Dreyfus
Intermediate Municipal
Bond Fund, Inc.
ANNUAL REPORT May 31, 2000
(reg.tm)
The views expressed herein are current to the date of this report. These views
and the composition of the fund's portfolio are subject to change at any time
based on market and other conditions.
* Not FDIC-Insured * Not Bank-Guaranteed * May Lose Value
Contents
THE FUND
--------------------------------------------------
2 Letter from the President
3 Discussion of Fund Performance
6 Fund Performance
7 Statement of Investments
21 Statement of Assets and Liabilities
22 Statement of Operations
23 Statement of Changes in Net Assets
24 Financial Highlights
25 Notes to Financial Statements
29 Report of Independent Auditors
30 Important Tax Information
FOR MORE INFORMATION
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Back Cover
The Fund
Dreyfus Intermediate Municipal
Bond Fund, Inc.
LETTER FROM THE PRESIDENT
Dear Shareholder:
We are pleased to present this annual report for Dreyfus Intermediate Municipal
Bond Fund, Inc., covering the 12-month period from June 1, 1999 through May 31,
2000. Inside, you' ll find valuable information about how the fund was managed
during the reporting period, including a discussion with the fund's portfolio
manager, Monica Wieboldt.
When the reporting period began, evidence had emerged that the U.S. economy was
growing strongly in an environment characterized by high levels of consumer
spending and low levels of unemployment. Concerns that inflationary pressures
might reemerge caused the Federal Reserve Board to raise short-term interest
rates six times during the reporting period, for a total increase of 1.75
percentage points. Despite an encouraging rally during the first quarter of
2000, higher interest rates generally led to an erosion of municipal bond
prices.
We appreciate your confidence over the past year, and we look forward to your
continued participation in Dreyfus Intermediate Municipal Bond Fund, Inc.
Sincerely,
Stephen E. Canter
President and Chief Investment Officer
The Dreyfus Corporation
June 15, 2000
DISCUSSION OF FUND PERFORMANCE
Monica Wieboldt, Portfolio Manager
How did Dreyfus Intermediate Municipal Bond Fund, Inc. perform during the
period?
For the 12-month reporting period ended May 31, 2000, Dreyfus Intermediate
Municipal Bond Fund, Inc. achieved a total return of -0.97%.(1) In comparison,
the fund' s peer group, as measured by the Lipper Intermediate Municipal Debt
Funds category average, achieved a -1.04% total return for the same period.(2)
We attribute the fund' s absolute performance to a difficult investment
environment. More specifically, the fund was negatively influenced by higher
interest rates as the Federal Reserve Board (the "Fed") tightened monetary
policy six times during the reporting period in an attempt to relieve
inflationary pressures.
What is the fund's investment approach?
The fund' s investment objective is to seek as high a level of federally
tax-exempt income as is consistent with the preservation of capital. The fund
includes bonds from issuers throughout the United States. In addition, we also
seek to manage the fund for a competitive total return.
In managing the fund, we first attempt to add value by selecting
investment-grade tax-exempt bonds in the maturity ranges that we believe are
most likely to provide the highest yields. These bonds comprise the portfolio's
long-term core position. We augment the core position with bonds that we believe
have the potential to provide both current income and capital appreciation
What other factors influenced the fund's performance?
As mentioned earlier, the fund was influenced by changing market conditions over
the past year. Although the first quarter of 2000 experienced an encouraging
municipal bond market rally, most of 1999 The Fund
DISCUSSION OF FUND PERFORMANCE (CONTINUED)
and the two months following the first quarter of 2000 saw more difficult
investment environments. As a result, our total return performance was modestly
negative over the full year.
When the reporting period began on June 1, 1999, investors had become concerned
that strong economic growth, high levels of consumer spending and historically
low levels of unemployment might rekindle long-dormant inflationary pressures,
especially rising wages in a tight job market. In an attempt to ease these
pressures and forestall a reacceleration of inflation, the Fed raised short-term
interest rates six times during the reporting period, causing most bond prices,
including many of the fund' s holdings, to fall. These interest-rate hikes
accounted for a total increase of 1.75 percentage points since mid-1999.
In addition, municipal bond prices fell because of adverse supply-and-demand
influences. For a variety of reasons, institutional investors such as insurance
and mutual fund companies have recently participated less in the tax-exempt bond
market. Despite strong demand from individual investors, the absence of
institutional buyers helped reduce overall demand and, therefore, drove
municipal bond prices down. During the first few months of 2000, however,
issuance of municipal bonds nationally declined sharply compared to the same
period one year ago. This supply reduction, combined with continued robust
demand from individual investors, helped support a brief rebound of municipal
bond prices, from which the fund' s holdings recently benefited, helping to
offset some of the market's previous declines.
What is the fund's current strategy?
We began to adopt a more defensive posture toward the end of 1999, and we have
generally maintained that posture through the end of the reporting period.
That' s because we anticipated the Fed's May 16, 2000 interest-rate hike, which
at 0.50 percentage points was particularly severe, and we are concerned that one
or more rate hikes may be implemented in the near future.
During the reporting period, we saw the market go through several cycles.
Accordingly, we focused on maintaining or shortening duration when possible,
reducing our exposure to discount positions as the market rose and, as the
effects of the rate increases filtered through the market, adding issues with
strong income characteristics and call protection when the opportunities arose.
From a security selection perspective, we have reduced our holdings of bonds
that carry the risk of early redemption within the next 10 years. This strategy
was designed to protect the fund' s income stream by locking in competitive
yields for a longer period. We also increased our vigilance with regard to the
credit quality of our holdings, focusing on highly rated bonds that are backed
by specific revenues. We also favor general obligation bonds that are backed by
their issuers' general taxing authority.
June 15, 2000
(1) TOTAL RETURN INCLUDES REINVESTMENT OF DIVIDENDS AND ANY CAPITAL GAINS PAID.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. SHARE PRICE, YIELD AND
INVESTMENT RETURN FLUCTUATE SUCH THAT UPON REDEMPTION, FUND SHARES MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST. INCOME MAY BE SUBJECT TO STATE AND LOCAL
TAXES, AND SOME INCOME MAY BE SUBJECT TO THE FEDERAL ALTERNATIVE MINIMUM TAX
(AMT) FOR CERTAIN INVESTORS. RETURN FIGURES PROVIDED REFLECT THE ABSORPTION OF
FUND EXPENSES BY THE DREYFUS CORPORATION PURSUANT TO AN UNDERTAKING IN EFFECT
THAT MAY BE EXTENDED, TERMINATED OR MODIFIED AT ANY TIME. HAD THESE EXPENSES NOT
BEEN ABSORBED, THE FUND'S RETURN WOULD HAVE BEEN LOWER.
(2) SOURCE: LIPPER ANALYTICAL SERVICES, INC.
The Fund
<TABLE>
<CAPTION>
FUND PERFORMANCE
Comparison of change in value of $10,000 investment in Dreyfus Intermediate
Municipal Bond Fund, Inc. and the Lehman Brothers 10-Year Municipal Bond Index
--------------------------------------------------------------------------------
Average Annual Total Returns AS OF 5/31/00
1 Year 5 Years 10 Years
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FUND (0.97)% 4.12% 6.06%
((+)) SOURCE: LIPPER ANALYTICAL SERVICES, INC.
