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<PAGE> PAGE 2
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<PAGE> PAGE 3
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<PAGE> PAGE 4
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SIGNATURE ALAN MANDEL
TITLE TREASURER
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information
extracted from The Salomon Brothers Capital Fund Inc
form N-SAR for the period ended December 31, 1997
and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
<SERIES>
<NUMBER> 01
<NAME> Salomon Brothers Capital Fund Inc Class A
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
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<INVESTMENTS-AT-VALUE> 188,973,237
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</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information
extracted from The Salomon Brothers Capital Fund Inc
form N-SAR for the period ended December 31, 1997
and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
<SERIES>
<NUMBER> 02
<NAME> Salomon Brothers Capital Fund Inc Class B
<S> <C>
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</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information
extracted from The Salomon Brothers Capital Fund Inc
form N-SAR for the period ended December 31, 1997
and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
<SERIES>
<NUMBER> 03
<NAME> Salomon Brothers Capital Fund Inc Class C
<S> <C>
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</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information
extracted from The Salomon Brothers Capital Fund Inc
form N-SAR for the period ended December 31, 1997
and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
<SERIES>
<NUMBER> 04
<NAME> Salomon Brothers Capital Fund Inc Class O
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</TABLE>
SALOMON BROTHERS CAPITAL FUND
PURCHASE PURSUANT TO
RULE 10f-3 OF ICA
NAME OF STOCK: China Southern Airlines Company Limited ADR
DATE OF PURCHASE: July 25, 1997
NUMBER OF SHARES PURCHASED: 1,000
AGGREGATE PURCHASE PRICE: $30,660
PRICE PER SHARE: $30.66
UNDERWRITING SPREAD: $1.61
% GROSS UNDERWRITING SPREAD: 5.25%
SHARES OFFERED: 20,600,000
TOTAL OFFERING: $568,313,760
4% OF OFFERING: $22,732,550
3% OF TOTAL ASSETS: $5,291,076(3% of 176,369,189)
BROKER: Goldman Sachs
Note: The above represents the only stock purchased by funds in the Salomon
Brothers complex.
The above purchase was made in accordance with the procedures adopted by the
Board of Directors pursuant to Rule 10(f)3 of the Investment Company Act of
1940, as amended.
Underwriters
Goldman, Sachs & Co.
Credit Suisse First Boston Corporation
Paine Webber Incorporated
Smith Barney, Inc.
Donaldson, Lufkin & Jenrette Securities
Corporation
Salomon Brothers Inc
<PAGE>
SALOMON BROTHERS CAPITAL FUND
PURCHASE PURSUANT TO
RULE 10f-3 OF ICA
NAME OF STOCK: Steel Dynamics
DATE OF PURCHASE: August 13, 1997
NUMBER OF SHARES PURCHASED: 15,000
AGGREGATE PURCHASE PRICE: $375,000
PRICE PER SHARE: $25.00
UNDERWRITING SPREAD: $1.00
% GROSS UNDERWRITING SPREAD: 4.00%
SHARES OFFERED: 8,400,000
TOTAL OFFERING: $210,000,000
4% OF OFFERING: $8,400,000
3% OF TOTAL ASSETS: $5,384,347(3% of 179,478,220)
BROKER: Morgan Stanley
McDonald & Co.
Note: The above represents the only stock purchased by funds in the Salomon
Brothers complex.
The above purchase was made in accordance with the procedures adopted by the
Board of Directors pursuant to Rule 10(f)3 of the Investment Company Act of
1940, as amended.
Underwriters
Morgan Stanley & Co. Incorporated
Paine Webber Incorporated
Donaldson, Lufkin & Jenrette Securities
Corporation
McDonald & Company Securities, Inc.
Salomon Brothers Inc
Morgan Stanley & Co. International Limited
PaineWebber International (U.K.) Ltd.
