<PAGE>
SEMI-ANNUAL REPORT
- -------------------------------------------
April 30, 1995
NEUBERGER&BERMAN
MUNICIPAL FUNDS-SM-
Neuberger&Berman
MUNICIPAL MONEY FUND
Neuberger&Berman
MUNICIPAL SECURITIES TRUST
Neuberger&Berman
NEW YORK INSURED INTERMEDIATE FUND
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
THE FUNDS
PRESIDENT'S LETTER 4
PERFORMANCE
HIGHLIGHTS 9
RATINGS SUMMARY 10
FINANCIAL STATEMENTS 12
FINANCIAL HIGHLIGHTS 20
PER SHARE DATA
Municipal Money Fund 20
Municipal Securities
Trust 21
New York Insured
Intermediate Fund 22
THE PORTFOLIOS
SCHEDULE OF
INVESTMENTS 25
Municipal Money
Portfolio 25
Municipal Securities
Portfolio 36
New York Insured
Intermediate Portfolio 41
FINANCIAL STATEMENTS 44
FINANCIAL HIGHLIGHTS 51
DIRECTORY 52
OFFICERS AND
TRUSTEES 53
PORTFOLIO MANAGEMENT 54
</TABLE>
3
<PAGE>
PRESIDENT'S LETTER JUNE 20, 1995
Dear Shareholder,
When we last reported to you, in your Fund's October 1994 Annual Report,
interest rates had risen virtually worldwide due to signs of strength. It was
our belief that bonds were an attractive investment opportunity because their
prices were depressed.
Economic expansion has slowed during the six-month period ending April 30,
1995. Many analysts believe the economic environment will remain moderate in the
months ahead.
Recent economic data indicate that the economy expanded at a rate of 2.8% in
the first three months of 1995, as measured by the Gross Domestic Product (GDP).
This increase represents the slowest rate of growth since the summer of 1993.
The widely anticipated slowdown offers further evidence that the economy,
after a 4-year expansion, is braking at a steady rate -- the hoped for
"soft-landing." This current economic situation has been referred to as a
"Goldilocks World," where the porridge is not too hot and not too cold, but just
right. In other words, the current economic growth rate is not too much or too
little -- just about right!
Because of this relatively subdued economic environment, both the taxable and
municipal bond markets increased in value (bond prices increased, yields
decreased) from late November 1994 through April 1995. As you may know, bond
prices respond positively to a low
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
INTEREST RATES
IN PERCENT
30 YR TREASURY 3 MONTH TREASURY 12-22 YRS MUNICIPAL
BONDS BILL INDEX
<S> <C> <C> <C>
11/4/94 8.16 5.32 6.454
11/11/94 8.15 5.38 6.509
11/18/94 8.13 5.48 6.600
11/25/94 7.93 5.44 6.437
12/2/94 7.91 5.80 6.405
12/9/94 7.86 5.83 6.401
12/16/94 7.86 5.71 6.369
12/23/94 7.83 5.69 6.618
12/30/94 7.88 5.70 6.491
1/6/95 7.86 5.92 6.534
1/13/95 7.79 5.70 6.329
1/20/95 7.89 5.91 6.401
1/27/95 7.73 5.92 6.273
2/3/95 7.63 5.96 6.121
2/10/95 7.67 5.98 6.115
2/17/95 7.59 5.87 6.021
2/24/95 7.53 5.89 5.944
3/3/95 7.54 5.91 5.877
3/10/95 7.46 5.95 5.891
3/17/95 7.37 5.92 5.856
3/24/95 7.37 5.85 5.839
3/31/95 7.43 5.89 5.878
4/7/95 7.39 5.87 5.813
4/14/95 7.34 5.76 5.730
4/21/95 7.34 5.79 5.718
4/28/95 7.34 5.88 5.867
</TABLE>
SOURCE: BLOOMBERG FINANCIAL MARKETS -- 30 YEAR TREASURY BOND &
TREASURY BILLS
MERRILL LYNCH 12-22 YEAR MUNICIPAL BOND INDEX
4
<PAGE>
inflationary environment. With inflation at a relatively low rate, real yields
on bonds (the nominal stated bond yield minus the current rate of inflation)
offer an attractive return relative to inflation.
We will continue to monitor the economy, paying particular attention to the
operating rate of industry, home construction, and commodity prices. A
discussion of each Portfolio's investment strategy during the six-month period
covered by this Semi-Annual Report follows. We will continue to make every
effort to merit your confidence.
MUNICIPAL MONEY FUND. Short-term municipal bond rates declined considerably
over the past six months in response to weaker economic data and severe supply
shortages in the tax-exempt fixed income market. Investors continued to seek a
safe haven in high quality money market funds, particularly in the face of the
turbulent market environment of the previous year and the Orange County,
California, crisis that temporarily disrupted the markets at the end of 1994.
The dollar-weighted average portfolio maturity for Municipal Money Fund has
ranged from a high of 63 days to a low of 42.6 days during the period. As of
April 30, 1995, the portfolio maturity stood at 55.5 days. The current and
effective (compounded) yields for the Fund as of April 30, 1995 were 3.70% and
3.77%, respectively. This can be translated into tax-equivalent current and
effective yields of 6.13% and 6.32%, respectively, for an investor in the
highest federal income tax bracket.*
MUNICIPAL SECURITIES TRUST. Out of an environment of market turmoil
investment opportunity arose as municipal bond returns increased over the last 6
months. The Orange County, California, debacle highlighted the importance of
examining investment guidelines for state and local authorities and further
depressed the tax-exempt market at year end 1994. However, those investors who
maintained their Municipal Securities Trust holdings into 1995 were rewarded
with strong performance results for this reporting period. Economic weakness
slowed the Federal Reserve Board's rate moves and the supply of new municipal
securities dwindled by almost 50% from the previous year.
Our investment strategy in this environment had been to shorten the
portfolio's dollar-weighted average maturity from 7.8 years to 7.1 years over
the last six months, and to purchase discount bonds which were trading at
bargain prices. Currently, we continue to focus on high
5
<PAGE>
quality issues, but have scaled back the dollar-weighted average portfolio
maturity to 7.1 years, as of April 30, 1995. While we believe the market
environment is still positive for municipal income investments, concerns that
Congress may adopt a flat-rate income tax may dampen the gains in the municipal
market to date. We view any significant corrections in the market as a buying
opportunity, since we believe low supply will continue to be a positive
technical factor. Moreover, we think that the likelihood of the passage of a
flat tax will become quite remote once details, such as the elimination of home
mortgage deductions and higher borrowing costs for municipal authorities, are
made clear.
NEW YORK INSURED INTERMEDIATE FUND. When New York Insured Intermediate Fund
was established in February 1994, the goal was to provide high current income
exempt from Federal income tax and New York State and New York City personal
income taxes, primarily through a Portfolio of insured securities with high
credit quality. Last year proved to be one of the most difficult for municipal
bond funds, as interest rates rose dramatically and liquidity problems developed
in the marketplace. However, it was the Orange County, California, bankruptcy
that highlighted the importance and effectiveness of insurance in ensuring
liquidity and capital preservation.
6
<PAGE>
Throughout the first four months of 1995, we have kept the dollar-weighted
average portfolio maturity within a range from a high of 8.4 years to a low of
6.7 years, and closed the period at 8.3 years, as of April 30, 1995. This
strategy was implemented in anticipation of a dramatic reduction in the issuance
of high grade New York bonds and of increased investor demand for the added
security of an enhanced product. Our policy has produced favorable results
during this reporting period and we expect to maintain this investment approach
in the current market environment.
Sincerely,
/s/ Theresa A. Havell
Theresa A. Havell
President and Trustee
Neuberger&Berman Income Funds
*Tax-equivalent yield is the taxable yield that an investor would have had to
receive in order to realize the same level of yield after federal taxes at the
highest federal tax rate, 39.6%, assuming that all of the Fund's income is
exempt from federal income taxes. There is no assurance that Municipal Money
Fund will be able to maintain a stable net asset value of $1.00 per share. The
value of the Fund's shares, like the share values of all other mutual funds, is
neither insured nor guaranteed by the U.S. Government. The return on an
investment in Municipal Money Fund will fluctuate. Results represent past
performance and do not indicate future results.
7
<PAGE>
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8
<PAGE>
PERFORMANCE HIGHLIGHTS
<TABLE>
<CAPTION>
TOTAL RETURN ILLUSTRATION FOR PERIODS
ENDED 4/30/95
-------------------------------------
SIX
MONTH AVERAGE ANNUAL TOTAL
PERIOD RETURNS(1)
NEUBERGER&BERMAN INCEPTION ENDED SINCE
INCOME FUNDS DATE 4/30/95 1 YR 5 YR INCEPTION
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MUNICIPAL SECURITIES TRUST* 7/9/87 +4.97% +4.66% +6.62% +6.46%
NEW YORK INSURED INTERMEDIATE
FUND* 2/1/94 +6.58% +5.65% N/A +1.32%
</TABLE>
<TABLE>
<CAPTION>
YIELD ILLUSTRATION
FOR 7 DAYS ENDED 4/30/95
TAX-EQUIVALENT
INCEPTION DATE CURRENT YIELD(2) EFFECTIVE YIELD(2) EFFECTIVE YIELD**
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MUNICIPAL MONEY FUND* 12/10/84 3.70% 3.77% 6.32%
</TABLE>
1) Average annual total returns for periods ended April 30, 1995. Includes
reinvestment of all dividends and capital gain distributions. The
Neuberger&Berman Income Funds (except New York Insured Intermediate Fund)
were reorganized in July, 1993. Performance and information for periods
prior to July, 1993 refer to the predecessors of the Funds. Results
represent past performance and do not guarantee future results. Investment
returns and principal may fluctuate and shares when redeemed may be worth
more or less than original cost.
2) "Current Yield" refers to the income generated by an investment in the Fund
over a 7-day period. This income is then "annualized." The "effective yield"
is calculated similarly but, when annualized, the income earned by an
investment in the Fund is assumed to be reinvested. The "effective yield"
will be slightly higher than the "current yield" because of the compounding
effect of this assumed reinvestment. Yields of a money market fund will
fluctuate and past performance is no guarantee of future results.
* Neuberger&Berman Management Inc. voluntarily bears certain operating expenses
in excess of .65% of the average daily net assets per annum of Municipal
Securities Trust and New York Insured Intermediate Fund (.50% for Municipal
Securities Trust prior to February 22, 1993). These arrangements can be
terminated upon 60 days' prior written notice for Municipal Securities Trust
and after February 29, 1996 for New York Insured Intermediate Fund. Absent
such reimbursements, the total returns for the above stated periods would
have been +4.80%, +4.42%, +6.03%, and +5.07%, respectively, for Municipal
Securities Trust and +6.06%, +4.75%, and +.33%, respectively, for New York
Insured Intermediate Fund.
There is no assurance that Municipal Money Fund will be able to maintain a
stable net asset value of $1.00 per share. The value of the Fund's shares,
like the value of shares of all other mutual funds, is neither insured nor
guaranteed by the U.S. Government. The return on an investment in Municipal
Money Fund will fluctuate.
** Tax-equivalent effective yield is the taxable effective yield that an
investor would have had to receive in order to realize the same level of
yield after federal taxes at 39.6%, assuming that all of the Fund's income is
exempt from Federal income taxes.
