GENERAL MUNICIPAL BOND FUND, INC
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to provide you with this report on the General Municipal
Bond Fund, Inc. For its semi-annual reporting period ended August 31, 1996,
your Fund produced a total return, including bond price changes, interest
income and capital gain distributions of -.42%.* Income dividends exempt from
Federal personal income taxes of approximately $.398 per share were paid to
shareholders.** This is equivalent to an annualized tax-free distribution
rate per share of 5.46%.***
THE ECONOMY
Recent reports indicating some moderation in the rate of economic growth,
low unemployment and benign inflation have so far deferred the
well-anticipated hiking of short-term interest rates by the Federal Reserve
Board's Open Market Committee (the "Fed"). Ever alert to signs of price
pressures that could rekindle inflation, the Central Bank left the Fed Funds
rate unchanged at 5.25% at the Fed's meeting on August 20. The Fed has not
raised short-term interest rates since February 1, 1995. Since then, monetary
policy has tended to lower the cost of short-term credit. Investors have
grown increasingly wary that, as the economy continues to expand, the Fed
would apply the monetary brakes to ward off higher levels of inflation.
Reports throughout the year of strong increases in new jobs and the decline
in the unemployment rate have been widely viewed as harbingers of wage
pressures that could lead to undesirable inflationary consequences. The bond
market has been particularly volatile in its anticipation of Federal Reserve
restraint - since January, long-term interest rates have risen a full
percentage point. Despite all this, inflation, both at the consumer and at
the production level, has remained subdued. The latest reports indicated that
both the Consumer and Producer Price Indices remained in the 3% range over
the past twelve months. Prices at earlier stages of the manufacturing process
fell over the past two months, lending credence to those who foresee a flat
inflation curve.
There has been some recent evidence that the economy may be reflecting
the effects of the rise in long-term interest earlier in the year. Retail
sales have slackened recently. In July, housing starts declined for the third
consecutive month and sales of existing homes also fell. On the production
side of the economy, latest reports on industrial output also showed signs of
moderation. In July, factory production rose only .1%, its smallest monthly
increase in four months. Despite these anecdotal signs of slowing, several
indicators of future economic activity remained positive. The Index of
Leading Economic Indicators has been on the rise since early this year, and
the Conference Board's Consumer Confidence Index reached a six-year high in
August. While rising consumer confidence is favorable for business (and
political incumbents), it could complicate the efforts of the Federal Reserve
to maintain its hands-off posture. We remain alert to any indications that
the economy may be entering a phase of undue expansion.
MARKET ENVIRONMENT
Despite this year's larger than normal degree of price volatility, the
municipal bond market has performed much better than its taxable
counterparts. This fact is attributable to the strong technical shape of the
municipal market. The supply of new tax-exempt issues continues to dwindle.
It appears as though 1996 will mark the second consecutive year of declining
municipal bond issuance. Yet, increasing amounts of tax-exempt bonds have
either matured or been called from the marketplace this year, leaving a
widening gap between strong investor demand and the available supply. So even
during those periods
when the fixed income markets are succumbing to higher yields and falling
prices, the effect on municipal holdings has been mitigated to a degree.
It now appears that municipal securities held by individuals may be
spared from any major reform to the Federal tax code. While fairer and
flatter tax talk is part of both Presidential candidates' campaign rhetoric,
the market's reaction has been muted enough to suggest that there is no cause
for concern. In fact, the willingness which individuals are currently
displaying to purchase tax-exempt securities suggests just the opposite.
Looking forward, we expect retail participation in the market to sustain
itself. Even more attention could be focused on municipals if investors turn
to bonds and away from stocks should there be a growing perception that the
economy is slowing from its strong pace of earlier this year.
THE PORTFOLIO
Since our last report to shareholders, both the market and the structure
of your Fund have undergone a transformation. Following a shift to a more
defensive posture during the first half of the year, we reacted to what was
perceived as excessive pessimism by bond traders. By this time, bond yields
had already risen by 1%; by late spring, a buying opportunity occurred and
the duration of the Fund was extended. The market did rally and the Fund's
value rose. While the economic data continues to paint an ambiguous picture,
the consensus bet is for at least a modest tightening move by the Fed before
year-end. Ever mindful of the market's propensity to anticipate such changes
in Fed monetary policy, we are again assuming a more cautious posture until
the smoke clears!
With a dearth of municipal supply available and no prospects in the near
future for a reversal in the current state of affairs, we continue to have a
favorable longer-term outlook for the market. However, in the meantime, the
path to lower yields (and higher prices) could continue to be a bumpy one.
Included in this report is a series of detailed statements about your
Fund's holdings and its financial condition. We hope they are informative.
Please know that we greatly appreciate your continued confidence in the Fund
and in The Dreyfus Corporation.
Very truly yours,
(Richard J. Moynihan)
Richard J. Moynihan
Director, Municipal Portfolio Management
The Dreyfus Corporation
September 12, 1996
New York, N.Y.
