The
Corporate
Fund
Accumulation
Program,
Inc.
Semi-Annual Report
June 30, 1998
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Program unless
accompanied or preceded by the Program's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance. Investment return and
principal value of shares will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost.
Statements and other information herein are as dated and are subject
to change.
The Corporate Fund
Accumulation Program, Inc.
Box 9011
Princeton, NJ 08543-9011
Printed on post-consumer recycled paper
To Our Shareholders:
For the six months ended June 30, 1998, The Corporate Fund
Accumulation Program, Inc. provided a total investment return of
+3.93%, based on a change in per share net asset value from $21.13
to $21.40, and assuming reinvestment of $0.552 per share income
dividends. Additional performance information can be found on page 2
of this report to shareholders.
The Environment
Increasing volatility characterized the capital markets during the
six-month period ended June 30, 1998. At times, US stock and bond
prices reflected expectations that the slowdown in Asian economic
growth would impact US exports and the US trade deficit and slow
overall US business activity. The deterioration of economic
conditions in Japan was of particular concern, and caused a sharp
drop in the yen's value relative to the US dollar. During other
periods, US investors appeared to expect that the positive trends of
a moderately expanding economy, declining unemployment, enhanced
productivity and corporate profits growth would continue, unimpeded
by developments in Asia. To date, there have been only a few signs
that Asia's troubles are influencing US economic activity--such as a
surge in the accumulation of inventories--largely because domestic
demand has remained strong. In Europe, the major event was the
greater progress toward achieving European Monetary Union, although
there were concerns that interest rates may have to be increased,
especially in the United Kingdom, to curtail potential inflationary
pressures.
As we move into the second half of 1998, it is likely that investor
focus will remain on developments in Asia. The US Federal Reserve
Board has kept monetary policy on hold as the Asian financial crisis
deepened, which has benefited US bond and stock prices. Looking
ahead, if there is continued evidence of noninflationary economic
growth, it should have a positive influence on US capital markets.
Portfolio Matters
During January, the bond market traded within a very narrow range as
investors tried to assess the impact of the Asian financial crisis
on US economic growth. The yield curve steepened from 24 basis
points (0.24%) to 52 basis points as the yield on long-term bonds
dropped from 5.92% to 5.80%. In February, the bond market backed up
to 6% on long-term bonds, despite some favorable news. Most
significantly, the Federal Government ran a $17 billion budget
surplus for the 12 months ended January 1998. Commodity prices
trended down, and there was no change in the growth of the Consumer
Price Index. However, investors were concerned with rapid money
supply growth fueling a continuing record-high stock market against
a background of full employment. In March 1998, long-term bonds
traded within a very narrow range, starting at a yield of 6.01% and
finishing the month at 5.93%. This decline was the result of
mounting evidence of a continuing strong domestic economy. Consumer
spending, employment and production data remained in a growth trend.
The Federal Reserve Board reported in its "beige book" that many US
firms were desperate to find workers and were being forced to offer
large wage increases. Nevertheless, the US stock market, as measured
by the Dow Jones Industrial Average (DJIA), soared more than 400
points during March, and the bond market's reaction to these
concerns was clearly muted.
After a strong first quarter of 1998, in which the economy grew at a
rate of 5.4%, there were signs that a slower growth pattern was
emerging. Three of the major factors that fueled first-quarter
growth, consumer spending, inventory accumulation and capital
expenditure, slowed down during the spring. In addition, data on job
growth, hours worked and industrial production further indicated
slower growth for the second quarter. In April 1998, the DJIA
reached the 9,200 level and left investors concerned about inflated
stock prices. Each new release of economic data was examined under
the assumption that the Federal Reserve Board would raise interest
rates at its May meeting, but no such decision was made. Instead,
the combination of low energy prices, a strong dollar and weak
demand in Asia pushed interest rates lower. With inflation almost
nonexistent, the yield on the long-term bond fell below 5.80% in May
and continued its rally to below 5.60% in June.
During the period, we kept the duration of the Program in the
5.8 years--5.9 years range, which was consistent with the duration of
the Merrill Lynch Corporate Master Index. Additionally, we reduced
our cash and Treasury positions and purchased floating rate notes.