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
THE ABOVE GRAPH COMPARES A $10,000 INVESTMENT MADE IN DREYFUS INTERMEDIATE
MUNICIPAL BOND FUND, INC. ON 5/31/90 TO A $10,000 INVESTMENT MADE IN THE LEHMAN
BROTHERS 10-YEAR MUNICIPAL BOND INDEX ON THAT DATE. ALL DIVIDENDS AND CAPITAL
GAIN DISTRIBUTIONS ARE REINVESTED.
THE FUND INVESTS PRIMARILY IN MUNICIPAL SECURITIES AND MAINTAINS A PORTFOLIO
WITH A WEIGHTED-AVERAGE MATURITY RANGING BETWEEN 3 AND 10 YEARS. THE FUND'S
PERFORMANCE SHOWN IN THE LINE GRAPH TAKES INTO ACCOUNT FEES AND EXPENSES. THE
LEHMAN BROTHERS 10-YEAR MUNICIPAL BOND INDEX, UNLIKE THE FUND, IS AN UNMANAGED
TOTAL RETURN PERFORMANCE BENCHMARK FOR THE INVESTMENT-GRADE, 10-YEAR TAX-EXEMPT
BOND MARKET, CONSISTING OF MUNICIPAL BONDS WITH MATURITIES OF 9-12 YEARS. THE
INDEX DOES NOT TAKE INTO ACCOUNT CHARGES, FEES AND OTHER EXPENSES. THESE
FACTORS, COUPLED WITH THE POTENTIALLY LONGER MATURITY OF THE INDEX, CAN
CONTRIBUTE TO THE INDEX POTENTIALLY OUTPERFORMING OR UNDERPERFORMING THE FUND.
FURTHER INFORMATION RELATING TO FUND PERFORMANCE, INCLUDING EXPENSE
REIMBURSEMENTS, IF APPLICABLE, IS CONTAINED IN THE FINANCIAL HIGHLIGHTS SECTION
OF THE PROSPECTUS AND ELSEWHERE IN THIS REPORT.
<TABLE>
<CAPTION>
STATEMENT OF INVESTMENTS
May 31, 2000
Principal
LONG-TERM MUNICIPAL INVESTMENTS--97.3% Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA--.9%
Bay Minette Industrial Development Board, IDR
<S> <C> <C>
(Coltec Industries, Inc) 6.50%, 2/15/2009 4,505,000 4,445,985
McIntosh Industrial Development Board, EIR
4.65%, 6/1/2008 5,500,000 5,005,275
ALASKA--3.2%
Alaska Industrial Development and Export Authority,
Revolving Fund 6.375%, 4/1/2008 3,000,000 3,074,760
Alaska Housing Finance Corp.:
5.75%, 12/1/2009 (Insured; MBIA) 9,130,000 9,246,681
5.30%, 12/1/2012 (Insured; MBIA) 2,500,000 2,399,375
Alaska Student Loan Corp., Student Loan Revenue:
5.60%, 7/1/2011 (Insured; AMBAC) 4,700,000 4,626,304
5.70%, 7/1/2013 (Insured; AMBAC) 5,990,000 5,820,423
Anchorage, Electric Utility Revenue:
6.50%, 12/1/2008 (Insured; MBIA) 2,755,000 2,958,429
6.50%, 12/1/2009 (Insured; MBIA) 2,910,000 3,135,380
5.875%, 12/1/2012 (Insured; FSA) 3,175,000 3,233,293
ARIZONA--2.9%
Maricopa County Community College District
4%, 7/1/2013 8,325,000 6,853,307
Maricopa County Industrial Development Authority:
Hospital Facility Revenue (Samaritan Health Services)
7.15%, 12/1/2004 (Insured; MBIA) 9,835,000 10,451,261
Hospital Systems Revenue (Baptist Hospital)
5.20%, 9/1/2005 (Insured; MBIA) 3,125,000 3,131,125
Mesa Industrial Development Authority, Revenue
(TRW Vehicle Safety Systems, Inc.)
7.25%, 10/15/2004 5,000,000 5,070,900
Phoenix 4.125%, 7/1/2014 7,080,000 5,832,433
CALIFORNIA--2.0%
California:
7.119%, 12/1/2013 5,000,000 (a,b) 4,735,800
5.40%, 12/1/2014 (Insured; MBIA) 5,000,000 4,879,800
California Statewide Community Development Authority:
Apartment Development Revenue
(Irvine Apartment Communities) 5.10%, 5/17/2010 4,000,000 3,761,440
MFHR 5.20%, 12/1/2029 3,000,000 2,848,380
Student Education Loan Marketing Corporation,
Student Loan Revenue:
6.70%, 7/1/2008 2,500,000 2,488,575
6.75%, 7/1/2008 2,500,000 2,511,375
The Fund
STATEMENT OF INVESTMENTS (CONTINUED)
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
COLORADO--3.6%
Bowles Metropolitan District, 4.25%, 12/1/2023
(LOC; U.S. Bank National Association) 5,000,000 4,660,650
E-470 Public Highway Authority, Revenue
Zero Coupon, 9/1/2010 (Insured; MBIA) 30,000,000 16,497,300
El Paso County School District
(Number 11 Colorado Springs):
6.25%, 12/1/2009 1,000,000 1,063,670
6.50%, 12/1/2010 2,000,000 2,165,400
6.50%, 12/1/2011 2,040,000 2,225,824
Interlocken Metropolitan District:
Zero Coupon, 12/15/2007 2,835,000 1,838,242
Zero Coupon, 12/15/2008 2,835,000 1,726,969
Metropolitan Football Stadium District, Sales Tax Revenue
Zero Coupon, 1/1/2008 (Insured; MBIA) 12,000,000 7,858,920
CONNECTICUT--1.0%
Connecticut, Revenue
(Mashantucket Western Pequot Tribe):
6.50%, 9/1/2006 (Escrowed to Maturity) 2,475,000 2,650,700
6.50%, 9/1/2006 2,525,000 2,629,005
5.60%, 9/1/2009 1,000,000 960,990
5.70%, 9/1/2012 2,400,000 2,257,776
Connecticut Development Authority, PCR
(United Illuminating) 4.35%, 6/1/2026 2,125,000 2,012,970
DISTRICT OF COLUMBIA--1.0%
District of Columbia, Revenue (American University)
5.50%, 10/1/2011 (Insured; AMBAC) 5,435,000 5,382,661
Metropolitan Airports Authority, Airport Revenue
5.75%, 10/1/2011 (Insured; MBIA) 5,750,000 5,772,137
FLORIDA--1.6%
Dade County, Resource Recovery Facility Revenue
5.20%, 10/1/2005 (Insured; AMBAC) 7,880,000 7,852,262
Orange County, Tourist Development Tax Revenue
5%, 10/1/2015 (Insured; MBIA) 5,000,000 4,628,100
Palm Beach County, Solid Waste IDR
(Okeelanta Power L.P. Project) 6.50%, 2/15/2009 3,600,000 (c) 1,936,800
Pinellas County, RRR
5.10%, 10/1/2003 (Insured; MBIA) 2,915,000 2,908,179
GEORGIA--1.1%
Atlanta, Airport Facilities Revenue:
6%, 1/1/2007 (Insured; AMBAC) 5,780,000 6,010,217
Zero Coupon, 1/1/2010 (Insured; MBIA) 9,600,000 5,364,864
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
HAWAII--.3%
Hawaii, Airports System Revenue
7.50%, 7/1/2005 (Insured; FGIC) 3,000,000 3,066,750
ILLINOIS--7.2%
Carol Stream, First Mortgage Revenue
(Windsor Park Manor) 6.50%, 12/1/2007 3,000,000 2,940,240
Chicago O'Hare International Airport:
Passenger Facility Charge Revenue
5.50%, 1/1/2008 (Insured; AMBAC) 5,000,000 5,022,800
Special Facility Revenue:
4.748%, 4/1/2011 2,750,000 (a,b) 2,040,390
(United Airlines, Inc.)