* Total return includes reinvestment of dividends and any capital gains
paid.
** Some income may be subject to the Federal Alternative Minimum Tax (AMT)
for certain shareholders.
*** Annualized distribution rate per share is based upon dividends per share
paid from net investment income during the period, divided by the net asset
value per share at the end of the period, adjusted for capital gain
distributions.
<TABLE>
<CAPTION>
GENERAL MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS AUGUST 31, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS-98.0% AMOUNT VALUE
----------- -------------
<S> <C> <C>
CALIFORNIA-.8%
San Diego Public Facilities Financing Authority, Sewer Revenue
5%, 5/15/2025 (Insured; FGIC)........................................... $ 6,500,000 $ 5,747,690
COLORADO-9.2%
Colorado Housing Finance Authority, Single Family Program 7.55%, 8/1/2023... 3,275,000 3,422,375
Denver City and County:
Airport System Revenue:
7.25%, 11/15/2007 (Insured; MBIA)..................................... 6,250,000 6,936,875
7.25%, 11/15/2012..................................................... 5,100,000 5,438,079
8.25%, 11/15/2012..................................................... 4,505,000 5,098,624
7.75%, 11/15/2021..................................................... 6,760,000 7,472,166
7.25%, 11/15/2023..................................................... 5,185,000 5,467,375
5.50%, 11/15/2025 (Insured; MBIA)..................................... 10,000,000 9,438,500
8%, 11/15/2025.... ............................................ 5,250,000 5,835,532
Special Facilities Airport Revenue (United Airlines Project) 6.875%, 10/1/2032 11,235,000 11,423,186
Lakewood, MFHR, Mortgage 6.70%, 10/1/2036 (Insured; FHA).................... 5,000,000 5,141,400
DISTRICT OF COLUMBIA-1.1%
District of Columbia, HR, Refunding (National Rehabilitation Hospital -
Medlantic)
7.10%, 11/1/2011 (Insured; MBIA) (Prerefunded 11/1/1999) (a)............ 7,000,000 7,659,750
FLORIDA-10.3%
Collier County School Board, COP 5%, 2/15/2016 (Insured; FSA)............... 7,550,000 6,863,025
Dade County, Refunding:
(Seaport) 5.125%, 10/1/2021 (Insured; MBIA)............................. 15,210,000 13,814,330
Special Obligation 5%, 10/1/2035 (Insured; AMBAC)....................... 6,500,000 5,676,645
Dade County School Board, COP 5.50%, 5/1/2025 (Insured; AMBAC).............. 6,000,000 5,665,560
Gainesville, Utilities System Revenue, Refunding 5.20%, 10/1/2022........... 12,085,000 11,017,411
Lakeland, Electric and Water Revenue, Refunding and Improvement
5.625%, 10/1/2019....................................................... 6,000,000 5,804,040
Palm Beach County, Solid Waste IDR (Osceola Power Ltd. Partnership)
6.95%, 1/1/2022......................................................... 3,000,000 2,626,260
Pinellas County Housing Facilities Authority, SFMR (Multi-County Program)
6.70%, 2/1/2028 (Insured; FHA).......................................... 7,500,000 7,639,575
Polk County Industrial Development Authority, IDR 7.525%, 1/1/2015.......... 13,840,000 14,517,883
GEORGIA-2.8%
Fulton County School District, Refunding 6.375%, 5/1/2016 ............... 5,900,000 6,414,480
Macon-Bibb County Industrial Authority, Industrial Revenue (Weyerhaeuser Co.
Project)
9%, 10/1/2007........................................................... 1,000,000 1,304,660
Monroe County Development Authority, PCR, Refunding
(Oglethorpe Power Corp., Scherer Project) 6.75%, 1/1/2010............... 4,000,000 4,423,760
GENERAL MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) AUGUST 31, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- -------------
GEORGIA (CONTINUED)
Municipal Electric Authority of Georgia, Special Obligation (Project One)
6.40%, 1/1/2013 (Insured; AMBAC)........................................ $ 7,500,000 $ 8,106,675
IDAHO-.5%
Idaho Housing Agency, Housing Revenue (Blue Meadows Project)
7.20%, 7/1/2033 (Insured; FHA).......................................... 3,500,000 3,603,915
ILLINOIS-7.0%
Chicago, Gas Supply Revenue (People's Gas Light and Coke Co. Project)
8.10%, 5/1/2020........................................................ 3,000,000 3,310,290
Chicago-O'Hare International Airport, Special Facility Revenue
(United Airlines Inc. Project):
8.40%, 5/1/2018........................................................ 2,805,000 3,049,372
8.50%, 5/1/2018........................................................ 2,500,000 2,753,900
8.85%, 5/1/2018........................................................ 6,355,000 7,219,471
Illinois Development Finance Authority, Revenue
(Community Rehabilitation Providers Facility Acquisition) 8.75%, 3/1/2010.. 2,130,000 2,268,407
Illinois Health Facilities Authority, Revenue:
(Beverly Farm Foundation) 9.125%, 12/15/2015 (Prerefunded 12/15/2000) (a).. 2,000,000 2,378,020
(Residential Centers Inc.) 8.50%, 8/15/2016.............................. 5,825,000 5,906,026
Robbins, RRR (Robbins Resource Recovery Partners) 9.25%, 10/15/2014.......... 14,750,000 14,713,125
Village of Romeoville 8.375%, 1/1/2010....................................... 7,495,000 8,361,722
INDIANA-2.6%
Fishers, Economic Development Revenue, First Mortgage (United Student Funds Inc.)