Asset-backed issues and real estate investment trusts were also
added as yield spreads widened. Structured securities accounted for
10.5% of the Program's portfolio by June 30, 1998. The average
quality rating of the Program's holdings was A+, as measured by
Standard & Poor's Investors Index, which was slightly higher than
the Merrill Lynch Corporate Master Index average of A. We maintained
a slight underweighting in the utility sector and made significant
cutbacks in our holdings of Yankee issues because their values were
being impacted by the deteriorating Asian situation.
In Conclusion
We appreciate your ongoing investment in The Corporate Fund
Accumulation Program, Inc., and we look forward to assisting you
with your financial needs in the months and years ahead.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Christopher G. Ayoub)
Christopher G. Ayoub
Senior Vice President and
Co-Portfolio Manager
(Jay C. Harbeck)
Jay C. Harbeck
Senior Vice President and
Co-Portfolio Manager
July 20, 1998
The Corporate Fund Accumulation Program, Inc.
Average Annual Total Return
Period Covered % Return
Year Ended 6/30/98 +9.93%
Five Years Ended 6/30/98 +6.00
Ten Years Ended 6/30/98 +8.35
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Schedule of Investments June 30, 1998
<CAPTION>
S&P Moody's Face Value
Industry Rating Rating Amount Issue Cost (Note 1a)
Corporate Bonds & Notes
<S> <S> <S> <C> <S> <C> <C>
Asset-Backed AAA Aaa $1,000,000 First Bank Corporate Card Securities
Securities++-- Master Trust, 6.40% due 2/15/2003 $ 999,047 $ 1,018,010
5.0% AAA Aaa 500,000 First Greensboro Home Equity Loan Trust,
6.55% due 12/25/2029 500,000 499,375
AAA Aaa 1,000,000 IMC Home Equity Loan Trust, 6.36% due
8/20/2022 999,807 1,000,938
NR++++ A2 1,000,000 Mortgage Capital Funding, Inc., 6.726% due
6/18/2008 1,009,990 1,010,000
----------- -----------
3,508,844 3,528,323
Banks & A+ Aa3 2,000,000 BankAmerica Corp., 7.125% due 5/12/2005 1,980,073 2,102,420
Thrifts-- A A2 400,000 First Chicago Corp., 8.875% due 3/15/2002 431,924 434,272
10.9% A- A2 2,000,000 First Interstate Bancorp, 9.90% due 11/15/2001 2,189,646 2,226,400
A- a2 750,000 Fleet Capital Trust II, 7.92% due 12/11/2026 743,451 803,197
A- A3 1,000,000 HSBC Americas Inc., 7% due 11/01/2006 992,988 1,030,050
A- a2 1,000,000 Mellon Capital II, 7.995% due 1/15/2027 955,403 1,086,330
----------- -----------
7,293,485 7,682,669
Financial A A2 1,000,000 Chrysler Financial Corp., 9.50% due 12/15/1999 1,045,611 1,048,120
Services-- A A1 1,000,000 Ford Motor Credit Co., 7.75% due 3/15/2005 999,387 1,081,130
Captive-- General Motors Acceptance Corp.:
6.0% A A2 1,000,000 9% due 10/15/2002 1,103,008 1,104,970
A A2 1,000,000 7.125% due 5/01/2003 1,040,007 1,042,610
----------- -----------
4,188,013 4,276,830
Financial A+ A1 500,000 Allstate Corp., 6.75% due 5/15/2018 499,856 509,430
Services-- A A2 1,000,000 Beneficial Corporation, 6.80% due 9/16/2003 1,000,000 1,025,669
Consumer-- A+ A1 1,000,000 Commercial Credit Corp., 6% due 4/15/2000 989,095 1,000,480
7.5% A A2 150,000 Equitable Companies Inc., 7% due 4/01/2028 154,570 153,246
Equitable Life Assurance Society of the US+++:
A A2 500,000 6.95% due 12/01/2005 477,983 518,673
A A2 1,000,000 7.70% due 12/01/2015 993,768 1,113,839
A- Baa1 1,000,000 Finova Capital Corp., 6.15% due 3/31/2003 999,433 999,480
----------- -----------
5,114,705 5,320,817
Financial A A2 500,000 Bear Stearns Companies, Inc.,
