<PAGE>
CURRENT INCOME SHARES, INC.
- --------------------------------------------------------------------------------
DIRECTORS
Lorenzo D. Courtright* Clark R. Gates
Morris A. Densmore* William R. Howell*
Stephen J. Dunn* Michael L. Noel*
*Serve as members of the Audit Committee
OFFICERS
Morris A. Densmore CHAIRMAN
Clark R. Gates PRESIDENT
James V. Atkinson VICE PRESIDENT AND
PORTFOLIO
MANAGER
Richard H. Earnest VICE PRESIDENT
Kevin A. Rogers VICE PRESIDENT
Paul Mastin TREASURER
Jonathan A. Wright SECRETARY
AUDITORS
Arthur Andersen LLP
701 "B" Street (1600)
San Diego, CA 92101
CUSTODIAN
Bankers Trust Company
16 Wall Street
New York, N.Y. 10015
TRANSFER & DIVIDEND
REINVESTMENT PLAN AGENT
Harris Trust Company of California
311 West Monroe St. (11th Floor)
Chicago, IL 60606
(800) 554-3406
COMPANY MAILING ADDRESS
Current Income Shares, Inc.
P.O. Box 3100
Terminal Annex
Los Angeles, California 90030
COMPANY TELEPHONE
(800) 634-6521
NYSE SYMBOL
"CUR"
SEMI-ANNUAL REPORT
JUNE 30, 1996
Investment Adviser:
MERUS-UCA
CAPITAL MANAGEMENTSM
A DIVISION OF
UNION BANK OF CALIFORNIA, N.A.
445 South Figueroa Street
Los Angeles, California 90071
<PAGE>
- --------------------------------------------------------------------------------
CURRENT INCOME SHARES, INC.
- --------------------------------------------------------------------------------
Dear Shareholder:
We are pleased to report to you the results of the operation of your Company
for the first half of 1996. During the six month period, net investment income
was $1,507,697. Quarterly dividends per share paid were 14.44 cents for the
first quarter and 22 cents for the second quarter. In addition a capital gains
distribution of 5.56 cents was also paid in the first quarter bringing the total
first quarter payout per share to 20 cents and total first half year payout per
share to 42 cents. During the first half of the year net assets decreased
$2,946,942, a culmination of declining bond prices and the capital gain payout.
Net asset value also decreased similarly from 13.64 per share to 12.84 exclusive
of the 42 cent payout to shareholders.
With the exception of 1994, the first six months of this year have generated
the worst first half bond market performance since 1994. Interest rates have
continued their upward trend as the ten-year Treasury reached a yield of 6.7%,
and the thirty-year bond ended the second quarter at a yield of 6.9%. Both the
Government and corporate sectors gained .5% for the quarter, while
mortgage-backed securities returned .8%, primarily due to their shorter
durations. Despite already narrow spreads, corporate bonds continued to benefit
from gradual spread tightening, especially among lower quality issues. Bond
market returns were positive for the second quarter despite rising interest
rates, as coupon income was enough to overcome lower prices.
Only a sharp rally in the final week prevented June from becoming the fifth
consecutive month in which interest rates ended the month higher than they
began. Even so, the ten-year Treasury ended the quarter 114 basis points higher
than at year-end. In a reversal of last year, when the economic news tended to
be surprisingly weak, the growth surprises this year have consistently been to
the upside. A series of stunningly robust employment reports has caused a
massive swing in market expectations. Back in January, the two-year Treasury
traded at an average of 40 basis points lower than the federal funds rate,
reflecting the market's expectation that the Federal Reserve would continue to
lower interest rates, while on June 30 the two-year was 85 basis points higher
than fed funds, a swing of 125 basis points.
The strength in employment this year has been impressive, with job growth for
the first six months averaging 233,000 per month, compared to labor force growth
of only 125,000 to 150,000 per month. The gains have been broad based, and with
the unemployment rate now at its lowest level since June of 1990, concern over
wage pressures is beginning to mount. The June employment report revealed a .8%
increase in average hourly earnings, boosting the year-over-year gain to 3.4%, a
new high for this cycle. Having already risen more than 100 basis points in
anticipation of an increase in the fed funds rate to at least 5.75%, most of the
cyclical rise in rates has probably already occurred. However, with the economy
already at full employment, a continuation of the current above-trend growth
would put further upward pressure on interest rates.
