-------------------------------
Semiannual Report June 30, 1997
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OPPENHEIMER
BOND FUND
[GRAPHIC OMITTED]
[LOGO]
OppenheimerFunds(SM)
THE RIGHT WAY TO INVEST
<PAGE>
Contents
3 President's Letter
4 Fund Performance
6 An Interview with the Fund's Managers
10 Statement of Investments
24 Statement of Assets & Liabilities
26 Statement of Operations
27 Statements of Changes in Net Assets
28 Financial Highlights
30 Notes to Financial Statements
39 Officers & Trustees
40 Information & Services
Report highlights
- --------------------------------------------------------------------------------
o Our mortgage holdings -- especially "private label" mortgages -- outperformed
the returns of the overall fixed-income market during the period.
o We raised the credit quality of the Fund by shifting some of the assets from
corporate bonds to the mortgage market.
o Broad diversification across corporate and government bonds helped reduce
portfolio volatility.
- -------------------------------
Total Returns
- -------------------------------
For the Period Ended 6/30/97(1)
Class A
6 months 1 year
- -------------------------------
3.70% 9.66%
- -------------------------------
Class B
6 months 1 year
- -------------------------------
3.41% 8.84%
- -------------------------------
Class C
6 months 1 year
- -------------------------------
3.40% 8.94%
- -------------------------------
Total returns include changes in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the periods shown.
In reviewing performance and rankings, please remember that past performance
does not guarantee future results. Investment return and principal value of an
investment in the Fund will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than the original cost.
1. Includes changes in net asset value per share without deducting any sales
charges. Such performance would have been lower if sales charges were taken into
account. Total returns for the six-month period are cumulative and are not
annualized.
2 Oppenheimer Bond Fund
<PAGE>
Dear shareholder,
- --------------------------------------------------------------------------------
[PHOTO]
James C. Swain
Chairman
Oppenheimer Bond Fund
[PHOTO]
Bridget A. Macaskill
President
Oppenheimer Bond Fund
We'd like to welcome you to the premier issue of our newly redesigned
shareholder reports. As you can see, we've changed the format to allow easier
access to the information you need to monitor your investments. Some notable
additions are "at-a-glance" report highlights and charts that let you quickly
assess how your Fund has performed. On the following pages, your portfolio team
discuss their current investment thinking, your Fund's strategies, and
performance. Before these commentaries, we'd like to share a few global
observations.
As we consider the world's financial markets over the past six months,
some global trends emerge. For example, inflation has hit its lowest level in
three decades worldwide, which has helped spur many bullish financial markets.
The United States has been a beneficiary of this low-inflation environment, as
well as of a strong dollar, robust corporate earnings and a healthy economy.
However, many financial analysts are now concerned that the United States has
reached a point in the business cycle where earnings could decline because
companies are unable to further reduce costs.
On the other hand, a wave of corporate restructuring throughout Europe has
resulted in some exciting changes and opportunities. Because a similar
restructuring took place in the United States ten years ago, European companies
have been able to enjoy the benefit of hindsight by following our footsteps.
Latin America, too, has begun to shift its economies more toward the U.S.
capitalist model and has reported positive earnings growth along the way.
With major changes occurring in today's economies around the globe, it's
more important than ever to maintain a diversified portfolio across different
countries and market sectors. Now is the time to speak to your financial adviser
to ensure that your assets are allocated properly, so you have the opportunity
to benefit from investments in both domestic and international funds. It's
important to remember that investing abroad can involve greater risk and
expenses--including political and economic uncertainties--and should be
undertaken with a long-term approach in mind.
To keep in touch with our views on the markets, visit our website,
www.oppenheimerfunds.com, where you can access your account information and fund
performance data, 24 hours a day. The site also features prospectuses, timely
market updates and insightful commentaries. Our new shareholder reports and
presence on the Internet are just two examples of our commitment to keeping you
well informed.
Thank you for your confidence in OppenheimerFunds, The Right Way to
Invest. We look forward to helping you reach your investment goals in the
future.
/s/ James C. Swain /s/ Bridget A. Macaskill
James C. Swain Bridget A. Macaskill
July 22, 1997
3 Oppenheimer Bond Fund
<PAGE>
Performance update
- --------------------------------------------------------------------------------
- -----------------------------
Avg Annual Total Returns
- -----------------------------
For the Period Ended 6/30/97(1)
Class A
Since
1 year 5 year Inception
- -----------------------------
4.45% 5.98% 7.68%
- -----------------------------
Class B
Since
1 year 5 year Inception
- -----------------------------
3.84% N/A 4.86%
- -----------------------------
Class C
Since
1 year 5 year Inception
- -----------------------------
7.94% N/A 5.72%
- -----------------------------
Oppenheimer Bond Fund has performed well. In fact, as of June 30, 1997 the
Fund's Class A shares were ranked #9 out of 123 Corporate Debt A Rated funds
ranked by Lipper Analytical Services for the one-year period ended 6/30/97.(2)
Growth of $10,000
Over five years (without sales charge)3
[GRAPHIC OMITTED]
[THE FOLLOWING TABLE WAS DEPICTED IN THE PRINTED MATERIALS AS A MOUNTAIN CHART]
Oppenheimer Lehman Brothers
Bond Fund Corporate Bond
Date Class A Shares Index
---- -------------- ---------------
6/30/92 $10,000.00 $10,000.00
9/30/92 $10,626.66 $10,472.28
12/31/92 $10,408.39 $10,492.83
3/31/93 $10,915.27 $11,022.82
6/30/93 $11,199.09 $11,391.26
9/30/93 $11,544.43 $11,787.19
12/93 $11,480.82 $11,769.45
3/94 $11,117.85 $11,354.99
6/94 $10,961.71 $11,176.36
9/94 $11,011.73 $11,258.38
12/94 $11,036.87 $11,307.56
3/95 $11,583.90 $11,977.26
6/95 $12,307.01 $12,868.12
9/95 $12,421.31 $13,171.37
12/95 $12,906.01 $13,821.80
3/96 $12,735.34 $13,465.11
6/96 $12,798.34 $13,625.26
9/96 $13,088.35 $13,795.34
12/96 $13,533.96 $14,275.47
3/97 $13,514.42 $14,131.55
6/30/97 $14,034.27 $14,714.48
Past performance does not guarantee future results.
1. Total returns include changes in share price and reinvestment of dividends
and capital gains distributions in a hypothetical investment for the periods
shown. Class A returns include the current maximum initial sales charge of
4.75%. Class A shares were first publicly offered on 4/15/88. The Fund's maximum
sales charge for Class A shares was lower prior to 3/29/91, so actual
performance may have been higher. Class B returns include the applicable
contingent deferred sales charge of 5% (1-year) and 2% (since inception on
5/1/93). Class C returns include the contingent deferred sales charge of 1% for
the 1-year result. Class C shares were first publicly offered on 7/11/95. An
explanation of the different performance calculations is in the Fund's
prospectus. Class B and C shares are subject to an annual 0.75% asset-based
sales charge.
2. Source: Lipper Analytical Services, Inc., 6/30/97. Based on the comparisons
between changes in net asset value without considering sales charges, with
dividends and capital gains distributions of the Fund's Class A shares
reinvested. The Fund's Class A shares were ranked 9 of 123 (1-year), 24 of 53
(5-year) and 21 of 30 (10-year) among Corporate Debt A Rated funds for the
period ended 6/30/97.
4 Oppenheimer Bond Fund
<PAGE>
Portfolio review
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Oppenheimer Bond Fund is for investors looking for solid income potential from a
fund emphasizing quality securities.
What We Look For
o Sectors of the market that offer relative value.
o Primarily investment-grade securities that may help reduce credit risk.
o High income potential from different types of government and corporate
securities.
U.S. Corporate Bonds Sector Breakdown
(Percentage of net assets)(4)
......................................................
Financial Services 12.5% Utilities 3.6%
......................................................
Manufacturing 6.1 Basic Industry 3.0
......................................................
Technology 5.6 Retail 1.5
......................................................
Energy 4.7 Transportation 1.5
......................................................
Consumer Related 4.0 Housing Related 0.9
......................................................
Media 3.6 Other 0.3
......................................................
3. Results of a hypothetical $10,000 investment on June 30, 1992. The Lehman
Brothers Corporate Bond Index is a broad-based unmanaged index of publicly
issued nonconvertible investment-grade corporate debt of U.S. issuers including
reinvestment of income, and cannot be purchased directly by investors.
4. As of 6/30/97. Holdings are subject to change.
5 Oppenheimer Bond Fund
<PAGE>
An interview with your Fund's managers
- --------------------------------------------------------------------------------
- ------------------
"The Fund
maintained
a large allocation
in mortgage-backed
securities..."
- ------------------
How did the Fund perform?
Oppenheimer Bond Fund's Class A shares were ranked 9 out of 123 funds by Lipper
Analytical Services for the one-year period ended June 30, 1997.(1) The Fund's
Class A shares delivered a six-month cumulative total return of 3.70%, and a
one-year average total return of 9.66%, without deducting sales charges for the
period ended 6/30/97.(2)
What factors have affected the Fund's performance?
The Fund has done well because our investments in mortgage-backed securities and
corporate bonds have generally outperformed U.S. Treasuries. And, because
interest rates rose slightly during the first half of the year, our
neutral-to-defensive duration posture resulted in good relative performance of
the Fund's Treasury position.(3)
In addition, we increased our mortgage holdings--especially "private
label" mortgages--which have substantially outperformed the returns of the
overall fixed-income market during the period. These "private label" mortgages
are secured by real estate collateral, but are not guaranteed by the U.S.
government. On the other hand, while the corporate sector reported excellent
performance, we reduced its position in the Fund due to deteriorating
valuations.
How are you positioning the Fund for today's economy?
Today, many analysts believe we may be nearing a peak in the economic cycle,
which may likely cause a shift in expectations about inflation and economic
growth. As this scenario unfolds, the Federal Reserve will most likely respond
to maintain its policy of a stable financial environment. Since we do not
anticipate a dramatic shift in interest rates in the near term, we are
maintaining a large allocation in mortgage-backed securities. That's because
these mortgages historically have outperformed U.S.
6 Oppenheimer Bond Fund
<PAGE>
[PHOTO]
Portfolio Management
Team (l to r)
David Negri
(Fund Manager)
David Rosenberg
Treasuries in spite of modest interest rate moves--either up or down.
Eventually in this cycle, we will reposition the Fund by shifting to
longer-duration U.S. government securities and by reducing credit risk in the
corporate sector of the portfolio.
How has the Fund changed recently?
In terms of interest rate risk, the Fund is still positioned neutrally. The
biggest change has been an even heavier weighting toward private label mortgage
securities, which now account for about 15% of the Fund's net assets. These
securities continue to have attractive valuations, especially when compared to
corporate bonds. In addition to generally being less sensitive to modest changes
in interest rates, both private and government-guaranteed mortgages historically
offer the benefit of earning higher yields than U.S. Treasuries.
What portions of the Fund have been underweighted?
Since year end we have further reduced our weighting in corporate bonds to
decrease credit risk in the portfolio. We are defensive on corporate bonds for
several reasons. First,
1. Source: Lipper Analytical Services, Inc., 6/30/97. Based on the comparisons
between changes in net asset value without considering sales charges, with
dividends and capital gains distributions of the Fund's Class A shares
reinvested. The Fund's Class A shares were ranked 9 of 123 (1- year), 24 of 53
(5-year), and 21 of 30 (10-year) among corporate debt funds for the period ended
6/30/97. Past performance does not guarantee future results.
2. Includes changes in net asset value per share without deducting any sales
charges. Such performance would have been lower if sales charges were taken into
account. Total returns for the six-month period are cumulative and are not
annualized. Past performance does not guarantee future results.