Services-- 6.70% due 8/01/2003 470,876 510,975
Other-- A+ A1 2,000,000 Dean Witter, Discover & Co., 6.75%
12.2% due 8/15/2000 1,996,792 2,030,360
AA Aa2 750,000 MBIA, Inc., 7.15% due 7/15/2027 748,221 807,712
BBB+ Baa1 1,000,000 PaineWebber Group Inc., 8.875% due
3/15/2005 997,270 1,133,190
A A2 1,000,000 Salomon Smith Barney Holdings, Inc.,
7.375% due 5/15/2007 1,000,600 1,061,270
BBB+ Baa1 750,000 Simon Debartolo Group LP, 7.375% due
6/15/2018+++ 745,070 744,118
AA- Aa3 2,000,000 Travelers Corp. (The), 7.875% due 5/15/2025 2,027,003 2,311,600
----------- -----------
7,985,832 8,599,225
</TABLE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Schedule of Investments (continued) June 30, 1998
<CAPTION>
S&P Moody's Face Value
Industry Rating Rating Amount Issue Cost (Note 1a)
Corporate Bonds & Notes (continued)
<S> <S> <S> <C> <S> <C> <C>
Industrial-- AA- Aa3 $1,500,000 Archer-Daniels-Midland Company, 7.125% due
Consumer 3/01/2013 $ 1,567,934 $ 1,606,920
Goods-- A A2 2,000,000 Bass America, Inc., 6.625% due 3/01/2003 1,940,539 2,031,940
20.3% A A2 463,971 ++Disney Enterprises Inc., 6.85% due
1/10/2007+++ 463,708 476,174
A- Baa1 1,200,000 Goodrich (B.F.) Co. (The), 7% due 4/15/2038 1,192,965 1,233,000
A A2 500,000 J.C. Penney Company, Inc., 7.95% due
4/01/2017 551,040 566,425
AAA Aaa 2,000,000 Johnson & Johnson, 8.72% due 11/01/2024 2,018,552 2,313,500
A A2 1,125,000 May Department Stores Company (The),
10.625% due 11/01/2010 1,329,905 1,526,119
BBB- Baa3 1,000,000 News America, Inc., 7.30% due 4/30/2028+++ 1,006,677 1,028,740
A A2 1,000,000 Philip Morris Companies, Inc., 9% due
1/01/2001 1,009,886 1,061,990
A- A2 2,500,000 Sears, Roebuck & Co., 6.25% due 1/15/2004 2,486,739 2,509,425
----------- -----------
13,567,945 14,354,233
Industrial-- AA Aa2 1,500,000 BP America, 9.375% due 11/01/2000 1,584,652 1,614,210
Energy-- A Aa3 500,000 Dresser Industries, Inc., 7.60% due 8/15/2096 498,573 575,335
3.1% ----------- -----------
2,083,225 2,189,545
Industrial-- BBB+ A3 2,000,000 Applied Materials Inc., 7.125% due 10/15/2017 2,028,742 2,031,500
Manufactur- A A2 500,000 Chrysler Corporation, 7.45% due 3/01/2027 497,677 554,740
ing--5.1% A A2 1,000,000 Weyerhaeuser Co., 7.25% due 7/01/2013 1,041,077 1,054,040
----------- -----------
3,567,496 3,640,280
Transporta- A- A3 1,000,000 Southwest Airlines Co., 7.875% due 9/01/2007 995,468 1,116,400
tion--1.6%
Utilities-- AAA Aaa 500,000 BellSouth Telecommunications Inc., 8.25% due
Communica- 7/01/2032 542,548 547,490
tions--8.2% AA- A2 2,000,000 GTE California, 8.07% due 4/15/2024 2,135,453 2,175,140
AA- A1 1,000,000 SBC Communications Inc., 6.875% due
8/15/2006 1,042,732 1,050,590
AA Aa3 2,000,000 Southwestern Bell Telecommunications, Inc.,
6.125% due 3/01/2000 2,002,778 2,006,520
----------- -----------
5,723,511 5,779,740
Utilities-- A- A3 1,500,000 Detroit Edison Co., 7.22% due 8/01/2002 1,546,522 1,562,685
Electric-- A- A3 500,000 Pennsylvania Power & Light Co., 6.125%
4.5% due 5/01/2001 499,715 501,200
A A2 1,000,000 Virginia Electric & Power Co., 8.625% due
10/01/2024 983,098 1,137,570
----------- -----------
3,029,335 3,201,455
</TABLE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Schedule of Investments (concluded) June 30, 1998
<CAPTION>
S&P Moody's Face Value
Industry Rating Rating Amount Issue Cost (Note 1a)
Corporate Bonds & Notes (concluded)
<S> <S> <S> <C> <S> <C> <C>