9
<PAGE>
RATINGS SUMMARY
<TABLE>
<CAPTION>
DOLLAR-WEIGHTED
PERCENT OF TOTAL AVERAGE PORTFOLIO
NEUBERGER&BERMAN MOODY'S RATINGS INVESTMENTS MATURITY
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Municipal Money Portfolio Aaa 4.3% 55.5 days
Aa .7
P-1 24.3
MIG-1/VMIG-1 52.7
N/R 18.0
-----
100.0%
Municipal Securities Portfolio Aaa 44.3% 7.1 years
Aa, Aa1 38.2
A, A1 11.9
P-1 1.3
MIG-1/VMIG-1 2.1
N/R 2.2
-----
100.0%
New York Insured Intermediate Portfolio Aaa 80.3% 8.3 years
Baa1 17.7
VMIG-1 2.0
-----
100.0%
</TABLE>
MOODY'S INVESTORS SERVICE, INC. (MOODY'S) CORPORATE BOND RATINGS:
AAA - Bonds rated AAA are judged to be of the best quality. They carry the
smallest degree of investment risk and are generally referred to as "gilt edge."
Interest payments are protected by a large or exceptionally stable margin, and
principal is secure. Although the various protective elements are likely to
change, the changes that can be visualized are most unlikely to impair the
fundamentally strong position of the issue.
AA - Bonds rated AA are judged to be of high quality by all standards. Together
with the AAA group, they comprise what are generally known as "high-grade
bonds." They are rated lower than the best bonds because margins of protection
may not be as large as in AAA-rated securities, fluctuation of protective
elements may be of greater amplitude, or there may be other elements present
that make the long-term risks appear somewhat larger than in AAA-rated
securities.
A - Bonds rated A possess many favorable investment attributes and are
considered as upper-medium grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present that
suggest a susceptibility to impairment some time in the future.
BAA - Bonds rated BAA are considered medium-grade obligations (i.e. they are
neither highly protected nor poorly secured). Interest payments and principal
security appear adequate for the present, but certain protective elements may be
lacking or may be characteristically unreliable over any great length of time.
These bonds lack outstanding investment characteristics and in fact have
speculative characteristics as well.
MOODY'S SHORT-TERM DEBT RATINGS:
Issuers rated PRIME-1 (P-1), or related supporting institutions, have a superior
capacity for repayment of short-term promissory obligations. PRIME-1 repayment
capacity will normally be evidenced by the following characteristics: leading
market positions in well-established industries; high rates of return on funds
employed; conservative capitalization structures with moderate reliance on debt
and ample asset protection; broad margins in earnings coverage of fixed
financial charges and high internal cash generation; and well-established access
to a range of financial markets and assured sources of alternative liquidity.
MOODY'S SHORT-TERM LOAN RATINGS:
ISSUERS RATED MIG-1/VMIG-1 - This designation denotes best quality. There is
present strong protection by established cash flows, superior liquidity support
or demonstrated broad-based access to the market for refinancing.
N/R - Not rated by Moody's.
NOTE: Moody's applies numerical modifiers, 1, 2, and 3, in each generic rating
classification from Aa through Baa in its corporate bond ratings system. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3 indicates that the issue ranks in the lower end of its generic rating
category.
10
<PAGE>
(This page has been left blank intentionally.)
11
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
Neuberger&Berman April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Income Funds
<TABLE>
<CAPTION>
NEW YORK
MUNICIPAL INSURED
MUNICIPAL SECURITIES INTERMEDIATE
(000'S OMITTED EXCEPT PER SHARE AMOUNTS) MONEY FUND TRUST FUND
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio, at value (Note
A) $139,676 $ 43,724 $ 10,499
Deferred organization costs (Note A) -- -- 30
Receivable for Trust shares sold 6 -- 2
Receivable from administrator -- net (Note B) -- 4 13
-------------------------------------------
139,682 43,728 10,544
-------------------------------------------
LIABILITIES
Dividends payable 3 55 22
Payable for Trust shares redeemed 214 15 129
Payable to administrator (Note B) 30 -- --
Accrued expenses 34 28 26
-------------------------------------------
281 98 177
-------------------------------------------
NET ASSETS at value $139,401 $ 43,630 $ 10,367
-------------------------------------------
NET ASSETS consist of:
Par value $ 140 $ 4 $ 1
Paid-in capital in excess of par value 139,362 45,123 11,049
Accumulated net realized losses on investment (101) (876) (331)
Net unrealized depreciation in value of investment -- (621) (352)
-------------------------------------------
NET ASSETS at value $139,401 $ 43,630 $ 10,367
-------------------------------------------
SHARES OUTSTANDING
($.001 par value; unlimited shares authorized) 139,502 4,144 1,074
-------------------------------------------
NET ASSET VALUE, offering and redemption price per share $1.00 $10.53 $9.65
-------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE>
STATEMENTS OF OPERATIONS
Neuberger&Berman For the Six Months Ended April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Income Funds
<TABLE>
<CAPTION>
NEW YORK
MUNICIPAL MUNICIPAL INSURED
MONEY SECURITIES INTERMEDIATE
(000'S OMITTED) FUND TRUST FUND
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME
Investment income from corresponding Portfolio
(Note A) $ 3,018 $ 1,142 $ 307
-------------------------------------------
Expenses:
Administration fee (Note B) 193 54 15
Amortization of deferred organization and
initial offering expenses (Note A) -- -- 4
Auditing fees 4 4 2
Custodian fees 5 5 5
Legal fees 1 2 7
Registration and filing fees 8 13 --
Service fees (Note B) 15 4 1
Shareholder reports 8 11 15
Shareholder servicing agent fees 14 14 2
Trustees' fees and expenses 10 4 3
Miscellaneous 1 2 1
Expenses from corresponding Portfolio (Note
A) 281 101 46
-------------------------------------------
Total expenses 540 214 101
Deduct -- expenses reimbursed by
administrator (Note B) -- (72) (61)
-------------------------------------------
Total net expenses 540 142 40
-------------------------------------------
Net investment income 2,478 1,000 267
-------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FINANCIAL FUTURES CONTRACTS FROM CORRESPONDING
PORTFOLIO (NOTE A)
Net realized loss on investments (25) (378) (80)
Net realized loss on financial futures
contracts -- (65) --
Change in net unrealized depreciation of
investments -- 1,433 538
Net unrealized depreciation of financial
futures contracts -- (26) --
-------------------------------------------
Net gain (loss) on investments and
financial futures contracts from
corresponding Portfolio (Note A) (25) 964 458
-------------------------------------------
Net increase in net assets resulting from
operations $ 2,453 $ 1,964 $ 725
-------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
Neuberger&Berman
- ----------------------------------------------------------------------
Income Funds
<TABLE>
<CAPTION>
MUNICIPAL
MONEY
FUND
Six Months
Ended April Year
30, Ended
1995 October 31,
(000'S OMITTED) (UNAUDITED) 1994
- -------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 2,478 $ 3,332
Net realized gain (loss) on
investments sold and financial
futures contracts from
corresponding Portfolio (Note A) (25) 5
Change in net unrealized
appreciation (depreciation) of
investments and financial futures
contracts from corresponding
Portfolio (Note A) -- --
-------------------------------
Net increase (decrease) in net
assets resulting from operations 2,453 3,337
-------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (2,478) (3,332)
Net realized gain on investments -- --
Excess of net realized gain on
investments -- --
-------------------------------
Total distributions to shareholders (2,478) (3,332)
-------------------------------
FROM TRUST SHARE TRANSACTIONS:
Proceeds from shares sold 97,973 192,425
Proceeds from reinvestment of
dividends and distributions 2,457 3,312
Payments for shares redeemed (111,305) (227,037)
-------------------------------
Net increase (decrease) from Trust
share transactions (10,875) (31,300)
-------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (10,900) (31,295)
NET ASSETS:
Beginning of period 150,301 181,596
-------------------------------
End of period $ 139,401 $ 150,301
-------------------------------
NUMBER OF TRUST SHARES:
Sold 97,973 192,425
Issued on reinvestment of dividends
and distributions 2,457 3,312
Redeemed (111,305) (227,037)
-------------------------------
Net increase (decrease) in shares
outstanding (10,875) (31,300)
-------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
14
<PAGE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MUNICIPAL NEW YORK
SECURITIES INSURED INTERMEDIATE
TRUST FUND
Six Months Six Months Period from February
Ended Year Ended 1, 1994 (Commencement
April 30, Ended April 30, of Operations) to
1995 October 31, 1995 October 31,
(OOO'S OMITTED) (UNAUDITED) 1994 (UNAUDITED) 1994
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 1,000 $ 3,452 $ 267 $ 465
Net realized gain (loss) on
investments sold and financial
futures contracts from
corresponding Portfolio (Note A) (443) (433) (80) (251)
Change in net unrealized
appreciation (depreciation) of
investments and financial futures
contracts from corresponding
Portfolio (Note A) 1,407 (4,761) 538 (890)
---------------------------------------------------------------------------------------
Net increase (decrease) in net
assets resulting from operations 1,964 (1,742) 725 (676)
---------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (1,000) (3,452) (267) (465)
Net realized gain on investments -- (1,152) -- --
Excess of net realized gain on
investments -- (93) -- --
---------------------------------------------------------------------------------------
Total distributions to shareholders (1,000) (4,697) (267) (465)
---------------------------------------------------------------------------------------
FROM TRUST SHARE TRANSACTIONS:
Proceeds from shares sold 7,313 61,454 2,130 23,595
Proceeds from reinvestment of
dividends and distributions 596 1,701 84 76
Payments for shares redeemed (16,356) (110,849) (7,031) (7,804)
---------------------------------------------------------------------------------------
Net increase (decrease) from Trust
share transactions (8,447) (47,694) (4,817) 15,867
---------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (7,483) (54,133) (4,359) 14,726
NET ASSETS:
Beginning of period 51,113 105,246 14,726 --
---------------------------------------------------------------------------------------
End of period $ 43,630 $ 51,113 $ 10,367 $ 14,726
---------------------------------------------------------------------------------------
NUMBER OF TRUST SHARES:
Sold 708 5,677 229 2,401
Issued on reinvestment of dividends
and distributions 58 158 9 8
Redeemed (1,606) (10,320) (756) (817)
---------------------------------------------------------------------------------------
Net increase (decrease) in shares
outstanding (840) (4,485) (518) 1,592
---------------------------------------------------------------------------------------
</TABLE>
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Neuberger&Berman April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Income Funds
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman Municipal Money Fund ("Municipal Money"),
Neuberger&Berman Municipal Securities Trust ("Municipal Securities Trust"),
and Neuberger&Berman New York Insured Intermediate Fund ("New York Insured
Intermediate") (collectively, the "Funds") are separate series of
Neuberger&Berman Income Funds (the "Trust"), a Delaware business trust
organized pursuant to a Trust Instrument dated December 23, 1992. The Trust
is registered as an open-end management investment company under the
Investment Company Act of 1940 (the "1940 Act") and its shares are registered
under the Securities Act of 1933, as amended (the "1933 Act"). New York
Insured Intermediate had no operations until February 1, 1994 other than
matters relating to its organization and registration as an open-end
management investment company under the 1940 Act, and registration of its
shares under the 1933 Act and state law. The trustees of the Trust may
establish additional series or classes of shares without the approval of
shareholders.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series, and no other.