8.375%, 9/1/2014......................................................... 2,000,000 2,110,540
Indianapolis Airport Authority, Special Facility Revenue
(United Airlines Project) 6.50%, 11/15/2031.............................. 16,750,000 16,637,775
KENTUCKY-4.0%
Kenton County Airport Board, Airport Revenue
(Special Facilities - Delta Airlines Project):
7.50%, 2/1/2012........................................................ 11,550,000 12,307,680
7.125%, 2/1/2021....................................................... 4,630,000 4,808,070
City of Mount Sterling, Revenue (Kentucky League of Cities Funding Trust Lease
Program) 6.10%, 3/1/2018..................................................... 5,500,000 5,529,535
Pendleton County, Multi-County Lease Revenue (Kentucky Association of Counties
Leasing Trust Program) 6.40%, 3/1/2019.................................... 6,000,000 6,282,840
LOUISIANA-1.5%
Louisiana Public Facilities Authority, HR (Louisiana Association of Independent
Colleges and Universities Facilities Loan Program) 7%, 12/1/2017........... 6,195,000 6,545,389
GENERAL MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) AUGUST 31, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
--------------- ---------------
LOUISIANA (CONTINUED)
Parish of Saint James, SWDR (Freeport-McMoRan Partnership Project)
7.70%, 10/1/2022........................................................... $ 4,140,000 $ 4,207,896 MAINE-1.0%
Maine Finance Authority, SWDR (Boise Cascade Corp. Project) 7.90%, 6/1/2015. 6,900,000 7,450,344 MARYLAND-
1.8%
Maryland Community Development Administration, Department of Housing and
Community Development (Single Family Program) 6.55%, 4/1/2026............ 9,970,000 10,182,860
Montgomery County Housing Opportunities Commission, MFMR 7.375%, 7/1/2032.... 2,635,000 2,723,641
MASSACHUSETTS-1.2%
Massachusetts Health and Educational Facilities Authority, Revenue
(New England Deaconess Hospital Issue) 7.20%, 4/1/2022................... 5,070,000 5,399,297
Massachusetts Port Authority, Special Project Revenue (Harborside Hyatt Project)
10%, 3/1/2026............................................................ 3,000,000 3,355,080
MICHIGAN-6.6%
East Grand Rapids Public School District, Building and Site 5%, 5/1/2016..... 5,625,000 5,134,500
Michigan Hospital Finance Authority, HR, Refunding:
(Henry Ford Health System) 5.25%, 11/15/2025............................. 8,965,000 8,037,212
(Genesys Health System):
8.10%, 10/1/2013....................................................... 2,000,000 2,200,000
8.125%, 10/1/2021...................................................... 4,910,000 5,374,093
7.50%, 10/1/2027....................................................... 8,000,000 8,335,760
Michigan Strategic Fund, SWDR, Refunding (Genesee Power Station Project)
7.50%, 1/1/2021.......................................................... 7,000,000 6,858,040
Romulus Economic Development Corp., Economic Development Revenue, Refunding
(HIR Limited Partnership Project)
7%, 11/1/2015 (Surety Bond; ITT Lyndon Property Co. Inc.)................ 5,000,000 5,554,100
Wayne Charter County, Special Airport Facilities Revenue, Refunding
(Northwest Airlines Inc.) 6.75%, 12/1/2015............................... 5,650,000 5,693,505
MINNESOTA-1.3%
Southern Minnesota Municipal Power Agency, Power Supply System Revenue
5%, 1/1/2013 (Insured; FGIC)............................................. 10,000,000 9,196,600
MISSISSIPPI-.7%
Clairborne County, PCR, Refunding (System Energy Resources Inc.)
