<PAGE> 1
'99
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Nationwide(R) Variable Account - II
June 30, 1999
[THE BEST OF AMERICA (R) LOGO]
SEMI-ANNUAL REPORT
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[LOGO NATIONWIDE]
Nationwide Life Insurance Company
Home Office: Columbus, Ohio
<PAGE> 2
[LOGO NATIONWIDE]
NATIONWIDE LIFE INSURANCE COMPANY
ONE NATIONWIDE PLAZA, COLUMBUS, OHIO 43215-2220
[PICTURE]
PRESIDENT'S MESSAGE
On behalf of Nationwide Life Insurance Company, we are pleased to present the
1999 semi-annual report of the Nationwide Variable Account-II.
Equity investments performed well during the first half of 1999 with the major
market indices showing double-digit gains. Fixed income investments did not fare
as well during this period in the face of the Federal Reserve's inflation
cautiousness. The Fed is mindful of the resilient U.S. economy and the
increasingly tight labor pool that portends future wage inflation. Accordingly,
we have seen a ratcheting-up of short-term interest rates to dampen the momentum
of the current expansion. How aggressively the Fed may react to the perceived
inflation threat only adds uncertainty to the already jittery equity markets.
Over the long term, however, a slower but sustainable rate of growth, with low
inflation, provides a favorable environment for further advances in financial
assets.
At mid-year, we are pleased to report that all the mission-critical systems used
to service our variable annuity and variable life business have been internally
inventoried, assessed and tested as being Year 2000 compliant. We are currently
contacting our critical business partners to determine if they will be Year 2000
compliant. Contingency plans are being developed and are to be completed by the
end of the third quarter. All these steps are being taken to assure that
Nationwide Financial will be able to continue to serve your financial needs into
the Year 2000 and beyond.
Thank you for selecting Nationwide Financial to help you achieve your financial
planning and retirement savings goals. You have our commitment to provide the
consistent, high quality service you expect and deserve.
/s/ Joseph J. Gasper
Joseph J. Gasper, President
August 19, 1999
3
<PAGE> 3
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NATIONWIDE VARIABLE ACCOUNT-II
STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS' EQUITY
JUNE 30, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
ASSETS:
Investments at market value:
<S> <C>
American Century VP - American Century VP Balanced (ACVPBal)
28,531,436 shares (cost $216,902,234) ............................................................$ 210,276,687
American Century VP - American Century VP Capital Appreciation (ACVPCapAp)
24,521,080 shares (cost $234,758,293) ............................................................ 256,735,707
American Century VP - American Century VP Income & Growth (ACVPIncGr)
9,406,831 shares (cost $62,246,971) .............................................................. 69,986,821
American Century VP - American Century VP International (ACVPInt)
37,423,696 shares (cost $279,281,047) ............................................................ 306,125,836
American Century VP - American Century VP Value (ACVPValue)
13,919,175 shares (cost $91,698,783) ............................................................. 94,511,200
American VI Series - Growth Fund (AVISGro)
541,330 shares (cost $23,467,949) ................................................................ 35,224,360
American VI Series - High-Yield Bond Fund (AVISHiYld)
184,219 shares (cost $2,620,858) ................................................................. 2,418,793
American VI Series - U.S. Government/AAA-Rated Securities Fund (AVISGvt)
369,448 shares (cost $4,094,310) ................................................................. 4,004,811
The Dreyfus Socially Responsible Growth Fund, Inc. (DrySRGro)
9,636,025 shares (cost $286,687,414) ............................................................. 337,742,677
Dreyfus Stock Index Fund (DryStkIx)
56,334,848 shares (cost $1,602,533,332) .......................................................... 2,034,251,360
Dreyfus VIF - Capital Appreciation Portfolio (DryCapAp)
5,485,398 shares (cost $189,763,964) ............................................................. 212,943,142
Dreyfus VIF - Growth and Income Portfolio (DryGrInc)
3,290,332 shares (cost $71,046,177) .............................................................. 82,357,016
Fidelity VIP - Equity-Income Portfolio (FidVIPEI)
103,085,902 shares (cost $2,082,815,849) ......................................................... 2,809,090,831
Fidelity VIP - Growth Portfolio (FidVIPGr)
72,260,723 shares (cost $2,605,665,390) .......................................................... 3,304,482,853
Fidelity VIP - High Income Portfolio (FidVIPHI)
61,083,150 shares (cost $714,865,608) ............................................................ 689,628,766
Fidelity VIP - Overseas Portfolio (FidVIPOv)
28,586,163 shares (cost $558,637,021) ............................................................ 594,592,186
Fidelity VIP-II - Asset Manager Portfolio (FidVIPAM)
62,593,230 shares (cost $955,124,087) ............................................................ 1,107,274,245
</TABLE>
4
<PAGE> 4
<TABLE>
<S> <C>
Fidelity VIP-II - Contrafund Portfolio (FidVIPCon)
54,103,873 shares (cost $1,034,278,981) .......................................................... 1,412,111,085
Fidelity VIP-III - Growth Opportunities Portfolio (FidVIPGrOp)
8,387,826 shares (cost $175,604,964) ............................................................. 198,288,200
Morgan Stanley - Emerging Markets Debt Portfolio (MSEmMkt)
1,186,263 shares (cost $8,134,787) ............................................................... 8,173,355
Nationwide SAT - Capital Appreciation Fund (NSATCapAp)
23,703,083 shares (cost $557,239,157) ............................................................ 703,507,507
Nationwide SAT - Government Bond Fund (NSATGvtBd)
35,619,426 shares (cost $417,214,330) ............................................................ 396,444,213
Nationwide SAT - Money Market Fund (NSATMyMkt)
1,098,683,256 shares (cost $1,098,683,256) ....................................................... 1,098,683,256
Nationwide SAT - Small Cap Value Fund (NSATSmCapV)
4,310,919 shares (cost $44,527,859) .............................................................. 47,808,094
Nationwide SAT - Small Company Fund (NSATSmCo)
14,252,079 shares (cost $215,399,879) ............................................................ 245,563,322
Nationwide SAT - Total Return Fund (NSATTotRe)
63,741,690 shares (cost $915,099,621) ............................................................ 1,293,318,880
Neuberger &Berman AMT - Growth Portfolio (NBAMTGro)
16,132,242 shares (cost $394,424,685) ............................................................ 411,856,148
Neuberger & Berman AMT - Guardian Portfolio (NBAMTGuard)
4,129,548 shares (cost $57,391,905) .............................................................. 66,774,797
Neuberger &Berman AMT - Limited Maturity Bond Portfolio (NBAMTLMat)
11,908,063 shares (cost $162,040,102) ............................................................ 155,876,549
Neuberger &Berman AMT - Partners Portfolio (NBAMTPart)
29,820,344 shares (cost $586,031,081) ............................................................ 617,877,528
Oppenheimer VAF - Bond Fund (OppBdFd)
27,496,538 shares (cost $324,756,758) ............................................................ 316,210,182
Oppenheimer VAF - Global Securities Fund (OppGlSec)
24,069,563 shares (cost $485,957,823) ............................................................ 577,428,810
Oppenheimer VAF - Growth Fund (OppGro)
3,595,331 shares (cost $130,646,086) ............................................................. 146,509,742
Oppenheimer VAF - Multiple Strategies Fund (OppMult)
18,734,474 shares (cost $285,841,279) ............................................................ 317,361,997
Strong Opportunity Fund II, Inc. (StOpp2)
36,729,932 shares (cost $728,595,910) ............................................................ 846,992,228
Strong VIF - Strong Discovery Fund II (StDisc2)
13,293,490 shares (cost $154,765,673) ............................................................ 136,125,340
Strong VIF - Strong International Stock Fund II (StIntStk2)
3,976,548 shares (cost $37,030,966) .............................................................. 38,691,807
</TABLE>
(Continued)
5
<PAGE> 5
<TABLE>
<S> <C>
Van Eck WIT - Worldwide Bond Fund (VEWrldBd)
7,292,302 shares (cost $85,225,531) .............................................................. 78,611,012
Van Eck WIT - Worldwide Emerging Markets Fund (VEWrldEMkt)
10,300,591 shares (cost $96,113,889) ............................................................. 107,023,145
Van Eck WIT - Worldwide Hard Assets Fund (VEWrldHAs)
7,062,521 shares (cost $70,498,589) .............................................................. 75,639,600
Van Kampen LIT -
Morgan Stanley Real Estate Securities Portfolio (MSRESec)
9,694,566 shares (cost $147,817,035) ............................................................. 134,657,527
Warburg Pincus Trust - International Equity Portfolio (WPIntEq)
17,533,011 shares (cost $200,811,278) ............................................................ 206,012,880
Warburg Pincus Trust - Post Venture Capital Portfolio (WPPVenCap)
2,018,248 shares (cost $24,764,834) .............................................................. 26,802,328
Warburg Pincus Trust - Small Company Growth Portfolio (WPSmCoGr)
16,258,950 shares (cost $257,841,747) ............................................................ 277,865,464
--------------
Total investments ............................................................................. 22,093,862,287
Accounts receivable .................................................................................... 14,472
--------------
Total assets .................................................................................. 22,093,876,759
ACCOUNTS PAYABLE .......................................................................................... 49,736,193
--------------
CONTRACT OWNERS' EQUITY (NOTE 4) ..........................................................................$ 22,044,140,566
==============
</TABLE>
See accompanying notes to financial statements.