Donaldson, Lufkin & Jenrette Securities
Corporation
Salomon Brothers International Limited
<PAGE>
SALOMON BROTHERS CAPITAL FUND
PURCHASE PURSUANT TO
RULE 10f-3 OF ICA
NAME OF STOCK: Ivex Packaging Corporation
DATE OF PURCHASE: September 30, 1997
NUMBER OF SHARES PURCHASED: 60,000
AGGREGATE PURCHASE PRICE: $960,000
PRICE PER SHARE: $16.00
UNDERWRITING SPREAD: $1.08
% GROSS UNDERWRITING SPREAD: 6.75%
SHARES OFFERED: 8,400,000
TOTAL OFFERING: $134,400,000
4% OF OFFERING: $5,376,000
3% OF TOTAL ASSETS: $5,744,273(3% of 191,475,768)
BROKER: Merrill Lynch
Note: The above represents the only stock purchased by funds in the Salomon
Brothers complex.
The above purchase was made in accordance with the procedures adopted by the
Board of Directors pursuant to Rule 10(f)3 of the Investment Company Act of
1940, as amended.
Underwriters
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Lehman Brothers Inc.
Salomon Brothers Inc
Bear, Stearns & Co., Inc.
BT Alex. Brown Incorporated
Credit Suisse First Boston Corporation
Donaldson, Lufkin & Jenrette Securities Corporation
Lazard Freres & Co. LLC
Paine Webber Incorporated
Societe Generale Securities Corporation
William Blair & Company, L.L.C.
EVEREN Securities, Inc.
Legg Mason Wood Walker Incorporated
McDonald & Company Securities, Inc.
Mesirow Financial, Inc.
Nesbitt Burns Securities Inc.
Piper Jaffray Inc.
Ragen Mackenzie Incorporated
Rauscher Pierce Refsnes, Inc.
The Robinson - Humphrey Company, Inc.
Sutro & Co., Incorporated
Wheat, First Securities, Inc.
<PAGE>
SALOMON BROTHERS CAPITAL FUND
PURCHASE PURSUANT TO
RULE 10f-3 OF ICA
NAME OF STOCK: Fleet Financial Group
DATE OF PURCHASE: December 4, 1997
NUMBER OF SHARES PURCHASED: 30,000
AGGREGATE PURCHASE PRICE: $2,111,250
PRICE PER SHARE: $70.375
UNDERWRITING SPREAD: $1.50
% GROSS UNDERWRITING SPREAD: 4.94%
SHARES OFFERED: 10,750,000
TOTAL OFFERING: $756,531,250
25% OF OFFERING: $189,132,813
BROKER: Merrill Lynch
Note: The above represents the only stock purchased by funds in the Salomon
Smith Barney complex.
The above purchase was made in accordance with the procedures adopted by the
Board of Directors pursuant to Rule 10(f)3 of the Investment Company Act of
1940, as amended.
Underwriters
Merrill Lynch, Pierce, Fenner & Smith Incorporated
UBS Securities Inc. LLC
Credit Suisse First Boston Corporation
Goldman, Sachs & Co.
Keefe, Bruyette & Woods, Inc.
Lehman Brothers Inc.
Smith Barney, Inc.
<PAGE>
SALOMON BROTHERS CAPITAL FUND
PURCHASE PURSUANT TO
RULE 10f-3 OF ICA
NAME OF STOCK: Virgin Express Holdings
DATE OF PURCHASE: November 13, 1997
NUMBER OF SHARES PURCHASED: 10,200
AGGREGATE PURCHASE PRICE: $153,000
PRICE PER SHARE: $15.00
UNDERWRITING SPREAD: $.90
% GROSS UNDERWRITING SPREAD: 6.00%
SHARES OFFERED: 2,140,000
TOTAL OFFERING: $96,300,000
25% OF OFFERING: $24,075,000
BROKER: Merrill Lynch
Note: A total of 49,200 shares was purchased by funds in the Salomon Brothers
complex for an aggregate purchase price of $738,000.
The above purchase was made in accordance with the procedures adopted by the
Board of Directors pursuant to Rule 10(f)3 of the Investment Company Act of
1940, as amended.