7.30%, 5/1/2025.......................................................... 5,000,000 5,156,000
NEW HAMPSHIRE-3.2%
New Hampshire Higher Educational and Health Facilities Authority, Revenue
(Crotched Mountain Rehabilitation Center) 7.75%, 1/1/2020................ 2,200,000 2,373,228
GENERAL MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) AUGUST 31, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- --------------
NEW HAMPSHIRE (CONTINUED)
New Hampshire Housing Finance Authority, Single Family Residential Mortgage:
7.75%, 7/1/2023.......................................................... $ 6,520,000 $ 6,849,651
7.70%, 7/1/2029.......................................................... 4,115,000 4,322,725
New Hampshire Industrial Development Authority, PCR
(Public Service Company of New Hampshire Project) 7.65%, 5/1/2021........ 9,250,000 9,386,345
NEW JERSEY-2.5%
New Jersey Economic Development Authority, Solid Waste Disposal Facility Revenue
(Garden State Paper Co. Inc. Project) 7.125%, 4/1/2022 (Guaranteed; Media General,
Inc., LOC; Toronto-Dominion Bank) (b).................................... 4,500,000 4,760,550
New Jersey Educational Facilities Authority, Revenue:
Refunding (University of Medicine and Dentistry)
5.25%, 12/1/2013 (Insured; AMBAC)...................................... 6,265,000 6,000,492
(Trenton State College) 5.125%, 7/1/2024 (Insured; MBIA)................. 8,000,000 7,293,760
NEW YORK-10.8%
City of New York:
6.75%, 10/1/2006......................................................... 2,250,000 2,370,735
7.10%, 8/15/2007......................................................... 10,500,000 11,137,245
Refunding:
6.50%, 3/15/2006....................................................... 6,000,000 6,197,760
6%, 2/1/2011........................................................... 5,000,000 4,831,400
5.875%, 3/15/2013...................................................... 17,955,000 17,071,255
New York State Dormitory Authority, Revenue:
(Consolidated City University System) 5.75%, 7/1/2018.................... 6,500,000 6,193,005
(State University Educational Facilities) 7.50%, 5/15/2013............... 2,500,000 2,922,500
New York State Urban Development Corp., Revenue, Refunding (State Facilities)
5.60%, 4/4/2015.......................................................... 7,800,000 7,357,038
Triborough Bridge and Tunnel Authority, Revenues, General Purpose, Refunding
5.50%, 1/1/2017.......................................................... 20,000,000 19,461,600
NORTH DAKOTA-1.3%
North Dakota Housing Finance Agency, SFMR:
7.30%, 7/1/2024.......................................................... 4,210,000 4,355,666
7.75%, 7/1/2024 (Insured; MBIA)........................................... 4,600,000 4,805,436
OHIO-1.0%
Cleveland, Parking Facilities Improvement Revenue 8.10%, 9/15/2022........... 2,300,000 2,745,878
Cuyahoga County, HR, Refunding (University Hospitals Health System Project)
5.50%, 1/15/2018 (Insured; MBIA)......................................... 5,000,000 4,773,050
OKLAHOMA-4.1%
McGee Creek Authority, Water Revenue 6%, 1/1/2013 (Insured; MBIA)........... 6,025,000 6,336,432
GENERAL MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) AUGUST 31, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
--------------- --------------
OKLAHOMA (CONTINUED)
Trustees of the Tulsa Municipal Airport Trust, Revenue
(American Airlines Inc. Project):
7.375%, 12/1/2020 (Guaranteed; AMR Corp.)............................. $ 9,850,000 $ 10,376,975
7.60%, 12/1/2030....................................................... 12,000,000 12,797,400
PENNSYLVANIA-3.2%
Lehigh County General Purpose Authority, Revenue (Wiley House)
9.50%, 11/1/2016......................................................... 3,500,000 3,733,030
Montgomery County Higher Education and Health Authority, Revenue
(Northwestern Corp.) 8.50%, 6/1/2016..................................... 3,000,000 3,206,730
State of Pennsylvania 5%, 11/15/2012 (Insured; AMBAC)........................ 6,125,000 5,708,500
Pennsylvania Higher Educational Facilities Authority, Health Services Revenue
Refunding (University of Pennsylvania) 5.75%, 1/1/2012.................. 6,000,000 5,984,340
Schuykill County Industrial Development Authority, RRR
(Schuykill Energy Resources Inc.) 6.50%, 1/1/2010....................... 4,430,000 4,213,683
RHODE ISLAND-1.1%
Rhode Island Housing and Mortgage Finance Corp.:
(Homeownership E-1) 7.55%, 10/1/2022..................................... 4,305,000 4,527,095
(Rental Housing Program) 7.95%, 10/1/2020................................ 3,195,000 3,360,182
SOUTH CAROLINA-.6%
Georgetown County, HR, Refunding (Georgetown County Memorial Hospital)
7.25%, 11/1/2017 (Insured; AMBAC)........................................ 4,000,000 4,352,800
TEXAS-9.0%
Alliance Airport Authority Inc., Special Facilities Revenue
(American Airlines Inc. Project) 7%, 12/1/2011 (Guaranteed; AMR Corp.).. 10,000,000 10,756,900
Bell County Health Facilities Development Corp., Revenue