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6
<PAGE> 6
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
Total ACVPBal
------------------------------------ -----------------------------------
1999 1998 1999 1998
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ........................... $ 290,718,942 253,341,101 3,991,181 3,098,368
Mortality, expense and administration
charges (note 2):
BOA ....................................... (78,571,751) (72,825,762) (716,902) (650,306)
BOAVision ................................. (63,528,916) (56,294,722) (682,055) (551,933)
BOAEnterprise ............................. (128,643) (93,329) (1,372) (815)
---------------- ---------------- ---------------- ----------------
Net investment activity ...................... 148,489,630 124,127,288 2,590,852 1,895,314
---------------- ---------------- ---------------- ----------------
Proceeds from mutual fund shares sold .......... 5,882,828,507 4,147,720,751 14,154,195 8,590,626
Cost of mutual fund shares sold ................ (5,354,333,786) (3,697,334,825) (13,036,483) (6,553,087)
---------------- ---------------- ---------------- ----------------
Realized gain (loss) on investments .......... 528,494,721 450,385,926 1,117,712 2,037,539
Change in unrealized gain (loss) on investments 482,864,663 232,401,682 (24,243,869) 491,824
---------------- ---------------- ---------------- ----------------
Net gain (loss) on investments ............... 1,011,359,384 682,787,608 (23,126,157) 2,529,363
---------------- ---------------- ---------------- ----------------
Reinvested capital gains ....................... 744,263,367 1,093,474,941 27,539,149 19,212,723
---------------- ---------------- ---------------- ----------------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 1,904,112,381 1,900,389,837 7,003,844 23,637,400
---------------- ---------------- ---------------- ----------------
Equity transactions:
Purchase payments received from
contract owners .............................. 798,937,993 1,310,371,181 9,412,618 11,800,162
Transfers between funds ........................ -- -- (4,498,643) 20,024,530
Redemptions .................................... (1,308,989,155) (849,043,344) (9,831,682) (7,532,310)
Annuity benefits ............................... (1,449,973) (903,526) (9,440) (1,335)
Annual contract maintenance charge (note 2) .... (4,542,049) (4,274,386) (41,847) (40,220)
Contingent deferred sales charges (note 2) ..... (16,253,266) (11,050,734) (131,274) (120,155)
Adjustments to maintain reserves ............... (349,774) (217,173) (0) 1,094
---------------- ---------------- ---------------- ----------------
Net equity transactions ................... (532,646,223) 444,882,018 (5,100,268) 24,131,766
---------------- ---------------- ---------------- ----------------
Net change in contract owners' equity ............ 1,371,466,158 2,345,271,855 1,903,576 47,769,166
Contract owners' equity beginning of period ...... 20,672,674,408 17,849,801,427 208,373,013 168,733,832
---------------- ---------------- ---------------- ----------------
Contract owners' equity end of period ............ $ 22,044,140,566 20,195,073,282 210,276,589 216,502,998
================ ================ ================ ================
</TABLE>
<TABLE>
<CAPTION>
ACVPCapAp ACVPIncGr
------------------------------------ -----------------------------------
1999 1998 1999 1998
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ........................... -- -- 11,166 --
Mortality, expense and administration
charges (note 2):
BOA ....................................... (1,235,092) (1,608,272) (201,915) (9,919)
BOAVision ................................. (419,291) (478,438) (163,350) (4,921)
BOAEnterprise ............................. (689) (685) (144) (18)
---------------- ---------------- ---------------- ----------------
Net investment activity ...................... (1,655,072) (2,087,395) (354,243) (14,858)
---------------- ---------------- ---------------- ----------------
Proceeds from mutual fund shares sold .......... 91,458,174 75,788,914 11,187,828 10,484,127
Cost of mutual fund shares sold ................ (103,431,218) (85,986,818) (9,782,112) (10,520,048)
---------------- ---------------- ---------------- ----------------
Realized gain (loss) on investments .......... (11,973,044) (10,197,904) 1,405,716 (35,921)
Change in unrealized gain (loss) on investments 48,820,862 (1,561,206) 3,962,843 160,255
---------------- ---------------- ---------------- ----------------
Net gain (loss) on investments ............... 36,847,818 (11,759,110) 5,368,559 124,334
---------------- ---------------- ---------------- ----------------
Reinvested capital gains ....................... -- 15,700,848 -- --
---------------- ---------------- ---------------- ----------------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 35,192,746 1,854,343 5,014,316 109,476
---------------- ---------------- ---------------- ----------------
Equity transactions:
Purchase payments received from
contract owners .............................. 8,354,679 14,082,567 6,006,267 534,036
Transfers between funds ........................ (18,413,937) (44,700,789) 22,851,548 9,792,053
Redemptions .................................... (19,086,761) (20,162,465) (2,549,800) (31,960)
Annuity benefits ............................... (28,306) (28,713) -- --
Annual contract maintenance charge (note 2) .... (105,114) (140,642) (7,137) (433)
Contingent deferred sales charges (note 2) ..... (208,688) (249,534) (42,340) (477)
Adjustments to maintain reserves ............... 1,068 (6,683) (6,397) (16)
---------------- ---------------- ---------------- ----------------
Net equity transactions ................... (29,487,059) (51,206,259) 26,252,142 10,293,203
---------------- ---------------- ---------------- ----------------
Net change in contract owners' equity ............ 5,705,687 (49,351,916) 31,266,458 10,402,679
Contract owners' equity beginning of period ...... 251,055,304 339,991,098 38,714,070 --
---------------- ---------------- ---------------- ----------------
Contract owners' equity end of period ............ 256,760,991 290,639,182 69,980,528 10,402,679
================ ================ ================ ================
</TABLE>
(Continued)
7
<PAGE> 7
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
ACVPInt ACVPValue
------------------------------ ------------------------------
1999 1998 1999 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ -- 1,241,910 591,931 491,657
Mortality, expense and administration
charges (note 2):
BOA ........................................ (962,253) (764,982) (199,110) (222,249)
BOAVision .................................. (1,076,236) (883,590) (274,143) (316,022)
BOAEnterprise .............................. (1,082) (972) (564) (595)
------------- ------------- ------------- -------------
Net investment activity ....................... (2,039,571) (407,634) 118,114 (47,209)
------------- ------------- ------------- -------------
Proceeds from mutual fund shares sold ........... 193,891,495 118,795,827 39,328,817 24,731,350
Cost of mutual fund shares sold ................. (189,829,255) (100,938,867) (42,275,018) (23,255,567)
------------- ------------- ------------- -------------
Realized gain (loss) on investments ........... 4,062,240 17,856,960 (2,946,201) 1,475,783
Change in unrealized gain (loss) on investments . 16,750,075 18,518,546 4,665,167 (3,719,654)
------------- ------------- ------------- -------------
Net gain (loss) on investments ................ 20,812,315 36,375,506 1,718,966 (2,243,871)
------------- ------------- ------------- -------------
Reinvested capital gains ........................ -- 12,749,123 5,607,994 5,869,944
------------- ------------- ------------- -------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... 18,772,744 48,716,995 7,445,074 3,578,864
------------- ------------- ------------- -------------
Equity transactions:
Purchase payments received from
contract owners ............................... 9,105,639 13,554,935 2,901,332 9,835,014
Transfers between funds ......................... 2,219,442 87,855,437 18,884,051 3,627,127
Redemptions ..................................... (15,677,181) (9,101,590) (3,454,811) (3,343,829)
Annuity benefits ................................ (16,654) (5,268) (4,154) (1,508)
Annual contract maintenance charge (note 2) ..... (43,524) (37,563) (12,084) (10,428)
Contingent deferred sales charges (note 2) ...... (212,580) (108,237) (55,715) (58,620)
Adjustments to maintain reserves ................ 10,468 (32,509) 2,253 (25,891)
------------- ------------- ------------- -------------
Net equity transactions .................... (4,614,390) 92,125,205 18,260,873 10,021,865
------------- ------------- ------------- -------------
Net change in contract owners' equity ............. 14,158,354 140,842,200 25,705,947 13,600,729
Contract owners' equity beginning of period ....... 291,977,777 181,376,626 68,785,191 68,407,922
------------- ------------- ------------- -------------
Contract owners' equity end of period ............. $ 306,136,131 322,218,826 94,491,138 82,008,651
============= ============= ============= =============
</TABLE>
<TABLE>
<CAPTION>
AVISGro AVISHiYld
------------------------------ ------------------------------
1999 1998 1999 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ 32,521 47,312 123,208 131,272
Mortality, expense and administration
charges (note 2):
BOA ........................................ (214,319) (183,514) (16,389) (21,388)
BOAVision .................................. -- --
BOAEnterprise .............................. -- --
------------- ------------- ------------- -------------
Net investment activity ....................... (181,798) (136,202) 106,819 109,884
------------- ------------- ------------- -------------
Proceeds from mutual fund shares sold ........... 4,481,051 2,731,913 500,551 443,728
Cost of mutual fund shares sold ................. (2,317,262) (1,503,444) (521,057) (407,097)
------------- ------------- ------------- -------------
Realized gain (loss) on investments ........... 2,163,789 1,228,469 (20,506) 36,631
Change in unrealized gain (loss) on investments . 4,971,008 3,231,627 (4,814) (23,009)
------------- ------------- ------------- -------------
Net gain (loss) on investments ................ 7,134,797 4,460,096 (25,320) 13,622
------------- ------------- ------------- -------------
Reinvested capital gains ........................ -- -- -- --
------------- ------------- ------------- -------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... 6,952,999 4,323,894 81,499 123,506
------------- ------------- ------------- -------------
Equity transactions:
Purchase payments received from
contract owners ............................... 249,677 312,678 27,276 93,773
Transfers between funds ......................... 267,046 (258,711) (19,444) 192,111
Redemptions ..................................... (3,360,979) (1,446,633) (292,124) (351,209)
Annuity benefits ................................ (284) (221) (3,287) (1,980)
Annual contract maintenance charge (note 2) ..... (6,434) (6,741) (821) (1,093)
Contingent deferred sales charges (note 2) ...... (10,885) (6,231) (818) (2,939)
Adjustments to maintain reserves ................ 569 108 (82) (2,694)
------------- ------------- ------------- -------------
Net equity transactions .................... (2,861,290) (1,405,751) (289,301) (74,031)
------------- ------------- ------------- -------------
Net change in contract owners' equity ............. 4,091,709 2,918,143 (207,802) 49,475
Contract owners' equity beginning of period ....... 31,133,189 26,518,943 2,626,505 3,193,216
------------- ------------- ------------- -------------
Contract owners' equity end of period ............. 35,224,898 29,437,086 2,418,703 3,242,691
============= ============= ============= =============
</TABLE>
8
<PAGE> 8
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
AVISGvt DrySRGro
-------------------------------- --------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ 126,968 142,175 -- --
Mortality, expense and administration
charges (note 2):
BOA ........................................ (28,030) (31,272) (1,071,515) (693,083)
BOAVision .................................. -- -- (966,459) (694,517)
BOAEnterprise .............................. -- -- (1,871) (1,285)
-------------- -------------- -------------- --------------
Net investment activity ....................... 98,938 110,903 (2,039,845) (1,388,885)
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold ........... 504,249 1,389,899 57,634,136 68,861,675
Cost of mutual fund shares sold ................. (521,334) (1,488,451) (44,997,330) (54,091,401)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments ........... (17,085) (98,552) 12,636,806 14,770,274
Change in unrealized gain (loss) on investments . (161,279) 124,054 22,930,018 18,409,814
-------------- -------------- -------------- --------------
Net gain (loss) on investments ................ (178,364) 25,502 35,566,824 33,180,088
-------------- -------------- -------------- --------------
Reinvested capital gains ........................ -- -- -- --
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... (79,426) 136,405 33,526,979 31,791,203
-------------- -------------- -------------- --------------
Equity transactions:
Purchase payments received from
contract owners ............................... 82,878 92,358 18,444,034 19,863,181
Transfers between funds ......................... (56,511) (320,168) 35,564,212 18,615,537
Redemptions ..................................... (415,675) (665,756) (14,886,982) (7,302,510)
Annuity benefits ................................ (2,533) (1,383) (3,391) (2,573)
Annual contract maintenance charge (note 2) ..... (1,665) (2,256) (79,820) (56,132)
Contingent deferred sales charges (note 2) ...... (2,358) (3,034) (201,683) (111,403)
Adjustments to maintain reserves ................ (6) (1,934) 1,724 (202)
-------------- -------------- -------------- --------------
Net equity transactions .................... (395,870) (902,173) 38,838,094 31,005,898
Net change in contract owners' equity ............. (475,296) (765,768) 72,365,073 62,797,101
Contract owners' equity beginning of period ....... 4,480,028 5,090,894 265,379,214 181,485,180
-------------- -------------- -------------- --------------
Contract owners' equity end of period ............. $ 4,004,732 4,325,126 337,744,287 244,282,281
============== ============== ============== ==============
</TABLE>
<TABLE>
<CAPTION>
DryStkIx DryCapAp
-------------------------------- --------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ 10,564,367 9,004,652 10,752 4,487
Mortality, expense and administration
charges (note 2):
BOA ........................................ (5,525,756) (3,732,666) (643,195) (139,296)
BOAVision .................................. (7,153,018) (5,073,072) (668,534) (161,835)
BOAEnterprise .............................. (12,535) (7,717) (1,319) (292)
-------------- -------------- -------------- --------------
Net investment activity ....................... (2,126,942) 191,197 (1,302,296) (296,936)
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold ........... 246,701,792 195,014,855 37,600,675 15,408,575
Cost of mutual fund shares sold ................. (158,053,527) (126,455,346) (33,966,852) (13,437,419)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments ........... 88,648,265 68,559,509 3,633,823 1,971,156
Change in unrealized gain (loss) on investments . 104,558,685 125,320,954 9,721,852 5,325,947
-------------- -------------- -------------- --------------
Net gain (loss) on investments ................ 193,206,950 193,880,463 13,355,675 7,297,103
-------------- -------------- -------------- --------------
Reinvested capital gains ........................ 8,315,567 2,150,159 -- 14,955
Net increase (decrease) in contract owners'
equity resulting from operations ......... 199,395,575 196,221,819 12,053,379 7,015,122
-------------- -------------- -------------- --------------
Equity transactions:
Purchase payments received from
contract owners ............................... 88,810,790 127,515,406 12,303,541 6,061,478
Transfers between funds ......................... 111,626,321 74,477,347 33,873,192 80,089,278
Redemptions ..................................... (86,530,953) (45,748,814) (12,314,741) (1,724,843)
Annuity benefits ................................ (164,315) (112,324) (2,294) --
Annual contract maintenance charge (note 2) ..... (333,878) (220,761) (28,658) (6,726)