Looking forward, we do not believe real GDP will continue at the first half
growth levels but will slow somewhat to around an annual rate of 2.5%, slightly
above the Fed forecast target of 2-2.25%. Whether the Fed moves to tighten
sooner or later will depend on whether the economy does begin to slow in the
third quarter. However, if it does not show signs of slowing quickly, then the
Fed will help with an increase in rates.
The Current Income Shares, Inc. twenty third annual shareholders meeting was
held on March 14, 1996. We continue to appreciate the support of the
shareholders who attended the annual meeting and those who responded by
executing and sending in their proxies.
The unaudited financial statements for the period ended June 30, 1996,
together with the portfolio of investments owned on the same date, are presented
on the following pages. The table below reflects the current portfolio
distribution according to the rating grades assigned by Standard & Poor's.
<TABLE>
<CAPTION>
As a Percent of
Total Investments
Grade in Securities
<S> <C>
- ----- -----------------
AAA............................ 29.10%
AA............................. 0%
A.............................. 22.80%
BBB............................ 32.90%
-------
Subtotal................... 84.80%
BB............................. 14.10%
A-1............................ 1.10%
-------
100.00%
-------
-------
</TABLE>
If you have any questions regarding Current Income Shares, Inc., please
contact us or our transfer agent, Harris Trust Company of California, at the
address or phone number presented on the cover of this report.
[SIGNATURE]
Clark R. Gates
President
July 30, 1996
<PAGE>
- --------------------------------------------------------------------------------
CURRENT INCOME SHARES, INC.
<TABLE>
<S> <C>
STATEMENT OF ASSETS AND LIABILITIES STATEMENT OF OPERATIONS
JUNE 30, 1996 FOR THE SIX MONTHS ENDED JUNE 30, 1996
(Unaudited) (Unaudited)
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS
Investments in securities at
market value:
Bonds (Cost $45,838,676)........................................ $ 46,390,041
Cash............................................................ 15,581
Interest Receivable............................................. 802,502
------------
Total Assets.................................................. 47,208,124
------------
LIABILITIES
Accrued expenses................................................ 34,843
------------
NET ASSETS........................................................ $ 47,173,281
------------
------------
Net assets are represented by:
Capital stock, $1 par, 25,000,000
shares authorized, 3,673,334
shares issued and outstanding............................... $ 3,673,334
Paid-in capital in excess of par
value....................................................... 42,977,827
Accumulated net realized losses............................... (192,875)
Unrealized appreciation on
investments................................................. 551,365
Undistributed net investment
income...................................................... 163,630
------------
NET ASSETS........................................................ $ 47,173,281
------------
------------
NET ASSET VALUE PER SHARE
($47,173,281 DIVIDED BY 3,673,334 shares
of common stock outstanding).................................... $12.84
</TABLE>
<TABLE>
<S> <C> <C>
INVESTMENT INCOME
Interest......................................... $ 1,733,814
--------------
Total Investment Income........................ $ 1,733,814
EXPENSES
Investment management
and advisory fees.............................. 120,263
Custodian fees................................... 6,721
Transfer agent fees.............................. 26,478
Directors' fees and
shareholder expenses........................... 14,918
Printing......................................... 16,652
Legal and auditing fees.......................... 20,724
Listing fees -- NYSE............................. 2,494
Insurance expense................................ 10,944
Pricing expense.................................. 430
Taxes............................................ 2,494
Other Expenses................................... 3,999
--------------
Total Expenses................................. 226,117
-----------
Net Investment
Income..................................... $ 1,507,697
-----------
REALIZED AND
UNREALIZED GAINS AND LOSSES
ON INVESTMENTS IN SECURITIES
Realized gain from
securities transactions:
Proceeds from sales............................ $ 49,170,822
Cost of securities
sold.......................................... (49,363,791)
--------------
Net realized (loss) on investments sold...... (192,969)
Unrealized appreciation/
(depreciation) of investments:
Beginning of period............................ 3,270,235
End of period.................................. 551,365
--------------
Net unrealized (depreciation) during the
period..................................... $(2,718,870)
-----------
Net realized and unrealized (losses) on
investments................................ $(2,911,839)
-----------
Net decrease in net assets resulting from
operations...................................... $(1,404,142)
-----------
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
- 2 -
<PAGE>
- --------------------------------------------------------------------------------
CURRENT INCOME SHARES, INC.