(Southern Healthcare-Southview) 10.50%, 3/1/2020 (Prerefunded 3/1/2000) (a) 2,885,000 3,459,634
Dallas - Fort Worth International Airport Facility Improvement Corp., Revenue
(Delta Airlines Inc.):
7.625%, 11/1/2021...................................................... 2,200,000 2,352,240
7.125%, 11/1/2026...................................................... 5,000,000 5,167,200
Dickens County, Lease Obligation (Jail and Detention Facility Project)
8.875%, 4/1/2005......................................................... 3,950,000 4,164,208
Gulf Coast Waste Disposal Authority, SWDR (Champion International Corp.Project)
7.25%, 4/1/2017.......................................................... 4,735,000 4,975,680
Harris County 5%, 10/1/2017.................................................. 6,000,000 5,376,300
Montgomery County Health Facilities Development Corp., Hospital Mortgage Revenue
(Woodlands Medical Center Project) 8.85%, 8/15/2014...................... 6,675,000 7,186,772
South Texas Community College District, 5.50%, 8/15/2018 (Insured; AMBAC).... 5,015,000 4,820,368
GENERAL MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) AUGUST 31, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
---------------- ---------------
TEXAS (CONTINUED)
Texas Public Finance Authority, Revenue 5%, 8/1/2016 (Insured; AMBAC)....... $ 5,095,000 $ 4,636,603
Texas Turnpike Authority, Dallas North Thruway Revenue
(President George Bush Turnpike) 5%, 1/1/2025 (Insured; FGIC)........... 8,820,000 7,804,465
University of Texas (University Revenues Financing System) 5%, 8/15/2016.... 4,510,000 4,088,992
UTAH-3.1%
Carbon County, SWDR, Refunding (Sunnyside Cogeneration Project) 9.25%, 7/1/2018 8,000,000 5,688,720
Murray City, HR, Refunding (IHC Health Services Inc.)
4.75%, 5/15/2020 (Insured; MBIA)......................................... 19,855,000 16,724,264
VIRGINIA-2.4%
Upper Occoquan Sewer Authority, Regional Sewer Revenue:
5.15%, 7/1/2020 (Insured; MBIA).......................................... 4,000,000 3,702,560
5%, 7/1/2025 (Insured; MBIA)............................................. 14,925,000 13,270,564
WASHINGTON-2.3%
Chelan County Public Utility District Number 001, Consolidated Revenue
(Chelan Hydroelectric) 7.50%, 7/1/2011.................................. 4,155,000 4,736,825
Washington Public Power Supply System, Revenue, Refunding
(Nuclear Project Number 3) 7.125%, 7/1/2016 (Insured; MBIA).............. 10,000,000 11,490,400
WEST VIRGINIA-1.0%
State of West Virginia 5.25%, 11/1/2026 (Insured; FGIC)..................... 7,550,000 6,966,008
---------------
TOTAL LONG-TERM MUNICIPAL INVESTMENTS
(cost $685,778,099)...................................................... $702,776,050
===============
SHORT-TERM MUNICIPAL INVESTMENTS-2.0%
FLORIDA-.6%
Broward County Housing Finance Authority, MFHR, VRDN (Sanctuary Apartments Project)
3.55% (Guaranteed; Westinghouse Credit Corp. , LOC; PNC Bank) (b,c)..... $ 3,000,000 $ 3,000,000
Manatee County, PCR, Refunding, VRDN (Florida Power and Light Co. Project)
3.75% (c)............................................................... 1,500,000 1,500,000
NEW YORK-1.0%
City of New York, VRDN 4% (LOC; Morgan Guaranty Trust Co.) (b,c)............ 7,000,000 7,000,000
PENNSYLVANIA-.4%
Pennsylvania Higher Education Assistance Agency, Student Loan Revenue, VRDN
3.55% (LOC; Student Loan Marketing Association) (b,c).................... 3,000,000 3,000,000
--------------
TOTAL SHORT-TERM MUNICIPAL INVESTMENTS
(cost $14,500,000)...................................................... $ 14,500,000
===============
TOTAL INVESTMENTS-100.0%
(cost $700,278,099)...................................................... $717,276,050
===============
</TABLE>
<TABLE>
<CAPTION>
GENERAL MUNICIPAL BOND FUND, INC.
SUMMARY OF ABBREVIATIONS
<S> <C> <S> <C>
AMBAC American Municipal Bond Assurance Corporation MBIA Municipal Bond Investors Assurance
COP Certificate of Particiption Insurance Corporation
FGIC Financial Guaranty Insurance Company MFHR Multi-Family Housing Revenue
FHA Federal Housing Administration MFMR Multi-Family Mortgage Revenue
FSA Financial Security Assurance PCR Pollution Control Revenue
HR Hospital Revenue RRR Resources Recovery Revenue
IDR Industrial Development Revenue SFMR Single Family Mortgage Revenue
LOC Letter of Credit SWDR Solid Waste Disposal Revenue
VRDN Variable Rate Demand Notes
</TABLE>
<TABLE>
<CAPTION>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
FITCH (D) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
- ----------- ---------- ------------------ --------------------
<S> <C> <S> <C>
AAA Aaa AAA 27.3%
AA Aa AA 17.7
A A A 10.7
BBB Baa BBB 27.2
BB Ba BB 3.3
F1 Mig1 SP1 1.0
Not Rated (e) Not Rated (e) Not Rated (e) 12.8
--------
100.0%
========
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Bonds which are prerefunded are collateralized by U.S. government
securities which are held in escrow and are used to pay principal and
interest on the municipal issue and to retire the bonds in full at the
earliest refunding date.
