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THE ARCH FUND(R), INC.
The ARCH Money Market Portfolio
The ARCH Treasury Money Market Portfolio
The ARCH Tax-Exempt Money Market Portfolio
The ARCH Growth & Income Equity Portfolio
The ARCH Emerging Growth Portfolio
The ARCH Government & Corporate Bond Portfolio
The ARCH U.S. Government Securities Portfolio
The ARCH Balanced Portfolio
The ARCH International Equity Portfolio
The ARCH Short-Intermediate Municipal Portfolio
The ARCH Missouri Tax-Exempt Bond Portfolio
The ARCH Kansas Tax-Exempt Bond Portfolio
(the "Fund")
Supplement dated November 13, 1996 to
Prospectus dated March 28, 1996
Effective May 28, 1996, Peter Merzian is the person primarily
responsible for the day-to-day management of the Fund's Balanced Portfolio.
Mr. Merzian, a Senior Associate of MVA, has been with MVA since 1993 and prior
thereto was employed as a portfolio manager of another financial institution.
Mr. Merzian also serves as portfolio manager of the Fund's Short-Intermediate
Municipal, Missouri Tax-Exempt Bond and Tax-Exempt Money Market Portfolios.
Also effective May 28, 1996, the Fund's Growth & Income Equity
Portfolio will be managed by Timothy S. Engelbrecht. Mr. Engelbrecht has
been employed by MVA for the past sixteen years and has had portfolio
management and other responsibilities for MVA for the past fifteen years.
* * * * *
On July 17, 1996, Clay Finlay, Inc. ("Clay Finlay"), the sub-adviser to
the Fund's International Equity Portfolio (the "Portfolio"), announced that it
had agreed to become a wholly-owned subsidiary of United Asset Management
Corporation ("UAM"), a financial services holding company. The transaction
closed on August 29, 1996, resulting in the automatic termination of Clay
Finley's existing sub-advisory agreement with Mississippi Valley Advisors Inc.
("MVA"), the Portfolio's adviser, with respect to the Portfolio. The Fund's
Board of Directors approved a new sub-advisory agreement between MVA and Clay
Finlay on August 21, 1996, and the new sub-advisory agreement was ratified and
approved by the Portfolio's shareholders at a Special Meeting of Shareholders of
the Portfolio held on October 18, 1996. Under the sub-advisory agreement, Clay
Finlay is entitled to receive sub-advisory fees from MVA at the annual rate of
.75% of the first $50 million of the Portfolio's average daily net assets, plus
.50% of the next $50 million of average daily net assets plus .25% of average
daily net assets in excess of $100 million. Frances Dakers, the Portfolio's
current portfolio manager and the person primarily responsible for its
day-to-day operations, will continue to manage the Portfolio under the new
sub-advisory agreement.
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Effective upon the close of business November 29, 1996, dividends from
investment income of the Growth & Income Equity and Balanced Portfolios are
declared and paid monthly to shareholders of record.
* * * * *
Effective December 1, 1996, the name of the Emerging Growth Portfolio
is changed to the "Small Cap Equity Portfolio."
INVESTORS SHOULD RETAIN THIS SUPPLEMENT WITH THE PROSPECTUS FOR
FUTURE REFERENCE