Underwriters
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Credit Suisse First Boston Corporation
Salomon Brothers Inc
Goldman, Sachs & Co.
Morgan Stanley & Co. Incorporated
Paine Webber Incorporated
The Robinson - Humphrey Company, Inc.
Smith Barney, Inc.
Merrill Lynch International Limited
Credit Suisse First Boston (Europe), Ltd
Petercam S.A./N.V.
Salomon Brothers International Limited
<PAGE>
SALOMON BROTHERS CAPITAL FUND
PURCHASE PURSUANT TO
RULE 10f-3 OF ICA
NAME OF STOCK: The CIT Group
DATE OF PURCHASE: November 13, 1997
NUMBER OF SHARES PURCHASED: 7,100
AGGREGATE PURCHASE PRICE: $191,700
PRICE PER SHARE: $27.00
UNDERWRITING SPREAD: $1.35
% GROSS UNDERWRITING SPREAD: 5.00%
SHARES OFFERED: 31,500,000
TOTAL OFFERING: $850,500,000
25% OF OFFERING: $212,625,000
BROKER: JP Morgan
Note: A total of 99,400 shares was purchased by funds in the Salomon Brothers
complex for an aggregate purchase price of $2,683,800.
The above purchase was made in accordance with the procedures adopted by the
Board of Directors pursuant to Rule 10(f)3 of the Investment Company Act of
1940, as amended.
Underwriters
J.P. Morgan Securities Inc.
Goldman, Sachs & Co.
Morgan Stanley & Co. Incorporated
Credit Suisse First Boston Corporation
Lehman Brothers Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Brothers Inc
UBS Securities Inc. LLC
Bear, Stearns & Co., Inc.
BT Alex. Brown Incorporated
Chase Securities, Inc.
CIBC Oppenheimer Corp
Donaldson, Lufkin & Jenrette Securities Corporation
Dresdner Kleinwart Benson North America LLC
SBC Warburg Dillon Read Inc.
Charles Schwab & Co., Inc.
Chatsworth Securities LLC
Gruntal & Co., LLC
Kankaku Securities (America), Inc.
Nesbitt Burns Securities Inc.
Piper Jaffray Inc.
RBC Dominion Securities Corporation
Scotia Capital Markets (USA) Inc.
<PAGE>
SALOMON BROTHERS CAPITAL FUND
PURCHASE PURSUANT TO
RULE 10f-3 OF ICA
NAME OF STOCK: AMF Bowling
DATE OF PURCHASE: November 3, 1997
NUMBER OF SHARES PURCHASED: 10,200
AGGREGATE PURCHASE PRICE: $198,900
PRICE PER SHARE: $19.50
UNDERWRITING SPREAD: $1.22
% GROSS UNDERWRITING SPREAD: 6.26%
SHARES OFFERED: 13,500,000
TOTAL OFFERING: $263,250,000
25% OF OFFERING: $65,812,500
BROKER: Goldman Sachs
Note: A total of 49,200 shares was purchased by funds in the Salomon Brothers
complex for an aggregate purchase price of $959,400.
The above purchase was made in accordance with the procedures adopted by the
Board of Directors pursuant to Rule 10(f)3 of the Investment Company Act of
1940, as amended.
Underwriters
Goldman, Sachs & Co.
Morgan Stanley & Co. Incorporated
Cowen & Company
Schroder & Co. Inc.
CIBC Oppenheimer Corp
A.G. Edwards & Sons, Inc.
EVEREN Securities, Inc.
Paine Webber Incorporated
Salomon Brothers Inc
Smith Barney, Inc.
Wasserstein Perella Securities, Inc.
Wheat First Butcher Singer
Advest, Inc.
Dain Bosworth Incorporated
Davenport & Co. LLC
Gruntal & Co., LLC
Interstate/Johnson Lane Corporation
Jefferies & Company, Inc.
Edward D. Jones & Co., L.P.
Ladenburg, Thalman & Co., Inc.
McDonald & Company Securities, Inc.
Principal Financial Securities, Inc.