(b) Secured by letters of credit.
(c) Securities payable on demand.The interest rate, which is subject to
change, is based upon bank prime rates or an index
of market interest rates.
(d) Fitch currently provides creditworthiness information for a limited
number of investments.
(e) Securities which, while not rated by Fitch, Moody's and Standard and
Poor's, have been determined by the Manager to be of comparable quality
to those rated securities in which the Fund may invest.
See independent accountants' review report and notes to financial statments.
<TABLE>
<CAPTION>
GENERAL MUNICIPAL BOND FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES AUGUST 31, 1996 (UNAUDITED)
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $700,278,099)-see statement...................................... $717,276,050
Cash..................................................................... 658,422
Interest receivable...................................................... 13,098,829
Receivable for investment securities sold................................ 2,312,425
Receivable for subscriptions to Common Stock............................ 100
Prepaid expenses........................................................ 103,652
---------------
733,449,478
LIABILITIES:
Due to The Dreyfus Corporation and affiliates............................ $398,399
Due to Distributor....................................................... 133,963
Payable for Common Stock redeemed........................................ 354,289
Accrued expenses......................................................... 49,272 935,923
------- --------
NET ASSETS................................................................... $732,513,555
===============
REPRESENTED BY:
Paid-in capital......................................................... $721,635,027
Accumulated undistributed investment income-net......................... 110,480
Accumulated net realized (loss) on investments.......................... (6,229,903)
Accumulated net unrealized appreciation on investments-Note 3(b)........ 16,997,951
---------------
NET ASSETS at value applicable to 51,286,160 shares outstanding
(150 million shares of $.01 par value Common Stock authorized).......... $732,513,555
===============
NET ASSET VALUE, offering and redemption price per share
($732,513,555 / 51,286,160 shares)...................................... $14.28
=======
See independent accountants' review report and notes to financial statements.
GENERAL MUNICIPAL BOND FUND, INC.
STATEMENT OF OPERATIONS SIX MONTHS ENDED AUGUST 31, 1996 (UNAUDITED)
INVESTMENT INCOME:
INTEREST INCOME.......................................................... $ 26,087,766
EXPENSES:
Management fee-Note 2(a)............................................... $ 2,259,776
Shareholder servicing costs-Note 2(b).................................. 1,089,445
Registration fees...................................................... 78,957
Professional fees...................................................... 43,724
Custodian fees......................................................... 36,327
Prospectus and shareholders' reports-Note 2(b)......................... 25,556
Directors' fees and expenses-Note 2(c)................................. 21,649
Miscellaneous.......................................................... 24,851
--------------
TOTAL EXPENSES................................................... 3,580,285
---------------
INVESTMENT INCOME-NET............................................ 22,507,481
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS-Note 3:
Net realized (loss) on investments....................................... $(4,368,973)
Net realized (loss) on financial futures................................. (524,648)
--------------
NET REALIZED (LOSS).................................................... (4,893,621)
Net unrealized (depreciation) on investments [including ($1,563) net unrealized
(depreciation) on financial futures]................................... (18,965,310)
--------------
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS............... (23,858,931)
--------------
NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS...................... $ (1,351,450)
==============
See independent accountants' review report and notes to financial statements.
GENERAL MUNICIPAL BOND FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED SIX MONTHS ENDED
FEBRUARY 29, AUGUST 31, 1996
1996 (UNAUDITED)
----------------- ----------------
OPERATIONS:
Investment income-net.................................................... $ 49,321,896 $ 22,507,481
Net realized gain (loss) on investments.................................. 19,385,819 (4,893,621)
Net unrealized appreciation (depreciation) on investments for the period 22,685,253 (18,965,310)
----------------- ---------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS........ 91,392,968 (1,351,450)
----------------- ---------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net.................................................... (49,321,896) (22,397,001)
Net realized gain on investments......................................... (1,284,955) (14,473,552)
---------------- ---------------
TOTAL DIVIDENDS........................................................ (50,606,851) (36,870,553)
--------------- ---------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold............................................ 2,501,610,587 1,360,794,454
Dividends reinvested..................................................... 35,154,871 26,622,123
Cost of shares redeemed.................................................. (2,644,671,673) (1,483,837,695)
--------------- ---------------
(DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS............... (107,906,215) (96,421,118)
--------------- --------------
TOTAL (DECREASE) IN NET ASSETS..................................... (67,120,098) (134,643,121)
NET ASSETS:
Beginning of period...................................................... 934,276,774 867,156,676
--------------- --------------
End of period (including undistributed investment income-net of
$110,480 on August 31, 1996)........................................... $ 867,156,676 $ 732,513,555
================ ===============
SHARES SHARES
================ ===============
CAPITAL SHARE TRANSACTIONS:
Shares sold.............................................................. 168,963,391 93,778,102
Shares issued for dividends reinvested................................... 2,367,210 1,834,986
Shares redeemed.......................................................... (178,155,527) (102,154,110)
--------------- --------------
NET (DECREASE) IN SHARES OUTSTANDING................................... (6,824,926) (6,541,022)
=============== ===============
See independent accountants' review report and notes to financial statements.