Each Fund seeks to achieve its investment objective by investing all of
its net investable assets in its corresponding Portfolio of Income Managers
Trust (the "Portfolio") having the same investment objective and policies as
the Fund. The value of each Fund's investment in its corresponding Portfolio
reflects that Fund's proportionate interest in the net assets of that
Portfolio (100% for each Fund at April 30, 1995). The performance of each
Fund is directly affected by the performance of its corresponding Portfolio.
The financial statements of each Portfolio, including the schedule of
investments, are included elsewhere in this report and should be read in
conjunction with each Fund's financial statements.
It is the policy of Municipal Money to maintain a continuous net asset
value per share of $1.00; the Fund has adopted certain investment, valuation,
and dividend and distribution policies, which conform to general industry
practice, to enable it to do so. However, there is no assurance the Fund will
be able to maintain a stable net asset value per share.
2) PORTFOLIO VALUATION: Investments in each Portfolio of Income Managers Trust
are valued by Income Managers Trust as indicated in the notes following the
Portfolios' schedule of investments.
16
<PAGE>
3) FEDERAL INCOME TAXES: Each series of the Trust is treated as a separate
entity for Federal income tax purposes. It is the policy of each Fund of the
Trust to continue to qualify as a regulated investment company by complying
with the provisions available to certain investment companies, as defined in
applicable sections of the Internal Revenue Code, and to make distributions
of taxable income (after reduction for any amounts available for Federal
income tax purposes as capital loss carryforwards) sufficient to relieve it
from all, or substantially all, Federal income taxes. Accordingly, each Fund
paid no Federal income taxes and no provision for Federal income taxes was
required.
4) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Each Fund earns income, net of
Portfolio expenses, daily on its investment in its corresponding Portfolio.
It is the policy of each Fund to declare dividends from net investment income
on each business day; such dividends are paid monthly. Distributions from net
realized capital gains, if any, will be declared and paid annually after the
end of the fiscal year. To the extent that each Fund's net realized capital
gains, if any, can be offset by capital loss carryforwards ($75,365 expiring
in 1997 for Municipal Money, $433,301 expiring in 2002 for Municipal
Securities Trust, and $240,090 expiring in 2002 for New York Insured
Intermediate, determined as of October 31, 1994), it is the policy of each
Fund not to distribute such gains.
Each Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains.
5) ORGANIZATION EXPENSES: Expenses incurred by New York Insured Intermediate in
connection with its organization are being amortized on a straight-line basis
over a five-year period. At April 30, 1995, the unamortized balance of such
expenses amounted to $29,935.
6) EXPENSE ALLOCATION: The Funds bear all costs of operations. Expenses incurred
with respect to any two or more Funds are allocated in proportion to the net
assets of such Funds, except where another more appropriate allocation of
expenses to each Fund can otherwise be made fairly. Expenses directly
attributable to a Fund are charged to that Fund.
7) OTHER: All net investment income and realized and unrealized capital gains
and losses of each Portfolio are allocated pro rata among its respective
Funds and any other investors in the Portfolio.
NOTE B -- ADMINISTRATION AND DISTRIBUTION FEES AND OTHER TRANSACTIONS
WITH AFFILIATES:
Each Fund retains Neuberger&Berman Management Incorporated ("Management") as
its administrator under an Administration Agreement ("Agreement") dated
17
<PAGE>
as of July 2, 1993, and February 1, 1994 (with respect to New York Insured
Intermediate). Pursuant to this Agreement each Fund pays Management an
administration fee at the annual rate of .25% of that Fund's average daily net
assets. The Agreement provides that if with respect to any fiscal year of each
Fund, its total operating expenses plus its pro rata portion of its
corresponding Portfolio's operating expenses (including the fees payable to
Management but excluding interest, taxes, brokerage commissions, and
extraordinary expenses) ("Operating Expenses") exceed the most restrictive of
the expense limitations imposed by securities laws of the states in which such
Fund's shares are qualified for sale, the administration fees for that fiscal
year will be reduced by the amount of such excess, provided that Management has
no obligation to reimburse the Fund for any such expenses that exceed the
administration fee. The most restrictive expense limitation to which Municipal
Money and Municipal Securities Trust are currently subject is 2 1/2% of the
first $30 million of average daily net assets, 2% of the next $70 million of
average daily net assets, and 1 1/2% of any additional average daily net assets.
No reduction in the administration fee as a result of the state expense
limitation was required for the six months ended April 30, 1995.
In addition, Management has voluntarily undertaken to reimburse Municipal
Securities Trust and New York Insured Intermediate for their Operating Expenses
which exceed, in the aggregate, .65% per annum of their average daily net assets
(the "Expense Limitation"). This undertaking is subject to termination by
Management upon at least sixty (60) days' prior written notice for Municipal
Securities Trust, and after February 29, 1996 for New York Insured Intermediate.
For the six months ended April 30, 1995, such excess expenses amounted to
$72,354 and $61,277 for Municipal Securities Trust and New York Insured
Intermediate, respectively. New York Insured Intermediate has agreed to repay
Management through October 31, 1998, for its excess Operating Expenses
previously reimbursed by Management, so long as its annual Operating Expenses
during that period do not exceed the Expense Limitation.
All of the capital stock of Management is owned by individuals who are also
general partners of Neuberger&Berman, L.P. ("Neuberger"), a member firm of The
New York Stock Exchange and the sub-adviser to each Portfolio. Several
individuals who are officers and/or trustees of the Trust are also partners of
Neuberger and/or officers and/or directors of Management.
Under a service agreement, each Fund retained Management to provide certain
shareholder, shareholder-related and other services not furnished by the
shareholder servicing agent. Pursuant to the service agreement each Fund paid
Management a monthly fee at the annual rate of .02% of the average daily net
assets of the Fund as compensation for such services. For the six months ended
April 30, 1995, Municipal Money, Municipal Securities Trust, and New York
Insured Intermediate accrued $15,415, $4,328, and $1,215, respectively, for such
services.
18
<PAGE>
The trustees of the Trust approved, effective as of May 1, 1995, the
substitution of the current Agreement and service agreement between Management
and the Trust on behalf of each Fund with a new Administration Agreement
combining the provisions of both current agreements, resulting in an
administration fee of .27% per annum of each Fund's average daily net assets.
Each Fund also has a distribution agreement with Management, which receives
no compensation therefor and no commissions for sales or redemptions of shares
of beneficial interest of each Fund.
NOTE C -- INVESTMENT TRANSACTIONS:
During the six months ended April 30, 1995, additions and reductions in each
Fund's investment in its corresponding Portfolio were as follows:
<TABLE>
<CAPTION>
ADDITIONS REDUCTIONS
- -----------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL MONEY $86,893,658 $100,391,978
MUNICIPAL SECURITIES TRUST 5,424,725 15,068,181
NEW YORK INSURED INTERMEDIATE 1,819,007 6,799,405
</TABLE>
NOTE D -- UNAUDITED FINANCIAL INFORMATION:
The financial information included in this interim report is taken from the
records of each Fund without audit by independent auditors. Annual reports
contain audited financial statements.
19
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Money Fund
The following table includes selected data for a share outstanding
throughout each period and other performance information derived from the
Financial Statements. It should be read in conjunction with its corresponding
Portfolio's Financial Statements and notes thereto.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1995 YEAR ENDED OCTOBER 31,
(UNAUDITED)(1) 1994(1) 1993(1) 1992 1991 1990
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ .9995 $ .9996 $ .9995 $ .9989 $ .9989 $ .9989
------------------------------------------------------------------------
Income From Investment Operations
Net Investment Income .0160 .0204 .0184 .0263 .0432 .0539
Net Gains or Losses on Securities (.0002) (.0001) .0001 .0006 -- --
------------------------------------------------------------------------
Total From Investment Operations .0158 .0203 .0185 .0269 .0432 .0539
------------------------------------------------------------------------
Less Distributions
Dividends (from net investment
income) (.0160) (.0204) (.0184) (.0263) (.0432) (.0539)
------------------------------------------------------------------------
Net Asset Value, End of Period $ .9993 $ .9995 $ .9996 $ .9995 $ .9989 $ .9989
------------------------------------------------------------------------
Total Return+ +1.61%(2) +2.06% +1.86% +2.66% +4.40% +5.53%
------------------------------------------------------------------------
Ratios/Supplemental Data
Net Assets, End of Period (in
millions) $ 139.4 $ 150.3 $ 181.6 $ 195.6 $ 173.9 $ 190.6
------------------------------------------------------------------------
Ratio of Expenses to Average Net
Assets .70%(3) .73% .74% .67% .66% .67%
------------------------------------------------------------------------
Ratio of Net Investment Income to
Average Net Assets 3.22%(3) 2.02% 1.85% 2.63% 4.34% 5.41%
------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
20
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Securities Trust
The following table includes selected data for a share outstanding
throughout each period and other performance information derived from the
Financial Statements. It should be read in conjunction with its corresponding
Portfolio's Financial Statements and notes thereto.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1995 YEAR ENDED OCTOBER 31,
(UNAUDITED) (1) 1994(1) 1993(1) 1992 1991 1990
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 10.26 $ 11.12 $ 10.53 $ 10.39 $ 10.14 $ 10.09
---------------------------------------------------------------------------
Income From Investment Operations
Net Investment Income .23 .46 .48 .54 .58 .64
Net Gains or Losses on Securities
(both realized and unrealized) .27 (.73) .68 .14 .25 .05
---------------------------------------------------------------------------
Total From Investment Operations .50 (.27) 1.16 .68 .83 .69
---------------------------------------------------------------------------
Less Distributions
Dividends (from net investment
income) (.23) (.46) (.48) (.54) (.58) (.64)
Distributions (from capital gains) -- (.12) (.09) -- -- --
Distributions (in excess of capital
gains) -- (.01) -- -- -- --
---------------------------------------------------------------------------
Total Distributions (.23) (.59) (.57) (.54) (.58) (.64)
---------------------------------------------------------------------------
Net Asset Value, End of Period $ 10.53 $ 10.26 $ 11.12 $ 10.53 $ 10.39 $ 10.14
---------------------------------------------------------------------------
Total Return+ +4.97%(2) -2.57% +11.30% +6.72% +8.41% +6.99%
---------------------------------------------------------------------------
Ratios/Supplemental Data
Net Assets, End of Period (in
millions) $ 43.6 $ 51.1 $ 105.2 $ 37.0 $ 25.5 $ 14.1
---------------------------------------------------------------------------
Ratio of Expenses to Average Net
Assets(4) .65%(3) .65% %.62 .50% .50% .50%
---------------------------------------------------------------------------
Ratio of Net Investment Income to
Average Net Assets(4) 4.62%(3) 4.24% 4.33% 5.16% 5.61% 6.28%
---------------------------------------------------------------------------
Portfolio Turnover Rate(5) -- -- % 35 46% 10% 42%
---------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
21
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
New York Insured Intermediate Fund
The following table includes selected data for a share outstanding
throughout each period and other performance information derived from the
Financial Statements. The per share amounts and ratios which are shown reflect
income and expenses, including the Fund's proportionate share of its
corresponding Portfolio's income and expenses. It should be read in
conjunction with its corresponding Portfolio's Financial Statements and notes
thereto.
