A MESSAGE TO VARIABLE ANNUITY CONTRACT OWNERS
After significant increases in the Stock
Markets in 1995, the first half of 1996
witnessed increases which were more in line
with long term historical results. As of
this writing, the Dow Jones Industrial
Average increased approximately 5% in value
from the beginning of the year, even after
contending with a correction of about 7% from
its high point. The S&P 500 has increased
since the beginning of 1996 by a smaller
amount of approximately 3%.
While the Stock Markets increased by
relatively small amounts, and are struggling
to hold on to these gains, the yield on the
30 year Treasury Bond increased fairly
significantly from 5.9% at the beginning of
the year, to approximately 7%. Short term
rates, as measured by the 3 month Treasury
Bill, are yielding 5.1% now, which is about
the same as the beginning of the year.
The U.S. Gross Domestic Product for the
first quarter of 1996 increased 2.2% and for
the second quarter the increase is expected
to be near 4.0%. Inflation remains low with
the Consumer Price Index running at 2.8% this
year after last year's 2.5%.
David H. Roe, President
The Outlook. For the balance of 1996, we expect solid economic growth and
continuing moderate inflation with interest rates remaining near current
levels. At the time of this report, macroeconomic indicators are showing mixed
signs. While the expansion is slowing, business profits are expected to
continue to improve, albeit at a slower rate than in 1995.
Name Change. Please note that on July 1, 1996, Bankers Security Life
Insurance Society changed its name to ReliaStar Bankers Security Life Insurance
Company. ReliaStar Bankers Security is part of a group of companies owned by
ReliaStar Financial Corp.
Respectfully,
David H. Roe
President
ReliaStar Bankers Security Life Insurance Company
<PAGE>
<TABLE>
BANKERS SECURITY VARIABLE ANNUITY FUNDS P AND Q FOR THE USA PLAN
STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 1996 (UNAUDITED)
Oppenheimer
--------------------------------------------------------------------
NON-QUALIFIED FUNDS - (P) Capital High Multiple Global
Money Appreciation Income Strategies Securities
ASSETS Fund 144 Fund 145 Fund 146 Fund 147 Fund 148
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Investments (see below)...........................$ 4,124,581 $ 25,880,977 $ 13,293,279 $ 21,836,332 $ 16,917,176
Net receivable from Bankers Security for contract
charges and reserve transfers.................. - - - - -
------------- ------------- ------------- ------------- -------------
4,124,581 25,880,977 13,293,279 21,836,332 16,917,176
LIABILITIES
Net payable to Bankers Security for contract charges
and reserve transfers.......................... 63,756 170,590 260,277 10,317 109,671
------------- ------------- ------------- ------------- -------------
Net Assets $ 4,060,825 $ 25,710,387 $ 13,033,002 $ 21,826,015 $ 16,807,505
============= ============= ============= ============= =============
Accumulation Units Outstanding 2,557,325 8,369,230 4,739,273 9,518,974 10,501,388
============= ============= ============= ============= =============
Accumulation Unit Value $ 1.51 $ 3.07 $ 2.75 $ 2.27 $ 1.60
============= ============= ============= ============= =============
Investments basis data:
Shares Owned 4,124,581 675,920 1,238,889 1,486,476 1,041,698
Net Asset Value $ 1.00 $ 38.29 $ 10.73 $ 14.69 $ 16.24
Cost $ 4,124,581 $ 13,393,004 $ 11,603,506 $ 16,992,010 $ 12,833,764
</TABLE>
<TABLE>
Oppenheimer Alliance
---------------------------------------- ---------------------------
NON-QUALIFIED FUNDS - (P) Strategic Short-Term Growth and
Bond Bond Growth Multi-Market Income
ASSETS Fund 150 Fund 151 Fund 152 Fund 149 Fund 143
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Investments (see below)...........................$ 393,074 $ 98,555 $ 1,675,311 $ 606,875 $ 3,055,570
Net receivable from Bankers Security for contract
charges and reserve transfers.................. 10,411 - - - 31,788
------------- ------------- ------------- ------------- -------------
403,485 98,555 1,675,311 606,875 3,087,358
LIABILITIES
Net payable to Bankers Security for contract charges
and reserve transfers.......................... - 31 195 1,199 -
------------- ------------- ------------- ------------- -------------
Net Assets $ 403,485 $ 98,524 $ 1,675,116 $ 605,676 $ 3,087,358
============= ============= ============= ============= =============
Accumulation Units Outstanding 347,832 94,735 1,222,712 535,996 1,805,473
============= ============= ============= ============= =============
Accumulation Unit Value $ 1.16 $ 1.04 $ 1.37 $ 1.13 $ 1.71
============= ============= ============= ============= =============
Investments basis data:
Shares Owned 79,893 8,630 69,142 59,092 211,020
Net Asset Value $ 4.92 $ 11.42 $ 24.23 $ 10.27 $ 14.48
Cost $ 378,711 $ 100,938 $ 1,470,791 $ 714,470 $ 2,490,263
</TABLE>
<TABLE>
Fidelity
---------------------------------------------------------------------
NON-QUALIFIED FUNDS - (P) Investment Asset Equity Index
Grade Manager Income 500 Growth
ASSETS Fund 174 Fund 175 Fund 172 Fund 176 Fund 171
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Investments (see below)...........................$ 139,915 $ 584,750 $ 2,392,631 $ 1,406,752 $ 2,448,477
Net receivable from Bankers Security for contract
charges and reserve transfers.................. - - 21,448 6,734 14,440
------------- ------------- ------------- ------------- -------------
139,915 584,750 2,414,079 1,413,486 2,462,917
LIABILITIES
Net payable to Bankers Security for contract charges
and reserve transfers.......................... 825 821 - - -
------------- ------------- ------------- ------------- -------------
Net Assets $ 139,090 $ 583,929 $ 2,414,079 $ 1,413,486 $ 2,462,917