STATEMENTS OF CHANGES IN NET ASSETS
(Unaudited)
FOR THE PERIODS ENDED
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS Twelve Months
JUNE 30, DECEMBER 31,
1996 1995
------------ ---------------
<S> <C> <C>
FROM INVESTMENT ACTIVITIES
Net investment income...................................... $ 1,507,697 $ 3,239,415
Net realized gain (loss) on investments sold............... (192,969) 2,730,664
Net unrealized appreciation (depreciation) of investments
during the period........................................ (2,718,870) 3,836,426
------------ ---------------
Net increase (decrease) in net assets resulting from
operations............................................... (1,404,142) 9,806,505
Dividends to shareholders from net investment income....... (1,542,800) (5,424,782)
------------ ---------------
Increase (decrease) in net assets........................ (2,946,942) 4,381,723
NET ASSETS
Beginning of period........................................ 50,120,223 45,738,500
------------ ---------------
End of period [including (under/(over)distributed) net
investment income of $163,630 and $(5,504)
respectively]............................................ $ 47,173,281 $ 50,120,223
------------ ---------------
------------ ---------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
- 3 -
<PAGE>
- --------------------------------------------------------------------------------
CURRENT INCOME SHARES, INC.
PORTFOLIO OF INVESTMENT IN SECURITIES
(Unaudited)
JUNE 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Standard & Poor's Principal Market
Security Rating Amount Value
<S> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------
BONDS -- (98.34%)
- -------------------------------------------------------------------------------------------------------------------
ASSET BACKED (4.06% OF NET ASSETS)
Standard Credit Card 95-9A 6.55%, 10/07/07......................... AAA $2,000,000 $ 1,914,153
- -------------------------------------------------------------------------------------------------------------------
TOTAL ASSET BACKED (Cost $1,998,590) 1,914,153
- -------------------------------------------------------------------------------------------------------------------
BANKS (8.64% OF NET ASSETS)
Bankers Trust Company 7.25%, 01/15/03.............................. A 1,500,000 1,496,250
First Bank of Puerto Rico 7.625%, 12/15/05......................... BB+ 1,000,000 965,000
NationsBank Corporation 7.75%, 08/15/15............................ A- 1,600,000 1,614,000
- -------------------------------------------------------------------------------------------------------------------
TOTAL BANKS (Cost $4,139,255) 4,075,250
- -------------------------------------------------------------------------------------------------------------------
CANADIANS (5.13% OF NET ASSETS)
Nova Scotia Province 8.75%, 04/01/22............................... A- 1,100,000 1,222,375
Saskatchewan Province Deb. 9.375%, 12/15/20........................ BBB+ 1,000,000 1,195,000
- -------------------------------------------------------------------------------------------------------------------
TOTAL CANADIANS (Cost $2,186,933) 2,417,375
- -------------------------------------------------------------------------------------------------------------------
CONSUMER (4.23% OF NET ASSETS)
Ralston Purina Company 7.75%, 10/01/15............................. A- 2,000,000 1,992,500
- -------------------------------------------------------------------------------------------------------------------
TOTAL CONSUMER (Cost $2,088,831) 1,992,500
- -------------------------------------------------------------------------------------------------------------------
ELECTRIC UTILITIES (10.25% OF NET ASSETS)
Chugach Electric Assn., Inc. 9.14%, 03/15/22 A 1,000,000 1,095,000
Houston Industries, Inc. 9.375%, 06/01/01.......................... BBB 2,000,000 2,180,000
UtiliCorp United 8.45%, 11/15/99................................... BBB 1,500,000 1,561,875
- -------------------------------------------------------------------------------------------------------------------
ELECTRIC UTILITIES (Cost $4,598,876) 4,836,875
- -------------------------------------------------------------------------------------------------------------------
ENERGY (4.73% OF NET ASSETS)
Union Oil Co. of California 9.125%, 02/15/06....................... BBB 2,000,000 2,230,000
- -------------------------------------------------------------------------------------------------------------------
TOTAL ENERGY (Cost $2,161,687) 2,230,000
- -------------------------------------------------------------------------------------------------------------------
