<PAGE> 1
December 31, 1995
ANNUAL REPORT
NML
Variable
Annuity
Account B
I N D I V I D U A L R E T I R E M E N T A N N U I T I E S
T A X D E F E R R E D A N N U I T I E S
N O N T A X - Q U A L I F I E D A N N U I T I E S
N O R T H W E S T E R N M U T U A L S E R I E S F U N D , I N C.
Northwestern
Mutual Life(R)
720 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
<PAGE> 2
NORTHWESTERN MUTUAL SERIES FUND, INC.
<TABLE>
<CAPTION>
DIRECTORS
<S><C>
James D. Ericson . . President and Chief Executive Officer, Northwestern Mutual Life,
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Milwaukee
Martin F. Stein . . . . . . . . . . . Chairman of the Board, EyeCare One Corporation,
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Milwaukee
John K. MacIver . . . . . . . . . Partner, Michael Best & Friedrich Attorneys at Law,
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Milwaukee
Stephen N. Graff . . . . . . . . . . . . . . . Retired Partner, Arthur Andersen & Co.,
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Milwaukee
William J. Blake . . . . . . . . . . . . . . . Chairman, Blake Financial Corporation,
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Milwaukee
OFFICERS
James D. Ericson . . . . . . . . . . . . . . . . . . . . . . . . . . . . . President
Mark G. Doll . . . . . . . . . . . . . . . . . . . . . . . Vice President & Treasurer
Merrill C. Lundberg . . . . . . . . . . . . . . . . . . . . . . . . . . . . Secretary
Gary E. Long . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Controller
</TABLE>
This report is submitted for the general information of owners of Northwestern
Mutual Life Variable Annuity Account B contracts. This report is not
authorized for distribution to prospective purchasers of variable annuity
contracts unless it is accompanied by an effective prospectus. Northwestern
Mutual Life variable annuity contracts are sold through individuals who, in
addition to being licensed life insurance agents of Northwestern Mutual Life,
are registered representatives of Northwestern Mutual Investment Services,
Inc., a wholly-owned subsidiary of Northwestern Mutual Life and a registered
broker-dealer under the Securities Exchange Act of 1934 and a member of the
National Association of Securities Dealers, Inc.
Northwestern
Mutual Life(R)
PO Box 3095
Milwaukee WI 53201-3095
Forwarding and Return Postage Guaranteed
Address Correction Requested
<PAGE> 3
CONTRACT OWNER PRIVILEGES
FREE TRANSFERS AMONG PORTFOLIOS
Same day transfers are permitted among our investment portfolios by FAX
414-299-2632. The appropriate form must be used. A blank form is included at the
end of this report. Additional forms are available from your Northwestern Mutual
Life Agent.
AUTOMATIC INVESTMENT PLAN
Under our Electronic Funds Transfer (EFT) Plan, you can set up regular
investments from your bank checking or NOW account.
AUTOMATIC DOLLAR COST AVERAGING PLAN
This plan automatically transfers money from the Money Market Portfolio to one
or several other portfolios each month. Regular amounts transferred at regular
intervals ensures that more units will be purchased when unit values are low,
and fewer units will be purchased when unit values are high, thereby averaging
out purchase prices.
SPECIAL WITHDRAWAL PRIVILEGE
For contracts with surrender charges, this liquidity feature allows you to avoid
them by withdrawing the lesser of 10% of the contract accumulation value, or
100% of contract earnings. (Contract must be at least one year old and the
accumulation value must be $10,000 minimum as of the most recent contract
anniversary date to qualify.)
OPTIONAL DISABILITY WAIVER BENEFIT
For a small additional premium and subject to meeting underwriting requirements,
considerations will continue to be paid into your contract by Northwestern
Mutual on your behalf should you become totally disabled.
CONTRACT OWNERS COMMUNICATIONS
Confirmation Statements following each transaction and quarterly Summary
Statements provide you with regular investment data. In addition, you will
receive timely economic and market summaries in our quarterly newsletter, VA
Perspectives.
<PAGE> 4
TO OUR CONTRACT OWNERS:
A banner year in the stock and bond markets helped many of Northwestern's
portfolios turn in strong performances for 1995. During the second half, when
the Dow galloped past the 5,000 mark, these portfolios continued to enjoy the
robust gains made during the first half. For the separate portfolios, judicious
stock selection played a critical role.
For example, in choosing more conservative stocks within the technology sector,
the Aggressive Growth Stock Portfolio dodged the biggest losses as the sector
sputtered in the second half. Similarly, the Growth Stock Portfolio exploited
increases in financials, telecommunications, health care and consumer
non-durable stocks. The Growth and Income Stock Portfolio, which tends to
approximate the sector weightings of the market, reaped the returns of the
overall market rally. Finally, though many international funds suffered during
the second half, the International Equity Portfolio turned in a very respectable
comparative performance in part due to good returns in several European markets.
For the US financial markets as a whole, slow economic growth and low inflation
proved to be extremely favorable for financial assets. Interest rates have
fallen steadily to levels not seen since early 1994, and corporations have
turned in record profits through cost cutting, higher operating margins and
higher productivity.
Also fueling the current market rally is a flood of money pouring into stock
mutual funds from retirement-oriented vehicles such as 401(k)s. A wave of
mergers and acquisitions along with share buy-back programs buoyed the market
while Initial Public Offerings (IPOs) and secondary offerings have surged to
record levels.
From our perspective, there are several signs that the US economy is coasting
toward a slowdown. Anemic housing starts, sluggish auto sales and poor retail
sales indicate a consumer reluctance to spend. Already saddled with bleaker job
prospects and high levels of debt, consumers seem to be reacting to the
continuing trend of corporate layoffs. Faced with this eroding consumer
confidence, the manufacturing sector is also feeling the pinch of a slower
economy. We view these as important short-term developments.
Amid this economic sluggishness, however, we see several bright spots. After
maintaining a relatively tight monetary policy during the early part of the
year, the Federal Reserve loosened its grip on the economy. Due to the economic
slowdown and a lack of inflationary pressure, the Fed can be expected to
gradually lower interest rates. Moreover, if significant progress is made on
balancing the budget, the Fed should begin to aggressively lower short-term
interest rates. Inflation, which remained subdued throughout the recovery,
appears poised to head even lower during the slowdown. Bottlenecks and
shortages--which normally put pressure on inflation--are now largely absent.
Looking ahead, we think it's wise to expect more volatility in the upcoming
year. Though there are many positive market trends, it is difficult to predict
where this unprecedented bull market will head in the future. It would not be
unreasonable to expect a setback in the financial markets at some point. But, in
our view, maintaining a long-term investment focus is the antidote to market
volatility.
1
<PAGE> 5
INDEX 500 STOCK PORTFOLIO
The Standard & Poor's 500 Index provided great performance in 1995
and outperformed the majority of active stock managers.
Northwestern's Index 500 Portfolio is designed to achieve investment
results that approximate the performance of the Standard & Poor's
500 Composite Stock Price Index and continues to achieve that
objective. The portfolio is fully invested in equities.
As indicated on the graph, on April 30, 1993, the portfolio was
indexed to approximate the performance of the Standard & Poor's 500
Composite Stock Price Index. Prior to April 30, 1993, the portfolio
was actively managed.
The Standard & Poor's 500 Composite Stock Price Index is an index of
unmanaged groups of 500 selected common stocks, most of which are
listed on the New York Stock Exchange. The index is heavily weighted
toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic
common stocks.
[Camera Ready Graph]
This chart assumes an initial investment of $10,000 made on 12/31/85. Returns
shown include deductions for management and other fund expenses, and
reinvestment of all dividends. Returns exclude deductions for separate account
sales loads and account fees. Past performance is not predictive of future
performance. Investment return and principal value will fluctuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
Accumulation unit values, which reflect deduction of charges for the separate
account, are shown on page 10.
Average Annual Total Return
For Periods Ended December 31, 1995
<TABLE>
<CAPTION>
One Five Ten
Year Years Years
---- ----- -----
<S> <C> <C> <C> <C> <C> <C>
Index 500 Stock Portfolio 37.25% 15.68% 12.29%
S&P 500 Index 37.40% 16.54% 14.83%
12/85 12/86 12/87 12/88 12/89
Index 500 Stock Portfolio $10,000 $11,536 $12,483 $13,585 $16,084
S&P 500 Index $10,000 $11,860 $12,465 $14,534 $19,141
12/90 12/91 12/92 12/93 12/94 12/95
Index 500 Stock Portfolio $15,389 $19,972 $20,879 $22,946 $23,225 $31,877
S&P 500 Index $18,548 $24,205 $26,045 $28,675 $29,019 $39,872
</TABLE>
A solid vertical line is drawn at 4/30/93 to indicate that the portfolio was
indexed on 4/30/93 and actively managed prior to that date.
2
<PAGE> 6
GROWTH STOCK PORTFOLIO
The performance of the Growth Stock Portfolio was helped by gains in
several sectors, including financials, telecommunications, health
care and consumer non-durable stocks. During the second half, the
portfolio maintained a relatively small cash position, but shifted
the types of stocks held in anticipation of weaker economic activity
and slower corporate profit growth in the upcoming year. Sector
weights were reduced in consumer cyclicals, basic materials and
technology, given the economic sensitivity of these industries.
Cash levels were kept close to seven percent of assets throughout
the period. The portfolio remains well diversified across major
market sectors, with strategy focused on identifying high quality
growth companies.
The Standard & Poor's 500 Composite Stock Price Index is an index of
unmanaged groups of 500 selected common stocks, most of which are
listed on the New York Stock Exchange. The index is heavily weighted
toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic
common stocks.
[Camera Ready Graph]
This chart assumes an initial investment of $10,000 made on 5/3/94 (commencement
of operations). Returns shown include deductions for management and other fund
expenses, and reinvestment of all dividends. Returns exclude deductions for
separate account sales loads and account fees. Past performance is not
predictive of future performance. Investment return and principal value will
fluctuate, so that your shares, when redeemed, may be worth more or less than
their original cost. Accumulation unit values, which reflect deduction of
charges for the separate account, are shown on page 10.
Average Annual Total Return
For Periods Ended December 31, 1995
<TABLE>
<CAPTION>
One Since
Year Inception*
---- ---------
<S> <C> <C> <C>
Growth Stock Portfolio 30.82% 18.63%
S&P 500 Index 37.40% 23.37%
*May 3, 1994 inception.
5/3/94 12/94 12/95
Growth Stock Portfolio $10,000 $10,155 $13,285
S&P 500 Index $10,000 $10,320 $14,180
</TABLE>
3
<PAGE> 7
GROWTH AND INCOME STOCK PORTFOLIO
During the second half, the Growth and Income Stock Portfolio
trailed the returns of the S&P 500 Index. Recent market trends have
not favored the portfolio's style of investing, with investors
currently focused on short-term earnings momentum rather than
long-term value. Gains in the overall market have tended to be
concentrated among relatively few companies. This portfolio is
broadly diversified, and should be well positioned to benefit when
the market again broadens out.
Stock selection, rather than industry sector rotation, continues to
be the major determinant of portfolio performance. The portfolio
maintained a fully invested position during the second half, with
cash averaging two to three percent of assets.
The Standard & Poor's 500 Composite Stock Price Index is an index of
unmanaged groups of 500 selected common stocks, most of which are
listed on the New York Stock Exchange. The index is heavily weighted
toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic
common stocks.
[Camera Ready Graph]
This chart assumes an initial investment of $10,000 made on 5/3/94 (commencement
of operations). Returns shown include deductions for management and other fund
expenses, and reinvestment of all dividends. Returns exclude deductions for
separate account sales loads and account fees. Past performance is not
predictive of future performance. Investment return and principal value will
fluctuate, so that your shares, when redeemed, may be worth more or less than
their original cost. Accumulation unit values, which reflect deduction of
charges for the separate account, are shown on page 10.
Average Annual Total Return
For Periods Ended December 31, 1995
<TABLE>
<CAPTION>
One Since
Year Inception*
---- ----------
<S> <C> <C> <C>
Growth and Income Stock Portfolio 31.12% 17.93%
S&P 500 Index 37.40% 23.37%
*May 3, 1994 inception.
5/3/94 12/94 12/95
Growth and Income Stock Portfolio $10,000 $10,034 $13,156
S&P 500 Index $10,000 $10,320 $14,180
</TABLE>
4
<PAGE> 8
AGGRESSIVE GROWTH STOCK PORTFOLIO
During 1995, the Aggressive Growth Portfolio experienced very strong
returns, in part because of its strategy in technology stocks. Even
though this industry had phenomenal performance during the first half
of the year, the Aggressive Growth Portfolio concentrated on the less
speculative issues in the sector. In the fourth quarter, when
technology stocks faced their biggest losses, this more conservative
approach benefited the portfolio.
Meanwhile, the portfolio's exposure to the health care and consumer
cyclical sectors increased somewhat, largely due to their improved
performance. Weightings in the utilities and basic materials sectors
declined through selective selling and relative underperformance. Cash
reached a fourth quarter low of five percent, ending the year at seven
percent.
Aggressive Growth investors may face increased volatility in the
upcoming year. If the markets level off or decline, there may be more
downside risk with smaller, less seasoned companies. However, stock
selection continues to be the primary focus of the portfolio.
Since the portfolio invests primarily in small capitalization issues,
the indices that best reflect the portfolio's performance are Wilshire
Next 1750 Index and Wilshire Small Cap Index.
The Wilshire Next 1750 is an unmanaged, equally weighted index.
Included in this index are those stocks which are ranked 750 to 2500 by
market capitalization in the Wilshire 5000. The largest sectors
represented in this index are financial services, consumer services and
basic industry. Its average market capitalization is approximately $515
million as of December 31, 1995.
[CAMERA READY GRAPH]
The Wilshire Small Cap Index is a subset of the Wilshire Next 1750 and includes
250 stocks chosen based upon their size, sector and liquidity characteristics.
Each stock is equally weighted in this unmanaged index. The average market
capitalization is approximately $620 million as of December 31, 1995. The
largest sector weightings include financial services, consumer services and
technology.
On May 3, 1994, the Northwestern Mutual Aggressive Growth Stock Fund, Inc. (the
"Fund") merged into the Northwestern Mutual Series Fund, Inc. Aggressive Growth
Stock Portfolio (the "Portfolio"). The Portfolio had no assets prior to the
merger. After the merger, the assets of the Portfolio were those of the Fund.
The investment objectives, policies, management and expenses of the Portfolio
are identical to those of the Fund. Accordingly, the performance of the Fund
prior to the merge is included with the performance of the Portfolio in the
graph and total return figures above.
This chart assumes an initial investment of $10,000 made on 11/30/90
(commencement of the Fund's operations). Returns shown include deductions for
management and other fund expenses, and reinvestment of all dividends. Returns
exclude deductions for separate account sales loads and account fees. Past
performance is not predictive of future performance. Investment return and
principal value will fluctuate, so that your shares, when redeemed, may be worth
more or less than their original cost. Accumulation unit values, which reflect
deduction of charges for the separate account, are shown on page 10.
Average Annual Total Return
For Periods Ended December 31, 1995
<TABLE>
<CAPTION>
One Five Since
Year Year Inception*
---- ---- ---------
<S> <C> <C> <C> <C>
Aggressive Growth Stock Portfolio 39.29% 23.65% 23.66%
Wilshire Small Cap 26.58% 20.28% 20.97%
Whilshire Next 1750 30.26% 21.08% 21.76%
*November 30, 1990 inception.
11/90 12/90 12/91 12/92
Aggressive Growth Stock Portfolio $10,000 $10,189 $15,894 $16,839
Wilshire Small Cap $10,000 $10,459 $15,873 $18,188
Whilshire Next 1750 $10,000 $10,459 $15,325 $18,040
12/93 12/94 12/95
Aggressive Growth Stock Portfolio $20,057 $21,141 $29,448
Wilshire Small Cap $21,464 $20,801 $26,330
Whilshire Next 1750 $21,186 $20,896 $27,219
</TABLE>
5
<PAGE> 9
INTERNATIONAL EQUITY PORTFOLIO
The second half proved to be a challenging investment period for the
global stock markets and for the International Equity Portfolio, as
well. Most foreign markets significantly underperformed versus the
US market, although returns were still positive. Moreover, the
strong performance of the US market attracted capital away from
overseas markets, further reinforcing these trends.
Portfolio strategy maintains a long-term investment horizon, and
seeks to identify the best values across all markets. This low
turnover approach resulted in relatively few changes in geographic
or industry sector weights. Cash dropped slightly to nine percent.
The portfolio continued to be heavily weighted in Europe and
underweighted in Japan, with some selective exposure to the emerging
markets.
The recent trends of sluggish foreign economic growth and low
inflation have prompted foreign central banks to begin lowering
interest rates to stimulate growth. This should bode well for the
portfolio in the months ahead.
[Camera Ready Graph]
As depicted in the graph, the International Equity Portfolio is compared against
the Morgan Stanley Capital International EAFE ("Europe-Australia-Far East")
Index. The index is composed of approximately 1100 companies in 20 countries in
Europe and the Pacific Basin. The objective of the index is to reflect the
movements of stock markets in these countries by representing an unmanaged
(indexed) portfolio within each country. The indices are constructed so that
companies chosen represent about 60% of market capitalization in each market,
industry composition of the market is reflected and a cross section of large,
medium, and small cap stocks is included taking into account liquidity concerns.
The index is calculated in U.S.$.
On May 3, 1994, the Northwestern Mutual International Equity Fund, Inc. (the
"Fund") merged into the Northwestern Mutual Series Fund, Inc. International
Equity Portfolio (the "Portfolio"). The Portfolio had no assets prior to the
merger. After the merger, the assets of the Portfolio were those of the Fund.
The investment objectives, policies, management and expenses of the Portfolio
are identical to those of the Fund. Accordingly, the performance of the Fund
prior to the merge is included with the performance of the Portfolio in the
graph and total return figures above.
This chart assumes an initial investment of $10,000 made on 4/30/93
(commencement of the Fund's operations). Returns shown include deductions for
management and other fund expenses, and reinvestment of all dividends. Returns
exclude deductions for separate account sales loads and account fees. Past
performance is not predictive of future performance. Investment return and
principal value will fluctuate, so that your shares, when redeemed, may be worth
more or less than their original cost. Accumulation unit values, which reflect
deduction of charges for the separate account, are shown on page 10.
Average Annual Total Return
For Periods Ended December 31, 1995
<TABLE>
<CAPTION>
One Since
Year Inception*
---- ---------
<S> <C> <C> <C> <C>
International Equity Stock Portfolio 14.57% 14.23%
EAFE 11.55% 11.04%
*April 30, 1993 inception.
4/93 12/93 12/94 12/95
International Equity Stock Portfolio $10,000 $12,464 $12,451 $14,266
EAFE $10,000 $10,970 $11,859 $13,228
</TABLE>
6
<PAGE> 10
SELECT BOND PORTFOLIO
After a brief rise in interest rates early in the summer, the bond
market continued its powerful rally. This was due to a combination
of weakening economic growth, falling inflation and optimism
involving a balanced budget from Washington. Two-year Treasury rates
fell from 5.79 percent to 5.15 percent, while 30-year Treasury rates
fell 65 basis points to 5.95 percent.
The portfolio's average maturity was lengthened as long rates
approached seven percent during the summer, benefiting from the
subsequent rally that took long rates below six percent. This
strategy was in anticipation of progress in Washington, and the
expected enthusiasm for bonds. The portfolio maintained a large
weighting in corporate bonds, with an economy that is producing
excellent corporate cash flow and improving credit quality. This was
the best performing bond market sector for the second half, as well
as the entire year. The portfolio weightings at year-end were 13
percent cash, 15 percent Treasurys, 21 percent mortgages and 51
percent corporates.
[Camera Ready Graph]
Since the portfolio invests broadly in U.S. Government, mortgage and corporate
bonds, the graph depicts an appropriate comparison to the Merrill Lynch Domestic
Master Index. The index is an unmanaged market value weighted index comprised of
U.S. Government, mortgage and investment-grade corporate bonds. The index
measures the income provided by, and the price changes of, the underlying
securities.
This chart assumes an initial investment of $10,000 made on 12/31/85. Returns
shown include deductions for management and other fund expenses, and
reinvestment of all dividends. Returns exclude deductions for separate account
sales loads and account fees. Past performance is not predictive of future
performance. Investment return and principal value will fluctuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
Accumulation unit values, which reflect deduction of charges for the separate
account, are shown on page 10.
Average Annual Total Return
For Periods Ended December 31, 1995
<TABLE>
<CAPTION>
One Five Ten
Year Years Years
---- ----- -----
<S> <C> <C> <C> <C> <C> <C>
Select Bond Portfolio 19.10% 10.27% 9.84%
Merrill Lynch Domestic Master Index 18.46% 9.56% 9.63%
12/85 12/86 12/87 12/88 12/89
Select Bond Portfolio $10,000 $11,868 $11,743 $12,708 $14,507
Merrill Lynch Domestic Master Index $10,000 $11,522 $11,799 $12,747 $14,555
12/90 12/91 12/92 12/93 12/94 12/95
Select Bond Portfolio $15,682 $18,399 $19,824 $21,967 $21,465 $25,564
Merrill Lynch Domestic Master Index $15,880 $18,398 $19,792 $21,776 $21,161 $25,068
</TABLE>
7
<PAGE> 11
HIGH YIELD BOND PORTFOLIO
High yield market returns lagged the investment grade bond market
during the second half of the year. It is not unusual for the high
yield market to underperform in a bond market rally since the high
yield market is less sensitive to changes in the general level of
interest rates.
The high yield market finished 1995 on a cautious note as a result
of concerns about an economic slowdown and an uptick in defaults.
Although defaults are up and the credit cycle is maturing, an
imminent resurgence in default rates to the levels seen in the late
1980s is not expected.
The High Yield Bond Portfolio adopted a more defensive posture in
the second half of the year in anticipation of slower economic
growth. Sector weights were reduced in cyclical sectors such as home
building, steel and auto-related industries. At year end, the top
industry sector weights were in stable industries, including
cable/telecommunications, gaming and retail-food. The average yield
on the portfolio was approximately 11.15 percent, the average
maturity was just over eight years. The portfolio was fully invested
with a cash position of about 2.2 percent.
The total return performance for the High Yield Bond Portfolio is
shown in comparison with the Salomon Brothers High Yield Market
Index and the Lehman Brothers High Yield Intermediate Market Index.
The Lehman Brothers index is thought to be a better measure of
portfolio performance since it has a quality and maturity profile
that more closely resembles the High Yield Bond Portfolio.
[Camera Ready Graph]
The Salomon Brothers High Yield Market Index includes cash-pay and
deferred-interest corporate bonds with remaining maturities of at least one
year. All bonds in the index are publicly placed, have a fixed coupon and are
non-convertible. Bonds issued under Rule 144A are added after the issuer has
registered the security with the Securities and Exchange Commission. The index
is an unmanaged market value weighted index and measures the income provided by,
and the price changes of, the underlying securities.
The Lehman Brothers High Yield Intermediate Market Index is made up of dollar
denominated, nonconvertible, SEC publicly registered fixed rate noninvestment
grade issues. The bonds will have remaining maturities of between one and ten
years and have an outstanding par value of at least $100 million. Yankee and
global bonds (SEC registered) of issuers in G-7 countries are included. Original
issue zeroes and step-up coupon structures are also included, however, the index
excludes pay-in-kind (PIK) bonds. Each bond must be rated Ba1 or lower by
Moody's Investor Service. If a Moody's rating is unavailable, the bonds must be
rated BB+ or lower by Standard & Poor's, or by Fitch if an S&P rating is
unavailable. A small number of unrated bonds are included in the index; to be
eligible they must have previously held a high yield rating or have been
associated with a high yield issuer. The index is an unmanaged market value
weighted index and measures the income provided by, and the price changes of,
the underlying securities.
This chart assumes an initial investment of $10,000 made on 5/3/94 (commencement
of operations). Returns shown include deductions for management and other fund
expenses, and reinvestment of all dividends. Returns exclude deductions for
separate account sales loads and account fees. Past performance is not
predictive of future performance. Investment return and principal value will
fluctuate, so that your shares, when redeemed, may be worth more or less than
their original cost. Accumulation unit values, which reflect deduction of
charges for the separate account, are shown on page 10.
Average Annual Total Return
For Periods Ended December 31, 1995
<TABLE>
<CAPTION>
One Since
Year Inception*
---- ---------
<S> <C> <C> <C>
High Yield Bond Portfolio 16.78% 11.76%
Salomon Brothers High Yield Market Index 19.71% 12.62%
Lehman Brothers High Yield
Intermediate Market Index 17.32% 11.32%
*May 3, 1994 inception.
5/3/94 12/94 12/95
High Yield Bond Portfolio $10,000 $10,302 $12,030
Salomon Brothers High Yield Market Index $10,000 $10,179 $12,185
Lehman Brothers High Yield
Intermediate Market Index $10,000 $10,188 $11,952
</TABLE>
8
<PAGE> 12
MONEY MARKET PORTFOLIO
Money market rates fell about 50 basis points during the period, reflecting the
December rate cut by the Federal Reserve and expectations of further easing in
early 1996. The consensus forecast is that short term rates will fall
substantially in the first half of the year. As a result, investors have been
willing to accept lower yields to extend maturities and lock in these rates
relative to purchasing shorter maturity investments.
The Money Market Portfolio maintained an average maturity shorter than the broad
universe of money market funds. This is due to the belief that the Fed will be
cautious about lowering rates, and that the market is overly optimistic about
the extent of future rate cuts.
Accumulation unit values, which reflect deduction of charges for the separate
account, are shown on page 10.
BALANCED PORTFOLIO
Benefiting from a relatively fully invested position and an
aggressively structured bond portfolio, the fund was able to take
advantage of the positive trends in the stock and bond markets. As
of year end, the asset mix in the Balanced Portfolio was 54 percent
stocks, 35 percent bonds, with cash at 11 percent of the portfolio.
The asset mix remained fairly steady for most of the period,
although there were some modest shifts between stocks and bonds to
take advantage of market opportunities. The stock market
significantly outperformed other asset categories and we continue to
favor equities over fixed income investments. The portfolio's heavy
weighting in corporate bonds presumes little risk of a recession
this year.
The Federal Reserve Board's current stance on easing monetary policy
appears to bode well for the financial markets, at least in the near
term. The portfolio is positioned to benefit from a further rise in
the stock and bond markets. However, any change in the recent
favorable trends, such as higher inflation or interest rates, would
trigger a less aggressive asset mix in the portfolio.
In the graph, the portfolio is compared against three indices
representing the three major components of the portfolio: equities,
fixed income and cash equivalent investments.
The Merrill Lynch Domestic Master Index is an unmanaged market value
weighted index comprised of U.S. Government, mortgage and
investment-grade corporate bonds. The index measures the income
provided by, and the price changes of, the underlying securities.
[Camera Ready Graph]
The Standard & Poor's 500 Composite Stock Price Index is an index of unmanaged
groups of 500 selected common stocks, most of which are listed on the New York
Stock Exchange. The index is heavily weighted toward stocks with large market
capitalizations and represents approximately two-thirds of the total market
value of all domestic common stocks.
This chart assumes an initial investment of $10,000 made on 12/31/85. Returns
shown include deductions for management and other fund expenses, and
reinvestment of all dividends. Returns exclude deductions for separate account
sales loads and account fees. Past performance is not predictive of future
performance. Investment return and principal value will fluctuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
Accumulation unit values, which reflect deduction of charges for the separate
account, are shown on page 10.
Average Annual Total Return
For Periods Ended December 31, 1995
<TABLE>
<CAPTION>
One Five Ten
Year Years Years
---- ----- -----
<S> <C> <C> <C> <C> <C> <C>
Balanced Portfolio 26.39% 12.63% 11.17%
S&P 500 Index 37.40% 16.54% 14.83%
Merrill Lynch Domestic Master Index 18.46% 9.56% 9.63%
Merrill Lynch 91-Day Treasury Bill 6.03% 4.74% 6.14%
12/85 12/86 12/87 12/88 12/89
Balanced Portfolio $10,000 $11,696 $12,532 $13,544 $15,665
S&P 500 Index $10,000 $11,860 $12,465 $14,534 $19,141
Merrill Lynch Domestic Master Index $10,000 $11,522 $11,799 $12,747 $14,555
Merrill Lynch 91-Day Treasury Bill $10,000 $10,675 $11,393 $12,182 $13,277
12/90 12/91 12/92 12/93 12/94 12/95
Balanced Portfolio $15,904 $19,615 $20,716 $22,768 $22,805 $28,823
S&P 500 Index $18,548 $24,205 $26,045 $28,675 $29,019 $39,872
Merrill Lynch Domestic Master Index $15,880 $18,398 $19,792 $21,776 $21,161 $25,068
Merrill Lynch 91-Day Treasury Bill $14,395 $15,314 $15,915 $16,423 $17,111 $18,143
</TABLE>
9
<PAGE> 13
ACCOUNT B
The annual report of Northwestern Mutual Series Fund Inc., is included because
all payments to Account B are invested in one or more Portfolios of this Fund.
The Series Fund is a mutual fund currently offering shares only to The
Northwestern Mutual Life Insurance Company and its separate investment accounts.
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
/s/ JAMES D. ERICSON
James D. Ericson, President and C.E.O.
NML VARIABLE ANNUITY ACCOUNT B
ACCUMULATION UNIT VALUES
<TABLE>
<CAPTION>
CONTRACTS ISSUED
CONTRACTS ISSUED ON OR AFTER DECEMBER 17, 1981
BEFORE DECEMBER 17, 1981 AND BEFORE MARCH 31, 1995
-------------------------------- --------------------------------
DIVISION 12/31/94 12/31/95 % CHANGE 12/31/94 12/31/95 % CHANGE
- ------------------------------------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Index 500 Stock............................ $1.530 $2.084 36.23% $1.499 $2.032 35.56%
Growth Stock............................... 1.009 1.311 29.85% 1.006 1.300 29.20%
Growth and Income Stock.................... 0.997 1.298 30.15% 0.994 1.287 29.50%
Aggressive Growth Stock.................... 2.042 2.824 38.26% 2.001 2.753 37.57%
International Equity....................... 1.230 1.398 13.72% 1.220 1.380 13.16%
Select Bond................................ 5.569 6.583 18.21% 5.217 6.137 17.62%
High Yield Bond............................ 1.025 1.188 15.91% 1.022 1.178 15.33%
Money Market............................... 2.206 2.317 5.04% 2.067 2.161 4.51%
Balanced................................... 3.685 4.623 25.45% 3.453 4.311 24.83%
</TABLE>
<TABLE>
<CAPTION>
CONTRACTS ISSUED CONTRACTS ISSUED
ON OR AFTER MARCH 31, 1995 ON OR AFTER MARCH 31, 1995
FRONT LOAD VERSION BACK LOAD VERSION
------------------------------- -------------------------------
DIVISION 3/31/95 12/31/95 % CHANGE 3/31/95 12/31/95 % CHANGE
- --------------------------------------------- ------- -------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Index 500 Stock.............................. $1.000 $1.249 24.91% $1.637 $2.032 24.12%
Growth Stock................................. 1.000 1.209 20.87% 1.082 1.300 20.11%
Growth and Income Stock...................... 1.000 1.197 19.66% 1.083 1.287 18.91%
Aggressive Growth Stock...................... 1.000 1.305 30.52% 2.123 2.753 29.70%
International Equity......................... 1.000 1.140 14.04% 1.218 1.380 13.32%
Select Bond.................................. 1.000 1.129 12.88% 5.471 6.137 12.16%
High Yield Bond.............................. 1.000 1.112 11.16% 1.067 1.178 10.46%
Money Market................................. 1.000 1.040 4.01% 2.090 2.161 3.35%
Balanced..................................... 1.000 1.181 18.10% 3.673 4.311 17.35%
</TABLE>
Note: Accumulation Unit Values are rounded to the nearest one-thousandth.