Yankee AA- Aa2 $2,000,000 ABN AMRO Bank N.V., 7% due 4/01/2008 (b) $ 2,048,346 $ 2,086,540
Corporates*-- A A1 1,000,000 Ford Capital B.V., 9.50% due 6/01/2010 (b) 1,093,534 1,246,420
11.8% A+ A1 1,500,000 Grand Metropolitan Investment Corp.,
9% due 8/15/2011 (b) 1,796,428 1,842,915
A+ A2 2,000,000 Hydro-Quebec, 7.375% due 2/01/2003 (c) 2,031,066 2,103,340
AA+ Aaa 1,000,000 Swiss Bank Corp. NY, 7.375% due 6/15/2017 (b) 1,064,210 1,089,450
----------- -----------
8,033,584 8,368,665
Yankee A+ A2 500,000 Province of Quebec, 8.80% due 4/15/2003 (a) 545,467 552,190
Sovereign*--
0.8%
Total Corporate Bonds & Notes--97.0% 65,636,910 68,610,372
Short-Term Securities
Repurchase 1,060,000 Nikko Securities International Inc., purchased
Agreements**--1.5% on 6/30/1998 to yield 6.15% to 7/01/1998 1,060,000 1,060,000
Total Short-Term Securities--1.5% 1,060,000 1,060,000
Total Investments--98.5% $66,696,910 69,670,372
===========
Other AssetsLess Liabilities--1.5% 1,081,640
-----------
Net Assets--100.0% $70,752,012
===========
<FN>
*Corresponding industry groups for foreign bonds which are
denominated in US dollars:
(a) Government entity.
(b) Financial institution.
(c) Industrial; other.
**Repurchase Agreements are fully collateralized by US Government
Obligations.
++Subject to principal paydowns.
++++Not rated.
+++The security may be offered and sold to "qualified institutional
buyers" under Rule 144A of the Securities Act of 1933.
See Notes to Financial Statements.
</TABLE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Statement of Assets and Liabilities as of June 30, 1998
<S> <C> <C>
Assets:
Investments, at value (identified cost--$66,696,910) (Note 1a) $ 69,670,372
Cash 92
Interest receivable 1,186,464
Prepaid registration fees and other assets (Note 1d) 51,927
------------
Total assets 70,908,855
------------
Liabilities:
Payables:
Investment adviser (Note 2) $ 31,127
Capital shares redeemed 26,560 57,687
------------
Accrued expenses and other liabilities 99,156
------------
Total liabilities 156,843
------------
Net Assets $ 70,752,012
============
Net Assets Consist of:
Common Stock, $.01 par value, 50,000,000 shares authorized $ 33,063
Paid-in capital in excess of par 69,138,692
Undistributed investment income--net 162,496
Accumulated realized capital losses on investments--net (Note 5) (1,555,701)
Unrealized appreciation on investments--net 2,973,462
------------
Net Assets--Equivalent to $21.40 per share based on 3,306,292 shares outstanding $ 70,752,012
============
See Notes to Financial Statements.
</TABLE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Statement of Operations for the Six Months Ended June 30, 1998
<S> <C> <C>
Investment Income (Note 1c):
Interest and premium and discount earned $ 2,368,386
Expenses:
Investment advisory fees (Note 2) $ 177,940
Transfer agent fees 87,365
Printing and shareholder reports 23,578
Professional fees 18,500
Registration fees (Note 1d) 17,877
Accounting services (Note 2) 12,682
Custodian fees 5,845
Directors' fees and expenses 3,795
Pricing fees 1,943
Other 1,514
------------
Total expenses 351,039
------------
Investment income--net 2,017,347
------------
Realized & Unrealized Gain on Investments--Net (Notes 1c & 3):
Realized gain on investments--net 206,427
Change in unrealized appreciation on investments--net 550,946
------------
Net Increase in Net Assets Resulting from Operations $ 2,774,720
============
See Notes to Financial Statements.