5.35%, 9/1/2016 6,500,000 5,434,715
Chicago Public Building Commission, Building Revenue
5.50% 2/1/2006 (Insured; FGIC) 2,000,000 2,021,640
Hoffman Estates, Tax Increment Revenue
(Area Economic Development):
7.50%, 11/15/2003 (LOC; Union Bank
of Switzerland, Prerefunded 11/15/2000) 5,145,000 (d) 5,311,852
5.25%, 11/15/2009 10,000,000 9,828,100
Illinois Development Finance Authority, Providers Facility
Acquisition Revenue, (Community Rehabilitation):
8.25%, 9/1/2000 545,000 546,275
5.60%, 7/1/2003 1,485,000 1,467,923
5.60%, 7/1/2004 1,000,000 979,640
5%, 7/1/2006 2,510,000 2,305,385
5.90%, 7/1/2009 1,325,000 1,256,153
Illinois Educational Facilities Authority, Revenue:
(Illinois Institute of Technology) 6.60%, 12/1/2009 2,665,000 2,803,367
(MJH Education Assistance)
5%, 9/1/2013 (Insured; AMBAC) 3,000,000 2,757,780
Illinois Health Facilities Authority, Revenue:
(Central Dupage Health Wyndemere Retirement
Community) 6.125%, 11/1/2007 (Insured; MBIA) 4,400,000 4,512,332
(Evangelical Hospital):
6.75%, 4/15/2007 2,035,000 2,154,536
6.75%, 4/15/2007 (Prerefunded 4/15/2002) 1,055,000 (d) 1,106,431
(Southern Illinois Hospital Services) 6.50%, 3/1/2007
(Insured; MBIA, Prerefunded 3/1/2002) 4,000,000 (d) 4,174,520
Illinois Student Assistance Commission
Student Loan Revenue:
5.45%, 9/1/2005 2,050,000 2,043,809
5.55%, 9/1/2006 4,000,000 3,993,560
The Fund
STATEMENT OF INVESTMENTS (CONTINUED)
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (CONTINUED)
Metropolitan Pier and Exposition Authority, Dedicated
Tax Revenue (McCormick Place Exposition):
Zero Coupon, 6/15/2015 (Insured; FGIC) 10,040,000 4,102,846
5.375, 12/15/2015 (Insured; FGIC) 6,485,000 6,214,705
Normal, EDR (Dayton - Hudson Corp. Project)
6.75%, 11/1/2001 3,400,000 3,465,756
INDIANA--8.8%
Boonville Junior High School Building Corp.,
First Mortgage Revenue 6.80%, 7/1/2005 3,100,000 3,238,477
Brownsburg School Building Corp.,
First Mortgage Revenue:
5.80%, 8/1/2008
(Insured; FSA, Prerefunded 2/1/2005) 2,650,000 (d) 2,765,036
5.90%, 8/1/2009
(Insured; FSA, Prerefunded 2/1/2005) 2,895,000 (d) 3,032,570
Central High School Building Corp., First Mortgage
5.50%, 8/1/2009 (Insured; AMBAC) 3,960,000 3,980,909
Indiana Bond Bank (Hendricks Special Hospital Program)
6.90%, 4/1/2006 3,000,000 3,123,630
Indiana Development Finance Authority, PCR
(Inland Steel Company Project Number 13):
5.75%, 10/1/2011 11,500,000 9,854,350
7.25%, 11/1/2011 10,330,000 9,897,173
Indiana Health Facility Financing Authority, HR
(Clarian Health Partners, Inc.):
5.50%, 2/15/2010 3,000,000 2,928,210
5.50%, 2/15/2011 5,000,000 4,832,800
Indiana Municipal Power Agency,
Power Supply Systems Revenue
5.70%, 1/1/2006 (Insured; MBIA) 8,400,000 8,566,236
Indiana Transportation Finance Authority,
Airport Facilities LR (United Air):
6.50%, 11/1/2007 2,575,000 2,668,498
6.50%, 11/1/2007 (Prerefunded 11/1/2002) 2,675,000 (d) 2,816,053
Indianapolis Local Public Improvement Bond Bank:
6.30%, 2/1/2004 2,800,000 2,893,352
6.40%, 2/1/2005 3,000,000 3,130,170
6.50%, 1/1/2011 (Insured; FSA) 6,415,000 6,953,603
Knox County Hospital Association, LR
5.65%, 7/1/2008 (Insured; MBIA) 4,150,000 4,192,247
North Montgomery Elementary School Building Corp.
First Mortgage Revenue 6.50%, 7/1/2006 5,665,000 5,886,332
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
INDIANA (CONTINUED)
Plymouth, Multi-School Building Corp.
(First Mortgage-Plymouth Community School)
5.50%, 7/1/2005 (Insured; MBIA) 3,000,000 3,038,940
Sullivan, PCR (Michigan Power Company Project)
5.95%, 5/1/2009 2,500,000 2,449,150
Westfield High School Building Corp.,
First Mortgage Revenue:
5.45%, 7/15/2009
(Insured; AMBAC, Prerefunded 7/15/2005) 5,000,000 (d) 5,149,250
5.25%, 7/5/2013 (Insured; AMBAC) 3,000,000 2,856,510
IOWA--1.3%
Ames, HR (Mary Greeley Medical Center Project)
6.25%, 8/15/2006 (Insured; AMBAC) 4,320,000 4,470,854
Council Bluffs, IDR (Cargill, Inc. Project) 7%, 3/1/2007 4,400,000 4,596,240
Iowa Student Loan Liquidity Corp.,
Student Loan Revenue
6.65%, 3/1/2003
(Insured; Guaranteed Student Loans) 4,900,000 5,046,363
KENTUCKY--1.6%
Carrolton and Henderson Public Energy Authority,
Gas Revenue (Kentucky Trust)
5%, 1/1/2006 (Insured; FSA) 4,500,000 4,314,015
Jefferson County School District Finance Corporation,
School Building Revenue
4.50%, 2/1/2015 (Insured; MBIA) 3,930,000 3,317,431
Kenton County Airport Board, Airport Revenue
(Cincinnati/Northern Kentucky International)
5.75%, 3/1/2009 (Insured; MBIA) 3,710,000 3,754,706
Mount Sterling, LR (Kentucky League Cities Funding)
5.625%, 3/1/2003 6,000,000 6,054,060
LOUISIANA--1.7%
Louisiana Office Facilities Corporation, LR
(Capitol Complex Program)
5%, 3/1/2006 (Insured; MBIA) 2,605,000 2,572,177
Louisiana Public Facilities Authority, Revenue:
6.60%, 11/15/2012 4,430,000 4,603,302
6.60%, 11/15/2012 (Prerefunded 11/15/2002) 3,635,000 (d) 3,829,945
(Louisiana Association of Independent Colleges
and Universities) 6.50%, 12/1/2002 2,155,000 2,201,268
Saint Charles Parish, PCR
6.361%, 10/1/2003 5,125,000 (a,b) 4,859,013
The Fund
STATEMENT OF INVESTMENTS (CONTINUED)
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
MAINE--.4%
Maine Educational Loan Marketing Corp.