============= ============= ============= ============= =============
Accumulation Units Outstanding 135,039 499,085 1,962,666 1,104,286 1,939,305
============= ============= ============= ============= =============
Accumulation Unit Value $ 1.03 $ 1.17 $ 1.23 $ 1.28 $ 1.27
============= ============= ============= ============= =============
Investments basis data:
Shares Owned 11,979 37,412 122,825 17,602 81,453
Net Asset Value $ 11.68 $ 15.63 $ 19.48 $ 79.92 $ 30.06
Cost $ 143,593 $ 568,548 $ 2,259,602 $ 1,287,311 $ 2,387,804
</TABLE>
<TABLE>
Northstar
---------------------------
NON-QUALIFIED FUNDS - (P) Income and High
Growth Yield Bond
ASSETS Fund 120 Fund 127
------------- -------------
<S> <C> <C>
Investments (see below)...........................$ 94,272 $ 48,021
Net receivable from Bankers Security for contract
charges and reserve transfers.................. - -
------------- -------------
94,272 48,021
LIABILITIES
Net payable to Bankers Security for contract charges
and reserve transfers.......................... 27 109
------------- -------------
Net Assets $ 94,245 $ 47,912
============= =============
Accumulation Units Outstanding 84,147 46,069
============= =============
Accumulation Unit Value $ 1.12 $ 1.04
============= =============
Investments basis data:
Shares Owned 8,099 9,217
Net Asset Value $ 11.64 $ 5.21
Cost $ 93,538 $ 46,526
</TABLE>
<TABLE>
Oppenheimer
--------------------------------------------------------------------
QUALIFIED FUNDS - (Q) Capital High Multiple Global
Money Appreciation Income Strategies Securities
ASSETS Fund 044 Fund 045 Fund 046 Fund 047 Fund 048
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Investments (see below)...........................$ 1,973,785 $ 28,299,680 $ 11,703,222 $ 30,963,729 $ 12,143,135
Net receivable from Bankers Security for contract charges
and reserve transfers.......................... 101,236 - - - -
------------- ------------- ------------- ------------- -------------
2,075,021 28,299,680 11,703,222 30,963,729 12,143,135
LIABILITIES
Net payable to Bankers Security for contract charges
and reserve transfers.......................... - 1,312,354 256,411 233,571 100,367
------------- ------------- ------------- ------------- -------------
Net Assets $ 2,075,021 $ 26,987,326 $ 11,446,811 $ 30,730,158 $ 12,042,768
============= ============= ============= ============= =============
Accumulation Units Outstanding 1,392,632 8,164,487 4,088,147 13,890,486 7,522,927
============= ============= ============= ============= =============
Accumulation Unit Value $ 1.49 $ 3.30 $ 2.80 $ 2.21 $ 1.60
============= ============= ============= ============= =============
Investments basis data:
Shares Owned 1,973,785 739,088 1,090,701 2,107,810 747,730
Net Asset Value $ 1.00 $ 38.29 $ 10.73 $ 14.69 $ 16.24
Cost $ 1,973,785 $ 15,608,428 $ 10,211,798 $ 24,826,883 $ 8,909,031
</TABLE>
<TABLE>
Oppenheimer Alliance
----------------------------------------- -------------------------
QUALIFIED FUNDS - (Q) Strategic Short-Term Growth and
Bond Bond Growth Multi-Market Income
ASSETS Fund 050 Fund 051 Fund 052 Fund 049 Fund 043
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Investments (see below)...........................$ 221,803 $ 103,774 $ 832,688 $ 240,421 $ 3,097,518
Net receivable from Bankers Security for contract charges
and reserve transfers.......................... - 101 - - -
------------- ------------- ------------- ------------- -------------
221,803 103,875 832,688 240,421 3,097,518
LIABILITIES
Net payable to Bankers Security for contract charges
and reserve transfers.......................... 2,158 - 129 6,912 24,407
------------- ------------- ------------- ------------- -------------
Net Assets $ 219,645 $ 103,875 $ 832,559 $ 233,509 $ 3,073,111
============= ============= ============= ============= =============
Accumulation Units Outstanding 187,731 94,432 598,963 206,645 1,763,455
============= ============= ============= ============= =============
Accumulation Unit Value $ 1.17 $ 1.10 $ 1.39 $ 1.13 $ 1.73
============= ============= ============= ============= =============
Investments basis data:
Shares Owned 45,082 $ 9,087 34,366 23,410 213,917
Net Asset Value $ 4.92 $ 11.42 $ 24.23 $ 10.27 $ 14.48
Cost $ 211,622 $ 105,427 $ 752,597 $ 228,325 $ 2,444,604
</TABLE>
<TABLE>
Fidelity
---------------------------------------------------------------------
QUALIFIED FUNDS - (Q) Investment Asset Equity Index
Grade Manager Income 500 Growth
ASSETS Fund 074 Fund 075 Fund 072 Fund 076 Fund 071
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Investments (see below)...........................$ 46,662 $ 384,092 $ 1,627,924 $ 803,436 $ 1,799,452
Net receivable from Bankers Security for contract charges
and reserve transfers.......................... 193 - 1,005 19,324 20,257
------------- ------------- ------------- ------------- -------------
46,855 384,092 1,628,929 822,760 1,819,709
LIABILITIES
Net payable to Bankers Security for contract charges
and reserve transfers.......................... - 495 - - -
------------- ------------- ------------- ------------- -------------
Net Assets $ 46,855 $ 383,597 $ 1,628,929 $ 822,760 $ 1,819,709
============= ============= ============= ============= =============
Accumulation Units Outstanding 37,948 316,398 1,323,366 637,798 1,399,776
============= ============= ============= ============= =============
Accumulation Unit Value $ 1.02 $ 1.16 $ 1.22 $ 1.29 $ 1.30
============= ============= ============= ============= =============
Investments basis data:
Shares Owned 3,995 24,574 83,569 10,053 59,862
Net Asset Value $ 11.68 $ 15.63 $ 19.48 $ 79.92 $ 30.06
Cost $ 46,701 $ 370,956 $ 1,561,027 $ 736,938 $ 1,722,923
</TABLE>
<TABLE>
Northstar