Contingent deferred sales charges (note 2) ...... (1,325,777) (677,050) (142,181) (21,483)
Adjustments to maintain reserves ................ 18,808 (19,286) 4,038 (1,819)
-------------- -------------- -------------- --------------
Net equity transactions .................... 112,100,996 155,214,518 33,692,899 84,395,885
Net change in contract owners' equity ............. 311,496,571 351,436,337 45,746,278 91,411,007
Contract owners' equity beginning of period ....... 1,722,772,232 1,096,238,216 167,200,842 10,047,888
-------------- -------------- -------------- --------------
Contract owners' equity end of period ............. 2,034,268,803 1,447,674,553 212,947,120 101,458,895
============== ============== ============== ==============
</TABLE>
(Continued)
9
<PAGE> 9
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
DryGrInc FidVIPEI
-------------------------------- --------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ 339,287 323,763 39,615,425 36,741,162
Mortality, expense and administration
charges (note 2):
BOA ........................................ (203,776) (167,049) (10,099,054) (10,712,723)
BOAVision .................................. (324,224) (291,655) (8,069,370) (8,027,553)
BOAEnterprise .............................. (1,570) (1,757) (7,591) (7,077)
-------------- -------------- -------------- --------------
Net investment activity ....................... (190,283) (136,698) 21,439,409 17,993,809
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold ........... 10,076,485 16,786,688 306,411,842 126,817,292
Cost of mutual fund shares sold ................. (9,693,078) (14,944,734) (187,834,294) (78,868,247)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments ........... 383,407 1,841,954 118,577,548 47,949,045
Change in unrealized gain (loss) on investments . 7,529,142 216,165 76,655,761 59,918,225
-------------- -------------- -------------- --------------
Net gain (loss) on investments ................ 7,912,549 2,058,119 195,233,309 107,867,270
-------------- -------------- -------------- --------------
Reinvested capital gains ........................ -- 1,182,628 87,570,939 130,755,312
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... 7,722,266 3,104,049 304,243,657 256,616,391
-------------- -------------- -------------- --------------
Equity transactions:
Purchase payments received from
contract owners ............................... 5,727,218 13,334,891 73,175,952 154,062,520
Transfers between funds ......................... (7,493,393) 3,090,870 (140,048,349) (27,958,257)
Redemptions ..................................... (3,966,232) (2,023,969) (143,976,169) (110,198,633)
Annuity benefits ................................ (283) -- (185,496) (134,521)
Annual contract maintenance charge (note 2) ..... (18,840) (11,942) (559,844) (586,563)
Contingent deferred sales charges (note 2) ...... (85,050) (37,007) (1,660,850) (1,411,722)
Adjustments to maintain reserves ................ 178 (1,965) (157,699) (29,860)
-------------- -------------- -------------- --------------
Net equity transactions .................... (5,836,402) 14,350,878 (213,412,456) 13,742,964
-------------- -------------- -------------- --------------
Net change in contract owners' equity ............. 1,885,864 17,454,927 90,831,201 270,359,355
Contract owners' equity beginning of period ....... 80,471,309 55,629,567 2,718,198,740 2,596,523,771
-------------- -------------- -------------- --------------
Contract owners' equity end of period ............. $ 82,357,173 73,084,494 2,809,029,941 2,866,883,126
============== ============== ============== ==============
</TABLE>
<TABLE>
<CAPTION>
FidVIPGr FidVIPHI
-------------------------------- --------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ 5,073,051 10,166,752 69,916,879 62,256,993
Mortality, expense and administration
charges (note 2):
BOA ........................................ (13,336,326) (9,599,825) (2,328,860) (2,925,158)
BOAVision .................................. (7,153,251) (4,732,502) (2,723,143) (3,089,060)
BOAEnterprise .............................. (11,717) (6,153) (2,179) (2,570)
-------------- -------------- -------------- --------------
Net investment activity ....................... (15,428,243) (4,171,728) 64,862,697 56,240,205
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold ........... 350,791,984 201,708,740 279,781,744 157,086,198
Cost of mutual fund shares sold ................. (232,684,424) (128,255,788) (314,489,226) (145,729,859)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments ........... 118,107,560 73,452,952 (34,707,482) 11,356,339
Change in unrealized gain (loss) on investments . (38,669,597) 26,018,613 21,019,693 (72,127,907)
-------------- -------------- -------------- --------------
Net gain (loss) on investments ................ 79,437,963 99,471,565 (13,687,789) (60,771,568)
-------------- -------------- -------------- --------------
Reinvested capital gains ........................ 318,968,052 265,940,840 2,613,715 39,559,131
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... 382,977,772 361,240,677 53,788,623 35,027,768
-------------- -------------- -------------- --------------
Equity transactions:
Purchase payments received from
contract owners ............................... 97,040,068 101,685,493 19,693,435 51,352,801
Transfers between funds ......................... 241,185,441 (9,862,648) (66,617,513) (12,682,764)
Redemptions ..................................... (188,033,525) (90,684,232) (46,242,231) (41,835,430)
Annuity benefits ................................ (272,830) (112,474) (35,062) (26,557)
Annual contract maintenance charge (note 2) ..... (731,590) (620,563) (116,092) (139,679)
Contingent deferred sales charges (note 2) ...... (1,880,001) (1,237,780) (594,658) (490,653)
Adjustments to maintain reserves ................ 103,289 8,268 27,148 (6,108)
-------------- -------------- -------------- --------------
Net equity transactions .................... 147,410,851 (823,936) (93,884,972) (3,828,390)
-------------- -------------- -------------- --------------
Net change in contract owners' equity ............. 530,388,623 360,416,741 (40,096,349) 31,199,378
Contract owners' equity beginning of period ....... 2,774,103,603 1,994,796,761 729,750,831 827,837,454
-------------- -------------- -------------- --------------
Contract owners' equity end of period ............. 3,304,492,226 2,355,213,502 689,654,482 859,036,832
============== ============== ============== ==============
</TABLE>
10
<PAGE> 10
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS'EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
FidVIPOv FidVIPAM
-------------------------------- --------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ 8,607,336 11,424,188 37,279,047 34,225,218
Mortality, expense and administration
charges (note 2):
BOA ........................................ (2,647,999) (3,046,856) (5,215,844) (5,370,672)
BOAVision .................................. (1,101,760) (1,167,358) (2,207,137) (2,102,846)
BOAEnterprise .............................. (304) (464) (1,715) (1,071)
-------------- -------------- -------------- --------------
Net investment activity ....................... 4,857,273 7,209,510 29,854,351 26,750,629
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold ........... 438,195,889 218,974,841 94,367,216 45,636,033
Cost of mutual fund shares sold ................. (430,655,378) (188,346,824) (77,934,816) (36,152,009)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments ........... 7,540,511 30,628,017 16,432,400 9,484,024
Change in unrealized gain (loss) on investments . 16,711,526 16,880,888 (43,739,964) (46,622,683)
-------------- -------------- -------------- --------------
Net gain (loss) on investments ................ 24,252,037 47,508,905 (27,307,564) (37,138,659)
-------------- -------------- -------------- --------------
Reinvested capital gains ........................ 13,882,800 33,671,290 47,220,126 102,675,653
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... 42,992,110 88,389,705 49,766,913 92,287,623
-------------- -------------- -------------- --------------
Equity transactions:
Purchase payments received from
contract owners ............................... 12,725,800 20,229,608 29,679,952 48,762,142
Transfers between funds ......................... (5,504,157) (12,780,304) (34,689,864) (18,517,640)
Redemptions ..................................... (33,835,069) (31,470,503) (74,926,291) (57,534,196)
Annuity benefits ................................ (72,706) (65,664) (114,798) (87,522)
Annual contract maintenance charge (note 2) ..... (144,148) (173,771) (300,063) (326,426)
Contingent deferred sales charges (note 2) ...... (343,719) (378,230) (699,172) (746,761)
Adjustments to maintain reserves ................ 3,191 (3,085) 3,985 (10,659)
-------------- -------------- -------------- --------------
Net equity transactions .................... (27,170,807) (24,641,949) (81,046,252) (28,461,062)
-------------- -------------- -------------- --------------
Net change in contract owners' equity ............. 15,821,303 63,747,756 (31,279,339) 63,826,561
Contract owners' equity beginning of period ....... 578,773,393 585,358,058 1,138,558,288 1,080,601,131
-------------- -------------- -------------- --------------
Contract owners' equity end of period ............. $ 594,594,696 649,105,814 1,107,278,949 1,144,427,692
============== ============== ============== ==============
FidVIPCon FidVIPGrOp
-------------------------------- --------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ 6,098,599 6,336,699 1,703,363 757,412
Mortality, expense and administration
charges (note 2):
BOA ........................................ (4,029,642) (2,911,050) (502,280) (259,476)
BOAVision .................................. (4,906,306) (3,702,966) (711,815) (335,457)
BOAEnterprise .............................. (3,878) (2,697) (812) (539)
-------------- -------------- -------------- --------------
Net investment activity ....................... (2,841,227) (280,014) 488,456 161,940
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold ........... 117,999,214 68,652,622 31,255,780 16,255,006
Cost of mutual fund shares sold ................. (69,404,448) (45,027,636) (26,948,490) (14,950,932)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments ........... 48,594,766 23,624,986 4,307,290 1,304,074
Change in unrealized gain (loss) on investments . 40,498,343 74,666,240 2,876,763 4,095,258
-------------- -------------- -------------- --------------
Net gain (loss) on investments ................ 89,093,109 98,291,226 7,184,053 5,399,332
-------------- -------------- -------------- --------------
Reinvested capital gains ........................ 44,723,057 46,619,997 3,184,549 2,632,909
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... 130,974,939 144,631,209 10,857,058 8,194,181
-------------- -------------- -------------- --------------
Equity transactions:
Purchase payments received from
contract owners ............................... 53,986,917 68,494,623 13,967,012 20,544,272
Transfers between funds ......................... 60,140,404 (20,797,205) 22,663,816 41,995,241
Redemptions ..................................... (56,384,796) (30,880,679) (7,891,022) (2,661,376)
Annuity benefits ................................ (51,867) (9,174) (40) --
Annual contract maintenance charge (note 2) ..... (242,795) (189,743) (27,699) (11,359)
Contingent deferred sales charges (note 2) ...... (843,083) (500,214) (108,764) (23,728)
Adjustments to maintain reserves ................ 20,872 (7,576) 622 (1,289)
-------------- -------------- -------------- --------------
Net equity transactions .................... 56,625,652 16,110,032 28,603,925 59,841,761
-------------- -------------- -------------- --------------
Net change in contract owners' equity ............. 187,600,591 160,741,241 39,460,983 68,035,942
Contract owners' equity beginning of period ....... 1,224,548,927 898,176,376 158,829,125 47,657,224
-------------- -------------- -------------- --------------
Contract owners' equity end of period ............. 1,412,149,518 1,058,917,617 198,290,108 115,693,166
============== ============== ============== ==============
</TABLE>
(Continued)
11
<PAGE> 11
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS'EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
MSEmMkt NSATCapAp
-------------------------------- --------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................... $ -- -- 1,862,260 2,147,228
Mortality, expense and administration
charges (note 2):
BOA ........................................... (32,325) (30,698) (2,390,158) (1,665,100)
BOAVision ..................................... (31,455) (34,834) (2,058,027) (1,444,644)
BOAEnterprise ................................. (6) (91) (17,451) (8,421)
-------------- -------------- -------------- --------------
Net investment activity .......................... (63,786) (65,623) (2,603,375) (970,937)
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold .............. 26,228,043 12,131,618 117,848,687 48,204,741
Cost of mutual fund shares sold .................... (26,038,987) (11,951,972) (78,307,505) (30,117,070)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments .............. 189,056 179,646 39,541,182 18,087,671
Change in unrealized gain (loss) on investments .... 762,187 (647,489) 33,550,274 58,809,868
-------------- -------------- -------------- --------------
Net gain (loss) on investments ................... 951,243 (467,843) 73,091,456 76,897,539
-------------- -------------- -------------- --------------
Reinvested capital gains ........................... -- -- -- --
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations ............ 887,457 (533,466) 70,488,081 75,926,602
-------------- -------------- -------------- --------------
Equity transactions:
Purchase payments received from
contract owners .................................. 429,421 970,358 32,237,189 43,519,033
Transfers between funds ............................ (1,344,897) 2,259,468 (63,379,305) 63,443,682
Redemptions ........................................ (520,403) (433,935) (33,537,659) (17,238,317)
Annuity benefits ................................... -- -- (14,635) (3,744)
Annual contract maintenance charge (note 2) ........ (1,703) (1,071) (144,421) (87,745)
Contingent deferred sales charges (note 2) ......... (8,325) (6,773) (469,398) (217,785)
Adjustments to maintain reserves ................... 54 3,730 7,011 19,839
-------------- -------------- -------------- --------------
Net equity transactions ....................... (1,445,853) 2,791,777 (65,301,218) 89,434,963
-------------- -------------- -------------- --------------
Net change in contract owners' equity ................ (558,396) 2,258,311 5,186,863 165,361,565
Contract owners' equity beginning of period .......... 8,731,806 8,146,810 698,327,731 363,605,489
-------------- -------------- -------------- --------------
Contract owners' equity end of period ................ $ 8,173,410 10,405,121 703,514,594 528,967,054
============== ============== ============== ==============
NSATGvtBd NSATMyMkt
-------------------------------- --------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................... 11,189,173 8,975,341 25,103,584 22,143,936
Mortality, expense and administration
charges (note 2):
BOA ........................................... (1,648,068) (1,378,254) (3,910,962) (3,214,953)
BOAVision ..................................... (1,200,500) (684,227) (3,349,749) (2,504,258)
BOAEnterprise ................................. (4,050) (1,343) (7,238) (3,465)
-------------- -------------- -------------- --------------
Net investment activity .......................... 8,336,555 6,911,517 17,835,635 16,421,260
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold .............. 69,669,932 60,679,769 1,809,935,555 1,484,819,800
Cost of mutual fund shares sold .................... (67,953,586) (56,392,188) (1,809,935,556) (1,484,819,800)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments .............. 1,716,346 4,287,581 (1) --
Change in unrealized gain (loss) on investments .... (22,283,958) (1,274,119) -- --
-------------- -------------- -------------- --------------
Net gain (loss) on investments ................... (20,567,612) 3,013,462 (1) --
-------------- -------------- -------------- --------------
Reinvested capital gains ........................... -- -- -- --