Student Loan Revenue 6.90%, 11/1/2003 4,120,000 4,193,748
MARYLAND--.9%
Northeast Waste Disposal Authority, RRR
(Baltimore Resco Retrofit Project):
4.75%, 1/1/2012 6,900,000 5,549,049
5%, 1/1/2012 5,000,000 4,134,900
MASSACHUSETTS--2.5%
Barnstable 4.50%, 3/15/2015 320,000 272,086
Boston Industrial Development Financing Authority,
Sewage Facility Revenue (Harbor Electric Energy Co.)
7.10%, 5/15/2002 1,550,000 1,573,839
Massachusetts:
6.40%, 8/1/2003 3,175,000 3,297,111
5.40%, 9/1/2005 5,000,000 (a,b) 4,955,950
Water Pollution Abatement Revenue
5.50%, 2/1/2008 (Prerefunded 2/1/2006) 5,640,000 (d) 5,776,375
Massachusetts Housing Finance Agency
Housing Revenue:
6.30%, 7/1/2007 (Insured; AMBAC) 2,795,000 2,890,170
6.35%, 7/1/2008 (Insured; AMBAC) 3,005,000 3,107,170
6.40%, 7/1/2009 (Insured; AMBAC) 3,275,000 3,386,154
Plymouth County, COP (Correctional Facilities Project)
5%, 4/1/2015 (Insured; AMBAC) 2,025,000 1,852,875
MICHIGAN--5.7%
Detroit Local Development Finance Authority
5.20%, 5/1/2010 5,745,000 5,458,842
Greater Detroit Resource Recovery Authority, Revenue:
6.25%, Series A, 12/13/2008 (Insured; AMBAC) 11,000,000 11,643,830
6.25%, Series B, 12/13/2008 (Insured; AMBAC) 7,755,000 8,208,900
Michigan Hospital Finance Authority, Revenue:
6.09%, 11/15/2007 6,750,000 (a,b) 6,520,770
5.45%, 11/15/2033 5,000,000 (a,b) 4,720,200
(Genesys Health System)
8.10%, 10/1/2013 (Prerefunded 10/1/2005) 10,000,000 (d) 11,504,400
Michigan Strategic Fund:
Obligation Revenue (Detroit Edison) 4.73%, 9/1/2029 3,750,000 3,736,275
SWDR (Genesee Power Station Project)
7.125%, 1/1/2006 6,300,000 6,333,642
Wayne State University, University Revenues
5.40%, 11/15/2006 (Insured; AMBAC) 2,775,000 2,830,056
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI--.8%
Mississippi Development Bank, Special Obligation
(Adams County HR Project)
5.75%, 7/1/2010 (Insured; FSA) 3,445,000 3,488,097
Walnut Grove Correctional Authority, COP:
5.25%, 11/1/2005 (Insured; AMBAC) 1,670,000 1,667,979
5.50%, 11/1/2006 (Insured; AMBAC) 1,760,000 1,776,474
5.50%, 11/1/2007 (Insured; AMBAC) 1,855,000 1,867,818
MISSOURI--2.0%
Joplin Industrial Development Authority, Revenue
(Catholic Health Initiatives):
5.50%, 12/1/2009 3,185,000 3,142,194
5.625%, 12/1/2010 3,340,000 3,308,738
Phelps City Industrial Development Authority, Revenue
(Excel Corp. Project) 7%, 12/1/2000 4,500,000 4,547,565
Saint Louis, Airport Improvement Revenue
(Lambert - Saint Louis International Airport):
6%, 7/1/2005 (Insured; FGIC) 1,545,000 1,571,698
6%, 7/1/2005 (Insured; FGIC, Prerefunded 7/1/2002) 8,130,000 (d) 8,432,761
NEBRASKA--.2%
Albion, IDR (Cargill, Inc.) 7%, 12/1/2000 2,600,000 2,628,886
NEVADA--1.0%
Clark County, Passenger Facility Charge Revenue
(Las Vegas McCarran International Airport):
5.95%, 7/1/2005 (Insured; AMBAC) 6,365,000 6,580,964
5.80%, 7/1/2009 (Insured; MBIA) 4,250,000 4,302,615
NEW JERSEY--2.2%
New Jersey Economic Development Authority:
Special Facilities Revenue
(Continental Airlines, Inc.)
6.625%, 9/15/2012 7,500,000 7,403,100
Waste Paper Recycling Revenue
(Marcal Paper Mills, Inc.):
5.75%, 2/1/2004 (Insured; MBIA) 2,325,000 2,289,125
8.50%, 2/1/2010 (Insured; MBIA) 2,930,000 3,153,676
New Jersey Turnpike Authority, Revenue
5.625%, 1/1/2015 (Insured; MBIA) 5,000,000 4,980,050
Orange Township
6.60%, 2/1/2007 (Insured; FSA, Prerefunded 2/1/2005) 5,600,000 (d) 5,852,336
NEW MEXICO--.6%
New Mexico Educational Assistance Foundation,
Student Loan Revenue
6.70%, 3/1/2006 6,425,000 6,554,914
The Fund
STATEMENT OF INVESTMENTS (CONTINUED)
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK--8.5%
City University of New York, COP (John Jay College)
5.75%, 8/15/2004 5,970,000 6,050,476
Long Island Power Authority, Electric System Revenue:
4.25%, 4/1/2003 6,000,000 5,801,520
5.50%, 12/1/2010 (Insured; AMBAC) 5,100,000 5,142,483
5%, 4/1/2012 (Insured; MBIA) 5,000,000 4,873,250
New York City:
5.70%, 8/1/2007 3,450,000 3,493,160
6.25%, 8/1/2009 7,000,000 7,296,660
6.375%, 8/15/2009 19,750,000 20,706,493
6.375%, 8/15/2009 (Prerefunded 8/15/2005) 5,250,000 (d) 5,601,225
5%, 8/1/2012 3,935,000 3,635,114
New York State Dormitory Authority, Revenues
(Department of Health):
5.50%, 7/1/2010 2,000,000 1,954,560
5.625%, 7/1/2011 3,240,000 3,187,447
New York State Thruway Authority, Service Contract
Revenue (Local Highway & Bridge):
6%, 4/1/2011 5,000,000 5,090,350
5.25%, 4/1/2013 (Insured; MBIA) 4,500,000 4,326,975
New York State Urban Development Corp.,
Correctional Facilities Revenue 5.25%, 1/1/2010 4,520,000 4,359,856
Niagara Falls City School District, COP
(High School Facility):
5.625%, 6/15/2011 (Insured; MBIA) 1,835,000 1,846,946
5.625%, 6/15/2012 (Insured; MBIA) 1,935,000 1,936,625
Triborough Bridge and Tunnel Authority, Revenue
6.75%, 1/1/2009 5,100,000 5,541,048
NORTH CAROLINA--2.1%
Coastal Regional Solid Waste Management Authority,
Solid Waste Disposal System Revenue
4%, 6/1/2006 (Insured; AMBAC) 2,150,000 1,950,652
North Carolina Eastern Municipal Power Agency,
Power System Revenue
5%, 1/1/2002 4,860,000 4,809,650
North Carolina Medical Care Commission,
Health Care Facilities Revenue
(First Mortgage-Deerfield) 5.30%, 11/1/2004 5,840,000 5,629,293
North Carolina Municipal Power Agency,
Electric Revenue (Number 1 Catawba)
5.50%, 1/1/2010 10,000,000 9,596,800
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
OHIO--2.6%
Cleveland, Airport Systems Revenue:
5.50%, 1/1/2005 (Insured; FSA) 1,000,000 1,006,180
(Continental Airlines, Inc.)