AN INVESTMENT IN THE MONEY MARKET PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY
THE U.S. GOVERNMENT AND THERE CAN BE NO ASSURANCE THAT THE PORTFOLIO WILL BE
ABLE TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
Note: "Standard and Poor's 500" and "S&P 500(R)" are trademarks of McGraw-Hill,
Inc. and have been licensed for use by The Northwestern Mutual Life
Insurance Company. The Series Funds and its Portfolios are not sponsored,
endorsed, sold or promoted by Standard & Poor's, and Standard & Poor's
makes no representation regarding the advisability of investing in them.
10
<PAGE> 14
[PRICE WATERHOUSE LLP LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
To The Northwestern Mutual Life Insurance Company and
Contract Owners of NML Variable Annuity Account B
In our opinion, the accompanying combined statement of assets and liabilities
and the related combined and separate statements of operations and changes in
equity present fairly, in all material respects, the financial position of NML
Variable Annuity Account B and the Index 500 Stock Division, Growth Stock
Division, Growth and Income Stock Division, Aggressive Growth Stock Division,
International Equity Division, Select Bond Division, High Yield Bond Division,
Money Market Division and the Balanced Division thereof at December 31, 1995,
the results of their operations and the changes in their equity for the year
then ended and for each of the other periods presented, in conformity with
generally accepted accounting principles. These financial statements are the
responsibility of The Northwestern Mutual Life Insurance Company's management;
our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these financial statements in
accordance with generally accepted auditing standards which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included direct confirmation of the number of
shares owned at December 31, 1995 with Northwestern Mutual Series Fund, Inc.,
provide a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
Milwaukee, Wisconsin
January 24, 1996
11
<PAGE> 15
-------------
THIS PAGE INTENTIONALLY
LEFT BLANK
-------------
12
<PAGE> 16
NML VARIABLE ANNUITY ACCOUNT B
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
(IN THOUSANDS)
<TABLE>
<S> <C> <C>
ASSETS
Investments at Market Value:
Northwestern Mutual Series Fund, Inc.
Index 500 Stock
192,606 shares (cost $235,821)................................................. $ 331,668
Growth Stock
31,686 shares (cost $34,812)................................................... 40,020
Growth and Income Stock
68,480 shares (cost $73,990)................................................... 82,930
Aggressive Growth Stock
160,593 shares (cost $292,831)................................................. 444,521
International Equity
196,171 shares (cost $236,830)................................................. 265,812
Select Bond
123,243 shares (cost $142,109)................................................. 151,342
High Yield Bond
20,490 shares (cost $21,289)................................................... 21,023
Money Market
94,788 shares (cost $94,788)................................................... 94,788
Balanced
1,000,506 shares (cost $1,314,318)............................................. 1,604,811.. $3,036,915
----------
Due from Sale of Fund Shares...................................................................... 1,597
Due from Northwestern Mutual Life Insurance Company............................................... 42
----------
Total Assets............................................................................... $3,038,554
=========
LIABILITIES
Due to Participants............................................................................... $ 2,315
Due to Northwestern Mutual Life Insurance Company................................................. 1,597
Due on Purchase of Fund Shares.................................................................... 42
----------
Total Liabilities.......................................................................... 3,954
----------
EQUITY (NOTE 8)
Contracts Issued Prior to December 17, 1981....................................................... 84,729
Contracts Issued On or After December 17, 1981 and Before March 31, 1995.......................... 2,785,432
Contracts Issued On or After March 31, 1995:
Front Load Version.............................................................................. 41,147
Back Load Version............................................................................... 123,292
----------
Total Equity............................................................................... 3,034,600
----------
Total Liabilities and Equity............................................................... $3,038,554
=========
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
13
<PAGE> 17
NML VARIABLE ANNUITY ACCOUNT B
STATEMENT OF OPERATIONS AND CHANGES IN EQUITY
(IN THOUSANDS)
<TABLE>
<CAPTION>
INDEX 500
COMBINED STOCK DIVISION GROWTH STOCK DIVISION#
--------------------------- ----------------------- ----------------------------
EIGHT MONTHS
YEAR ENDED YEAR ENDED YEAR ENDED ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
--------------------------- ----------------------- ------------ ------------
1995 1994 1995 1994 1995 1994
---------- ---------- -------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Dividend Income........................ $ 68,372 $ 219,223 $ 2,545 $ 9,672 $ 1,227 $ 165
Annuity Rate and Expense Guarantees.... 31,745 26,109 3,096 2,324 297 52
---------- ---------- -------- -------- ------- -------
Net Investment Income (Loss)........... 36,627 193,114 (551) 7,348 930 113
---------- ---------- -------- -------- ------- -------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Realized Gain on Investments........... 6,751 17,722 432 534 45 --
Unrealized Appreciation (Depreciation)
of
Investments During the Year.......... 541,786 (226,913) 78,497 (7,574) 5,346 (138)
---------- ---------- -------- -------- ------- -------
Net Gain (Loss) on Investments......... 548,537 (209,191) 78,929 (7,040) 5,391 (138)
---------- ---------- -------- -------- ------- -------
Increase (Decrease) in Equity Derived
from Investment Activity............. 585,164 (16,077) 78,378 308 6,321 (25)
---------- ---------- -------- -------- ------- -------
EQUITY TRANSACTIONS
Contract Owners' Net Payments.......... 376,570 389,478 46,603 37,543 12,987 4,757
Annuity Payments....................... (5,967) (4,241) (530) (476) (21) (1)
Surrenders and Other (net)............. (155,370) (121,978) (12,558) (8,669) (588) (85)
Transfers from Other Divisions......... 223,928 254,710 28,379 16,836 10,958 7,898
Transfers to Other Divisions........... (223,928) (254,710) (13,997) (26,080) (2,028) (187)
---------- ---------- -------- -------- ------- -------
Increase (Decrease) in Equity Derived
from Equity Transactions............... 215,233 263,259 47,897 19,154 21,308 12,382
---------- ---------- -------- -------- ------- -------
Net Increase (Decrease) in Equity........ 800,397 247,182 126,275 19,462 27,629 12,357
Equity
Beginning of Year...................... 2,234,203 1,987,021 205,214 185,752 12,357 0
---------- ---------- -------- -------- ------- -------
End of Year............................ $3,034,600 $2,234,203 $331,489 $205,214 $ 39,986 $ 12,357
========== ========== ======== ======== ======= =======
</TABLE>
# The initial investments in the Growth Stock and Growth and Income Stock
Divisions were made on May 3, 1994.
The Accompanying Notes are an Integral Part of the Financial Statements
14
<PAGE> 18
NML VARIABLE ANNUITY ACCOUNT B
STATEMENT OF OPERATIONS AND CHANGES IN EQUITY
(IN THOUSANDS)
<TABLE>
<CAPTION>
GROWTH & INCOME AGGRESSIVE GROWTH INTERNATIONAL EQUITY
STOCK DIVISION# STOCK DIVISION DIVISION SELECT BOND DIVISION
----------------------------- --------------------- --------------------- ---------------------
EIGHT MONTHS
YEAR ENDED ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
------------ ------------ --------------------- --------------------- ---------------------
1995 1994 1995 1994 1995 1994 1995 1994
------------ ------------ -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 4,879 $ 513 $ 1,785 $ 1,607 $ 1,696 $ 6,775 $ 3,550 $ 16,145
672 132 4,157 2,503 3,029 2,224 1,593 1,513
------- ------- -------- -------- -------- -------- -------- --------
4,207 381 (2,372) (896) (1,333) 4,551 1,957 14,632
------- ------- -------- -------- -------- -------- -------- --------
33 -- 1,461 297 3,333 96 437 1,449
9,759 (820) 111,310 10,133 28,381 (9,711) 19,053 (21,331)
------- ------- -------- -------- -------- -------- -------- --------
9,792 (820) 112,771 10,430 31,714 (9,615) 19,490 (19,882)
------- ------- -------- -------- -------- -------- -------- --------
13,999 (439) 110,399 9,534 30,381 (5,064) 21,447 (5,250)
------- ------- -------- -------- -------- -------- -------- --------
25,211 12,083 66,252 61,047 39,604 76,394 20,089 25,069
(53) (5) (236) (114) (214) (120) (297) (382)
(1,653) (579) (14,041) (6,864) (12,919) (5,559) (9,328) (9,838)
18,619 21,072 54,585 51,753 21,883 86,072 11,189 7,671
(4,649) (534) (23,879) (15,127) (45,059) (14,282) (10,352) (30,044)
------- ------- -------- -------- -------- -------- -------- --------
37,475 32,037 82,681 90,695 3,295 142,505 11,301 (7,524)
------- ------- -------- -------- -------- -------- -------- --------
51,474 31,598 193,080 100,229 33,676 137,441 32,748 (12,774)
31,598 0 251,206 150,977 231,900 94,459 118,116 130,890
------- ------- -------- -------- -------- -------- -------- --------
$ 83,072 $ 31,598 $444,286 $251,206 $265,576 $231,900 $150,864 $118,116
======= ======= ======== ======== ======== ======== ======== ========
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
15
<PAGE> 19
NML VARIABLE ANNUITY ACCOUNT B
STATEMENT OF OPERATIONS AND CHANGES IN EQUITY (CONTINUED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
MONEY MARKET
HIGH YIELD BOND DIVISION# DIVISION BALANCED DIVISION
-------------------------- ------------------- -----------------------
EIGHT MONTHS
YEAR ENDED ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
------------ ------------ ------------------- -----------------------
1995 1994 1995 1994 1995 1994
------------ ------------ -------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Dividend Income........................... $ 1,763 $ 408 $ 4,468 2,486 $ 46,459 $ 181,452
Annuity Rate and Expense Guarantees....... 160 35 920 750 17,821 16,576
------- ------ ------- ------- ---------- ----------
Net Investment Income..................... 1,603 373 3,548 1,736 28,638 164,876
------- ------ ------- ------- ---------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Realized Gain on Investments.............. 27 14 -- -- 983 15,332
Unrealized Appreciation (Depreciation) of
Investments During the Year............. 67 (333) -- -- 289,373 (197,139)
------- ------ ------- ------- ---------- ----------
Net Gain (Loss) on Investments............ 94 (319) 0 0 290,356 (181,807)
------- ------ ------- ------- ---------- ----------
Increase (Decrease) in Equity Derived from
Investment Activity..................... 1,697 54 3,548 1,736 318,994 (16,931)
------- ------ ------- ------- ---------- ----------
EQUITY TRANSACTIONS
Contract Owners' Net Payments............. 8,070 3,137 43,673 35,360 114,081 134,088
Annuity Payments.......................... (10) (2) (55) (54) (4,551) (3,087)
Surrenders and Other (net)................ (495) (245) (14,173) (11,859) (89,615) (78,280)
Transfers from Other Divisions............ 7,206 5,400 44,923 37,145 26,186 20,863
Transfers to Other Divisions.............. (2,984) (882) (51,807) (46,086) (69,173) (121,488)
------- ------ ------- ------- ---------- ----------
Increase (Decrease) in Equity Derived from
Equity Transactions....................... 11,787 7,408 22,561 14,506 (23,072) (47,904)
------- ------ ------- ------- ---------- ----------
Net Increase (Decrease) in Equity........... 13,484 7,462 26,109 16,242 295,922 (64,835)
Equity
Beginning of Year......................... 7,462 0 68,690 52,448 1,307,660 1,372,495
------- ------ ------- ------- ---------- ----------
End of Year............................... $ 20,946 $7,462 $ 94,799 $ 68,690 $1,603,582 $1,307,660
======= ====== ======= ======= ========== ==========
</TABLE>
# The initial investment in the High Yield Bond Division was made on May 3,
1994.
The Accompanying Notes are an Integral Part of the Financial Statements
16
<PAGE> 20
NML VARIABLE ANNUITY ACCOUNT B
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
Note 1 -- NML Variable Annuity Account B (the "Account") is registered as a unit
investment trust under the Investment Company Act of 1940 and is a segregated
asset account of The Northwestern Mutual Life Insurance Company ("Northwestern
Mutual Life") used to fund variable annuity contracts ("contracts") for
tax-deferred annuities, individual retirement annuities and non-qualified plans.
Beginning March 31, 1995, two versions of the contract are offered: Front Load
contracts with a sales charge up to 4% of purchase payments and Back Load
contracts with a withdrawal charge of 0-8%.
Note 2 -- The preparation of the 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. Principal
accounting policies are summarized below.
Note 3 -- All assets of each Division of the Account are invested in shares of
the corresponding Portfolio of Northwestern Mutual Series Fund, Inc. (the
"Fund"). The shares are valued at the Fund's offering and redemption price per
share.
The Fund is an open-end investment company registered under the Investment
Company Act of 1940.
Note 4 -- Annuity reserves are based on published annuity tables with age
adjustment and benefit payments which reflect actual investment experience. For
variable payment plans issued prior to January 1, 1974, annuity reserves are
based on the 1955 American Annuity Table with assumed interest rates of 3%,
3 1/2% or 5%. For variable payment plans issued on or after January 1, 1974 and
before January 1, 1985, annuity reserves are based on the 1971 Individual
Annuity Table with assumed interest rates of 3 1/2% or 5%. For variable payment
plans issued on or after January 1, 1985, annuity reserves are based on the 1983
Table a with assumed interest rates of 3 1/2% or 5%.
Note 5 -- Dividend income from the Fund is recorded on the record date of the
dividends. Transactions in Fund shares are accounted for on the trade date. The
basis for determining cost on sale of Fund shares is identified cost. Purchases
and sales of Fund shares for the year ended December 31, 1995 by each Division
are shown below:
<TABLE>
<CAPTION>
PURCHASES SALES
----------- -----------
<S> <C> <C>
Index 500 Stock
Division................ $50,922,535 $ 3,468,239
Growth Stock Division..... 22,485,739 226,562
Growth & Income Stock
Division................ 41,821,280 248,160
Aggressive Growth
Division................ 83,439,869 3,039,573
International Equity
Division................ 20,603,579 18,479,409
Select Bond Division...... 18,844,321 5,365,077
High Yield Bond
Division................ 14,337,033 880,429
Money Market Division..... 50,987,420 24,992,483
Balanced Division......... 77,356,455 71,676,703
</TABLE>
Note 6 -- A deduction for annuity rate and expense guarantees is determined
daily and paid to Northwestern Mutual Life as compensation for assuming the risk
that annuity payments will continue for longer periods than anticipated because
the annuitants as a group live longer than expected, and the risk that the
charges made by Northwestern Mutual Life may be insufficient to cover the actual
costs incurred in connection with the contracts.
For contracts issued on or after March 31, 1995, for the Front Load version and
the Back Load version, the deduction for annuity rate and expense guarantees is
determined daily at annual rates of 4/10 of 1% and 1 1/4%, respectively, of the
net assets of each Division attributable to these contracts and is paid to
Northwestern Mutual Life. For these contracts, the rates may be increased or
decreased by the Board of Trustees of Northwestern Mutual Life not to exceed
3/4 of 1% and 1 1/2%, respectively.
Generally, for contracts issued on or after December 17, 1981, and before March
31, 1995, the deduction is at an annual rate of 1 1/4% of the net assets of each
Division attributable to these contracts. For these contracts, the rate may be
increased or decreased by the Board of Trustees of Northwestern Mutual Life not
to exceed a 1 1/2% annual rate.
Generally, for contracts issued prior to December 17, 1981, the deduction is at
an annual rate of 3/4 of 1% of the net assets of each Division attributable to
these contracts. For these contracts, the rate may be increased or decreased by
the Board of Trustees of Northwestern Mutual Life not to exceed a 1% annual
rate.
Beginning in 1995, Northwestern Mutual Life paid a dividend to certain
contracts. The dividend was reinvested in the Account and has been reflected as
a Contract Owners' Net Payment in the accompanying financial statements.
Note 7 -- Northwestern Mutual Life is taxed as a "life insurance company" under
the Internal Revenue Code and the operations of the Account form a part of and
are taxed with those of Northwestern Mutual Life. Currently, no charges for
taxes have been made by Northwestern Mutual Life to the Account. Accordingly, no
provision for any such liability has been made.
17
<PAGE> 21
NML VARIABLE ANNUITY ACCOUNT B
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
(IN THOUSANDS)
Note 8 -- Equity Values by Division are shown below:
<TABLE>
<CAPTION>
CONTRACTS ISSUED:
CONTRACTS ISSUED: ON OR AFTER DECEMBER 17, 1981 AND
BEFORE DECEMBER 17, 1981 BEFORE MARCH 31, 1995
---------------------------------- ---------------------------------------
ACCUMULATION UNITS ACCUMULATION UNITS
DIVISION UNIT VALUE OUTSTANDING EQUITY UNIT VALUE OUTSTANDING EQUITY
- ------------------------------------ ------------ ----------- ------- ------------ ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Index 500 Stock..................... $ 2.084065 13,256 $27,626 $ 2.031929 134,819 $ 273,941
Growth Stock........................ 1.310823 19 25 1.299976 24,828 32,276
Growth and Income Stock............. 1.298065 33 42 1.287355 52,866 68,058
Aggressive Growth Stock............. 2.823905 1,618 4,569 2.753170 147,961 407,361
International Equity................ 1.398467 2,141 2,995 1.379966 179,261 247,374
Select Bond......................... 6.583140 1,364 8,983 6.136911 21,049 129,175
High Yield Bond..................... 1.188188 59 70 1.178371 13,474 15,878
Money Market........................ 2.317213 1,358 3,147 2.160533 34,041 73,546
Balanced............................ 4.622931 7,328 33,872 4.310821 347,996 1,500,148
------- ----------
Equity............................ 81,329 2,747,757
Annuity Reserves.................. 3,400 37,675
------- ----------
Total Equity...................... $84,729 $2,785,432
======== ==========
</TABLE>
<TABLE>
<CAPTION>
CONTRACTS ISSUED: CONTRACTS ISSUED:
ON OR AFTER MARCH 31, 1995 ON OR AFTER MARCH 31, 1995
FRONT LOAD VERSION BACK LOAD VERSION
---------------------------------- ---------------------------------------
ACCUMULATION UNITS ACCUMULATION UNITS
DIVISION UNIT VALUE OUTSTANDING EQUITY UNIT VALUE OUTSTANDING EQUITY
- ------------------------------------ ------------ ----------- ------- ------------ ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Index 500 Stock..................... $ 1.249114 4,356 $ 5,441 $ 2.031929 9,221 $ 18,736
Growth Stock........................ 1.208718 1,715 2,073 1.299976 3,952 5,138
Growth and Income Stock............. 1.196596 3,530 4,224 1.287355 7,514 9,674
Aggressive Growth Stock............. 1.305186 5,338 6,967 2.753170 8,294 22,835
International Equity................ 1.140398 2,784 3,175 1.379966 7,214 9,956
Select Bond......................... 1.128765 1,883 2,126 6.136911 1,292 7,930
High Yield Bond..................... 1.111614 1,418 1,577 1.178371 2,701 3,182
Money Market........................ 1.040089 5,949 6,187 2.160533 5,318 11,490
Balanced............................ 1.180953 6,897 8,145 4.310821 7,689 33,144
------- ----------
Equity............................ 39,915 122,085
Annuity Reserves.................. 1,232 1,207
------- ----------
Total Equity...................... $41,147 $ 123,292
======== ==========
</TABLE>
18
<PAGE> 22
Price Waterhouse LLP Letterhead
REPORT OF INDEPENDENT ACCOUNTANTS
To The Shareholders and Board of Directors of
Northwestern Mutual Series Fund, Inc.
In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the Index 500 Stock Portfolio,
Growth Stock Portfolio, Growth and Income Stock Portfolio, Aggressive Growth
Stock Portfolio, International Equity Portfolio, Select Bond Portfolio, High
Yield Bond Portfolio, Money Market Portfolio and Balanced Portfolio
(constituting Northwestern Mutual Series Fund, Inc., hereafter referred to as
the "Fund") at December 31, 1995, the results of each of their operations for
the year then ended, the changes in each of their net assets for the year ended
December 31, 1995, and for the other periods indicated, and the financial
highlights for the year ended December 31, 1995 and the other periods indicated,
in conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Fund's management; our responsibility
is to express an opinion on these financial statements based on our audits. We
conducted our audits of these financial statements in accordance with generally
accepted auditing standards which require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at December 31, 1995 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above.
Price Waterhouse LLP
Milwaukee, Wisconsin
January 26, 1996
19
<PAGE> 23
FINANCIAL STATEMENTS OF
NORTHWESTERN MUTUAL SERIES FUND, INC.
INDEX 500 STOCK PORTFOLIO
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<S> <C>
ASSETS
Common Stocks
(cost $341,451).................. $ 464,866
Money Market Investments
(cost $29,316)................... 29,316
Preferred Stock
(cost $1)........................ 3
--------
494,185
Cash................................ 114
Dividends and Interest Receivable... 851
Due from Sale of Fund Shares........ 167
Futures Variation Margin............ 34
--------
Total Assets................... 495,351
--------
LIABILITIES
Due on Redemption of Fund Shares.... 113
Due to Investment Advisor........... 84
Accrued Expenses.................... 21
--------
Total Liabilities.............. 218
--------
NET ASSETS............................ $ 495,133
========
REPRESENTED BY:
Aggregate Paid in Capital
(500,000 shares authorized,
$.01 par value; 287,518
shares outstanding).............. $ 355,506
Undistributed Net Investment
Income........................... 6,192
Undistributed Accumulated Net
Realized Gain on Investments..... 9,270
Net Unrealized Appreciation of:
Investment Securities............ 123,417
Index Futures Contracts.......... 748
--------
Net Assets for 287,518 Shares
Outstanding...................... $ 495,133
========
Net Asset Value, Offering and
Redemption Price per Share....... $1.72
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME
Income
Dividends (less foreign dividend
tax of $61).................... $ 9,533
Interest......................... 1,330
Other Income..................... 2
--------
Total Income................... 10,865
--------
Expenses
Management Fees.................. 804
Custodian Fees................... 55
Other Expenses................... 40
--------
Total Expenses................. 899
--------
Less Custodian Fees Paid by
Affiliate................. (55)
--------
Total Net Expenses............. 844
--------
Net Investment Income............... 10,021
--------
REALIZED AND UNREALIZED
GAIN ON INVESTMENTS
Net Realized Gain on Investments:
Investment Securities............ 3,843
Index Futures Contracts.......... 5,069
--------
Net Realized Gain on
Investments for the Year.... 8,912
--------
Net Change in Unrealized
Appreciation of:
Investment Securities............ 104,677
Index Futures Contracts.......... 791
--------
Net Change in Unrealized
Appreciation of Investments
for the Year................ 105,468
--------
Net Gain on Investments............. 114,380
--------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS........ $ 124,401
========
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
20
<PAGE> 24
NORTHWESTERN MUTUAL SERIES FUND, INC.
INDEX 500 STOCK PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS
ENDED DECEMBER 31,
--------------------
1995 1994
-------- --------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations
Net Investment Income...................................................... $ 10,021 $ 6,330
Net Realized Gain on Investments........................................... 8,912 2,961
Net Change in Unrealized Appreciation of Investments....................... 105,468 389
-------- --------
Net Increase in Net Assets Resulting from Operations..................... 124,401 9,680
-------- --------
Dividends to Shareholders from:
Net Investment Income...................................................... (3,894) (6,269)
Net Realized Gain on Investments........................................... -- (2,586)
-------- --------
Net Decrease in Net Assets Resulting from Dividends to Shareholders...... (3,894) (8,855)
-------- --------
Fund Share Transactions
Proceeds from Sale of 47,195 and 19,955 Shares............................. 72,382 25,556
Proceeds from Sale of 220,158 Shares Issued in Acquisition of Northwestern
Mutual Index 500 Stock Fund, Inc. ....................................... -- 277,484
Proceeds from Shares Issued on Reinvestment of Dividends Paid
(2,593 and 6,966 shares, respectively)................................... 3,894 8,830
Payments for 11,954 and 17,180 Shares Redeemed............................. (17,773) (22,051)
-------- --------
Net Increase in Net Assets Resulting from Fund Share Transactions
(37,834 and 229,899 shares, respectively)............................. 58,503 289,819
-------- --------
Total Increase in Net Assets.................................................. 179,010 290,644
NET ASSETS
Beginning of Year............................................................. 316,123 25,479
-------- --------
End of Year (includes undistributed net investment income of
$6,192 and $65, respectively).............................................. $495,133 $316,123
======== ========
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
21
<PAGE> 25
NORTHWESTERN MUTUAL SERIES FUND, INC.
INDEX 500 STOCK PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE YEARS
ENDED DECEMBER 31,
-----------------------------------------------------
1995 1994 1993 1992 1991
-------- -------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
Net Asset Value, Beginning of Year................. $ 1.27 $ 1.29 $1.33 $1.31 $1.04
Income from Investment Operations:
Net Investment Income......................... 0.04 0.03 0.04 0.03 0.03
Net Realized and Unrealized Gain (Loss) on
Investments................................. 0.42 (0.01) 0.09 0.03 0.27
-------- ----- ---
------ --- --- --- ---
-- -- --
Total from Investment Operations............ 0.46 0.02
0.13 0.06 0.30
-------- ----- ---
------ --- --- --- ---
-- -- --
Less Distributions:
Dividends from Net Investment Income.......... (0.01) (0.03) (0.03) (0.03) (0.03)
Distributions from Realized Gains on
Investments................................. -- (0.01) (0.14) (0.01) --
-------- ----- ---
------ --- --- --- ---
-- -- --
Total Distributions......................... (0.01) (0.04)
(0.17) (0.04) (0.03)
-------- ----- ---
------ --- --- --- ---
-- -- --
Net Asset Value, End of Year....................... $ 1.72 $ 1.27
$1.29 $1.33 $1.31
======== ========
======== ======== ========
Total Return+...................................... 37.25% 1.21%
9.90% 4.54% 29.78%
======== ========
======== ======== ========
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Year (in thousands)............. $495,133 $316,123 $25,479 $17,288 $14,115
======== ======== ======== ======== ========
Ratio of Expenses to Average Net Assets............ 0.21% 0.24% 0.30% 0.30% 0.30%
======== ======== ======== ======== ========
Ratio of Net Investment Income to Average Net
Assets........................................... 2.51% 3.10% 2.55% 2.61% 2.88%
======== ======== ======== ======== ========
Portfolio Turnover Rate............................ 3.19% 5.59% 62.69% 39.93% 40.16%
======== ======== ======== ======== ========
</TABLE>
+ Total Return includes deductions for total net expenses; excludes deductions
for sales loads and account fees.
The Accompanying Notes are an Integral Part of the Financial Statements
22
<PAGE> 26
FINANCIAL STATEMENTS OF
NORTHWESTERN MUTUAL SERIES FUND, INC.
GROWTH STOCK PORTFOLIO
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<S> <C>
ASSETS
Common Stocks
(cost $67,174).................... $80,157
Money Market Investments
(cost $5,793)..................... 5,793
-------
85,950
Cash................................. 40
Due from Sale of Fund Shares......... 146
Dividends and Interest Receivable.... 101
-------
Total Assets.................... 86,237
-------
LIABILITIES
Due on Purchase of Securities........ 562
Due on Redemption of Fund Shares..... 57
Due to Investment Advisor............ 40
Accrued Expenses..................... 21
-------
Total Liabilities............... 680
-------
NET ASSETS............................. $85,557
=======
REPRESENTED BY:
Aggregate Paid in Capital
(400,000 shares authorized,
$.01 par value; 67,734 shares
outstanding)...................... $71,939
Undistributed Net Investment
Income............................ 11
Undistributed Accumulated Net
Realized
Gain on Investments............... 621
Net Unrealized Appreciation of:
Investment Securities............. 12,983
Foreign Currency Transactions..... 3
-------
Net Assets for 67,734 Shares
Outstanding....................... $85,557
=======
Net Asset Value, Offering and
Redemption Price per Share........ $1.26
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME
Income
Dividends (less foreign dividend
tax of $2)...................... $ 1,156
Interest.......................... 339
-------
Total Income.................... 1,495
-------
Expenses
Management Fees................... 362
Custodian Fees.................... 22
Other Expenses.................... 24
-------
Total Expenses.................. 408
-------
Less Custodian Fees Paid by
Affiliate.................... (22)
-------
Total Net Expenses.............. 386
-------
Net Investment Income................ 1,109
-------
REALIZED AND UNREALIZED
GAIN ON INVESTMENTS
AND FOREIGN CURRENCIES
Net Realized Gain on Investments..... 2,321
Net Change in Unrealized Appreciation
of:
Investment Securities............. 13,075
Foreign Currency Transactions..... 3
-------
Net Change in Unrealized
Appreciation of Investments for
the Year........................ 13,078
-------
Net Gain on Investments.............. 15,399
-------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS............ $16,508
=======
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
23
<PAGE> 27
NORTHWESTERN MUTUAL SERIES FUND, INC.
GROWTH STOCK PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE
PERIOD
FOR THE MAY 3, 1994*
YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31,
1995 1994
------------ ------------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations
Net Investment Income................................................. $ 1,109 $ 518
Net Realized Gain (Loss) on Investments............................... 2,321 (20)
Net Change in Unrealized Appreciation (Depreciation) of Investments... 13,078 (92)
------------ ------------
Net Increase in Net Assets Resulting from Operations................ 16,508 406
------------ ------------
Dividends to Shareholders from:
Net Investment Income................................................. (1,105) (511)
Net Realized Gain on Investments...................................... (1,582) (98)
------------ ------------
Net Decrease in Net Assets Resulting from Dividends to
Shareholders....................................................... (2,687) (609)
------------ ------------
Fund Share Transactions
Proceeds from Sale of 24,515 and 41,690 Shares........................ 28,181 41,858
Proceeds from Shares Issued on Reinvestment of Dividends Paid
(2,177 and 547 shares, respectively)................................ 2,687 547
Payments for 866 and 329 Shares Redeemed.............................. (1,000) (334)
------------ ------------
Net Increase in Net Assets Resulting from Fund Share Transactions
(25,826 and 41,908 shares, respectively)......................... 29,868 42,071
------------ ------------
Total Increase in Net Assets............................................. 43,689 41,868
NET ASSETS
Beginning of Year........................................................ 41,868 0
------------ ------------
End of Year (includes undistributed net investment income of
$11 and $7, respectively)............................................. $ 85,557 $ 41,868
=========== ===========
</TABLE>
* Commencement of Operations.
The Accompanying Notes are an Integral Part of the Financial Statements
24
<PAGE> 28
NORTHWESTERN MUTUAL SERIES FUND, INC.
GROWTH STOCK PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE
PERIOD
MAY 3,
FOR THE 1994*
YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31,
1995 1994
------------ ------------
<S> <C> <C>
SELECTED PER SHARE DATA
Net Asset Value, Beginning of Year......................................... $ 1.00 $ 1.00
Income from Investment Operations:
Net Investment Income................................................. 0.02 0.01
Net Realized and Unrealized Gains on Investments...................... 0.28 --
-------- --------
Total from Investment Operations.................................... 0.30 0.01
-------- --------
Less Distributions:
Dividends from Net Investment Income.................................. (0.02) (0.01)
Distributions from Realized Gains on Investments...................... (0.02) --
-------- --------
Total Distributions................................................. (0.04) (0.01)
-------- --------
Net Asset Value, End of Year............................................... $ 1.26 $ 1.00
======== ========
Total Return+.............................................................. 30.82% 1.55%++
======== ========
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Year (in thousands)..................................... $85,557 $41,868
======== ========
Ratio of Expenses to Average Net Assets.................................... 0.61% 0.71%**
======== ========
Ratio of Net Investment Income to Average Net Assets....................... 1.77% 2.30%**
======== ========
Portfolio Turnover Rate.................................................... 46.83% 16.51%
======== ========
</TABLE>
* Commencement of Operations.
** Computed on an annualized basis.
+ Total Return includes deductions for total net expenses; excludes deductions
for sales loads and account fees.
++ Reflects total return for the period; not annualized.
The Accompanying Notes are an Integral Part of the Financial Statements
25
<PAGE> 29
FINANCIAL STATEMENTS OF
NORTHWESTERN MUTUAL SERIES FUND, INC.