GAS (7.05% OF NET ASSETS)
Coastal Corporation 9.625%, 05/15/12............................... BB+ 2,000,000 2,297,500
Panhandle Eastern Corporation 7.875%, 08/15/04..................... BBB 1,000,000 1,030,000
- -------------------------------------------------------------------------------------------------------------------
TOTAL GAS (Cost $3,046,024) 3,327,500
- -------------------------------------------------------------------------------------------------------------------
MANUFACTURING (7.12% OF NET ASSETS)
Georgia Pacific Corporation 7.7%, 06/15/15......................... BBB- 750,000 723,750
Lockheed Martin Corporation 7.7%, 06/15/08......................... BBB+ 1,500,000 1,526,250
Westvaco Corporation 10.125%, 06/01/19............................. A 1,000,000 1,110,000
- -------------------------------------------------------------------------------------------------------------------
TOTAL MANUFACTURING (Cost $3,274,668) 3,360,000
- -------------------------------------------------------------------------------------------------------------------
TOTAL OTHER FINANCE (3.09% OF NET ASSETS)
Ford Motor Credit Corporation 5.37%, 07/05/96...................... A-1 500,000 499,999
U.S. West Capital Funding, Inc. 6.75%, 10/01/05.................... A+ 1,000,000 956,250
- -------------------------------------------------------------------------------------------------------------------
TOTAL OTHER FINANCE (Cost $1,500,489) $ 1,456,249
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
- 4 -
<PAGE>
- --------------------------------------------------------------------------------
CURRENT INCOME SHARES, INC.
PORTFOLIO OF INVESTMENTS IN SECURITIES (CONTINUED)
(Unaudited)
JUNE 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Standard & Poor's Principal Market
Security Rating Amount Value
<S> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------
SECURITIES BROKERS (5.37% OF NET ASSETS)
Lehman Brothers Holdings, Inc. Note 8.8%, 03/01/15....................... A $1,000,000 $ 1,098,750
Salomon, Inc. 6.75%, 02/15/03............................................ BBB 1,500,000 1,436,250
- -------------------------------------------------------------------------------------------------------------------------
TOTAL SECURITIES BROKERS (Cost $2,602,798) 2,535,000
- -------------------------------------------------------------------------------------------------------------------------
SERVICE (3.15% OF NET ASSETS)
Loewen Group, Inc. 8.25%, 04/15/03....................................... BB+ 1,500,000 1,486,875
- -------------------------------------------------------------------------------------------------------------------------
TOTAL SERVICE (Cost $1,498,424) 1,486,875
- -------------------------------------------------------------------------------------------------------------------------
TELECOMMUNICATIONS (7.16% OF NET ASSETS)
GTE Corporation 10.3%, 11/15/17.......................................... BBB+ 2,000,000 2,182,500
360 Communication Company 7.5%, 03/01/06................................. BBB- 1,250,000 1,193,750
- -------------------------------------------------------------------------------------------------------------------------
TOTAL TELECOMMUNICATIONS (Cost $3,550,652) 3,376,250
- -------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION (3.78% OF NET ASSETS)
AMR Corporation Deb 10%, 04/15/21........................................ BB+ 1,500,000 1,785,000
- -------------------------------------------------------------------------------------------------------------------------
TOTAL TRANSPORTATION (Cost $1,470,671) 1,785,000
- -------------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT (24.58% OF NET ASSETS)
U.S. Treasury Note 7.5%, 11/15/01........................................ AAA 1,000,000 1,043,990
U.S. Treasury Note 6.5%, 05/15/05........................................ AAA 1,650,000 1,628,055
U.S. Treasury Note 6.25%, 05/31/00....................................... AAA 1,000,000 993,780
U.S. Treasury Note 6.5%, 08/15/05........................................ AAA 3,000,000 2,957,339
U.S. Treasury Note 6.125%, 09/30/00...................................... AAA 2,500,000 2,471,075
U.S. Treasury Note 6.125%, 03/31/98...................................... AAA 2,500,000 2,502,775
- -------------------------------------------------------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT (Cost $11,720,778) 11,597,014
- -------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (98.34% OF NET ASSETS)
(COST $45,838,676) 46,390,041