5.50%, 12/1/2008 (Insured; FSA) 5,000,000 4,561,450
Cuyahoga County, HR (Metrohealth System)
5.25%, 2/15/2010 (Insured; MBIA) 5,160,000 5,054,065
Franklin County, HR (Holy Cross Health Systems)
5.20%, 6/1/2005 (Insured; MBIA) 2,930,000 2,934,483
Knox County, Hospital Facilities Revenue
(Knox Community Hospital Asset Guaranty)
5%, 6/1/2012 1,500,000 1,401,585
Lorain, Hospital Improvement Revenue
(Lakeland Community Hospital, Inc.)
6.50%, 11/15/2012 3,860,000 4,064,927
Ohio Air Quality Development Authority, PCR
(Cleveland) 4.60%, 10/1/2030 3,085,000 2,924,395
Ohio Water Development Authority,
Pollution Control Facilities Revenue
(Cleveland Electric) 4.60%, 10/1/2030 6,000,000 5,696,220
OKLAHOMA--.6%
Washington County Medical Authority, Revenue
(Jane Phillips Medical Center)
5.50%, 11/1/2010 (Insured; Connie Lee) 6,175,000 6,114,423
OREGON--1.0%
Multnomah County, COP:
4.50%, 8/1/2014 695,000 595,504
4.50%, 8/1/2015 2,000,000 1,694,060
Port Portland International Airport, Revenue
5%, 7/1/2014 (Insured; MBIA) 2,555,000 2,315,367
Washington County Unified Sewer Agency
Sewer Revenue 5.75%, 10/1/2012 (Insured; FGIC) 5,670,000 5,813,111
PENNSYLVANIA--4.3%
Beaver County Industrial Development Authority, PCR
(Ohio Edison Co. Project) 3.619%, 6/1/2004 7,500,000 (a,b) 6,643,800
Delaware County Industrial Development Authority, PCR
(Peco Energy Co.) 5.20%, 4/1/2021 4,000,000 3,883,560
Erie County Hospital Authority, Revenue
(Hamot Health Foundation)
5.375%, 5/15/2010 (Insured; AMBAC) 2,340,000 2,294,042
The Fund
STATEMENT OF INVESTMENTS (CONTINUED)
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA (CONTINUED)
Pennsylvania Economic Development Financing Authority,
RRR (Northampton Generating):
6.75%, 1/1/2007 7,000,000 7,017,850
6.40%, 1/1/2009 11,000,000 10,647,340
6.50%, 1/1/2013 2,000,000 1,921,920
Pennsylvania Higher Educational Facilities Authority,
Health Services Revenue (University of Pennsylvania):
5.60%, Series A, 1/1/2010 4,750,000 4,381,685
5.60%, Series B, 1/1/2010 4,350,000 4,012,701
5.70%, 2/1/2011 5,250,000 4,825,223
RHODE ISLAND--2.1%
Rhode Island Health and Educational Building Corp.,
Health Facilities Revenue (San Antoine)
5.50%, 11/15/2009 3,320,000 3,225,878
Hospital Financing Revenue
(Lifespan Obligation Group):
5.75%, 5/15/2007 (Insured; MBIA) 4,805,000 4,886,012
5.75%, 5/15/2008 (Insured; MBIA) 5,560,000 5,643,066
Rhode Island Housing and Mortgage Finance Corp.:
(Homeownership Opportunity) 7.30%, 10/1/2008 4,680,000 4,913,485
(Rental Housing Program):
5.65%, 10/1/2007 2,175,000 2,175,718
5.65%, 10/1/2008 1,350,000 1,346,341
SOUTH CAROLINA--2.7%
Charleston County, Health Facilities Revenue
(Espiscopal Church) 5.40%, 4/1/2004 5,000,000 4,829,100
Charleston County, Hospital Facilities Improvement
Revenue (Medical Society Health)
5.50%, 10/1/2005 (Insured; MBIA) 7,945,000 8,025,562
Charleston County, RRR (Foster Wheeler)
5%, 1/1/2007 (Insured; AMBAC) 2,685,000 2,593,603
Georgetown County, Pollution Control Facilities Revenue
(International Paper Co.) 5.125%, 2/1/2012 3,000,000 2,713,860
Oconee County, PCR (Engelhard Corp. Project)
5.375%, 5/1/2006 3,500,000 3,447,675
Piedmont Municipal Power Agency, Electric Revenue:
6.25%, 1/1/2004 (Insured; FGIC, Escrowed To Maturity) 585,000 607,429
6.25%, 1/1/2004 (Insured; FGIC) 3,465,000 3,578,375
York County, PCR (Bowater, Inc.)
7.625%, 3/1/2006 2,900,000 3,061,704
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE--1.0%
Johnson City Health and Educational Facility Board, HR
(Medical Center Hospital Improvement)
5.125%, 7/1/2011 (Insured; MBIA) 6,720,000 6,526,195
Tennessee Housing Development Agency
(Homeownership Program):
5.20%, 7/1/2010 1,815,000 1,745,486
5.30% 7/1/2011 2,140,000 2,059,044
TEXAS--8.2%
Austin Independent School District:
5.60%, 8/1/2009 (Prerefunded 8/1/2006) 4,590,000 (d) 4,691,531
5.60% 8/1/2009 2,025,000 2,047,417
Ennis IDC, Revenue, (Cargill, Inc.)