GROWTH AND INCOME STOCK PORTFOLIO
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<S> <C>
ASSETS
Common Stocks
(cost $117,315)................... $130,509
Money Market Investments
(cost $5,795)..................... 5,795
--------
136,304
Cash................................. 167
Due from Sale of Securities.......... 310
Dividends and Interest Receivable.... 176
Due from Sale of Fund Shares......... 109
--------
Total Assets.................... 137,066
--------
LIABILITIES
Due to Investment Advisor............ 71
Due on Redemption of Fund Shares..... 41
Accrued Expenses..................... 31
--------
Total Liabilities............... 143
--------
NET ASSETS............................. $136,923
========
REPRESENTED BY:
Aggregate Paid in Capital (400,000
shares authorized, $.01 par value;
113,090 shares outstanding)....... $120,323
Undistributed Net Investment
Income............................ 17
Undistributed Accumulated Net
Realized Gain on Investments...... 3,389
Net Unrealized Appreciation of
Investments....................... 13,194
--------
Net Assets for 113,090 Shares
Outstanding....................... $136,923
========
Net Asset Value, Offering and
Redemption Price per Share........ $1.21
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME
Income
Dividends (less foreign dividend
tax of $14)...................... $ 2,160
Interest........................... 206
-------
Total Income..................... 2,366
-------
Expenses
Management Fees.................... 647
Custodian Fees..................... 35
Other Expenses..................... 39
-------
Total Expenses................... 721
-------
Less Custodian Fees Paid by
Affiliate................... (35)
-------
Total Net Expenses............... 686
-------
Net Investment Income................. 1,680
-------
REALIZED AND UNREALIZED GAIN ON
INVESTMENTS
Net Realized Gain on Investments...... 9,722
Net Change in Unrealized Appreciation
of Investments for the Year........ 14,711
-------
Net Gain on Investments............... 24,433
-------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS....................... $26,113
=======
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
26
<PAGE> 30
NORTHWESTERN MUTUAL SERIES FUND, INC.
GROWTH AND INCOME STOCK PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE
PERIOD
MAY 3,
FOR THE 1994*
YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31,
1995 1994
------------ ------------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations
Net Investment Income................................................. $ 1,680 $ 578
Net Realized Gain on Investments...................................... 9,722 632
Net Change in Unrealized Appreciation (Depreciation) of Investments... 14,711 (1,517)
-------- -------
Net Increase (Decrease) in Net Assets Resulting from Operations..... 26,113 (307)
-------- -------
Dividends to Shareholders from:
Net Investment Income................................................. (1,667) (574)
Net Realized Gain on Investments...................................... (6,435) (530)
-------- -------
Net Decrease in Net Assets Resulting from Dividends to
Shareholders....................................................... (8,102) (1,104)
-------- -------
Fund Share Transactions
Proceeds from Sale of 41,708 and 65,417 Shares........................ 47,441 65,790
Proceeds from Shares Issued on Reinvestment of Dividends Paid
(6,769 and 1,060 shares, respectively).............................. 8,102 1,042
Payments for 1,144 and 720 Shares Redeemed............................ (1,331) (721)
-------- -------
Net Increase in Net Assets Resulting from Fund Share Transactions
(47,333 and 65,757 shares, respectively)......................... 54,212 66,111
-------- -------
Total Increase in Net Assets............................................. 72,223 64,700
-------- -------
NET ASSETS
Beginning of Year........................................................ 64,700 0
-------- -------
End of Year (includes undistributed net investment income of
$17 and $4, respectively)............................................. $136,923 $ 64,700
======== =======
</TABLE>
* Commencement of Operations.
The Accompanying Notes are an Integral Part of the Financial Statements
27
<PAGE> 31
NORTHWESTERN MUTUAL SERIES FUND, INC.
GROWTH AND INCOME STOCK PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE
PERIOD
MAY 3,
FOR THE 1994*
YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31,
1995 1994
------------ ------------
<S> <C> <C>
SELECTED PER SHARE DATA
Net Asset Value, Beginning of Year......................................... $ 0.98 $ 1.00
Income from Investment Operations:
Net Investment Income................................................. 0.02 0.01
Net Realized and Unrealized Gain (Loss) on Investments................ 0.29 (0.01)
-------- --------
Total from Investment Operations.................................... 0.31 0.00
Less Distributions:
Dividends from Net Investment Income.................................. (0.02) (0.01)
Distributions from Realized Gains on Investments...................... (0.06) (0.01)
-------- --------
Total Distributions................................................. (0.08) (0.02)
-------- --------
Net Asset Value, End of Year............................................... $ 1.21 $ 0.98
======== ========
Total Return+.............................................................. 31.12% 0.34%++
======== ========
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Year (in thousands)..................................... $136,923 $ 64,700
======== ========
Ratio of Expenses to Average Net Assets.................................... 0.69% 0.78%**
======== ========
Ratio of Net Investment Income to Average Net Assets....................... 1.68% 1.93%**
======== ========
Portfolio Turnover Rate.................................................... 80.00% 54.18%
======== ========
</TABLE>
* Commencement of Operations.
** Computed on an annualized basis.
+ Total Return includes deductions for total net expenses; excludes deductions
for sales loads and account fees.
++ Reflects total return for the period; not annualized.
The Accompanying Notes are an Integral Part of the Financial Statements
28
<PAGE> 32
FINANCIAL STATEMENTS OF
NORTHWESTERN MUTUAL SERIES FUND, INC.
AGGRESSIVE GROWTH STOCK PORTFOLIO
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<S> <C>
ASSETS
Common Stocks
(cost $359,325).................. $ 541,598
Money Market Investments
(cost $36,459)................... 36,459
--------
578,057
Cash................................ 63
Due from Sale of Securities......... 2,045
Due from Sale of Fund Shares........ 123
Dividends and Interest Receivable... 88
--------
Total Assets................... 580,376
--------
LIABILITIES
Due on Purchase of Securities....... 2,926
Due on Redemption of Fund Shares.... 146
Due to Investment Advisor........... 256
Accrued Expenses.................... 34
--------
Total Liabilities.............. 3,362
--------
NET ASSETS............................ $ 577,014
========
REPRESENTED BY:
Aggregate Paid in Capital
(700,000 shares authorized,
$.01 par value; 208,208 shares
outstanding)..................... $ 369,183
Undistributed Net Investment
Income........................... 572
Undistributed Accumulated Net
Realized Gain on Investments..... 24,986
Net Unrealized Appreciation of
Investments...................... 182,273
--------
Net Assets for 208,208 Shares
Outstanding...................... $ 577,014
========
Net Asset Value, Offering and
Redemption Price per Share....... $2.77
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME
Income
Interest......................... $ 2,246
Dividends (less foreign dividend
tax of $4)..................... 817
--------
Total Income................... 3,063
--------
Expenses
Management Fees.................. 2,448
Custodian Fees................... 39
Other............................ 43
--------
Total Expenses................. 2,530
--------
Less Custodian Fees Paid by
Affiliate................. (39)
--------
Total Net Expenses............. 2,491
--------
Net Investment Income............... 572
--------
REALIZED AND UNREALIZED
GAIN ON INVESTMENTS
Net Realized Gain on Investments.... 24,986
Net Change in Unrealized
Appreciation of Investments for
the Year......................... 124,412
--------
Net Gain on Investments............. 149,398
--------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS........... $ 149,970
========
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
29
<PAGE> 33
NORTHWESTERN MUTUAL SERIES FUND, INC.
AGGRESSIVE GROWTH STOCK PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE
PERIOD
MAY 3,
FOR THE 1994*
YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31,
1995 1994
------------ ------------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations
Net Investment Income................................................. $ 572 $ 566
Net Realized Gain on Investments...................................... 24,986 1,836
Net Change in Unrealized Appreciation of Investments.................. 124,412 12,516
-------- --------
Net Increase in Net Assets Resulting from Operations................ 149,970 14,918
-------- --------
Dividends to Shareholders from:
Net Investment Income................................................. (503) (63)
Net Realized Gain on Investments...................................... (1,836) 0
-------- --------
Net Decrease in Net Assets Resulting from Dividends to
Shareholders....................................................... (2,339) (63)
-------- --------
Fund Share Transactions
Proceeds from Sale of 50,142 and 36,999 Shares........................ 115,824 70,697
Proceeds from Sale of 128,778 Shares Issued in Acquisition of
Northwestern Mutual Aggressive Growth Stock Fund, Inc............... -- 245,687
Proceeds from Shares Issued on Reinvestment of Dividends Paid
(1,097 and 35 shares, respectively)................................. 2,339 63
Payments for 6,659 and 2,184 Shares Redeemed.......................... (15,876) (4,206)
-------- --------
Net Increase in Net Assets Resulting from Fund Share Transactions
(44,580 and 163,628 shares, respectively)........................ 102,287 312,241
-------- --------
Total Increase in Net Assets............................................. 249,918 327,096
NET ASSETS
Beginning of Year........................................................ 327,096 0
-------- --------
End of Year (includes undistributed net investment income of
$572 and $503, respectively).......................................... $577,014 $327,096
======== ========
</TABLE>
* Commencement of Operations.
The Accompanying Notes are an Integral Part of the Financial Statements
30
<PAGE> 34
NORTHWESTERN MUTUAL SERIES FUND, INC.
AGGRESSIVE GROWTH STOCK PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE
PERIOD
MAY 3,
FOR THE YEAR 1994*
ENDED THROUGH
DECEMBER 31, DECEMBER 31,
1995 1994
------------ ------------
<S> <C> <C>
SELECTED PER SHARE DATA
Net Asset Value, Beginning of Year......................................... $ 2.00 $ 1.91
Income from Investment Operations:
Net Investment Income................................................. -- --
Net Realized and Unrealized Gains on Investments...................... 0.78 0.09
-------- --------
Total from Investment Operations.................................... 0.78 0.09
-------- --------
Less Distributions:
Dividends from Net Investment Income.................................. -- --
Distributions from Realized Gains on Investments...................... (0.01) --
-------- --------
Total Distributions................................................. (0.01) --
-------- --------
Net Asset Value, End of Year............................................... $ 2.77 $ 2.00
======== ========
Total Return+.............................................................. 39.29% 4.47%++
======== ========
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Year (in thousands)..................................... $577,014 $327,096
======== ========
Ratio of Expenses to Average Net Assets.................................... 0.56% 0.58%**
======== ========
Ratio of Net Investment Income to Average Net Assets....................... 0.13% 0.29%**
======== ========
Portfolio Turnover Rate.................................................... 37.84% 21.54%
======== ========
</TABLE>
* Commencement of Operations.
** Computed on an annualized basis.
+ Total Return includes deductions for total net expenses; excludes deductions
for sales loads and account fees.
++ Reflects total return for the period; not annualized.
The Accompanying Notes are an Integral Part of the Financial Statements
31
<PAGE> 35
FINANCIAL STATEMENTS OF
NORTHWESTERN MUTUAL SERIES FUND, INC.
INTERNATIONAL EQUITY PORTFOLIO
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<S> <C>
ASSETS
Common Stocks
(cost $268,731)................... $295,516
Money Market Investments
(cost $33,248).................... 33,212
Bonds
(cost $8,215)..................... 8,631
Preferred Stock
(cost $754)....................... 822
--------
338,181
Cash................................. 267
Due from Sale of Securities.......... 3,819
Due from Foreign Currency
Contracts......................... 3,731
Dividends and Interest Receivable.... 1,230
--------
Total Assets.................... 347,228
--------
LIABILITIES
Due on Foreign Currency Contracts.... 3,740
Due on Purchase of Securities........ 901
Accrued Expenses..................... 225
Due to Investment Advisor............ 194
Due on Redemption of Fund Shares..... 41
--------
Total Liabilities............... 5,101
--------
NET ASSETS............................. $342,127
========
REPRESENTED BY:
Aggregate Paid in Capital (700,000
shares authorized, $.01 par value;
252,496 shares outstanding)....... $295,451
Undistributed Net Investment
Income............................ 8,396
Undistributed Accumulated Net
Realized Gain on Investments...... 11,201
Net Unrealized Appreciation
(Depreciation) of:
Investment Securities............. 27,233
Foreign Currency Transactions..... (154)
--------
Net Assets for 252,496 Shares
Outstanding....................... $342,127
========
Net Asset Value, Offering and
Redemption Price per Share........ $1.35
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME
Income
Dividends (less foreign dividend
tax of $1,197)................... $ 8,989
Interest........................... 2,140
-------
Total Income..................... 11,129
-------
Expenses
Management Fees.................... 2,151
Custodian Fees..................... 336
Other Expenses..................... 205
-------
Total Expenses................... 2,692
-------
Net Investment Income................. 8,437
-------
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS AND
FOREIGN CURRENCIES
Net Realized Gain (Loss) on:
Investment Securities.............. 11,653
Foreign Currency Transactions...... (198)
-------
Net Realized Gain for the Year... 11,455
Net Change in Unrealized Appreciation
(Depreciation) of:
Investment Securities.............. 23,057
Foreign Currency Transactions...... (150)
-------
Net Change in Unrealized
Appreciation of Investments
for the Year.................. 22,907
-------
Net Gain on Investments............... 34,362
-------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS....................... $42,799
=======
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
32
<PAGE> 36
NORTHWESTERN MUTUAL SERIES FUND, INC.
INTERNATIONAL EQUITY PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE
PERIOD
MAY 3,
FOR THE 1994*
YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31,
1995 1994
------------- -------------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations
Net Investment Income................................................ $ 8,437 $ 4,233
Net Realized Gain on Investments..................................... 11,455 4,575
Net Change in Unrealized Appreciation(Depreciation) of Investments... 22,907 (8,846)
-------- --------
Net Increase(Decrease) in Net Assets Resulting from Operations..... 42,799 (38)
-------- --------
Dividends to Shareholders from:
Net Investment Income................................................ -- (4,907)
Net Realized Gain on Investments..................................... (2,171) (2,658)
-------- --------
Net Decrease in Net Assets Resulting from Dividends to
Shareholders...................................................... (2,171) (7,565)
-------- --------
Fund Share Transactions
Proceeds from Sale of 28,399 and 73,071 Shares....................... 35,839 90,632
Proceeds from Sale of 193,618 Shares Issued in Acquisition of
Northwestern Mutual International Equity Fund, Inc. ............... -- 236,438
Proceeds from Shares Issued on Reinvestment of Dividends Paid
(1,740 and 6,300 shares, respectively)............................. 2,171 7,461
Payments for 23,252 and 27,830 Shares Redeemed....................... (29,044) (34,395)
-------- --------
Net Increase in Net Assets Resulting from Fund Share Transactions
(6,887 and 245,609 shares, respectively)........................ 8,966 300,136
-------- --------
Total Increase in Net Assets.............................................. 49,594 292,533
NET ASSETS
Beginning of Year....................................................... 292,533 0
-------- --------
End of Year (includes (over)/undistributed net investment income of
$8,396 and ($41), respectively)...................................... $ 342,127 $ 292,533
======== ========
</TABLE>
* Commencement of Operations.
The Accompanying Notes are an Integral Part of the Financial Statements
33
<PAGE> 37
NORTHWESTERN MUTUAL SERIES FUND, INC.
INTERNATIONAL EQUITY PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE
PERIOD
MAY 3,
FOR THE 1994*
YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31,
1995 1994
------------ ------------
<S> <C> <C>
SELECTED PER SHARE DATA
Net Asset Value, Beginning of Year......................................... $ 1.19 $ 1.22
Income from Investment Operations:
Net Investment Income................................................. 0.04 0.02
Net Realized and Unrealized Gain (Loss) on Investments................ 0.13 (0.02)
-------- --------
Total from Investment Operations.................................... 0.17 0.00
-------- --------
Less Distributions:
Dividends from Net Investment Income.................................. -- (0.02)
Distributions from Realized Gains on Investments...................... (0.01) (0.01)
-------- --------
Total Distributions................................................. (0.01) (0.03)
-------- --------
Net Asset Value, End of Year............................................... $ 1.35 $ 1.19
======== ========
Total Return+.............................................................. 14.57% 0.11%++
======== ========
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Year (in thousands)..................................... $342,127 $292,533
======== ========
Ratio of Expenses to Average Net Assets.................................... 0.85% 0.87%**
======== ========
Ratio of Net Investment Income to Average Net Assets....................... 2.68% 2.28%**
======== ========
Portfolio Turnover Rate.................................................... 26.71% 10.97%
======== ========
</TABLE>
* Commencement of Operations.
** Computed on an annualized basis.
+ Total Return includes deductions for total net expenses: excludes deductions
for sales loads and account fees.
++ Reflects total return for the period; not annualized.
The Accompanying Notes are an Integral Part of the Financial Statements
34
<PAGE> 38
FINANCIAL STATEMENTS OF
NORTHWESTERN MUTUAL SERIES FUND, INC.
SELECT BOND PORTFOLIO
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<S> <C>
ASSETS
Bonds
(cost $154,441).................. $163,192
Money Market Investments
(cost $32,102)................... 32,122
--------
195,314
Cash................................ 221
Interest Receivable................. 2,655
Due from Sale of Fund Shares........ 14
--------
Total Assets................... 198,204
--------
LIABILITIES
Due to Investment Advisor........... 50
Due on Redemption of Fund Shares.... 12
--------
Total Liabilities.............. 62
--------
NET ASSETS............................ $198,142
========
REPRESENTED BY:
Aggregate Paid in Capital
(400,000 shares authorized,
$.01 par value; 161,337 shares
outstanding)..................... $183,672
Undistributed Net Investment
Income........................... 7,037
Undistributed Accumulated Net
Realized Loss on Investments..... (1,338)
Net Unrealized Appreciation of
Investments...................... 8,771
--------
Net Assets for 161,337 Shares
Outstanding...................... $198,142
========
Net Asset Value, Offering and
Redemption Price per Share....... $1.23
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME
Income
Interest.......................... $12,209
------
Expenses
Management Fees................... 529
------
Net Investment Income................ 11,680
------
REALIZED AND UNREALIZED
GAIN ON INVESTMENTS
Net Realized Gain on Investments..... 1,666
Net Change in Unrealized Appreciation
of Investments for the Year....... 17,183
------
Net Gain on Investments.............. 18,849
------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS............ $30,529
======
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
35
<PAGE> 39
NORTHWESTERN MUTUAL SERIES FUND, INC.
SELECT BOND PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS
ENDED DECEMBER 31,
--------------------
1995 1994
-------- --------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations
Net Investment Income...................................................... $ 11,680 $ 7,962
Net Realized Gain (Loss) on Investments.................................... 1,666 (3,004)
Net Change in Unrealized Appreciation (Depreciation) of Investments........ 17,183 (4,221)
-------- --------
Net Increase in Net Assets Resulting from Operations..................... 30,529 737
-------- --------
Dividends to Shareholders from:
Net Investment Income...................................................... (4,709) (7,907)
Net Realized Gain on Investments........................................... -- (75)
-------- --------
Net Decrease in Net Assets Resulting from Dividends to Shareholders...... (4,709) (7,982)
-------- --------
Fund Share Transactions
Proceeds from Sale of 20,151 and 7,274 Shares.............................. 23,377 8,071
Proceeds from Sale of 148,197 Shares Issued in Acquisition of
Northwestern Mutual Select Bond Fund, Inc................................ -- 163,901
Proceeds from Shares Issued on Reinvestment of Dividends Paid
(4,071 and 7,517 shares, respectively)................................... 4,709 7,982
Payments for 12,511 and 28,622 Shares Redeemed............................. (14,272) (31,686)
-------- --------
Net Increase in Net Assets Resulting from Fund Share Transactions
(11,711 and 134,366 shares, respectively)............................. 13,814 148,268
-------- --------
Total Increase in Net Assets.................................................. 39,634 141,023
NET ASSETS
Beginning of Year............................................................. 158,508 17,485
-------- --------
End of Year (includes undistributed net investment income of
$7,037 and $66, respectively).............................................. $198,142 $158,508
======== ========
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
36
<PAGE> 40
NORTHWESTERN MUTUAL SERIES FUND, INC.
SELECT BOND PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE YEARS
ENDED DECEMBER 31,
--------------------------------------------------------
1995 1994 1993 1992 1991
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
Net Asset Value, Beginning of Year....................... $ 1.06 $ 1.15 $ 1.14 $ 1.18 $ 1.09
Income from Investment Operations:
Net Investment Income............................... 0.07 0.06 0.08 0.09 0.09
Net Realized and Unrealized Gain (Loss) on
Investments....................................... 0.13 (0.09) 0.05 -- 0.09
-------- ----- --- ----- --- ----- --- ----- ---
Total from Investment Operations.................. 0.20 (0.03) 0.13 0.09 0.18
-------- ----- --- ----- --- ----- --- ----- ---
Less Distributions:
Dividends from Net Investment Income................ (0.03) (0.06) (0.08) (0.09) (0.09)
Distributions from Realized Gain on Investments..... -- -- (0.04) (0.04) --
-------- ----- --- ----- --- ----- --- ----- ---
Total Distributions............................... (0.03) (0.06) (0.12) (0.13) (0.09)
-------- ----- --- ----- --- ----- --- ----- ---
Net Asset Value, End of Year............................. $ 1.23 $ 1.06 $ 1.15 $ 1.14 $ 1.18
======== ======== ======== ======== ========
Total Return+............................................ 19.10% (2.28%) 10.81% 7.74% 17.32%
======== ======== ======== ======== ========
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Year (in thousands)................... $198,142 $158,508 $17,485 $15,851 $14,703
======== ======== ======== ======== ========
Ratio of Expenses to Average Net Assets.................. 0.30% 0.30% 0.30% 0.30% 0.30%
======== ======== ======== ======== ========
Ratio of Net Investment Income to Average Net Assets..... 6.61% 7.02% 6.40% 7.52% 8.11%
======== ======== ======== ======== ========
Portfolio Turnover Rate.................................. 69.06% 108.00% 67.69% 63.29% 60.88%
======== ======== ======== ======== ========
</TABLE>
+ Total Return includes deductions for management expenses; excludes deductions
for sales load and account fees.
The Accompanying Notes are an Integral Part of the Financial Statements
37
<PAGE> 41
FINANCIAL STATEMENTS OF
NORTHWESTERN MUTUAL SERIES FUND, INC.
HIGH YIELD BOND PORTFOLIO
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<S> <C>
ASSETS
Bonds
(cost $52,957).................... $52,950
Money Market Investments
(cost $1,199)..................... 1,199
Preferred Stock
(cost $500)....................... 630
Common Stock
(cost $29)........................ 140
-------
54,919
Dividends and Interest Receivable.... 1,164
Due From Sale of Fund Shares......... 10
-------
Total Assets.................... 56,093
-------
LIABILITIES
Due to Custodian..................... 43
Due to Investment Advisor............ 28
Due on Redemption of Fund Shares..... 26
Accrued Expenses..................... 22
-------
Total Liabilities............... 119
-------
NET ASSETS............................. $55,974
=======
REPRESENTED BY:
Aggregate Paid in Capital
(400,000 shares authorized,
$.01 par value; 54,536 shares
outstanding)...................... $55,455
Overdistributed Net Investment
Income............................ (38)
Undistributed Accumulated Net
Realized Gain on Investments...... 323
Net Unrealized Appreciation of
Investments....................... 234
-------
Net Assets for 54,536 Shares
Outstanding....................... $55,974
=======
Net Asset Value, Offering and
Redemption Price per Share........ $1.03
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME
Income
Interest........................... $4,794
Other Income....................... 51
------
Total Income..................... 4,845
------
Expenses
Management Fees.................... 275
Custodian Fees..................... 17
Other Expenses..................... 22
------
Total Expenses................... 314
------
Less Custodian Fees Paid by
Affiliate................... (17)
------
Total Net Expenses............... 297
------
Net Investment Income................. 4,548
------
REALIZED AND UNREALIZED
GAIN ON INVESTMENTS
Net Realized Gain on Investments...... 970
Net Change in Unrealized Appreciation
of Investments for the Year........ 1,206
------
Net Gain on Investments............... 2,176
------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS............. $6,724
======
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
38
<PAGE> 42
NORTHWESTERN MUTUAL SERIES FUND, INC.
HIGH YIELD BOND PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE
PERIOD
MAY 3,
FOR THE 1994*
YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31,
1995 1994
------------ ------------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations
Net Investment Income...................................................... $ 4,548 $ 1,937
Net Realized Gain (Loss) on Investments.................................... 970 (86)
Net Change in Unrealized Appreciation (Depreciation) of Investments........ 1,206 (972)
------- -------
Net Increase in Net Assets Resulting from Operations..................... 6,724 879
------- -------
Dividends to Shareholders from:
Net Investment Income...................................................... (4,604) (1,919)
Net Realized Gain on Investments........................................... (465) (96)
------- -------
Net Decrease in Net Assets Resulting from Dividends to Shareholders...... (5,069) (2,015)
------- -------
Fund Share Transactions
Proceeds from Sale of 14,751 and 35,400 Shares............................. 15,535 35,565
Proceeds from Shares Issued on Reinvestment of Dividends Paid
(4,919 and 2,004 shares, respectively)................................... 5,069 1,941
Payments for 1,724 and 814 Shares Redeemed................................. (1,822) (833)
------- -------
Net Increase in Net Assets Resulting from Fund Share Transactions
(17,946 and 36,590 shares, respectively).............................. 18,782 36,673
------- -------
Total Increase in Net Assets.................................................. 20,437 35,537
NET ASSETS
Beginning of Year............................................................. 35,537 0
------- -------
End of Year (includes (over)/undistributed net investment income of
($38) and $18, respectively)............................................... $ 55,974 $ 35,537
======= =======
</TABLE>
* Commencement of Operations.
The Accompanying Notes are an Integral Part of the Financial Statements
39
<PAGE> 43
NORTHWESTERN MUTUAL SERIES FUND, INC.
HIGH YIELD BOND PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE
PERIOD
MAY 3,
FOR THE 1994*
YEAR ENDED THROUGH
DECEMBER 31, DECEMBER 31,
1995 1994
------------ ------------
<S> <C> <C>
SELECTED PER SHARE DATA
Net Asset Value, Beginning of Year............................................ $ 0.97 $ 1.00
Income from Investment Operations:
Net Investment Income.................................................... 0.10 0.06
Net Realized and Unrealized Gain (Loss) on Investments................... 0.07 (0.03)
-------- --------
Total from Investment Operations....................................... 0.17 0.03
-------- --------
Less Distributions:
Dividends from Net Investment Income..................................... (0.10) (0.06)
Distributions from Realized Gains on Investments......................... (0.01) --
-------- --------
Total Distributions.................................................... (0.11) (0.06)
-------- --------
Net Asset Value, End of Year.................................................. $ 1.03 $ 0.97
======== ========
Total Return+................................................................. 16.78% 3.02%++
======== ========
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Year (in thousands)........................................ $ 55,974 $ 35,537
======== ========
Ratio of Expenses to Average Net Assets....................................... 0.65% 0.73% **
======== ========
Ratio of Net Investment Income to Average Net Assets.......................... 9.90% 9.40% **
======== ========
Portfolio Turnover Rate....................................................... 116.57% 119.48%
======== ========
</TABLE>
* Commencement of Operations.
** Computed on an annualized basis.
+ Total Return includes deductions for total net expenses; excludes deductions
for sales loads and account fees.
++ Reflects total return for the period; not annualized.
The Accompanying Notes are an Integral Part of the Financial Statements
40
<PAGE> 44
FINANCIAL STATEMENTS OF
NORTHWESTERN MUTUAL SERIES FUND, INC.
MONEY MARKET PORTFOLIO
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<S> <C>
ASSETS
Money Market Investments
(cost $131,681)................... $131,681
Cash................................. 84
Due from Sale of Fund Shares......... 717
Interest Receivable.................. 123
--------
Total Assets.................... 132,605
--------
LIABILITIES
Due to Investment Advisor............ 33
--------
NET ASSETS............................. $132,572
========
REPRESENTED BY:
Aggregate Paid in Capital (300,000
shares authorized, $.01 par value;
132,588 shares outstanding)....... $132,572
--------
Net Assets for 132,588 Shares
Outstanding....................... $132,572
========
Net Asset Value, Offering and
Redemption Price per Share........ $1.00
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME
Income
Interest............................ $6,668
------
Expenses
Management Fees..................... 335
------
Net Investment Income.................. 6,333
------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS............................. $6,333
======
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
41
<PAGE> 45
NORTHWESTERN MUTUAL SERIES FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS
ENDED DECEMBER 31,
----------------------------
1995 1994
------------ ------------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations
Net Investment Income................................................. $ 6,333 $ 3,291
-------- --------
Net Increase in Net Assets Resulting from Operations................ 6,333 3,291
-------- --------
Dividends to Shareholders from:
Net Investment Income................................................. (6,333) (3,307)
-------- --------
Net Decrease in Net Assets Resulting from Dividends to
Shareholders....................................................... (6,333) (3,307)
-------- --------
Fund Share Transactions
Proceeds from Sale of 74,140 and 40,032 Shares........................ 74,140 40,032
Proceeds from Sale of 91,310 Shares Issued in Acquisition of
Northwestern Mutual Money Market Fund, Inc. ......................... -- 91,310
Proceeds from Shares Issued on Reinvestment of Dividend Paid
(6,333 and 2,938 shares, respectively).............................. 6,333 2,938
Payments for 52,118 and 42,704 Shares Redeemed........................ (52,118) (42,704)
-------- --------
Net Increase in Net Assets Resulting from Fund Share Transactions
(28,355 and 91,576 shares, respectively)......................... 28,355 91,576
-------- --------
Total Increase in Net Assets............................................. 28,355 91,560
NET ASSETS
Beginning of Year........................................................ 104,217 12,657
-------- --------
End of Year (includes no undistributed net investment income)............ $132,572 $104,217
======== ========
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
42
<PAGE> 46
NORTHWESTERN MUTUAL SERIES FUND, INC.
MONEY MARKET PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE YEARS
ENDED DECEMBER 31,
--------------------------------------------------------
1995 1994 1993 1992 1991
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
Net Asset Value, Beginning of Year............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Net Investment Income..................... 0.06 0.05 0.03 0.03 0.06
Less Dividends from Net Investment
Income.................................... (0.06) (0.05) (0.03) (0.03) (0.06)
-------- ----- --- ----- --- ----- --- ----- ---
Net Asset Value, End of Year................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ========
Total Return+.................................. 5.82% 4.03% 2.88% 3.49% 5.85%
======== ======== ======== ======== ========
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Year
(in thousands)............................... $132,572 $104,217 $12,657 $14,091 $12,787
======== ======== ======== ======== ========
Ratio of Expenses to Average Net
Assets....................................... 0.30% 0.30% 0.30% 0.30% 0.30%
======== ======== ======== ======== ========
Ratio of Net Investment Income to
Average Net Assets........................... 5.61% 4.64% 2.87% 3.40% 5.71%
======== ======== ======== ======== ========
</TABLE>
+ Total Return includes deductions for management expenses; excludes deductions
for sales loads and account fees.