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations ............ (12,231,057) 9,924,979 17,835,634 16,421,260
-------------- -------------- -------------- --------------
Equity transactions:
Purchase payments received from
contract owners .................................. 25,796,170 16,842,041 85,172,299 152,025,923
Transfers between funds ............................ (28,741,507) 10,026,757 181,689,852 (63,365,080)
Redemptions ........................................ (29,852,228) (18,803,296) (203,591,460) (88,757,206)
Annuity benefits ................................... (42,130) (12,497) (12,916) (17,716)
Annual contract maintenance charge (note 2) ........ (85,486) (80,302) (192,420) (160,142)
Contingent deferred sales charges (note 2) ......... (274,135) (210,798) (2,896,906) (1,118,076)
Adjustments to maintain reserves ................... (7,727) (11,858) (524,262) (20,794)
-------------- -------------- -------------- --------------
Net equity transactions ....................... (33,207,043) 7,750,047 59,644,188 (1,413,091)
-------------- -------------- -------------- --------------
Net change in contract owners' equity ................ (45,438,100) 17,675,026 77,479,822 15,008,169
Contract owners' equity beginning of period .......... 441,874,130 299,681,912 971,315,955 839,446,496
-------------- -------------- -------------- --------------
Contract owners' equity end of period ................ 396,436,030 317,356,938 1,048,795,777 854,454,665
============== ============== ============== ==============
</TABLE>
12
<PAGE> 12
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
NSATSmCapV NSATSmCo
-------------------------------- --------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ -- -- -- --
Mortality, expense and administration
charges (note 2):
BOA ........................................ (74,401) (3,412) (728,783) (921,830)
BOAVision .................................. (61,887) (2,478) (905,710) (1,099,383)
BOAEnterprise .............................. (227) (18) (3,388) (4,881)
-------------- -------------- -------------- --------------
Net investment activity ....................... (136,516) (5,908) (1,637,881) (2,026,094)
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold ........... 54,359,039 6,223,530 140,035,545 132,047,603
Cost of mutual fund shares sold ................. (50,983,250) (6,296,508) (147,128,945) (109,947,843)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments ........... 3,375,789 (72,978) (7,093,400) 22,099,760
Change in unrealized gain (loss) on investments . 2,704,788 (37,526) 22,245,869 (4,600,996)
-------------- -------------- -------------- --------------
Net gain (loss) on investments ................ 6,080,577 (110,504) 15,152,469 17,498,764
-------------- -------------- -------------- --------------
Reinvested capital gains ........................ 573,405 -- -- --
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... 6,517,466 (116,412) 13,514,588 15,472,670
-------------- -------------- -------------- --------------
Equity transactions:
Purchase payments received from
contract owners ............................... 785,438 167,770 9,574,468 23,526,278
Transfers between funds ......................... 28,006,868 5,478,839 (46,291,578) (15,739,063)
Redemptions ..................................... (1,112,890) (101,373) (12,400,824) (10,134,672)
Annuity benefits ................................ -- -- (13,433) (7,540)
Annual contract maintenance charge (note 2) ..... (2,507) (109) (53,127) (57,792)
Contingent deferred sales charges (note 2) ...... (16,786) (2,064) (185,520) (137,970)
Adjustments to maintain reserves ................ 315 (17) (5,219) (2,129)
-------------- -------------- -------------- --------------
Net equity transactions .................... 27,660,437 5,543,046 (49,375,233) (2,552,888)
-------------- -------------- -------------- --------------
Net change in contract owners' equity ............. 34,177,903 5,426,634 (35,860,645) 12,919,782
Contract owners' equity beginning of period ....... 13,630,519 -- 281,418,074 290,550,224
-------------- -------------- -------------- --------------
Contract owners' equity end of period ............. $ 47,808,422 5,426,634 245,557,429 303,470,006
============== ============== ============== ==============
NSATTotRe NBAMTGro
-------------------------------- --------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ 4,852,023 6,368,682 -- --
Mortality, expense and administration
charges (note 2):
BOA ........................................ (4,696,052) (4,473,032) (2,080,416) (2,369,715)
BOAVision .................................. (3,619,090) (3,237,715) (713,865) (834,939)
BOAEnterprise .............................. (28,088) (20,901) (1,321) (1,307)
-------------- -------------- -------------- --------------
Net investment activity ....................... (3,491,207) (1,362,966) (2,795,601) (3,205,961)
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold ........... 119,901,944 27,953,959 160,735,413 120,406,852
Cost of mutual fund shares sold ................. (64,023,117) (14,216,509) (179,838,075) (113,939,537)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments ........... 55,878,827 13,737,450 (19,102,662) 6,467,315
Change in unrealized gain (loss) on investments . 66,876,780 135,574,768 4,904,592 (60,188,248)
-------------- -------------- -------------- --------------
Net gain (loss) on investments ................ 122,755,607 149,312,218 (14,198,070) (53,720,933)
-------------- -------------- -------------- --------------
Reinvested capital gains ........................ 565,910 -- 23,683,476 124,274,598
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... 119,830,310 147,949,252 6,689,805 67,347,704
-------------- -------------- -------------- --------------
Equity transactions:
Purchase payments received from
contract owners ............................... 47,187,871 89,681,344 9,718,976 16,777,782
Transfers between funds ......................... (44,877,569) 10,886,852 (60,488,788) (14,431,585)
Redemptions ..................................... (59,307,507) (50,510,589) (28,060,950) (24,294,610)
Annuity benefits ................................ (127,900) (96,407) (48,771) (40,385)
Annual contract maintenance charge (note 2) ..... (315,656) (263,644) (124,733) (145,581)
Contingent deferred sales charges (note 2) ...... (782,293) (583,024) (255,901) (258,060)
Adjustments to maintain reserves ................ 15,176 24,570 49 (8,760)
-------------- -------------- -------------- --------------
Net equity transactions .................... (58,207,878) 49,139,102 (79,260,117) (22,401,199)
-------------- -------------- -------------- --------------
Net change in contract owners' equity ............. 61,622,432 197,088,354 (72,570,312) 44,946,505
Contract owners' equity beginning of period ....... 1,231,708,938 1,035,147,551 484,441,048 477,494,040
-------------- -------------- -------------- --------------
Contract owners' equity end of period ............. 1,293,331,370 1,232,235,905 411,870,736 522,440,545
============== ============== ============== ==============
</TABLE>
(Continued)
13
<PAGE> 13
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS 'EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
NBAMTGuard NBAMTLMat
------------------------------- ------------------------------
1999 1998 1999 1998
------------ ---------- ----------- -----------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends............................... $ 165,509 -- 9,460,320 11,658,274
Mortality, expense and administration
charges (note 2):
BOA........................................ (150,721) (13,610) (653,426) (725,803)
BOAVision.................................. (203,775) (42,513) (457,330) (514,138)
BOAEnterprise.............................. (538) (21) (432) (451)
------------ ---------- ----------- -----------
Net investment activity........................ (189,526) (56,144) 8,349,132 10,417,882
------------ ---------- ----------- -----------
Proceeds from mutual fund shares sold.............. 8,953,790 1,124,661 26,481,089 27,530,038
Cost of mutual fund shares sold.................... (8,935,283) (1,166,532) (27,747,217) (28,037,204)
------------ ---------- ----------- -----------
Realized gain (loss) on investments............ 18,507 (41,871) (1,266,128) (507,166)
Change in unrealized gain (loss) on investments.... 8,160,327 (357,883) (7,625,457) (6,577,711)
------------ ---------- ----------- -----------
Net gain (loss) on investments................. 8,178,834 (399,754) (8,891,585) (7,084,877)
------------ ---------- ----------- -----------
Reinvested capital gains........................... -- -- -- --
Net increase (decrease) in contract owners'
equity resulting from operations...... 7,989,308 (455,898) (542,453) 3,333,005
------------ ---------- ----------- -----------
Equity transactions:
Purchase payments received from
contract owners................................ 3,433,741 383,686 5,425,255 13,293,975
Transfers between funds............................ 22,060,365 29,531,145 (15,768,567) (11,199,400)
Redemptions........................................ (4,502,438) (262,732) (11,751,298) (12,244,793)
Annuity benefits................................... -- -- (35,307) (7,751)
Annual contract maintenance charge (note 2)........ (7,669) (624) (29,664) (33,202)
Contingent deferred sales charges (note 2)......... (58,520) (3,068) (106,558) (111,457)
Adjustments to maintain reserves................... 671 (100) (5,657) 45
------------ ---------- ----------- -----------
Net equity transactions.................... 20,926,150 29,648,307 (22,271,797) (10,302,583)
------------ ---------- ----------- -----------
Net change in contract owners' equity.................. 28,915,458 29,192,409 (22,814,250) (6,969,578)
Contract owners' equity beginning of period............ 37,860,012 -- 178,684,975 188,450,178
------------ ---------- ----------- -----------
Contract owners' equity end of period.................. $ 66,775,470 29,192,409 155,870,725 181,480,600
============ ========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
NBAMTPart OppBdFd
------------------------------- ------------------------------
1999 1998 1999 1998
------------ ---------- ----------- -----------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends............................... 7,337,748 3,116,604 15,414,869 4,888,363
Mortality, expense and administration
charges (note 2):
BOA........................................ (1,772,050) (2,498,541) (1,005,445) (924,022)
BOAVision.................................. (2,435,162) (3,225,984) (1,222,849) (1,090,273)
BOAEnterprise.............................. (3,901) (5,469) (2,036) (951)
------------ ----------- ----------- -----------
Net investment activity........................ 3,126,635 (2,613,390) 13,184,540 2,873,117
------------ ----------- ----------- -----------
Proceeds from mutual fund shares sold.............. 163,207,305 124,191,440 37,034,630 37,901,793
Cost of mutual fund shares sold.................... (143,715,540) (98,023,788) (36,607,143) (35,006,289)
------------ ----------- ----------- -----------
Realized gain (loss) on investments............ 19,491,765 26,167,652 427,487 2,895,504
Change in unrealized gain (loss) on investments.... 36,172,211 (79,282,377) (22,803,852) (654,044)
------------ ----------- ----------- -----------
Net gain (loss) on investments................. 55,663,976 (53,114,725) (22,376,365) 2,241,460
------------ ----------- ----------- -----------
Reinvested capital gains........................... 12,761,301 98,173,016 1,480,371 4,423,968
------------ ----------- ----------- -----------
Net increase (decrease) in contract owners'
equity resulting from operations 71,551,912 42,444,901 (7,711,454) 9,538,545
------------ ----------- ----------- -----------
Equity transactions:
Purchase payments received from
contract owners ............................... 20,294,009 71,012,596 13,590,018 22,076,862
Transfers between funds ........................... (111,373,575) (20,152,842) (9,180,722) (2,641,675)
Redemptions ....................................... (27,063,676) (28,346,780) (18,633,460) (12,199,727)
Annuity benefits .................................. (13,475) (6,044) (46,798) (41,597)
Annual contract maintenance charge (note 2)........ (122,587) (130,960) (51,953) (50,020)
Contingent deferred sales charges (note 2)......... (403,470) (391,118) (242,562) (173,434)
Adjustments to maintain reserves................... (839) 256 (867) (1,247)
------------ ----------- ----------- -----------
Net equity transactions.................... (118,683,612) 21,985,108 (14,566,343) 6,969,162
------------ ----------- ----------- -----------
Net change in contract owners' equity (47,131,700) 64,430,009 (22,277,797) 16,507,707
Contract owners' equity beginning of period............ 665,008,012 777,189,563 338,486,831 290,966,291
------------ ----------- ----------- -----------
Contract owners' equity end of period.................. 617,876,312 841,619,572 316,209,034 307,473,998
============ =========== =========== ===========
</TABLE>
(Continued)
14
<PAGE> 14
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS 'EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
OppGISec OppGro
--------------------------------- ---------------------------
1999 1998 1999 1998
------------- ---------- --------- ---------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends................................ $ 6,228,265 10,856,886 374,223 188,351
Mortality, expense and administration
charges (note 2):
BOA........................................ (1,780,015) (1,804,398) (397,379) (102,797)
BOAVision.................................. (1,876,325) (1,836,779) (325,811) (91,138)
BOAEnterprise.............................. (856) (962) (833) (284)
------------- ----------- ----------- ----------
Net investment activity......................... 2,571,068 7,214,747 (349,800) (5,868)
------------- ----------- ----------- ----------
Proceeds from mutual fund shares sold............... 90,318,858 59,938,116 12,835,213 6,921,199
Cost of mutual fund shares sold..................... (62,592,628) (40,682,858) (11,436,143) (6,683,106)
------------- ----------- ----------- ----------
Realized gain (loss) on investments............. 27,726,230 19,255,258 1,399,070 238,093
Change in unrealized gain (loss) on investments..... 19,056,359 (10,214,150) 9,949,243 1,708,886
------------- ----------- ----------- ----------
Net gain (loss) on investments.................. 46,782,589 9,041,108 11,348,313 1,946,979
------------- ----------- ----------- ----------
Reinvested capital gains............................ 17,453,216 40,867,407 4,110,735 2,272,563
------------- ----------- ----------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations....... 66,806,873 57,123,262 15,109,248 4,213,674
------------- ----------- ----------- ----------
Equity transactions:
Purchase payments received from
contract owners................................. 15,396,326 31,758,518 8,807,987 8,643,848
Transfers between funds............................. (21,136,977) 4,686,767 67,029,236 12,910,039
Redemptions......................................... (25,301,098) (18,731,010) (7,892,931) (776,512)
Annuity benefits.................................... (22,916) (8,763) (4,506) (788)
Annual contract maintenance charge (note 2)......... (103,880) (107,412) (24,809) (4,247)
Contingent deferred sales charges (note 2).......... (352,947) (267,859) (83,804) (8,494)
Adjustments to maintain reserves.................... 37,051 2,106 (1,608) (1,719)
------------- ----------- ----------- ----------
Net equity transactions.................... (31,484,441) 17,332,347 67,829,565 20,762,127
------------- ----------- ----------- ----------
Net change in contract owners' equity................... 35,322,432 74,455,609 82,938,813 24,975,801
Contract owners' equity beginning of period............. 542,142,739 489,322,679 63,555,624 16,190,114
------------- ----------- ----------- ----------
Contract owners' equity end of period................... $ 577,465,171 563,778,288 146,494,437 41,165,915
============= =========== =========== ==========
</TABLE>
<TABLE>
<CAPTION>
OppMult StOpp2
------------------------------- -----------------------------
1999 1998 1999 1998
------------- ----------- ----------- ----------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends................................ 10,981,914 3,212,145 -- 275,073
Mortality, expense and administration...............
charges (note 2):...............................