6.15%, 11/1/2003 2,450,000 2,482,879
Gulf Coast Waste Disposal Authority, SWDR
(Quaker Oats Co.) 5.70%, 5/1/2006 2,210,000 2,210,420
Harris County Health Facilities Development Corp., HR:
(Memorial Hermann Hospital System)
5.50%, 6/1/2012 (Insured; FSA) 8,295,000 8,134,575
(Memorial Hospital System)
6%, 6/1/2008 (Insured; MBIA) 3,000,000 3,091,140
Harris County Hospital District, Mortgage Revenue
7.50%, 2/15/2003 (Insured; AMBAC) 5,475,000 5,680,039
Matagorda County, Navigation District, PCR
4.235%, 11/1/2001 5,000,000 (a,b) 4,937,600
North Central Health Facility Development Corp.,
Revenue (Baylor Healthcare System):
6.440%, 5/15/2008 11,750,000 12,085,228
6.440%, 5/15/2008 (Prerefunded 5/15/2002) 1,250,000 (d) 1,305,600
North Texas Higher Education Authority,
Student Loan Revenue:
7%, Series B, 4/1/2002 (Insured; AMBAC) 4,250,000 4,335,000
7%, Series E, 4/1/2002 (Insured; AMBAC) 4,250,000 4,335,000
Port Corpus Christi Authority, Nueces County
General Revenue (Union Pacific) 5.125%, 4/1/2009 2,250,000 2,031,705
Rio Grande Consolidated Independent School District,
Public Facilities LR 6.40%, 7/15/2003 4,000,000 3,997,600
Rio Grande Valley Health Facilities Development Corp., HR
(Valley Baptist Medical Center)
6.25%, 8/1/2006 (Insured; MBIA) 5,100,000 5,276,664
The Fund
STATEMENT OF INVESTMENTS (CONTINUED)
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (CONTINUED)
South Texas Higher Education Authority,
Student Loan Revenue 5.30%, 12/1/2003 2,245,000 2,224,907
Tarrant County Health Facilities Development Corp.,
Health Systems Revenue:
(Harris Methodist Health Systems) 6%, 9/1/2010 7,725,000 8,101,594
(Health Resources Systems)
5.75%, 2/15/2014 (Insured; MBIA) 5,000,000 4,997,150
Texas State College, Student Loan:
6%, 8/1/2005 2,130,000 2,194,986
6%, 8/1/2006 2,500,000 2,580,875
UTAH--1.7%
Carbon County, SWDR:
(Sunnyside Cogeneration-A) 6.375%, 8/15/2011 8,450,000 7,974,603
(Sunnyside Cogeneration-B) Zero Coupon, 8/15/2024 2,585,000 401,812
Utah Board of Regents, Student Loan Revenue:
6.25%, 11/1/2003 (Insured; AMBAC) 3,000,000 3,078,900
6.35%, 11/1/2004 (Insured; AMBAC) 3,000,000 3,101,340
6.45%, 11/1/2005 (Insured; AMBAC) 3,000,000 3,103,230
VIRGINIA--2.4%
Big Stone Gap Redevelopment and Housing Authority,
Correctional Facility, LR
(Wallens Ridge Development Project) 6%, 9/1/2007 4,000,000 4,172,480
Fairfax County Economic Development Authority,
Educational Facilities Revenue
(George Mason University Educational Foundation):
6.50%, 11/15/2002 2,000,000 2,034,960
6.95%, 11/15/2002 5,360,000 5,437,666
Lexington Industrial Development Authority,
Residential Care Facility Revenue
(First Mortgage) 5%, 10/1/2004 5,630,000 5,287,302
Virginia Housing Development Authority,
Commonwealth Mortgage:
6.05%, 1/1/2004 4,400,000 4,480,080
6.15%, 1/1/2005 4,400,000 4,507,800
WASHINGTON--3.0%
Clark County Public Utility District, Electric Revenue:
6.30%, 1/1/2004 (Insured; FGIC) 1,275,000 1,307,194
6.30%, 1/1/2004 (Insured; FGIC, Prerefunded 1/1/2001) 1,885,000 (d) 1,939,590
Washington Health Care Facilities Authority, Revenue
(Sisters of Providence)
5.40%, 10/1/2010 (Insured; AMBAC) 3,000,000 2,944,170
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON (CONTINUED)
Washington Housing Finance Commission:
MFHR (Alderbrook Apartments Project)
4.90% 7/1/2030 (LOC; Bank One, Arizona, N.A.) 7,100,000 6,648,369
SFMR 6.85%, 7/1/2011 (Insured: FNMA, GNMA) 2,535,000 2,579,362
Washington, Public Power Supply Systems Revenue
(Nuclear Project Number 1):
7.25%, 7/1/2006 (Insured; FSA) 6,000,000 6,580,740
6%, 7/1/2007 (Insured; AMBAC) 9,720,000 10,073,419
WISCONSIN--2.6%
Carlton, PCR (Wisconsin Public Service Corp.)
6.125%, 10/1/2005 5,000,000 5,152,550
Nekoosa, PCR (Nekoosa Papers, Inc.)
5.35%, 7/1/2015 4,850,000 4,267,661
Wisconsin Health and Educational Facilities Authority, Revenue:
(Aurora Health Care, Inc.):
5%, 8/15/2009 (Insured; MBIA) 4,335,000 4,103,251
5%, 8/15/2010 (Insured; MBIA) 3,955,000 3,703,383
(Aurora Medical Group, Inc.)
6%, 11/15/2011 (Insured; FSA) 3,500,000 3,627,575
(Luther Hospital) 6.125%, 11/15/2006 3,500,000 3,555,615
(Wheaton Franciscan Services, Inc.)
6.50%, 8/15/2007 (Insured; MBIA) 3,000,000 3,109,796
TOTAL LONG-TERM MUNICIPAL INVESTMENTS
(cost $1,052,676,534) 1,037,761,409
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM MUNICIPAL INVESTMENTS--1.4%
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA--.3%
Decatur Industrial Development Board, SWDR, VRDN
(Amoco Chemical Company) 4.55% 3,600,000 3,600,000
MICHIGAN--1.1%
Michigan Hospital Finance Authority, Revenue:
4.40% 6,750,000 6,750,000
4.35% 5,000,000 5,000,000
TOTAL SHORT-TERM MUNICIPAL INVESTMENTS
(cost $15,350,000) 15,350,000
------------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (cost $1,068,026,534) 98.7% 1,053,111,409
CASH AND RECEIVABLES (NET) 1.3% 13,826,944
NET ASSETS 100.0% 1,066,938,353
The Fund
</TABLE>
STATEMENT OF INVESTMENTS (CONTINUED)
Summary of Abbreviations
AMBAC American Municipal Bond
Assurance Corporation
COP Certificate of Participation
EDR Economic Development Revenue
EIR Environmental Improvement
Revenue
FGIC Financial Guaranty Insurance
Company
FNMA Federal National Mortgage
Association
FSA Financial Security Assurance
GNMA Government National Mortgage
Association
HR Hospital Revenue
IDC Industrial Development
Corporation
IDR Industrial Development Revenue
LOC Letter of Credit
LR Lease Revenue
MBIA Municipal Bond
Investors Assurance
Insurance Corporation
MFHR Multi-Family Housing Revenue
PCR Pollution Control Revenue
RRR Resources Recovery Revenue
SFMR Single Family Mortgage
Revenue
SWDR Solid Waste Disposal Revenue
VRDN Variable Rate Demand Notes
<TABLE>
<CAPTION>
Summary of Combined Ratings (Unaudited)
Fitch or Moody's or Standard & Poor's Value (%)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
AAA Aaa AAA 48.7
AA Aa AA 14.5
A A A 15.9
BBB Baa BBB 7.0
BB Ba BB 2.0
B B B 1.9
F1+, F-1 MIG1, VMIG1 & P1 SP1, A1 .8
Not Rated(e) Not Rated(e) Not Rated(e) 9.2
100.0
(A) INVERSE FLOATER SECURITY--THE INTEREST RATE IS SUBJECT TO CHANGE PERIODICALLY.