---------------------------
QUALIFIED FUNDS - (Q) Income and High
Growth Yield Bond Combined
ASSETS Fund 020 Fund 027 (P & Q)
------------- ------------- -------------
<S> <C> <C> <C>
Investments (see below)...........................$ 63,636 $ 30,791 $ 189,332,296
Net receivable from Bankers Security for contract charges
and reserve transfers.......................... - 750 227,687
------------- ------------- -------------
63,636 31,541 189,559,983
LIABILITIES
Net payable to Bankers Security for contract charges
and reserve transfers.......................... 151 - 2,554,773
------------- ------------- -------------
Net Assets $ 63,485 $ 31,541 $ 187,005,210
============= ============= =============
Accumulation Units Outstanding 59,332 30,622 87,178,422
============= ============= =============
Accumulation Unit Value $ 1.07 $ 1.03
============= =============
Investments basis data:
Shares Owned 5,467 5,910
Net Asset Value $ 11.64 $ 5.21
Cost $ 61,727 $ 30,219
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
BANKERS SECURITY VARIABLE ANNUITY FUNDS P AND Q FOR THE USA PLAN
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS
SIX MONTHS ENDED JUNE 30, 1996 (UNAUDITED)
NON-QUALIFIED FUNDS - (P) Fund Fund Fund Fund Fund
144 145 146 147 148
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ 127,773 $ 1,384,370 $ 695,875 $ 1,089,817 $ -
Expenses -
Mortality and expense guarantee fees............. (31,733) (145,629) (84,120) (137,230) (94,672)
------------- ------------- ------------- ------------- -------------
Net investment income (expense).................... 96,040 1,238,741 611,755 952,587 (94,672)
Net realized gain (loss)........................... - 69,637 246,346 29,250 (2,240)
Net unrealized gain (loss) ........................ - 2,604,339 (94,516) 197,744 1,190,836
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 96,040 3,912,717 763,585 1,179,581 1,093,924
Net contracts purchased............................ 108,646 724,436 217,698 336,466 254,046
Transfers among funds, net......................... (76,436) 348,773 (1,697,834) (277,826) 4,681,766
Reserve transfers from (to) Bankers Security....... 3,281 1,163 - 4,739 287
Payments to contract owners -
surrenders and other benefits.................... (526,651) (1,045,798) (1,132,450) (970,120) (512,303)
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. (395,120) 3,941,291 (1,849,001) 272,840 5,517,720
Net assets, beginning of period.................... 4,455,945 21,769,096 14,882,003 21,553,175 11,289,785
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 4,060,825 $ 25,710,387 $ 13,033,002 $ 21,826,015 $ 16,807,505
============= ============= ============= ============= =============
</TABLE>
<TABLE>
NON-QUALIFIED FUNDS - (P) Fund Fund Fund Fund Fund
150 151 152 149 143
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ 14,467 $ 2,955 $ 124,499 $ 44,958 $ 497,525
Expenses -
Mortality and expense guarantee fees............. (2,999) (527) (9,887) (4,363) (18,266)
------------- ------------- ------------- ------------- -------------
Net investment income (expense).................... 11,468 2,428 114,612 40,595 479,259
Net realized gain (loss)........................... 91,563 (213) (920) 6,696 9,658
Net unrealized gain (loss) ........................ (79,476) (2,779) 46,155 (20,749) (246,047)
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 23,555 (564) 159,847 26,542 242,870
Net contracts purchased............................ 54,804 14,667 175,707 3,502 102,788
Transfers among funds, net......................... (2,918,475) 19,074 (57,185) (82,211) 135,124
Reserve transfers from Bankers Security............ - - - - -
Payments to contract owners -
surrenders and other benefits.................... (20) (31) (73,280) (1,602) (87,808)
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. (2,840,136) 33,146 205,089 (53,769) 392,974
Net assets, beginning of period.................... 3,243,621 65,378 1,470,027 659,445 2,694,384
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 403,485 $ 98,524 $ 1,675,116 $ 605,676 $ 3,087,358
============= ============= ============= ============= =============
</TABLE>
<TABLE>
NON-QUALIFIED FUNDS - (P) Fund Fund Fund Fund Fund
174 175 172 176 171
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ 4,784 $ 16,549 $ 76,658 $ 43,676 $ 134,967
Expenses -
Mortality and expense guarantee fees............. (615) (2,653) (12,024) (7,280) (13,442)
------------- ------------- ------------- ------------- -------------
Net investment income (expense).................... 4,169 13,896 64,634 36,396 121,525
Net realized gain (loss)........................... (52) (1,744) (1,184) (35) (20,194)
Net unrealized gain (loss) ........................ (5,943) 7,562 25,234 81,819 94,147
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... (1,826) 19,714 88,684 118,180 195,478
Net contracts purchased............................ 47,831 102,686 283,285 654,595 425,819
Transfers among funds, net......................... 33,585 278,030 501,147 174,517 48,278
Reserve transfers from Bankers Security............ - - - - -
Payments to contract owners -
surrenders and other benefits.................... (1,939) (2,777) (15,167) (2,586) (46,739)
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. 77,651 397,653 857,949 944,706 622,836
Net assets, beginning of period.................... 61,439 186,276 1,556,130 468,780 1,840,081
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 139,090 $ 583,929 $ 2,414,079 $ 1,413,486 $ 2,462,917
============= ============= ============= ============= =============
</TABLE>
<TABLE>
NON-QUALIFIED FUNDS - (P) Fund Fund
120 127
------------- -------------
<S> <C> <C>
Income -
Reinvested dividends............................$ 1,198 $ 1,712
Expenses -