</TABLE>
GENERAL MUNICIPAL BOND FUND, INC.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This
information has been derived from the Fund's financial statements.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEAR ENDED FEBRUARY, AUGUST 31, 1996
--------------------------------------------------------- ----------------------
PER SHARE DATA: 1992 1993 1994 1995 1996 (UNAUDITED)
--------- ---------- ---------- ---------- ---------- ----------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.. $14.02 $14.60 $15.74 $15.46 $14.45 $15.00
--------- ---------- ---------- ---------- ---------- ----------------------
INVESTMENT OPERATIONS:
Investment income-net................. 1.06 .97 .90 .86 .82 .40
Net realized and unrealized gain (loss)
on investments...................... .62 1.29 (.04) (.89) .57 (.46)
--------- ---------- ---------- ---------- ---------- ----------------------
TOTAL FROM INVESTMENT OPERATIONS.... 1.68 2.26 .86 (.03) 1.39 (.06)
--------- ---------- ---------- ---------- ---------- ----------------------
DISTRIBUTIONS:
Dividends from investment income-net.. (1.06) (.97) (.91) (.86) (.82) (.40)
Dividends from net realized gain
on investments...................... (.04) (.15) (.23) (.12) (.02) (.26)
Dividends in excess of net realized gain
on investments...................... - - - .00(1) - -
-------------------- ---------- ---------- ---------- ----------------------
TOTAL DISTRIBUTIONS................. (1.10) (1.12) (1.14) (.98) (.84) (.66)
--------- ---------- ---------- ---------- ---------- ----------------------
Net asset value, end of period........ $14.60 $15.74 $15.46 $14.45 $15.00 $14.28
========= ========== ========== ========== ========== ======================
TOTAL INVESTMENT RETURN................... 12.34% 16.13% 5.50% .07% 9.79% (.83%)(2)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets. .01% .41% .82% .87% .88% .87%(2)
Ratio of net investment income to
average net assets.................. 7.30% 6.46% 5.71% 5.99% 5.50% 5.48%(2)
Decrease reflected in above expense ratios due
to undertakings by the Manager....... .75% .35% .03% - - -
Portfolio Turnover Rate................ 38.15% 64.98% 59.19% 67.87% 114.78% 55.49%(3)
Net Assets, end of period (000's Omitted) $720,395 $1,238,291 $1,240,815 $934,277 $867,157 $732,514
(1) Amount represents less than $.01 per share.
(2) Annualized.
(3) Not annualized.
</TABLE>
See independent accountants' review report and notes to financial statements.
GENERAL MUNICIPAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
General Municipal Bond Fund, Inc. (the "Fund") is registered under the
Investment Company Act of 1940 ("Act") as a diversified open-end management
investment company. The Fund's investment objective is to maximize current
income exempt from Federal income tax to the extent consistent with the
preservation of capital. The Dreyfus Corporation ("Manager") serves as the
Fund's investment adviser. The Manager is a direct subsidiary of Mellon Bank,
N.A. Premier Mutual Fund Services, Inc. (the "Distributor") acts as the
distributor of the Fund's shares, which are sold to the public without a
sales load.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management
estimates and assumptions. Actual results could differ from those estimates.
(A) PORTFOLIO VALUATION: The Fund's investments (excluding options and
financial futures on municipal and U.S. treasury securities) are valued each
business day by an independent pricing service ("Service") approved by the
Board of Directors. Investments for which quoted bid prices are readily
available and are representative of the bid side of the market in the
judgment of the Service are valued at the mean between the quoted bid prices
(as obtained by the Service from dealers in such securities) and asked prices
(as calculated by the Service based upon its evaluation of the market for
such securities). Other investments (which constitute a majority of the
portfolio securities) are carried at fair value as determined by the Service,
based on methods which include consideration of: yields or prices of
municipal securities of comparable quality, coupon, maturity and type;
indications as to values from dealers; and general market conditions. Options
and financial futures on municipal and U.S. treasury securities are valued at
the last sales price on the securities exchange on which such securities are
primarily traded or at the last sales price on the national securities market
on each business day. Investments not listed on an exchange or the national
securities market, or securities for which there were no transactions, are
valued at the average of the most recent bid and asked prices. Bid price is
used when no asked price is available.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Interest
income, adjusted for amortization of premiums and original issue discounts on
investments, is earned from settlement date and recognized on the accrual
basis. Securities purchased or sold on a when-issued or delayed-delivery
basis may be settled a month or more after the trade date.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to
comply with the distribution requirements of the Internal Revenue Code. To
the extent that net realized capital gain can be offset by capital loss
carryovers, if any, it is the policy of the Fund not to distribute such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income and
excise taxes.