(B) SECURITIES EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE SECURITIES ACT
OF 1933. THESE SECURITIES MAY BE RESOLD IN TRANSACTIONS EXEMPT FROM REGISTRATION
NORMALLY TO QUALIFIED INSTITUTIONAL BUYERS. AT MAY 31, 2000, THESE SECURITIES
AMOUNTED TO $39,413,523 OR 3.7% OF THE NET ASSETS.
(C) NON-INCOME PRODUCING SECURITY; INTEREST PAYMENTS IN DEFAULT.
(D) BONDS WHICH ARE PREREFUNDED ARE COLLATERALIZED BY U.S. GOVERNMENT
SECURITIES WHICH ARE HELD IN ESCROW AND ARE USED TO PAY PRINCIPAL AND INTEREST
ON THE MUNICIPAL ISSUE AND TO RETIRE THE BONDS IN FULL AT THE EARLIEST REFUNDING
DATE.
(E) SECURITIES WHICH, WHILE NOT RATED BY FITCH, MOODY'S AND STANDARD & POOR'S
HAVE BEEN DETERMINED BY THE MANAGER TO BE OF COMPARABLE QUALITY TO THOSE RATED
SECURITIES IN WHICH THE FUND MAY INVEST.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENT OF ASSETS AND LIABILITIES
May 31, 2000
Cost Value
--------------------------------------------------------------------------------
ASSETS ($):
Investments in securities--See Statement of
Investments 1,068,026,534 1,053,111,40
Interest receivable 17,485,868
Receivable for shares of Common Stock subscribed 3,900
Prepaid expenses 11,119
1,070,612,296
--------------------------------------------------------------------------------
LIABILITIES ($):
Due to The Dreyfus Corporation and affiliates 652,578
Cash overdraft due to Custodian 2,613,464
Payable for shares of Common Stock redeemed 215,222
Accrued expenses 192,679
3,673,943
--------------------------------------------------------------------------------
NET ASSETS ($) 1,066,938,35
--------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS ($):
Paid-in capital 1,090,355,16
Accumulated net realized gain (loss) on investments (8,501,682)
Accumulated net unrealized appreciation (depreciation)
on investments--Note 4 (14,915,125)
--------------------------------------------------------------------------------
NET ASSETS ($) 1,066,938,353
--------------------------------------------------------------------------------
SHARES OUTSTANDING
(300 million shares of $.001 par value Common Stock authorized) 82,424,584
NET ASSET VALUE, offering and redemption price per share--Note 3(d) ($)
12.94
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
STATEMENT OF OPERATIONS
Year Ended May 31, 2000
--------------------------------------------------------------------------------
INVESTMENT INCOME ($):
INTEREST INCOME 66,227,594
EXPENSES:
Management fee--Note 3(a) 6,944,906
Shareholder servicing costs--Note 3(b) 1,587,700
Custodian fees 79,576
Professional fees 78,982
Prospectus and shareholders' reports 64,905
Directors' fees and expenses--Note 3(c) 56,876
Registration fees 37,725
Loan commitment fees--Note 2 12,272
Miscellaneous 55,256
TOTAL EXPENSES 8,918,198
Less--reduction in management fee due to undertaking--Note 3(a) (200,960)
NET EXPENSES 8,717,238
INVESTMENT INCOME--NET 57,510,356
--------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 4 ($):
Net realized gain (loss) on investments (8,487,107)
Net unrealized appreciation (depreciation) on investments (62,114,707)
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS (70,601,814)
NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS (13,091,458)
SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENT OF CHANGES IN NET ASSETS
Year Ended May 31,
-------------------------------------
2000 1999
--------------------------------------------------------------------------------
OPERATIONS ($):
Investment income--net 57,510,356 62,693,286
Net realized gain (loss) on investments (8,487,107) 11,626,654
Net unrealized appreciation (depreciation)
on investments (62,114,707) (27,720,053)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS (13,091,458) 46,599,887
--------------------------------------------------------------------------------
DIVIDENDS TO SHAREHOLDERS FROM ($):
Investment income--net (58,000,611) (62,553,395)
Net realized gain on investments (7,713,928) (11,801,579)
TOTAL DIVIDENDS (65,714,539) (74,354,974)
--------------------------------------------------------------------------------
CAPITAL STOCK TRANSACTIONS ($):
Net proceeds from shares sold 85,175,247 152,479,000
Dividends reinvested 48,514,964 54,958,796
Cost of shares redeemed (253,212,518) (260,941,326)
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL
STOCK TRANSACTIONS (119,522,307) (53,503,530)
TOTAL INCREASE (DECREASE) IN NET ASSETS (198,328,304) (81,258,617)
--------------------------------------------------------------------------------
NET ASSETS ($):
Beginning of Period 1,265,266,657 1,346,525,274
END OF PERIOD 1,066,938,353 1,265,266,657
Undistributed investment income-net -- 490,255
--------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS (SHARES):
Shares sold 6,409,564 10,818,392
Shares issued for dividends reinvested 3,661,646 3,895,035
Shares redeemed (19,104,095) (18,514,989)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING (9,032,885) (3,801,562)
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance for the fiscal periods indicated.
Total return shows how much your investment in the fund would have increased (or
decreased) during each period, assuming you had reinvested all dividends and
distributions. These figures have been derived from the fund's financial
statements.
Year Ended May 31,
-------------------------------------------------------------------
2000 1999 1998 1997 1996
------------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA ($):
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period 13.83 14.14 13.85 13.75 14.02
Investment Operations:
Investment income--net .66 .67 .69 .71 .72
Net realized and unrealized
gain (loss) on investments (.79) (.18) .41 .20 (.24)
Total from Investment Operations (.13) .49 1.10 .91 .48
Distributions:
Dividends from investment income--net (.67) (.67) (.69) (.70) (.72)
Dividends from net realized gain
on investments (.09) (.13) (.12) (.11) (.03)
Total Distributions (.76) (.80) (.81) (.81) (.75)
Net asset value, end of period 12.94 13.83 14.14 13.85 13.75
------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) (.97) 3.53 8.04 6.80 3.44
------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to average net assets .75 .75 .74 .73 .71
Ratio of net investment income
to average net assets 4.97 4.75 4.91 5.10 5.14
Decrease reflected in above expense
ratios due to undertakings by
The Dreyfus Corporation .02 .02 .01 -- --
Portfolio Turnover Rate 20.86 20.37 40.27 46.67 48.70
------------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period ($ x 1,000) 1,066,938 1,265,267 1,346,525 1,387,575 1,467,340
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
NOTE 1--Significant Accounting Policies:
Dreyfus Intermediate Municipal Bond Fund, Inc. (the "fund") is registered under
the Investment Company Act of 1940, as amended (the "Act"), as a diversified
open-end management investment company. The fund's investment objective is to
provide the maximum amount of current income exempt from Federal income tax as
is consistent with the preservation of capital. The Dreyfus Corporation (the
" Manager" ) serves as the fund's investment adviser. The Manager is a direct
subsidiary of Mellon Bank, N.A. , which is a wholly-owned subsidiary of Mellon
Financial Corporation. Effective March 22, 2000, Dreyfus Service Corporation
("DSC"), a wholly-owned subsidiary of the Manager, became the distributor of the
fund' s shares which are sold to the public without a sales charge. Prior to
March 22, 2000, Premier Mutual Fund Services, Inc. was the distributor
The fund' s financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumptions. Actual results could differ from those estimates.
