $13.99 $13.70 $12.39 $13.23
-------- ------- ------- ------- ------- -------
Income from investment operations:
Net investment income 0.52 1.05 1.09 1.15 1.21 1.24
Net realized and unrealized gain (loss) 0.82 (1.76) 0.84 0.34 1.28 (0.84)
on investments
--------- -------- -------- -------- -------- --------
Total from investment operations 1.34 (0.71) 1.93 1.49 2.49 0.40
--------- -------- -------- -------- -------- --------
Less distributions:
Dividends from net investment income (0.54) (1.05) (1.08) (1.16) (1.18) (1.24)
Distributions from capital gains -- -- (0.39) (0.04) -- --
-------- -------- -------- -------- -------- --------
Total distributions (0.54) (1.05) (1.47) (1.20) (1.18) (1.24)
-------- -------- -------- -------- -------- --------
Net asset value, end of period $13.49 $12.69 $14.45 $13.99 $13.70 $12.39
======== ======== ======== ======== ======== ========
Total Return /2/ 10.63% /3/ (5.02%) 14.14% 11.34% 21.04% 3.27%
Ratios/supplemental data:
Net assets, end of period (in millions) $5,679 $4,941 $5,285 $3,917 $2,859 $1,945
Ratio of expenses to average net assets .37% /3/ .69% .71% .73% .77% .76%
Ratio of net income to average net 4.14% /3/ 7.77% 7.53% 8.36% 9.28% 9.70%
assets
Portfolio turnover rate 23.98% /3/ 56.98% 44.68% 49.70% 56.47% 59.90%
</TABLE>
/1/ Unaudited
/2/ This was calculated without deducting a sales
charge. The maximum sales charge is 4.75% of
the fund's offering price.
/3/ These ratios are based on the period shown
and, accordingly, are not representative
of a full year's operations.
<PAGE>
THE BOND FUND OF AMERICA
BOARD OF DIRECTORS
H. FREDERICK CHRISTIE
Palos Verdes Estates, California
Private investor; former President
and Chief Executive Officer,
The Mission Group; former President,
Southern California Edison Company
DIANE C. CREEL
Long Beach, California
Chairwoman, Chief Executive
Officer and President,
The Earth Technology Corporation
MARTIN FENTON, JR.
San Diego, California
Chairman of the Board,
Senior Resource Group, Inc.
(senior living centers management)
LEONARD R. FULLER
Los Angeles, California
President, Fuller & Company, Inc.
(financial management consulting firm)
ABNER D. GOLDSTINE
Los Angeles, California
President of the fund
Senior Vice President and Director,
Capital Research and Management Company
PAUL G. HAAGA, JR.
Los Angeles, California
Chairman of the Board of the fund
Senior Vice President and Director,
Capital Research and Management Company
HERBERT HOOVER III
Pasadena, California
Private investor
RICHARD G. NEWMAN
Los Angeles, California
Chairman of the Board, President and Chief Executive Officer, AECOM Technology
Corporation (architectural engineering)
PETER C. VALLI
Long Beach, California
Chairman of the Board and Chief Executive Officer, BW/IP International, Inc.
(industrial manufacturing)
OTHER OFFICERS
RICHARD T. SCHOTTE
Los Angeles, California
Senior Vice President of the fund
Senior Vice President,
Capital Research and Management Company
MARY C. CREMIN
Los Angeles, California
Vice President and Treasurer of the fund
Senior Vice President - Fund Business Management Group,
Capital Research and Management Company
MICHAEL J. DOWNER
Los Angeles, California
Vice President of the fund
Senior Vice President - Fund Business Management Group,
Capital Research and Management Company
JOHN H. SMET
Los Angeles, California
Vice President of the fund
Vice President,
Capital Research and Management Company
JULIE F. WILLIAMS
Los Angeles, California
Secretary of the fund
Vice President - Fund Business
Management Group,
Capital Research and Management Company
KIMBERLY S. VERDICK
Los Angeles, California
Assistant Secretary of the fund
Compliance Associate - Fund Business Management Group,
Capital Research and Management Company
ANTHONY W. HYNES, JR.
Los Angeles, California
Assistant Treasurer of the fund
Vice President - Fund Business
Management Group,
Capital Research and Management Company
OFFICES OF THE FUND AND OF THE INVESTMENT ADVISER,
CAPITAL RESEARCH AND MANAGEMENT COMPANY
333 South Hope Street
Los Angeles, California 90071-1443
135 South State College Boulevard
Brea, California 92621-5804
TRANSFER AGENT FOR SHAREHOLDER ACCOUNTS
American Funds Service Company
P.O. Box 2205
Brea, California 92622-2205
P.O. Box 659522
San Antonio, Texas 78265-9522
P.O. Box 6007
Indianapolis, Indiana 46206-6007
P.O. Box 2280
Norfolk, Virginia 23501-2280
CUSTODIAN OF ASSETS
The Chase Manhattan Bank, N.A.
One Chase Manhattan Plaza
New York, New York 10081-0001
COUNSEL
Morrison & Foerster
345 California Street
San Francisco, California 94104-2675
PRINCIPAL UNDERWRITER
American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, California 90071-1462
FOR INFORMATION ABOUT YOUR ACCOUNT OR ANY OF THE FUND'S SERVICES,
PLEASE CONTACT YOUR SECURITIES DEALER OR FINANCIAL PLANNER, OR
CALL THE FUND'S TRANSFER AGENT, TOLL-FREE, AT 800/421-0180.
This report is for the information of shareholders of The Bond Fund of America,
but it may also be used as sales literature when preceded or accompanied by the
current prospectus, which gives details about charges, expenses, investment
objectives and operating policies of the fund. If used as sales material after
September 30, 1995, this report must be accompanied by an American Funds Group
Statistical Update for the most recently completed calendar quarter.
Litho in USA AGD/AL/2689
Lit. No. BFA-013-0895
[The American Funds Group(R)]
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