GENERAL MUNICIPAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .55 of 1% of the value
of the Fund's average daily net assets and is payable monthly. The Agreement
provides for an expense reimbursement from the Manager should the Fund's
aggregate expenses, exclusive of taxes, brokerage, interest on borrowings and
extraordinary expenses, exceed 11\2% of the value of the Fund's average daily
net assets for any full fiscal year. There was no expense reimbursement for
the six months ended August 31, 1996.
(B) Under a Service Plan (the "Plan") adopted pursuant to Rule 12b-1
under the Act, the Fund (a) reimburses the Distributor for payments to
certain Service Agents (a securities dealer, financial institution or other
industry professional) for distributing the Fund's shares and servicing
shareholder accounts ("Servicing") and (b) pays the Manager, Dreyfus Service
Corporation, a wholly-owned subsidiary of the Manager, and any affiliate of
either of them (collectively, "Dreyfus") for advertising and marketing
relating to the Fund and for Servicing, at an aggregate annual rate of .20 of
1% of the value of the Fund's average daily net assets. Both the Distributor
and Dreyfus may pay one or more Service Agents a fee in respect of the Fund's
shares owned by shareholders with whom the Service Agent has a Servicing
relationship or for whom the Service Agent is the dealer or holder of record.
Both the Distributor and Dreyfus determine the amounts, if any, to be paid to
Service Agents under the Plan and the basis on which such payments are made.
The fees payable under the Plan are payable without regard to actual expenses
incurred. The Plan also separately provides for the Fund to bear the costs of
preparing, printing and distributing certain of the Fund's prospectuses and
statements of additional information and costs associated with implementing
and operating the Plan, not to exceed the greater of $100,000 or .005 of 1%
of the value of the Fund's average daily net assets for any full fiscal year.
During the six months ended August 31, 1996, $822,350 was charged to the Fund
pursuant to the Plan.
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
the Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund. Such
compensation amounted to $180,790 during the six months ended August 31,
1996.
(C) Each director who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $4,500 and an attendance fee of $500
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 3-SECURITIES TRANSACTIONS:
(A) The aggregate amount of purchases and sales of investment securities,
excluding short-term securities, during the six months ended August 31, 1996,
amounted to $421,659,011 and $479,046,809, respectively.
The Fund may invest in financial futures contracts in order to gain
exposure to or protect against changes in the market. The Fund is exposed to
market risk as a result of changes in the value of the underlying financial
instruments. Investments in financial futures require the Fund to "mark to
market" on a daily basis, which reflects the change in the market value of
the contract at the close of each day's
GENERAL MUNICIPAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
trading. Accordingly, variation margin payments are received or made to
reflect daily unrealized gains or losses. When the contracts are closed, the
Fund recognizes a realized gain or loss. These investments require initial
margin deposits with a custodian, which consist of cash or cash equivalents,
up to approximately 10% of the contract amount. The amount of these deposits
is determined by the exchange or Board of Trade on which the contract is
traded and is subject to change. At August 31, 1996, there were no financial
futures contracts outstanding.
(B) At August 31, 1996, accumulated net unrealized appreciation on
investments was $16,997,951, consisting of $24,934,923 gross unrealized
appreciation and $7,936,972 gross unrealized depreciation.
At August 31, 1996, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
GENERAL MUNICIPAL BOND FUND, INC.
REVIEW REPORT OF ERNST & YOUNG LLP, INDEPENDENT ACCOUNTANTS
SHAREHOLDERS AND BOARD OF DIRECTORS
GENERAL MUNICIPAL BOND FUND, INC.
We have reviewed the accompanying statement of assets and liabilities of
General Municipal Bond Fund, Inc., including the statement of investments, as
of August 31, 1996, and the related statements of operations and changes in
net assets and financial highlights for the six month period ended August 31,
1996. These financial statements and financial highlights are the
responsibility of the Fund's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data, and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, which
will be performed for the full year with the objective of expressing an
opinion regarding the financial statements and financial highlights taken as
a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the interim financial statements and financial highlights
referred to above for them to be in conformity with generally accepted
accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the statement of changes in net assets for the year ended
February 29, 1996 and financial highlights for each of the five years in the
period ended February 29, 1996 and in our report dated March 29, 1996, we
expressed an unqualified opinion on such statement of changes in net assets
and financial highlights.
(Ernst & Young LLP)
New York, New York
October 7, 1996
(Dreyfus Lion D Logo)
GENERAL MUNICIPAL
BOND FUND, INC.
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 106SA968
(Dreyfus Logo)
General Municipal
Bond Fund, Inc.
Semi-Annual
Report
August 31, 1996