(a) Portfolio valuation: Investments in securities are valued each business day
by an independent pricing service (" Service" ) approved by the Board of
Directors. Investments for which quoted bid prices are readily available and are
representative of the bid side of the market in the judgment of the Service are
valued at the mean between the quoted bid prices (as obtained by the Service
from dealers in such securities) and asked prices (as calculated by the Service
based upon its evaluation of the market for such securities). Other investments
(which constitute a majority of the portfolio securities) are carried at fair
value as determined by the Service, based on methods which include consideration
of: yields or prices of municipal securities of comparable quality, coupon,
maturity and type; indications as to values from dealers; and general market
conditions.
(b) Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Realized gain and loss from The Fun
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
securities transactions are recorded on the identified cost basis. Interest
income, adjusted for amortization of premiums and original issue discounts on
investments, is earned from settlement date and recognized on the accrual basis.
Securities purchased or sold on a when-issued or delayed-delivery basis may be
settled a month or more after the trade date. Under the terms of the custody
agreement, the fund receives net earnings credits based on available cash
balances left on deposit.
(c) Dividends to shareholders: It is the policy of the fund to declare dividends
daily from investment income-net. Such dividends are paid monthly. Dividends
from net realized capital gain are normally declared and paid annually, but the
fund may make distributions on a more frequent basis to comply with the
distribution requirements of the Internal Revenue Code of 1986, as amended (the
" Code" ). To the extent that net realized capital gain can be offset by capital
loss carryovers, if any, it is the policy of the fund not to distribute such
gain.
(d) Federal income taxes: It is the policy of the fund to continue to qualify as
a regulated investment company, which can distribute tax exempt dividends, by
complying with the applicable provisions of the Code, and to make distributions
of income and net realized capital gain sufficient to relieve it from
substantially all Federal income and excise taxes.
The fund has an unused capital loss carryover of approximately $7,208,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to May 31, 2000. This amount is
calculated based on Federal income tax regulations which may differ from
financial reporting in accordance with generally accepted accounting principles.
If not applied, the carryover expires in fiscal 2008.
NOTE 2--Bank Line of Credit:
The fund participates with other Dreyfus-managed funds in a $500 million
redemption credit facility (the "Facility" ) to be utilized for temporary or
emergency purposes, including the financing of redemp
tions. In connection therewith, the fund has agreed to pay commitment fees on
its pro rata portion of the Facility. Interest is charged to the fund at rates
based on prevailing market rates in effect at the time of borrowings. During the
period ended May 31, 2000, the fund did not borrow under the Facility.
NOTE 3--Management Fee and Other Transactions With Affiliates:
(a) Pursuant to a management agreement ("Agreement") with the Manager, the
management fee is computed at the annual rate of .60 of 1% of the value of the
fund' s average daily net assets and is payable monthly. The Manager had
undertaken from June 1, 1999 through May 31, 2000 to reduce the management fee
paid by the fund, to the extent that the fund's aggregate annual expenses,
exclusive of taxes, brokerage fees, interest on borrowings, commitment fees and
extraordinary expenses, exceeded an annual rate of .75 of 1% of the value of the
fund' s average daily net assets. The reduction in management fee, pursuant to
the undertaking, amounted to $200,960 during the period ended May 31, 2000.
(b) Under the Shareholder Services Plan, the fund reimburses DSC an amount not
to exceed an annual rate of .25 of 1% of the value of the fund's average daily
net assets for certain allocated expenses of providing personal services and/or
maintaining shareholder accounts. The services provided may include personal
services relating to shareholder accounts, such as answering shareholder
inquiries regarding the fund and providing reports and other information, and
services related to the maintenance of shareholder accounts. During the period
ended May 31, 2000, the fund was charged $904,631 pursuant to the Shareholder
Services Plan.
The fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of the
Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the fund. During the period
ended May 31, 2000, the fund was charged $459,253 pursuant to the transfer
agency agreement.
The Fund
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(c) Each director who is not an "affiliated person" as defined in the Act
receives from the fund an annual fee of $4,500 and an attendance fee of $500 per
meeting. The Chairman of the Board receives an additional 25% of such
compensation.
(d) A .10% redemption fee is charged and retained by the fund on shares redeemed
within fifteen days following the date of issuance, including redemptions made
through use of the fund's exchange privilege. During the period ended May 31,
2000, redemption fees charged and retained by the fund amounted to $7,143.
Effective June 1, 2000, this fee will be chargeable within thirty days following
the date of issuance of such shares.
NOTE 4--Securities Transactions:
The aggregate amount of purchases and sales of investment securities, excluding
short-term securities, during the period ended May 31, 2000, amounted to
$238,460,512 and $380,122,631, respectively.
At May 31, 2000, accumulated net unrealized depreciation on investments was
$14,915,125, consisting of $15,431,764 gross unrealized appreciation and
$30,346,889 gross unrealized depreciation.
At May 31, 2000, the cost of investments for Federal income tax purposes was
substantially the same as the cost for financial reporting purposes (see the
Statement of Investments).
REPORT OF INDEPENDENT AUDITORS
Shareholders and Board of Directors Dreyfus Intermediate Municipal Bond Fund,
Inc.
We have audited the accompanying statement of assets and liabilities of Dreyfus
Intermediate Municipal Bond Fund, Inc., including the statement of investments,
as of May 31, 2000, and the related statement of operations for the year then
ended, the statement of changes in net assets for each of the two years in the
period then ended, and financial highlights for each of the years indicated
therein. These financial statements and financial highlights are the
responsibility of the fund' s management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and financial highlights. Our procedures included
confirmation of securities owned as of May 31, 2000 by correspondence with the
custodian. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Dreyfus Intermediate Municipal Bond Fund, Inc at May 31, 2000, the results of
its operations for the year then ended, the changes in its net assets for each
of the two years in the period then ended, and the financial highlights for each
of the indicated years, in conformity with accounting principles generally
accepted in the United States.
New York, New York
July 5, 2000
The Fund
IMPORTANT TAX INFORMATION (Unaudited)
In accordance with Federal tax law, the fund hereby makes the following
designations regarding its fiscal year ended May 31, 2000:
--all the dividends paid from investment income-net are "exempt-interest
dividends" (not subject to regular Federal income tax) , an
--the fund hereby designates $.0819 per share as a long-term capital gain of the
$.0881 per share paid on December 8, 1999.
As required by Federal tax law rules, shareholders will receive notification of
their portion of the fund' s taxable ordinary dividends (if any) and capital
gains distributions (if any) paid for the 2000 calendar year on Form 1099-DIV
which will be mailed by January 31, 2001.
NOTES
For More Information
Dreyfus Intermediate Muncipal Bond Fund, Inc.
200 Park Avenue
New York, NY 10166
Manager
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
The Bank of New York
100 Church Street
New York, NY 10286
Transfer Agent &
Dividend Disbursing Agent
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Distributor
Dreyfus Service Corporation
200 Park Avenue
New York, NY 10166
To obtain information:
BY TELEPHONE Call 1-800-645-6561
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144
BY E-MAIL Send your request to [email protected]
ON THE INTERNET Information can be viewed online or downloaded from:
http://www.dreyfus.com
(c) 2000 Dreyfus Service Corporation 947AR005