3. Duration measures interest-rate sensitivity; the longer the duration, the
greater the expected volatility as rates change.
7 Oppenheimer Bond Fund
<PAGE>
An interview with your Fund's managers
- --------------------------------------------------------------------------------
valuations are not extremely attractive since corporate bonds currently yield
little over U.S. Treasuries. And second, we view the business cycle as fairly
mature--possibly peaking in the next year. This means that corporate earnings
may not continue to rise as quickly as they have been, which would slow credit
improvement at many companies.
What is your outlook for the coming months?
Because of the reasons we've discussed here, we have positioned the Fund
defensively for several quarters. That is because we are waiting for the economy
to peak before becoming more aggressive on interest rate exposure. Ultimately,
we plan to increase the interest rate risk in the portfolio once the Federal
Reserve has adjusted its policy bias toward higher interest rates. However,
because wage costs--the harbinger of inflation--have not risen substantially,
even with rising employment, we are not looking to position the Fund more
aggressively at this time.
- -------------------
"...because they
historically
out perform
U.S. Treasuries
in spite of modest
interest rate
moves."
- -------------------
8 Oppenheimer Bond Fund
<PAGE>
Financials
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9 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments June 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
==========================================================================================================
<S> <C> <C>
Mortgage-Backed Obligations -- 62.0%
- ----------------------------------------------------------------------------------------------------------
Government Agency -- 46.8%
- ----------------------------------------------------------------------------------------------------------
FHLMC/FNMA/Sponsored -- 38.3%
Federal Home Loan Mortgage Corp.:
Certificates of Participation, 9%, 3/1/17 $ 488,886 $ 520,537
Certificates of Participation, Series 17-039, 13.50%, 11/1/10 53,434 62,971
Certificates of Participation, Series 17-094, 12.50%, 4/1/14 28,598 33,255
Collateralized Mtg. Obligations, Gtd. Multiclass Mtg. Participation
Certificates, Series 1343, Cl. LA, 8%, 8/15/22 1,600,000 1,665,437
Collateralized Mtg. Obligations, Gtd. Multiclass Mtg. Participation
Certificates, Series 151, Cl. F, 9%, 5/15/21 1,000,000 1,078,338
Collateralized Mtg. Obligations, Gtd. Multiclass Mtg. Participation
Certificates, Series 1712, Cl. B, 6%, 3/15/09 1,000,000 934,370
Collateralized Mtg. Obligations, Gtd. Multiclass Mtg. Participation
Certificates, Series 1714, Cl. M, 7%, 8/15/23 1,000,000 969,680
Gtd. Multiclass Mtg. Participation Certificates, Series 1460, Cl. H,
7%, 5/15/07 1,500,000 1,505,625
Gtd. Multiclass Mtg. Participation Certificates, Series G056, Cl. H,
9%, 7/20/24 2,493,000 2,648,812
Interest-Only Stripped Mtg.-Backed Security, Series 177, Cl. B,
10.279%-11.39%, 7/1/26(2) 21,418,816 7,640,494
- ----------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn.:
11%, 7/1/16 4,759,698 5,437,956
7%, 1/1/09-11/1/25 1,036,168 1,031,655
7%, 7/1/12-7/25/27(3) 6,460,000 6,427,733
7.50%, 2/1/08-3/1/08 655,399 667,685
7.50%, 7/25/12-7/1/27(3) 23,150,000 23,284,809
8%, 7/25/27(3) 9,500,000 9,710,805
Collateralized Mtg. Obligations, Gtd. Real Estate Mtg. Investment
Conduit Pass-Through Certificates, Series 1992-34, Cl. G, 8%, 3/25/22 540,000 561,427
Gtd. Mtg. Pass-Through Certificates, 8%, 8/1/17 567,048 580,470
Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates,
Trust 1991-170, Cl. E, 8%, 12/25/06 2,500,000 2,592,661
Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates,
Trust 1992-162, Cl. C, 7%, 10/25/21 8,400,000 8,213,604
Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates,
Trust 1992-169, Cl. L, 7%, 9/25/22 5,965,000 5,671,246
Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates,
Trust 1995-4, Cl. PC, 8%, 5/25/25 869,210 909,206
Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates,
Trust 1997-25, Cl. B, 7%, 12/18/22 510,000 499,373
Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates,
Trust 1997-27, Cl. J, 7.50%, 4/18/27 848,852 858,591
Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates,
Trust 1997-5, Cl. B, 7%, 9/18/17 1,648,000 1,618,168
</TABLE>
10 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
FHLMC/FNMA/Sponsored (continued)
Federal National Mortgage Assn.:
Interest-Only Stripped Mtg.-Backed Security, Trust 272, Cl. 2,
15.691%, 7/1/26(2) $ 1,393,158 $ 479,116
Principal-Only Stripped Mtg.-Backed Security, Series 267, Cl. 1,
5.283%, 10/1/24(4) 2,889,141 2,121,713
------------
87,725,737
- ----------------------------------------------------------------------------------------------------------
GNMA/Guaranteed--8.5%
Government National Mortgage Assn.:
10%, 11/15/09 281,549 310,769
10.50%, 12/15/17-5/15/21 266,767 296,131
11%, 10/20/19 1,091,834 1,234,111
12%, 1/15/99-5/15/14 16,915 17,712
13%, 12/15/14 27,600 32,560
6%, 7/20/27(3) 5,250,000 5,256,562
6.50%, 7/20/27(3) 3,200,000 3,237,000
7%, 7/15/09-7/20/25 1,975,659 2,023,317
7.50%, 7/1/27(3) 3,600,000 3,610,116
8%, 6/15/05-10/15/06 1,615,788 1,675,025
9%, 2/15/09-6/15/09 446,953 477,764
Collateralized Mtg. Obligations, Gtd. Real Estate Mtg. Investment
Conduit Pass-Through Certificates, Series 1994-5, Cl. PQ, 7.493%,
7/16/24 1,200,000 1,211,061
------------
19,382,128
- ----------------------------------------------------------------------------------------------------------
Private--15.2%
- ----------------------------------------------------------------------------------------------------------
Commercial--10.5%
Asset Securitization Corp., Commercial Mtg. Pass-Through Certificates:
Series 1996-D3, Cl. A5, 8.332%, 10/13/26(5)(6) 800,000 832,000
Series 1996-MD6, Cl. A5, 7.225%, 11/13/26(6) 2,000,000 2,005,937
Series 1997-D4, Cl. B1, 7.525%, 4/14/29(6) 333,000 312,240
Series 1997-D4, Cl. B2, 7.525%, 4/14/29(6) 333,000 304,487
Series 1997-D4, Cl. B3, 7.525%, 4/14/29(6) 334,000 296,582
Series 1997-MD7, Cl. A6, 8.243%, 1/13/30(6) 200,000 204,875
- ----------------------------------------------------------------------------------------------------------
Capital Lease Funding Securitization LP, Interest-Only Stripped
Mtg.-Backed Security, Series 1997-CTL1, 5.49%, 6/22/24(2)(5) 14,147,860 645,142
- ----------------------------------------------------------------------------------------------------------
CMC Securities Corp. I, Collateralized Mtg. Obligation, Series
1993-D, Cl. D-3, 10%, 7/25/23(5) 608,745 636,710
- ----------------------------------------------------------------------------------------------------------
Commercial Mortgage Acceptance Corp., Interest-Only Stripped Mtg.-
Backed Security, Series 1996-C1, Cl. X-2, 9.808%, 12/25/20(2)(5) 18,624,900 651,871
- ----------------------------------------------------------------------------------------------------------
FDIC Trust, Gtd. Real Estate Mtg. Investment Conduit
Pass-Through Certificates:
Series 1994-C1, Cl. 2-D, 8.70%, 9/25/25(5) 1,000,000 1,040,937
Series 1994-C1, Cl. 2-E, 8.70%, 9/25/25(5) 1,000,000 1,042,500
- ----------------------------------------------------------------------------------------------------------
Merrill Lynch Mortgage Investors, Inc., Mtg. Pass-Through
Certificates, Series 1996-C1, 7.42%, 4/25/28 1,500,000 1,509,258
</TABLE>
11 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments (Unaudited) (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Commercial (continued)
Morgan Stanley Capital I, Inc., Commercial Mtg. Pass-Through Certificates:
Series 1996-C1, Cl. D-1, 7.51%, 2/15/28(5)(6) $1,000,000 $ 1,007,500
Series 1996-C1, Cl. E, 7.51%, 2/15/28(5)(6) 1,100,000 1,007,875
- ----------------------------------------------------------------------------------------------------------
NationsCommercial Corp., NB Commercial Mtg. Pass-Through
Certificates, Series-DMC, Cl. B, 8.562%, 8/12/11(5) 3,000,000 3,058,945
- ----------------------------------------------------------------------------------------------------------
Potomac Gurnee Financial Corp., Commercial Mtg. Pass-Through
Certificates, Cl. D, 7.683%, 12/21/26(5) 1,500,000 1,508,910
- ----------------------------------------------------------------------------------------------------------
Resolution Trust Corp., Commercial Mtg. Pass-Through Certificates:
Series 1993-C1, Cl. B, 8.75%, 5/25/24 700,000 700,000
Series 1994-C1, Cl. C, 8%, 6/25/26 1,500,000 1,533,050
Series 1995-C1, Cl. D, 6.90%, 2/25/27 2,500,000 2,459,375
- ----------------------------------------------------------------------------------------------------------
Salomon Brothers Mortgage Securities VII, Series 1996-C1, Cl. E,
9.18%, 1/20/06 700,000 707,875
- ----------------------------------------------------------------------------------------------------------
Structured Asset Securities Corp., Multiclass Pass-Through
Certificates, Series 1996-C3, Cl. D, 8%, 6/25/30(5) 2,500,000 2,522,656
------------
23,988,725
- ----------------------------------------------------------------------------------------------------------
Manufactured Housing--0.1%
Green Tree Financial Corp., Series 1994-6, Cl. A3, 7.70%, 1/15/20 250,000 252,732
- ----------------------------------------------------------------------------------------------------------
Multi-Family--1.3%
Mortgage Capital Funding, Inc.:
Commercial Mtg. Pass-Through Certificates, Series 1997-MC1,
Cl. F, 7.452%, 5/20/07(5) 254,890 235,933
Multifamily Mtg. Pass-Through Certificates, Series 1996-MC1, Cl. G,
7.15%, 6/15/06(7) 2,250,000 2,066,484
- ----------------------------------------------------------------------------------------------------------
Resolution Trust Corp., Commercial Mtg. Pass-Through Certificates:
Series 1991-M5, Cl. A, 9%, 3/25/17 541,983 555,661
Series 1991-M6, Cl. B4, 7.089%, 6/25/21(6) 55,045 54,285
------------
2,912,363
- ----------------------------------------------------------------------------------------------------------
Other--0.8%
GE Capital Mortgage Services, Inc., Series 1994-14, Cl. A1, 6.50%,
4/25/24 72,468 72,219
- ----------------------------------------------------------------------------------------------------------
JHM Mtg. Acceptance Corp., Collateralized Mtg. Obligation Bonds,
Series E, Cl. 5, 8.96%, 4/1/19 1,596,472 1,668,809
- ----------------------------------------------------------------------------------------------------------
Salomon Brothers Mortgage Securities VI:
Interest-Only Stripped Mtg.-Backed Security, Series 1987-3, Cl. B,
12.50%, 10/23/17(2) 123,966 40,173
Principal-Only Stripped Mtg.-Backed Security, Series 1987-3, Cl. A,
Zero Coupon, 12.50%, 10/23/17(4) 181,414 124,891
------------
1,906,092
</TABLE>
12 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Residential--2.5%
CS First Boston Mortgage Securities Corp., Mtg. Pass-Through
Certificates:
Series 1997-C1, Cl. E, 7.50%, 6/20/29 $1,000,000 $ 995,469
Series 1997-C1, Cl. F, 7.50%, 6/20/29 150,000 139,195
Series 1997-C1, Cl. G, 7.50%, 6/20/29 150,000 133,664
Series 1997-C1, Cl. H, 7.50%, 6/20/29 210,000 154,613
- ----------------------------------------------------------------------------------------------------------
First Chicago/Lennar Trust 1, Commercial Mtg. Pass-Through Certificates:
Series 1997-CHL1, 8.13%, 2/25/11(6) 750,000 597,188
Series 1997-CHL1, 8.13%, 5/25/08(6) 750,000 722,578
- ----------------------------------------------------------------------------------------------------------
Morgan Stanley Capital I, Inc., Commercial Mtg. Pass-Through
Certificates, Series 1997-HF1, Cl. F, 6.86%, 7/15/29 225,000 201,656
- ----------------------------------------------------------------------------------------------------------
NationsBank Trust, Lease Pass-Through Certificates, Series
1997A-1, 7.442%, 1/10/11(6) 500,000 503,516
- ----------------------------------------------------------------------------------------------------------
Residential Funding Corp., Mtg. Pass-Through Certificates, Series
1993-S10, Cl. A9, 8.50%, 2/25/23 573,504 586,586
- ----------------------------------------------------------------------------------------------------------
Ryland Mortgage Securities Corp. III, Sub. Bonds, Series 1992-A,
Cl. 1A, 8.284%, 3/29/30(6) 363,828 364,966
- ----------------------------------------------------------------------------------------------------------
Salomon Brothers Mortgage Securities VII, Series 1996-B, Cl. 1, 7.136%,