The Accompanying Notes are an Integral Part of the Financial Statements
43
<PAGE> 47
FINANCIAL STATEMENTS OF
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
<TABLE>
<S> <C>
ASSETS
Common Stock
(cost $754,329)................ $1,051,375
Bonds
(cost $658,689)................ 693,161
Money Market Investments
(cost $325,478)................ 326,078
Preferred Stock
(cost $1)...................... 7
----------
2,070,621
Cash.............................. 291
Dividends and Interest
Receivable..................... 13,848
Due from Sale of Fund Shares...... 107
Futures Variation Margin.......... 86
----------
Total Assets................. 2,084,953
----------
LIABILITIES
Due on Redemption of Fund
Shares......................... 1,137
Due to Investment Advisor......... 527
----------
Total Liabilities............ 1,664
----------
NET ASSETS.......................... $2,083,289
==========
REPRESENTED BY:
Aggregate Paid in Capital
(2,000,000 shares authorized,
$.01 par value; 1,298,518
shares outstanding)............ $1,630,252
Undistributed Net Investment
Income......................... 83,551
Undistributed Accumulated Net
Realized Gain on Investments... 38,620
Net Unrealized Appreciation
(Depreciation) of:
Investment Securities.......... 332,124
Index Futures Contracts........ (1,258)
----------
Net Assets for 1,298,518 Shares
Outstanding.................... $2,083,289
==========
Net Asset Value, Offering and
Redemption Price per Share..... $1.60
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME
Income
Dividends (less foreign dividend
tax of $153)................... $ 23,254
Interest......................... 65,981
Other Income..................... 7
--------
Total Income................... 89,242
--------
Expenses
Management Fees.................. 5,696
--------
Net Investment Income............... 83,546
--------
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS
Net Realized Gain on Investments:
Investment Securities............ 22,299
Index Futures Contracts.......... 19,219
--------
Net Realized Gain on
Investments
for the Year................ 41,518
--------
Net Change In Unrealized
Appreciation (Depreciation) of:
Investment Securities............ 320,376
Index Futures Contracts.......... (2,330)
--------
Net Change in Unrealized
Appreciation of Investments
for the Year................ 318,046
--------
Net Gain on Investments............. 359,564
--------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS........... $443,110
========
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
44
<PAGE> 48
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
------------------------
1995 1994
---------- ----------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations
Net Investment Income.................................................. $ 83,546 $ 53,165
Net Realized Gain on Investments....................................... 41,518 5,281
Net Change in Unrealized Appreciation (Depreciation) of Investments.... 318,046 (17,767)
--------- ---------
Net Increase in Net Assets Resulting from Operations................. 443,110 40,679
--------- ---------
Dividends to Shareholders from:
Net Investment Income.................................................. (53,160) (28)
Net Realized Gain on Investments....................................... (8,179) (782)
--------- ---------
Net Decrease in Net Assets Resulting from Dividends to
Shareholders........................................................ (61,339) (810)
Fund Share Transactions
Proceeds from Sale of 35,282 and 21,149 Shares......................... 51,862 27,441
Proceeds from Sale of 1,330,565 Shares Issued in Acquisition of
Northwestern Mutual Balanced Fund, Inc. .............................. -- 1,705,466
Proceeds from Shares Issued on Reinvestment of Dividends Paid
(44,352 and 607 shares, respectively)................................ 61,339 810
Payments for 96,890 and 88,502 Shares Redeemed......................... (138,810) (115,369)
--------- ---------
Net Increase (Decrease) in Net Assets Resulting from Fund Share
Transactions ((17,256) and 1,263,819 shares, respectively).......... (25,609) 1,618,348
--------- ---------
Total Increase in Net Assets.............................................. 356,162 1,658,217
NET ASSETS
Beginning of Year......................................................... 1,727,127 68,910
--------- ---------
End of Year (includes undistributed net investment income of
$83,551 and $53,165 respectively)...................................... $2,083,289 $1,727,127
========= =========
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
45
<PAGE> 49
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE YEARS
ENDED DECEMBER 31,
------------------------------------------------------------
1995 1994 1993 1992 1991
---------- ---------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
Net Asset Value, Beginning of Year........... $ 1.31 $ 1.33 $ 1.39 $ 1.40 $ 1.19
Income from Investment Operations:
Net Investment Income................... 0.07 0.04 0.06 0.06 0.07
Net Realized and Unrealized
Gain (Loss) on Investments............ 0.27 (0.05) 0.09 0.01 0.21
---------- ------- --- ----- --- ----- --- ----- ---
Total from Investment
Operations......................... 0.34 (0.01) 0.15 0.07 0.28
---------- ------- --- ----- --- ----- --- ----- ---
Less Distributions:
Dividends from Net Investment
Income................................ (0.04) (0.00) (0.07) (0.06) (0.07)
Distributions from Realized Gain
on Investments........................ (0.01) (0.01) (0.14) (0.02) --
---------- ------- --- ----- --- ----- --- ----- ---
Total Distributions................... (0.05) (0.01) (0.21) (0.08) (0.07)
---------- ------- --- ----- --- ----- --- ----- ---
Net Asset Value, End of Year................. $ 1.60 $ 1.31 $ 1.33 $ 1.39 $ 1.40
========== ========== ======== ======== ========
Total Return+................................ 26.39% 0.16% 9.91% 5.61% 23.33%
========== ========== ======== ======== ========
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Year
(in thousands)............................. $2,083,289 $1,727,127 $68,910 $66,006 $57,269
========== ========== ======== ======== ========
Ratio of Expenses to Average Net
Assets..................................... 0.30% 0.30% 0.30% 0.30% 0.30%
========== ========== ======== ======== ========
Ratio of Net Investment Income to
Average Net Assets......................... 4.40% 4.78% 4.24% 4.45% 5.11%
========== ========== ======== ======== ========
Portfolio Turnover Rate...................... 37.28% 42.35% 70.91% 43.28% 55.46%
========== ========== ======== ======== ========
</TABLE>
+ Total Return includes deductions for management expenses; excludes deductions
for sales loads and account fees.
The Accompanying Notes are an Integral Part of the Financial Statements
46
<PAGE> 50
NORTHWESTERN MUTUAL SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
Note 1 -- Northwestern Mutual Series Fund, Inc. (the "Series Fund"), formerly
Northwestern Mutual Variable Life Series Fund, Inc., is registered as a
diversified open-end investment company under the Investment Company Act of
1940. The Series Fund consists of the Index 500 Stock Portfolio, Growth Stock
Portfolio, Growth and Income Stock Portfolio, Aggressive Growth Stock Portfolio,
International Equity Portfolio, Select Bond Portfolio, High Yield Bond
Portfolio, Money Market Portfolio, and the Balanced Portfolio (the
"Portfolios"). Shares are presently offered only to The Northwestern Mutual Life
Insurance Company ("Northwestern Mutual Life") and its segregated asset
accounts.
On May 3, 1994, five new portfolios commenced operations in the Series Fund:
Growth Stock Portfolio, Growth and Income Stock Portfolio, Aggressive Growth
Stock Portfolio, International Equity Portfolio and High Yield Bond Portfolio.
These five portfolios were organized with 700,000,000 authorized shares of
Common Stock for each of the Aggressive Growth Stock and International Equity
Portfolios and 400,000,000 authorized shares of Common Stock for each of the
Growth Stock, Growth and Income Stock and High Yield Bond Portfolios. Par Value
is $.01 per share. Northwestern Mutual Life purchased 25,000,000 shares each of
the Growth Stock, Growth and Income Stock and High Yield Bond Portfolios at
$1.00 per share.
Note 2 -- The assets of Northwestern Mutual Life's variable annuity funds were
merged into the Series Fund in a tax-free exchange of fund shares on May 3,
1994. The following summarizes the merge:
<TABLE>
<CAPTION>
# OF SHARES/ UNREALIZED APPRECIATION
MERGE FROM: VALUE REDEEMED (DEPRECIATION) TRANSFERRED
- -------------------------------------------------------------- -------------- --------------------------
<S> <C> <C>
Northwestern Mutual Index 500 Stock Fund, Inc. ............... 199,137,846
$ 277,484,077 $ 16,828,536
Northwestern Mutual Aggressive Growth Stock Fund, Inc. ....... 128,778,039
$ 245,687,070 $ 45,345,398
Northwestern Mutual International Equity Fund, Inc............ 193,618,391
$ 236,437,711 $ 13,017,843
Northwestern Mutual Select Bond Fund, Inc. ................... 127,156,919
$ 163,901,422 $ (4,867,983)
Northwestern Mutual Money Market Fund, Inc. .................. 91,309,664
$ 91,309,664 --
Northwestern Mutual Balanced Fund, Inc........................ 1,250,574,720
$1,705,465,964 $ 27,288,995
<CAPTION>
# OF SHARES/ AGGREGATE NET ASSETS
MERGED TO: VALUE RECEIVED OF PORTFOLIO AFTER MERGER
- -------------------------------------------------------------- -------------- -------------------------
<S> <C> <C>
Northwestern Mutual Series Fund, Inc.
-- Index 500 Stock Portfolio................................ 220,157,952
$ 277,484,077 $ 305,458,525
-- Aggressive Growth Stock Portfolio........................ 128,778,039
$ 245,687,070 $ 245,687,070
-- International Equity Portfolio........................... 193,618,391
$ 236,437,711 $ 236,437,711
-- Select Bond Portfolio.................................... 148,196,445
$ 163,901,422 $ 181,055,470
-- Money Market Portfolio................................... 91,309,664
$ 91,309,664 $ 104,436,452
-- Balanced Portfolio....................................... 1,330,564,679
$1,705,465,964 $1,776,058,467
</TABLE>
The Aggressive Growth Stock and International Equity Portfolios had no assets
prior to the merger so the assets of the Funds became the assets of the
Portfolios. Hence, these Portfolios commenced operations in the Series Fund on
May 3, 1994 at $1.91 and $1.22, respectively.
Note 3 -- The preparation of the 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
47
<PAGE> 51
NORTHWESTERN MUTUAL SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
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.
Principal accounting policies are summarized below.
Note 4 -- Bonds are valued on the basis of prices furnished by a service which
determines prices for normal institutional size trading units of bonds, without
regard to exchange or over-the-counter prices. When quotations are not readily
available, bonds are valued at fair market value determined by procedures
approved by the Board of Directors. Stocks listed on a national or foreign stock
exchange are valued at the final sale price, or final bid price in absence of a
sale. Stocks not listed on a national or foreign stock exchange are valued at
the closing bid price on the over-the-counter market. Money market investments,
other than in the Money Market Portfolio, with maturities exceeding sixty days
but generally not exceeding one year are valued by marking to market on the
basis of an average of the most recent bid prices or yields. Money market
investments with maturities of sixty days or less and all securities in the
Money Market Portfolio are valued on an amortized cost basis or, if the current
market value differs substantially from the amortized cost, by marking to
market.
Note 5 -- Securities and other assets and liabilities denominated in foreign
currencies are translated into U.S. dollar amounts at date of valuation.
Purchases and sales of securities and income items denominated in foreign
currencies are translated in U.S. dollar amounts on the respective dates of such
transactions. When the International Equity Portfolio purchases or sells a
foreign security it may enter into a foreign exchange currency contract to
minimize market risk from the trade date to the settlement date of such
transaction. Such foreign exchange currency contracts are marked to market
daily.
The International Equity Portfolio does not separately report the results of
operations resulting from changes in foreign exchange rates on investments from
the fluctuations arising from changes in market prices of securities held. Such
fluctuations are included with the net realized and unrealized gain or loss from
investments.
Net realized foreign exchange gains or losses arise from sales of foreign
currencies, currency gains or losses realized between the trade date and
settlement date on security transactions, the differences between the amounts of
dividends and foreign withholding taxes recorded on the portfolio's books, and
the U.S. dollar equivalent of the amounts actually received or paid.
Note 6 -- The Index 500 Stock and Balanced Portfolios invest in futures
contracts as an alternative to investing in individual securities. The Index 500
Stock and Balanced Portfolios could be exposed to market risk due to changes in
the value of the underlying securities or due to an illiquid secondary market.
Futures contracts are marked to market daily based upon quoted settlement
prices. The Portfolios receive from or pay to brokers an amount of cash equal to
the daily fluctuation in the value of the contracts. Such receipts or payments
are known as "variation margin" and are recorded by the Portfolios as unrealized
gains or losses. When the contract is closed, the Portfolios record a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
Note 7 -- Interest income and discounts earned are recorded daily on the accrual
basis and dividend income is recorded on the ex-dividend date or as soon as
information from foreign issuers is available. Where applicable, dividends are
recorded net of foreign dividend tax. Discounts and premiums on securities
purchased are amortized over the life of the respective securities when required
for federal income tax purposes. Securities transactions are accounted for on
the day following the trade date except for money market investments which are
accounted for on the trade date. The basis for determining cost on sale of
securities is identified cost. For the year ended December 31, 1995,
transactions in securities other than money market investments were:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1995
--------------------------------------------------------------------
TOTAL U.S. GOVT TOTAL U.S. GOVT
SECURITY SECURITY SECURITY SECURITY
PORTFOLIOS PURCHASES PURCHASES SALES/MATURITIES SALES/MATURITIES
- ------------------------------------------ ------------ ------------ ---------------- ----------------
<S> <C> <C> <C> <C>
Index 500 Stock........................... $ 59,878,287 $ 0 $ 12,044,408 $ 0
Growth Stock.............................. 54,517,879 0 26,767,578 0
Growth and Income Stock................... 121,075,856 0 77,346,645 0
Aggressive Growth Stock................... 260,690,662 0 154,803,016 0
International Equity...................... 89,477,772 2,897,648 75,620,620 0
Select Bond............................... 109,814,276 65,552,594 107,754,401 69,226,521
High Yield Bond........................... 68,073,739 0 50,808,496 0
Balanced.................................. 714,367,753 436,056,565 588,378,994 358,907,270
</TABLE>
48
<PAGE> 52
NORTHWESTERN MUTUAL SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
Note 8 -- The Series Fund and its Portfolios are parties to annually renewable
contracts pursuant to which each Portfolio pays a charge for investment
management and administrative services. Each Portfolio pays a monthly fee for
these investment advisory services at an annual rate based on the average daily
net asset values of each Portfolio. For the Index 500 Stock Portfolio the rate
is .20%, and for the Select Bond, Money Market and Balanced Portfolios the rate
is .30%. For the other Portfolios the rate for the investment advisory fee is
graded by the asset size of the Portfolio according to the following schedule:
<TABLE>
<CAPTION>
PORTFOLIO FIRST $50 MILLION NEXT $50 MILLION EXCESS
- ---------------------------------------------------------------- ----------------- ---------------- ------
<S> <C> <C> <C>
Growth Stock.................................................... .60% .50% .40%
Growth and Income Stock......................................... .70% .60% .55%
Aggressive Growth Stock......................................... .80% .65% .50%
International Equity............................................ .85% .65% .65%
High Yield Bond................................................. .60% .50% .40%
</TABLE>
These amounts are paid to Northwestern Mutual Investment Services, Inc. ("NMIS")
a wholly-owned subsidiary of Northwestern Mutual Life, which is the manager and
investment adviser of the Fund. Northwestern Mutual Life is also a party to the
agreement. Other costs for each Portfolio are paid either by the Portfolios,
Northwestern Mutual Life, or NMIS depending upon the applicable agreement in
place.
J.P. Morgan Investment Management, Inc. ("J.P. Morgan") and Templeton Investment
Counsel, Inc. ("Templeton Counsel") have been retained under an investment
sub-advisory agreement to provide investment advice and, in general, to conduct
the management investment program of the Growth and Income Stock Portfolio and
the International Equity Portfolio, respectively. Of the advisory fees received
by NMIS from the Growth and Income Stock Portfolio, .45% on the first $100
million of the Portfolio's net assets, .40% on the next $100 million, .35% on
the next $200 million and .30% on the net assets in excess of $400 million will
be paid by NMIS to J.P. Morgan. Of the advisory fees received by NMIS from the
International Equity Portfolio, .50% on the first $100 million of the
Portfolio's net assets and .40% on net assets in excess of $100 million will be
paid by NMIS to Templeton Counsel.
Note 9 -- The Series Fund has elected to be taxed as a regulated investment
company meeting certain requirements under the Internal Revenue Code. Since it
expects to distribute all net investment income and net realized capital gains,
the Series Fund anticipates incurring no federal income taxes. A net realized
capital loss of $1,337,853 in the Select Bond Portfolio carried forward from
1994 and is available to offset future net realized capital gains. The amount
expires in 2002. A capital loss carryforward of $366,657 was utilized in the
Select Bond Portfolio during the year ended December 31, 1995. As of December
31, 1995, the federal income tax basis of investments is the same as the cost
basis in the financial statements except for the International Equity Portfolio.
The federal income tax basis of investments was $312,572,728 for the
International Equity Portfolio. The net unrealized appreciation (depreciation)
and the gross unrealized appreciation (depreciation) for federal income tax
purposes are shown below:
<TABLE>
<CAPTION>
(IN THOUSANDS)
GROWTH AND
GROWTH INCOME AGGRESSIVE
INDEX 500 STOCK STOCK GROWTH STOCK
STOCK PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------------- --------- ---------- ------------
<S> <C> <C> <C> <C>
Gross unrealized appreciation......................... $ 131,032 $ 13,742 $ 16,575 $186,905
Gross unrealized depreciation......................... (7,615) (759) (3,381) (4,632)
--------- -------- -------- --------
Net unrealized appreciation........................... $ 123,417 $ 12,983 $ 13,194 $182,273
========= ======== ======== ========
</TABLE>
<TABLE>
<CAPTION>
INTERNATIONAL HIGH YIELD
EQUITY SELECT BOND BOND BALANCED
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------- ----------- ---------- --------
<S> <C> <C> <C> <C>
Gross unrealized appreciation............................ $ 42,706 $ 8,819 $ 2,058 $355,306
Gross unrealized depreciation............................ (17,098) (48) (1,824) (23,182)
--------- ------- -------- --------
Net unrealized appreciation.............................. $ 25,608 $ 8,771 $ 234 $332,124
========= ======= ======== ========
</TABLE>
49
<PAGE> 53
NORTHWESTERN MUTUAL SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
Taxable distributions from net investment income and realized capital gains in
the International Equity Portfolio differ from book amounts earned during the
period due to differences in the timing of capital recognition and due to the
reclassification of certain gains or losses from capital to income.
For Federal income tax purposes, net unrealized appreciation (depreciation) of
$748,075 and ($1,257,850) on open futures contracts for the Index 500 Stock and
Balanced Portfolios, respectively, is required to be treated as realized gains
and losses.
Note 10 -- The costs associated with organizing the five new Portfolios and
certain other initial period costs have been incurred by Northwestern Mutual
Life. The Series Fund is not obligated to repay these costs.
Note 11 -- Dividends from net investment income and net realized capital gains
are declared each year for the Index 500 Stock, Growth Stock, Growth and Income
Stock, Aggressive Growth Stock, International Equity, Select Bond, High Yield
Bond and Balanced Portfolios and each business day for the Money Market
Portfolio. Dividend distributions are described below.
A dividend was declared on May 2, 1995, payable to shareholders of record on May
2, 1995. Dividends paid from 1994 net investment income and 1994 net capital
gains were as follows:
<TABLE>
<CAPTION>
NET
INVESTMENT NET
PORTFOLIOS INCOME CAPITAL GAINS
- --------------------------------------------------------------------------- ----------- -------------
<S> <C> <C>
Index 500 Stock............................................................ $ 64,846 --
Growth Stock............................................................... 6,489 --
Growth and Income Stock.................................................... 4,761 $ 101,563
Aggressive Growth Stock.................................................... 502,448 1,836,281
International Equity....................................................... -- 2,170,803
Select Bond................................................................ 63,551 --
High Yield Bond............................................................ 18,833 --
Balanced................................................................... 53,159,765 8,178,849
</TABLE>
A dividend was declared on June 26, 1995, payable to shareholders of record on
June 26, 1995. Dividends were paid from 1995 net investment income and were as
follows:
<TABLE>
<CAPTION>
NET
INVESTMENT NET
PORTFOLIOS INCOME CAPITAL GAINS
- ---------------------------------------------------------------------------- ---------- -------------
<S> <C> <C>
Index 500 Stock............................................................. $3,829,315 --
Growth Stock................................................................ 459,372 --
Growth and Income Stock..................................................... 636,176 --
Select Bond................................................................. 4,645,196 --
High Yield Bond............................................................. 1,670,096 --
</TABLE>
A dividend was declared on December 27, 1995, payable to shareholders of record
on December 27, 1995. Dividends paid from 1995 net investment income and 1995
net capital gains were as follows:
<TABLE>
<CAPTION>
NET
INVESTMENT NET
PORTFOLIOS INCOME CAPITAL GAINS
- ---------------------------------------------------------------------------- ---------- -------------
<S> <C> <C>
Growth Stock................................................................ $ 638,679 $ 1,581,810
Growth and Income Stock..................................................... 1,026,485 6,333,885
High Yield Bond............................................................. 2,914,721 464,661
</TABLE>
Note 12 -- (Unaudited) A Special Meeting of the stockholders of Northwestern
Mutual Series Fund, Inc. was held at 720 East Wisconsin Avenue, Milwaukee,
Wisconsin, on March 29, 1995.
50
<PAGE> 54
NORTHWESTERN MUTUAL SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
The stockholders cast the following votes on the resolutions presented:
BE IT RESOLVED, that the following persons are nominated and elected as
Directors of the Corporation to serve for the term provided in the By-Laws:
<TABLE>
<CAPTION>
FOR ABSTAIN
<S> <C> <C>
Stephen N. Graff 2,270,116,766.25 102,692,132.73
John K. MacIver 2,266,153,929.25 106,654,969.73
Martin F. Stein 2,268,092,761.36 104,716,137.62
James D. Ericson 2,270,768,173.35 102,040,725.63
William J. Blake 2,268,894,605.36 103,914,293.62
</TABLE>
BE IT RESOLVED, that the selection of Price Waterhouse LLP, independent
accountants, as auditors of the Corporation is hereby ratified.
YES 2,266,641,454.01 NO 28,050,550.26 ABSTAIN 78,116,894.71
BE IT RESOLVED, that the investment advisory agreement between the Corporation,
NMIS and The Northwestern Mutual Life Insurance Company for the Growth and
Income Stock Portfolio is hereby approved and that the investment sub-advisory
agreement between the Corporation, NMIS and J.P. Morgan Investment Management,
Inc. for the Growth and Income Stock Portfolio is hereby approved.
YES 62,729,865.96 NO 703,277.71 ABSTAIN 2,324,267.25
BE IT RESOLVED, that the investment advisory agreement between the Corporation,
NMIS and The Northwestern Mutual Life Insurance Company for the Growth Stock
Portfolio is hereby approved.
YES 39,112,648.85 NO 1,136,499.86 ABSTAIN 1,658,855.64
BE IT RESOLVED, that the investment advisory agreement between the Corporation,
NMIS and The Northwestern Mutual Life Insurance Company for the Aggressive
Growth Stock Portfolio is hereby approved.
YES 153,485,939.4 NO 2,613,557.91 ABSTAIN 7,528,159.97
BE IT RESOLVED, that the investment advisory agreement between the Corporation,
NMIS and The Northwestern Mutual Life Insurance Company for the High Yield Bond
Portfolio is hereby approved.
YES 34,244,453.77 NO 156,184.39 ABSTAIN 2,189,223.37
BE IT RESOLVED, that the investment advisory agreement between the Corporation,
NMIS and The Northwestern Mutual Life Insurance Company for the International
Equity Portfolio is hereby approved and that the investment sub-advisory
agreement between NMIS and Templeton Investment Counsel, Inc. for the
International Equity Portfolio is hereby approved.
YES 231,607,721.07 NO 3,840,003.82 ABSTAIN 10,160,909.98
51
<PAGE> 55
NORTHWESTERN MUTUAL SERIES FUND, INC.
INDEX 500 STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
COMMON STOCK (94.1%)
AEROSPACE (2.2%)
Boeing Company 34,700 $ 2,720
E G & G, Inc. 5,300 129
General Dynamics Corporation 6,400 378
Lockheed Martin Corporation 20,254 1,600
Loral Corporation 17,300 612
McDonnell Douglas Corporation 11,400 1,049
Northrop Corporation 5,000 320
Raytheon Company 24,700 1,166
Rockwell International Corp. 22,000 1,162
TRW Inc. 6,600 511
United Technologies Corp. 12,500 1,186
--------
Total 10,833
--------
AIRLINES (0.3%)
*AMR Corporation 7,700 572
Delta Air Lines, Inc. 5,100 377
Southwest Airlines Co. 14,500 337
*USAir Group, Inc. 6,300 83
--------
Total 1,369
--------
APPAREL, TEXTILES AND FOOTWEAR (0.4%)
Brown Group, Inc. 1,800 26
*Fruit of the Loom Incorporated 7,700 188
Liz Claiborne, Inc. 7,600 211
Nike, Inc. 14,500 1,010
Reebok International Ltd. 7,900 223
Russell Corp. 3,900 108
Springs Industries, Inc. 2,000 83
Stride Rite Corp. 4,900 37
VF Corporation 6,500 343
--------
Total 2,229
--------
AUTO & TRUCKS (1.9%)
Chrysler Corporation 38,700 2,143
Ford Motor Company 108,700 3,152
General Motors Corporation 75,600 3,997
*Navistar International Corp. 7,600 80
PACCAR Incorporated 3,935 166
--------
Total 9,538
--------
AUTO RELATED (0.6%)
Cooper Tire & Rubber Company 8,500 209
Dana Corporation 10,200 298
Eaton Corporation 7,900 424
Echlin Inc. 6,000 219
Genuine Parts Company 12,400 508
Goodyear Tire & Rubber Company 15,400 699
ITT Industries Inc. 11,700 281
Snap-On Incorporated 4,100 186
--------
Total 2,824
--------
BANKS (6.2%)
Banc One Corporation 39,950 1,508
Bank of Boston Corporation 11,300 523
Bank of New York Company Inc. 19,400 946
BankAmerica Corporation 37,900 2,454
Bankers Trust New York Corp. 7,900 525
Barnett Banks Inc. 9,800 578
Boatmans Bancshares, Inc. 12,700 519
Chase Manhattan Corporation 17,700 1,073
Chemical Banking Corporation 25,500 1,498
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
BANKS (CONTINUED)
Citicorp 43,000 $ 2,892
Comerica, Inc. 11,600 465
Corestates Financial Corp. 14,100 534
First Bank System Inc. 13,700 680
First Chicago NBD Corp. 32,128 1,269
First Fidelity Bancorporation 8,100 611
First Interstate Bancorp 7,700 1,051
First Union Corporation 17,400 968
Fleet Financial Group Inc. 25,930 1,057
KeyCorp 23,000 834
Mellon Bank Corporation 14,850 798
J.P. Morgan & Company, Inc. 19,000 1,525
National City Corp. 14,900 494
NationsBank Corp. 27,500 1,915
Norwest Corporation 35,700 1,178
PNC Financial Corp. 23,300 751
P P & L Resources Inc. 16,000 400
Republic New York Corporation 5,700 354
Suntrust Banks Inc. 11,600 795
U.S. Bancorp of Oregon 9,900 333
Wachovia Corporation 17,300 791
Wells Fargo & Company 4,900 1,058
--------
Total 30,377
--------
BEVERAGES (3.5%)
Anheuser-Busch Companies Inc. 25,900 1,732
Brown-Forman Corp. 7,000 255
Coca-Cola Company 127,600 9,474
Adolph Coors Co. 3,800 84
Pepsico Inc. 79,700 4,453
Seagram Company Ltd. 37,700 1,305
--------
Total 17,303
--------
BUILDING & CONSTRUCTION (0.3%)
Centex Corporation 2,800 97
Crane Co. 3,100 114
Kaufman & Broad Home Corp. 3,200 48
Masco Corporation 16,000 502
*Owens-Corning Fiberglas Corp. 5,100 229
Pulte Corporation 2,700 91
Sherwin-Williams Company 8,600 350
--------
Total 1,431
--------
BUILDING-FOREST PRODUCTS (0.5%)
Boise Cascade Corporation 4,800 166
Champion International 9,800 412
Georgia-Pacific Corp. 9,200 631
Louisiana Pacific Corporation 10,900 264
Potlatch Corporation 3,000 120
Weyerhaeuser Company 20,600 891
--------
Total 2,484
--------
CHEMICALS (2.8%)
Air Products & Chemicals, Inc. 11,300 596
Dow Chemical Company 27,200 1,914
E.I. du Pont de Nemours & Co. 56,200 3,928
Eastman Chemical Company 8,225 515
Ecolab, Inc. 6,500 195
*FMC Corporation 3,700 250
Freeport McMoRan Copper & Gold, Inc. 20,600 579
</TABLE>
52
<PAGE> 56
NORTHWESTERN MUTUAL SERIES FUND, INC.
INDEX 500 STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
COMMON STOCK (CONTINUED)
CHEMICALS (CONTINUED)
B.F. Goodrich Company 2,600 $ 177
W.R. Grace & Co. 9,600 568
Great Lakes Chemical 6,600 475
Hercules Incorporated 11,300 637
Mallinckrodt Group 7,800 284
Monsanto Company 11,700 1,433
PPG Industries Inc. 20,500 938
Praxair, Inc. 14,000 471
Rohm & Haas Company 6,800 438
Union Carbide Corporation 13,900 521
--------
Total 13,919
--------
CHEMICALS-SPECIALITY (0.3%)
Avery Dennison Corp. 5,400 271
Engelhard Corp. 14,502 315
Morton International, Inc. 15,000 538
Nalco Chemical Company 6,800 205
Sigma-Aldrich Corp. 5,000 247
--------
Total 1,576
--------
COAL, GAS AND PIPELINE (0.1%)
Eastern Enterprises 2,000 70
NACCO Industries, Inc. 900 50
Sonat Inc. 8,700 310
--------
Total 430
--------
CONTAINERS (0.1%)
Ball Corporation 3,000 82
Bemis Company, Inc. 5,200 133
*Crown Cork & Seal Company, Inc. 9,100 380
--------
Total 595
--------
DIVERSIFIED (2.0%)
Allied Signal Inc. 28,700 1,363
Corning Inc. 23,300 746
Dial Corp. 9,400 278
ITT Corp. 11,700 620
Loews Corp. 11,900 933
Minnesota Mining & Manufacturing
Co. 42,500 2,816
National Service Industries, Inc. 4,900 159
Ogden Corporation 4,900 105
*Teledyne, Inc. 5,600 143
Tenneco Inc. 18,300 908
Textron Inc. 8,600 580
Tyco Laboratories, Inc. 15,500 552
Whitman Corporation 10,600 246
Worthington Industries 9,150 190
--------
Total 9,639
--------
DRUGS (6.1%)
*Alza Corp. 8,300 205
American Home Products Corp. 31,400 3,046
*Amgen Inc. 26,800 1,591
Bristol-Myers Squibb Company 51,300 4,405
Eli Lilly & Company 55,800 3,139
Merck & Co., Inc. 125,200 8,232
Pharmacia & Upjohn Inc. 51,005 1,976
Pfizer Inc. 63,900 4,026
Schering-Plough Corporation 37,700 2,064
Warner-Lambert Company 13,600 1,321
--------
Total 30,005
--------
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
ELECTRICAL EQUIPMENT (3.3%)
Emerson Electric Co. 22,700 $ 1,856
General Electric Company 171,400 12,341
W.W. Grainger, Inc. 5,100 338
Honeywell Inc. 12,900 627
Raychem Corp. 4,400 250
Thomas & Betts Corporation 2,000 147
Westinghouse Electric Corp. 39,700 655
--------
Total 16,214
--------
ELECTRONICS (1.9%)
*Advanced Micro Devices, Inc. 10,500 173
AMP Incorporated 21,972 843
*Applied Materials Inc. 17,900 705
Harris Corporation 3,900 213
Intel Corp. 83,300 4,727
*LSI Logic 13,000 426
Micron Technology 20,900 828
*National Semiconductor Corp. 12,500 278
Perkin-Elmer Corporation 4,200 159
Tektronix, Inc. 3,400 167
Texas Instruments Incorporated 19,000 983
--------
Total 9,502
--------
ENGINEERING & CONSTRUCTION (0.1%)
Fluor Corporation 8,400 554
--------
ENVIRONMENTAL CONTROL (0.6%)
Browning-Ferris Industries Inc. 21,500 634
Johnson Controls Inc. 4,100 282
Laidlaw Transportation Limited 29,800 305
Millipore Corp. 4,500 185
Safety-Kleen Corp. 5,700 89
WMX Technologies, Inc. 49,100 1,467
--------
Total 2,962
--------
FEDERAL GOVERNMENT AGENCY RELATED (1.0%)
Federal Home Loan Mortgage Corp. 18,300 1,528
Federal National Mortgage Assoc. 27,600 3,426
--------
Total 4,954
--------
FINANCIAL SERVICES (1.9%)
American Express Company 49,400 2,044
Beneficial Corp. 5,400 252
Dean Witter, Discover & Co. 17,100 804
Household International Inc. 9,900 585
MBNA Corp. 15,000 553
Marsh & McLennan Companies, Inc. 7,300 648
Merrill Lynch & Co., Inc. 17,800 908
Morgan Stanley Group Inc. 7,800 629
Salomon Inc. 10,800 383
Transamerica Corporation 6,900 503
Travelers Group Inc. 32,333 2,033
--------
Total 9,342
--------
FOOD SERVICE/LODGING(1.0%)
*Darden Restaurant Inc. 16,000 190
*Harrah's Entertainment 10,400 252
Hilton Hotels Corporation 4,900 301
</TABLE>
53
<PAGE> 57
NORTHWESTERN MUTUAL SERIES FUND, INC.