Mortality and expense guarantee fees............. (277) (219)
------------- -------------
Net investment income (expense).................... 921 1,493
Net realized gain (loss)........................... - -
Net unrealized gain (loss) ........................ 628 1,195
------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 1,549 2,688
Net contracts purchased............................ 8,551 20,238
Transfers among funds, net......................... 75,000 -
Reserve transfers from Bankers Security............ - -
Payments to contract owners -
surrenders and other benefits.................... (10) -
------------- -------------
Net increase (decrease) in net assets.............. 85,090 22,926
Net assets, beginning of period.................... 9,155 24,986
------------- -------------
Net assets, end of period.........................$ 94,245 $ 47,912
============= =============
</TABLE>
<TABLE>
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS
SIX MONTHS ENDED JUNE 30, 1995 (UNAUDITED)
NON-QUALIFIED FUNDS - (P) Fund Fund Fund Fund Fund
144 145 146 147 148
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ 173,673 $ 95,215 $ 638,609 $ 1,331,298 $ 342,019
Expenses -
Mortality and expense guarantee fees............. (37,269) (110,095) (93,732) (147,967) (80,103)
------------- ------------- ------------- ------------- -------------
Net investment income (expense).................... 136,404 (14,880) 544,877 1,183,331 261,916
Net realized gain (loss)........................... - 17,137 65,562 126,088 (483,333)
Net unrealized gain (loss) ........................ - 2,086,007 835,219 1,631,081 289,353
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 136,404 2,088,264 1,445,658 2,940,500 67,936
Net contracts purchased............................ 389,693 394,665 426,756 315,827 327,641
Transfers among funds, net......................... (694,206) (1,009,363) (1,224,429) 1,207,513 (1,728,663)
Payments to contract owners -
surrenders and other benefits.................... (2,040,183) (672,241) (2,359,075) (2,844,897) (665,646)
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. (2,208,292) 801,325 (1,711,090) 1,618,943 (1,998,732)
Net assets, beginning of period.................... 7,489,463 18,612,693 15,755,387 20,878,549 14,909,797
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 5,281,171 $ 19,414,018 $ 14,044,297 $ 22,497,492 $ 12,911,065
============= ============= ============= ============= =============
</TABLE>
<TABLE>
NON-QUALIFIED FUNDS - (P) Fund Fund Fund Fund Fund
150 151 152 149 143
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ 38,709 $ 265 $ - $ - $ 41,930
Expenses -
Mortality and expense guarantee fees............. (4,151) (5) (786) (7,409) (12,742)
------------- ------------- ------------- ------------- -------------
Net investment income (expense).................... 34,558 260 (786) (7,409) 29,188
Net realized gain (loss)........................... 66 - 183 (11,824) 4,809
Net unrealized gain (loss) ........................ 23,837 (400) 25,615 25,332 324,714
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 58,461 (140) 25,012 6,099 358,711
Net contracts purchased............................ 29,002 19,749 49,191 11,441 53,199
Transfers among funds, net......................... 1,999,426 - 592,904 (106,293) 76,478
Payments to contract owners -
surrenders and other benefits.................... - - (569) (119,327) (142,161)
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. 2,086,889 19,609 666,538 (208,080) 346,227
Net assets, beginning of period.................... - - - 1,286,358 1,877,208
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 2,086,889 $ 19,609 $ 666,538 $ 1,078,278 $ 2,223,435
============= ============= ============= ============= =============
</TABLE>
<TABLE>
NON-QUALIFIED FUNDS - (P) Fund Fund Fund Fund Fund
174 175 172 176 171
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ - $ - $ 326 $ - $ -
Expenses -
Mortality and expense guarantee fees............. - (3) (113) (38) (32)
------------- ------------- ------------- ------------- -------------
Net investment income (expense).................... - (3) 213 (38) (32)
Net realized gain (loss)........................... - - - - -
Net unrealized gain (loss) ........................ 2 47 1,090 939 1,881
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 2 44 1,303 901 1,849
Net contracts purchased............................ - 6,351 57,795 100 15,946
Transfers among funds, net......................... 621 - 72,694 31,380 24,124
Payments to contract owners -
surrenders and other benefits.................... - - - - -
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. 623 6,395 131,792 32,381 41,919
Net assets, beginning of period.................... - - - - -
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 623 $ 6,395 $ 131,792 $ 32,381 $ 41,919
============= ============= ============= ============= =============
</TABLE>
<TABLE>
NON-QUALIFIED FUNDS - (P) Fund Fund
120 127
------------- -------------
<S> <C> <C>
Income -
Reinvested dividends............................$ 18 $ -
Expenses -
Mortality and expense guarantee fees............. (2) -
------------- -------------
Net investment income (expense).................... 16 -
Net realized gain (loss)........................... - -
Net unrealized gain (loss) ........................ 9 -
------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 25 -
Net contracts purchased............................ 2,000 -
Transfers among funds, net......................... - -
Payments to contract owners -
surrenders and other benefits.................... - -
------------- -------------
Net increase (decrease) in net assets.............. 2,025 -
Net assets, beginning of period.................... - -
------------- -------------