<TABLE>
<CAPTION>
SIX MONTHS ENDED PERIOD FROM
APRIL 30, 1995 FEBRUARY 1, 1994(6)
(UNAUDITED) TO OCTOBER 31, 1994
- -----------------------------------------------------------------------------------------------
<S> <C> <C>
Net Asset Value, Beginning of Period $ 9.25 $ 10.00
-----------------------------------------
Income From Investment Operations
Net Investment Income .20 .29
Net Gains or Losses on Securities (both
realized and unrealized) .40 (.75)
-----------------------------------------
Total From Investment Operations .60 (.46)
-----------------------------------------
Less Distributions
Dividends (from net investment income) (.20) (.29)
-----------------------------------------
Net Asset Value, End of Period $ 9.65 $ 9.25
-----------------------------------------
Total Return+ +6.58%(2) -4.63%(2)
-----------------------------------------
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $ 10.4 $ 14.7
-----------------------------------------
Ratio of Expenses to Average Net Assets(4) .66%(3) .65%(3)
-----------------------------------------
Ratio of Net Investment Income to Average Net
Assets(4) 4.39%(3) 4.10%(3)
-----------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
22
<PAGE>
NOTES TO FINANCIAL HIGHLIGHTS
Neuberger&Berman April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Income Funds
1) The per share amounts and ratios which are shown reflect income and expenses,
including each Fund's proportionate share of its corresponding Portfolio's
income and expenses.
2) Not annualized.
3) Annualized.
4) After reimbursement of expenses by the administrator as described in Note B
of Notes to Financial Statements. Had the administrator not undertaken such
action the annualized ratios to average net assets would have been:
<TABLE>
<CAPTION>
MUNICIPAL SECURITIES TRUST
SIX MONTHS ENDED
APRIL 30, 1995 YEAR ENDED OCTOBER 31,
(UNAUDITED) 1994 1993 1992 1991 1990
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Expenses .99% .82% 1.04% 1.16% 1.38% 1.67%
Net Investment Income 4.28% 4.07% 3.91% 4.50% 4.73% 5.11%
</TABLE>
<TABLE>
<CAPTION>
NEW YORK INSURED INTERMEDIATE
SIX MONTHS ENDED PERIOD FROM
APRIL 30, 1995 FEBRUARY 1, 1994 TO
(UNAUDITED) OCTOBER 31, 1994
- --------------------------------------------------------------------------------
<S> <C> <C>
Expenses 1.67% 1.53%
Net Investment Income 3.38% 3.22%
</TABLE>
5) The Fund transferred all of its investment securities into Neuberger&Berman
Municipal Securities Portfolio on July 2, 1993. After that date the Fund
invested only in Neuberger&Berman Municipal Securities Portfolio and that
Portfolio, rather than the Fund, engaged in securities transactions.
Therefore, after that date the Fund had no portfolio turnover rate. Portfolio
turnover rates for periods ending after July 2, 1993 are included in
Neuberger&Berman Municipal Securities Portfolio's Financial Highlights,
presented elsewhere in this report.
6) The date investment operations commenced.
+ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of each Fund during each
period and assumes dividends and capital gain distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. For Municipal
Securities Trust and New York Insured Intermediate, total return would have
been lower if Management had not reimbursed certain expenses.
23
<PAGE>
(This page has been left blank intentionally.)
24
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Municipal Money Portfolio
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
TAX-EXEMPT SECURITIES -- PRE-REFUNDED BACKED BY
U.S. GOVERNMENT SECURITIES (4.4%)
$ 2,000 Dallas (TX) Wtr. & Swr. Sys. Rev., Ser. 1985,
8.30%, due 10/1/99 P/R 10/1/95 AA $ 2,029
1,000 Orlando (FL) Util. Comm. Wtr. & Elec. Ref. Rev.,
Ser. 1985, 8.625%, due 10/1/05 P/R 10/1/95 Aaa AAA 1,037
2,000 Palm Beach Co. (FL) Solid Waste Au. Imp. Ref.
Rev., Ser. 1985, 10.00%, due 12/1/05 P/R 12/1/95 Aaa 2,103
1,000 Tacoma (WA) Elec. Sys. Ref. Rev. (Dept. of Pub.
Util., Light Div.), Ser. 1985, 9.375%, due 1/1/15
P/R 1/1/96 Aaa A+ 1,048
--------
6,217
--------
MUNICIPAL NOTES (12.3%)
1,100 Wisconsin Operating Notes, Ser. 1994, 4.50%, due
6/15/95 MIG-1 SP-1+ 1,101
1,000 Colorado Gen. Fund TRANS, Ser. 1994, 4.50%, due
6/27/95 MIG-1 1,001
2,500 Pennsylvania TANS, Ser. 1994, 4.75%, due 6/30/95 MIG-1 SP-1+ 2,503
3,000 Texas TRANS, 5.00%, due 8/31/95 MIG-1 SP-1+ 3,008
2,000 Palm Beach Co. (FL) Sch. Dist. TANS, Ser. 1994,
4.75%, due 9/13/95 MIG-1 2,005
1,000 Dekalb Co. (GA) TANS, 5.00%, due 12/29/95 MIG-1 SP-1+ 1,005
2,000 Milwaukee (WI) RANS, Ser. A, 5.50%, due 2/22/96 MIG-1 SP-1+ 2,012
1,000 Summit Co. (OH) BANS, Ser. A, 5.00%, due 3/7/96 MIG-1 SP-1 1,003
1,000 University of Cincinnati (OH) BANS, Ser. K-1,
5.00%, due 3/21/96 MIG-1 SP-1+ 1,003
1,500 Dane Co. (WI) Notes, Ser. A, 5.75%, due 5/1/96 Aaa 1,520
</TABLE>
25
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- ----------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
$ 1,000 Michigan Muni. Board Au. Rev. Notes, Ser. A,
5.00%, due 5/3/96 SP-1+ $ 1,007
--------
17,168
--------
TAX-EXEMPT SECURITIES -- BACKED BY LETTERS OF
CREDIT (2.1%)
BARCLAYS BANK INT'L., LTD.
2,000 Ohio Air Quality Dev. Au. PCR (Ohio Edison Co.
Proj.), Ser. 1988 C, 4.25%, due 9/1/18 Putable
9/1/95 P-1 A-1+ 2,000
STUDENT LOAN MARKETING ASSOC.
1,000 Brazos (TX) Higher Ed. Au., Inc. Std. Loan Rev.,
Ser. 1993 B-1, 3.80%, due 6/1/23 Putable 6/1/95 VMIG-1 1,000
--------
3,000
--------
TAX-EXEMPT SECURITIES -- OTHER (5.1%)
300 Connecticut HFA Hsg. Mtg. Fin., Ser. D-2, 3.65%,
due 11/15/19 Putable 5/15/95 VMIG-1 AA 300
2,500 Iowa Sch. Corp. Warrant Cert. (Cash Anticipation
Prog.), Ser. 1994 A, 4.25%, due 7/17/95 MIG-1 SP-1+ 2,503
1,000 Maryland CDA Single-Family Prog., Ninth Ser.,
5.375%, due 4/1/19 Putable 11/29/95 VMIG-1 1,000
1,000 Metropolitan Gov't. of Nashville & Davidson Co.
(TN) Elec. Rev., Ser. A, 6.80%, due 7/1/95 Aa AA 1,004
1,750 Minneapolis (MN) G.O. Tax Anticipation Cert.
(Spec. Sch. Dist. #1, Minnesota Sch. Dist. Credit
Enhancement Prog.), Ser. 1995, 5.75%, due 1/25/96 MIG-1 SP-1+ 1,758
500 St. Paul (MN) Tax Anticipation Cert. (Independent
Sch. Dist. #625), Ser. A, 5.375%, due 3/28/96 MIG-1 505
--------
7,070
--------
</TABLE>
26
<PAGE>
April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
TAX-EXEMPT CASH EQUIVALENT SECURITIES (14.8%)
$ 2,000 Becker (MN) PCR (Northern States Pwr. Co. --
Sherburne Co. Generating Sta. Unit #3 Proj.), Ser.
1993 A, 4.15%, TECP due 8/11/95 VMIG-1 A-1+ $ 2,000
1,100 Butler Co. (KS) Solid Waste Disp. Fac. Rev.
(Texaco Refining & Mktg. Inc. Proj.), Ser. A,
5.10%, VRDN due 8/1/24 VMIG-1 A+ 1,100
1,000 Carlton (WI) PCR (Wisconsin Pwr. & Light Co.
Proj.), Ser. 1988, 4.85%, VRDN due 8/1/15 P-1 AA 1,000
800 Carroll Co. (KY) Solid Waste Disp. Fac. Rev.
(Kentucky Util. Co. Proj.), Ser. 1994 A, 5.05%,
VRDN due 11/1/24 VMIG-1 A-1+ 800
700 Delaware Econ. Dev. Au. Fac. Rev. (Delmarva Pwr. &
Light Co. Proj.), 5.35%, VRDN due 10/1/17 VMIG-1 A-1 700
2,000 Gulf Coast (TX) IDA Marine Term. Rev. (Amoco Oil
Co. Proj.), Ser. 1993, 5.05%, VRDN due 4/1/28 VMIG-1 A-1+ 2,000
200 Harris Co. (TX) Ind. Dev. Corp. PCR (Exxon Proj.),
Ser. 1987, 5.05%, VRDN due 8/15/27 P-1 A-1+ 200
1,600 Hillsborough Co. (FL) IDA PCR (Tampa Elec. Co.
Proj.), Ser. 1993, 5.00%, VRDN due 11/1/20 VMIG-1 A-1+ 1,600
800 Minneapolis (MN) Comm. Dev. Agcy. Ref. PCR
(Northern States Pwr. Co. Proj.), Ser. 1985,
4.70%, VRDN due 3/1/11 P-1 A-1+ 800
2,100 Oak Creek (WI) PCR (Wisconsin Elec. Pwr. Co.
Proj.), Ser. 1986, 4.75%, VRDN due 8/1/16 P-1 AA 2,100
3,400 Parish of Plaquemines (LA) Env. Rev. (British
Petroleum Exploration & Oil Inc. Proj.), Ser.
1994, 5.10%, VRDN due 10/1/24 & 5/1/25 P-1 A-1+ 3,400
</TABLE>
27
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- ----------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
$ 3,000 Seattle (WA) Muni. Light & Pwr. Rev., Ser. 1991 B,
4.25%, TECP due 7/12/95 VMIG-1 A-1+ $ 3,000
2,000 Texas Pub. Fin. Au. Rev., Ser. B, 4.15%, TECP due
8/23/95 VMIG-1 SP-1+ 2,000
--------
20,700
--------
TAX-EXEMPT CASH EQUIVALENT SECURITIES -- BACKED BY
LETTERS OF CREDIT (61.2%)
ABN -- AMRO BANK
850 Illinois Dev. Fin. Au. Econ. Dev. (Wilton Corp.),
Ser. 1989 B, 4.90%, VRDN due 5/1/09 VMIG-1 850
1,000 Massachusetts Bay Trans. Au., 3.90%, TECP due
5/23/95 P-1 A-1+ 1,000
900 Prince George's Co. (MD) Ref. Rev. (Frank Parsons
Paper Co., Inc. Fac.), Ser. 1987, 4.10%, VRDN due
1/1/13 P-1 A-1+ 900
1,900 Travis Co. (TX) Hsg. Fin. Corp. Multi-Family Hsg.