BOA........................................ (1,120,044) (1,270,217) (3,406,897) (3,503,823)
BOAVision.................................. (1,038,263) (1,125,718) (1,930,702) (2,014,302)
BOAEnterprise.............................. (1,526) (1,258) (2,697) (2,704)
------------- ----------- ----------- ------------
Net investment activity......................... 8,822,081 814,952 (5,340,296) (5,245,756)
------------- ----------- ----------- ------------
Proceeds from mutual fund shares sold............... 42,151,571 10,856,307 135,864,498 83,757,828
Cost of mutual fund shares sold..................... (34,463,695) (7,837,962) (105,908,928) (53,875,976)
------------- ----------- ----------- ------------
Realized gain (loss) on investments............. 7,687,876 3,018,345 29,955,570 29,881,852
Change in unrealized gain (loss) on investments..... (8,574,969) (673,378) 28,042,158 (29,228,918)
------------- ----------- ----------- ------------
Net gain (loss) on investments.................. (887,093) 2,344,967 57,997,728 652,934
------------- ----------- ----------- ------------
Reinvested capital gains............................ 15,885,380 18,630,439 85,940,550 101,358,207
------------- ----------- ----------- ------------
Net increase (decrease) in contract owners'
equity resulting from operations....... 23,820,368 21,790,358 138,597,982 96,765,385
------------- ----------- ----------- ------------
Equity transactions:
Purchase payments received from
contract owners................................. 8,608,673 23,403,887 19,130,921 35,730,746
Transfers between funds............................. (29,388,163) (6,362,589) (53,470,047) (10,308,522)
Redemptions......................................... (17,905,934) (16,522,311) (42,924,449) (28,921,115)
Annuity benefits.................................... (27,135) (15,347) (31,553) (24,176)
Annual contract maintenance charge (note 2)......... (69,697) (76,041) (182,804) (197,185)
Contingent deferred sales charges (note 2).......... (202,428) (202,593) (493,291) (397,012)
Adjustments to maintain reserves.................... 2,718 (9,862) 53,445 8,185
------------- ----------- ----------- ------------
Net equity transactions.................... (38,981,966) 215,144 (77,917,777) (4,109,079)
------------- ----------- ----------- ------------
Net change in contract owners' equity................... (15,161,598) 22,005,502 60,680,205 92,656,306
Contract owners' equity beginning of period............. 332,525,906 340,972,204 786,368,057 764,227,770
------------- ----------- ----------- ------------
Contract owners' equity end of period................... 317,364,308 362,977,706 847,048,262 856,884,076
============= =========== =========== ============
</TABLE>
(Continued)
16
<PAGE> 15
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
StDisc2 StIntStk2
--------------------------- -------------------------------
1999 1998 1999 1998
------------- ------------ ----------- ------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends................................ $ -- -- 138,546 530,498
Mortality, expense and administration
charges (note 2):
BOA......................................... (611,285) (781,617) (103,970) (146,258)
BOAVision................................... (388,469) (508,056) (138,460) (191,882)
BOAEnterprise............................... (182) (294) (151) (185)
------------ ------------ ----------- ------------
Net investment activity......................... (999,936) (1,289,967) (104,035) 192,173
------------ ------------ ----------- ------------
Proceeds from mutual fund shares sold............... 50,743,895 46,665,592 47,745,347 20,333,342
Cost of mutual fund shares sold..................... (48,639,945) (40,771,871) (48,520,139) (22,524,186)
------------ ------------ ----------- ------------
Realized gain (loss) on investments............. 2,103,950 5,893,721 (774,792) (2,190,844)
Change in unrealized gain (loss) on investments..... (32,691,129) 5,783,102 4,759,409 5,184,345
------------ ------------ ----------- ------------
Net gain (loss) on investments.................. (30,587,179) 11,676,823 3,984,617 2,993,501
------------ ------------ ----------- ------------
Reinvested capital gains............................ 20,481,549 2,856,579 -- --
------------ ------------ ----------- ------------
Net increase (decrease) in contract owners'
equity resulting from operations....... (11,105,566) 13,243,435 3,880,582 3,185,674
------------ ------------ ----------- ------------
Equity transactions:
Purchase payments received from
contract owners................................. 4,475,650 8,162,317 1,256,708 2,716,958
Transfers between funds............................. (23,567,558) (18,778,298) (1,603,998) (6,535,651)
Redemptions......................................... (8,400,824) (7,500,752) (2,076,278) (2,007,256)
Annuity benefits.................................... (5,976) (4,989) (2,151) (2,347)
Annual contract maintenance charge (note 2)......... (41,321) (53,133) (7,526) (9,688)
Contingent deferred sales charges (note 2).......... (124,100) (118,796) (32,809) (33,050)
Adjustments to maintain reserves.................... 146 (7,281) 452 (4,864)
------------ ------------ ----------- ------------
Net equity transactions..................... (27,663,982) (18,300,932) (2,465,603) (5,875,898)
------------ ------------ ----------- ------------
Net change in contract owners' equity................... (38,769,548) (5,057,497) 1,414,979 (2,690,224)
Contract owners' equity beginning of period............. 174,894,389 195,266,423 37,277,231 49,718,321
------------ ------------ ----------- ------------
Contract owners' equity end of period................... $136,124,841 190,208,926 38,692,210 47,028,097
============ ============ =========== ============
</TABLE>
<TABLE>
<CAPTION>
VEWrldBd VEWrldEMkt
1999 1998 1999 1998
------------ ------------ ----------- ------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends................................ 3,808,176 874,183 -- 606,759
Mortality, expense and administration
charges (note 2):
BOA......................................... (340,763) (380,834) (197,909) (215,894)
BOAVision................................... (250,624) (259,631) (173,485) (232,693)
BOAEnterprise............................... (116) (101) (562) (467)
------------ ------------ ----------- ------------
Net investment activity......................... 3,216,673 233,617 (371,956) 157,705
------------ ------------ ----------- ------------
Proceeds from mutual fund shares sold 39,631,979 17,480,822 74,941,359 48,944,375
Cost of mutual fund shares sold..................... (38,412,771) (17,397,970) (60,225,112) (68,879,745)
------------ ------------ ----------- ------------
Realized gain (loss) on investments............. 1,219,208 82,852 14,716,247 (19,935,370)
Change in unrealized gain (loss) on investments..... (13,351,943) 2,215,510 8,049,873 4,262,247
------------ ------------ ----------- ------------
Net gain (loss) on investments.................. (12,132,735) 2,298,362 22,766,120 (15,673,123)
------------ ------------ ----------- ------------
Reinvested capital gains............................ 1,701,526 -- -- 539,341
------------ ------------ ----------- ------------
Net increase (decrease) in contract owners'
equity resulting from operations....... (7,214,536) 2,531,979 22,394,164 (14,976,077)
------------ ------------ ----------- ------------
Equity transactions:
Purchase payments received from.....................
contract owners................................. 2,275,770 3,372,107 2,113,307 5,659,239
Transfers between funds............................. (8,903,821) (1,481,831) 52,252,887 (18,747,855)
Redemptions......................................... (6,883,134) (6,292,171) (4,739,094) (3,174,552)
Annuity benefits.................................... (11,642) (5,739) (734) (1,882)
Annual contract maintenance charge (note 2)......... (18,526) (20,805) (11,977) (14,703)
Contingent deferred sales charges (note 2).......... (79,050) (55,858) (46,085) (45,362)
Adjustments to maintain reserves.................... (1,875) (2,989) 45,902 12,786
------------ ------------ ----------- ------------
Net equity transactions..................... (13,622,277) (4,487,286) 49,614,206 (16,312,329)
------------ ------------ ----------- ------------
Net change in contract owners' equity................... (20,836,813) (1,955,307) 72,008,370 (31,288,406)
Contract owners' equity beginning of period............. 99,446,008 97,264,864 35,036,893 77,776,313
------------ ------------ ----------- ------------
Contract owners' equity end of period................... 78,609,195 95,309,557 107,045,263 46,487,907
============ ============ =========== ============
</TABLE>
16
<PAGE> 16
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
VEWrldHAs MSRESec
------------------------------- ------------------------------
1999 1998 1999 1998
------------ ------------ ----------- ------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends................................ $ 987,982 711,661 8,729,269 393,097
Mortality, expense and administration
charges (note 2):
BOA......................................... (299,495) (482,321) (429,478) (769,496)
BOAVision................................... (169,755) (261,589) (509,583) (863,330)
BOAEnterprise............................... (384) (496) (957) (1,359)
------------ ------------ ----------- ------------
Net investment activity......................... 518,348 (32,745) 7,789,251 (1,241,088)
------------ ------------ ----------- ------------
Proceeds from mutual fund shares sold............... 76,026,743 57,468,176 55,028,999 55,400,128
Cost of mutual fund shares sold..................... (81,003,083) (69,323,681) (62,729,612) (49,387,335)
------------ ------------ ----------- ------------
Realized gain (loss) on investments............. (4,976,340) (11,855,505) (7,700,613) 6,012,793
Change in unrealized gain (loss) on investments..... 15,354,058 (21,882,300) 9,189,183 (22,459,894)
------------ ------------ ----------- ------------
Net gain (loss) on investments.................. 10,377,718 (33,737,805) 1,488,570 (16,447,101)
------------ ------------ ----------- ------------
Reinvested capital gains............................ -- 17,475,241 -- 3,868,070
Net increase (decrease) in contract owners'
equity resulting from operations....... 10,896,066 (16,295,309) 9,277,821 (13,820,119)
------------ ------------ ----------- ------------
Equity transactions:
Purchase payments received from
contract owners................................. 1,707,742 3,859,730 3,640,188 15,377,243
Transfers between funds............................. 4,882,677 (16,545,723) (29,139,471) (46,026,010)
Redemptions......................................... (5,572,635) (4,750,419) (8,534,716) (8,772,346)
Annuity benefits.................................... (1,521) (2,187) (2,929) (2,897)
Annual contract maintenance charge (note 2)......... (20,979) (31,268) (26,618) (39,873)
Contingent deferred sales charges (note 2).......... (71,579) (59,311) (123,252) (102,222)
Adjustments to maintain reserves.................... 3,754 (71,638) (3,024) (4,508)
------------ ------------ ----------- ------------
Net equity transactions..................... 927,459 (17,600,816) (34,189,821) (39,570,613)
------------ ------------ ----------- ------------
Net change in contract owners' equity................... 11,823,525 (33,896,125) (24,912,000) (53,390,732)
Contract owners' equity beginning of period............. 63,818,047 127,190,392 159,566,073 268,677,705
------------ ------------ ----------- ------------
Contract owners' equity end of period................... $ 75,641,572 93,294,267 134,654,073 215,286,973
============ ============ =========== ============
</TABLE>
<TABLE>
<CAPTION>
WPIntEq WPPVenCap
------------------------------- ------------------------------
1999 1998 1999 1998
------------ ------------ ----------- ------------
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends................................ -- -- -- --
Mortality, expense and administration
charges (note 2):
BOA......................................... (589,525) (840,510) (70,868) (64,309)
BOAVision................................... (815,651) (1,151,747) (79,826) (60,040)
BOAEnterprise............................... (299) (729) (157) (216)
------------ ------------ ----------- ------------
Net investment activity......................... (1,405,475) (1,992,986) (150,851) (124,565)
------------ ------------ ----------- ------------
Proceeds from mutual fund shares sold............... 79,903,842 109,278,040 20,740,495 31,925,665
Cost of mutual fund shares sold..................... (87,305,761) (107,139,977) (20,107,157) (30,207,975)
------------ ------------ ----------- ------------
Realized gain (loss) on investments............. (7,401,919) 2,138,063 633,338 1,717,690
Change in unrealized gain (loss) on investments..... 20,941,836 34,758,926 1,630,224 575,939
------------ ------------ ----------- ------------
Net gain (loss) on investments.................. 13,539,917 36,896,989 2,263,562 2,293,629
------------ ------------ ----------- ------------
Reinvested capital gains............................ -- -- -- --
Net increase (decrease) in contract owners'
equity resulting from operations....... 12,134,442 34,904,003 2,112,711 2,169,064
------------ ------------ ----------- ------------
Equity transactions:
Purchase payments received from
contract owners................................. 6,176,378 15,406,815 624,500 1,675,659
Transfers between funds............................. (29,827,089) (42,413,480) 2,875,876 3,736,868
Redemptions......................................... (9,959,687) (9,741,464) (980,425) (1,115,131)
Annuity benefits.................................... (10,876) (5,711) -- --
Annual contract maintenance charge (note 2)......... (36,678) (48,425) (3,769) (3,726)
Contingent deferred sales charges (note 2).......... (159,499) (132,161) (12,254) (11,515)
Adjustments to maintain reserves.................... 255 2,818 53 (130)
------------ ------------ ----------- ------------
Net equity transactions..................... (33,817,196) (36,931,608) 2,503,981 4,282,025
------------ ------------ ----------- ------------
Net change in contract owners' equity (21,682,754) (2,027,605) 4,616,692 6,451,089
Contract owners' equity beginning of period............. 227,695,750 286,776,025 22,185,686 14,678,793
------------ ------------ ----------- ------------
Contract owners' equity end of period................... 206,012,996 284,748,420 26,802,378 21,129,882
============ ============ =========== ============
</TABLE>
(Continued)
17
<PAGE> 17
NATIONWIDE VARIABLE ACCOUNT-II
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
WPSmCoGr
--------------------------------
1999 1998
------------ ------------
<S> <C> <C>
Investment activity:
Reinvested dividends................................ $ -- --
Mortality, expense and administration
charges (note 2):
BOA......................................... (903,059) (1,194,562)
BOAVision................................... (972,471) (1,368,706)
BOAEnterprise............................... (1,906) (2,248)
------------ ------------
Net investment activity......................... (1,877,436) (2,565,516)
------------ ------------
Proceeds from mutual fund shares sold............... 96,181,619 141,376,448
Cost of mutual fund shares sold..................... (103,399,006) (115,793,369)
------------ ------------
Realized gain (loss) on investments............. (7,217,387) 25,583,079
Change in unrealized gain (loss) on investments..... 22,994,385 (7,716,827)
------------ ------------
Net gain (loss) on investments.................. 15,776,998 17,866,252
------------ ------------
Reinvested capital gains............................ -- --
------------ ------------
Net increase (decrease) in contract owners'
equity resulting from operations....... 13,899,562 15,300,736
------------ ------------
Equity transactions:
Purchase payments received from
contract owners................................. 9,383,903 22,114,528
Transfers between funds............................. (52,247,794) (40,111,858)
Redemptions......................................... (13,826,135) (12,709,338)
Annuity benefits.................................... (4,927) (3,802)
Annual contract maintenance charge (note 2)......... (59,488) (73,647)
Contingent deferred sales charges (note 2).......... (222,196) (217,616)
Adjustments to maintain reserves.................... 222 (1,506)
------------ ------------
Net equity transactions..................... (56,976,417) (31,003,239)
------------ ------------
Net change in contract owners' equity................... (43,076,855) (15,702,503)
Contract owners' equity beginning of period............. 320,942,393 383,397,113
------------ ------------
Contract owners' equity end of period................... $277,865,538 367,694,610
============ ============
</TABLE>
18
See accompanying notes to financial statements.