4/25/26 1,977,170 1,324,704
------------
5,724,135
------------
Total Mortgage-Backed Obligations (Cost $139,620,843) 141,891,912
==========================================================================================================
U.S. Government Obligations--9.1%
- ----------------------------------------------------------------------------------------------------------
U.S. Treasury Bonds:
10.375%, 11/15/09(8) 1,000,000 1,215,626
11.625%, 11/15/04 2,375,000 3,076,368
12.75%, 11/15/10 1,000,000 1,388,126
8.75%, 5/15/20 4,273,000 5,186,358
8.875%, 8/15/17(9) 6,000,000 7,306,878
- ----------------------------------------------------------------------------------------------------------
U.S. Treasury Nts., 7.50%, 10/31/99 2,600,000 2,674,752
------------
Total U.S. Government Obligations (Cost $20,712,691) 20,848,108
==========================================================================================================
Foreign Government Obligations--0.4%
- ----------------------------------------------------------------------------------------------------------
International Bank for Reconstruction & Development Bonds,
12.50%, 7/25/97(5)NZD 800,000 544,894
- ----------------------------------------------------------------------------------------------------------
New Zealand (Government of) Bonds, 10%, 7/15/97NZD 390,000 264,515
------------
Total Foreign Government Obligations (Cost $770,253) 809,409
</TABLE>
13 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments (Unaudited) (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
==========================================================================================================
Corporate Bonds and Notes--47.3%
- ----------------------------------------------------------------------------------------------------------
Basic Industry--3.0%
- ----------------------------------------------------------------------------------------------------------
Chemicals--1.1%
FMC Corp., 8.75% Sr. Nts., 4/1/99 $ 250,000 $ 259,426
- ----------------------------------------------------------------------------------------------------------
Harris Chemical North America, Inc., 10.75% Gtd. Sr. Sub. Nts.,
10/15/03 100,000 102,500
- ----------------------------------------------------------------------------------------------------------
NL Industries, Inc.:
0%/13% Sr. Sec. Disc. Nts., 10/15/05(10) 50,000 47,562
11.75% Sr. Sec. Nts., 10/15/03 112,000 122,500
- ----------------------------------------------------------------------------------------------------------
Pioneer Americas Acquisition Corp., 9.25% Sr. Nts., 6/15/07(7) 200,000 198,000
- ----------------------------------------------------------------------------------------------------------
Quantum Chemical Corp., 10.375% First Mtg. Nts., 6/1/03 900,000 961,609
- ----------------------------------------------------------------------------------------------------------
Rohm & Haas Co., 9.50% Debs., 4/1/21 500,000 560,814
- ----------------------------------------------------------------------------------------------------------
Sterling Chemicals, Inc., 11.75% Sr. Unsec. Sub. Nts., 8/15/06 250,000 271,250
------------
2,523,661
- ----------------------------------------------------------------------------------------------------------
Containers--0.2%
IVEX Holdings Corp., 0%/13% Sr. Disc. Debs., Series B, 3/15/05(10) 200,000 162,000
- ----------------------------------------------------------------------------------------------------------
U.S. Can Corp., 10.125% Sr. Sub. Nts., 10/15/06 250,000 268,125
------------
430,125
- ----------------------------------------------------------------------------------------------------------
Metals/Mining--0.8%
Newmont Mining Corp., 8.625% Nts., 4/1/02 1,000,000 1,067,173
- ----------------------------------------------------------------------------------------------------------
Royal Oak Mines, Inc., 11% Sr. Sub. Nts., 8/15/06 900,000 864,000
------------
1,931,173
- ----------------------------------------------------------------------------------------------------------
Paper--0.7%
Gaylord Container Corp., 9.75% Sr. Nts., 6/15/07(7) 50,000 50,125
- ----------------------------------------------------------------------------------------------------------
Repap New Brunswick, Inc., 9.125% First Priority Sr. Sec. Nts., 7/15/00(6) 400,000 398,000
- ----------------------------------------------------------------------------------------------------------
Repap Wisconsin, Inc.:
9.25% First Priority Sr. Sec. Nts., 2/1/02 500,000 506,250
9.875% Second Priority Sr. Nts., 5/1/06 200,000 203,000
- ----------------------------------------------------------------------------------------------------------
Scotia Pacific Holding Co., 7.95% Timber Collateralized Nts., 7/20/15 425,218 428,093
------------
1,585,468
- ----------------------------------------------------------------------------------------------------------
Steel--0.2%
AK Steel Corp., 9.125% Sr. Nts., 12/15/06 350,000 361,375
- ----------------------------------------------------------------------------------------------------------
Consumer Related--4.0%
- ----------------------------------------------------------------------------------------------------------
Consumer Products--0.6%
TAG Heuer International SA, 12% Sr. Sub. Nts., 12/15/05 370,000 425,500
- ----------------------------------------------------------------------------------------------------------
Toro Co. (The), 11% Debs., 8/1/17 1,000,000 1,055,000
------------
1,480,500
</TABLE>
14 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Food/Beverages/Tobacco--0.3%
B.A.T. Capital Corp., 6.66% Medium-Term Nts., 3/22/00(7) $ 250,000 $ 248,892
- ----------------------------------------------------------------------------------------------------------
ConAgra, Inc., 9.75% Sr. Nts., 11/1/97 500,000 506,081
------------
754,973
- ----------------------------------------------------------------------------------------------------------
Healthcare--1.3%
Grace (W.R.) & Co., 7.25% Medium-Term Nts., 7/15/97 2,000,000 2,001,078
- ----------------------------------------------------------------------------------------------------------
HEALTHSOUTH Corp., 9.50% Sr. Sub. Nts., 4/1/01 500,000 527,500
- ----------------------------------------------------------------------------------------------------------
Imcera Group, Inc., 6% Nts., 10/15/03 500,000 476,565
------------
3,005,143
- ----------------------------------------------------------------------------------------------------------
Hotel/Gaming--0.6%
Grand Casinos, Inc., 10.125% Gtd. First Mtg. Nts., 12/1/03 100,000 104,750
- ----------------------------------------------------------------------------------------------------------
HMC Acquisition Properties, Inc., 9% Sr. Nts., Series B, 12/15/07 800,000 820,000
- ----------------------------------------------------------------------------------------------------------
Horseshoe Gaming LLC, 9.375% Sr. Sub. Nts., 6/15/07(7) 100,000 101,250
- ----------------------------------------------------------------------------------------------------------
Mohegan Tribal Gaming Authority, 13.50% Sr. Sec. Nts., Series B, 11/15/02 210,000 276,150
------------
1,302,150
- ----------------------------------------------------------------------------------------------------------
Restaurants--0.9%
Ameriking, Inc., 10.75% Sr. Nts., 12/1/06 160,000 167,600
- ----------------------------------------------------------------------------------------------------------
Foodmaker, Inc.:
9.25% Sr. Nts., 3/1/99 1,000,000 1,030,000
9.75% Sr. Sub. Nts., 6/1/02 750,000 779,062
------------
1,976,662
- ----------------------------------------------------------------------------------------------------------
Textile/Apparel--0.3%
CMI Industries, Inc., 9.50% Sr. Sub. Nts., 10/1/03(5) 40,000 40,500
- ----------------------------------------------------------------------------------------------------------
Fruit of the Loom, Inc., 7% Debs., 3/15/11 500,000 466,289
- ----------------------------------------------------------------------------------------------------------
William Carter Co., 10.375% Sr. Sub. Nts., 12/1/06 200,000 210,500
------------
717,289
- ----------------------------------------------------------------------------------------------------------
Energy--4.7%
- ----------------------------------------------------------------------------------------------------------
Belden & Blake Corp., 9.875% Sr. Sub. Nts., 6/15/07(7) 200,000 199,500
- ----------------------------------------------------------------------------------------------------------
Chesapeake Energy Corp., 12% Gtd. Sr. Exchangeable Nts., 3/1/01 675,000 718,875
- ----------------------------------------------------------------------------------------------------------
Coastal Corp., 8.75% Sr. Nts., 5/15/99 325,000 338,341
- ----------------------------------------------------------------------------------------------------------
Eastern Energy Ltd., 6.75% Nts., 12/1/06(7) 2,000,000 1,941,718
- ----------------------------------------------------------------------------------------------------------
J. Ray McDermott SA, 9.375% Sr. Sub. Bonds, 7/15/06 850,000 877,625
- ----------------------------------------------------------------------------------------------------------
Mariner Energy, Inc., 10.50% Sr. Sub. Nts., 8/1/06 500,000 522,500
- ----------------------------------------------------------------------------------------------------------
McDermott, Inc., 9.375% Nts., 3/15/02 100,000 104,503
- ----------------------------------------------------------------------------------------------------------
Mesa Operating Co., 10.625% Gtd. Sr. Sub. Nts., 7/1/06 740,000 845,450
- ----------------------------------------------------------------------------------------------------------
Occidental Petroleum Corp., 11.125% Sr. Debs., 6/1/19 2,000,000 2,266,728
- ----------------------------------------------------------------------------------------------------------
Petroleum Heat & Power Co., Inc., 9.375% Sub. Debs., 2/1/06 750,000 716,250
</TABLE>
15 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments (Unaudited) (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Energy (continued)
Phillips Petroleum Co., 7.53% Pass-Through Certificates,
Series 1994-A1, 9/27/98 $ 269,513 $ 272,095
- ----------------------------------------------------------------------------------------------------------
TransCanada PipeLines Ltd., 9.875% Debs., 1/1/21 1,500,000 1,848,930
- ----------------------------------------------------------------------------------------------------------
Wiser Oil Co., 9.50% Sr. Sub. Nts., 5/15/07(7) 100,000 100,500
------------
10,753,015
- ----------------------------------------------------------------------------------------------------------
Financial Services--12.5%
- ----------------------------------------------------------------------------------------------------------
Banks & Thrifts--2.6%
BankAmerica Institute, 8.07% Gtd. Bonds, Series A, 12/31/26(5) 1,000,000 1,002,165
- ----------------------------------------------------------------------------------------------------------
Banque Nationale de Paris, 9.875% Debs., 5/25/98 205,000 210,946
- ----------------------------------------------------------------------------------------------------------
Chase Manhattan Corp. (New), 6.625% Sr. Nts., 1/15/98 25,000 25,097
- ----------------------------------------------------------------------------------------------------------
Citicorp Capital I, 7.933% Gtd. Bonds, 2/15/27 1,000,000 1,000,202
- ----------------------------------------------------------------------------------------------------------
Deutsche Bank Financial, Inc., 6.70% Gtd. Nts., 12/13/06 1,000,000 973,350
- ----------------------------------------------------------------------------------------------------------
First Fidelity Bancorporation, 8.50% Sub. Capital Nts., 4/1/98 325,000 330,471
- ----------------------------------------------------------------------------------------------------------
First Nationwide Holdings, Inc.:
10.625% Sr. Sub. Nts., 10/1/03 500,000 555,000
9.125% Sr. Sub. Nts., 1/15/03 500,000 518,750
- ----------------------------------------------------------------------------------------------------------
National Westminster Bank plc, 9.375% Gtd. Capital Nts., 11/15/03 70,000 78,777
- ----------------------------------------------------------------------------------------------------------
Royal Bank of Scotland Group (The) plc, 10.125% Sub. Gtd.