</TABLE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Statements of Changes in Net Assets
<CAPTION>
For the Six For the
Months Ended Year Ended
June 30, December 31,
Increase (Decrease) in Net Assets: 1998 1997
<S> <C> <C>
Operations:
Investment income--net $ 2,017,347 $ 4,290,507
Realized gain on investments--net 206,427 4,240
Change in unrealized appreciation on investments--net 550,946 1,474,823
------------ ------------
Net increase in net assets resulting from operations 2,774,720 5,769,570
------------ ------------
Dividends to Shareholders (Note 1e):
Investment income--net (1,854,851) (4,290,410)
------------ ------------
Net decrease in net assets resulting from dividends to shareholders (1,854,851) (4,290,410)
------------ ------------
Capital Share Transactions (Note 4):
Net decrease in net assets resulting from capital share transactions (2,548,529) (6,846,909)
------------ ------------
Net Assets:
Total decrease in net assets (1,628,660) (5,367,749)
Beginning of period 72,380,672 77,748,421
------------ ------------
End of period* $ 70,752,012 $ 72,380,672
============ ============
<FN>
*Undistributed investment income--net $ 162,496 $ --
============ ============
See Notes to Financial Statements.
</TABLE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Financial Highlights
<CAPTION>
For the Six
The following per share data and ratios have been derived Months
from information provided in the financial statements. Ended
June 30, For the Year Ended December 31,
Increase (Decrease) in Net Asset Value: 1998++++ 1997 1996 1995 1994
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period $ 21.13 $ 20.69 $ 21.59 $ 19.14 $ 21.55
-------- -------- -------- -------- --------
Investment income--net .59 1.22 1.23 1.28 1.18
Realized and unrealized gain (loss) on investments--net .23 .44 (.90) 2.45 (2.41)
-------- -------- -------- -------- --------
Total from investment operations .82 1.66 .33 3.73 (1.23)
-------- -------- -------- -------- --------
Less dividends from investment income--net (.55) (1.22) (1.23) (1.28) (1.18)
-------- -------- -------- -------- --------
Net asset value, end of period $ 21.40 $ 21.13 $ 20.69 $ 21.59 $ 19.14
======== ======== ======== ======== ========
Total Investment Return:
Based on net asset value per share 3.93%++ 8.30% 1.69% 20.05% (5.78%)
======== ======== ======== ======== ========
Ratios to Average Net Assets:
Expenses .99%* .99% 1.12% 1.01% 1.10%
======== ======== ======== ======== ========
Investment income--net 5.67%* 5.84% 5.84% 6.23% 5.80%
======== ======== ======== ======== ========
Supplemental Data:
Net assets, end of period (in thousands) $ 70,752 $ 72,381 $ 77,748 $ 85,402 $ 82,887
======== ======== ======== ======== ========
Portfolio turnover 31% 90% 77% 104% 122%
======== ======== ======== ======== ========
<FN>
*Annualized.
++Aggregate total investment return.
++++Based on average shares outstanding.
See Notes to Financial Statements.
</TABLE>
The Corporate Fund Accumulation Program, Inc.
Notes to Financial Statements
1. Significant Accounting Policies:
The Corporate Fund Accumulation Program, Inc. (the "Program") is
registered under the Investment Company Act of 1940 as a
diversified, open-end management investment company. These unaudited
financial statements reflect all adjustments which are, in the
opinion of management, necessary to a fair statement of the results
for the interim period presented. All such adjustments are of a
normal recurring nature. The following is a summary of significant
accounting policies followed by the Program.
(a) Valuation of securities--Portfolio securities are valued on the
basis of prices furnished by one or more pricing services which
determine prices for normal, institutional-size trading units. In
certain circumstances, portfolio securities are valued at the last
sale price on the exchange that is the primary market for such
securities, or the last quoted bid price for those securities for
which the over-the-counter market is the primary market or for
listed securities in which there were no sales during the day.