Rev. (Primecrest Ltd. Proj.), Ser. A, 4.75%, VRDN
due 3/1/20 A-1+ 1,900
BANK OF AMERICA
500 California Hlth. Fac. Au. Hosp. Rev. (N.T. Enloe
Mem. Hosp.), Ser. 1985 A, 4.20%, VRDN due 1/1/16 A-1 500
100 Coconino Co. (AZ) Poll. Ctrl. Corp. PCR (Arizona
Pub. Svc. Co. Navajo Proj.), Ser. 1994 A, 5.10%,
VRDN due 10/1/29 P-1 A-1 100
BANQUE INDOSUEZ-FRANCE
300 Brunswick & Glynn Cos. (GA) Dev. Au. (Jekyll Dev.
Assoc., L.P. Proj.), Ser. 1985, 4.60%, VRDN due
12/1/15 A-1 300
BANQUE PARIBAS
900 Dade Co. (FL) Solid Waste IDR (Montenay-Dade, Ltd.
Proj.), Ser. 1989 & 1990 A, 4.80%, VRDN due
12/1/10 & 12/1/13 A-1 900
</TABLE>
28
<PAGE>
April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
$ 600 Robbinsdale (MN) IDR (Unicare Homes Inc. Proj.),
4.70%, VRDN due 10/1/14 A-1 $ 600
BARCLAYS BANK INT'L., LTD.
4,700 Florida HFA Hsg. Rev. (Ashley Lake Park Proj. #2),
Ser. 1989 J, 4.70%, VRDN due 12/1/11 VMIG-1 4,700
CANADIAN IMPERIAL BANK OF COMMERCE
2,000 Albuquerque (NM) Gross Receipts/Lodgers' Tax Ref.
Rev., Ser. 1991 A, 4.55%, VRDN due 7/1/22 VMIG-1 A-1+ 2,000
1,000 Memphis (TN) Arpt. Au. Rev. (Shelby Co. Arpt.),
4.30%, TECP due 6/15/95 P-1 A-1+ 1,000
1,925 Rhode Island Port Au. & Econ. Dev. Corp. Elec.
Energy Fac. Ref. Rev. (Newport Elec. Corp. Proj.),
Ser. 1994, 4.75%, VRDN due 9/1/11 VMIG-1 A-1+ 1,925
COMMONWEALTH BANK OF AUSTRALIA
3,000 Pendleton Co. (KY) Multi-County Lease Rev.
(Kentucky Assoc. of Counties Leasing Trust Prog.),
Ser. 1989, 3.95%, TECP due 5/5/95 A-1+ 3,000
CREDIT COMMERCIAL DE FRANCE
450 Elkhart Co. (IN) Econ. Dev. Rev. (Pace Amer. Inc.
Proj.), 5.10%, VRDN due 1/1/13 VMIG-1 450
300 Indiana Emp. Dev. Comm. Econ. Dev. Rev. (Metal
Svcs. & Supply Inc.), 5.10%, VRDN due 1/1/13 VMIG-1 300
500 Indiana Emp. Dev. Comm. Econ. Dev. Rev. (Mobel
Proj.), Ser. 1988, 5.10%, VRDN due 1/1/14 VMIG-1 500
50 Indiana Emp. Dev. Comm. Econ. Dev. Rev. (Southern
Indiana Rehabilitation Svc. Inc.), 5.10%, VRDN due
1/1/14 VMIG-1 50
170 Indiana Emp. Dev. Comm. Econ. Dev. Rev. (Triangle
Ventures), Ser. 1988, 5.10%, VRDN due 1/1/14 VMIG-1 170
</TABLE>
29
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- ----------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
$ 700 Mississippi Bus. Fin. Corp. IDR (Air Cruisers Co.,
Inc. Proj.), Ser. 1989 C, 4.85%, VRDN due 10/1/04 P-1 $ 700
250 South Carolina Jobs Econ. Dev. Au. (Brown Packing
Inc.), Ser. 1988 B, 5.10%, VRDN due 4/1/99 VMIG-1 250
300 South Carolina Jobs Econ. Dev. Au. (Kent Mfg.
Proj.), Ser. 1988 A, 5.10%, VRDN due 4/7/99 VMIG-1 300
50 South Carolina Jobs Econ. Dev. Au. (Mar-Mac Mfg.
Co.), Ser. 1988 A, 5.10%, VRDN due 4/7/99 VMIG-1 50
400 South Carolina Jobs Econ. Dev. Au. (Regal-Beloit
Corp.), Ser. 1987 A, 5.10%, VRDN due 5/7/01 P-1 400
100 South Carolina Jobs Econ. Dev. Au. (Sudan & Delta
Prop.), Ser. A, 5.10%, VRDN due 1/1/04 VMIG-1 100
500 South Carolina Jobs Econ. Dev. Au. (Phoenix
Finishing Proj.), Ser. 1988 B, 5.10%, VRDN due
4/1/04 VMIG-1 500
700 South Carolina Jobs Econ. Dev. Au. (Osmose Wood
Preserving), Ser. B, 5.10%, VRDN due 12/1/04 P-1 700
400 South Carolina Jobs Econ. Dev. Au. (Edens 321
Partnership), Ser. 1987 A, 5.10%, VRDN due 11/7/07 P-1 400
650 South Carolina Jobs Econ. Dev. Au. (Florence RHF
Hsg. Inc.), Ser. 1987 A, 5.10%, VRDN due 11/7/07 P-1 650
CREDIT SUISSE BANK
1,500 Emery Co. (UT) Ref. PCR (PacifiCorp Proj.), Ser.
1991, 4.05%, TECP due 5/10/95 VMIG-1 A-1+ 1,500
1,200 Hubbard Co. (MN) Solid Waste Disp. Rev. (Potlatch
Corp. Proj.), Ser. 1990, 4.80%, VRDN due 8/1/14 A-1+ 1,200
</TABLE>
30
<PAGE>
April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
$ 500 Montgomery Co. (TX) Ind. Dev. Corp. IDR (Tile
Corp.), Ser. 1986 B, 4.95%, VRDN due 12/1/03 A-1+ $ 500
900 Salt Lake City (UT) Arpt. Rev., Ser. 1994 A,
5.15%, VRDN due 6/1/98 VMIG-1 A-1+ 900
1,000 Wake Co. (NC) Ind. Fac. & Poll. Ctrl. Fin. Au. PCR
(Carolina Pwr. & Light Co. Proj.), Ser. 1985 A,
4.60%, VRDN due 5/1/15 P-1 A-1+ 1,000
600 Warren Co. (AR) Solid Waste Disp. Rev. (Potlatch
Corp. Proj.), 4.80%, VRDN due 4/1/12 A-1+ 600
DEUTSCHE BANK
2,000 New Hampshire IDA PCR (Connecticut Light & Pwr.
Co. Proj.), Ser. 1986, 4.80%, VRDN due 11/1/16 VMIG-1 AAA 2,000
DOW CHEMICAL CORP.
2,850 Brazos (TX) River Harbor Navigation Dist. PCR
(Brazoria Co., Dow Chemical Co. Proj.), Ser. 1988
& 1990, 4.20% & 4.25%, TECP due 5/1/95 & 6/15/95 P-1 2,850
500 Iberville Parish (LA) PCR (Dow Chemical Co.
Proj.), 4.85%, VRDN due 8/1/01 P-1 500
2,000 Michigan Strategic Fund PCR (Dow Chemical Co.
Proj.), Ser. 1986 & 1988, 4.00% & 4.20%, TECP due
5/11/95 & 5/22/95 P-1 A-1 2,000
300 West Baton Rouge Parish (LA) Ind. Dist. #3 Rev.
(Dow Chemical Co. Proj.), 5.10%, VRDN due 12/1/23 P-1 A-1 300
DRESDNER BANK
1,000 Michigan Strategic Fund IDR (Allen Group Inc.
Proj.), 4.55%, VRDN due 11/1/25 VMIG-1 1,000
</TABLE>
31
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- ----------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
GENERAL ELECTRIC CAPITAL CORP.
$ 4,350 Mt. Vernon (IN) Solid Waste Disp. PCR (General
Elec. Co. Proj.), Ser. 1989, 4.10%-4.30%, TECP due
5/8/95-8/4/95 P-1 A-1+ $ 4,350
LASALLE NATIONAL BANK
2,000 Bolingbrook (IL) Multi-Family Hsg. Rev. (Amberton
Apts.), 4.85%, VRDN due 11/1/19 A-1+ 2,000
MORGAN GUARANTY TRUST CO.
300 Daviess Co. (KY) Solid Waste Disp. Fac. Rev.
(Scott Paper Co. Proj.), Ser. 1993 A, 5.05%, VRDN
due 12/1/23 VMIG-1 A-1+ 300
1,650 Florida Muni. Pwr. Agcy. Rev. (Initial Pooled Loan
Proj.), Ser. A, 4.00%, TECP due 5/12/95 VMIG-1 A-1+ 1,650
400 Mobile (AL) IDB Solid Waste Disp. Rev. (Scott
Paper Co.), Ser. B, 4.65%, VRDN due 12/1/19 P-1 A-1+ 400
1,000 North Carolina Eastern Muni. Pwr. Agcy. Pwr. Sys.
Rev., Ser. 1988 B, 4.00%, TECP due 6/7/95 A-1+ 1,000
1,000 Port of Kalama (WA) Pub. Corp. Port Fac. Rev.
(ConAgra, Inc. Proj.), 4.65%, VRDN due 1/1/04 A-1+ 1,000
NATIONAL WESTMINSTER BANK
2,000 Carbon Co. (PA) IDA Res. Rec. Rev. (Panther Creek
Partners Proj.), Ser. A, 4.25%, TECP due 8/8/95 P-1 A-1+ 2,000
3,300 Marion Co. Comm. (WV) Solid Waste Disp. Fac. Rev.
(Grant Town Cogeneration Proj.), Ser. 1990 A-D,
4.60% & 4.85%, VRDN due 10/1/17 VMIG-1 A-1+ 3,300
1,000 Rhode Island Std. Loan Au. Std. Loan Prog. Rev.,
1st Ser. 1995, 4.75%, VRDN due 7/1/19 A-1+ 1,000
1,075 Texas Small Bus. Ind. Dev. Corp. (Texas Pub. Fac.
Cap. Access Prog.), Ser. 1986, 4.80%, VRDN due
7/1/26 VMIG-1 1,075
</TABLE>
32
<PAGE>
April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
NORWEST BANK
$ 800 New Ulm (MN) Hosp. Ref. Rev. (Hlth. Central Sys.
Proj.), Ser. 1985, 4.35%, VRDN due 8/1/14 A-1+ $ 800
PNC BANK
400 Florida HFA Multi-Family Hsg. Rev. (Falls of
Venice Proj.), Ser. E, 4.65%, VRDN due 12/1/11 P-1 A-1 400
SOCIETE GENERALE
3,000 Burlington (KS) Imp. Ref. PCR (Kansas City Pwr. &
Light Co. Proj.), Ser. 1985 B, 4.00%, TECP due
5/18/95 P-1 3,000
1,900 Chicago (IL) O'Hare Int'l. Arpt. Spec. Fac. Rev.
(Compagnie Nationale Air France Proj.), Ser. 1990,
4.80%, VRDN due 5/1/18 A-1+ 1,900
1,000 Illinois Toll Highway Au. Toll Highway Ref. Rev.,
Ser. 1993 B, 4.70%, VRDN due 1/1/10 VMIG-1 A-1+ 1,000
100 Indianapolis (IN) Multi-Family Ref. Rev. (Canal
Square Proj.), Ser. 1989, 4.60%, VRDN due 12/1/15 VMIG-1 100
STUDENT LOAN MARKETING ASSOC.