<PAGE> 18
- --------------------------------------------------------------------------------
NATIONWIDE VARIABLE ACCOUNT-II
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1999 AND 1998
(UNAUDITED)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Organization and Nature of Operations
The Nationwide Variable Account-II (the Account) was established
pursuant to a resolution of the Board of Directors of Nationwide Life
Insurance Company (the Company) on October 7, 1981. The Account has
been registered as a unit investment trust under the Investment Company
Act of 1940.
The Company offers tax qualified and non-tax qualified Individual
Deferred Variable Annuity Contracts, and Individual Modified Single
Premium Deferred Variable Annuity Contracts through the Account. The
primary distribution for the contracts is through the brokerage
community; however, other distributors are utilized.
(b) The Contracts
Only contracts without a front-end sales charge, but with a contingent
deferred sales charge and certain other fees are offered for purchase.
See note 2 for a discussion of contract expenses.
With certain exceptions, contract owners in either the accumulation or
the payout phase may invest in the following:
<TABLE>
<CAPTION>
<S> <C>
Portfolios of the American Century Variable Portfolios, Inc.(American Century VP);
American Century VP - American Century VP Balanced (ACVPBal)
American Century VP - American Century VP Capital Appreciation (ACVPCapAp)
American Century VP - American Century VP Income & Growth (ACVPIncGr)
American Century VP - American Century VP International (ACVPInt)
American Century VP - American Century VP Value (ACVPValue)
Funds of the American Variable Insurance Series (American VI
Series) (available only for contracts issued on or after May 1,
1987 and before September 1, 1989);
American VISeries - Growth Fund (AVISGro)
American VISeries - High-Yield Bond Fund (AVISHiYld)
American VISeries - U.S. Government/AAA-Rated Securities Fund (AVISGvt)
The Dreyfus Socially Responsible Growth Fund, Inc. (DrySRGro)
Dreyfus Stock Index Fund (DryStkIx)
Portfolios of the Dreyfus Variable Investment Fund (Dreyfus VIF);
Dreyfus VIF - Capital Appreciation Portfolio (DryCapAp)
Dreyfus VIF - Growth andIncome Portfolio (DryGrInc)
Portfolios of the Fidelity Variable Insurance Products Fund (Fidelity VIP);
Fidelity VIP - Equity-Income Portfolio (FidVIPEI)
Fidelity VIP - Growth Portfolio (FidVIPGr)
Fidelity VIP - High Income Portfolio (FidVIPHI)
Fidelity VIP - Overseas Portfolio (FidVIPOv)
Portfolios of the Fidelity Variable Insurance Products Fund II (Fidelity VIP-II);
Fidelity VIP-II - Asset Manager Portfolio (FidVIPAM)
Fidelity VIP-II - Contrafund Portfolio (FidVIPCon)
Portfolio of the Fidelity Variable Insurance Products Fund III (Fidelity VIP-III);
Fidelity VIP-III - Growth Opportunities Portfolio (FidVIPGrOp)
</TABLE>
19
<PAGE> 19
<TABLE>
<CAPTION>
<S> <C>
Portfolio of the Morgan Stanley Universal Funds, Inc. (Morgan Stanley);
Morgan Stanley - Emerging Markets Debt Portfolio (MSEmMkt)
Funds of the Nationwide Separate Account Trust (Nationwide SAT)
(managed for a fee by an affiliated investment advisor);
Nationwide SAT - Capital Appreciation Fund (NSATCapAp)
Nationwide SAT - Government Bond Fund (NSATGvtBd)
Nationwide SAT - Money Market Fund (NSATMyMkt)
Nationwide SAT - Small Cap Value Fund (NSATSmCapV)
Nationwide SAT - Small Company Fund (NSATSmCo)
Nationwide SAT - Total Return Fund (NSATTotRe)
Portfolios of the Neuberger & Berman Advisers Management Trust (Neuberger &Berman AMT);
Neuberger & Berman AMT - Growth Portfolio (NBAMTGro)
Neuberger & Berman AMT - Guardian Portfolio (NBAMTGuard)
Neuberger & Berman AMT - Limited Maturity Bond Portfolio (NBAMTLMat)
Neuberger & Berman AMT - Partners Portfolio (NBAMTPart)
Funds of the Oppenheimer Variable Account Funds (Oppenheimer VAF);
Oppenheimer VAF - Bond Fund (OppBdFd)
Oppenheimer VAF - Global Securities Fund (OppGlSec)
Oppenheimer VAF - Growth Fund (OppGro)
Oppenheimer VAF - Multiple Strategies Fund (OppMult)
Strong Opportunity Fund II, Inc. (StOpp2)
Funds of the Strong Variable Insurance Funds, Inc. (Strong VIF);
Strong VIF - Strong Discovery Fund II (StDisc2) Strong VIF -
Strong International Stock Fund II (StIntStk2)
Funds of the Van Eck Worldwide Insurance Trust (Van Eck WIT);
Van Eck WIT - Worldwide Bond Fund (VEWrldBd)
Van Eck WIT - Worldwide Emerging Markets Fund (VEWrldEMkt)
Van Eck WIT - Worldwide Hard Assets Fund (VEWrldHAs)
Portfolio of the Van Kampen Life Investment Trust (Van Kampen LIT);
Van Kampen LIT - Morgan Stanley Real Estate Securities Portfolio (MSRESec)
Portfolios of the Warburg Pincus Trust;
Warburg Pincus Trust - International Equity Portfolio (WPIntEq)
Warburg Pincus Trust - Post Venture Capital Portfolio (WPPVenCap)
Warburg Pincus Trust - Small Company Growth Portfolio (WPSmCoGr)
</TABLE>
At June 30, 1999, contract owners have invested in all of the above
funds. The contract owners' equity is affected by the investment
results of each fund, equity transactions by contract owners and
certain contract expenses (see note 2).
The accompanying financial statements include only contract owners'
purchase payments pertaining to the variable portions of their
contracts and exclude any purchase payments for fixed dollar benefits,
the latter being included in the accounts of the Company.
A contract owner may choose from among a number of different underlying
mutual fund options. The underlying mutual fund options are not
available to the general public directly. The underlying mutual funds
are available as investment options in variable life insurance policies
or variable annuity contracts issued by life insurance companies or, in
some cases, through participation in certain qualified pension or
retirement plans.
Some of the underlying mutual funds have been established by investment
advisers which manage publicly traded mutual funds having similar names
and investment objectives. While some of the underlying mutual funds
may be similar to, and may in fact be modeled after, publicly traded
mutual funds, the underlying mutual funds are not otherwise directly
related to any publicly traded mutual fund. Consequently, the
investment performance of publicly traded mutual funds and any
corresponding underlying mutual funds may differ substantially.
20
<PAGE> 20
(c) Security Valuation, Transactions and Related Investment Income
The market value of the underlying mutual funds is based on the closing
net asset value per share at June 30, 1999. The cost of investments
sold is determined on the specific identification basis. Investment
transactions are accounted for on the trade date (date the order to buy
or sell is executed) and dividend income is recorded on the ex-dividend
date.
(d) Federal Income Taxes
Operations of the Account form a part of, and are taxed with,
operations of the Company which is taxed as a life insurance company
under the Internal Revenue Code.
The Company does not provide for income taxes within the Account. Taxes
are the responsibility of the contract owner upon termination or
withdrawal.
(e) Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles may require management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities, if
any, at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results
could differ from those estimates.
(2) EXPENSES
The Company does not deduct a sales charge from purchase payments received
from the contract owners. However, if any part of the contract value of
such contracts is surrendered the Company will, with certain exceptions,
deduct from a contract owner's contract value a contingent deferred sales
charge. For contracts issued prior to December 15, 1988, the contingent
deferred sales charge will be equal to 5% of the lesser of the total of all
purchase payments made within 96 months prior to the date of the request
for surrender or the amount surrendered. For contracts issued on or after
December 15, 1988, the Company will deduct a contingent deferred sales
charge not to exceed 7% of the lesser of purchase payments or the amount
surrendered, such charge declining 1% per year, to 0%, after the purchase
payment has been held in the contract for 84 months. No sales charges are
deducted on redemptions used to purchase units in the fixed investment
options of the Company.
The following contract charges are deducted by the Company: (a) for The
BEST OF AMERICA(R) contracts, an annual contract maintenance charge of up
to $30, dependent on contract type and issue date, which is satisfied by
surrendering units; and (b) for The BEST OF AMERICA(R) contracts issued
prior to December 15, 1988, a charge for mortality and expense risk
assessed through the daily unit value calculation equal to an annual rate
of 0.80% and 0.50%, respectively; for The BEST OF AMERICA(R) contracts
issued on or after December 15, 1988, a mortality risk charge, an expense
risk charge and an administration charge assessed through the daily unit
value calculation equal to an annual rate of 0.80%, 0.45% and 0.05%,
respectively; for The BEST OF AMERICA(R) America's Vision Annuity(SM)
contracts, a mortality risk charge, an expense risk charge and an
administration charge assessed through the daily unit value calculation
equal to an annual rate of 0.80%, 0.45% and 0.15%, respectively; and for
The BEST OF AMERICA(R) Nationwide Insurance Enterprise Annuity contracts, a
mortality risk charge assessed through the daily unit value calculation
equal to an annual rate of 0.80%.
(3) RELATED PARTY TRANSACTIONS
The Company performs various services on behalf of the Mutual Fund
Companies in which the Account invests and may receive fees for the
services performed. These services include, among other things, shareholder
communications, preparation, postage, fund transfer agency and various
other record keeping and customer service functions. These fees are paid to
an affiliate of the Company.
21
<PAGE> 21
(4) COMPONENTS OF CONTRACT OWNERS' EQUITY
The following is a summary of contract owners' equity at June 30, 1999, for
each series, in both the accumulation and payout phases.