INDEX 500 STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
COMMON STOCK (CONTINUED)
FOOD SERVICE/LODGING (CONTINUED)
Luby's Cafeterias, Inc. 2,300 $ 51
Marriott International 12,700 486
McDonald's Corporation 70,300 3,172
*Ryan's Family Steak Houses, Inc. 5,300 37
*Shoney's Inc. 4,100 42
Wendy's International, Inc. 10,400 221
--------
Total 4,752
--------
FOODS (3.0%)
Archer Daniels Midland Company 54,877 988
CPC International Corp. 14,800 1,016
Campbell Soup Company 25,300 1,518
ConAgra Inc. 24,900 1,027
General Mills, Inc. 16,000 924
H.J. Heinz Company 36,950 1,224
Hershey Foods Corp. 7,900 513
Kellogg Company 22,200 1,715
Pioneer Hi-Bred International 8,500 473
Quaker Oats Company 13,600 469
Ralston Purina Group 10,500 655
Sara Lee Corporation 48,500 1,546
Unilever, N.V. 16,200 2,280
Wm. Wrigley Jr. Company 11,800 619
--------
Total 14,967
--------
HOSPITAL SUPPLIES (3.9%)
Abbott Laboratories Inc. 80,300 3,353
Allergan Incorporated 6,500 211
Allergan Incorporated -- Rights 183 0
C.R. Bard, Inc. 5,600 181
Bausch & Lomb Inc. 5,800 230
Baxter International Inc. 28,000 1,173
Becton, Dickinson & Company 6,700 502
*Beverly Enterprises, Inc. 9,900 105
*Biomet, Inc. 11,700 209
*Boston Scientific Corp. 16,400 804
Columbia/HCA Healthcare
Corporation 44,900 2,279
*Community Psychiatric Centers 4,300 53
Humana, Inc. 16,400 449
Johnson & Johnson 65,300 5,591
Manor Care, Inc. 6,300 221
Medtronic, Incorporated 23,400 1,307
St. Jude Medical, Inc. 7,100 305
*Tenet Healthcare Corp. 20,200 419
United Healthcare Corp. 17,600 1,153
U.S. HealthCare Incorporated 15,600 725
U.S. Surgical Corporation 5,800 124
--------
Total 19,394
--------
HOUSEHOLD FURNITURE/APPLIANCES (0.5%)
Armstrong World Industries, Inc. 3,800 236
Black & Decker Corporation 8,700 307
Maytag Corporation 10,900 221
Newell Co. 16,000 414
Premark International, Inc. 6,400 324
Rubbermaid, Inc. 16,000 408
Stanley Works 4,500 232
Whirlpool Corporation 7,500 399
--------
Total 2,541
--------
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
INSURANCE (2.9%)
Aetna Life & Casualty Company 11,500 $ 796
Alexander & Alexander Services 4,400 84
Allstate Corporation 45,414 1,868
American General Corporation 20,700 722
American International Group,
Inc. 47,950 4,435
CIGNA Corporation 7,300 754
Chubb Corporation 8,800 851
General Re Corporation 8,300 1,287
ITT Hartford Group 11,700 566
Jefferson-Pilot Corp. 7,200 335
Lincoln National Corporation 10,500 564
Providian Corporation 9,600 391
SAFECO Inc. 12,700 438
St. Paul Companies, Inc. 8,600 478
Torchmark Corporation 7,200 326
UNUM Corporation 7,300 402
USF&G Corp. 11,300 191
USLIFE Corporation 3,450 103
--------
Total 14,591
--------
LEISURE RELATED (1.5%)
*3COM Corp. 16,800 783
*Bally Entertainment Corporation 4,600 64
Brunswick Corporation 9,700 233
Walt Disney Company 52,700 3,109
Fleetwood Enterprises, Inc. 4,700 121
Handlemann Co. 3,300 19
Hasbro Inc. 8,900 276
*King World Productions, Inc. 3,700 144
Mattel, Inc. 22,431 690
Outboard Marine Corporation 2,000 41
*Viacom Incorporated 36,556 1,677
--------
Total 7,157
--------
MACHINERY (1.2%)
Briggs & Stratton Corporation 3,000 130
Caterpillar Inc. 20,100 1,181
Cincinnati Milacron Inc. 3,400 89
Cooper Industries, Inc. 10,900 401
Cummins Engine Company, Inc. 4,100 152
Deere & Company 26,300 927
Dover Corporation 11,500 424
Foster Wheeler Corporation 4,100 174
General Signal Corporation 4,800 155
Giddings & Lewis Company 3,400 56
Harnischfeger Industries, Inc. 4,900 163
Illinois Tool Works Inc. 11,900 702
Ingersoll-Rand Company 10,700 376
Pall Corporation 11,600 312
Parker-Hannifin Corporation 7,450 255
Timken Company 3,100 119
TRINOVA Corp. 2,900 83
*Varity Corporation 4,100 152
--------
Total 5,851
--------
MEDIA (0.7%)
Capital Cities/ABC, Inc. 15,600 1,925
Comcast Corp. 24,250 441
*Tele-Communications, Inc. 66,100 1,314
--------
Total 3,680
--------
</TABLE>
54
<PAGE> 58
NORTHWESTERN MUTUAL SERIES FUND, INC.
INDEX 500 STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
COMMON STOCK (CONTINUED)
METALS & MINING (1.2%)
Alcan Aluminum Limited 22,800 $ 710
Aluminum Co. of America 18,100 957
ASARCO, Inc. 4,300 138
Barrick Gold Corporation 35,800 944
Cyprus Minerals Co. 9,350 244
Echo Bay Mines Limited Co. 11,400 118
Homestake Mining Company 14,000 219
Inco Limited 12,000 399
Newmont Mining Corporation 8,688 393
Phelps Dodge Corporation 7,000 436
Placer Dome Incorporated 24,200 584
Reynolds Metals Company 6,400 362
Santa Fe Pacific Gold Corporation 13,260 161
--------
Total 5,665
--------
OFFICE EQUIPMENT (3.9%)
*Amdahl Corporation 12,000 102
Apple Computer, Inc. 12,300 392
*Cabletron Systems Inc. 7,200 583
*Cisco Systems Incorporated 27,500 2,052
*Compaq Computer Corporation 26,700 1,282
*Cray Research, Inc. 2,500 62
*Data General Corporation 3,700 51
*Digital Equipment Corporation 14,900 955
Hewlett-Packard Company 51,800 4,338
*Intergraph Corp. 4,700 74
International Business Machines
Corp. 57,600 5,285
Moore Corporation Ltd. 10,100 188
Pitney Bowes Inc. 15,300 719
*Silicon Graphics 16,000 440
*Sun Microsystems Inc. 19,300 881
*Tandem Computers Inc. 11,800 125
*Unisys Corporation 17,300 97
Xerox Corporation 10,900 1,493
--------
Total 19,119
--------
OFFICE EQUIPMENT-SERVICES (2.6%)
Alco Standard Corporation 11,300 516
Autodesk, Inc. 4,800 164
Automatic Data Processing, Inc. 14,600 1,084
*Ceridian Corp. 6,700 276
Computer Associates International
Inc. 24,350 1,385
*Computer Sciences Corp. 5,600 393
First Data Corporation 22,300 1,491
*Microsoft Corporation 59,300 5,204
*Novell, Inc. 37,400 533
*Oracle Corporation 43,900 1,860
Shared Medical Systems Corp. 2,300 125
--------
Total 13,031
--------
OIL & GAS-DOMESTIC (1.4%)
Amerada Hess Corporation 9,400 498
Ashland, Inc. 6,400 225
Atlantic Richfield Company 16,300 1,805
Burlington Resource Inc. 12,800 502
Coastal Corp. 10,600 395
Kerr-McGee Corporation 5,200 330
Louisiana Land & Exploration Co. 3,400 146
Occidental Petroleum Corporation 32,200 688
*Oryx Energy Company 10,500 140
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
OIL & GAS-DOMESTIC (CONTINUED)
Pennzoil Company 4,700 $ 199
Phillips Petroleum Company 26,500 904
*Santa Fe Energy Resources, Inc. 9,100 88
Sun Company, Inc. 7,600 208
Unocal Corp. 24,900 725
--------
Total 6,853
--------
OIL & GAS-INTERNATIONAL (6.3%)
Amoco Company 50,200 3,608
Chevron Corp. 66,000 3,465
Exxon Corporation 125,700 10,072
Mobil Corporation 40,000 4,480
Royal Dutch Petroleum Co., ADR 54,200 7,649
Texaco Inc. 26,300 2,065
--------
Total 31,339
--------
OIL FIELD SERVICES (0.7%)
Baker Hughes Inc. 14,300 349
Dresser Industries, Inc. 18,500 451
Halliburton Company 11,600 587
Helmerich & Payne, Inc. 2,500 74
McDermott International, Inc. 5,500 121
*Rowan Companies, Inc. 8,400 83
Schlumberger Limited 24,500 1,697
*Western Atlas Inc. 5,400 273
--------
Total 3,635
--------
PAPER (1.1%)
Federal Paper Board, Inc. 4,600 239
International Paper Company 25,800 977
James River Corp. of Virginia 8,300 200
Kimberly-Clark Corporation 28,222 2,336
Mead Corp. 5,400 282
*Stone Container Corporation 9,700 139
Temple-Inland Inc. 5,700 252
Union Camp Corporation 7,100 338
Westvaco Corporation 10,250 284
Willamette Industries Inc. 5,600 315
--------
Total 5,362
--------
PHOTO & OPTICAL (0.5%)
Eastman Kodak Company 34,600 2,318
Polaroid Corporation 4,600 218
--------
Total 2,536
--------
PRINTING & PUBLISHING (1.5%)
American Greetings Corp. 7,500 207
Deluxe Corp. 8,400 244
R.R. Donnelley & Sons Company 15,500 610
Dow Jones & Company, Inc. 9,800 391
Dun & Bradstreet Corporation 17,100 1,107
Gannett Company, Inc. 14,200 872
Harcourt General 7,400 310
John H. Harland Company 3,000 63
Jostens, Inc. 3,900 95
Knight-Ridder Inc. 5,000 313
McGraw-Hill, Inc. 5,100 444
Meredith Corporation 2,800 117
New York Times Company 9,800 290
Time Warner Inc. 39,100 1,481
Times Mirror Company 11,300 383
</TABLE>
55
<PAGE> 59
NORTHWESTERN MUTUAL SERIES FUND, INC.
INDEX 500 STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
COMMON STOCK (CONTINUED)
PRINTING & PUBLISHING (CONTINUED)
Tribune Company 6,600 $ 403
--------
Total 7,330
--------
PROFESSIONAL SERVICES (0.4%)
H & R Block, Inc. 10,600 429
*CUC International Inc. 17,650 602
Interpublic Group of Cos., Inc. 7,900 343
Service Corporation International 10,500 462
--------
Total 1,836
--------
RAILROADS (1.0%)
Burlington Northern Santa Fe Co. 14,407 1,124
CSX Corporation 21,200 967
Conrail Incorporated 7,900 553
Norfolk Southern Corporation 13,300 1,056
Union Pacific Corporation 20,800 1,373
--------
Total 5,073
--------
RETAIL-FOOD (0.7%)
Albertson's, Inc. 25,700 845
American Stores Co. 15,000 401
Fleming Companies, Inc. 3,800 78
Giant Food Inc. 6,000 189
Great Atlantic & Pacific Tea Co.,
Inc. 3,800 87
*Kroger Company 12,400 465
Supervalu Inc. 6,900 217
Sysco Corporation 18,500 601
Winn-Dixie Stores, Inc. 15,300 564
--------
Total 3,447
--------
RETAIL-GENERAL (3.8%)
Charming Shoppes Incorporated 10,100 29
Circuit City Stores, Inc. 9,800 271
Dayton Hudson Corporation 7,300 548
Dillard Department Stores, Inc. 11,400 325
*Federated Department Stores, Inc. 20,500 564
The Gap, Inc. 14,600 613
Home Depot, Inc. 48,199 2,308
K Mart Corporation 46,400 336
The Limited Inc. 36,200 629
Longs Drug Stores Corp. 2,100 101
Lowe's Companies, Inc. 16,200 543
May Department Stores Company 25,200 1,065
Melville Corporation 10,600 326
Mercantile Stores Company 3,700 171
Nordstrom, Inc. 8,300 336
J.C. Penney Company, Inc. 23,000 1,095
Pep Boys - Manny, Moe & Jack 6,200 159
*Price/Costco, Inc. 19,707 301
Rite Aid Corporation 8,500 291
Sears, Roebuck & Company 39,400 1,537
TJX Companies, Inc. 7,300 138
Tandy Corporation 6,600 274
*Toys "R" Us 28,000 609
Wal-Mart Stores, Inc. 232,500 5,202
Walgreen Company 24,900 744
*Woolworth Corp. 13,400 174
--------
Total 18,689
--------
SAVINGS & LOAN (0.2%)
H.F. Ahmanson & Company 11,900 315
Golden West Financial Corp. 5,900 326
Great Western Financial Corp. 13,800 352
--------
Total 993
--------
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
SOAPS & TOILETRIES (2.2%)
Alberto-Culver Company 2,800 $ 96
Avon Products, Inc. 6,900 520
The Clorox Company 5,400 387
Colgate-Palmolive Co. 14,700 1,033
Gillette Company 44,900 2,340
International Flavors &
Fragrances, Inc. 11,300 542
The Procter & Gamble Company 69,600 5,777
--------
Total 10,695
--------
STEEL (0.3%)
*Armco Inc. 10,400 61
Bethlehem Steel Corporation 11,200 157
Inland Steel Industries, Inc. 4,900 123
Nucor Corp. 8,800 503
USX-Marathon Group 30,100 587
USX-U S Steel Group Inc. 8,300 255
--------
Total 1,686
--------
TELECOMMUNICATIONS (3.2%)
AT&T Corporation 160,500 10,392
*Andrew Corporation 3,950 151
Cox Communications 2 0
*DSC Communications Corp. 11,600 428
Motorola, Inc. 59,700 3,403
Northern Telecom Limited 25,700 1,105
Scientific-Atlanta, Inc. 7,800 117
*Tellabs Inc. 8,900 329
--------
Total 15,925
--------
TOBACCO (1.9%)
American Brands, Inc. 19,100 852
Philip Morris Companies, Inc. 85,000 7,693
UST Incorporated 19,800 661
--------
Total 9,206
--------
TRANSPORTATION-MISC. (0.0%)
Pittston Services Group 4,200 132
--------
TRUCKING-SHIPPING (0.2%)
Caliber Systems Inc. 4,000 196
Consolidated Freightways, Inc. 4,400 117
*Federal Express Corp. 5,700 421
Ryder System, Inc. 8,000 198
Yellow Corp. 2,800 35
--------
Total 967
--------
UTILITY-ELECTRIC (3.5%)
American Electric Power Co., Inc. 18,800 761
Baltimore Gas & Electric Co. 14,900 425
Carolina Power & Light Company 15,700 542
Central & South West Corporation 19,400 541
Cinergy Corporation 15,817 484
Consolidated Edison Co. of New
York 23,800 762
Detroit Edison Company 14,900 514
Dominion Resources Inc. 17,600 726
Duke Power Company 20,700 981
</TABLE>
56
<PAGE> 60
NORTHWESTERN MUTUAL SERIES FUND, INC.
INDEX 500 STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
COMMON STOCK (CONTINUED)
UTILITY-ELECTRIC (CONTINUED)
Entergy Corporation 23,000 $ 673
FPL Group, Inc. 18,700 867
General Public Utilities 11,800 401
Houston Industries Incorporated 26,600 645
Niagara Mohawk Power Corporation 14,600 141
Northern States Power Company 6,900 339
Ohio Edison Company 15,400 362
PECO Energy Company 22,500 678
Pacific Enterprises 8,600 243
Pacific Gas & Electric Co. 42,900 1,217
PacifiCorp 28,800 612
Public Service Enterprise Group,
Inc. 24,800 760
SCECorp 45,100 801
Southern Company 67,400 1,660
Texas Utilities Company 22,900 942
UNICOM Corp. 21,700 711
Union Electric Company 10,300 430
--------
Total 17,218
--------
UTILITY-GAS (0.6%)
*Columbia Gas System Inc. 5,100 224
Consolidated Natural Gas Co. 9,400 427
Enron Corp. 25,500 972
ENSERCH Corporation 6,900 112
Nicor Inc. 5,100 140
Noram Energy Corporation 12,500 111
ONEOK, Inc. 2,700 62
Panhandle Eastern Corporation 15,200 424
Peoples Energy Corporation 3,500 111
Williams Companies, Inc. 10,300 452
--------
Total 3,035
--------
UTILITY-TELEPHONE (6.1%)
*Airtouch Communications 50,000 1,413
ALLTEL Corp. 19,100 563
Ameritech Corporation 56,100 3,310
<CAPTION>
MARKET
SHARES/ VALUE
PAR (000'S)
---------- --------
<S> <C> <C>
UTILITY-TELEPHONE (CONTINUED)
Bell Atlantic Corporation 44,200 $ 2,956
Bellsouth Corporation 100,500 4,372
GTE Corporation 98,200 4,321
MCI Communications Corporation 68,600 1,792
NYNEX Corp. 43,200 2,333
Pacific Telesis Group 43,400 1,459
SBC Communications Incorporated 61,700 3,548
Sprint Corporation 35,300 1,408
U S West Inc. 47,600 1,702
*U S West Media Group 47,600 904
--------
Total 30,081
--------
Total Common Stock 464,866
--------
PREFERRED STOCK (0.0%)
DIVERSIFIED (0.0%)
Teledyne, Inc. 209 $ 3
--------
Total Preferred Stock 3
--------
MONEY MARKET INVESTMENTS (5.9%)
CHEMICALS (0.7%)
+E.I. du Pont de Nemours, 5.77%,
1/10/96 $3,500,000 $ 3,495
--------
FEDERAL GOVERNMENT & AGENCIES (0.4%)
+U.S. Treasury, 5.23%, 5/30/96 2,000,000 1,956
--------
FINANCIAL SERVICES (1.6%)
+IBM Credit Corporation, 5.71%,
1/4/96 7,900,000 7,896
--------
PRINTING & PUBLISHING (1.6%)
+Gannett Company Inc., 5.75%,
1/10/96 8,000,000 7,989
--------
TOBACCO (1.6%)
+Philip Morris Companies, Inc.,
5.58%, 1/17/96 8,000,000 7,980
--------
Total Money Market Investments 29,316
--------
Total Investments $494,185
========
</TABLE>
* Non-Income Producing
+ Held by the custodian in a segregated account as collateral for open financial
futures contracts. Information regarding open futures contracts as of December
31, 1995 is summarized below:
<TABLE>
<CAPTION>
UNREALIZED
APPRECIATION
NUMBER OF EXPIRATION (DEPRECIATION)
ISSUER CONTRACTS DATE (000'S)
-------------------- --------- ---------- --------------
<S> <C> <C> <C>
S&P 500 Stock Index 83 March 1996 $753
S&P 500 Stock Index 11 June 1996 (5)
------
Total $748
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
57
<PAGE> 61
NORTHWESTERN MUTUAL SERIES FUND, INC.
GROWTH STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- -------
<S> <C> <C>
COMMON STOCK (93.1%)
AEROSPACE (1.2%)
Boeing Company 13,000 $ 1,019
-------
AIRLINES (1.5%)
*AMR Corporation 3,600 267
Delta Air Lines, Inc. 5,000 369
*Midwest Express Holdings, Inc. 25,000 694
-------
Total 1,330
-------
AUTO & TRUCKS (1.0%)
Chrysler Corporation 16,100 891
-------
AUTO RELATED (1.2%)
Echlin Inc. 14,600 533
Magna International Inc. 12,200 528
-------
Total 1,061
-------
BANKS (4.5%)
Chase Manhattan Corporation 18,000 1,091
Citicorp 10,900 733
First Interstate Bancorp 5,500 751
First Union Corporation 16,100 896
Mellon Bank Corporation 7,300 392
-------
Total 3,863
-------
BEVERAGES (2.1%)
Coca-Cola Company 8,600 639
Pepsico Inc. 20,700 1,157
-------
Total 1,796
-------
CHEMICALS (2.4%)
Air Products & Chemicals, Inc. 13,700 723
E.I. du Pont de Nemours & Co. 10,150 709
PPG Industries Inc. 13,100 599
-------
Total 2,031
-------
CHEMICALS-SPECIALITY (2.4%)
Avery Dennison Corp. 15,000 752
Ecolab, Inc. 26,000 780
Nalco Chemical Company 17,000 512
-------
Total 2,044
-------
COAL, GAS AND PIPELINE (0.9%)
Sonat Inc. 21,000 748
-------
DIVERSIFIED (0.2%)
Minnesota Mining & Manufacturing
Company 2,500 166
-------
DRUGS (3.8%)
*Forest Laboratories Inc. 15,200 688
Eli Lilly & Company 11,600 653
Merck & Co., Inc. 17,000 1,118
Pfizer Inc. 12,600 794
-------
Total 3,253
-------
ELECTRICAL EQUIPMENT (3.6%)
Emerson Electric Co. 15,000 1,226
General Electric Company 14,100 1,015
W.W. Grainger, Inc. 12,600 835
-------
Total 3,076
-------
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- -------
<S> <C> <C>
ELECTRONICS (3.0%)
AVX Corporation 10,000 $ 265
*Applied Materials Inc. 19,300 760
Intel Corp. 12,000 681
Molex Inc. 29,408 901
-------
Total 2,607
-------
ENVIRONMENTAL CONTROL (0.8%)
Browning-Ferris Industries Inc. 24,200 714
-------
FINANCIAL SERVICES (2.6%)
Dean Witter, Discover & Co. 11,300 531
*Donaldson, Lufkin & Jenrette 30,000 937
Franklin Resources 14,800 746
-------
Total 2,214
-------
FOOD SERVICE/LODGING (3.1%)
*Harrah's Entertainment 29,000 703
McDonald's Corporation 21,500 970
*Promus Hotels 45,000 1,001
-------
Total 2,674
-------
FOODS (3.6%)
CPC International Corp. 14,600 1,002
Campbell Soup Company 15,500 930
General Mills, Inc. 16,800 970
Kellogg Company 3,000 232
-------
Total 3,134
-------
HOSPITAL SUPPLIES (5.2%)
Columbia/HCA Healthcare Corp. 22,400 1,137
Guidant Corp. 18,000 760
Johnson & Johnson 15,100 1,293
Manor Care, Inc. 3,800 133
United Healthcare Corp. 18,000 1,179
-------
Total 4,502
-------
HOUSEWARES (1.2%)
Newell Co. 41,500 1,074
-------
INSURANCE (4.4%)
Aetna Life & Casualty Company 12,300 852
CIGNA Corporation 9,000 929
PMI Group Inc. 15,000 679
Prudential Reinsurance, Inc. 57,000 1,332
-------
Total 3,792
-------
LEISURE RELATED (2.3%)
Walt Disney Company 16,700 985
Mattel, Inc. 31,425 966
-------
Total 1,951
-------
MACHINERY (1.0%)
Deere & Company 4,600 162
Ingersoll-Rand Company 20,000 702
-------
Total 864
-------
OFFICE EQUIPMENT (3.7%)
*BT Office Products International 45,000 720
Hewlett-Packard Company 14,000 1,172
International Business Machines
Corp. 14,500 1,330
-------
Total 3,222
-------
</TABLE>
58
<PAGE> 62
NORTHWESTERN MUTUAL SERIES FUND, INC.
GROWTH STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- -------
<S> <C> <C>
COMMON STOCK (CONTINUED)
OFFICE EQUIPMENT-SERVICES (4.9%)
Alco Standard Corporation 25,200 $ 1,150
Automatic Data Processing, Inc. 2,400 178
DST Systems, Inc. 40,000 1,140
General Motors, Class E 23,100 1,201
*Microsoft Corporation 5,800 509
-------
Total 4,178
-------
OIL & GAS-DOMESTIC (1.5%)
Ashland, Inc. 9,100 320
Tosco Corp. 5,000 191
Unocal Corp. 27,700 807
-------
Total 1,318
-------
OIL & GAS-INTERNATIONAL (4.6%)
Amoco Company 12,100 870
British Petroleum Co. Ltd. 6,800 694
Exxon Corporation 10,900 873
Mobil Corporation 9,800 1,098
Texaco Inc. 5,400 424
-------
Total 3,959
-------
PAPER (0.6%)
International Paper Company 14,000 530
-------
PRINTING & PUBLISHING (1.5%)
McGraw-Hill Companies 8,100 706
Tribune Company 9,500 581
-------
Total 1,287
-------
RAILROADS (3.9%)
Burlington Northern Santa Fe 11,300 881
+Canadian National Railway Co. 75,000 1,687
*Southern Pacific Transportation
Co. 32,000 768
-------
Total 3,336
-------
RETAIL-FOOD (0.9%)
Albertson's, Inc. 23,100 759
-------
RETAIL-GENERAL (6.3%)
Dayton Hudson Corporation 5,600 420
*Federated Department Stores 24,200 665
Home Depot, Inc. 27,200 1,302
*OfficeMax, Inc. 51,200 1,146
J.C. Penney Company, Inc. 13,100 624
Wal-Mart Stores, Inc. 20,200 452
Walgreen Company 26,600 795
-------
Total 5,404
-------
<CAPTION>
MARKET
SHARES/ VALUE
PAR (000'S)
---------- -------
<S> <C> <C>
SOAPS & TOILETRIES (2.5%)
Colgate-Palmolive Co. 9,000 $ 632
Gillette Company 14,000 730
The Procter & Gamble Company 9,700 805
-------
Total 2,167
-------
TELECOMMUNICATIONS (5.2%)
AT&T Corporation 19,800 1,282
*DSC Communications Corp. 12,500 461
Frontier Corp. 35,600 1,068
Motorola, Inc. 13,000 741
*WorldCom, Inc. 25,000 881
-------
Total 4,433
-------
TOBACCO (0.8%)
Philip Morris Companies, Inc. 8,000 724
-------
UTILITY-ELECTRIC (2.2%)
Duke Power Company 19,700 933
FPL Group, Inc. 11,800 547
Southern Company 17,900 441
-------
Total 1,921
-------
UTILITY-TELEPHONE (2.5%)
Ameritech Corporation 12,400 732
GTE Corporation 19,600 862
U S West Inc. 9,500 340
*U S West Media Group 9,500 181
-------
Total 2,115
-------
Total Common Stock 80,157
-------
MONEY MARKET INVESTMENTS (6.9%)
FINANCIAL SERVICES (1.2%)
IBM Credit Corporation, 5.73%,
1/4/96 $1,000,000 $ 999
-------
FOODS (1.9%)
Cargill Incorporated, 5.75%, 1/2/96 1,600,000 1,600
-------
PRINTING & PUBLISHING (1.9%)
Gannett Company Inc., 5.75%,
1/10/96 1,600,000 1,598
-------
TOBACCO (1.9%)
++Philip Morris Companies, Inc.
5.58%, 1/17/96 1,600,000 1,596
-------
Total Money Market Investments 5,793
-------
Total Investments $85,950
=======
</TABLE>
* Non-Income Producing
+ Installment payment security purchased November 16, 1995, for which the
Portfolio has paid $900,000 as of December 31, 1995. The Portfolio will make
the final installment payment of approximately $600,000 on November 29, 1996.
++ $600,000 is segregated as collateral for future payment of the installment
payment security.
The Accompanying Notes are an Integral Part of the Financial Statements
59
<PAGE> 63
NORTHWESTERN MUTUAL SERIES FUND, INC.
GROWTH AND INCOME STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
COMMON STOCK (95.8%)
AEROSPACE (1.6%)
Boeing Company 10,500 $ 823
Sundstrand Corp. 20,200 1,422
--------
Total 2,245
--------
AUTO & TRUCKS (2.1%)
General Motors Corporation 53,100 2,808
--------
AUTO RELATED (0.9%)
Cooper Tire & Rubber Company 47,500 1,170
--------
BANKS (6.9%)
BankAmerica Corporation 40,600 2,629
First Union Corporation 32,200 1,791
Firstar Corporation 44,300 1,755
NationsBank Corp. 36,300 2,527
Standard Federal Bancorp 17,800 701
--------
Total 9,403
--------
BEVERAGES (2.9%)
Anheuser-Busch Companies Inc. 9,600 642
Pepsico Inc. 58,100 3,246
--------
Total 3,888
--------
BROADCASTING (0.5%)
Turner Broadcasting System 25,500 663
--------
BUILDING & CONSTRUCTION (0.6%)
*USG Corporation 29,400 882
--------
CHEMICALS (3.2%)
Albemarle Corporation 73,900 1,432
E.I. du Pont de Nemours & Co. 19,100 1,335
Freeport McMoRan Copper & Gold Inc. 1,029 26
Union Carbide Corporation 42,400 1,590
--------
Total 4,383
--------
CHEMICALS-SPECIALITY (0.7%)
Wellman Inc. 43,300 985
--------
COAL, GAS AND PIPELINE (0.8%)
Anadarko Petroleum Corp. 21,000 1,137
--------
DIVERSIFIED (2.8%)
Allied Signal Inc. 62,200 2,954
*Coltec Industries Inc. 70,500 819
--------
Total 3,773
--------
DRUGS (3.8%)
*Forest Laboratories Inc. 30,900 1,398
Eli Lilly & Company 43,800 2,374
Warner-Lambert Company 13,200 1,282
--------
Total 5,054
--------
ELECTRICAL EQUIPMENT (3.6%)
General Electric Company 36,500 2,628
W.W. Grainger, Inc. 33,800 2,239
--------
Total 4,867
--------
ELECTRONICS (1.9%)
General Instrument Corp. 57,300 1,339
Hewlett-Packard Company 15,500 1,298
--------
Total 2,637
--------
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
ENVIRONMENTAL CONTROL (0.9%)
Wheelabrator Technologies Inc. 70,700 $ 1,184
--------
FINANCIAL SERVICES (1.4%)
Dean Witter, Discover & Co. 26,500 1,246
Great Western Financial Corp. 25,800 658
--------
Total 1,904
--------
FOODS (0.8%)
General Mills, Inc. 17,900 1,034
--------
HOSPITAL SUPPLIES (6.4%)
Bausch & Lomb Inc. 60,500 2,397
Columbia/HCA Healthcare Corp. 40,700 2,066
Healthcare Retirement Corp. 42,900 1,502
Humana, Inc. 99,800 2,732
--------
Total 8,697
--------
INSURANCE (2.9%)
AMBAC, Inc. 24,400 1,144
First Colony Corporation 34,100 865
Providian Corporation 46,800 1,907
--------
Total 3,916
--------
LEISURE RELATED (2.2%)
*Circus Circus Enterprises 68,500 1,909
International Game Technology 100,900 1,097
--------
Total 3,006
--------
MACHINERY (1.4%)
*Cooper Cameron Corp. 16,760 595
Cooper Industries, Inc. 35,462 1,303
--------
Total 1,898
--------
MEDIA (1.9%)
*Tele-Communications, Inc. 129,200 2,568
--------
METALS & MINING (1.8%)
Aluminum Co. of America 47,200 2,496
--------
OFFICE EQUIPMENT (1.5%)
Quantum Corp. 73,300 1,182
*Read-Rite Corporation 39,800 925
--------
Total 2,107
--------
OFFICE EQUIPMENT-SERVICES (2.0%)
Adobe Systems Incorporated 10,000 620
Autodesk, Inc. 36,200 1,240
*Novell, Inc. 58,700 836
--------
Total 2,696
--------
OIL & GAS-DOMESTIC (2.8%)
Ashland, Inc. 57,000 2,002
Sun Company, Inc. 32,000 876
Unocal Corp. 32,600 949
--------
Total 3,827
--------
OIL & GAS-INTERNATIONAL (5.2%)
British Petroleum Co. Ltd. 8,600 878
Chevron Corp. 28,000 1,470
Royal Dutch Petroleum Co., ADR 21,900 3,091
Texaco Inc. 21,900 1,719
--------
Total 7,158
--------
</TABLE>
60
<PAGE> 64
NORTHWESTERN MUTUAL SERIES FUND, INC.