200 Colorado Std. Oblig. Bond Au. Std. Loan Rev., Ser.
1993 A, 4.50%, VRDN due 7/1/99 VMIG-1 A-1+ 200
300 Nebraska Higher Ed. Loan Prog., Inc. Std. Loan
Prog. Rev., Ser. 1986 A, 4.75%, VRDN due 12/1/16 A-1+ 300
SUN BANK
2,000 Orange Co. (FL) Hlth. Fac. Au. Rev. (SHCC Svcs.,
Inc. Proj.), Ser. 1992, 4.65%, VRDN due 12/1/23 VMIG-1 2,000
SWISS BANK CORP.
400 Clark Co. (NV) IDR (Nevada Cogeneration Assoc. 2
Proj.), Ser. 1992, 5.05%, VRDN due 12/1/22 VMIG-1 A-1+ 400
</TABLE>
33
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- ----------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
$ 2,000 Mobile (AL) IDB Solid Waste Disp. Rev. (Scott
Paper Co.), Ser. E, 4.65%, VRDN due 12/1/19 P-1 A-1+ $ 2,000
1,200 Pennsylvania Energy Dev. Au. Rev. (B & W Ebensburg
Proj.), Ser. 1986, 4.65%, VRDN due 12/1/11 VMIG-1 1,200
3,800 Port of Port Arthur (TX) Navigation Dist. of
Jefferson Co. PCR (Star Enterprise Proj.), Ser.
1994, 4.80%, VRDN due 4/1/14 A-1+ 3,800
1,000 San Antonio (TX) Hsg. Fin. Corp. Multi-Family Hsg.
Rev. (Braesview Apts. Proj.), Ser. 1990, 4.70%,
VRDN due 11/1/20 A-1+ 1,000
TORONTO DOMINION BANK
2,000 Clark Co. (NV) Arpt. Imp. Rev., Ser. A-1, 4.50%,
VRDN due 7/1/25 VMIG-1 A-1+ 2,000
120 Wisconsin Hlth. Fac. Au. (Franciscan Hlth. Care,
Inc. -- Sys. Fin.), Ser. 1985 A-2, 4.65%, VRDN due
1/1/16 VMIG-1 A-1+ 120
UNION BANK OF SWITZERLAND
1,705 Des Moines (IA) Comm. Dev. Rev. (Capitol Center
III Proj.), Ser. 1985, 4.75%, VRDN due 12/1/15 VMIG-1 1,705
200 Indiana Emp. Dev. Comm. Econ. Dev. Rev. (K & F
Ind. Inc.), 5.10%, VRDN due 1/1/14 VMIG-1 200
4,700 Pennsylvania Higher Ed. Assist. Agcy. Std. Loan
Rev., Ser. 1988 B, 4.60%, VRDN due 7/1/18 VMIG-1 A-1+ 4,700
WESTPAC BANKING CORP.
1,000 Chicago (IL) O'Hare Int'l. Arpt. Fac. Rev. (Gen.
Arpt. 2nd Lien), Ser. 1984 A, 4.75%, VRDN due
1/1/15 VMIG-1 A-1 1,000
--------
85,445
--------
</TABLE>
34
<PAGE>
April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- ----------------- -------------------------------------------------- ------- ------- -----------------
<C> <S> <C> <C> <C>
TAX-EXEMPT CASH EQUIVALENT SECURITIES -- BACKED BY
INSURANCE (0.8%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
$ 400 Sayre (PA) Hlth. Care Fac. Au. (VHA of PA Inc.,
Cap. Asset Fin. Prog.), Ser. 1985 A, 4.75%, VRDN
due 12/1/20 Aaa A-1 $ 400
FINANCIAL GUARANTY INSURANCE CO.
500 Pinellas Co. (FL) Hlth. Care Fac. Au. Ref. Rev.
(Bayfront Med. Ctr. Inc. Proj.), 4.55%, VRDN due
6/1/09 VMIG-1 A-1 500
MUNICIPAL BOND INVESTORS ASSURANCE CORP.
188 Clermont (OH) Hosp. Fac. Rev. (Mercy Hlth. Care
Sys., Province of Cincinnati), Ser. 1985 B,
4.625%, VRDN due 12/1/15 VMIG-1 A-1+ 188
--------
1,088
--------
TOTAL INVESTMENTS (100.7%) 140,688
Liabilities, less cash, receivables and other
assets [(0.7%)] (1,012)
--------
TOTAL NET ASSETS (100.0%) $ 139,676
--------
</TABLE>
35
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- ----------------------------------------------------------------------
Municipal Securities Portfolio
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------------------- --------- --------- -------------
<C> <S> <C> <C> <C>
TAX-EXEMPT SECURITIES -- PRE-REFUNDED
BACKED BY U.S. GOVERNMENT SECURITIES (6.8%)
$ 1,000 Harris Co. (TX) Toll Road Rev., Ser. A,
6.50%, due 8/15/17 P/R 8/15/02 Aaa $ 1,098
1,000 Massachusetts Wtr. Res. Au. Gen. Rev., Ser.
1992 A, 6.50%, due 7/15/21 P/R 7/15/02 Aaa AAA 1,090
750 Ohio Higher Ed. Fac. (Ohio Pub. Fac.
Comm.), Ser. 1987 B, 7.00%, due 6/1/04 P/R
6/1/97 A1 A+ 796
-------------
2,984
-------------
TAX-EXEMPT SECURITIES -- BACKED BY
INSURANCE (17.5%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
2,000 Harris Co. (TX) Toll Road Sr. Lien Ref.
Rev., Ser. 1994, 4.30%, due 8/15/00 Aaa AAA 1,906
750 West Geauga (OH) Local Sch. Dist. Unlimited
Tax G.O., Ser. 1994, 5.25%, due 11/1/02 Aaa AAA 757
FINANCIAL GUARANTY INSURANCE CO.
325 Metropolitan (DC) Arpts. Au. Arpt. Sys.
Rev., Ser. 1990 A, 6.90%, due 10/1/99 Aaa AAA 348
750 New York Dorm. Au. Ed. Fac. Rev. (State
Univ.), Ser. 1993 B, 5.20%, due 5/15/03 Aaa AAA 751
MUNICIPAL BOND INVESTORS ASSURANCE CORP.
1,000 Burlington (VT) Elec. Sys. Rev., Ser. 1986
A, 6.65%, due 7/1/96 Aaa 1,026
500 Hawaii Arpt. Sys. Ref. Rev., Ser. 1993,
5.80%, due 7/1/01 Aaa AAA 519
1,000 Nebraska Inv. Fin. Au. Hosp. Rev. (Nebraska
Methodist Hlth. Sys., Inc.), Ser. 1991,
7.00%, due 3/1/06 Aaa AAA 1,096
1,000 Rhode Island Clean Wtr. Protection Fin.
Agcy. PCR (Revolving Fund Pooled Loan
Issue), Ser. 1993 A, 9.20%, due 10/1/03 Aaa AAA 1,261
-------------
7,664
-------------
</TABLE>
36
<PAGE>
April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Municipal Securities Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------------------- --------- --------- -------------
<C> <S> <C> <C> <C>
TAX-EXEMPT SECURITIES -- OTHER (75.5%)
$ 1,000 Baltimore Co. (MD) Metro. Dist. G.O., 64th
Issue, 4.25%, due 8/1/02 Aaa AA+ $ 925
1,060 Brownwood (TX) Independent Sch. Dist.
Unlimited Tax Sch. Bldg. & Ref. G.O. (Brown
Co., Texas), Ser. 1994, Zero Coupon,
Yielding 5.90% & 6.10%, due 2/15/02 &
2/15/04 Aaa 688
1,000 California Ed. Fac. Au. Rev. (Univ. of So.
Cal. Proj.), Ser. 1989 B, 6.80%, due
10/1/99 Aa AA 1,083
750 Cincinnati (OH) Std. Loan Funding Corp.
Std. Loan Ref. Rev., Ser. 1992 C, 6.10%,
due 7/1/02 Aaa 768
500 Commonwealth of Virginia Trans. Rev. (No.
Virginia Trans. Dist. Prog.), Ser. 1993 C,
4.60%, due 5/15/01 Aa AA 483
1,000 Georgia G.O., Ser. 1994 D, 6.80%, due
8/1/00 Aaa AA+ 1,091
1,000 Jacksonville (FL) Elec. Au. (St. John's
River Pwr. Park Sys.), 4th Crossover Ser.,
6.375%, due 10/1/99 Aa1 AA 1,059
1,000 Los Angeles Co. (CA) Pension Oblig. Cert.
Deb., Ser. A, 6.875%, due 6/30/07 A A 1,038
1,500 Maryland Comm. Dev. Admin. Dept. Hsg. &
Comm. Dev. Rev. (Single-Family Prog.), 3rd
Ser., 5.15%, due 4/1/08 Aa 1,384
500 Maryland Nat'l. Cap. Park & Planning Comm.
(Prince George's Co.), Ser. J2, 6.90%, due
7/1/99 Aa AA 540
1,000 Maryland St. & Local Fac. Loan G.O., 2nd
Ser. 1989 T, 6.40%, due 7/15/98 Aaa AAA 1,054
400 Maryland St. & Local Fac. Loan Imp. & Ref.
G.O., 3rd Ser. 1990 W, 6.60%, due 7/15/00 Aaa AAA 433
1,000 Minnesota Ref. G.O., 5.20%, due 8/1/00 Aa1 AA 1,018
700 Mississippi Higher Ed. Assist. Corp. Std.
Loan Rev., Ser. 1993 B, 5.50%, due 9/1/03 Aaa 695
1,950 Mississippi Higher Ed. Assist. Corp. Std.
Loan Rev., Ser. 1993 C, 6.05%, due 9/1/07 A 1,935
</TABLE>
37
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- ----------------------------------------------------------------------
Municipal Securities Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------------------- --------- --------- -------------
<C> <S> <C> <C> <C>
$ 150 Missouri Env. Imp. & Energy Res. Au. Wtr.
PCR (State Revolving Fund Prog. Multiple
Participant Series), Ser. 1994 A, 4.70%,
due 7/1/98 Aa $ 149
420 Nevada Hsg. Div. Single-Family Prog. Ref.
Rev. (Fed. Ins. or Gtd. Mtge. Loans), Ser.
1993 R, 5.20%, due 4/1/01 A1 AA 410
1,000 Nevada Ltd. Tax Cap. Imp. G.O., Ser. 1991
A, 7.125%, due 5/1/99 Aa AA 1,080
500 New Jersey Bldg. Au. Rev., Ser. 1994,
5.00%, due 6/15/11 Aa AA- 449
750 New York City (NY) IDA Spec. Fac. Rev.
(Term One Group Assoc., L.P. Proj.), Ser.