Obligations with remaining maturities of sixty days or less
are valued at amortized cost, which approximates market value,
unless this method no longer produces fair valuations. Securities
for which there exists no price quotations or valuations and all
other assets are valued at fair value as determined in good faith by
or on behalf of the Board of Directors of the Program.
(b) Income taxes--It is the Program's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(c) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income (including amortization of
premium and discount) is recognized on the accrual basis. Realized
gains and losses on security transactions are determined on the
identified cost basis.
(d) Prepaid registration fees--Prepaid registration fees are charged
to expense as the related shares are issued.
(e) Dividends to shareholders--Dividends from net investment income
are declared and paid monthly. Distributions of capital gains are
recorded on the ex-dividend dates.
2. Investment Advisory Agreement and
Transactions with Affiliates:
The Program has entered into an Investment Advisory Agreement with
Fund Asset Management, L.P. ("FAM"). The general partner of FAM is
Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
FAM is responsible for the management of the Program's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Program. For such
services, the Program pays a monthly fee of 0.50%, on an annual
basis, of the value of the Program's average daily net assets.
FAM has entered into an Administrative Agreement with Merrill Lynch,
Pierce, Fenner & Smith Inc. ("MLPF&S"), Prudential Securities, Inc.,
Dean Witter Reynolds Inc., and Smith Barney, Inc. (the
"Administrators"), whereby the Administrators perform certain
administrative duties on behalf of FAM. The Administrators receive a
monthly fee from FAM equal to 0.20%, on an annual basis, of the
Program's average daily net assets.
The Corporate Fund Accumulation Program, Inc.
Notes to Financial Statements (concluded)
During the six months ended June 30, 1998, the Program paid Merrill
Lynch Security Pricing Service, an affiliate of MLPF&S, $2,189 for
security price quotations to compute the net asset value of the
Program.
Accounting services are provided to the Program by FAM at cost.
Certain officers and/or directors of the Program are officers and/or
directors of FAM, PSI, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the six months ended June 30, 1998 were $21,678,010 and
$21,405,550, respectively.
Net realized gains for the six months ended June 30, 1998 and net
unrealized gains as of June 30, 1998 were as follows:
Realized Unrealized
Gains Gains
Long-term investments $ 206,427 $ 2,973,462
--------- -----------
Total $ 206,427 $ 2,973,462
========= ===========
As of June 30, 1998, net unrealized appreciation for Federal income
tax purposes aggregated $2,973,462, of which $2,976,364 related to
appreciated securities and $2,902 related to depreciated securities.
The aggregate cost of investments at June 30, 1998 for Federal
income tax purposes was $66,696,910.
4. Capital Share Transactions:
Transactions in capital shares were as follows:
For the Six Months Dollar
Ended June 30, 1998 Shares Amount
Shares sold 308,670 $ 6,534,868
Shares issued to share-
holders in reinvestment of
dividends 80,744 1,719,102
----------- ------------
Total issued 389,414 8,253,970
Shares redeemed (508,618) (10,802,499)
----------- ------------
Net decrease (119,204) $ (2,548,529)
=========== ============
For the Year Ended Dollar
December 31, 1997 Shares Amount
Shares sold 613,648 $ 12,746,143
Shares issued to share-
holders in reinvestment of
dividends 193,493 4,015,580
----------- ------------
Total issued 807,141 16,761,723
Shares redeemed (1,139,219) (23,608,632)
----------- ------------
Net decrease (332,078) $ (6,846,909)
=========== ============
5. Capital Loss Carryforward:
At December 31, 1997, the Program had a net capital loss
carryforward of approximately $1,761,000, all of which expires in
2002. This amount will be available to offset like amounts of any
future taxable gains.
Officers and Directors
Arthur Zeikel--President and Director
Ronald W. Forbes--Director
Cynthia A. Montgomery--Director
Charles C. Reilly--Director
Kevin A. Ryan--Director
Richard R. West--Director
Terry K. Glenn--Executive Vice President
Christopher G. Ayoub--Senior Vice President
Jay C. Harbeck--Senior Vice President
Joseph T. Monagle Jr.--Senior Vice President
Donald C. Burke--Vice President
Gerald M. Richard--Treasurer
Susan B. Baker--Secretary
Custodian and Transfer Agent
The Bank of New York
90 Washington Street
New York, NY 10286