Net assets, end of period.........................$ 2,025 $ -
============= =============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
BANKERS SECURITY VARIABLE ANNUITY FUNDS P AND Q FOR THE USA PLAN
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS (continued)
SIX MONTHS ENDED JUNE 30, 1996 (UNAUDITED)
QUALIFIED FUNDS - (Q) Fund Fund Fund Fund Fund
044 045 046 047 048
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ 72,099 $ 1,530,037 $ 601,474 $ 1,544,556 $ -
Expenses -
Mortality and expense guarantee fees............. (18,037) (155,215) (74,540) (192,739) (71,346)
------------- ------------- ------------- ------------- -------------
Net investment income (expense).................... 54,062 1,374,822 526,934 1,351,817 (71,346)
Net realized gain (loss)........................... - 213,867 111,753 95,334 (9,351)
Net unrealized gain (loss) ........................ - 2,795,133 59,811 221,638 888,862
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 54,062 4,383,822 698,498 1,668,789 808,165
Net contracts purchased............................ 201,239 779,503 346,577 615,045 407,257
Transfers among funds, net......................... (32,485) 412,750 (1,214,315) (221,967) 1,949,190
Reserve transfers from Bankers Security............ - 1,337 - 688 67
Payments to contract owners -
surrenders and other benefits.................... (317,244) (1,740,421) (1,092,704) (2,044,850) (773,674)
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. (94,428) 3,836,991 (1,261,944) 17,705 2,391,005
Net assets, beginning of period.................... 2,169,449 23,150,335 12,708,755 30,712,453 9,651,763
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 2,075,021 $ 26,987,326 $ 11,446,811 $ 30,730,158 $ 12,042,768
============= ============= ============= ============= =============
</TABLE>
<TABLE>
QUALIFIED FUNDS - (Q) Fund Fund Fund Fund Fund
050 051 052 049 043
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ 10,446 $ 3,332 $ 44,742 $ 17,811 $ 502,680
Expenses -
Mortality and expense guarantee fees............. (1,807) (686) (4,081) (1,552) (18,867)
------------- ------------- ------------- ------------- -------------
Net investment income (expense).................... 8,639 2,646 40,661 16,259 483,813
Net realized gain (loss)........................... 49,675 (795) 1,111 902 8,452
Net unrealized gain (loss) ........................ (44,575) (3,442) 23,673 (7,043) (235,138)
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 13,739 (1,591) 65,445 10,118 257,127
Net contracts purchased............................ 25,279 66,747 79,050 14,124 137,860
Transfers among funds, net......................... (1,175,335) (34,599) 221,895 (18,028) (106,737)
Reserve transfers from Bankers Security............ - - - - (312)
Payments to contract owners -
surrenders and other benefits.................... (1,743) (1,759) (19,617) (12,154) (63,580)
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. (1,138,060) 28,798 346,773 (5,940) 224,358
Net assets, beginning of period.................... 1,357,705 75,077 485,786 239,449 2,848,753
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 219,645 $ 103,875 $ 832,559 $ 233,509 $ 3,073,111
============= ============= ============= ============= =============
</TABLE>
<TABLE>
QUALIFIED FUNDS - (Q) Fund Fund Fund Fund Fund
074 075 072 076 071
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ 308 $ 15,602 $ 39,135 $ 17,695 $ 82,159
Expenses -
Mortality and expense guarantee fees............. (541) (1,852) (7,804) (4,196) (9,047)
------------- ------------- ------------- ------------- -------------
Net investment income (expense).................... (233) 13,750 31,331 13,499 73,112
Net realized gain (loss)........................... (2,042) (1,256) (1,244) 2,406 (15,415)
Net unrealized gain (loss) ........................ (197) 2,447 18,527 37,477 79,565
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... (2,472) 14,941 48,614 53,382 137,262
Net contracts purchased............................ 14,705 122,172 331,024 111,978 414,835
Transfers among funds, net......................... 138,231 91,009 550,454 454,818 395,368
Reserve transfers from Bankers Security............ (66) (356) (2,156) - -
Payments to contract owners -
surrenders and other benefits.................... (109,553) (29,126) (36,158) (149,601) (197,307)
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. 40,845 198,640 891,778 470,577 750,158
Net assets, beginning of period.................... 6,010 184,957 737,151 352,183 1,069,551
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 46,855 $ 383,597 $ 1,628,929 $ 822,760 $ 1,819,709
============= ============= ============= ============= =============
</TABLE>
<TABLE>
QUALIFIED FUNDS - (Q) Fund Fund Combined
020 027 (P & Q)
------------- ------------- -------------
<S> <C> <C> <C>
Income -
Reinvested dividends............................$ 913 $ 1,357 $ 8,746,129
Expenses -
Mortality and expense guarantee fees............. (346) (173) (1,128,765)
------------- ------------- -------------
Net investment income (expense).................... 567 1,184 7,617,364
Net realized gain (loss)........................... (14) 559 880,510
Net unrealized gain (loss) ........................ 1,202 293 7,638,382
------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 1,755 2,036 16,136,256
Net contracts purchased............................ 10,853 26,056 7,240,069
Transfers among funds, net......................... 6,120 (31,704) 2,569,992
Reserve transfers from Bankers Security............ - - 8,672
Payments to contract owners -
surrenders and other benefits.................... (53) (3) (11,008,828)
------------- ------------- -------------
Net increase (decrease) in net assets.............. 18,675 (3,615) 14,946,161