GROWTH AND INCOME STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
COMMON STOCK (CONTINUED)
PAPER (0.9%)
Mead Corp. 22,600 $ 1,181
--------
PRINTING & PUBLISHING (0.5%)
Time Warner Inc. 17,800 674
--------
PROFESSIONAL SERVICES (2.5%)
Service Corporation International 76,400 3,362
--------
RAILROADS (2.1%)
Union Pacific Corporation 44,500 2,937
--------
RETAIL-GENERAL (4.8%)
Melville Corporation 24,200 744
Nordstrom, Inc. 25,400 1,029
J.C. Penney Company, Inc. 36,400 1,733
*Symbol Technologies Inc. 20,500 810
TJX Companies, Inc. 11,000 208
Wal-Mart Stores, Inc. 90,100 2,016
--------
Total 6,540
--------
SAVINGS & LOAN (0.9%)
H.F. Ahmanson & Company 44,700 1,184
--------
SOAPS & TOILETRIES (3.9%)
Avon Products, Inc. 12,700 957
Colgate-Palmolive Co. 28,000 1,967
The Procter & Gamble Company 28,300 2,349
--------
Total 5,273
--------
TELECOMMUNICATIONS (4.7%)
AT&T Corporation 44,000 2,849
*Bay Networks 45,100 1,855
Motorola, Inc. 30,600 1,744
--------
Total 6,448
--------
TOBACCO (2.9%)
Philip Morris Companies, Inc. 44,000 3,982
--------
TRUCKING-SHIPPING (1.1%)
Consolidated Freightways, Inc. 57,000 1,510
--------
<CAPTION>
MARKET
SHARES/ VALUE
PAR (000'S)
---------- --------
<S> <C> <C>
UTILITY-ELECTRIC (3.7%)
Dominion Resources Inc. 24,800 $ 1,023
Entergy Corporation 44,400 1,299
Public Service Co. of Colorado 34,900 1,235
Western Resources 46,200 1,542
--------
Total 5,099
--------
UTILITY-TELEPHONE (4.3%)
Bellsouth Corporation 48,300 2,101
MCI Communications Corporation 37,800 988
U S West Inc. 61,900 2,213
*U S West Media Group 33,200 631
--------
Total 5,933
--------
Total Common Stock 130,509
--------
MONEY MARKET INVESTMENTS (4.2%)
CHEMICALS (0.7%)
E.I. du Pont de Nemours & Co.,
5.83%, 1/5/96 $1,000,000 $ 999
--------
FINANCIAL SERVICES (0.9%)
General Electric Capital Corp.,
5.76%, 1/17/96 600,000 599
IBM Credit Corporation, 5.73%,
1/4/96 600,000 600
--------
Total 1,199
--------
PRINTING & PUBLISHING (0.4%)
Gannett Company Inc., 5.75%,
1/10/96 600,000 599
--------
TOBACCO (2.2%)
Philip Morris Companies, Inc.,
5.78%, 1/5/96 3,000,000 2,998
--------
Total Money Market
Investments 5,795
--------
Total Investments $136,304
========
</TABLE>
* Non-Income Producing
The Accompanying Notes are an Integral Part of the Financial Statements
61
<PAGE> 65
NORTHWESTERN MUTUAL SERIES FUND, INC.
AGGRESSIVE GROWTH STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
COMMON STOCK (93.7%)
AIRLINES (1.4%)
*ValuJet, Inc. 285,000 $ 7,054
*Western Pacific Airlines, Inc. 72,500 1,214
--------
Total 8,268
--------
AUTO RELATED (1.8%)
*Custom Chrome Inc. 180,800 4,181
*O'Reilly Automotive, Inc. 102,800 2,981
*Thompson PBE, Inc. 214,000 2,996
--------
Total 10,158
--------
BANKS (0.9%)
*Leader Financial Corp. 138,900 5,191
--------
BEVERAGES (0.9%)
*Robert Mondavi Corporation 185,900 5,135
--------
CHEMICALS (0.7%)
A. Schulman Inc. 174,950 3,936
--------
CHEMICALS-SPECIALITY (0.7%)
Cambrex Corporation 98,300 4,067
--------
CONSUMER PRODUCTS (1.7%)
*Blythe Industries, Inc. 342,200 10,095
--------
DRUGS (1.4%)
Cardinal Health Inc. 150,312 8,230
--------
ELECTRICAL EQUIPMENT (1.3%)
*Catalina Marketing Corporation 68,300 4,286
*CIDCO Incorporated 132,200 3,371
--------
Total 7,657
--------
ELECTRONICS (5.2%)
AVX Corporation 125,000 3,312
*Altera Corporation 78,600 3,910
*Applied Materials Inc. 96,200 3,788
*Electroglas, Inc. 137,000 3,356
*In Focus Systems Inc. 127,600 4,610
Methode Electronics Inc. 385,500 5,493
Molex Inc. 176,389 5,402
--------
Total 29,871
--------
ENVIRONMENTAL CONTROL (1.3%)
*TETRA Technologies, Inc. 336,250 7,650
--------
FINANCIAL SERVICES (2.9%)
Investors Financial Services 115,900 2,405
Money Store, Inc. 300,750 4,699
PMT Services, Inc. 180,300 5,454
WFS Financial Corporation 230,300 4,491
--------
Total 17,049
--------
FOOD SERVICE/LODGING (2.4%)
*Hospitality Franchise Systems,
Inc. 167,500 13,693
--------
HOSPITAL SUPPLIES (18.2%)
*Access Health, Inc. 47,000 2,080
*American Medical Response Inc. 202,800 6,591
*Apria Healthcare Group, Inc. 100,000 2,825
Columbia/HCA Healthcare Corp. 118,200 5,999
Compdent Corporation 161,800 6,715
*Gulf South Medical Supply, Inc. 290,000 8,772
*Heart Technology 228,500 7,512
*Inbrand Corporation 344,050 5,677
*Medaphis Corporation 167,400 6,194
*MediSense Inc. 252,000 7,969
*Patterson Dental Company 226,250 6,109
*PhyCor, Inc. 59,100 2,988
*Physician Sales & Service, Inc. 100,000 2,850
*Quorum Health Group, Inc. 216,300 4,759
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
HOSPITAL SUPPLIES (CONTINUED)
*Respironics Inc. 265,800 $ 5,582
*Sybron, Inc. 264,200 6,275
*United Dental Care, Inc. 104,100 4,294
United Healthcare Corp. 61,700 4,041
*Ventritex, Inc. 113,000 1,963
*Vivra Incorporated 243,300 6,113
--------
Total 105,308
--------
HOUSEHOLD FURNITURE (1.3%)
*Department 56, Inc. 189,200 7,261
--------
INSURANCE (1.4%)
Amerin Corp. 52,000 1,391
PMI Group Inc. 147,600 6,679
--------
Total 8,070
--------
LEISURE RELATED (2.8%)
*Broderbund Software Inc. 56,100 3,408
The Marcus Corporation 124,050 3,396
*Scientific Games Holding Corp. 213,900 8,075
*Studio Plus Hotels Inc. 40,500 1,043
--------
Total 15,922
--------
OFFICE EQUIPMENT (6.0%)
*Nu-Kote Holdings Inc. -- "A"
Series 377,200 6,412
*Peak Technologies 209,300 6,541
*Tivoli Systems Inc. 166,700 5,626
*Viking Office Products Inc. 175,200 8,147
*Zebra Technologies 239,200 8,133
--------
Total 34,859
--------
OFFICE EQUIPMENT-SERVICES (13.2%)
American Management System Inc. 255,650 7,669
*Corporate Express, Inc. 203,400 6,127
Danka Business Systems 194,900 7,211
First Data Corporation 147,095 9,837
HBO & Co. 75,000 5,747
*Hyperion Software 290,600 6,175
Medic Computer Systems, Inc. 86,200 5,215
*Metatools, Inc. 42,000 1,092
Paychex Incorporated 131,330 6,550
*Peoplesoft, Inc. 157,400 6,768
SPS Transactional Services, Inc. 136,700 4,050
*TESSCO Technologies Incorporated 190,700 5,435
*Transaction Systems Architects 132,000 4,455
--------
Total 76,331
--------
OIL & GAS PROGRAMS (0.8%)
Parker And Parsley Petroleum Co. 199,400 4,387
--------
OIL FIELD SERVICES (1.7%)
Production Operators Corp. 144,300 4,762
Tosco Corp. 130,000 4,956
--------
Total 9,718
--------
PAPER (0.9%)
Wausau Paper Mills Company 193,055 5,261
--------
PROFESSIONAL SERVICES (4.2%)
*CUC International Inc. 229,350 7,827
Cintas Corporation 150,300 6,688
*Interim Service 92,000 3,197
*Robert Half International Inc. 156,600 6,558
--------
Total 24,270
--------
RAILROADS (1.2%)
*Wisconsin Central Transportation 102,400 6,733
--------
</TABLE>
62
<PAGE> 66
NORTHWESTERN MUTUAL SERIES FUND, INC.
AGGRESSIVE GROWTH STOCK PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
---------- --------
<S> <C> <C>
COMMON STOCK (CONTINUED)
RETAIL-APPAREL (0.6%)
The Talbots, Inc. 113,600 $ 3,266
--------
RETAIL-GENERAL (7.7%)
*DST Systems, Inc. 93,800 2,673
*Eastbay, Inc. 128,000 2,528
Fastenal Co. 152,400 6,439
Global Direct Mail Corp. 200,000 5,500
*Kohl's Department Stores 75,000 3,937
*Micro Warehouse Inc. 105,400 4,559
*Oakley, Inc. 152,200 5,175
*OfficeMax, Inc. 316,200 7,075
Tractor Supply Company 221,200 4,369
*Trend-Lines, Inc. 231,000 2,310
--------
Total 44,565
--------
SOFTWARE (0.9%)
Sterling Software, Inc. 85,000 5,302
--------
TELECOMMUNICATIONS (6.6%)
*ADC Telecommunication 118,300 4,318
*APAC TeleServices, Inc. 118,400 3,952
*AirTouch Communications 182,600 5,158
*CellStar Corp. 73,200 1,903
*Firefox Communications, Inc. 110,000 2,585
*LCI International 291,200 5,970
LIN Television Corp. 121,500 3,615
*Saville Systems PLC-ADR 200,000 2,850
*Tellabs Inc. 155,400 5,750
*Uunet Technologies, Inc. 37,000 2,331
--------
Total 38,432
--------
<CAPTION>
MARKET
SHARES/ VALUE
PAR (000'S)
---------- --------
<S> <C> <C>
TRANSPORTATION (0.1%)
Cronos Group 40,000 $ 470
--------
TRUCKING-SHIPPING (3.5%)
*Eagle USA Airfreight, Inc. 20,000 525
*Fritz Companies, Inc. 286,200 11,877
*Heartland Express Incorporated 237,827 4,697
*Landstar System, Inc. 125,000 3,344
--------
Total 20,443
--------
Total Common Stock 541,598
--------
MONEY MARKET INVESTMENTS (6.3%)
CHEMICALS (1.3%)
E.I. du Pont de Nemours & Co.,
5.83%, 1/5/96 $7,500,000 $ 7,495
--------
FINANCIAL SERVICES (1.4%)
IBM Credit Corporation,
5.73%, 1/4/96 8,000,000 7,996
--------
FOODS (0.8%)
Cargill Incorporated,
5.75%, 1/2/96 5,000,000 4,999
--------
PRINTING & PUBLISHING (1.4%)
Gannett Company Inc.,
5.75%, 1/10/96 8,000,000 7,989
--------
TOBACCO (1.4%)
Philip Morris Companies, Inc.,
5.58%, 1/17/96 8,000,000 7,980
--------
Total Money Market Investments 36,459
--------
Total Investments $578,057
========
</TABLE>
* Non-Income Producing
The Accompanying Notes are an Integral Part of the Financial Statements
63
<PAGE> 67
NORTHWESTERN MUTUAL SERIES FUND, INC.
INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
COUNTRY SHARES (000'S)
------- ----------- --------
<S> <C> <C> <C>
COMMON STOCKS (87.5%)
AIRLINES (1.3%)
Singapore Airlines Ltd. Sing. 205,000 $ 1,913
Qantas Airways (144A) Austrl. 155,000 2,581
--------
Total 4,494
--------
APPLIANCES & HOUSEHOLD DURABLES (1.5%)
Sony Corporation Jpn. 83,000 4,976
--------
AUTOMOBILES (2.5%)
Renault SA Fr. 117,500 3,387
Volvo Aktieboleget, B Free Swe. 240,000 4,914
--------
Total 8,301
--------
BANKING & CREDIT (15.6%)
Argentina Corp. Bancaris de
Espana, ADR Sp. 195,000 3,924
Australia & New Zealand Bank
Group Austrl. 926,097 4,343
Banco de Andulucia Sp. 30,000 4,370
Banque National de Paris,
ADR (144A) Fr. 117,000 5,284
Barclay's Bank, PLC U.K. 311,016 3,566
Banco Bilboa Vizcaya Sp. 162,500 5,844
Banco Portugues de
Investimentos Port. 71,350 853
Canadian Imperial Bank of
Commerce Can. 177,000 5,266
Deutsche Bank Ger. 88,000 4,171
HSBC Holdings H.K. 278,237 4,210
National Bank of Canada
Montreal Can. 360,000 2,933
Panin Bank Indo. 580,000 520
Stadshypotek AB "A" Swe. 120,000 2,403
Svenska Handelsbanken S A Swe. 252,000 5,236
--------
Total 52,923
--------
BUILDING MATERIALS AND COMPONENTS (1.2%)
Pioneer International Ltd. Austrl. 1,600,000 4,127
--------
BUSINESS & PUBLIC SERVICE (4.5%)
Esselte AB, Series A Swe. 269,900 4,063
SGS Holdings Swtz. 2,770 5,497
Welsh Water PLC U.K. 371,666 4,472
*Waste Management PLC U.K. 98,000 1,053
--------
Total 15,085
--------
CHEMICALS (4.4%)
Bayer AG Ger. 18,000 4,751
European Vinyls Corp. EVC
International Neth. 36,525 949
Rhone Poulenc S.A., Series A Fr. 243,000 5,212
Solvay Et Cie A NPV Bel. 7,300 3,956
--------
Total 14,868
--------
CONSTRUCTION AND HOUSING (1.2%)
Daito Trust Construction Co. Jpn. 195,000 2,304
Kyudenko Corp. Jpn. 122,000 1,607
--------
Total 3,911
--------
ELECTRICAL & ELECTRONICS (5.2%)
BBC Brown, Boveri & Co.,
Series A Swtz. 4,730 5,492
<CAPTION>
MARKET
VALUE
COUNTRY SHARES (000'S)
------- ----------- --------
<S> <C> <C> <C>
ELECTRICAL & ELECTRONICS (CONTINUED)
Hitachi Ltd. Jpn. 450,000 $ 4,533
Alcatel Alsthom DG Fr. 49,000 4,230
BICC U.K. 815,000 3,482
--------
Total 17,737
--------
ENERGY SOURCES (3.7%)
Repsol SA Sp. 122,000 3,991
Saga Petroleum, Series "A" Nor. 260,000 3,471
Societe Nationale Elf
Aquitaine Fr. 70,301 5,186
--------
Total 12,648
--------
FINANCIAL SERVICES (3.8%)
AXA SA Fr. 27,000 1,822
*Capital Portugal Fund Port. 16,000 1,411
Chile Fund U.S. 35,000 910
India Fund, Series "B" U.K. 1,256,515 2,118
*JF Indonesia Fund Inc. H.K. 456,600 502
Korea International Trust Kor. 52 2,964
Thai Fund Inc. Thai 50,500 1,130
Thailand International Fund Thai 70 2,082
--------
Total 12,939
--------
FOOD & HOUSEHOLD PRODUCTS (3.1%)
Albert Fisher Group U.K. 4,884,524 3,566
Cafe de Coral Holdings, Ltd. H.K. 7,072,000 1,610
Hillsdown Holdings U.K. 1,531,627 4,045
Vitro SA NPV Mex. 768,400 1,195
--------
Total 10,416
--------
FOREST PRODUCTS & PAPER (3.2%)
Barito Pacific Timber Indo. 937,000 686
Carter Holt Harvey Ltd. N.Z. 1,995,957 4,306
Metsa-Serla OY "B" Fin. 55,500 1,710
Stora Kopparbergs, Series B
Free Swed. 350,000 4,189
--------
Total 10,891
--------
HEALTH & PERSONAL CARE (3.0%)
Astra AB, Series A Free Swed. 140,000 5,585
Hafslund Nycomed "A" Norw. 170,000 4,432
--------
Total 10,017
--------
INSURANCE (4.8%)
Aegon NV Neth. 117,837 5,212
International Nederlanden
Group Neth. 76,000 5,076
London Insurance Group Can. 162,600 3,289
*Zurich Versicherung Namen Swtz. 8,400 2,511
--------
Total 16,088
--------
MACHINERY & ENGINEERING (1.3%)
VA Technologies AG Bearer
(144A) Aus. 30,000 3,806
Hitachi Koki Co. Ltd. Jpn. 75,000 680
--------
Total 4,486
--------
MERCHANDISING (1.4%)
Koninklijke Bijenkorf Beheer Neth. 42,874 2,831
Kwik Save Group U.K. 226,100 1,756
--------
Total 4,587
--------
</TABLE>
64
<PAGE> 68
NORTHWESTERN MUTUAL SERIES FUND, INC.
INTERNATIONAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
COUNTRY SHARES (000'S)
------- ----------- --------
<S> <C> <C> <C>
COMMON STOCKS (CONTINUED)
METALS & MINING (2.2%)
Elkem A S Oslo ord A Free Nor. 192,000 $ 2,184
*Inmet Mining Ltd. Can. 192,500 1,410
Pechiney Cert. D'Invest Fr. 11,250 426
*Union Miniere, NPV Bel. 50,500 3,366
--------
Total 7,386
--------
MULTI-INDUSTRY (5.5%)
Amer Group "A" Fin. 175,000 2,732
BTR Nylex Ltd. Austrl. 324,000 1,582
Hutchinson Whampoa H.K. 798,000 4,850
Jardine Matheson Holdings H.K. 387,074 2,651
Jardine Strategic Holdings H.K. 971,830 2,974
Swire Pacific Class "A" H.K. 472,500 3,666
--------
Total 18,455
--------
RAILROAD (0.8%)
Brambles Ind. Ltd. Austrl. 240,000 2,676
--------
TELECOMMUNICATIONS (6.9%)
CIA De Telefonos Chile SA Chile 36,500 3,025
Nacional Financiera CNV Mex. 101,300 3,356
Phillipine Long Distance
Telephone Phil. 61,000 3,302
*SPT Telecom AS Chez. 12,500 1,181
Stet Di Risp Non-Conv. Italy 2,320,000 4,734
Telebras ADR Braz. 77,500 3,672
Telefonica de Espana Sp. 304,000 4,203
--------
Total 23,473
--------
UTILITIES-ELECTRIC & GAS (9.1%)
British Gas U.K. 1,025,000 4,045
*CEZ Ceske Energeticke
Zavody Chez. 79,690 2,881
Electricidad De Caracas Venz. 3,154,003 2,155
Endesa National De Electric Sp. 63,000 3,562
Evn Energieversorgung Aus. 32,000 4,392
Hong Kong Electric H.K. 990,000 3,252
Iberdrola SA Sp. 587,500 5,367
South Wales Electricity U.K. 204,600 2,965
*Veba AG Warrants, Exp.
4/6/98 Ger. 12,000 1,891
--------
Total 30,510
--------
<CAPTION>
MARKET
SHARES/ VALUE
COUNTRY PAR (000'S)
------- ----------- --------
<S> <C> <C> <C>
WHOLESALE & INTERNATIONAL TRADE (1.3%)
Brierley Investments Ltd. N.Z. 5,716,091 $ 4,522
--------
Total Common Stock 295,516
--------
PREFERRED STOCK (0.2%)
BUSINESS & PUBLIC SERVICE (0.2%)
*Welsh Water PLC U.K. 401,400 $ 678
--------
MULTI-INDUSTRY (0.0%)
Jardine Strategic Holding
IDR H.K. 134,000 144
--------
Total Preferred Stock 822
--------
BONDS (2.6%)
BANKING AND CREDIT (0.9%)
CS Holding, 4 7/8%,11/19/02 U.K. $ 1,995,000 $ 3,132
--------
FINANCIAL SERVICES (0.7%)
PIV Financial Inv. Cayman,
4 1/2%, 12/1/00 H.K. 2,750,000 2,282
--------
TELECOMMUNICATIONS (1.0%)
Comp de Inever Telecom, 7%,
3/3/98 Arg. 57,700 3,217
--------
Total Bonds 8,631
--------
MONEY MARKET INVESTMENTS (9.7%)
FINANCIAL SERVICES (4.4%)
American Express, 5.65%,
1/2/96 U.S. $15,000,000 $ 15,000
--------
FEDERAL GOVERNMENT & AGENCIES (0.8%)
U.S. Treasury Notes, 8.875%,
2/15/96 U.S. 2,850,000 2,862
--------
INSURANCE (4.5%)
Prudential, 5.65%, 1/2/96 U.S. 15,350,000 15,350
--------
Total Money Market
Investments 33,212
--------
Total Investments $338,181
========
</TABLE>
* Non-Income Producing
The Accompanying Notes are an Integral part of the Financial Statements
65
<PAGE> 69
NORTHWESTERN MUTUAL SERIES FUND, INC.
SELECT BOND PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
PAR (000'S)
---------- --------
<S> <C> <C>
BONDS (83.6%)
AIRLINES (1.3%)
Delta Air Lines, Inc., 9 3/4%,
5/26/03 $ 546,000 $ 638
Delta Air Lines, Inc., 9 3/4%,
6/1/03 1,605,000 1,877
--------
Total 2,515
--------
AUTO RELATED (1.3%)
General Motors Corporation,
8 4/5%, 3/1/21 1,250,000 1,567
Hertz Corp., 9.04%, 6/14/00 900,000 1,006
--------
Total 2,573
--------
BANKS (1.0%)
Natwest Capital Corporation,
12 1/8%, 11/15/02 1,700,000 1,886
--------
BEVERAGES (2.9%)
Coca-Cola Enterprises, Inc.,
8%, 1/4/05 5,000,000 5,699
--------
CMO & LOAN-BACKED CERTIFICATES (15.8%)
CIT RV Owner Trust, 6 1/4%,
1/15/11 2,188,935 2,214
Federal Home Loan Mortgage Corp.,
7 1/4%, 4/15/18 2,425,000 2,453
Federal Home Loan Mortgage Corp.,
7%, 3/15/07 1,875,000 1,921
Federal Home Loan Mortgage Corp.,
6%, 7/15/07 3,900,000 3,908
Federal Home Loan Mortgage Corp.,
6 1/4%, 7/25/07 3,850,000 3,908
Federal Home Loan Mortgage Corp.,
6 3/4%, 12/25/23 3,500,000 3,452
Ford Motor Credit Grantor Trust,
5.9%, 10/15/00 2,918,090 2,934
Premier Auto Trust, 6.65%, 4/2/98 3,300,000 3,343
Rural Housing Trust, 6.33%, 4/1/26 2,660,522 2,636
Security Capital Industrial Trust,
7.3%, 5/15/01 2,000,000 2,017
World Omni Grantor Trust,
7.95%, 1/25/01 2,000,000 2,042
--------
Total 30,828
--------
CHEMICALS (1.1%)
Dow Capital B.V., 8 1/2%, 6/8/10 1,800,000 2,152
--------
FEDERAL GOVERNMENT AND AGENCIES (27.2%)
Federal Home Loan Mortgage Corp.,
7%, 6/1/25 6,231,741 6,288
Government National Mortgage
Assoc.,
8 1/2%, 3/15/23 12,276 13
Government National Mortgage
Assoc.,
7%, 5/15/23 513,979 521
Government National Mortgage
Assoc.,
7 1/2%, 2/15/24 1,934,796 1,990
Government National Mortgage
Assoc.,
7%, 5/15/23 3,175,829 3,218
Government National Mortgage
Assoc.,
8 1/2%, 9/15/24 514,312 540
Government National Mortgage
Assoc.,
8 1/2%, 6/15/23 374,415 393
Government National Mortgage
Assoc.,
8 1/2%, 7/15/24 124,011 130
<CAPTION>
MARKET
VALUE
PAR (000'S)
---------- --------
<S> <C> <C>
FEDERAL GOVERNMENT AND AGENCIES (CONTINUED)
Government National Mortgage
Assoc.,
8 1/2%, 2/15/25 $ 201,464 $ 212
Government National Mortgage
Assoc.,
7 1/2%, 1/15/24 912,938 939
Government National Mortgage
Assoc.,
7 1/2%, 1/15/24 936,665 963
Government National Mortgage
Assoc.,
8 1/2%, 11/15/24 326,485 343
Government National Mortgage
Assoc.,
8 1/2%, 11/15/24 342,126 359
Government National Mortgage
Assoc.,
8 1/2%, 8/15/24 409,502 430
Government National Mortgage
Assoc.,
8 1/2%, 8/15/24 327,513 344
Government National Mortgage
Assoc.,
7 1/2%, 6/15/24 1,717,829 1,767
Government National Mortgage
Assoc.,
8 1/2%, 2/15/25 154,084 162
Government National Mortgage
Assoc.,
8 1/2%, 9/15/24 387,325 407
Government National Mortgage
Assoc.,
8 1/2%, 11/15/24 351,439 369
Government National Mortgage
Assoc.,
8 1/2%, 4/15/21 306,455 322
Government National Mortgage
Assoc.,
8 1/2%, 9/15/21 225,579 237
Government National Mortgage
Assoc.,
8 1/2%, 3/15/22 320,087 336
Government National Mortgage
Assoc.,
7%, 6/15/23 2,913,178 2,952
U.S. Treasury, 7 1/8%, 2/15/23 8,200,000 9,366
U.S. Treasury, 7 1/2%, 11/15/24 1,500,000 1,802
U.S. Treasury, 7 5/8%, 2/15/25 10,000,000 12,219
U.S. Treasury, 6 7/8%, 8/15/25 1,000,000 1,128
U.S. Treasury, 7 1/8%, 9/30/99 5,000,000 5,298
--------
Total 53,048
--------
FINANCE COMPANIES (4.3%)
Associates Corp. of North America,
6 7/8%, 1/15/97 2,200,000 2,231
Associates Corp. of North America,
7.95%, 2/15/10 1,500,000 1,737
Avco Financial Services, Inc.,
5 7/8%, 10/15/97 2,200,000 2,214
Beneficial Corp., 6.86%, 11/19/97 2,200,000 2,250
--------
Total 8,432
--------
FOODS (0.8%)
Nabisco Inc., 8%, 1/15/00 1,500,000 1,595
--------
FOREIGN GOVERNMENT BONDS (2.5%)
Province of Manitoba, 7 3/4%,
7/17/16 2,000,000 2,252
Province of Quebec, 7 1/8%, 2/9/24 2,500,000 2,520
--------
Total 4,772
--------
MEDIA (6.2%)
News America Holdings Inc.,
7 1/2%, 3/1/00 3,500,000 3,672
News America Holdings Inc.,
8 1/4%, 8/10/18 1,000,000 1,091
</TABLE>
66
<PAGE> 70
NORTHWESTERN MUTUAL SERIES FUND, INC.
SELECT BOND PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
PAR (000'S)
---------- --------
<S> <C> <C>
BONDS (CONTINUED)
MEDIA (CONTINUED)
Tele-Communications, Inc.,
7 3/8%, 2/15/00 $2,000,000 $ 2,077
Tele-Communications, Inc.,
7 7/8%, 8/1/13 2,000,000 2,067
Time Warner Entertainment Inc.,
8 7/8%, 10/1/12 2,000,000 2,237
Time Warner Inc., 7 3/4%, 6/15/05 1,000,000 1,043
--------
Total 12,187
--------
OFFICE EQUIPMENT (1.6%)
International Business Machines
Corp., 6 3/8%, 11/1/97 3,000,000 3,049
--------
TOBACCO (2.6%)
Philip Morris Companies, Inc.,
9%, 5/15/98 1,750,000 1,873
Philip Morris Companies, Inc.,
9 1/4%, 2/15/00 1,000,000 1,118
RJR Nabisco, Inc., 8 5/8%, 12/1/02 2,000,000 2,075
--------
Total 5,066
--------
UTILITY-ELECTRIC (15.0%)
Cleveland Electric Illuminating
Co.,
7 3/8%, 6/1/03 1,000,000 945
DTE Energy Company,
5.41%, 5/1/97 4,000,000 3,988
Long Island Lighting Co.,
9 5/8%, 7/1/24 1,500,000 1,537
Long Island Lighting Co.,
7%, 3/1/04 3,250,000 3,127
Niagara Mohawk Power Corp.,
5 7/8%, 9/1/02 1,000,000 883
Pacific Gas & Electric Co.,
7 1/4%, 3/1/26 3,500,000 3,509
Pacific Gas & Electric Co.,
5 3/8%, 8/1/98 2,600,000 2,574
Pennsylvania Power & Light Co.,
5 1/2%, 4/1/98 3,000,000 2,980
PECO Energy Company,
7 1/2%, 1/15/99 1,500,000 1,571
<CAPTION>
MARKET
VALUE
PAR (000'S)
---------- --------
<S> <C> <C>
UTILITY-ELECTRIC (CONTINUED)
PECO Energy Company,
7 3/4%, 03/1/23 $1,150,000 $ 1,203
Public Service Electric & Gas Co.,
6 7/8%, 1/1/03 2,250,000 2,332
Texas Utilities Electric Co.,
7 7/8%, 3/1/23 2,250,000 2,406
UNICOM Corp., 6 1/2%, 4/15/00 2,300,000 2,335
--------
Total 29,390
--------
Total Bonds 163,192
--------
MONEY MARKET INVESTMENTS (16.4%)
CHEMICALS (2.3%)
E.I. du Pont de Nemours & Co.,
5.83%, 1/5/96 $4,600,000 $ 4,597
--------
FINANCE COMPANIES (2.5%)
American General Finance Corp.,
8.88%, 3/15/96 2,300,000 2,315
Transamerica Financial Corp.,
8.55%, 6/15/96 2,500,000 2,534
--------
Total 4,849
--------
FINANCIAL SERVICES (2.3%)
IBM Credit Corporation,
5.73%, 1/4/96 4,500,000 4,498
--------
FOODS (4.7%)
Nestle Capital Corp., 5.63%,
1/4/96 9,200,000 9,196
--------
PRINTING & PUBLISHING (2.3%)
Gannett Company Inc.,
5.75%, 1/10/96 4,500,000 4,493
--------
TOBACCO (2.3%)
Philip Morris Companies, Inc.
5.58%, 1/17/96 4,500,000 4,489
--------
Total Money Market Investments 32,122
--------
Total Investments $195,314
========
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
67
<PAGE> 71
NORTHWESTERN MUTUAL SERIES FUND, INC.