<TABLE>
<CAPTION>
PERIOD
Contract owners' equity represented by: UNITS UNIT VALUE RETURN*
--------- ----------- -------
Contracts in accumulation phase:
<S> <C> <C> <C> <C>
The BEST OF AMERICA(R) contracts:
American Century VP -
American Century VP Balanced:
Tax qualified.............................. 3,234,753 $ 19.322019 $ 62,501,959 3%
Non-tax qualified.......................... 2,475,479 19.322019 47,831,252 3%
American Century VP -
American Century VP Capital Appreciation:
Tax qualified.............................. 5,023,302 25.179076 126,482,103 15%
Non-tax qualified.......................... 2,787,469 25.179076 70,185,894 15%
American Century VP -
American Century VP Income & Growth:
Tax qualified.............................. 1,725,147 11.805502 20,366,226 9%
Non-tax qualified.......................... 1,622,917 11.805502 19,159,350 9%
American Century VP -
American Century VP International:
Tax qualified.............................. 5,000,729 17.194193 85,983,500 7%
Non-tax qualified.......................... 3,875,935 17.194193 66,643,574 7%
American Century VP -
American Century VP Value:
Tax qualified.............................. 1,424,056 14.678541 20,903,064 12%
Non-tax qualified.......................... 1,574,279 14.678541 23,108,119 12%
American VI Series - Growth Fund:
Tax qualified.............................. 354,359 51.909060 18,394,443 23%
Non-tax qualified.......................... 324,105 51.909060 16,823,986 23%
American VI Series -
High-Yield Bond Fund:
Tax qualified.............................. 57,557 26.276992 1,512,425 3%
Non-tax qualified.......................... 32,495 26.276992 853,871 3%
American VI Series - U.S. Government/
AAA-Rated Securities Fund:
Tax qualified.............................. 118,482 20.646137 2,446,196 (2)%
Non-tax qualified.......................... 73,645 20.646137 1,520,485 (2)%
The Dreyfus Socially Responsible
Growth Fund, Inc.:
Tax qualified.............................. 3,953,405 30.902126 122,168,619 12%
Non-tax qualified.......................... 2,020,847 30.902126 62,448,469 12%
Dreyfus Stock Index Fund:
Tax qualified.............................. 18,402,956 30.474479 560,820,496 11%
Non-tax qualified.......................... 12,148,447 30.474479 370,217,593 11%
Dreyfus VIF -
Capital Appreciation Portfolio:
Tax qualified.............................. 4,268,309 13.992265 59,723,311 7%
Non-tax qualified.......................... 3,417,338 13.992265 47,816,299 7%
Dreyfus VIF -
Growth and Income Portfolio:
Tax qualified.............................. 1,470,024 13.952585 20,510,635 10%
Non-tax qualified.......................... 898,703 13.952585 12,539,230 10%
</TABLE>
22
<PAGE> 22
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Fidelity VIP - Equity-Income Portfolio:
Tax qualified.............................. 21,113,998 43.744874 923,629,182 12%
Non-tax qualified.......................... 15,301,767 43.744874 669,373,869 12%
Fidelity VIP - Growth Portfolio:
Tax qualified.............................. 18,162,267 73.433363 1,333,716,346 14%
Non-tax qualified.......................... 11,545,720 73.433363 847,841,048 14%
Fidelity VIP - High Income Portfolio:
Tax qualified.............................. 5,716,649 28.883354 165,115,997 7%
Non-tax qualified.......................... 5,570,332 28.883354 160,889,871 7%
Fidelity VIP - Overseas Portfolio:
Tax qualified.............................. 10,512,149 21.813554 229,307,330 7%
Non-tax qualified.......................... 8,515,817 21.813554 185,760,234 7%
Fidelity VIP-II - Asset Manager Portfolio:
Tax qualified.............................. 17,421,844 28.881589 503,170,538 5%
Non-tax qualified.......................... 9,945,122 28.881589 287,230,926 5%
Fidelity VIP-II - Contrafund Portfolio:
Tax qualified.............................. 17,036,283 23.031155 392,365,274 11%
Non-tax qualified.......................... 11,965,802 23.031155 275,586,241 11%
Fidelity VIP-III -
Growth Opportunities Portfolio:
Tax qualified.............................. 3,552,339 14.224667 5,530,839 6%
Non-tax qualified.......................... 2,459,045 14.224667 34,979,096 6%
Morgan Stanley -
Emerging Markets Debt Portfolio:
Tax qualified.............................. 273,409 7.782426 2,127,785 12%
Non-tax qualified.......................... 235,602 7.782426 1,833,555 12%
Nationwide SAT -
Capital Appreciation Fund:
Tax qualified.............................. 6,269,915 34.047394 213,474,266 11%
Non-tax qualified.......................... 5,025,769 34.047394 171,114,337 11%
Nationwide SAT -
Government Bond Fund:
Tax qualified.............................. 3,821,891 34.260857 130,941,261 (3)%
Non-tax qualified.......................... 3,080,461 34.170358 105,260,455 (3)%
Nationwide SAT - Money Market Fund:
Tax qualified.............................. 11,601,141 24.282403 281,703,581 2%
Non-tax qualified.......................... 11,991,240 24.282403 291,176,122 2%
Nationwide SAT - Small Cap Value Fund:
Tax qualified.............................. 1,164,872 10.479095 12,206,804 23%
Non-tax qualified.......................... 1,461,242 10.479095 15,312,494 23%
Nationwide SAT - Small Company Fund:
Tax qualified.............................. 4,294,390 17.077954 73,339,395 7%
Non-tax qualified.......................... 2,498,877 17.077954 42,675,706 7%
Nationwide SAT - Total Return Fund:
Tax qualified.............................. 4,305,921 102.724125 442,321,967 10%
Non-tax qualified.......................... 3,054,139 100.078914 305,654,914 10%
Neuberger & Berman AMT -
Growth Portfolio:
Tax qualified.............................. 4,152,627 44.221607 183,635,839 2%
Non-tax qualified.......................... 2,910,065 44.221607 128,687,151 2%
Neuberger & Berman AMT -
Guardian Portfolio:
Tax qualified.............................. 1,636,559 10.813704 17,697,265 16%
Non-tax qualified.......................... 1,163,802 10.813704 12,585,010 16%
(Continued)
</TABLE>
23
<PAGE> 23
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Neuberger &Berman AMT -
Limited Maturity Bond Portfolio:
Tax qualified.............................. 2,680,861 18.168779 48,707,971 0%
Non-tax qualified.......................... 2,522,583 18.168779 45,832,253 0%
Neuberger & Berman AMT -
Partners Portfolio:
Tax qualified.............................. 6,436,059 25.876629 166,543,511 13%
Non-tax qualified.......................... 3,967,698 25.876629 102,670,649 13%
Oppenheimer VAF - Bond Fund:
Tax qualified.............................. 4,222,481 19.270538 81,369,481 (2)%
Non-tax qualified.......................... 3,423,695 19.270538 65,976,445 (2)%
Oppenheimer VAF -
Global Securities Fund:
Tax qualified.............................. 9,009,558 20.412655 183,908,999 13%
Non-tax qualified.......................... 5,276,504 20.412655 107,707,456 13%
Oppenheimer VAF - Growth Fund:
Tax qualified.............................. 3,518,951 14.686183 51,679,958 15%
Non-tax qualified.......................... 2,024,027 14.686183 29,725,231 15%
Oppenheimer VAF -
Multiple Strategies Fund:
Tax qualified.............................. 4,205,671 23.685327 99,612,693 8%
Non-tax qualified.......................... 2,945,835 23.685327 69,773,065 8%
Strong Opportunity Fund II, Inc.:
Tax qualified.............................. 9,849,736 34.775677 342,531,238 19%
Non-tax qualified.......................... 6,162,608 34.775677 214,308,865 19%
Strong VIF - Strong Discovery Fund II:
Tax qualified.............................. 2,855,527 17.637548 50,364,495 (6)%
Non-tax qualified.......................... 2,044,199 17.637548 36,054,658 (6)%
Strong VIF -
Strong International Stock Fund II:
Tax qualified.............................. 992,387 9.879979 9,804,763 11%
Non-tax qualified.......................... 782,214 9.879979 7,728,258 11%
Van Eck WIT - Worldwide Bond Fund:
Tax qualified.............................. 1,574,664 15.168513 23,885,311 (8)%
Non-tax qualified.......................... 1,535,489 15.168513 23,291,085 (8)%
Van Eck WIT -
Worldwide Emerging Markets Fund:
Tax qualified.............................. 3,872,582 8.287687 32,094,747 45%
Non-tax qualified.......................... 3,999,605 8.287687 28,174,862 45%
Van Eck WIT -
Worldwide Hard Assets Fund:
Tax qualified.............................. 1,897,093 12.620722 23,942,683 17%
Non-tax qualified.......................... 1,942,523 12.620722 24,516,043 17%
Van Kampen LIT - Morgan Stanley
Real Estate Securities Portfolio:
Tax qualified.............................. 1,870,731 16.833721 31,491,364 8%
Non-tax qualified.......................... 1,868,366 16.833721 31,451,552 8%
Warburg Pincus Trust -
International Equity Portfolio:
Tax qualified.............................. 4,231,500 12.330740 52,177,526 6%
Non-tax qualified.......................... 3,118,043 12.330740 38,447,778 6%
Warburg Pincus Trust -
Post Venture Capital Portfolio:
Tax qualified.............................. 486,831 13.387269 6,517,338 12%
Non-tax qualified.......................... 551,082 13.387269 7,377,483 12%
</TABLE>
24
<PAGE> 24
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Warburg Pincus Trust -
Small Company Growth Portfolio:
Tax qualified.............................. 4,929,904 16.220417 79,965,099 6%
Non-tax qualified.......................... 3,639,298 16.220417 59,030,931 6%
The BEST OF AMERICA(R) Nationwide Insurance
Enterprise Annuity contracts:
American Century VP -
American Century VP Balanced:
Tax qualified.............................. 15,510 15.560004 241,336 4%
Non-tax qualified ......................... 8,749 15.560004 136,134 4%
American Century VP -
American Century VP Capital Appreciation:
Tax qualified.............................. 9,150 10.098510 92,401 16%
Non-tax qualified.......................... 12,778 10.098510 129,039 16%
American Century VP -
American Century VP Income & Growth:
Tax qualified.............................. 546 11.875091 6,484 9%
Non-tax qualified.......................... 3,577 11.875091 42,477 9%
American Century VP -
American Century VP International:
Tax qualified.............................. 4,263 17.422535 74,272 7%
Non-tax qualified.......................... 11,860 17.422535 206,631 7%
American Century VP -
American Century VP Value:
Tax qualified.............................. 1,573 14.866345 23,385 13%
Non-tax qualified.......................... 10,133 14.866345 150,641 13%
The Dreyfus Socially Responsible
Growth Fund, Inc.:
Tax qualified.............................. 15,593 22.818698 355,812 12%
Non-tax qualified.......................... 14,251 22.818698 325,189 12%
Dreyfus Stock Index Fund:
Tax qualified.............................. 77,181 24.086276 1,859,003 12%
Non-tax qualified.......................... 68,765 24.086276 1,656,293 12%
Dreyfus VIF -
Capital Appreciation Portfolio:
Tax qualified.............................. 8,758 14.131473 123,763 7%
Non-tax qualified.......................... 18,967 14.131473 268,032 7%
Dreyfus VIF -
Growth and Income Portfolio:
Tax qualified.............................. 18,052 14.131094 255,095 11%
Non-tax qualified.......................... 12,711 14.131094 179,620 11%
Fidelity VIP - Equity-Income Portfolio:
Tax qualified.............................. 53,813 19.214686 1,034,000 12%
Non-tax qualified.......................... 50,985 19.214686 979,661 12%
Fidelity VIP - Growth Portfolio:
Tax qualified.............................. 74,966 21.195347 1,588,930 14%
Non-tax qualified.......................... 68,511 21.195347 1,452,114 14%
Fidelity VIP - High Income Portfolio:
Tax qualified.............................. 19,372 13.684479 265,096 8%
Non-tax qualified.......................... 19,869 13.684479 271,897 8%
Fidelity VIP - Overseas Portfolio:
Tax qualified.............................. 961 15.694737 15,083 8%
Non-tax qualified.......................... 4,549 15.694737 71,395 8%
(Continued)
</TABLE>
25
<PAGE> 25
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Fidelity VIP-II - Asset Manager Portfolio:
Tax qualified.............................. 12,678 17.150035 217,428 5%
Non-tax qualified.......................... 13,475 17.150035 231,097 5%
Fidelity VIP-II - Contrafund Portfolio:
Tax qualified.............................. 23,654 21.612534 511,223 11%
Non-tax qualified.......................... 25,185 21.612534 544,312 11%
Fidelity VIP-III -
Growth Opportunities Portfolio:
Tax qualified.............................. 5,838 14.366195 83,870 6%
Non-tax qualified.......................... 9,466 14.366195 135,990 6%
Morgan Stanley -
Emerging Markets Debt Portfolio:
Tax qualified.............................. 52 7.860012 409 13%
Non-tax qualified.......................... 131 7.860012 1,030 13%
Nationwide SAT -
Capital Appreciation Fund:
Tax qualified.............................. 98,665 25.825581 2,548,081 11%
Non-tax qualified.......................... 96,018 25.825581 2,479,721 11%
Nationwide SAT -
Government Bond Fund:
Tax qualified.............................. 40,733 12.064451 491,421 (3)%
Non-tax qualified.......................... 35,508 12.064451 564,435 (3)%
Nationwide SAT - Money Market Fund:
Tax qualified.............................. 110,642 11.674145 1,291,651 2%
Non-tax qualified.......................... 87,371 11.674145 1,019,902 2%
Nationwide SAT - Small Cap Value Fund:
Tax qualified.............................. 1,772 10.540921 18,679 23%
Non-tax qualified.......................... 7,601 10.540921 80,122 23%
Nationwide SAT - Small Company Fund:
Tax qualified.............................. 20,227 17.384086 351,628 7%
Non-tax qualified.......................... 34,677 17.384086 602,828 7%
Nationwide SAT - Total Return Fund:
Tax qualified.............................. 187,658 21.053855 3,950,924 10%
Non-tax qualified.......................... 181,346 21.053855 3,818,032 10%
Neuberger & Berman AMT -
Growth Portfolio:
Tax qualified.............................. 9,218 16.246061 149,756 3%
Non-tax qualified.......................... 13,419 16.246061 218,006 3%
Neuberger & Berman AMT -
Guardian Portfolio:
Tax qualified.............................. 1,454 10.877466 15,816 17%
Non-tax qualified.......................... 12,603 10.877466 137,089 17%
Neuberger & Berman AMT -
Limited Maturity Bond Portfolio:
Tax qualified.............................. 2,361 11.542197 27,251 0%
Non-tax qualified.......................... 4,876 11.542197 56,280 0%
Neuberger & Berman AMT -
Partners Portfolio:
Tax qualified.............................. 28,440 20.630675 586,736 13%
Non-tax qualified.......................... 23,102 20.630675 476,610 13%
Oppenheimer VAF - Bond Fund:
Tax qualified.............................. 26,286 12.023907 316,060 (2)%
Non-tax qualified.......................... 18,814 12.023907 226,218 (2)%
</TABLE>
26
<PAGE> 26
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Oppenheimer VAF -
Global Securities Fund:
Tax qualified.............................. 8,105 18.366982 148,864 13%
Non-tax qualified.......................... 9,167 18.366982 168,370 13%
Oppenheimer VAF - Growth Fund:
Tax qualified.............................. 12,669 14.832325 187,911 15%
Non-tax qualified.......................... 6,166 14.832325 91,456 15%
Oppenheimer VAF -
Multiple Strategies Fund:
Tax qualified.............................. 14,782 15.689055 231,916 8%
Non-tax qualified.......................... 10,860 15.689055 170,383 8%
Strong Opportunity Fund II, Inc.:
Tax qualified.............................. 19,154 20.737964 397,215 19%
Non-tax qualified.......................... 16,602 20.737964 344,292 19%
Strong VIF - Strong Discovery Fund II:
Tax qualified.............................. 850 11.591822 9,853 (6)%
Non-tax qualified.......................... 3,362 11.591822 38,972 (6)%
Strong VIF -
Strong International Stock Fund II:
Tax qualified.............................. 3,674 10.007202 36,766 11%
Non-tax qualified.......................... 510 10.007202 5,104 11%
Van Eck WIT - Worldwide Bond Fund:
Tax qualified.............................. 367 10.818796 3,970 (7)%
Non-tax qualified.......................... 1,128 10.818796 12,204 (7)%
Van Eck WIT -
Worldwide Emerging Markets Fund:
Tax qualified.............................. 21,406 8.393816 179,678 45%
Non-tax qualified.......................... 18,823 8.393816 157,997 45%
Van Eck WIT -
Worldwide Hard Assets Fund:
Tax qualified.............................. 2,041 10.189491 20,797 18%
Non-tax qualified.......................... 8,695 10.189491 88,598 18%
Van Kampen LIT - Morgan Stanley
Real Estate Securities Portfolio:
Tax qualified.............................. 4,482 16.867354 75,599 8%
Non-tax qualified.......................... 10,253 16.867354 172,941 8%
Warburg Pincus Trust -
International Equity Portfolio:
Tax qualified.............................. 3,611 12.200117 44,055 6%
Non-tax qualified.......................... 2,834 12.200117 34,575 6%
Warburg Pincus Trust -
Post Venture Capital Portfolio:
Tax qualified.............................. 866 13.558595 11,742 12%
Non-tax qualified.......................... 2,898 13.558595 39,293 12%
Warburg Pincus Trust -
Small Company Growth Portfolio:
Tax qualified.............................. 11,319 14.816258 167,705 6%
Non-tax qualified.......................... 24,071 14.816258 356,642 6%
The BEST OF AMERICA(R) America's Vision
Annuity(SM) contracts:
American Century VP -
American Century VP Balanced:
Tax qualified.............................. 2,368,104 17.764505 42,068,195 3%
Non-tax qualified.......................... 3,229,493 17.764505 57,370,345 3%
(Continued)
</TABLE>
27
<PAGE> 27
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
American Century VP -
American Century VP Capital Appreciation:
Tax qualified.............................. 1,890,896 12.800556 24,204,520 15%
Non-tax qualified.......................... 2,769,455 12.800556 35,450,564 15%
American Century VP -
American Century VP Income & Growth:
Tax qualified.............................. 1,225,015 11.791575 14,444,856 9%
Non-tax qualified.......................... 1,353,605 11.791575 15,961,135 9%
American Century VP -
American Century VP International:
Tax qualified.............................. 3,671,489 17.108826 62,814,866 7%
Non-tax qualified.......................... 5,268,655 17.108826 90,140,502 7%
American Century VP -
American Century VP Value:
Tax qualified.............................. 1,366,250 14.641154 20,003,477 12%
Non-tax qualified.......................... 2,063,558 14.641154 30,212,870 12%
The Dreyfus Socially Responsible
Growth Fund, Inc.:
Tax qualified.............................. 2,293,150 29.112733 66,759,864 12%
Non-tax qualified.......................... 2,941,689 29.112733 85,640,606 12%
Dreyfus Stock Index Fund:
Tax qualified.............................. 15,210,194 30.210588 459,508,904 11%
Non-tax qualified.......................... 21,148,161 30.210588 638,898,379 11%
Dreyfus VIF -
Capital Appreciation Portfolio:
Tax qualified.............................. 3,111,691 13.964500 43,453,209 7%
Non-tax qualified.......................... 4,405,179 13.964500 61,516,122 7%
Dreyfus VIF -
Growth and Income Portfolio:
Tax qualified.............................. 1,465,400 13.917036 20,394,025 10%
Non-tax qualified.......................... 2,045,824 13.917036 28,471,806 10%
Fidelity VIP - Equity-Income Portfolio:
Tax qualified.............................. 20,153,946 25.129305 506,454,656 12%
Non-tax qualified.......................... 28,070,724 25.129305 705,397,785 12%
Fidelity VIP - Growth Portfolio:
Tax qualified.............................. 15,972,433 28.959466 462,533,130 14%
Non-tax qualified.......................... 22,579,542 28.959466 653,891,479 14%
Fidelity VIP - High Income Portfolio:
Tax qualified.............................. 9,413,456 15.444036 145,381,753 7%
Non-tax qualified.......................... 14,074,617 15.444036 217,368,892 7%
Fidelity VIP - Overseas Portfolio:
Tax qualified.............................. 4,187,806 16.697821 69,927,235 7%
Non-tax qualified.......................... 6,525,672 16.697821 108,964,503 7%
Fidelity VIP-II - Asset Manager Portfolio:
Tax qualified.............................. 7,781,714 17.594332 136,914,060 5%
Non-tax qualified.......................... 10,147,625 17.594332 178,540,683 5%
Fidelity VIP-II - Contrafund Portfolio:
Tax qualified.............................. 13,750,257 22.938209 315,406,269 10%
Non-tax qualified.......................... 18,612,954 22.938209 426,947,829 10%
Fidelity VIP-III -
Growth Opportunities Portfolio:
Tax qualified.............................. 3,231,127 14.196438 45,870,494 6%
Non-tax qualified.......................... 4,684,377 14.196438 66,501,468 6%
</TABLE>
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<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Morgan Stanley -
Emerging Markets Debt Portfolio:
Tax qualified.............................. 166,933 7.766958 1,296,562 12%
Non-tax qualified.......................... 375,188 7.766958 2,914,069 12%
Nationwide SAT -
Capital Appreciation Fund:
Tax qualified.............................. 4,502,483 30.094617 135,500,501 11%
Non-tax qualified.......................... 5,917,963 30.094617 178,098,830 11%
Nationwide SAT -
Government Bond Fund:
Tax qualified.............................. 5,319,640 12.885276 68,545,030 (3)%
Non-tax qualified.......................... 7,012,965 12.885276 90,363,990 (3)%
Nationwide SAT - Money Market Fund:
Tax qualified.............................. 15,894,587 12.116860 192,592,485 2%
Non-tax qualified.......................... 23,178,121 12.116860 280,846,047 2%
Nationwide SAT - Small Cap Value Fund:
Tax qualified.............................. 840,588 10.466741 8,798,217 23%
Non-tax qualified.......................... 1,088,410 10.466741 11,392,106 23%
Nationwide SAT - Small Company Fund:
Tax qualified.............................. 3,346,752 17.014291 56,942,612 7%
Non-tax qualified.......................... 4,199,899 17.014291 71,458,304 7%
Nationwide SAT - Total Return Fund:
Tax qualified.............................. 9,788,684 25.128765 245,977,540 10%
Non-tax qualified.......................... 11,532,306 25.128765 289,792,607 10%
Neuberger & Berman AMT -
Growth Portfolio:
Tax qualified.............................. 1,898,305 19.596928 37,200,946 2%
Non-tax qualified.......................... 3,145,351 19.596928 61,639,217 2%
Neuberger & Berman AMT -
Guardian Portfolio:
Tax qualified.............................. 1,674,203 10.800946 18,082,976 16%
Non-tax qualified.......................... 1,690,344 10.800946 18,257,314 16%
Neuberger & Berman AMT -
Limited Maturity Bond Portfolio:
Tax qualified.............................. 1,866,018 11.971834 22,339,658 0%
Non-tax qualified.......................... 3,236,997 11.971834 38,752,791 0%
Neuberger & Berman AMT -
Partners Portfolio:
Tax qualified.............................. 5,516,939 25.748195 142,051,221 12%
Non-tax qualified.......................... 7,975,724 25.748195 205,360,497 12%
Oppenheimer VAF - Bond Fund:
Tax qualified.............................. 5,546,356 12.848815 71,264,102 (2)%
Non-tax qualified.......................... 7,540,169 12.848815 96,882,237 (2)%
Oppenheimer VAF -
Global Securities Fund:
Tax qualified.............................. 6,443,888 18.679421 120,368,097 13%
Non-tax qualified.......................... 8,820,802 18.679421 164,767,474 13%
Oppenheimer VAF - Growth Fund:
Tax qualified.............................. 2,290,955 14.657042 33,578,624 15%
Non-tax qualified.......................... 2,123,758 14.657042 31,128,010 15%
Oppenheimer VAF -
Multiple Strategies Fund:
Tax qualified.............................. 3,756,574 17.537832 65,882,164 8%
Non-tax qualified.......................... 4,642,841 17.537832 81,425,365 8%
(Continued)
</TABLE>
29
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<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Strong Opportunity Fund II, Inc.:
Tax qualified.............................. 4,867,382 25.478401 124,013,110 19%
Non-tax qualified.......................... 6,468,505 25.478401 164,807,164 19%
Strong VIF - Strong Discovery Fund II:
Tax qualified.............................. 1,376,140 14.561712 20,038,954 (6)%
Non-tax qualified.......................... 2,027,804 14.561712 29,528,298 (6)%
Strong VIF -
Strong International Stock Fund II:
Tax qualified.............................. 874,069 9.843121 8,603,567 10%
Non-tax qualified.......................... 1,267,343 9.843121 12,474,610 10%
Van Eck WIT - Worldwide Bond Fund:
Tax qualified.............................. 1,024,036 12.015012 12,303,805 (8)%
Non-tax qualified.......................... 1,584,570 12.015012 19,038,628 (8)%
Van Eck WIT -
Worldwide Emerging Markets Fund:
Tax qualified.............................. 2,632,034 8.266542 21,757,820 45%
Non-tax qualified.......................... 2,983,848 8.266542 24,666,105 45%
Van Eck WIT -
Worldwide Hard Assets Fund:
Tax qualified.............................. 938,582 10.329233 9,694,832 17%
Non-tax qualified.......................... 1,679,319 10.329233 17,346,077 17%
Van Kampen LIT - Morgan Stanley
Real Estate Securities Portfolio:
Tax qualified.............................. 2,470,539 16.765775 41,420,501 8%
Non-tax qualified.......................... 1,786,336 16.765775 29,949,307 8%
Warburg Pincus Trust -
International Equity Portfolio:
Tax qualified.............................. 3,473,891 12.280978 42,662,779 6%
Non-tax qualified.......................... 5,900,123 12.280978 72,459,281 6%
Warburg Pincus Trust -
Post Venture Capital Portfolio:
Tax qualified.............................. 377,721 13.353153 5,043,766 12%
Non-tax qualified.......................... 585,087 13.353153 7,812,756 12%
Warburg Pincus Trust -
Small Company Growth Portfolio:
Tax qualified.............................. 3,287,488 16.154912 53,109,079 6%
Non-tax qualified.......................... 5,268,795 16.154912 85,116,920 6%
========== ===========
Reserves for annuity contracts in
payout phase:
Tax qualified.............................. 4,681,233
Non-tax qualified.............................. 11,654,346
----------------
$ 22,044,140,566
================
</TABLE>
* The period return does not include contract charges satisfied by surrendering
units.
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--------------
NATIONWIDE LIFE INSURANCE COMPANY Bulk Rate
HOME OFFICE: ONE NATIONWIDE PLAZA - COLUMBUS, OHIO 43215-2220 U.S. Postage
PAID
Columbus, Ohio
Permit No. 521
--------------
Nationwide(R) is a registered federal service mark of Nationwide Mutual
Insurance Company