Net assets, beginning of period.................... 44,810 35,156 172,059,049
------------- ------------- -------------
Net assets, end of period.........................$ 63,485 $ 31,541 $ 187,005,210
============= ============= =============
</TABLE>
<TABLE>
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS (continued)
SIX MONTHS ENDED JUNE 30, 1995 (UNAUDITED)
QUALIFIED FUNDS - (Q) Fund Fund Fund Fund Fund
044 045 046 047 048
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ 95,598 $ 111,627 $ 569,028 $ 1,622,234 $ 282,598
Expenses -
Mortality and expense guarantee fees............. (20,767) (125,317) (77,285) (186,038) (70,811)
------------- ------------- ------------- ------------- -------------
Net investment income.............................. 74,831 (13,690) 491,743 1,436,196 211,787
Net realized gain (loss)........................... - (281,985) (61,617) 63,613 (463,278)
Net unrealized loss ............................... - 2,640,309 837,513 2,178,516 303,640
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 74,831 2,344,634 1,267,639 3,678,325 52,149
Net contracts purchased............................ 204,804 867,435 830,876 1,228,137 560,474
Transfers among funds, net......................... (797,665) (1,952,404) (527,942) 2,427,137 (2,072,069)
Payments to contract owners -
surrenders and other benefits.................... (272,973) (2,609,286) (1,752,727) (2,726,816) (846,852)
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. (791,003) (1,349,621) (182,154) 4,606,783 (2,306,298)
Net assets, beginning of period.................... 3,771,562 21,538,279 12,212,874 25,946,766 13,156,218
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 2,980,559 $ 20,188,658 $ 12,030,720 $ 30,553,549 $ 10,849,920
============= ============= ============= ============= =============
</TABLE>
<TABLE>
QUALIFIED FUNDS - (Q) Fund Fund Fund Fund Fund
050 051 052 049 043
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ 21,915 $ 159 $ 668 $ - $ 45,965
Expenses -
Mortality and expense guarantee fees............. (2,461) (17) (382) (2,737) (13,629)
------------- ------------- ------------- ------------- -------------
Net investment income.............................. 19,454 142 286 (2,737) 32,336
Net realized gain (loss)........................... 303 229 25 (7,443) 4,103
Net unrealized loss ............................... 15,646 (116) 12,137 11,404 354,599
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... 35,403 255 12,448 1,224 391,038
Net contracts purchased............................ 26,169 18,817 77,837 6,423 82,911
Transfers among funds, net......................... 1,170,231 (189) 232,832 (43,917) 35,566
Payments to contract owners -
surrenders and other benefits.................... (40,950) - (3,660) (23,153) (170,951)
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. 1,190,853 18,883 319,457 (59,423) 338,564
Net assets, beginning of period.................... - - - 531,218 2,019,071
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ 1,190,853 $ 18,883 $ 319,457 $ 471,795 $ 2,357,635
============= ============= ============= ============= =============
</TABLE>
<TABLE>
QUALIFIED FUNDS - (Q) Fund Fund Fund Fund Fund
074 075 072 076 071
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Income -
Reinvested dividends............................$ - $ - $ 836 $ - $ -
Expenses -
Mortality and expense guarantee fees............. - (21) (53) (41) (28)
------------- ------------- ------------- ------------- -------------
Net investment income.............................. - (21) 783 (41) (28)
Net realized gain (loss)........................... - - - - -
Net unrealized loss ............................... - 211 401 1,038 1,342
------------- ------------- ------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... - 190 1,184 997 1,314
Net contracts purchased............................ - 18,506 48,868 23,933 15,301
Transfers among funds, net......................... - 35,376 61,699 38,403 63,711
Payments to contract owners -
surrenders and other benefits.................... - - (3) (3) -
------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets.............. - 54,072 111,748 63,330 80,326
Net assets, beginning of period.................... - - - - -
------------- ------------- ------------- ------------- -------------
Net assets, end of period.........................$ - $ 54,072 $ 111,748 $ 63,330 $ 80,326
============= ============= ============= ============= =============
</TABLE>
<TABLE>
QUALIFIED FUNDS - (Q) Fund Fund Combined
020 027 (P & Q)
------------- ------------- -------------
<S> <C> <C> <C>
Income -
Reinvested dividends............................$ - $ - $ 5,412,690
Expenses -
Mortality and expense guarantee fees............. - - (994,034)
------------- ------------- -------------
Net investment income.............................. - - 4,418,656
Net realized gain (loss)........................... - - (1,027,362)
Net unrealized loss ............................... - - 11,601,366
------------- ------------- -------------
Increase (decrease) in net assets resulting from
operations....................................... - - 14,992,660
Net contracts purchased............................ - - 6,109,847
Transfers among funds, net......................... - - (2,087,045)
Payments to contract owners -
surrenders and other benefits.................... - - (17,291,473)
------------- ------------- -------------
Net increase (decrease) in net assets.............. - - 1,723,989
Net assets, beginning of period.................... - - 159,985,443
------------- ------------- -------------
Net assets, end of period.........................$ - $ - $ 161,709,432
============= ============= =============
See accompanying notes to financial statements.