1994, 6.00%, due 1/1/15 A A 711
1,000 New York Dorm. Au. Rev. (Columbia Univ.),
Ser. 1994 A, 4.00%, due 7/1/00 Aaa AA+ 954
1,000 Omaha (NE) Pub. Pwr. Dist. Elec. Sys. Rev.,
Ser. 1993 E, 4.60%, due 2/1/06 Aa AA 909
500 Omaha (NE) Var. Purp. G.O., Ser. 1990,
7.00%, due 5/1/99 Aaa AAA 542
1,000 Pennsylvania Higher Ed. Fac. Au. College &
Univ. Rev. (Univ. of Pennsylvania), Ser. A,
6.50%, due 9/1/02 Aa AA 1,087
500 Phoenix (AZ) Waste Wtr. Sys. Ref. Rev.,
Ser. 1993, 4.95%, due 7/1/03 A1 AA 486
1,000 Platte River (CO) Pwr. Au. Rev., Ser. AA,
6.60%, due 6/1/02 Aa A+ 1,052
2,000 Port of Portland (OR) Ref. G.O., Ser. A,
4.50%, due 3/1/05 Aa AA+ 1,810
1,000 Seattle (WA) Muni. Light & Pwr. Ref. Rev.,
Ser. 1993, 4.90%, due 11/1/03 Aa AA 960
2,000 South Carolina Cap. Imp. Unlimited Tax
G.O., Ser. A, 5.00%, due 3/1/02 Aaa AA+ 1,998
1,000 Texas Pub. Fin. Au. Ref. G.O., Ser. A,
6.50%, due 10/1/04 Aa AA 1,094
</TABLE>
38
<PAGE>
April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Municipal Securities Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------------------- --------- --------- -------------
<C> <S> <C> <C> <C>
$ 1,000 Utah Bldg. G.O., Ser. 1991 F, 5.50%, due
7/1/98 Aaa AAA $ 1,025
1,045 Utah Hsg. Fin. Agcy. Single-Family Mtge.
Purchase Ref. Rev., Ser. 1993 A, 5.40%, due
1/1/03 & 7/1/03 Aa 1,023
1,000 Washington G.O., 5.50%, due 7/1/97 Aa AA 1,017
1,000 Washington Motor Vehicle Fuel Tax G.O.,
Ser. D, 6.50%, due 9/1/01 Aa AA 1,076
1,000 Wisconsin Hlth. & Ed. Fac. Au. Rev.
(Sisters of the Sorrowful Mother-Ministry
Corp.), Ser. 1993 B, 5.00%, due 8/15/98 AA- 988
-------------
33,014
-------------
TAX-EXEMPT CASH EQUIVALENT SECURITIES
(3.0%)
700 Butler Co. (KS) Solid Waste Disp. Fac. Rev.
(Texaco Refining & Mktg. Inc. Proj.), Ser.
A, 5.10%, VRDN due 8/1/24 VMIG-1 A+ 700
200 Delaware Econ. Dev. Au. Fac. Rev. (Delmarva
Pwr. & Light Co. Proj.), 5.35%, VRDN due
10/1/17 VMIG-1 A-1 200
400 Harris Co. (TX) Ind. Dev. Corp. PCR (Exxon
Proj.), Ser. 1987, 5.05%, VRDN due 8/15/27 P-1 A-1+ 400
-------------
1,300
-------------
TAX-EXEMPT CASH EQUIVALENT
SECURITIES -- BACKED BY LETTERS OF CREDIT
(0.6%)
CREDIT COMMERCIAL DE FRANCE
50 South Carolina Jobs Econ. Dev. Au. (Sudan &
Delta Prop.), Ser. A, 5.10%, VRDN due
1/1/04 VMIG-1 50
DOW CHEMICAL CORP.
100 Brazos (TX) River Harbor Navigation Dist.
Rev. (Brazoria Co., Dow Chemical Co.
Proj.), Ser. 1993, 5.10%, VRDN due 5/1/23 P-1 A-1 100
</TABLE>
39
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Municipal Securities Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------------------- --------- --------- -------------
<C> <S> <C> <C> <C>
SOCIETE GENERALE
$ 100 Platte Co. (WY) Tri-State Gen. & Trans.
PCR, Ser. A, 5.10%, VRDN due 7/1/14 P-1 $ 100
-------------
250
-------------
TOTAL INVESTMENTS (103.4%) (COST $45,807) 45,212(3)
Liabilities, less cash, receivables and
other assets [(3.4%)] (1,488)
-------------
TOTAL NET ASSETS (100.0%) $ 43,724
-------------
</TABLE>
40
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
New York Insured Intermediate Portfolio
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------------------- --------- --------- -------------
<C> <S> <C> <C> <C>
TAX-EXEMPT SECURITIES -- PRE-REFUNDED
BACKED BY U.S. GOVERNMENT SECURITIES (2.0%)
$ 185 New York Local Gov't. Assist. Corp., Ser.
1991 A, 7.00%, due 4/1/16 P/R 4/1/01 Aaa AAA $ 206
-------------
TAX-EXEMPT SECURITIES -- BACKED BY
INSURANCE (75.3%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
275 William Floyd (NY) Union Free Sch. Dist.
(The Mastics-Moriches-Shirley), 4.80%, due
12/1/03 Aaa AAA 263
FINANCIAL GUARANTY INSURANCE CO.
555 Babylon (NY) Waste Fac. G.O., Ser. 1993,
4.40%, due 8/1/03 Aaa AAA 514
500 Chautauqua Co. (NY) Var. Purp. G.O., Ser.
1991, 6.40%, due 9/15/04 Aaa AAA 545
435 New York City (NY) G.O., Ser. 1990 I,
6.90%, due 8/15/98 Aaa AAA 463
300 New York City (NY) Muni. Assist. Corp.,
Ser. 1991 A, 6.60%, due 7/1/01 Aaa AAA 324
405 New York Dorm. Au. Rev. (Union College),
Ser. 1992, 5.50%, due 7/1/03 Aaa AAA 414
450 North Hempstead (NY) Ref. G.O., Ser. 1992
B, 5.90%, due 4/1/04 Aaa AAA 477
550 Suffolk Co. (NY) Ind. Dev. Agcy. Rev. (S.W.
Swr. Sys.), Ser. 1994, 4.70%, due 2/1/04 Aaa AAA 516
470 Triborough Bridge & Tunnel Au. (NY) Spec.
Oblig., Ser. 1992, 5.80%, due 1/1/02 Aaa AAA 490
FINANCIAL SECURITY ASSURANCE CORP.
1,000 New York Med. Care Fac. Fin. Agcy. Imp.
Ref. Rev. (Mental Hlth. Svcs.), Ser. 1993
F, 4.75% & 4.80%, due 8/15/04 & 2/15/05 Aaa AAA 933
MUNICIPAL BOND INVESTORS ASSURANCE CORP.
500 Broome Co. (NY) Cert. of Participation
(Pub. Safety Fac.), Ser. 1994, 4.50%, due
4/1/01 Aaa AAA 479
485 Buffalo (NY) Sch. G.O., Ser. 1994 B, 5.05%,
due 2/1/04 & 2/1/05 Aaa AAA 478
</TABLE>
41
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
New York Insured Intermediate Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------------------- --------- --------- -------------
<C> <S> <C> <C> <C>
$ 390 Eldred (NY) Central Sch. Dist., Ser. 1994,
4.50%, due 12/15/05 Aaa AAA $ 352
500 New York City (NY) Muni. Assist. Corp.,
Ser. 57, 7.25%, due 7/1/08 Aaa AAA 524
450 New York Dorm. Au. Rev. (Leake & Watts
Svcs. Inc.), Ser. 1994, 5.10%, due 7/1/02 Aaa AAA 448
415 Oyster Bay (NY) Pub. Imp. Ref. G.O., 5.40%,
due 2/15/03 Aaa AAA 422
300 Warren Co. (NY) Pub. Imp. G.O., Ser. 1993
A, 4.40%, due 11/15/07 Aaa AAA 266
-------------
7,908
-------------
TAX-EXEMPT SECURITIES -- OTHER (17.1%)
500 New York Thruway Au. (Local Hwy. & Bridge
Svc. Contract), Ser. 1991, 7.00%, due
1/1/03 Baa1 BBB 541
770 New York Urban Dev. Corp. Proj. Rev.
(Columbia Univ. Ctr. for Computers,
Microelectronics and Telecommunications
Grant), Ser. 1994, 4.75%-5.00%, due
1/1/02-1/1/04 Baa1 BBB 720
500 Puerto Rico Pub. Bldg. Au. Ref. Rev., Ser.
J, 6.50%, due 7/1/03 Baa1 A 532
-------------
1,793
-------------
TAX-EXEMPT CASH EQUIVALENT
SECURITIES -- BACKED BY INSURANCE (1.9%)
FINANCIAL GUARANTY INSURANCE CO.
200 New York City (NY) Muni. Wtr. Fin. Au. Wtr.
& Swr. Sys. Rev., Ser. 1993 C, 5.10%, VRDN
due 6/15/22 VMIG-1 A-1+ 200
-------------
TOTAL INVESTMENTS (96.3%) (COST $10,459) 10,107(3)
Cash, receivables and other assets, less
liabilities (3.7%) 392
-------------
TOTAL NET ASSETS (100.0%) $ 10,499
-------------
</TABLE>
42
<PAGE>
NOTES TO SCHEDULE OF INVESTMENTS
April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
1) These municipal securities meet the two, three, and four highest ratings for
Neuberger&Berman Municipal Money Portfolio, Neuberger&Berman Municipal
Securities Portfolio, and Neuberger&Berman New York Insured Intermediate
Portfolio, respectively, assigned by Moody's Investors Service, Inc. or
Standard & Poor's Corporation or, where not rated, are determined by the
Portfolios to be of comparable quality within guidelines approved by the
Trustees of Income Managers Trust. Approximately 68%, 25%, and 82% of the
municipal securities held by Neuberger&Berman Municipal Money Portfolio,
Neuberger&Berman Municipal Securities Portfolio, and Neuberger&Berman New
York Insured Intermediate Portfolio, respectively, have credit enhancement
features backing them, which the Portfolios rely on, such as letters of
credit, insurance, or guarantees. Without these credit enhancement features
the securities may or may not meet the quality standards of the Portfolios.
Pre-refunded bonds are supported by securities in escrow issued or guaranteed
by the U.S. Government, its agencies, or instrumentalities. The amount
escrowed is sufficient to pay the periodic interest due and the principal of
these bonds. Putable bonds give the Portfolios the right to put back the
issue on the date specified.
2) Investment securities of Neuberger&Berman Municipal Money Portfolio are
valued at amortized cost, which approximates Federal income tax cost.
Investment securities of Neuberger&Berman Municipal Securities Portfolio and
Neuberger&Berman New York Insured Intermediate Portfolio are valued daily by
obtaining bid price quotations from an independent pricing service on all
securities available in the service's data base. For all other securities
requiring daily quotations, bid prices are obtained from principal market
makers in those securities.