Raymond James & Associates, Inc.
Roney & Co., LLC
Scott & Stringfellow, Inc.
Stephens, Inc.
Tucker Anthony Incorporated
<PAGE>
SALOMON BROTHERS CAPITAL FUND
PURCHASE PURSUANT TO
RULE 10f-3 OF ICA
NAME OF STOCK: Teligent
DATE OF PURCHASE: November 21, 1997
NUMBER OF SHARES PURCHASED: 1,000
AGGREGATE PURCHASE PRICE: $21,500
PRICE PER SHARE: $21.50
UNDERWRITING SPREAD: $1.40
% GROSS UNDERWRITING SPREAD: 6.51%
SHARES OFFERED: 5,500,000
TOTAL OFFERING: $118,250,000
25% OF OFFERING: $29,562,500
BROKER: Merrill Lynch
Note: A total of 4,900 shares was purchased by funds in the Salomon Brothers
complex for an aggregate purchase price of $105,350.
The above purchase was made in accordance with the procedures adopted by the
Board of Directors pursuant to Rule 10(f)3 of the Investment Company Act of
1940, as amended.
Underwriters
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Brothers Inc
Bear, Stearns & Co., Inc.
Goldman, Sachs & Co.
CIBC Oppenheimer Corp
EVEREN Securities, Inc.
Friedman, Billings, Ramsey & Co., Inc.
Furman Selz LLC
Lazard Freres & Co. LLC
Legg Mason Wood Walker Incorporated
Lehman Brothers Inc.
Morgan Stanley & Co. Incorporated
NationsBanc Montgomery Securities, Inc.
Paine Webber Incorporated
Prime Charter LTD
SBC Warburg Dillon Read Inc.
Smith Barney, Inc.
UBS Securities Inc. LLC
Arnhold & S. Bleichroeder, Inc.
Robert W. Baird & Co. Incorporated
George K. Baum & Company
Cowen & Company
Gabelli & Company, Inc.
Janney Montgomery Scott Inc.
Parker / Hunter Incorporated
Brad Peery Inc.
Scott & Stringfellow, Inc.
SoundView Financial Group, Inc.
Wheat First Securities, Inc.
<PAGE>
February 23, 1998
To the Shareholders and Board of Directors of
Salomon Brothers Capital Fund Inc
In planning and performing our audit of the financial statements of Salomon
Brothers Capital Fund Inc (the "Fund") for the year ended December 31, 1997, we
considered its internal control, including control activities for safeguarding
securities, in order to determine our auditing procedures for the purpose of
expressing our opinion on the financial statements and to comply with the
requirements of Form N-SAR, not to provide assurance on internal control.
The management of the Fund is responsible for establishing and maintaining
internal control. In fulfilling this responsibility, estimates and judgments by
management are required to assess the expected benefits and related costs of
control activities. Generally, control activities that are relevant to an audit
pertain to the entity's objective of preparing financial statements for external
purposes that are fairly presented in conformity with generally accepted
accounting principles. Those control activities include the safeguarding of
assets against unauthorized acquisition, use or disposition.
Because of inherent limitations in internal control, errors or irregularities
may occur and not be detected. Also, projection of any evaluation of internal
control to future periods is subject to the risk that it may become inadequate
because of changes in conditions or that the effectiveness of the design and
operation may deteriorate.
Our consideration of internal control would not necessarily disclose all matters
in internal control that might be material weaknesses under standards
established by the American Institute of Certified Public Accountants. A
material weakness is a condition in which the design or operation of any
specific internal control components does not reduce to a relatively low level
the risk that errors or irregularities in amounts that would be material in
relation to the financial statements being audited may occur and not be detected
within a timely period by employees in the normal course of performing their
assigned functions. However, we noted no matters involving internal control,
including control activities for safeguarding securities, that we consider to be
material weaknesses as defined above as of December 31, 1997.
This report is intended solely for the information and use of management and the
Board of Directors of the Fund and the Securities and Exchange Commission.
PRICE WATERHOUSE LLP