</TABLE>
<TABLE>
BANKERS SECURITY VARIABLE ANNUITY FUNDS P AND Q FOR THE USA PLAN
NOTES TO FINANCIAL STATEMENTS
June 30, 1996
Note 1 - Organization
Bankers Security Variable Annuity Funds P and Q for The USA Plan (the
"Separate Accounts") were established under the provisions of New York
insurance laws by Bankers Security Life Insurance Society ("Bankers Security")
in April 1987 (Funds 144, 145, 146, 147, 044, 045, 046 and 047), in November
1990 (Funds 148, 149, 048 and 049), in December 1990 (Fund 043), in January
1991 (Fund 143), in April 1995 (Funds 150, 151, 152, 050, 051, and 052), and
in May 1995 (Funds 174, 175, 172, 176, 171, 120, 127, 074, 075, 072, 076, 071,
020 and 027). The Separate Accounts are registered with the Securities and
Exchange Commission as a unit investment trust under the Investment Company Act
of 1940, as amended (the "Act"), and are used to fund certain benefits for
variable annuity policies issued by Bankers Security. The assets of the
Separate Accounts are invested in open-end diversified management investment
companies registered under the Act.
Note 2 - Investments
Security transactions are recorded on the trade date at the purchase cost or
sales proceeds, as applicable. Investments owned are valued at closing market
quotations. The difference between beginning of year value and current
market value of investments owned is recorded as an unrealized gain (loss) on
investments. Dividends received are generally recorded as income on the
record date and are reinvested to purchase additional mutual fund shares. The
aggregate cost of shares acquired and the aggregate proceeds from shares sold
for the six months ended June 30, 1996, were:
Cost of Proceeds Cost of Proceeds Cost of Proceeds
Shares from Shares from Shares from
Fund Acquired Shares Sold Fund Acquired Shares Sold Fund Acquired Shares Sold
<S> <C> <C> <S> <C> <C> <S> <C> <C>
144 $4,795,018 $ 5,186,328 175 $ 453,018 $ 60,345 050 $ 56,987 $ 1,266,811
145 3,764,748 2,527,648 172 938,402 126,259 051 76,013 42,961
146 3,606,133 4,493,658 176 906,539 50,367 052 397,674 75,088
147 1,871,340 1,838,182 171 879,746 345,494 049 38,220 35,495
148 5,455,200 1,077,900 120 84,489 3 043 752,613 293,789
150 124,154 2,945,071 127 21,840 73 074 152,214 109,253
151 74,608 7,054 044 4,898,310 5,018,445 075 224,068 25,468
152 469,270 313,565 045 2,882,529 2,230,336 072 951,680 77,365
149 47,312 86,724 046 2,559,541 3,993,687 076 572,292 160,336
143 771,818 160,069 047 2,100,876 2,456,692 071 1,143,894 477,341
174 85,137 654 048 3,619,412 2,096,143 020 19,586 1,343
027 35,383 40,462
</TABLE>
Note 3 - Taxes
Bankers Security is taxed as a life insurance company under the Internal
Revenue Code of 1986, as amended (the "Code"). Since the Separate Accounts are
not separate entities from Bankers Security, and their operations form a part
of Bankers Security, they will not be taxed separately as a "regulated
investment company" under Sub-chapter M of the Code. Under existing Federal
income tax law, investment income of the Separate Accounts, to the extent that
it is applied to increase reserves under a contract, is not taxed and may be
compounded through reinvestment without additional tax to Bankers Security.
Note 4 - Charges and Transfers
Bankers Security does not deduct a sales charge from purchase payments made for
these contracts. All or a portion of the accumulated value may be withdrawn
during the accumulation period. However, purchase payments that are partially
or totally withdrawn from the contract prior to eight years from their date of
payment will be charged (with certain exceptions) a contingent deferred sales
charge of a percentage of the amount of the purchase payment withdrawn. No
such charge will be imposed against withdrawals of purchase payments held for
at least eight years. The withdrawn amounts shall be considered withdrawals of
purchase payments until the total of all purchase payments in the accumulated
value have been withdrawn. A contingent deferred sales charge will not be made
against that portion of withdrawals which are in excess of the total of all
purchase payments.