- -------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET
(1.66% of Net Assets) 783,240
- -------------------------------------------------------------------------------------------------------------------------
NET ASSETS (100.00% OF NET ASSETS) $47,173,281
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
- 5 -
<PAGE>
- --------------------------------------------------------------------------------
CURRENT INCOME SHARES, INC.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
JUNE 30, 1996
- --------------------------------------------------------------------------------
1. Significant Accounting Policies
Current Income Shares, Inc. (the "Company") is registered under the Investment
Company Act of 1940, as amended, as a diversified, closed-end management
investment company. The Company was incorporated on November 15, 1972, and
commenced operations on March 27, 1973. The primary investment objective of the
Company is to seek a high level of current income for its shareholders
consistent with investment in a diversified portfolio in which marketable debt
securities considered by management to be of high quality will predominate. To a
lesser extent the Company may also invest in other debt securities and in
certain equities.
The following is a summary of significant accounting policies followed by the
Company in the preparation of its financial statements. The policies are in
conformity with generally accepted accounting principles.
(a) Security valuation -- Portfolio securities listed or traded on a national
securities exchange are valued at the last reported sales price;
securities traded in the over-the-counter market and listed securities for
which no sales were reported on that date are valued at the most recent
bid price.
(b) Federal income taxes -- It is the Company's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its taxable income and net
capital gains to its shareholders. Accordingly, no Federal income tax
provision is required.
(c) Estimates -- The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amount of income and
expenses during the reporting period. Actual results could differ from
those estimates.
(d) Other -- Security transactions are accounted for on the trade date the
securities are purchased or sold. Purchased discounts and premiums on
securities held are accreted or amortized to interest income over the life
of each security using a method which approximates the effective interest
method. Interest income is recognized on the accrual basis of accounting.
Realized gains and losses are computed using the specific cost of the
securities sold.
2. Purchases and Sales of Securities
Purchases and proceeds of securities other than short-term securities and U.S.
Government obligations aggregated $12,152,976 and $20,265,822, respectively.
Purchases and redemptions of U.S. Government obligations aggregated $8,806,148
and $12,273,078, respectively.
As of June 30, 1996, unrealized appreciation for Federal income tax purposes
aggregated $551,365 of which $1,251,587 related to appreciated securities and
$700,222 related to depreciated securities. The aggregate cost for Federal
income tax purposes was not materially different from amounts reported for
financial reporting purposes.
3. Transactions with Affiliates
Union Bank of California (the "Adviser") received fees of $120,263 during the
six months ended June 30, 1996 for providing investment management and advisory
services to the Company. The fee is based on an annual rate of 0.5% of the
Company's average net assets.
The Advisory Agreement requires that the Adviser reimburse the Company for
expenses (excluding interest, taxes, the expenses of any offering of the
Company's securities and brokerage commissions) incurred by the Company in
excess of one and one-half percent (1 1/2%) per year of the first $30 million of
average net assets of the
- 6 -
<PAGE>
- --------------------------------------------------------------------------------
CURRENT INCOME SHARES, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
JUNE 30, 1996
- --------------------------------------------------------------------------------
Company and one percent (1%) of average net assets in excess of $30 million. The
expenses incurred by the Company for the six months ended June 30, 1996 did not
exceed the limitation established by the Advisory Agreement.
4. Agreements with Service Providers
Harris Trust Company of California provides Transfer Agent and Dividend
Reinvestment Plan services and Bankers Trust Company provides custodial services
for the Company.