Capital Nts., 3/1/04 500,000 575,936
- ----------------------------------------------------------------------------------------------------------
Shoshone Partners Trust, 8% Sr. Nts., 5/31/02(5)(6) 177,000 177,245
- ----------------------------------------------------------------------------------------------------------
Suntrust Banks, Inc., 8.875% Debs., 2/1/98 500,000 508,429
------------
5,956,368
- ----------------------------------------------------------------------------------------------------------
Diversified Financial--8.5%
Aames Financial Corp., 9.125% Sr. Nts., 11/1/03 400,000 410,000
- ----------------------------------------------------------------------------------------------------------
Associates Corp. of North America, 7.40% Medium-Term Nts., 7/7/99 300,000 305,427
- ----------------------------------------------------------------------------------------------------------
Beneficial Corp., 12.875% Debs., 8/1/13 20,000 22,288
- ----------------------------------------------------------------------------------------------------------
BHP Finance (USA) Ltd., 8.50% Gtd. Debs., 12/1/12 1,500,000 1,658,836
- ----------------------------------------------------------------------------------------------------------
Cityscape Financial Corp., 12.75% Sr. Nts., 6/1/04(7) 700,000 693,000
- ----------------------------------------------------------------------------------------------------------
Enterprise Rent-A-Car USA Finance Co., 7.875% Nts., 3/15/98(7) 1,500,000 1,517,685
- ----------------------------------------------------------------------------------------------------------
Ford Motor Credit Co.:
6.75% Nts., 8/15/08 1,000,000 966,193
9.90% Medium-Term Nts., 11/6/97 2,000,000 2,028,398
- ----------------------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc., 6.875% Nts., 3/1/03 750,000 752,047
- ----------------------------------------------------------------------------------------------------------
Midland American Capital Corp., 12.75% Gtd. Nts., 11/15/03 205,000 220,874
- ----------------------------------------------------------------------------------------------------------
NationsBank Corp., 10.20% Sub. Nts., 7/15/15 1,300,000 1,636,311
- ----------------------------------------------------------------------------------------------------------
Olympic Financial Ltd., Units (each unit consists of $1,000 principal
amount of 11.50% sr. nts., 3/15/07 and one warrant to purchase 6.84
shares of common stock)(11) 200,000 206,500
- ----------------------------------------------------------------------------------------------------------
Penske Truck Leasing Co. LP, 7.75% Sr. Nts., 5/15/99 1,825,000 1,872,410
</TABLE>
16 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Diversified Financial (continued)
Ryder System, Inc., 8.75% Debs., Series J, 3/15/17 $1,600,000 $ 1,634,221
- ----------------------------------------------------------------------------------------------------------
Salomon, Inc., 7.30% Nts., 5/15/02 1,000,000 1,008,031
- ----------------------------------------------------------------------------------------------------------
Saul (B.F.) Real Estate Investment Trust, 11.625% Sr. Sec.
Nts., Series B, 4/1/02 1,125,000 1,198,125
- ----------------------------------------------------------------------------------------------------------
Source One Mortgage Services Corp., 9% Debs., 6/1/12 1,250,000 1,306,965
- ----------------------------------------------------------------------------------------------------------
Washington Mutual Capital I, 8.375% Gtd. Bonds, 6/1/27 2,000,000 2,031,834
------------
19,469,145
- ----------------------------------------------------------------------------------------------------------
Insurance--1.4%
Aetna Services, Inc., 8% Debs., 1/15/17 1,000,000 995,325
- ----------------------------------------------------------------------------------------------------------
Allmerica Capital I, 8.207% Debs., 2/3/27(7) 2,000,000 2,019,166
- ----------------------------------------------------------------------------------------------------------
Veritas Holdings, Inc., 9.625% Sr. Nts., 12/15/03(7) 200,000 207,000
------------
3,221,491
- ----------------------------------------------------------------------------------------------------------
Housing Related--0.9%
- ----------------------------------------------------------------------------------------------------------
Building Materials--0.1%
Building Materials Corp. of America, 8.625% Sr. Nts., 12/15/06 50,000 51,000
- ----------------------------------------------------------------------------------------------------------
Falcon Building Products, Inc., 9.50% Sr. Sub. Nts., 6/15/07(7) 100,000 100,000
------------
151,000
- ----------------------------------------------------------------------------------------------------------
Homebuilders/Real Estate--0.8%
Continental Homes Holding Corp., 10% Gtd. Unsec. Bonds, 4/15/06 50,000 51,750
- ----------------------------------------------------------------------------------------------------------
Greystone Homes, Inc., 10.75% Sr. Nts., 3/1/04 50,000 54,250
- ----------------------------------------------------------------------------------------------------------
Standard Pacific Corp., 8.50% Sr. Nts., 6/15/07 235,000 235,588
- ----------------------------------------------------------------------------------------------------------
Trizec Hahn Corp., 7.95% Sr. Unsec. Debs., 6/1/07CAD 2,000,000 1,492,724
- ----------------------------------------------------------------------------------------------------------
U.S. Home Corp., 9.75% Sr. Nts., 6/15/03 100,000 104,500
------------
1,938,812
- ----------------------------------------------------------------------------------------------------------
Manufacturing--6.1%
- ----------------------------------------------------------------------------------------------------------
Aerospace--2.0%
Atlas Air, Inc., 12.25% Pass-Through Certificates, 12/1/02(5) 1,000,000 1,110,000
- ----------------------------------------------------------------------------------------------------------
Boeing Co., 7.50% Debs., 8/15/42 2,000,000 2,028,398
- ----------------------------------------------------------------------------------------------------------
Rolls-Royce Capital, Inc., 7.125% Gtd. Nts., 7/29/03 1,000,000 1,008,750
- ----------------------------------------------------------------------------------------------------------
Southwest Airlines Co., 9.25% Debs., 2/15/98 500,000 509,620
------------
4,656,768
- ----------------------------------------------------------------------------------------------------------
Automotive--1.4%
Chrysler Corp., 10.95% Debs., 8/1/17 200,000 212,063
- ----------------------------------------------------------------------------------------------------------
Ford Motor Co., 8.875% Debs., 11/15/22 2,000,000 2,187,136
- ----------------------------------------------------------------------------------------------------------
Hayes Wheels International, Inc., 11% Sr. Sub. Nts., 7/15/06 200,000 220,500
- ----------------------------------------------------------------------------------------------------------
Johnson Controls, Inc., 7.70% Debs., 3/1/15 500,000 522,518
------------
3,142,217
</TABLE>
17 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments (Unaudited) (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Capital Goods--2.7%
Caterpillar, Inc., 9.75% Debs., 6/1/19 $1,750,000 $1,898,097
- ----------------------------------------------------------------------------------------------------------
Clark-Schwebel, Inc., 10.50% Sr. Nts., 4/15/06 650,000 695,500
- ----------------------------------------------------------------------------------------------------------
Communications & Power Industries, Inc., 12% Sr. Sub. Nts.,
Series B, 8/1/05 500,000 545,000
- ----------------------------------------------------------------------------------------------------------
Mettler Toledo, Inc., 9.75% Gtd. Sr. Sub. Nts., 10/1/06 500,000 527,500
- ----------------------------------------------------------------------------------------------------------
Synthetic Industries, Inc., 9.25% Sr. Sub. Nts., 2/15/07(7) 50,000 51,250
- ----------------------------------------------------------------------------------------------------------
Thomas & Betts Corp., 8.25% Sr. Nts., 1/15/04 1,000,000 1,063,093
- ----------------------------------------------------------------------------------------------------------
Titan Wheel International, Inc., 8.75% Sr. Sub. Nts., 4/1/07 250,000 256,250
- ----------------------------------------------------------------------------------------------------------
Westinghouse Electric Corp., 8.375% Nts., 6/15/02 1,000,000 1,035,994
------------
6,072,684
- ----------------------------------------------------------------------------------------------------------
Media--3.6%
- ----------------------------------------------------------------------------------------------------------
Broadcasting--1.5%
Allbritton Communications Co., 11.50% Sr. Sub. Debs., 8/15/04 675,000 712,125
- ----------------------------------------------------------------------------------------------------------
American Radio Systems Corp., 9% Sr. Sub. Nts., 2/1/06 700,000 712,250
- ----------------------------------------------------------------------------------------------------------
Argyle Television, Inc., 9.75% Sr. Sub. Nts., 11/1/05 750,000 787,500
- ----------------------------------------------------------------------------------------------------------
Paxson Communications Corp., 11.625% Sr. Sub. Nts., 10/1/02 520,000 565,500
- ----------------------------------------------------------------------------------------------------------
Sinclair Broadcast Group, Inc.:
10% Sr. Sub. Nts., 9/30/05 200,000 207,000
9% Sr. Sub. Nts., 7/15/07(7) 100,000 97,125
- ----------------------------------------------------------------------------------------------------------
Young Broadcasting, Inc., 9% Sr. Sub. Nts., Series B, 1/15/06 400,000 394,000
------------
3,475,500
- ----------------------------------------------------------------------------------------------------------
Cable Television--1.6%
Cablevision Industries Corp., 9.25% Sr. Debs., Series B, 4/1/08 500,000 539,494
- ----------------------------------------------------------------------------------------------------------
EchoStar Communications Corp., 0%/12.875% Sr. Disc. Nts., 6/1/04(10) 250,000 211,250
- ----------------------------------------------------------------------------------------------------------
EchoStar DBS Corp., 12.50% Gtd. Nts., 7/1/02(7) 300,000 298,500
- ----------------------------------------------------------------------------------------------------------
Panamsat LP/Panamsat Capital Corp., 0%/11.375% Sr. Sub. Disc. Nts.,
8/1/03(10) 1,500,000 1,460,625
- ----------------------------------------------------------------------------------------------------------
TKR Cable I, Inc., 10.50% Sr. Debs., 10/30/07 1,000,000 1,100,687
------------
3,610,556
- ----------------------------------------------------------------------------------------------------------
Diversified Media--0.4%
Heritage Media Corp., 8.75% Sr. Sub. Nts., 2/15/06 500,000 517,500
- ----------------------------------------------------------------------------------------------------------
Lamar Advertising Co., 9.625% Sr. Sub. Nts., 12/1/06 150,000 154,500
- ----------------------------------------------------------------------------------------------------------
Outdoor Systems, Inc., 8.875% Sr. Sub. Nts., 6/15/07(7) 200,000 195,250
------------
867,250
- ----------------------------------------------------------------------------------------------------------
Entertainment/Film--0.1%
Blockbuster Entertainment Corp., 6.625% Sr. Nts., 2/15/98 250,000 250,555
- ----------------------------------------------------------------------------------------------------------
Other--0.3%
- ----------------------------------------------------------------------------------------------------------
Services--0.3%
Archer Daniels Midland Co., 7.125% Debs., 3/1/13 750,000 758,350
</TABLE>
18 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Retail--1.5%
- ----------------------------------------------------------------------------------------------------------
Department Stores--0.3%
Sears Canada, Inc., 11.70% Debs., 7/10/00CAD $ 500,000 $ 420,573
- ----------------------------------------------------------------------------------------------------------
Sears Roebuck & Co., 8.39% Medium-Term Nts., 3/23/99 300,000 309,921
------------
730,494
- ----------------------------------------------------------------------------------------------------------
Specialty Retailing--0.3%
May Department Stores Cos., 10.625% Debs., 11/1/10 405,000 520,947
- ----------------------------------------------------------------------------------------------------------
Specialty Retailers, Inc., 9% Gtd. Sr. Sub. Nts., 7/15/07(7) 100,000 101,000
------------
621,947
- ----------------------------------------------------------------------------------------------------------
Supermarkets--0.9%
Jitney-Jungle Stores of America, Inc., 12% Gtd. Sr. Nts., 3/1/06 100,000 111,875
- ----------------------------------------------------------------------------------------------------------
Kroger Co., 8.50% Sr. Sec. Debs., 6/15/03 1,000,000 1,049,586
- ----------------------------------------------------------------------------------------------------------
Ralph's Grocery Co. (New):
11% Sr. Sub. Nts., 6/15/05(7) 200,000 218,000
10.45% Sr. Nts., 6/15/04 200,000 215,750
10.45% Sr. Nts., 6/15/04 300,000 323,625
- ----------------------------------------------------------------------------------------------------------
Randall's Food Markets, 9.375% Sr. Sub. Nts., 7/1/07(7) 200,000 199,000
------------
2,117,836
- ----------------------------------------------------------------------------------------------------------
Technology--5.6%
- ----------------------------------------------------------------------------------------------------------
Information Technology--3.3%
Cellular Communications International, Inc., Zero Coupon Sr.