Within the period applicable to the contingent deferred sales charge for
purchase payments, the contract owner may surrender up to 10% of such purchase
payments held for at least one year, within stated guidelines, without paying a
contingent deferred sales charge. This "free withdrawal" amount is cumulative
to 20% of such purchase payments if no withdrawals are taken for a two year
period.
Bankers Security deducts a daily charge equal to an annual rate of 1.25% of the
daily asset value of the Separate Accounts for mortality and expense risks
assumed. In addition, on each contract anniversary, Bankers Security will
deduct an annual maintenance charge of $30 from the accumulated value of the
contract. Where applicable, premium taxes are charged.
The amount of reserves for contracts in the distribution period is determined
by actuarial assumptions which meet statutory requirements. Gains and losses
resulting from actual mortality experience, the full responsibility for which
is assumed by Bankers Security, are offset by transfers to, or from, Bankers
Security.
Note 5 - Transfers Among Funds
Bankers Security established a fixed fund in 1989 to which contract owners in
the Separate Accounts could transfer all or part of their contract equity.
This fund is reported in the General Account of Bankers Security. Transfer
activity to/from the fixed annuity fund is included in Transfers Among Funds
in the Statements of Operations and Changes in Net Assets. Net transfers to
the fixed fund approximated $2,575,000 for the six months ended June 30, 1996.
Note 6 - Related Parties and Subsequent Event
On January 17, 1995, Bankers Security became an indirect wholly-owned
subsidiary of ReliaStar Financial Corp. ("ReliaStar"), an insurance holding
company based in Minneapolis, Minnesota. In conjunction with this merger, in
May 1995, the Northstar Income and Growth, and High Yield Bond Funds were
added as investment options. These Funds are affiliates of Bankers Security
through ReliaStar.
The New York Insurance Department has approved a name change for Bankers
Security, effective July 1, 1996, to ReliaStar Bankers Security Life Insurance
Company. Policyowner notifications will be mailed once other states approvals
are obtained.
Note 7 - Supplementary Information
Accumulation unit values for a unit of the funds outstanding at June 30, were:
<TABLE>
Fund 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
144 $ 1.51 $ 1.46 $ 1.40 $ 1.37 $ 1.34 $ 1.29 $ 1.22 $ 1.14 $ 1.06 $ 1.00
145 3.07 2.22 1.81 1.80 1.38 1.19 1.20 1.16 0.97 n/a
146 2.75 2.41 2.24 2.12 1.74 1.42 1.21 1.16 1.06 n/a
147 2.27 2.03 1.77 1.73 1.54 1.36 1.31 1.29 1.12 1.02
148 1.60 1.48 1.49 1.13 1.06 0.94 n/a n/a n/a n/a
150 1.16 1.05 n/a n/a n/a n/a n/a n/a n/a n/a
151 1.04 0.99 n/a n/a n/a n/a n/a n/a n/a n/a
152 1.37 1.11 n/a n/a n/a n/a n/a n/a n/a n/a
149 1.13 1.04 1.10 1.10 1.08 1.03 n/a n/a n/a n/a
143 1.71 1.39 1.15 1.12 1.00 1.00 n/a n/a n/a n/a
174 1.03 1.00 n/a n/a n/a n/a n/a n/a n/a n/a
175 1.17 1.02 n/a n/a n/a n/a n/a n/a n/a n/a
172 1.23 1.02 n/a n/a n/a n/a n/a n/a n/a n/a
176 1.28 1.03 n/a n/a n/a n/a n/a n/a n/a n/a
171 1.27 1.06 n/a n/a n/a n/a n/a n/a n/a n/a
120 1.12 1.01 n/a n/a n/a n/a n/a n/a n/a n/a
127 1.04 n/a n/a n/a n/a n/a n/a n/a n/a n/a
044 1.49 1.44 1.39 1.36 1.33 1.28 1.21 1.13 1.05 1.00
045 3.30 2.39 1.95 1.94 1.48 1.27 1.27 1.25 1.04 1.00
046 2.80 2.46 2.28 2.16 1.78 1.45 1.23 1.18 1.08 1.01
047 2.21 1.97 1.72 1.69 1.50 1.33 1.28 1.26 1.10 1.02
048 1.60 1.48 1.49 1.13 1.06 0.94 n/a n/a n/a n/a
050 1.17 1.06 n/a n/a n/a n/a n/a n/a n/a n/a
051 1.10 1.05 n/a n/a n/a n/a n/a n/a n/a n/a
052 1.39 1.12 n/a n/a n/a n/a n/a n/a n/a n/a
049 1.13 1.04 1.10 1.09 1.08 1.03 n/a n/a n/a n/a
043 1.73 1.41 1.17 1.13 1.01 1.01 n/a n/a n/a n/a
074 1.02 n/a n/a n/a n/a n/a n/a n/a n/a n/a
075 1.16 1.01 n/a n/a n/a n/a n/a n/a n/a n/a
072 1.22 1.01 n/a n/a n/a n/a n/a n/a n/a n/a
076 1.29 1.03 n/a n/a n/a n/a n/a n/a n/a n/a
071 1.30 1.09 n/a n/a n/a n/a n/a n/a n/a n/a
020 1.07 n/a n/a n/a n/a n/a n/a n/a n/a n/a
027 1.03 n/a n/a n/a n/a n/a n/a n/a n/a n/a
</TABLE>