HIGH YIELD BOND PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
PAR (000'S)
---------- -------
<S> <C> <C>
BONDS (96.4%)
APPAREL, TEXTILES & FOOTWEAR (4.9%)
Guess, Inc., 9 1/2%, 8/15/03 $ 500,000 $ 487
+Ithaca Industries, 11 1/8%,
12/15/02 700,000 280
PT Inti Indorayon Utama, 9 1/8%,
10/15/00 1,000,000 923
Tultex Corp., 10 5/8%, 3/15/05 1,000,000 1,018
-------
Total 2,708
-------
AUTO RELATED (1.7%)
Foamex L.P., 11 1/4%, 10/1/02 1,000,000 960
-------
BANKS (3.7%)
Banamex (Nassau Branch), 9 1/8%,
4/6/00 (144A) 500,000 467
Bancomer S.A., 8%, 7/7/98 (144A) 500,000 462
First Nationwide Holdings, 12 1/4%,
5/15/01 1,000,000 1,120
-------
Total 2,049
-------
BUILDING & CONSTRUCTION (2.9%)
Primeco Inc., 12 3/4%, 3/1/05 1,500,000 1,568
-------
CABLE (7.9%)
Adelphia Communications, 12 1/2%,
5/15/02 1,000,000 975
CAI Wireless Systems Inc., 12 1/4%,
9/15/02 1,000,000 1,066
++Marcus Cable Operating, 13 1/2%,
8/1/04 1,000,000 741
Rogers Cablesystems Limited, 10%,
12/1/07 500,000 531
Rogers Communication Inc., 10 7/8%,
4/15/04 500,000 519
Groupe Videotron Ltd., 10 5/8%,
2/15/05 500,000 533
-------
Total 4,365
-------
CHEMICALS (3.8%)
Acetex Corp., 9 3/4%, 10/1/03
(144A) 1,000,000 1,040
NL Industries, Inc., 11 3/4%,
10/15/03 1,000,000 1,068
-------
Total 2,108
-------
CONTAINERS (0.8%)
Anchor Glass Container Corp.,
10 1/4%, 6/30/02 500,000 412
-------
FINANCE COMPANIES (2.8%)
Trizec Finance, 10 7/8%, 10/15/05 1,500,000 1,547
-------
FOOD SERVICE/LODGING (2.7%)
Fleming Companies, Inc., 10 5/8%,
12/15/01 500,000 495
Host Marriott Corporation, 9 1/2%,
5/15/05 1,000,000 989
-------
Total 1,484
-------
FOODS (0.8%)
+Beatrice Foods, Inc., 12%, 12/1/01 1,500,000 450
-------
<CAPTION>
MARKET
VALUE
PAR (000'S)
-------
<S> <C> <C>
GAMING (10.2%)
Aztar Corporation, 13 3/4%, 10/1/04 $1,000,000 $ 1,107
Bally's Grand, 10 3/8%, 12/15/03 1,000,000 1,015
Bally Park Place Funding, 9 1/4%,
3/15/04 500,000 505
GNF Corp., 10 5/8%, 4/1/03 1,500,000 1,387
Trump Hotels & Casino Resort,
15 1/2%, 6/15/05 1,000,000 1,070
Trump Plaza Funding, 10 7/8%,
6/15/01 500,000 518
-------
Total 5,602
-------
INSURANCE (1.9%)
Reliance Group Holdings, 9 3/4%,
11/15/03 1,000,000 1,030
-------
LEISURE RELATED (1.8%)
Samsonite Corporation, 11 1/8%,
7/15/05 1,000,000 980
-------
LODGING/RESORTS (3.7%)
HMH Properties Inc., 9 1/2%,
5/15/05 1,000,000 1,021
John Q Hammons Hotels LP, 9 3/4%,
10/1/05 (144A) 1,000,000 1,004
-------
Total 2,025
-------
MOVIE THEATERS (1.5%)
Cinemark USA, 12%, 6/1/02 750,000 806
-------
MISCELLANEOUS BASIC MATERIALS (0.7%)
Tolmex S.A. De C.V., 8 3/8%,
11/1/03 500,000 400
-------
OFFICE EQUIPMENT (2.0%)
United Stationer Supply Co.,
12 3/4%, 5/1/05 1,000,000 1,080
-------
OIL & GAS INDEPENDENT (4.6%)
Bridas Corporation, 12 1/2%,
11/15/99 1,000,000 992
Transtexas Gas, 11 1/2%, 6/15/02 1,500,000 1,549
-------
Total 2,541
-------
PAPER (7.2%)
Crown Paper Co., 11%, 9/1/05 1,000,000 875
Indah Kiat International Finance,
12 1/2%, 6/15/06 1,000,000 993
Rainy River Forest Products,
10 3/4%, 10/15/01 500,000 549
Repap Wisconsin Incorporated,
9 1/4%, 2/1/02 500,000 475
Repap New Brunswick, 10 5/8%,
4/15/05 500,000 488
SD Warren Co., 12%, 12/15/04 500,000 550
-------
Total 3,930
-------
PRINTING & PUBLISHING (1.9%)
Herff Jones Inc., 11%, 8/15/05 1,000,000 1,063
-------
PROFESSIONAL SERVICES (1.5%)
Kinder Care Learning Centers,
10 3/8%, 6/1/01 800,000 842
-------
REFINING (1.1%)
++Transamerican Refining, 18 1/2%,
2/15/02 1,000,000 605
-------
</TABLE>
68
<PAGE> 72
NORTHWESTERN MUTUAL SERIES FUND, INC.
HIGH YIELD BOND PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
PAR (000'S)
---------- -------
<S> <C> <C>
BONDS (CONTINUED)
RETAIL-FOOD (10.2%)
Brunos Inc., 10 1/2%, 8/1/05 $1,000,000 $ 987
Grand Union Company, 12%, 9/1/04 1,000,000 865
Pathmark Stores, 11 5/8%, 6/15/02 1,500,000 1,508
Penn Traffic Company,
9 5/8%, 4/15/05 1,000,000 775
Pueblo Xtra International, 9 1/2%,
8/1/03 500,000 468
Ralphs Grocery Co., 11%, 6/15/05 1,000,000 975
-------
Total 5,578
-------
SOAPS & TOILETRIES (1.9%)
American Safety Razor Co., 9 7/8%,
8/1/05 1,000,000 1,015
-------
STEEL (1.6%)
Algoma Steel, 12 3/8% 7/15/05 1,000,000 897
-------
TELECOMMUNICATIONS (4.0%)
++Bell Cablemedia Inc.,
11 7/8%, 9/15/05 (144A) 1,778,600 1,121
++Telewest PLC, 11%, 10/1/07 1,750,000 1,052
-------
Total 2,173
-------
TRUCKING-SHIPPING (3.8%)
Gearbulk Holding Ltd., 11 1/4%,
12/1/04 1,000,000 1,067
Stena AB, 10 1/2%, 12/15/05 1,000,000 1,020
-------
Total 2,087
-------
UTILITY-GAS (2.0%)
Petroleum Heat & Power, 12 1/4%,
2/1/05 1,000,000 1,115
-------
<CAPTION>
MARKET
PAR/ VALUE
SHARES (000'S)
---------- -------
<S> <C> <C>
UTILITY-PROJECT (2.8%)
CE Casecnan Water & Energy, Inc.
11.95%, 11/15/10 (144A) $1,000,000 $ 1,010
California Energy, 9 7/8%, 6/30/03 500,000 520
-------
Total 1,530
-------
Total Bonds 52,950
-------
COMMON STOCK (0.3%)
DRUGS (0.1%)
*Thrifty Payless Holdings 9,500 $ 40
-------
PAPER (0.2%)
*SDW Holdings Corporation --
Warrants 20,000 100
-------
Total Common Stock 140
-------
PREFERRED STOCK (1.1%)
PAPER (1.1%)
SD Warren Co., 14%, 12/15/06 20,000 $ 630
-------
Total Preferred Stock 630
-------
MONEY MARKET INVESTMENTS (2.2%)
CHEMICALS (1.8%)
E.I. du Pont de Nemours & Co.,
5.83%, 1/5/96 $1,000,000 $ 999
-------
FINANCIAL SERVICES (0.4%)
IBM Credit Corporation, 5.73%,
1/4/96 200,000 200
-------
Total Money Market Investments 1,199
-------
Total Investments $54,919
=======
</TABLE>
* Non-Income Producing.
+ Defaulted Security.
++ Denotes deferred interest security that receives no coupon payments until a
predetermined date at which time the stated coupon rate becomes effective.
The Accompanying Notes are an Integral Part of the Financial Statements
69
<PAGE> 73
NORTHWESTERN MUTUAL SERIES FUND, INC.
MONEY MARKET PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
PAR (000'S)
---------- --------
<S> <C> <C>
COMMERCIAL PAPER (96.5%)
BEVERAGES (4.5%)
Pepsico, Inc., 5.75%, 9/6/96 $6,000,000 $ 5,999
--------
DRUGS (4.7%)
American Home Products Corp.,
5.7%, 1/17/96 6,200,000 6,184
--------
ELECTRICAL EQUIPMENT (9.8%)
Emerson Electric Co., 5.85%,
1/3/96 6,500,000 6,498
General Electric Company, 5.76%,
1/12/96 6,400,000 6,389
--------
Total 12,887
--------
FINANCIAL SERVICES (3.8%)
IBM Credit Corporation, 5.71%,
1/11/96 5,000,000 4,992
--------
FINANCE COMPANIES (23.1%)
American General Finance Corp.,
5.71%, 1/24/96 6,200,000 6,177
AT&T Capital Corp., 5.71%, 1/26/96 6,100,000 6,076
Commercial Credit Company, 5.75%,
1/25/96 3,500,000 3,487
Commercial Credit Group Inc.,
5.81%, 1/17/96 2,500,000 2,493
Ford Motor Credit Company, 5.68%,
1/31/96 6,100,000 6,071
Transamerica Financial Corp.,
5.75%, 1/12/96 6,100,000 6,089
--------
Total 30,393
--------
FOODS (0.9%)
Cargill Incorporated, 5.75%,
1/2/96 1,200,000 1,200
--------
LUMBER (4.9%)
Weyerhaeuser Mortgage Company,
5.65%, 1/8/96 6,500,000 6,493
--------
OFFICE EQUIPMENT (5.9%)
International Business Machines
Corp.,
5.75%, 1/11/96 1,300,000 1,298
Xerox Credit Corporation, 5.7%,
1/8/96 6,500,000 6,493
--------
Total 7,791
--------
<CAPTION>
MARKET
VALUE
PAR (000'S)
---------- --------
<S> <C> <C>
PRINTING & PUBLISHING (4.8%)
Gannett Company Inc., 5.82%,
1/24/96 $6,300,000 $ 6,277
--------
RETAIL-GENERAL (4.7%)
J.C. Penney Company, Inc., 5.66%,
2/9/96 6,200,000 6,162
--------
SOAPS & TOILETRIES (4.8%)
Colgate-Palmolive Co., 5.7%,
1/23/96 6,300,000 6,278
--------
TOBACCO (8.8%)
BAT Capital Corporation, 5.75%,
1/17/96 5,400,000 5,386
Philip Morris Capital Corp.,
5.67%, 2/2/96 6,300,000 6,268
--------
Total 11,654
--------
TELECOMMUNICATIONS (1.5%)
Motorola, Inc., 5.75%, 1/3/96 2,000,000 1,999
--------
UTILITY-ELECTRIC (9.4%)
National Rural Utility Finance
Corp., 5.66%, 2/23/96 6,300,000 6,247
Southern California Edison Co.,
5.69%, 1/19/96 6,100,000 6,083
--------
Total 12,330
--------
UTILITY-TELEPHONE (4.9%)
Bellsouth Telecommunication,
5.75%, 1/9/96 6,500,000 6,492
--------
Total Commercial Paper 127,131
--------
ASSET-BACKED SECURITIES (3.5%)
AUTO RELATED (3.5%)
Carco Auto Loan Master Trust,
5.905%, 10/16/00
(Variable rate; puttable; coupon
indexed to one month Commercial
Paper rate plus 7.5 basis
points; reset monthly) 4,550,000 $ 4,550
--------
Total Asset-Backed Securities 4,550
--------
Total Investments $131,681
========
</TABLE>
The Accompany Notes are an Integral Part of the Financial Statements
70
<PAGE> 74
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
COMMON STOCK (50.8%)
AEROSPACE (1.2%)
Boeing Company 78,400 $ 6,145
E G & G, Inc. 12,000 291
General Dynamics Corporation 14,400 851
Lockheed Martin Corporation 45,861 3,623
Loral Corporation 39,200 1,387
McDonnell Douglas Corporation 25,900 2,383
Northrop Corporation 11,300 723
Raytheon Company 55,800 2,637
Rockwell International Corp. 49,700 2,628
TRW Inc. 14,900 1,155
United Technologies Corp. 28,200 2,675
----------
Total 24,498
----------
AIRLINES (0.1%)
*AMR Corporation 17,500 1,299
Delta Air Lines, Inc. 11,600 857
Southwest Airlines Co. 32,900 765
*USAir Group, Inc. 14,200 188
----------
Total 3,109
----------
APPAREL, TEXTILES AND FOOTWEAR (0.2%)
Brown Group, Inc. 4,100 58
*Fruit of the Loom Incorporated 17,400 424
Liz Claiborne, Inc. 17,200 477
Nike, Inc. 32,700 2,277
Reebok International Ltd. 17,900 506
Russell Corp. 8,900 247
Springs Industries, Inc. 4,600 190
Stride Rite Corp. 11,300 85
VF Corporation 14,600 770
----------
Total 5,034
----------
AUTO & TRUCKS (1.0%)
Chrysler Corporation 87,500 4,845
Ford Motor Company 245,900 7,131
General Motors Corporation 171,100 9,047
*Navistar International Corp. 17,170 180
PACCAR Incorporated 8,895 375
----------
Total 21,578
----------
AUTO RELATED (0.3%)
Cooper Tire & Rubber Company 19,100 470
Dana Corporation 23,200 679
Eaton Corporation 17,800 955
Echlin Inc. 13,600 496
Genuine Parts Company 28,150 1,154
Goodyear Tire & Rubber Company 34,900 1,584
ITT Industries Inc. 26,500 636
Snap-On Incorporated 9,200 416
----------
Total 6,390
----------
BANKS (3.3%)
Banc One Corporation 90,282 3,408
Bank of Boston Corporation 25,600 1,184
Bank of New York Company Inc. 44,000 2,145
BankAmerica Corporation 85,700 5,549
Bankers Trust New York Corp. 17,900 1,190
Barnett Banks Inc. 22,200 1,310
Boatmans Bancshares, Inc. 28,800 1,177
Chase Manhattan Corporation 39,900 2,419
Chemical Banking Corporation 57,700 3,390
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
BANKS (CONTINUED)
Citicorp 97,300 $ 6,543
Comerica, Inc. 26,200 1,051
Corestates Financial Corp. 31,900 1,208
First Bank System Inc. 31,000 1,538
First Chicago NBD Corp. 72,705 2,872
First Fidelity Bancorporation 18,300 1,379
First Interstate Bancorp 17,400 2,375
First Union Corporation 39,300 2,186
Fleet Financial Group Inc. 58,619 2,389
KeyCorp 52,100 1,889
Mellon Bank Corporation 33,550 1,803
J.P. Morgan & Company, Inc. 43,000 3,451
National City Corp. 33,700 1,116
NationsBank Corp. 62,100 4,324
Norwest Corporation 80,800 2,666
PNC Financial Corp. 52,700 1,700
P P & L Resources Inc. 36,200 905
Republic New York Corporation 12,800 795
Suntrust Banks Inc. 26,100 1,788
U.S. Bancorp of Oregon 22,500 757
Wachovia Corporation 39,200 1,793
Wells Fargo & Company 11,000 2,376
----------
Total 68,676
----------
BEVERAGES (1.9%)
Anheuser-Busch Companies Inc. 58,500 3,912
Brown-Forman Corp. 15,800 577
Coca-Cola Company 288,700 21,436
Adolph Coors Co. 8,800 195
Pepsico Inc. 180,300 10,074
Seagram Company Ltd. 85,200 2,950
----------
Total 39,144
----------
BUILDING & CONSTRUCTION (0.2%)
Centex Corporation 6,400 222
Crane Co. 7,000 258
Kaufman & Broad Home Corp. 7,400 110
Masco Corporation 36,300 1,139
*Owens Corning Fiberglas Corp. 11,600 521
Pulte Corporation 6,200 208
Sherwin-Williams Company 19,500 795
----------
Total 3,253
----------
BUILDING-FOREST PRODUCTS (0.3%)
Boise Cascade Corporation 10,900 377
Champion International 22,100 928
Georgia-Pacific Corp. 20,800 1,427
Louisiana Pacific Corporation 24,700 599
Potlatch Corporation 6,700 268
Weyerhaeuser Company 46,500 2,011
----------
Total 5,610
----------
CHEMICALS (1.5%)
Air Products & Chemicals, Inc. 25,600 1,350
Dow Chemical Company 61,600 4,335
E.I. du Pont de Nemours & Company 127,000 8,874
Eastman Chemical Company 18,575 1,163
Ecolab, Inc. 14,700 441
*FMC Corporation 8,400 568
Freeport McMoRan Copper & Gold Inc. 46,600 1,311
</TABLE>
71
<PAGE> 75
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
COMMON STOCK (CONTINUED)
CHEMICALS (CONTINUED)
B.F. Goodrich Company 5,900 $ 402
W.R. Grace & Co. 21,700 1,283
Great Lakes Chemical 14,800 1,066
Hercules Incorporated 25,500 1,438
Mallinckrodt Group 17,500 637
Monsanto Company 26,400 3,234
PPG Industries Inc. 46,400 2,123
Praxair, Inc. 31,700 1,066
Rohm & Haas Company 15,500 998
Union Carbide Corporation 31,400 1,178
----------
Total 31,467
----------
CHEMICALS-SPECIALITY (0.2%)
Avery Dennison Corp. 12,200 612
Engelhard Corp. 32,800 713
Morton International, Inc. 33,900 1,216
Nalco Chemical Company 15,500 467
Sigma-Aldrich Corp. 11,400 564
----------
Total 3,572
----------
COAL, GAS & PIPELINE (0.1%)
Eastern Enterprises 4,600 162
NACCO Industries, Inc. 2,100 117
Sonat Inc. 19,800 705
----------
Total 984
----------
CONTAINERS (0.1%)
Ball Corporation 6,900 190
Bemis Company, Inc. 11,800 302
*Crown Cork & Seal Company,
Inc. 20,600 860
----------
Total 1,352
----------
DIVERSIFIED (1.1%)
Allied Signal Inc. 64,800 3,078
Corning Inc. 52,600 1,683
Dial Corp. 21,300 631
ITT Corp. 26,500 1,404
Loews Corp. 27,000 2,116
Minnesota Mining & Manufacturing Co. 96,200 6,373
National Service Industries,
Inc. 11,100 359
Ogden Corporation 11,200 239
*Teledyne, Inc. 12,700 325
Tenneco Inc. 41,400 2,054
Textron Inc. 19,500 1,316
Tyco Laboratories, Inc. 35,000 1,247
Whitman Corporation 24,000 558
Worthington Industries 20,800 433
----------
Total 21,816
----------
DRUGS (3.3%)
*Alza Corp. 18,900 468
American Home Products Corp. 70,900 6,877
*Amgen Inc. 60,600 3,598
Bristol-Myers Squibb Company 116,100 9,970
Eli Lilly & Company 126,200 7,099
Merck & Co., Inc. 283,100 18,614
Pharmacia & Upjohn Inc. 115,330 4,469
Pfizer Inc. 144,600 9,110
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
DRUGS (CONTINUED)
Schering-Plough Corporation 85,200 $ 4,665
Warner-Lambert Company 30,900 3,001
----------
Total 67,871
----------
ELECTRICAL EQUIPMENT (1.8%)
Emerson Electric Co. 51,400 4,202
General Electric Company 387,800 27,922
W.W. Grainger, Inc. 11,600 769
Honeywell Inc. 29,100 1,415
Raychem Corp. 10,000 569
Thomas & Betts Corporation 4,500 332
Westinghouse Electric Corp. 89,800 1,482
----------
Total 36,691
----------
ELECTRONICS (1.0%)
*Advanced Micro Devices, Inc. 23,800 393
AMP Incorporated 49,836 1,912
*Applied Materials Inc. 40,400 1,591
Harris Corporation 8,900 486
Intel Corp. 188,500 10,697
*LSI Logic 29,300 960
Micron Technology 47,200 1,870
*National Semiconductor Corp. 28,300 630
Perkin-Elmer Corporation 9,600 362
Tektronix, Inc. 7,600 373
Texas Instruments Incorporated 43,000 2,225
----------
Total 21,499
----------
ENGINEERING & CONSTRUCTION (0.1%)
Fluor Corporation 18,900 1,247
----------
ENVIRONMENTAL CONTROL (0.3%)
Browning-Ferris Industries Inc. 48,700 1,437
Johnson Controls Inc. 9,400 646
Laidlaw Transportation Limited 67,300 690
Millipore Corp. 10,300 424
Safety-Kleen Corp. 13,200 206
WMX Technologies, Inc. 111,000 3,316
----------
Total 6,719
----------
FEDERAL GOVERNMENT AND AGENCIES (0.5%)
Federal Home Loan Mortgage
Corp. 41,400 3,457
Federal National Mortgage
Assoc. 62,500 7,758
----------
Total 11,215
----------
FINANCIAL SERVICES (1.0%)
American Express Company 111,600 4,617
Beneficial Corp. 12,100 564
Dean Witter, Discover & Co. 38,650 1,817
Household International Inc. 22,300 1,318
MBNA Corp. 33,950 1,252
Marsh & McLennan Companies,
Inc. 16,600 1,473
Merrill Lynch & Co., Inc. 40,300 2,055
Morgan Stanley Group Inc. 17,600 1,419
Salomon Inc. 24,400 866
Transamerica Corporation 15,700 1,144
Travelers Group Inc. 73,146 4,599
----------
Total 21,124
----------
</TABLE>
72
<PAGE> 76
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
COMMON STOCK (CONTINUED)
FOOD SERVICE/LODGING (0.5%)
*Darden Restaurant Inc. 36,200 $ 430
*Harrah's Entertainment 23,500 570
Hilton Hotels Corporation 11,000 677
Luby's Cafeterias, Inc. 5,300 118
Marriott International 28,700 1,098
McDonald's Corporation 159,100 7,179
*Ryan's Family Steak Houses,
Inc. 12,200 85
*Shoney's Inc. 9,500 97
Wendy's International, Inc. 23,400 497
----------
Total 10,751
----------
FOODS (1.6%)
Archer Daniels Midland Company 124,084 2,234
CPC International Corp. 33,400 2,292
Campbell Soup Company 57,100 3,426
ConAgra Inc. 56,200 2,318
General Mills, Inc. 36,300 2,096
H.J. Heinz Company 83,650 2,771
Hershey Foods Corp. 17,800 1,157
Kellogg Company 50,200 3,878
Pioneer Hi-Bred International 19,200 1,068
Quaker Oats Company 30,700 1,059
Ralston Purina Group 23,800 1,485
Sara Lee Corporation 109,800 3,500
Unilever, N.V. 36,600 5,152
Wm. Wrigley Jr. Company 26,600 1,397
----------
Total 33,833
----------
HOSPITAL SUPPLIES (2.1%)
Abbott Laboratories Inc. 181,700 7,586
Allergan Incorporated 14,700 478
Allergan Incorporated -- Rights 463 0
C.R. Bard, Inc. 12,700 410
Bausch & Lomb Inc. 13,100 519
Baxter International Inc. 63,400 2,655
Becton, Dickinson & Company 15,100 1,133
*Beverly Enterprises, Inc. 22,500 239
*Biomet, Inc. 26,400 472
*Boston Scientific Corp. 37,100 1,818
Columbia/HCA Healthcare Corp. 101,600 5,156
*Community Psychiatric Centers 10,000 123
Humana, Inc. 37,000 1,013
Johnson & Johnson 147,700 12,647
Manor Care, Inc. 14,300 501
Medtronic, Incorporated 52,900 2,956
St. Jude Medical, Inc. 16,050 690
*Tenet Healthcare Corp. 45,800 950
United Healthcare Corp. 39,700 2,600
U.S. HealthCare Incorporated 35,200 1,637
U.S. Surgical Corporation 13,000 278
----------
Total 43,861
----------
HOUSEHOLD FURNITURE/APPLIANCES (0.3%)
Armstrong World Industries Inc. 8,500 527
Black & Decker Corporation 19,600 691
Maytag Corporation 24,600 498
Newell Co. 36,200 937
Premark International, Inc. 14,500 734
Rubbermaid, Inc. 36,200 923
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
HOUSEHOLD FURNITURE/APPLIANCES (CONTINUED)
Stanley Works 10,200 $ 525
Whirlpool Corporation 16,900 900
----------
Total 5,735
----------
INSURANCE (1.6%)
Aetna Life & Casualty Company 25,900 1,794
Alexander & Alexander Services 10,100 192
Allstate Corporation 102,647 4,221
American General Corporation 46,900 1,636
American International Group,
Inc. 108,550 10,041
CIGNA Corporation 16,600 1,714
Chubb Corporation 19,900 1,925
General Re Corporation 18,800 2,914
ITT Hartford Group 26,500 1,282
Jefferson-Pilot Corp. 16,350 760
Lincoln National Corporation 23,800 1,279
Providian Corporation 21,800 888
SAFECO Inc. 28,800 994
St. Paul Companies, Inc. 19,400 1,079
Torchmark Corporation 16,400 742
UNUM Corporation 16,600 913
USF&G Corp. 25,600 432
USLIFE Corporation 7,850 235
----------
Total 33,041
----------
LEISURE RELATED (0.8%)
*3COM Corp. 34,400 1,604
*Bally Entertainment
Corporation 10,800 151
Brunswick Corporation 21,900 526
Walt Disney Company 119,200 7,033
Fleetwood Enterprises, Inc. 10,500 270
Handlemann Co. 7,700 44
Hasbro Inc. 20,100 623
*King World Productions, Inc. 8,400 327
Mattel, Inc. 50,768 1,561
Outboard Marine Corporation 4,600 94
*Viacom Incorporated 82,656 3,792
----------
Total 16,025
----------
MACHINERY (0.6%)
Briggs & Stratton Corporation 6,900 299
Caterpillar Inc. 45,500 2,673
Cincinnati Milacron Inc. 7,800 205
Cooper Industries, Inc. 24,600 904
Cummins Engine Company, Inc. 9,300 344
Deere & Company 59,500 2,097
Dover Corporation 26,000 959
Foster Wheeler Corporation 9,200 391
General Signal Corporation 10,900 353
Giddings & Lewis Company 7,900 130
Harnischfeger Industries, Inc. 11,000 366
Illinois Tool Works Inc. 26,900 1,587
Ingersoll-Rand Company 24,200 850
Pall Corporation 26,166 703
Parker-Hannifin Corporation 16,900 579
Timken Company 7,100 272
TRINOVA Corp. 6,600 189
*Varity Corporation 9,300 345
----------
Total 13,246
----------
</TABLE>
73
<PAGE> 77
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
COMMON STOCK (CONTINUED)
MEDIA (0.4%)
Capital Cities/ABC, Inc. 35,200 $ 4,343
Comcast Corp. 54,850 998
*Tele-Communications, Inc. 149,400 2,969
----------
Total 8,310
----------
METALS & MINING (0.6%)
Alcan Aluminum Limited 51,600 1,606
Aluminum Co. of America 40,900 2,163
ASARCO, Inc. 9,700 310
Barrick Gold Corporation 80,900 2,134
Cyprus Minerals Co. 21,200 554
Echo Bay Mines Limited Co. 25,800 268
Homestake Mining Company 31,600 494
Inco Limited 27,200 904
Newmont Mining Corporation 19,689 891
Phelps Dodge Corporation 15,900 990
Placer Dome Incorporated 54,700 1,320
Reynolds Metals Company 14,500 821
Santa Fe Pacific Gold
Corporation 30,040 364
----------
Total 12,819
----------
OFFICE EQUIPMENT (2.1%)
*Amdahl Corporation 27,200 231
Apple Computer, Inc. 27,700 883
*Cabletron Systems Inc. 16,400 1,328
*Cisco Systems Incorporated 62,100 4,634
*Compaq Computer Corporation 60,500 2,904
*Cray Research, Inc. 5,800 144
*Data General Corporation 8,500 117
*Digital Equipment Corporation 33,600 2,155
Hewlett-Packard Company 117,100 9,807
*Intergraph Corp. 10,500 165
International Business Machines Corp. 130,200 11,946
Moore Corporation Ltd. 22,900 427
Pitney Bowes Inc. 34,700 1,631
*Silicon Graphics 36,300 998
*Sun Microsystems Inc. 43,800 1,998
*Tandem Computers Inc. 26,600 283
*Unisys Corporation 39,200 221
Xerox Corporation 24,600 3,370
----------
Total 43,242
----------
OFFICE EQUIPMENT-SERVICES (1.4%)
Alco Standard Corporation 25,500 1,163
Autodesk, Inc. 10,800 370
Automatic Data Processing, Inc. 32,900 2,443
*Ceridian Corp. 15,100 623
Computer Associates International Inc. 54,950 3,125
*Computer Sciences Corp. 12,700 892
First Data Corporation 50,400 3,371
*Microsoft Corporation 134,100 11,767
*Novell, Inc. 84,500 1,204
*Oracle Corporation 99,200 4,204
Shared Medical Systems Corp. 5,300 288
----------
Total 29,450
----------
OIL & GAS-DOMESTIC (0.8%)
Amerada Hess Corp. 21,300 1,129
Ashland Inc. 14,600 513
Atlantic Richfield Company 36,800 4,076
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
OIL & GAS-DOMESTIC (CONTINUED)
Burlington Resource Inc. 29,000 $ 1,138
Coastal Corp. 24,000 894
Kerr-McGee Corporation 11,900 756
Louisiana Land & Exploration
Co. 7,700 330
Occidental Petroleum
Corporation 72,800 1,556
*Oryx Energy Company 23,700 317
Pennzoil Company 10,600 448
Phillips Petroleum Company 60,000 2,048
*Santa Fe Energy Resources,
Inc. 20,700 199
Sun Company, Inc. 17,300 474
Unocal Corp. 56,400 1,643
----------
Total 15,521
----------
OIL & GAS-INTERNATIONAL (3.4%)
Amoco Company 113,700 8,172
Chevron Corp. 149,300 7,838
Exxon Corporation 284,400 22,788
Mobil Corporation 90,600 10,147
Royal Dutch Petroleum Co., ADR 122,700 17,316
Texaco Inc. 59,500 4,671
----------
Total 70,932
----------
OIL FIELD SERVICES (0.4%)
Baker Hughes Inc. 32,300 787
Dresser Industries, Inc. 41,800 1,019
Halliburton Company 26,100 1,321
Helmerich & Payne, Inc. 5,700 170
McDermott International, Inc. 12,400 273
*Rowan Companies, Inc. 19,300 191
Schlumberger Limited 55,400 3,836
*Western Atlas Inc. 12,200 616
----------
Total 8,213
----------
PAPER (0.6%)
Federal Paper Board Co. 10,500 545
International Paper Company 58,300 2,208
James River Corp. of Virginia 18,900 456
Kimberly-Clark Corporation 63,766 5,277
Mead Corp. 12,300 643
*Stone Container Corporation 21,900 315
Temple-Inland Inc. 12,800 565
Union Camp Corporation 16,100 767
Westvaco Corporation 23,150 642
Willamette Industries Inc. 12,600 709
----------
Total 12,127
----------
PHOTO & OPTICAL (0.3%)
Eastman Kodak Company 78,300 5,246
Polaroid Corporation 10,300 488
----------
Total 5,734
----------
PRINTING & PUBLISHING (0.8%)
American Greetings Corp. 17,000 470
Deluxe Corp. 18,900 548
R.R. Donnelley & Sons Company 35,100 1,382
Dow Jones & Company, Inc. 22,200 885
Dun & Bradstreet Corporation 38,800 2,512
Gannett Company Inc. 32,100 1,970
Harcourt General 16,600 695
John H. Harland Company 7,000 146
Jostens, Inc. 8,800 213
</TABLE>
74
<PAGE> 78
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
COMMON STOCK (CONTINUED)
PRINTING & PUBLISHING (CONTINUED)
Knight-Ridder Inc. 11,200 $ 700
McGraw-Hill Companies Inc. 11,400 993
Meredith Corporation 6,300 264
New York Times Company 22,200 658
Time Warner Inc. 88,400 3,348
Times Mirror Company 25,700 871
Tribune Company 14,900 911
----------
Total 16,566
----------
PROFESSIONAL SERVICES (0.2%)
H & R Block, Inc. 24,000 972
*CUC International Inc. 39,850 1,360
Interpublic Group of Cos. Inc. 17,900 776
Service Corporation
International 23,700 1,043
----------
Total 4,151
----------
RAILROADS (0.6%)
Burlington Northern Santa Fe
Co. 32,533 2,538
CSX Corporation 48,200 2,199
Conrail Incorporated 17,900 1,253
Norfolk Southern Corporation 30,000 2,381
Union Pacific Corporation 47,000 3,102
----------
Total 11,473
----------
RETAIL-FOOD (0.4%)
Albertson's, Inc. 58,200 1,913
American Stores Co. 34,000 910
Fleming Companies, Inc. 8,600 177
Giant Food Inc. 13,600 428
Great Atlantic & Pacific Tea
Co., Inc. 8,700 200
Kroger Company 28,100 1,054
Supervalu Inc. 15,600 491
Sysco Corporation 41,700 1,355
Winn-Dixie Stores, Inc. 34,600 1,276
----------
Total 7,804
----------
RETAIL-GENERAL (2.0%)
Charming Shoppes Incorporated 23,600 68
Circuit City Stores, Inc. 22,200 613
Dayton Hudson Corporation 16,400 1,230
Dillard Department Stores, Inc. 25,900 738
*Federated Department Stores,
Inc. 46,300 1,273
The Gap, Inc. 33,000 1,386
Home Depot, Inc. 109,066 5,222
K Mart Corporation 105,000 761
The Limited Inc. 81,800 1,421
Longs Drug Stores Corp. 4,700 225
Lowe's Companies, Inc. 36,700 1,229
May Department Stores Company 56,900 2,404
Melville Corporation 24,000 738
Mercantile Stores Company 8,400 389
Nordstrom, Inc. 18,800 761
J.C. Penney Company, Inc. 52,000 2,477
Pep Boys - Manny, Moe & Jack 14,100 361
*Price/Costco, Inc. 44,651 681
Rite Aid Corporation 19,200 658
Sears, Roebuck & Company 89,200 3,479
TJX Companies, Inc. 16,600 313
Tandy Corporation 14,900 618
*Toys "R" Us 63,300 1,377
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
RETAIL-GENERAL (CONTINUED)
Wal-Mart Stores, Inc. 525,900 $ 11,767
Walgreen Company 56,300 1,682
*Woolworth Corp. 30,300 394
----------
Total 42,265
----------
SAVINGS & LOAN (0.1%)
H.F. Ahmanson & Company 26,800 710
Golden West Financial Corp. 13,400 740
Great Western Financial Corp. 31,100 793
----------
Total 2,243
----------
SOAPS & TOILETRIES (1.2%)
Alberto-Culver Company 6,300 217
Avon Products, Inc. 15,700 1,183
The Clorox Company 12,200 874
Colgate-Palmolive Co. 33,300 2,339
Gillette Company 101,500 5,291
International Flavors & Fragrances,
Inc. 25,500 1,224
The Procter & Gamble Company 157,400 13,064
----------
Total 24,192
----------
STEEL (0.2%)
*Armco Inc. 24,300 143
Bethlehem Steel Corporation 25,300 354
Inland Steel Industries, Inc. 11,100 279
Nucor Corp. 20,000 1,143
USX-Marathon Group 68,000 1,326
USX-U S Steel Group Inc. 18,700 575
----------
Total 3,820
----------
TELECOMMUNICATIONS (1.7%)
AT&T Corporation 363,100 23,511
*Andrew Corporation 8,850 339
*DSC Communications Corp. 26,300 970
Motorola, Inc. 135,000 7,695
Northern Telecom Limited 58,100 2,498
Scientific-Atlanta, Inc. 17,600 264
*Tellabs Inc. 20,200 747
----------
Total 36,024
----------
TOBACCO (1.0%)
American Brands Inc. 43,200 1,928
Philip Morris Companies, Inc. 192,300 17,403
UST Incorporated 44,700 1,492
----------
Total 20,823
----------
TRANSPORTATION-MISCELLANEOUS (0.0%)
Pittston Services Group 9,500 298
----------
TRUCKING-SHIPPING (0.1%)
Caliber Systems Inc. 8,900 435
Consolidated Freightways, Inc. 9,900 262
*Federal Express Corp. 12,900 953
Ryder System, Inc. 18,000 446
Yellow Corp. 6,400 79
----------
Total 2,175
----------
UTILITY-ELECTRIC (1.9%)
American Electric Power Co.