Disc. Nts., 11.23%, 8/15/00(12) 2,150,000 1,650,125
- ----------------------------------------------------------------------------------------------------------
Dyncorp, Inc., 9.50% Sr. Sub. Nts., 3/1/07(7) 250,000 253,125
- ----------------------------------------------------------------------------------------------------------
General Electric Capital Corp., 8.75% Debs., 5/21/07(9) 1,000,000 1,125,740
- ----------------------------------------------------------------------------------------------------------
Globalstar LP/Globalstar Capital Corp., 11.25% Sr. Nts., 6/15/04(7) 105,000 98,963
- ----------------------------------------------------------------------------------------------------------
Metrocall, Inc., 10.375% Sr. Sub. Nts., 10/1/07 100,000 92,000
- ----------------------------------------------------------------------------------------------------------
Omnipoint Corp., 11.625% Sr. Nts., 8/15/06 500,000 482,500
- ----------------------------------------------------------------------------------------------------------
ORBCOMM Global LP/ORBCOMM Capital Corp., 14% Sr. Nts., 8/15/04 740,000 751,100
- ----------------------------------------------------------------------------------------------------------
PriCellular Wireless Corp.:
0%/12.25% Sr. Sub. Disc. Nts., 10/1/03(10) 200,000 189,000
0%/14% Sr. Sub. Disc. Nts., 11/15/01(10) 1,050,000 1,107,750
10.75% Sr. Nts., 11/1/04 125,000 131,875
- ----------------------------------------------------------------------------------------------------------
Real Time Data, Inc., Units (each unit consists of $1,000 principal
amount of 0%/13.50% sub. disc. nts., 8/15/06 and one warrant to
purchase six ordinary shares)(5)(10)(11) 1,000,000 570,000
- ----------------------------------------------------------------------------------------------------------
Tracor, Inc., 8.50% Sr. Sub. Nts., 3/1/07 200,000 202,500
- ----------------------------------------------------------------------------------------------------------
Unisys Corp., 11.75% Sr. Nts., 10/15/04 300,000 325,500
- ----------------------------------------------------------------------------------------------------------
USA Mobile Communications, Inc. II, 9.50% Sr. Nts., 2/1/04 500,000 470,000
------------
7,450,178
</TABLE>
19 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments (Unaudited) (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Telecommunications-Technology--2.3%
American Communications Services, Inc., 0%/12.75% Sr.
Disc. Nts., 4/1/06(10) $ 260,000 $ 143,000
- ----------------------------------------------------------------------------------------------------------
Bell Cablemedia plc, 0%/11.875% Sr. Disc. Nts., 9/15/05(10) 700,000 588,000
- ----------------------------------------------------------------------------------------------------------
Brooks Fiber Properties, Inc., 0%/11.875% Sr. Disc. Nts., 11/1/06(10) 300,000 196,500
- ----------------------------------------------------------------------------------------------------------
Colt Telecom Group plc, Units (each unit consists of $1,000 principal
amount of 0%/12% sr. disc. nts., 12/15/06 and one warrant to purchase
7.8 ordinary shares)(10)(11) 300,000 196,500
- ----------------------------------------------------------------------------------------------------------
Diamond Cable Communications plc, 0%/11.75% Sr. Disc. Nts.,
12/15/05(10) 650,000 442,000
- ----------------------------------------------------------------------------------------------------------
GST Telecommunications, Inc., 0%/13.875% Cv. Sr. Sub. Disc. Nts.,
12/15/05(7)(10) 100,000 59,625
- ----------------------------------------------------------------------------------------------------------
GST USA, Inc., 0%/13.875% Bonds, 12/15/05(10) 305,000 189,863
- ----------------------------------------------------------------------------------------------------------
ICG Holdings, Inc., 0%/13.50% Sr. Disc. Nts., 9/15/05(10) 625,000 450,000
- ----------------------------------------------------------------------------------------------------------
McLeod, Inc., 0%/10.50% Sr. Disc. Nts., 3/1/07(7)(10) 240,000 154,200
- ----------------------------------------------------------------------------------------------------------
MFS Communications Co., Inc.:
0%/8.875% Sr. Disc. Nts., 1/15/06(10) 700,000 556,500
0%/9.375% Sr. Disc. Nts., 1/15/04(10) 100,000 93,500
- ----------------------------------------------------------------------------------------------------------
NTL, Inc., 10% Sr. Nts., 2/15/07(7) 100,000 102,250
- ----------------------------------------------------------------------------------------------------------
Pacific Bell, 8.50% Debs., 8/15/31 1,000,000 1,058,229
- ----------------------------------------------------------------------------------------------------------
Teleport Communications Group, Inc.:
0%/11.125% Sr. Disc. Nts., 7/1/07(10) 150,000 108,563
9.875% Sr. Nts., 7/1/06 700,000 749,000
- ----------------------------------------------------------------------------------------------------------
Telewest Communications plc, 0%/11% Sr. Disc. Debs., 10/1/07(10) 100,000 72,500
------------
5,160,230
- ----------------------------------------------------------------------------------------------------------
Transportation--1.5%
- ----------------------------------------------------------------------------------------------------------
Railroads--1.3%
Canadian Pacific Ltd., 9.45% Debs., 8/1/21 1,000,000 1,182,250
- ----------------------------------------------------------------------------------------------------------
Kansas City Southern Industries, Inc., 6.625% Nts., 3/1/05 750,000 730,101
- ----------------------------------------------------------------------------------------------------------
Transtar Holdings LP/Transtar Capital Corp., 0%/13.375% Sr. Disc. Nts.,
Series B, 12/15/03(10) 1,100,000 929,500
- ----------------------------------------------------------------------------------------------------------
Union Pacific Corp., 9.65% Medium-Term Nts., 4/17/00 100,000 107,317
------------
2,949,168
- ----------------------------------------------------------------------------------------------------------
Trucking--0.2%
Coach USA, Inc., 9.375% Gtd. Sr. Sub. Nts., 7/1/07(7) 300,000 298,500
- ----------------------------------------------------------------------------------------------------------
Western Star Truck Holdings Ltd., 8.75% Sr. Nts., 5/1/07(7) 250,000 257,500
------------
556,000
</TABLE>
20 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Market Value
Amount(1) See Note 1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Utilities--3.6%
- ----------------------------------------------------------------------------------------------------------
Electric Utilities--1.2%
CalEnergy, Inc., 9.50% Sr. Nts., 9/15/06 $ 250,000 $ 268,125
- ----------------------------------------------------------------------------------------------------------
California Energy, Inc., 10.25% Sr. Disc. Nts., 1/15/04 600,000 649,500
- ----------------------------------------------------------------------------------------------------------
Calpine Corp., 10.50% Sr. Nts., 5/15/06 400,000 436,000
- ----------------------------------------------------------------------------------------------------------
Consumers Energy Co., 8.75% First Mtg. Nts., 2/15/98 250,000 253,374
- ----------------------------------------------------------------------------------------------------------
First PV Funding Corp.:
10.15% Lease Obligation Bonds, Series 1986B, 1/15/16 197,000 210,051
10.15% Lease Obligation Bonds, Series 1986B, 1/15/16 3,000 3,000
- ----------------------------------------------------------------------------------------------------------
Panda Global Energy Co., 12.50% Sr. Nts., 4/15/04(7) 175,000 171,500
- ----------------------------------------------------------------------------------------------------------
Public Service Co. of Colorado, 8.75% First Mtg. Bonds, 3/1/22 250,000 266,399
- ----------------------------------------------------------------------------------------------------------
South Carolina Electric & Gas Co., 9% Mtg. Bonds, 7/15/06 500,000 561,502
------------
2,819,451
- ----------------------------------------------------------------------------------------------------------
Gas Utilities--1.1%
Florida Gas Transmission Environmental Corp., 7.75% Sr. Nts., 11/1/97(7) 500,000 502,766
- ----------------------------------------------------------------------------------------------------------
Laclede Gas Co., 8.50% First Mtg. Bonds, 11/15/04 500,000 539,991
- ----------------------------------------------------------------------------------------------------------
National Fuel Gas Co., 7.75% Debs., 2/1/04 500,000 516,622
- ----------------------------------------------------------------------------------------------------------
Texas Gas Transmission Corp., 8.625% Nts., 4/1/04 500,000 542,011
- ----------------------------------------------------------------------------------------------------------
Union Gas Ltd., 13% Debs., 6/30/03CAD 518,000 404,639
------------
2,506,029
- ----------------------------------------------------------------------------------------------------------
Telephone Utilities--1.3%
GTE Corp., 8.85% Debs., 3/1/98 300,000 305,437
- ----------------------------------------------------------------------------------------------------------
New York Telephone Co., 9.375% Debs., 7/15/31 2,500,000 2,784,845
------------
3,090,282
------------
Total Corporate Bonds and Notes (Cost $105,724,662) 108,393,845
<CAPTION>
Shares
==========================================================================================================
<S> <C> <C>
Preferred Stocks--1.6%
- ----------------------------------------------------------------------------------------------------------
Allstate Financing I, 7.95% Gtd. Quarterly Income Preferred Securities,
Series A 80,000 2,000,000
- ----------------------------------------------------------------------------------------------------------
CRIIMI MAE, Inc., 10.875% Cum. Cv. Preferred Stock, Series B 23,000 830,875
- ----------------------------------------------------------------------------------------------------------
Fresenius Medical Care Trust, 9% Preferred Securities 605,000 629,200
- ----------------------------------------------------------------------------------------------------------
NEXTLINK Communications, Inc., 14% Sr. Exchangeable Preferred(13)(14) 3,157 166,532
------------
Total Preferred Stocks (Cost $3,339,070) 3,626,607
==========================================================================================================
Other Securities--0.2%
- ----------------------------------------------------------------------------------------------------------
WorldCom, Inc., 8% Cv. Depositary Shares each Representing 1/100
Share of Dividend Enhanced Convertible Stock (Cost $348,310) 5,000 563,750
</TABLE>
21 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments (Unaudited) (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Market Value
Units See Note 1
==========================================================================================================
<S> <C> <C>
Rights, Warrants and Certificates--0.0%
- ----------------------------------------------------------------------------------------------------------
American Communications Services, Inc. Wts., Exp. 11/05(5) 300 $ 15,000
- ----------------------------------------------------------------------------------------------------------
Cellular Communications International, Inc. Wts., Exp. 8/03(5) 500 7,500
- ----------------------------------------------------------------------------------------------------------
ICG Communications, Inc. Wts., Exp. 9/05(5) 1,980 15,840
- ----------------------------------------------------------------------------------------------------------
NEXTLINK Communications, Inc. Wts., Exp. 2/09(5) 3,050 30
------------
Total Rights, Warrants and Certificates (Cost $0) 38,370
Face Amount(1)
==========================================================================================================
Structured Instruments--0.3%
- ----------------------------------------------------------------------------------------------------------
Daiwa Finance Corp. (New York), Daiwa Physical Commodity Excess
Return Index Linked Nts., 4.719%, 8/21/97(6) (Cost $700,000) $700,000 612,430
Date Strike Contracts
==========================================================================================================
Call Options Purchased--0.0%
- ----------------------------------------------------------------------------------------------------------
U.S. Treasury Nts., 6.625%, 5/15/07
Call Opt. (Cost $49,971) 9/97 100.56% 4,250 41,836
==========================================================================================================
Put Options Purchased--0.0%
- ----------------------------------------------------------------------------------------------------------
U.S. Treasury Nts., 30-Yr. Futures, 9/97
Put Opt. (Cost $55,553) 8/97 108.00% 40 14,375
- ----------------------------------------------------------------------------------------------------------
Total Investments, at Value (Cost $271,321,353) 120.9% 276,840,642
- ----------------------------------------------------------------------------------------------------------
Liabilities in Excess of Other Assets (20.9) (47,933,664)
----- ------------
Net Assets 100.0% $228,906,978
===== ============
</TABLE>
1. Face amount is reported in U.S. Dollars, except for those denoted in the
following currencies:
CAD--Canadian Dollar NZD--New Zealand Dollar
2. Interest-Only Strips represent the right to receive the monthly interest
payments on an underlying pool of mortgage loans. These securities typically
decline in price as interest rates decline. Most other fixed income securities
increase in price when interest rates decline. The principal amount of the
underlying pool represents the notional amount on which current interest is
calculated. The price of these securities is typically more sensitive to changes
in prepayment rates than traditional mortgage-backed securities (for example,
GNMA pass-throughs). Interest rates disclosed represent current yields based
upon the current cost basis and estimated timing and amount of future cash
flows.