5. Financial Highlights
Selected data for each share of capital stock outstanding throughout each
period follows:
<TABLE>
<CAPTION>
01/01/96 TO 01/01/95 to 01/01/94 to 01/01/93 to 01/01/92 to 01/01/91 to
06/30/96 12/31/95 12/31/94 12/31/93 12/31/92 12/31/91
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
Investment Income......................... $ 0.47 $ 1.00 $ 1.06 $ 1.09 $ 1.10 $ 1.19
Expenses.................................. 0.06 0.12 0.12 0.12 0.12 0.12
------------ ------------ ------------ ------------ ------------ ------------
Net Investment Income..................... 0.41 0.88 0.94 0.97 0.98 1.07
Dividends distributed from net Investment
Income.................................. (0.42) (1.48) (0.94) (0.97) (1.03) (1.09)
Net realized and unrealized gain (loss) on
investments............................. (0.79) 1.79 (1.74) 0.86 0.22 1.38
------------ ------------ ------------ ------------ ------------ ------------
Net increase (decrease) in net asset
value................................... (0.80) 1.19 (1.74) 0.86 0.17 1.36
Net asset value:
Beginning of period..................... 13.64 12.45 14.19 13.33 13.16 11.80
------------ ------------ ------------ ------------ ------------ ------------
End of period........................... $ 12.84 $ 13.64 $ 12.45 $ 14.19 $ 13.33 $ 13.16
------------ ------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------ ------------
Per share market value:
End of period........................... $ 10.875 $ 11.875 $ 11.000 $ 13.00 $ 12.625 $ 13.25
Total investment return+.................. (4.94)% 22.25% (8.33)% 10.53% 3.22% 20.51%
RATIOS AND SUPPLEMENTAL DATA
Ratio of expenses to average net assets... 0.9%* 0.9% 0.9% 0.8% 0.9% 0.9%
Ratio of net investment income to average
net assets.............................. 6.2%* 6.6% 7.2% 6.9% 7.5% 8.6%
Portfolio turnover rate................... 42.23% 118.52% 42.21% 24.15% 87.08% 82.38%
Net assets, end of period (000)........... $ 47,173 $ 50,120 $ 45,739 $ 52,137 $ 48,967 $ 48,359
</TABLE>
+ Excluding the effect of shareholders' buy/sell brokerage commissions, if any.
* Annualized
- 7 -
<PAGE>
- --------------------------------------------------------------------------------
CURRENT INCOME SHARES, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
JUNE 30, 1996
- --------------------------------------------------------------------------------
6. Unaudited Quarterly Results of Operations
The following is a summary of unaudited quarterly results of operations:
<TABLE>
<CAPTION>
Net Realized and
Unrealized Gain (Loss)
Net Investment Income on Investments
Investment ------------------------- ---------------------------
Income Amount Per Share Amount Per Share
----------- ------------ ----------- -------------- -----------
<S> <C> <C> <C> <C> <C>
Three months ended:
June 30, 1996....................................... $ 871,085 $ 760,129 $ 0.21 $ (637,224) $ 0.17
March 31, 1996...................................... 862,729 747,568 0.20 (2,274,615) 0.62
December 31, 1995................................... 887,539 750,401 0.21 1,879,952 0.51
September 30, 1995.................................. 922,945 815,939 0.22 503,217 0.14
June 30, 1995....................................... $ 958,845 $ 854,814 $ 0.23 $ 2,635,465 $ 0.72
March 31, 1995...................................... 918,292 818,261 0.22 1,548,456 0.42
December 31, 1994................................... 962,818 856,558 0.24 (576,482) (0.15)
September 30, 1994.................................. 980,816 877,637 0.23 (812,300) (0.22)
</TABLE>
7. Dividend Reinvestment Plan
The Company maintains a Dividend Reinvestment Plan in which shareholders may
participate. The Plan is offered through Harris Trust Company of California (the
"Agent"). Under the Plan the Agent uses dividends and other cash distributions
from the Company to purchase additional shares of Company common stock in the
open market for Plan participants. Participants may also make certain cash
contributions to the Plan. Further information regarding the Plan may be
obtained by writing to the Agent at: Harris Trust Company of California, 311
West Monroe Street (11th floor), Chicago, IL 60606.
- 8 -