Inc. 42,600 1,725
Baltimore Gas & Electric Co. 33,800 963
Carolina Power & Light Company 35,600 1,228
Central & South West
Corporation 43,900 1,224
</TABLE>
75
<PAGE> 79
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (000'S)
----------- ----------
<S> <C> <C>
COMMON STOCK (CONTINUED)
UTILITY-ELECTRIC (CONTINUED)
Cinergy Corporation 35,705 $ 1,093
Consolidated Edison Co. of New York 53,800 1,722
DTE Energy Company 33,600 1,159
Dominion Resources Inc. 39,700 1,638
Duke Power Company 46,900 2,222
Entergy Corporation 52,100 1,524
FPL Group, Inc. 42,400 1,966
General Public Utilities 26,600 904
Houston Industries Incorporated 60,100 1,457
Niagara Mohawk Power
Corporation 33,000 318
Northern States Power Company 15,500 761
Ohio Edison Company 34,900 820
PECO Energy Company 50,800 1,530
Pacific Enterprises 19,400 548
Pacific Gas & Electric Co. 97,200 2,758
PacifiCorp 65,100 1,383
Public Service Enterprise Group, Inc. 56,000 1,715
SCECorp 102,100 1,812
Southern Company 152,400 3,753
Texas Utilities Company 51,700 2,126
UNICOM Corp. 49,100 1,608
Union Electric Company 23,400 977
----------
Total 38,934
----------
UTILITY-GAS (0.3%)
*Columbia Gas System Inc. 11,600 509
Consolidated Natural Gas Co. 21,400 971
Enron Corp. 57,700 2,200
ENSERCH Corporation 15,700 255
Nicor Inc. 11,600 319
Noram Energy Corporation 28,400 252
ONEOK, Inc. 6,200 142
Panhandle Eastern Corporation 34,300 956
Peoples Energy Corporation 8,000 254
Williams Companies Inc. 23,400 1,027
----------
Total 6,885
----------
UTILITY-TELEPHONE (3.3%)
*Airtouch Communications 113,100 3,195
ALLTEL Corporation 43,200 1,274
Ameritech Corporation 126,900 7,487
Bell Atlantic Corporation 99,900 6,681
Bellsouth Corporation 227,300 9,888
GTE Corporation 222,000 9,768
MCI Communications Corporation 155,200 4,055
NYNEX Corp. 97,800 5,281
Pacific Telesis Group 98,100 3,299
SBC Communications Incorporated 139,500 8,021
Sprint Corporation 79,800 3,182
U S West Inc. 107,800 3,854
*U S West Media Group 107,800 2,048
----------
Total 68,033
----------
Total Common Stock 1,051,375
----------
PREFERRED STOCK (0.00%)
DIVERSIFIED (0.00%)
Teledyne, Inc. 514 $ 7
----------
Total Preferred Stock 7
----------
<CAPTION>
MARKET
VALUE
PAR (000'S)
----------- ----------
<S> <C> <C>
BONDS (33.5%)
AIRLINES (0.3%)
Delta Air Lines, Inc.,
9 3/4%, 5/19/03 $ 532,000 $ 622
Delta Air Lines, Inc.,
9 3/4%, 6/1/03 3,513,000 4,108
Delta Air Lines, Inc.,
9 3/4%, 6/1/03 870,000 1,017
Delta Air Lines, Inc.,
9 3/4%, 6/1/03 870,000 1,017
----------
Total 6,764
----------
AUTO RELATED (0.6%)
Hertz Corp., 9.04%, 6/14/00 4,100,000 4,585
General Motors Corporation,
8 4/5%, 3/1/21 6,500,000 8,148
----------
12,733
----------
BANKS (0.6%)
Natwest Capital Corporation,
12 1/8%, 11/15/02 10,450,000 11,593
----------
BEVERAGES (0.6%)
Coca-Cola Enterprises Inc.,
8%, 1/4/05 10,000,000 11,398
----------
CMO & LOAN-BACKED CERTIFICATES (5.5%)
CIT RV Owner Trust,
6 1/4%, 1/15/11 6,566,806 6,644
Federal Home Loan Mortgage
Corp.,
7 1/4%, 4/15/18 10,325,000 10,442
Federal Home Loan Mortgage
Corp.,
7%, 3/15/07 7,250,000 7,428
Federal Home Loan Mortgage
Corp.,
6%, 7/15/07 19,250,000 19,288
Federal National Mortgage
Assoc.,
6 1/4%, 7/25/07 21,150,000 21,471
Federal National Mortgage
Assoc.,
6 3/4%, 12/25/23 6,500,000 6,412
Ford Motor Credit Grantor
Trust, 5.9%, 10/15/00 6,808,877 6,847
Premier Auto Trust, 6.65%,
4/2/98 6,930,000 7,019
Rural Housing Trust, 6.33%,
4/1/26 9,859,581 9,769
Security Capital Industrial
Trust, 7.3%, 5/15/01 8,000,000 8,067
World Omni Grantor Trust,
7.95%, 1/25/1 10,000,000 10,209
----------
Total 113,596
----------
CHEMICALS (0.5%)
Dow Capital B.V., 8 1/2, 6/8/10 8,200,000 9,806
----------
DIVERSIFIED (0.5%)
Hanson Overseas BV, 6 3/4%,
9/15/05 10,000,000 10,351
----------
FEDERAL GOVERNMENT AND AGENCIES (13.1%)
Federal Home Loan Mortgage Corp.,
7%, 7/1/25 4,889,608 4,934
Federal Home Loan Mortgage Corp.,
7%, 7/1/25 4,154,794 4,192
</TABLE>
76
<PAGE> 80
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
PAR (000'S)
----------- ----------
<S> <C> <C>
BONDS (CONTINUED)
FEDERAL GOVERNMENT AND AGENCIES
(CONTINUED)
Federal Home Loan Mortgage Corp.,
7%, 7/1/25 $ 4,880,888 $ 4,925
Federal Home Loan Mortgage Corp.,
7%, 7/1/25 14,842,376 14,977
Government National Mortgage Assoc.,
7%, 9/15/23 114,400 116
Government National Mortgage Assoc.,
7%, 10/15/23 210,954 214
Government National Mortgage Assoc.,
7 1/2%, 8/15/24 974,548 1,002
Government National Mortgage Assoc.,
7%, 9/15/23 25,680 26
Government National Mortgage Assoc.,
7%, 7/15/23 814,310 825
Government National Mortgage Assoc.,
7%, 5/15/23 9,123,303 9,244
Government National Mortgage Assoc.,
7%, 5/15/23 6,718,886 6,808
Government National Mortgage Assoc.,
7%, 6/15/23 332,144 337
Government National Mortgage Assoc.,
7%, 10/15/23 30,031 30
Government National Mortgage Assoc.,
7%, 5/15/23 206,740 209
Government National Mortgage Assoc.,
7 1/2%, 1/15/24 225,604 232
Government National Mortgage Assoc.,
7%, 7/15/23 780,387 791
Government National Mortgage Assoc.,
7%, 2/15/24 43,696 44
Government National Mortgage Assoc.,
8 1/2%, 2/15/25 145,959 153
Government National Mortgage Assoc.,
7%, 8/15/23 29,352 30
Government National Mortgage Assoc.,
8 1/2%, 7/15/24 257,946 271
Government National Mortgage Assoc.,
7%, 6/15/23 733,591 743
Government National Mortgage Assoc.,
7%, 7/15/23 66,575 67
Government National Mortgage Assoc.,
7%, 10/15/23 164,119 166
Government National Mortgage Assoc.,
7%, 9/15/23 684,039 693
Government National Mortgage Assoc.,
7 1/2%, 5/15/24 1,056,577 1,087
Government National Mortgage Assoc.,
7%, 12/15/23 828,855 840
Government National Mortgage Assoc.,
7%, 10/15/23 122,080 124
Government National Mortgage Assoc.,
7 1/2%, 1/15/24 1,129,651 1,162
Government National Mortgage Assoc.,
8 1/2%, 8/15/24 326,635 343
Government National Mortgage Assoc.,
7%, 11/15/23 802,273 813
Government National Mortgage Assoc.,
7%, 2/15/24 135,214 137
Government National Mortgage Assoc.,
7%, 11/15/23 855,263 867
Government National Mortgage Assoc.,
8 1/2%, 2/15/25 814,055 855
<CAPTION>
MARKET
VALUE
PAR (000'S)
----------- ----------
<S> <C> <C>
FEDERAL GOVERNMENT AND AGENCIES
(CONTINUED)
Government National Mortgage Assoc.,
7%, 12/15/23 $ 707,558 $ 717
Government National Mortgage Assoc.,
7%, 2/15/24 334,093 338
Government National Mortgage Assoc.,
7%, 1/15/24 882,744 894
Government National Mortgage Assoc.,
7%, 3/15/24 672,864 682
Government National Mortgage Assoc.,
7%, 12/15/23 884,388 896
Government National Mortgage Assoc.,
7%, 11/15/23 585,513 593
Government National Mortgage Assoc.,
8 1/2%, 11/15/24 307,285 323
Government National Mortgage Assoc.,
7%, 9/15/23 35,377 36
Government National Mortgage Assoc.,
7%, 2/15/24 714,898 724
Government National Mortgage Assoc.,
8 1/2%, 7/15/24 250,180 263
Government National Mortgage Assoc.,
7%, 1/15/24 53,116 54
Government National Mortgage Assoc.,
7%, 10/15/23 123,108 125
Government National Mortgage Assoc.,
8 1/2%, 11/15/24 242,877 255
Government National Mortgage Assoc.,
8 1/2%, 1/15/25 23,318 24
Government National Mortgage Assoc.,
7%, 1/15/24 232,671 236
Government National Mortgage Assoc.,
7 1/2%, 11/15/24 1,004,173 1,033
Government National Mortgage Assoc.,
8 1/2%, 7/15/24 343,514 361
Government National Mortgage Assoc.,
7 1/2%, 2/15/24 1,624,140 1,670
Government National Mortgage Assoc.,
7 1/2%, 3/15/24 1,471,828 1,514
Government National Mortgage Assoc.,
7 1/2%, 8/15/24 983,454 1,011
Government National Mortgage Assoc.,
7%, 2/15/24 779,800 790
Government National Mortgage Assoc.,
7%, 5/15/24 783,349 794
Government National Mortgage Assoc.,
7 1/2%, 5/15/24 1,403,025 1,443
Government National Mortgage Assoc.,
7 1/2%, 4/15/24 925,585 952
Government National Mortgage Assoc.,
7 1/2%, 5/15/24 1,470,957 1,513
Government National Mortgage Assoc.,
8 1/2%, 6/15/24 807,670 848
Government National Mortgage Assoc.,
7%, 4/15/24 121,260 123
Government National Mortgage Assoc.,
7%, 4/15/24 28,018 28
Government National Mortgage Assoc.,
8 1/2%, 6/15/24 313,370 329
Government National Mortgage Assoc.,
8 1/2%, 7/15/24 216,054 227
Government National Mortgage Assoc.,
8 1/2%, 1/15/25 57,533 60
Government National Mortgage Assoc.,
8 1/2%, 2/15/25 452,785 475
</TABLE>
77
<PAGE> 81
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
PAR (000'S)
----------- ----------
<S> <C> <C>
BONDS (CONTINUED)
FEDERAL GOVERNMENT AND AGENCIES
(CONTINUED)
Government National Mortgage Assoc.,
8 1/2%, 8/15/24 $ 346,522 $ 364
Government National Mortgage Assoc.,
7%, 4/15/24 95,608 97
Government National Mortgage Assoc.,
7 1/2%, 6/15/24 1,430,337 1,471
Government National Mortgage Assoc.,
8 1/2%, 7/15/24 230,976 242
Government National Mortgage Assoc.,
8 1/2%, 8/15/24 242,134 254
Government National Mortgage Assoc.,
7 1/2%, 8/15/24 990,722 1,019
Government National Mortgage Assoc.,
8 1/2%, 1/15/25 135,128 142
Government National Mortgage Assoc.,
7 1/2%, 8/15/24 1,241,086 1,276
Government National Mortgage Assoc.,
8 1/2%, 8/15/24 221,321 232
Government National Mortgage Assoc.,
8 1/2%, 2/15/25 218,143 229
Government National Mortgage Assoc.,
7 1/2%, 6/15/24 37,639 39
Government National Mortgage Assoc.,
8 1/2%, 8/15/24 262,482 276
Government National Mortgage Assoc.,
8 1/2%, 9/15/24 368,912 387
Government National Mortgage Assoc.,
8 1/2%, 2/15/25 51,224 54
Government National Mortgage Assoc.,
8 1/2%, 12/15/24 594,381 624
Government National Mortgage Assoc.,
8 1/2%, 2/15/25 59,142 62
Government National Mortgage Assoc.,
8 1/2%, 2/15/25 388,127 407
Government National Mortgage Assoc.,
8 1/2%, 2/15/23 150,445 158
Government National Mortgage Assoc.,
8 1/2%, 9/15/22 658,395 691
Government National Mortgage Assoc.,
8 1/2%, 10/15/22 589,478 619
Government National Mortgage Assoc.,
7%, 5/15/23 483,212 490
Government National Mortgage Assoc.,
8 1/2%, 9/15/21 229,888 241
Government National Mortgage Assoc.,
8 1/2%, 7/15/21 195,514 205
Government National Mortgage Assoc.,
8 1/2%, 5/15/22 415,111 436
Government National Mortgage Assoc.,
8 1/2%, 10/15/22 14,085 15
Government National Mortgage Assoc.,
8 1/2%, 9/15/22 690,066 724
Government National Mortgage Assoc.,
8 1/2%, 10/15/22 732,365 769
Government National Mortgage Assoc.,
8 1/2%, 1/15/23 241,106 253
Government National Mortgage Assoc.,
8 1/2%, 2/15/23 191,240 201
Government National Mortgage Assoc.,
8 1/2%, 12/15/22 476,037 500
U.S. Treasury, 7 1/8%, 2/15/23 28,000,000 31,981
U.S. Treasury, 7 1/2%, 11/15/24 8,500,000 10,211
U.S. Treasury, 6 7/8%, 8/15/25 9,000,000 10,153
<CAPTION>
MARKET
VALUE
PAR (000'S)
----------- ----------
<S> <C> <C>
FEDERAL GOVERNMENT AND AGENCIES
(CONTINUED)
U.S. Treasury, 4 3/4%, 8/31/98 $11,250,000 $ 11,113
U.S. Treasury, 7 1/4%, 8/15/04 26,000,000 28,917
U.S. Treasury, 7 3/4%, 11/30/99 30,000,000 32,503
U.S. Treasury, 7 1/2%, 1/31/97 30,000,000 30,722
U.S. Treasury, 7 3/4%, 1/31/00 25,000,000 27,164
----------
Total 271,829
----------
FINANCE COMPANIES (2.9%)
Associates Corp. of North
America, 6 7/8%, 1/15/97 7,800,000 7,911
Associates Corp. of North
America, 7.95%, 2/15/10 5,550,000 6,426
Avco Financial Services Inc.,
5 7/8%, 10/15/97 6,800,000 6,843
Beneficial Corp., 6.86%,
11/19/97 7,800,000 7,978
Beneficial Corp., 9 3/8%,
7/28/97 5,000,000 5,284
Ford Motor Credit Company,
5 5/8%, 3/3/97 9,000,000 9,012
General Motors Acceptance
Corp., 8 3/8%, 5/1/97 3,000,000 3,098
General Motors Acceptance
Corp., 6 5/8%, 10/1/02 12,200,000 12,546
----------
Total 59,098
----------
FOODS (0.2%)
Nabisco Inc., 8%, 1/15/00 3,500,000 3,721
----------
FOREIGN GOVERNMENT BONDS (1.0%)
Province of Manitoba, 7 3/4%,
7/17/16 9,672,000 10,891
Province of Quebec, 7 1/8%,
2/9/24 9,500,000 9,576
----------
Total 20,467
----------
MEDIA (1.8%)
News America Holdings Inc.,
7 1/2%, 3/1/00 6,500,000 6,819
News America Holdings Inc.,
8.45%, 8/1/34 10,000,000 11,622
Tele-Communications, Inc.,
7 3/8%, 2/15/00 8,000,000 8,310
Tele-Communications, Inc.,
7 7/8%, 8/1/13 3,000,000 3,101
Time Warner Entertainment Inc.,
8 7/8%, 10/1/12 1,500,000 1,678
Time Warner Inc., 7 3/4%,
6/15/05 6,300,000 6,569
----------
Total 38,099
----------
MUNICIPAL BONDS (0.1%)
Government Trust Certificates,
8%, 5/15/98 2,696,913 2,765
----------
OFFICE EQUIPMENT (0.3%)
International Business Machines Corp.,
6 3/8%, 11/1/97 7,000,000 7,113
----------
TOBACCO (0.7%)
Philip Morris Companies, Inc.,
9 1/4%, 2/15/00 2,100,000 2,348
Philip Morris Companies, Inc.,
7 1/4%, 1/15/03 3,000,000 3,163
RJR Nabisco Inc., 8 5/8%,
12/1/02 8,000,000 8,298
----------
Total 13,809
----------
</TABLE>
78
<PAGE> 82
NORTHWESTERN MUTUAL SERIES FUND, INC.
BALANCED PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MARKET
VALUE
PAR (000'S)
----------- ----------
<S> <C> <C>
BONDS (CONTINUED)
UTILITY-ELECTRIC (4.8%)
Atlantic City Electric Company,
6 5/8%, 8/1/13 $ 4,000,000 $ 3,901
Cleveland Electric Illuminating
Co., 7 3/8%, 6/1/03 4,000,000 3,782
Dayton Power & Light Company,
8.15%, 1/15/26 5,750,000 6,366
Long Island Lighting Co.,
9 5/8%, 7/1/24 1,500,000 1,537
Long Island Lighting Co., 7%,
3/1/04 10,000,000 9,622
Niagara Mohawk Power Corp.,
5 7/8%, 9/1/02 3,275,000 2,893
Pacific Gas & Electric Co.,
7 1/4%, 3/1/26 9,050,000 9,073
Pacific Gas & Electric Co.,
5 3/8%, 8/1/98 5,000,000 4,949
Pacific Gas & Electric Co.,
6 3/4%, 10/1/23 6,400,000 6,104
PECO Energy Company, 7 1/2%,
1/15/99 4,250,000 4,452
PECO Energy Company, 7 3/4%,
3/1/23 8,850,000 9,258
Public Service Electric & Gas
Co., 6 1/8%, 8/1/02 9,000,000 8,995
Southern California Edison Co.,
7 1/4%, 3/1/26 10,000,000 10,038
Texas Utilities Electric Co.,
7 7/8%, 3/1/23 7,750,000 8,289
UNICOM Corp., 6 1/2%, 4/15/00 10,600,000 10,760
----------
Total 100,019
----------
Total Bonds 693,161
----------
MONEY MARKET INVESTMENTS (15.7%)
CHEMICALS (0.8%)
E.I. du Pont de Nemours & Company,
5.73%, 1/5/96 $16,000,000 $ 15,990
----------
DRUGS (1.0%)
+American Home Products Corp.,
5.73%, 1/19/96 21,400,000 21,335
----------
FEDERAL GOVERNMENT AND AGENCIES (1.5%)
+U.S. Treasury, 5.25%, 5/30/96 6,000,000 5,868
U.S. Treasury, 6 7/8%, 10/31/96 25,000,000 25,328
----------
Total 31,196
----------
<CAPTION>
MARKET
VALUE
PAR (000'S)
----------- ----------
<S> <C> <C>
FINANCE COMPANIES (2.3%)
Cargill Financial Services
Corp., 5.7%, 1/12/96 $22,700,000 $ 22,661
Ford Motor Credit Company,
5.73%, 1/8/96 25,000,000 24,972
----------
Total 47,633
----------
FINANCIAL SERVICES (4.2%)
American General Finance Corp.,
8 7/8%, 3/15/96 6,050,000 6,089
BAT Capital Corporation, 5.72%,
1/18/96 19,805,000 19,749
IBM Credit Corporation, 5.73%,
1/17/96 20,500,000 20,448
+Transamerica Financial Corp.,
5.7%, 1/30/96 15,300,000 15,227
Transamerica Financial Corp.,
8.55%, 6/15/96 10,950,000 11,098
+Xerox Credit Corporation,
5.65%, 2/2/96 14,700,000 14,626
----------
Total 87,237
----------
FOODS (2.2%)
H.J. Heinz Company, 5.75%,
1/16/96 25,000,000 24,940
Nestle Capital Corp., 5.63%,
1/4/96 20,000,000 19,991
----------
Total 44,931
----------
PRINTING & PUBLISHING (2.0%)
+Gannett Company Inc., 5.82%,
1/24/96 21,100,000 21,022
Gannett Company Inc., 5.85%,
1/9/96 20,000,000 19,974
----------
Total 40,996
----------
PROFESSIONAL SERVICES (1.0%)
PHH Corp., 5.76%, 1/10/96 20,700,000 20,670
----------
UTILITY-ELECTRIC (0.0%)
Texas Utilities Electric Co.,
9.39%, 11/21/96 250,000 258
----------
UTILITY-TELEPHONE (0.7%)
+SBC Communications
Incorporated, 5.525%, 1/29/96 15,900,000 15,832
----------
Total Money Market Investments 326,078
----------
Total Investments $2,070,621
==========
</TABLE>
* Non-Income Producing
+ Partially or fully held by the custodian in a segregated account as collateral
for open financial futures contracts. Information regarding open futures
contracts as of December 31, 1995 is summarized below:
<TABLE>
<CAPTION>
UNREALIZED
NUMBER OF EXPIRATION (DEPRECIATION)
ISSUER CONTRACTS DATE (000'S)
- -------------------- --------- ---------- --------------
<S> <C> <C> <C>
S&P 500 Stock Index 246 March 1996 $ (1,258)
</TABLE>
The Accompanying Notes are an Integral Part of the Financial Statements
79
<PAGE> 83
<TABLE>
<S><C>
TO: / / Annuity Services Division - Policy Benefits Department (Individual IRA & Non-Tax [NORTHWESTERN MUTUAL LIFE LOGO]
Qualified/Personal) FAX - 414-299-2632
/ / Employer Product Services Division - Policyowner Services Department (Group Billing-
Corporate, Pension, HR10, TDA & SEP) FAX - 414-299-5123
DEFERRED VARIABLE ANNUITY - TRANSFER OR ALLOCATION CHANGE
1. CONTRACT INFORMATON
Contract No._________________________________Annuitant________________________________________________________
Please Print
2. TRANSFER EXISTING BALANCES
The minimum amount that may be transferred from any investment division is $100 or all of the units in that
division, whichever is less. If you want to transfer the entire division, indicate "ALL." The minimum out
of the Guaranteed Interest Fund is $1,000.+
TRANSFER FROM: TRANSFER TO:
NUMBER OF
ACCUMULATION PERCENT (WHOLE)
INVESTMENT DIVISION DOLLAR AMOUNT UNITS DOLLAR AMOUNT PERCENTS ONLY
1. Select Bond $_____________ ______________ $_____________ _______________%
2. International Equity $_____________ ______________ $_____________ _______________%
3. Money Market $_____________ ______________ $_____________ _______________%
4. Balanced $_____________ ______________ $_____________ _______________%
5. Index 500 Stock $_____________ ______________ $_____________ _______________%
6. Aggressive Growth Stock $_____________ OR ______________ $_____________ OR _______________%
7. High Yield Bond* $_____________ ______________ $_____________ _______________%
8. Growth Stock* $_____________ ______________ $_____________ _______________%
9. Growth and Income Stock* $_____________ ______________ $_____________ _______________%
10. Guaranteed Interest Fund+ $_____________ ____N/A_______ $_____________ _______________%
TOTAL $_____________ ______________ $_____________ ___________100_%
Special Instructions:_________________________________________________________________________________________
______________________________________________________________________________________________________________
3. CHANGE ALLOCATION OF FUTURE INVESTMENTS:
Future investments will continue to be allocated as they were prior to the transfer shown above, unless new
instructions are given below: Please indicate in whole percents only, for a total of 100%.
1. Select Bond _____% 4. Balanced _____% 7. High Yield Bond* _____%
2. International Equity _____% 5. Index 500 Stock _____% 8. Growth Stock* _____%
3. Money Market _____% 6. Aggressive Growth Stock _____% 9. Growth and Income Stock*_____%
10. Guaranteed Interest Fund+____%
*NOT AVAILABLE TO THE FOLLOWING CONTRACTS: JJ SERIES, KK SERIES, LL SERIES "OLD ACCOUNT 1," AND ALL CONTRACTS
ISSUED IN NML SEPARATE ACCOUNT C.
4. EFFECTIVE DATE:
This transfer and/or allocation of future investments shall be effective on ________________ (insert specific date
if desired). If no date is specified, or if this form is not received at NML's Home Office (see address on reverse
side) on or prior to 3:00 p.m. Central time on that date, this transfer shall be effective on the date this form is
received (complete and signed) at NML's Home Office.
5. SIGNATURES OF OWNER(S)/TRUSTEE REQUIRED (TITLE MUST BE INCLUDED):
________________________________________________________________ Date signed_______________________________________
________________________________________________________________ Date signed_______________________________________
Owner's Daytime No. ( )______________________________
FOR AGENT'S USE ONLY
/ / Instructions for this transfer were LINKed on ____________________________ (date).
GA No. ________________ Agent No. _____________________
+ Not available in all states. See back page for Transfer Restrictions. The Guaranteed Interest Fund is not available for
all contracts issued in NML Separate Account C.
(See over for FAX/LINK Instructions)
</TABLE>
<PAGE> 84
HOW TO SUBMIT THIS FORM
FIRST CLASS MAIL
Please mail form to Northwestern Mutual Life, Annuity Services/Employer Product
Services, P. O. Box 2099, Milwaukee, Wisconsin 53202-2099. See Section 4
(other side) for effective date.
FAX
The completed/signed transfer/change of allocation form may be FAXed to the
Home Office at the numbers provided at the top of the form (other side). The
original transfer form is not needed. Please keep for your records. See
Section 4 (other side) for effective date.
LINK
NML Agents only: If timing is critical and FAX equipment is unavailable, the
transfer/change of allocation request may be LINKED to the Home Office. You
MUST have a completed, signed transfer form in your possession. The original
signed transfer form must be received in the Home Office within five (5)
working days from the date of the LINK. The effective date will be the date
that the LINK is received in the Home Office. Be sure to complete the "Agent's
Use Only" box at the bottom of the form.
SIGNATURE INSTRUCTIONS
SIGNATURE BY OWNER
All Owners must sign name as it appears in the policy contract. If the Owner's
name has changed since the policy was issued, he/she should add his/her present
surname to his/her name as it appears in the policy contract.
SIGNATURE BY ASSIGNEE
If the signer of the form is an assignee and the assignee is a bank, savings
and loan association, other financial institution or corporation, an officer
must sign with his/her title. Name of corporate entity must appear above the
signature.
SIGNATURE ON BEHALF OF CORPORATION
If the signer of the form is a corporation, an officer of the corporation must
sign on behalf of the corporation with his/her title. The name of the
corporation must appear above the signature.
SIGNATURE ON BEHALF OF PARTNERSHIP
If the signer of the form is a partnership, the name of the partnership must
appear above the signature. A partner other than the Annuitant must sign.
SIGNATURE ON BEHALF OF TRUST
If the signer of the form is a Trust, the authorized Trustee must sign his/her
name, followed by the word "Trustee." The name of the Trust must appear above
the signature.
+ GUARANTEED INTEREST FUND (GIF) TRANSFERS RESTRICTIONS
TIMING RESTRICTION:
No transfers into or out of the Guaranteed Interest Fund are allowed for a
period of 365 days following a transfer out of the fund.
AMOUNT RESTRICTION:
The maximum amount that may be transferred out of the GIF in any one transfer
is limited to THE GREATER OF:
- 20% of the GIF value on the previous anniversary, and
- amount of the most recent transfer from the Guaranteed Interest Fund.
However, in no event will this maximum transfer amount be less than $1,000 or
greater than $50,000.