3. When-issued security to be delivered and settled after June 30, 1997.
4. Principal-Only Strips represent the right to receive the monthly principal
payments on an underlying pool of mortgage loans. The value of these securities
generally increases as interest rates decline and prepayment rates rise. The
price of these securities is typically more volatile than that of coupon-bearing
bonds of the same maturity. Interest rates disclosed represent current yields
based upon the current cost basis and estimated timing of future cash flows.
5. Identifies issues considered to be illiquid or restricted. See Note 7 of
Notes to Financial Statements.
22 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
6. Represents the current interest rate for a variable rate security.
7. Represents securities sold under Rule 144A, which are exempt from
registration under the Securities Act of 1933, as amended. These securities have
been determined to be liquid under guidelines established by the Board of
Trustees. These securities amount to $12,501,874 or 5.46% of the Fund's net
assets, at June 30, 1997.
8. A sufficient amount of securities has been designated to cover outstanding
written call options, as follows:
<TABLE>
<CAPTION>
Face Expiration Exercise Premium Market Value
Subject to Call Date Price Received See Note 1
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Federal National Mortgage
Assn., 7.50%, 8/1/27 $7,100,000 9/97 99.70% $49,922 $49,922
</TABLE>
9. Securities with an aggregate market value of $1,415,339 are held in
collateralized accounts to cover initial margin requirements on open futures
sales contracts. See Note 5 of Notes to Financial Statements.
10. Denotes a step bond: a zero coupon bond that converts to a fixed or variable
interest rate at a designated future date.
11. Units may be comprised of several components, such as debt and equity and/or
warrants to purchase equity at some point in the future. For units which
represent debt securities, face amount disclosed represents total underlying
principal.
12. For zero coupon bonds, the interest rate shown is the effective yield on the
date of purchase.
13. Non-income producing security.
14. Interest or dividend is paid in kind.
See accompanying Notes to Financial Statements.
23 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities June 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
Assets
Investments, at value (cost $271,321,353)--see accompanying
statement $276,840,642
- --------------------------------------------------------------------------------
Receivables:
Investments sold 12,763,772
Interest and principal paydowns 3,453,872
Shares of beneficial interest sold 551,847
Daily variation on futures contracts--Note 5 65,031
- --------------------------------------------------------------------------------
Other 3,599
------------
Total assets 293,678,763
================================================================================
Liabilities
Bank overdraft 117,631
- --------------------------------------------------------------------------------
Options written, at value (premiums received $49,922)--
see accompanying statement--Note 6 49,922
- --------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased (including $62,650,337 purchased on a
when-issued basis)--Note 1 63,125,160
Dividends 601,256
Shares of beneficial interest redeemed 583,054
Distribution and service plan fees 143,155
Transfer and shareholder servicing agent fees 24,879
Daily variation on futures contracts--Note 5 12,375
Other 114,353
------------
Total liabilities 64,771,785
================================================================================
Net Assets $228,906,978
============
================================================================================
Composition of Net Assets
Paid-in capital $227,583,755
- --------------------------------------------------------------------------------
Undistributed net investment income 39,270
- --------------------------------------------------------------------------------
Accumulated net realized loss on investments and
foreign currency transactions (4,074,517)
- --------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of
assets and liabilities denominated in foreign currencies 5,358,470
------------
Net assets $228,906,978
============
24 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
Net Asset Value Per Share
Class A Shares:
Net asset value and redemption price per share (based on
net assets of $183,378,529 and 17,130,577 shares of
beneficial interest outstanding) $10.70
Maximum offering price per share (net asset value plus sales
charge of 4.75% of offering price) $11.23
- --------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (less applicable contingent
deferred sales charge) and offering price per share (based on
net assets of $40,138,033 and 3,750,747 shares of beneficial
interest outstanding) $10.70
- --------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (less applicable contingent
deferred sales charge) and offering price per share (based on
net assets of $5,390,416 and 503,300 shares of beneficial
interest outstanding) $10.71
See accompanying Notes to Financial Statements.
25 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Statement of Operations For the Six Months Ended June 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
Investment Income
Interest (net of foreign withholding taxes of $768) $9,890,862
- -------------------------------------------------------------------------------
Dividends 100,450
----------
Total income 9,991,312
================================================================================
Expenses
Management fees--Note 4 863,144
- --------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 231,294
Class B 194,036
Class C 24,172
- --------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 186,474
- --------------------------------------------------------------------------------
Shareholder reports 69,254
- --------------------------------------------------------------------------------
Custodian fees and expenses 41,662
- --------------------------------------------------------------------------------
Legal and auditing fees 9,368
- --------------------------------------------------------------------------------
Trustees' fees and expenses 3,233
- --------------------------------------------------------------------------------
Other 7,255
----------
Total expenses 1,629,892
================================================================================
Net Investment Income 8,361,420
================================================================================
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investments 43,347
Closing of futures contracts 38,844
Closing of options written--Note 6 2,001
Foreign currency transactions (12,521)
----------
Net realized gain 71,671
- --------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on:
Investments 83,093
Translation of assets and liabilities denominated in
foreign currencies (32,653)
----------
Net change 50,440
----------
Net realized and unrealized gain 122,111
================================================================================
Net Increase in Net Assets Resulting From Operations $8,483,531
==========
See accompanying Notes to Financial Statements.
26 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended Year Ended
June 30, 1997 December 31,
(Unaudited) 1996
================================================================================================
<S> <C> <C>
Operations
Net investment income $ 8,361,420 $ 15,830,998
- ------------------------------------------------------------------------------------------------
Net realized gain 71,671 313,209
- ------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 50,440 (5,325,416)
------------ ------------
Net increase in net assets resulting from operations 8,483,531 10,818,791
================================================================================================
Dividends and Distributions To Shareholders
Dividends from net investment income:
Class A (6,888,584) (12,577,460)
Class B (1,275,135) (2,405,982)
Class C (158,431) (214,115)
- ------------------------------------------------------------------------------------------------
Tax return of capital distribution:
Class A -- (517,955)
Class B -- (103,919)
Class C -- (11,567)
================================================================================================
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting
from beneficial interest transactions--Note 2:
Class A (10,274,768) 28,392,776
Class B 1,297,394 659,280
Class C 1,061,183 404,645
================================================================================================
Net Assets
Total increase (decrease) (7,754,810) 24,444,494
- ------------------------------------------------------------------------------------------------
Beginning of period 236,661,788 212,217,294
------------ ------------
End of period (including undistributed net investment
income of $39,270 for the period ended 6/30/97) $228,906,978 $236,661,788
============ ============
</TABLE>
See accompanying Notes to Financial Statements.
27 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class A
-----------------------------------------------------------------------
Six Months
Ended
June 30,
1997 Year Ended December 31,
(Unaudited) 1996 1995 1994 1993 1992(2)
=====================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Data:
Net asset value, beginning of period $10.70 $10.98 $10.01 $11.12 $10.74 $10.80
- ---------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .39 .78 .69 .65 .69 .75
Net realized and
unrealized gain (loss) -- (.28) .96 (1.08) .40 (.05)
------ ------ ------ ------ ------ ------
Total income (loss) from
investment operations .39 .50 1.65 (.43) 1.09 .70
- ---------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net
investment income (.39) (.75) (.68) (.65) (.71) (.76)
Dividends in excess of net
investment income -- -- -- (.03) -- --
Tax return of capital distribution -- (.03) -- -- -- --
------ ------ ------ ------ ------ ------
Total dividends and distributions
to shareholders (.39) (.78) (.68) (.68) (.71) (.76)
- ---------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $10.70 $10.70 $10.98 $10.01 $11.12 $10.74
====== ====== ====== ====== ====== ======
=====================================================================================================================
Total Return, at Net Asset Value(3) 3.70% 4.87% 16.94% (3.87)% 10.30% 6.77%
=====================================================================================================================
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) $183,379 $193,515 $169,059 $96,640 $110,759 $106,290
- ---------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $189,375 $178,130 $116,940 $102,168 $111,702 $98,672
- ---------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 7.37%(4) 7.35% 6.47% 6.25% 6.20% 7.00%
Expenses, before voluntary
reimbursement by the Manager 1.27%(4) 1.30% 1.27% 1.06% 1.06% 1.10%
Expenses, net of voluntary
reimbursement by the Manager N/A N/A 1.26% N/A N/A N/A
- ---------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 23.3% 53.7% 175.4% 70.3% 110.1% 116.4%
</TABLE>
1. For the period from July 11, 1995 (inception of offering) to December 31,
1995.
2. For the period from May 1, 1993 (inception of offering) to December 31, 1993.
3. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), with all dividends
and distributions reinvested in additional shares on the reinvestment date, and
redemption at the net asset value calculated on the last business day of the
fiscal period. Sales charges are not reflected in the total returns. Total
returns are not annualized for periods of less than one full year.
4. Annualized.
28 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class B Class C
------------------------------------------------ --------------------------------
Six Months Six Months
Ended Ended
June 30, June 30, Year Ended
1997 Year Ended December 31, 1997 December 31,
(Unaudited) 1996 1995 1994 1993 (Unaudited) 1996 1995(1)
================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Data:
Net asset value, beginning of period $10.69 $10.98 $10.01 $11.11 $11.10 $10.70 $10.99 $10.89
- --------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .35 .70 .63 .58 .40 .35 .70 .28
Net realized and
unrealized gain (loss) .01 (.29) .94 (1.08) .03 .01 (.29) .10
------ ------ ------ ------ ------ ------ ------ ------
Total income (loss) from
investment operations .36 .41 1.57 (.50) .43 .36 .41 .38
- --------------------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net
investment income (.35) (.67) (.60) (.57) (.42) (.35) (.67) (.28)
Dividends in excess of net
investment income -- -- -- (.03) -- -- -- --
Tax return of capital distribution -- (.03) -- -- -- -- (.03) --
------ ------ ------ ------ ------ ------ ------ ------
Total dividends and distributions
to shareholders (.35) (.70) (.60) (.60) (.42) (.35) (.70) (.28)
- --------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $10.70 $10.69 $10.98 $10.01 $11.11 $10.71 $10.70 $10.99
====== ====== ====== ====== ====== ====== ====== ======
================================================================================================================================
Total Return, at Net Asset Value(3) 3.41% 3.99% 16.06% (4.53)% 3.91% 3.40% 4.00% 3.76%
================================================================================================================================
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) $40,138 $38,826 $39,187 $3,451 $1,809 $5,390 $4,322 $3,971
- --------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $39,139 $38,068 $12,823 $2,747 $922 $4,881 $3,404 $979
- --------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 6.60%(4) 6.59% 5.84% 5.53% 4.80%(4) 6.58%(4) 6.60% 6.32%(4)
Expenses, before voluntary
reimbursement by the Manager 2.02%(4) 2.05% 2.12% 1.78% 1.90%(4) 2.02%(4) 2.05% 2.25%(4)
Expenses, net of voluntary
reimbursement by the Manager N/A N/A 2.08% N/A N/A N/A N/A 1.96%(4)
- --------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 23.3% 53.7% 175.4% 70.3% 110.1% 23.3% 53.7% 175.4%
</TABLE>
5. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the period
ended June 30, 1997 were $63,083,800 and $59,674,260, respectively. For the year
ended December 31, 1995, purchases and sales of investment securities included
mortgage "dollar-rolls."
See accompanying Notes to Financial Statements.
29 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
1. Significant Accounting Policies
Oppenheimer Bond Fund (the Fund) is a separate fund of Oppenheimer Integrity
Funds, a diversified, open-end management investment company registered under
the Investment Company Act of 1940, as amended. The Fund's investment objective
is to seek a high level of current income by investing mainly in debt
instruments. The Fund's investment adviser is OppenheimerFunds, Inc. (the
Manager). The Fund offers Class A, Class B and Class C shares. Class A shares
are sold with a front-end sales charge. Class B and Class C shares may be
subject to a contingent deferred sales charge. All classes of shares have
identical rights to earnings, assets and voting privileges, except that each
class has its own distribution and/or service plan, expenses directly
attributable to that class and exclusive voting rights with respect to matters
affecting that class. Class B shares will automatically convert to Class A
shares six years after the date of purchase. The following is a summary of
significant accounting policies consistently followed by the Fund.
- --------------------------------------------------------------------------------
Investment Valuation. Portfolio securities are valued at the close of the New
York Stock Exchange on each trading day. Listed and unlisted securities for
which such information is regularly reported are valued at the last sale price
of the day or, in the absence of sales, at values based on the closing bid or
the last sale price on the prior trading day. Long-term and short-term
"non-money market" debt securities are valued by a portfolio pricing service
approved by the Board of Trustees. Such securities which cannot be valued by an
approved portfolio pricing service are valued using dealer-supplied valuations
provided the Manager is satisfied that the firm rendering the quotes is reliable
and that the quotes reflect current market value, or are valued under
consistently applied procedures established by the Board of Trustees to
determine fair value in good faith. Short-term "money market type" debt
securities having a remaining maturity of 60 days or less are valued at cost (or
last determined market value) adjusted for amortization to maturity of any
premium or discount. Forward foreign currency contracts are valued based on the
closing prices of the forward currency contract rates in the London foreign
exchange markets on a daily basis as provided by a reliable bank or dealer.
Options are valued based upon the last sale price on the principal exchange on
which the option is traded or, in the absence of any transactions that day, the
value is based upon the last sale price on the prior trading date if it is
within the spread between the closing bid and asked prices. If the last sale
price is outside the spread, the closing bid is used.
30 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
Securities Purchased on a When-Issued Basis. Delivery and payment for securities
that have been purchased by the Fund on a forward commitment or when-issued
basis can take place a month or more after the transaction date. During this
period, such securities do not earn interest, are subject to market fluctuation
and may increase or decrease in value prior to their delivery. The Fund
maintains, in a segregated account with its custodian, assets with a market
value equal to the amount of its purchase commitments. The purchase of
securities on a when-issued or forward commitment basis may increase the
volatility of the Fund's net asset value to the extent the Fund makes such
purchases while remaining substantially fully invested. As of June 30, 1997, the
Fund had entered into outstanding when-issued or forward commitments of
$62,650,337.
In connection with its ability to purchase securities on a when-issued or
forward commitment basis, the Fund may enter into mortgage "dollar-rolls" in
which the Fund sells securities for delivery in the current month and
simultaneously contracts with the same counterparty to repurchase similar (same
type coupon and maturity) but not identical securities on a specified future
date. The Fund records each dollar-roll as a sale and a new purchase
transaction.
- --------------------------------------------------------------------------------
Foreign Currency Translation. The accounting records of the Fund are maintained
in U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars at the closing rates of exchange. Amounts related
to the purchase and sale of foreign securities and investment income are
translated at the rates of exchange prevailing on the respective dates of such
transactions.
The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.
- --------------------------------------------------------------------------------
Repurchase Agreements. The Fund requires the custodian to take possession, to
have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. The market value of the underlying securities is required
to be at least 102% of the resale price at the time of purchase. If the seller
of the agreement defaults and the value of the collateral declines, or if the
seller enters an insolvency proceeding, realization of the value of the
collateral by the Fund may be delayed or limited.
- --------------------------------------------------------------------------------
Allocation of Income, Expenses, and Gains and Losses. Income, expenses (other
than those attributable to a specific class) and gains and losses are allocated
daily to each class of shares based upon the relative proportion of net assets
represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
31 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Unaudited) (Continued)
- --------------------------------------------------------------------------------
================================================================================
1. Significant Accounting Policies (continued)
Federal Taxes. The Fund intends to continue to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income or excise tax provision is required.
- --------------------------------------------------------------------------------
Distributions to Shareholders. The Fund intends to declare dividends separately
for Class A, Class B and Class C shares from net investment income each day the
New York Stock Exchange is open for business and pay such dividends monthly.
Distributions from net realized gains on investments, if any, will be declared
at least once each year.
- --------------------------------------------------------------------------------
Classification of Distributions to Shareholders. Net investment income (loss)
and net realized gain (loss) may differ for financial statement and tax purposes
primarily because of paydown gains and losses and the recognition of certain
foreign currency gains (losses) as ordinary income (loss) for tax purposes. The
character of the distributions made during the year from net investment income
or net realized gains may differ from its ultimate characterization for federal
income tax purposes. Also, due to timing of dividend distributions, the fiscal
year in which amounts are distributed may differ from the fiscal year in which
the income or realized gain was recorded by the Fund.
- --------------------------------------------------------------------------------
Other. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date). Discount on securities purchased is amortized
over the life of the respective securities, in accordance with federal income
tax requirements. Realized gains and losses on investments and unrealized
appreciation and depreciation are determined on an identified cost basis, which
is the same basis used for federal income tax purposes.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
32 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
2. Shares of Beneficial Interest
The Fund has authorized an unlimited number of no par value shares of beneficial
interest of each class. Transactions in shares of beneficial interest were as
follows:
<TABLE>
<CAPTION>
Six Months Ended June 30,1997 Year Ended December 31, 1996
----------------------------- ----------------------------
Shares Amount Shares Amount
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------
Class A:
Sold 1,131,530 $ 12,028,795 1,955,093 $ 20,810,615
Dividends reinvested 422,044 4,481,854 815,100 8,651,382
Issued in connection with
the acquisition of:
Connecticut Mutual Income
Account--Note 8 -- -- 3,020,216 31,863,280
Jefferson-Pilot Investment Grade
Bond Fund, Inc.--Note 8 -- -- 1,801,334 19,273,967
Redeemed (2,512,838) (26,785,417) (4,901,741) (52,206,468)
---------- ----------- ---------- -----------
Net increase (decrease) (959,264) $(10,274,768) 2,690,002 $ 28,392,776
========== =========== ========== ===========
- -------------------------------------------------------------------------------------------
Class B:
Sold 574,859 $ 6,118,425 946,117 $ 10,072,138
Dividends reinvested 81,462 865,093 163,467 1,735,740
Issued in connection with
the acquisition of:
Connecticut Mutual
Income Account--Note 8 -- -- 8,156 86,045
Redeemed (536,072) (5,686,124) (1,057,712) (11,234,643)
---------- ----------- ---------- -----------
Net increase 120,249 $ 1,297,394 60,028 $ 659,280
========== =========== ========== ===========
- -------------------------------------------------------------------------------------------
Class C:
Sold 155,245 $ 1,653,407 279,925 $ 2,989,461
Dividends reinvested 10,784 114,615 17,112 181,810
Redeemed (66,474) (706,839) (254,743) (2,766,626)
---------- ----------- ---------- -----------
Net increase 99,555 $ 1,061,183 42,294 $ 404,645
========== =========== ========== ===========
</TABLE>
================================================================================
3. Unrealized Gains and Losses on Investments
At June 30, 1997, net unrealized appreciation on investments of $5,519,289 was
composed of gross appreciation of $7,844,231, and gross depreciation of
$2,324,942.
33 Oppenheimer Bond Fund
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Unaudited) (Continued)
- --------------------------------------------------------------------------------
================================================================================
4. Management Fees and Other Transactions with Affiliates
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for a fee of 0.75% of the first
$200 million of the Fund's average annual net assets, 0.72% of the next $200
million, 0.69% of the next $200 million, 0.66% of the next $200 million, 0.60%
of the next $200 million, and 0.50% of aggregate net assets over $1 billion.
For the six months ended June 30, 1997, commissions (sales charges paid by
investors) on sales of Class A shares totaled $145,865, of which $57,614 was
retained by OppenheimerFunds Distributor, Inc. (OFDI), a subsidiary of the
Manager, as general distributor, and by an affiliated broker/dealer. Sales
charges advanced to broker/dealers by OFDI on sales of the Fund's Class B and C
shares totaled $206,911 and $14,507, respectively, of which $22,720 was paid to
an affiliated broker/dealer for Class B. During the six months ended June 30,
1997, OFDI received contingent deferred sales charges of $91,092, upon
redemption of Class B shares as reimbursement for sales commissions advanced by
OFDI at the time of sale of such shares.
OppenheimerFunds Services (OFS), a division of the Manager, is the
transfer and shareholder servicing agent for the Fund and for other registered
investment companies. OFS's total costs of providing such services are allocated
ratably to these companies.
The Fund has adopted a Service Plan for Class A shares to reimburse OFDI
for a portion of its costs incurred in connection with the personal service and
maintenance of shareholder accounts that hold Class A shares. Reimbursement is
made quarterly at an annual rate that may not exceed 0.25% of the average annual
net assets of Class A shares of the Fund. OFDI uses the service fee to reimburse
brokers, dealers, banks and other financial institutions quarterly for providing
personal service and maintenance of accounts of their customers that hold Class
A shares. During the six months ended June 30, 1997, OFDI paid $77,555 to an
affiliated broker/dealer as reimbursement for Class A personal service and
maintenance expenses.
34 Oppenheimer Bond Fund
<PAGE>
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The Fund has adopted Distribution and Service Plans for Class B and Class C
shares to compensate OFDI for its services and costs in distributing Class B and
Class C shares and servicing accounts. Under the Plans, the Fund pays OFDI an
annual asset-based sales charge of 0.75% per year on Class B and Class C shares,
as compensation for sales commissions paid from its own resources at the time of
sale and associated financing costs. OFDI also receives a service fee of 0.25%
per year as compensation for costs incurred in connection with the personal
service and maintenance of accounts that hold shares of the Fund, including
amounts paid to brokers, dealers, banks and other financial institutions. Both
fees are computed on the average annual net assets of Class B and Class C
shares, determined as of the close of each regular business day. During the six
months ended June 30, 1997, OFDI paid $3,000 to an affiliated broker/dealer as
compensation for Class B personal service and maintenance expenses and retained
$155,232 and $11,781, respectively, as compensation for Class B and Class C
sales commissions and service fee advances, as well as financing costs. If
either Plan is terminated by the Fund, the Board of Trustees may allow the Fund
to continue payments of the asset-based sales charge to OFDI for distributing
shares before the Plan was terminated. At June 30, 1997, OFDI had incurred
unreimbursed expenses of $1,004,511 for Class B and $67,542 for Class C.
================================================================================
5. Futures Contracts
The Fund may buy and sell interest rate futures contracts in order to gain
exposure to or protect against changes in interest rates. The Fund may also buy
or write put or call options on these futures contracts.
The Fund generally sells futures contracts to hedge against increases in
interest rates and the resulting negative effect on the value of fixed rate
portfolio securities. The Fund may also purchase futures contracts to gain
exposure to changes in interest rates as it may be more efficient or cost
effective than actually buying fixed income securities.
Upon entering into a futures contract, the Fund is required to deposit
either cash or securities in an amount (initial margin) equal to a certain
percentage of the contract value. Subsequent payments (variation margin) are
made or received by the Fund each day. The variation margin payments are equal
to the daily changes in the contract value and are recorded as unrealized gains
and losses. The Fund recognizes a realized gain or loss when the contract is
closed or expires.
35 Oppenheimer Bond Fund
<PAGE>
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Notes to Financial Statements (Unaudited) (Continued)
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================================================================================
5. Futures Contracts (continued)
Securities held in collateralized accounts to cover initial margin requirements
on open futures contracts are noted in the Statement of Investments. The
Statement of Assets and Liabilities reflects a receivable or payable for the
daily mark to market for variation margin.
Risks of entering into futures contracts (and related options) include the
possibility that there may be an illiquid market and that a change in the value
of the contract or option may not correlate with changes in the value of the
underlying securities.
At June 30, 1997, the Fund had outstanding futures contracts to purchase
and sell debt securities as follows:
<TABLE>
<CAPTION>
Expiration Number of Valuation as of Unrealized
Contracts to Purchase Date Futures Contracts June 30, 1997 Depreciation
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S. Treasury Bonds, 30 yr. 9/97 22 $ 2,443,375 $ 7,344
=========== --------
Contracts to Sell
- --------------------------------------------------------------------------------------------------
U.S. Treasury Nts., 5 yr. 9/97 190 $20,119,219 $109,297
U.S. Treasury Nts., 10 yr. 9/97 81 8,737,875 43,219
----------- --------
$28,857,094 152,516
=========== --------
$159,860
========
</TABLE>
================================================================================
6. Option Activity
The Fund may buy and sell put and call options, or write put and covered call
options on portfolio securities in order to produce incremental earnings or
protect against changes in the value of portfolio securities.
The Fund generally purchases put options or writes covered call options to
hedge against adverse movements in the value of portfolio holdings. When an
option is written, the Fund receives a premium and becomes obligated to sell or
purchase the underlying securities at a fixed price, upon exercise of the
option.
Options are valued daily based upon the last sale price on the principal
exchange on which the option is traded and unrealized appreciation or
depreciation is recorded. The Fund will realize a gain or loss upon the
expiration or closing of the option transaction. When an option is exercised,
the proceeds on sales for a written call option, the purchase cost for a written
put option, or the cost of the security for a purchased put or call option is
adjusted by the amount of premium received or paid.
Securities designated to cover outstanding call options are noted in the
Statement of Investments where applicable. Shares subject to call, expiration
date, exercise price, premium received and market value are detailed in a
footnote to the Statement of Investments. Options written are reported as a
liability in the Statement of Assets and Liabilities. Gains and losses are
reported in the Statement of Operations.
36 Oppenheimer Bond Fund
<PAGE>
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The risk in writing a call option is that the Fund gives up the opportunity for
profit if the market price of the security increases and the option is
exercised. The risk in writing a put option is that the Fund may incur a loss if
the market price of the security decreases and the option is exercised. The risk
in buying an option is that the Fund pays a premium whether or not the option is
exercised. The Fund also has the additional risk of not being able to enter into
a closing transaction if a liquid secondary market does not exist.
Written option activity for the six months ended June 30, 1997 was as follows:
Call Options Put Options
------------------------ -----------------------
Number of Amount of Number of Amount of
Options Premiums Options Premiums
- --------------------------------------------------------------------------------
Options outstanding at
December 31, 1996 -- $ -- -- $ --
Options written 7,100 49,922 9 2,618
Options closed or expired -- -- (9) (2,618)
----- ------- -- -------
Options outstanding at
June 30, 1997 7,100 $49,922 -- $ --
===== ======= == =======
================================================================================
7. Illiquid and Restricted Securities
At June 30, 1997, investments in securities included issues that are illiquid or
restricted. Restricted securities are often purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Trustees as reflecting fair value. A security may be considered
illiquid if it lacks a readily-available market or if its valuation has not
changed for a certain period of time. The Fund intends to invest no more than
10% of its net assets (determined at the time of purchase and reviewed
periodically) in illiquid or restricted securities. Certain restricted
securities, eligible for resale to qualified institutional investors, are not
subject to that limit. The aggregate value of illiquid or restricted securities
subject to this limitation at June 30, 1997 was $17,674,153, which represents
7.72% of the Fund's net assets.
37 Oppenheimer Bond Fund
<PAGE>
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Notes to Financial Statements (Unaudited) (Continued)
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8. Acquisition of Connecticut Mutual Income Account and
Jefferson-Pilot Investment Grade Bond Fund, Inc.
On April 26, 1996, the Fund acquired all the net assets of Connecticut Mutual
Income Account, pursuant to an agreement and plan of reorganization approved by
the Connecticut Mutual Income Account shareholders on March 18, 1996. The Fund
issued 3,020,216 and 8,156 shares of beneficial interest for Class A and Class
B, respectively, valued at $31,863,280 and $86,045, in exchange for the net
assets, resulting in combined Class A net assets of $189,629,984 and Class B net
assets of $6,106,676 on April 26, 1996. The net assets acquired included net
unrealized depreciation of $633,177. The exchange qualifies as a tax-free
reorganization for federal income tax purposes.
On December 20, 1996, the Fund acquired all the net assets of
Jefferson-Pilot Investment Grade Bond Fund, Inc. pursuant to an agreement and
plan of reorganization approved by the Jefferson-Pilot Investment Grade Bond
Fund shareholders on December 3, 1996. The Fund issued 1,801,334 shares of
beneficial interest for Class A, valued at $19,273,967, in exchange for the net
assets, resulting in combined Class A net assets of $202,088,473 on December 20,
1996. The net assets acquired included net unrealized appreciation of
$1,288,511. The exchange qualifies as a tax-free reorganization for federal
income tax purposes.
================================================================================
9. Subsequent Event
Effective July 15, 1997, the Fund's portfolio manager is David P. Negri. He is
the individual principally responsible for the day-to-day management of the
Fund's portfolio. Mr. Negri is a Vice President of the Manager and of the Fund
and has been a portfolio manager of the Fund since July 10, 1995.
38 Oppenheimer Bond Fund
<PAGE>
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Oppenheimer Bond Fund
- --------------------------------------------------------------------------------
A Series of Oppenheimer Integrity Funds
================================================================================
Officers and Trustees James C. Swain, Chairman and Chief Executive Officer
Bridget A. Macaskill, President
Robert G. Avis, Trustee
William A. Baker, Trustee
Charles Conrad, Jr., Trustee
Raymond J. Kalinowski, Trustee
C. Howard Kast, Trustee
Robert M. Kirchner, Trustee
Ned M. Steel, Trustee
George C. Bowen, Vice President, Treasurer and
Assistant Secretary
Andrew J. Donohue, Vice President and Secretary
David P. Negri, Vice President
David A. Rosenberg, Vice President
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
================================================================================
Investment Adviser OppenheimerFunds, Inc.
================================================================================
Distributor OppenheimerFunds Distributor, Inc.
================================================================================
Transfer and Shareholder OppenheimerFunds Services
Servicing Agent
================================================================================
Custodian of The Bank of New York
Portfolio Securities
================================================================================
Independent Auditors Deloitte & Touche LLP
================================================================================
Legal Counsel Myer, Swanson, Adams & Wolf, P.C.
The financial statements included herein have been
taken from the records of the Fund without examination
by the independent auditors.
This is a copy of a report to shareholders of
Oppenheimer Bond Fund. This report must be preceded by
a Prospectus of Oppenheimer Bond Fund. For material
information concerning the Fund, see the Prospectus.
Shares of Oppenheimer funds are not deposits or
obligations of any bank, are not guaranteed by any
bank, and are not insured by the FDIC or any other
agency, and involve investment risks, including
possible loss of the principal amount invested.
39 Oppenheimer Bond Fund
<PAGE>
Information and services
- --------------------------------------------------------------------------------
As an Oppenheimer fund shareholder, you have some special privileges.
Whether it's automatic investment plans, informative newsletters and hotlines,
or ready account access, you can benefit from services designed to make
investing simple.
And when you need help, our Customer Service Representatives are only a
toll-free phone call away. They can provide information about your account and
handle administrative requests. You can reach them at our General Information
number.
When you want to make a transaction, you can do it easily by calling our
toll-free Telephone Transactions number. And, by enrolling in AccountLink, a
convenient service that "links" your Oppenheimer funds accounts and your bank
checking or savings account, you can use the Telephone Transactions number to
make investments.
For added convenience, you can get automated information with
OppenheimerFunds PhoneLink service, available 24 hours a day, 7 days a week.
PhoneLink gives you access to a variety of fund, account, and market
information. Of course, you can always speak with a Customer Service
Representative during the General Information hours shown at the left.
You can count on us whenever you need assistance. That's why the
International Customer Service Association, an independent, nonprofit
organization made up of over 3,200 customer service management professionals
from around the country, honored the Oppenheimer funds' transfer agent,
OppenheimerFunds Services, with their Award of Excellence in 1993.
So call us today, or visit us at our website at
www.oppenheimerfunds.com--we're here to help.
Internet
24-hr access to account information
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General Information
Mon-Fri 8:30am-9pm ET
Sat 10am-4pm ET
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24 hours a day, timely and
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RS0285.001.0697 August 30, 1997 [LOGO] OppenheimerFundsSM
Distributor, Inc.