3) At April 30, 1995, selected Portfolio information on a Federal income tax
basis was as follows:
<TABLE>
<CAPTION>
GROSS GROSS
UNREALIZED UNREALIZED NET UNREALIZED
NEUBERGER&BERMAN COST APPRECIATION DEPRECIATION DEPRECIATION
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MUNICIPAL SECURITIES PORTFOLIO $45,807,000 $ 274,000 $ 869,000 $ 595,000
NEW YORK INSURED INTERMEDIATE
PORTFOLIO 10,470,000 13,000 376,000 363,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
43
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
NEW YORK
MUNICIPAL MUNICIPAL INSURED
MONEY SECURITIES INTERMEDIATE
(000'S OMITTED) PORTFOLIO PORTFOLIO PORTFOLIO
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investments in securities, at value* (Note
A) -- see Schedule of Investments $ 140,688 $ 45,212 $ 10,107
Cash 294 28 33
Deferred organization costs (Note A) 9 3 13
Interest receivable 1,077 600 143
Prepaid expenses and other assets 4 2 --
Receivable for securities sold 200 -- 221
------------------------------------------
142,272 45,845 10,517
------------------------------------------
LIABILITIES
Payable for securities purchased 2,528 2,087 --
Payable to investment manager (Note B) 28 8 2
Accrued expenses 40 26 16
------------------------------------------
2,596 2,121 18
------------------------------------------
NET ASSETS Applicable to Investors' Beneficial
Interests $ 139,676 $ 43,724 $ 10,499
------------------------------------------
NET ASSETS consist of:
Paid-in capital $ 139,676 $ 44,345 $ 10,851
Net unrealized depreciation in value of
investments and financial futures
contracts -- (621) (352)
------------------------------------------
NET ASSETS $ 139,676 $ 43,724 $ 10,499
------------------------------------------
*Cost of investments $ 140,688 $ 45,807 $ 10,459
------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
44
<PAGE>
STATEMENTS OF OPERATIONS
For the Six Months Ended April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
NEW YORK
MUNICIPAL MUNICIPAL INSURED
MONEY SECURITIES INTERMEDIATE
(000'S OMITTED) PORTFOLIO PORTFOLIO PORTFOLIO
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME
Interest income $ 3,018 $ 1,142 $ 307
--------------------------------------------
Expenses:
Investment management fee (Note B) 193 54 15
Accounting fees 5 5 5
Amortization of deferred organization and
initial offering expenses (Note A) 2 1 1
Auditing fees 15 11 10
Custodian fees 48 18 8
Insurance expense 3 2 1
Legal fees 5 6 3
Trustees' fees and expenses 10 4 3
--------------------------------------------
Total expenses 281 101 46
--------------------------------------------
Net investment income 2,737 1,041 261
--------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FINANCIAL FUTURES CONTRACTS
Net realized loss on investments sold (25) (378) (80)
Net realized loss on financial futures
contracts (Note A) -- (65) --
Change in net unrealized depreciation of
investments -- 1,433 538
Net unrealized depreciation of financial
futures contracts (Note A) -- (26) --
--------------------------------------------
Net gain (loss) on investments and
financial futures contracts (25) 964 458
--------------------------------------------
Net increase in net assets resulting
from operations $ 2,712 $ 2,005 $ 719
--------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
45
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
- ----------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
MUNICIPAL
MONEY
PORTFOLIO
Six Months
Ended April Year
30, Ended
1995 October 31,
(000'S OMITTED) (UNAUDITED) 1994
- -------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 2,737 $ 3,928
Net realized gain (loss) on
investments sold and financial
futures contracts (25) 5
Change in net unrealized
appreciation (depreciation) of
investments and financial futures
contracts -- --
-------------------------------
Net increase (decrease) in net
assets resulting from operations 2,712 3,933
-------------------------------
TRANSACTIONS IN INVESTORS' BENEFICIAL
INTERESTS:
Additions 86,893 164,863
Reductions (100,392) (200,098)
-------------------------------
Net increase (decrease) in net
assets resulting from transactions
in investors' beneficial interests (13,499) (35,235)
-------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (10,787) (31,302)
NET ASSETS:
Beginning of period 150,463 181,765
-------------------------------
End of period $ 139,676 $ 150,463
-------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
46
<PAGE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MUNICIPAL NEW YORK
SECURITIES INSURED INTERMEDIATE
PORTFOLIO PORTFOLIO
Six Months Six Months Period from February
Ended Year Ended 1, 1994 (Commencement
April 30, Ended April 30, of Operations) to
1995 October 31, 1995 October 31,
(OOO'S OMITTED) (UNAUDITED) 1994 (UNAUDITED) 1994
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 1,041 $ 3,653 $ 261 $ 445
Net realized gain (loss) on
investments sold and financial
futures contracts (443) (433) (80) (251)
Change in net unrealized
appreciation (depreciation) of
investments and financial futures
contracts 1,407 (4,761) 538 (890)
---------------------------------------------------------------------------------------
Net increase (decrease) in net
assets resulting from operations 2,005 (1,541) 719 (696)
---------------------------------------------------------------------------------------
TRANSACTIONS IN INVESTORS' BENEFICIAL
INTERESTS:
Additions 5,425 44,656 1,819 23,018
Reductions (15,068) (96,098) (6,799) (7,562)
---------------------------------------------------------------------------------------
Net increase (decrease) in net
assets resulting from transactions
in investors' beneficial interests (9,643) (51,442) (4,980) 15,456
---------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (7,638) (52,983) (4,261) 14,760
NET ASSETS:
Beginning of period 51,362 104,345 14,760 --
---------------------------------------------------------------------------------------
End of period $ 43,724 $ 51,362 $ 10,499 $ 14,760
---------------------------------------------------------------------------------------
</TABLE>
47
<PAGE>
NOTES TO FINANCIAL STATEMENTS
April 30, 1995 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman Municipal Money Portfolio ("Municipal Money"),
Neuberger&Berman Municipal Securities Portfolio ("Municipal Securities"),
and Neuberger&Berman New York Insured Intermediate Portfolio ("New York
Insured Intermediate") (collectively, the "Portfolios") are separate series
of Income Managers Trust ("Managers Trust"), a New York common law trust
organized as of December 1, 1992. Managers Trust is registered as an open-
end management investment company under the Investment Company Act of 1940.
New York Insured Intermediate commenced operations on February 1, 1994.
Other regulated investment companies sponsored by Neuberger&Berman
Management Incorporated ("Management"), whose financial statements are not
presented herein, also invest in other Portfolios of Managers Trust.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series, and no other.
2) PORTFOLIO VALUATION: Investments are valued as indicated in the notes
following the Portfolios' schedule of investments.
3) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Interest income, including accretion of
discount and amortization of premium, is recorded on the accrual basis.
Realized gains and losses from securities transactions are recorded on the
basis of identified cost.
4) FEDERAL INCOME TAXES: Managers Trust intends to comply with the requirements
of the Internal Revenue Code of 1986, as amended. Each Portfolio of Managers
Trust also intends to conduct its operations so that each of its investors
will be able to qualify as a regulated investment company. Each Portfolio
will be treated as a partnership for Federal income tax purposes and is
therefore not subject to Federal income tax.
5) ORGANIZATION EXPENSES: Expenses incurred by each Portfolio in connection
with its organization are being amortized by each Portfolio on a
straight-line basis over a five-year period. At April 30, 1995, the
unamortized balance of such expenses amounted to $9,325, $3,308, and $12,755
for Municipal Money, Municipal Securities, and New York Insured
Intermediate, respectively.
6) EXPENSE ALLOCATION: The Portfolios bear all costs of operations. Expenses
incurred with respect to any two or more Portfolios are allocated in
proportion to
48
<PAGE>
the net assets of such Portfolios, except where another more appropriate
allocation of expenses to each Portfolio can otherwise be made fairly.
Expenses directly attributable to a Portfolio are charged to that Portfolio.
7) FINANCIAL FUTURES CONTRACTS: Municipal Securities and New York Insured
Intermediate may buy and sell financial futures contracts to hedge against
the effects of fluctuations in interest rates. At the time the Portfolio
enters into a financial futures contract, it is required to deposit with its
custodian a specified amount of cash or U.S. government securities, known as
"initial margin," ranging upward from 1.1% of the value of the financial
futures contract being traded. Each day, the futures contract is valued at
the official settlement price of the board of trade or U.S. commodity
exchange on which such futures contract is traded. Subsequent payments,
known as "variation margin," to and from the broker are made on a daily
basis as the market price of the financial futures contract fluctuates.
Daily variation margin adjustments, arising from this "mark to market," are
recorded by the Portfolio as unrealized gains or losses.
Although some financial futures contracts by their terms call for actual
delivery or acceptance of financial instruments, in most cases the contracts
are closed out prior to delivery by offsetting purchases or sales of
matching financial futures contracts. When the contracts are closed, the
Portfolio recognizes a gain or loss. Risks of entering into futures
contracts include the possibility that there may be an illiquid market
and/or that a change in the value of the contract may not correlate with
changes in the value of the underlying securities.
For Federal income tax purposes, the futures transactions undertaken may
cause the Portfolio to recognize gains or losses from marking to market even
though its positions have not been sold or terminated, may affect the
character of the gains or losses recognized as long-term or short-term and
may affect the timing of some capital gains and losses realized by the
Portfolio. Also, the Portfolio's losses on its transactions involving
futures contracts may be deferred rather than being taken into account
currently in calculating such Portfolio's taxable income. During the six
months ended April 30, 1995, Municipal Securities entered into financial
futures contracts.
At April 30, 1995, open positions in financial futures contracts for
Municipal Securities were as follows:
<TABLE>
<CAPTION>
UNREALIZED
EXPIRATION OPEN CONTRACTS POSITION DEPRECIATION
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
June, 1995 25 U.S. Treasury Bond Short $ 25,781
</TABLE>
At April 30, 1995, Municipal Securities had deposited in a segregated
account, $1,500,000 par value of Mississippi Higher Ed. Assist. Corp. Std.
Loan
49
<PAGE>
Rev., Ser. 1993 C, 6.05%, due 9/1/07 and $1,000,000 par value of Omaha (NE)
Pub. Pwr. Dist. Elec. Sys. Rev., Ser. 1993 E, 4.60%, due 2/1/06, to cover
margin requirements on open financial futures contracts.
NOTE B -- MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES:
Each Portfolio retains Management as its investment manager under a
Management Agreement dated as of July 2, 1993, and February 1, 1994 (with
respect to New York Insured Intermediate). For such investment management
services, each Portfolio pays Management a fee at the annual rate of .25% of the
first $500 million of that Portfolio's average daily net assets, .225% of the
next $500 million, .20% of the next $500 million, .175% of the next $500
million, and .15% of average daily net assets in excess of $2 billion.
All of the capital stock of Management is owned by individuals who are also
general partners of Neuberger&Berman, L.P. ("Neuberger"), a member firm of The
New York Stock Exchange and the sub-adviser to each Portfolio. Several
individuals who are officers and/or trustees of Managers Trust are also partners
of Neuberger and/or officers and/or directors of Management.
NOTE C -- SECURITIES TRANSACTIONS:
During the six months ended April 30, 1995, there were purchase and sale
transactions (excluding short-term securities and financial futures contracts)
as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
- -------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL SECURITIES $14,589,170 $21,156,343
NEW YORK INSURED INTERMEDIATE 1,253,832 4,867,269
</TABLE>
All securities transactions for Municipal Money were short-term.
NOTE D -- UNAUDITED FINANCIAL INFORMATION:
The financial information included in this interim report is taken from the
records of each Portfolio without audit by independent auditors. Annual reports
contain audited financial statements.
50
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
NEW YORK
INSURED
MUNICIPAL MUNICIPAL INTERMEDIATE
MONEY SECURITIES PORTFOLIO
PORTFOLIO PORTFOLIO Period from
Period from Period from February 1,
July 2, 1993 July 2, 1993 1994
(Commencement (Commencement (Commencement
Six Months of Six Months of Six Months of
Ended April Operations) Ended April Operations) Ended April Operations)
30, Year Ended to October 30, Year Ended to October 30, to October
1995 October 31, 31, 1995 October 31, 31, 1995 31,
(UNAUDITED) 1994 1993 (UNAUDITED) 1994 1993 (UNAUDITED) 1994
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RATIOS TO AVERAGE
NET ASSETS:
Expenses .36%(1) .36% .36%(1) .47%(1) .40% .42%(1) .77%(1) .82%(1)
--------------------------------------------------------------------------------------------------------------
Net Investment
Income 3.54%(1) 2.38% 2.20%(1) 4.80%(1) 4.47% 4.21%(1) 4.29%(1) 3.92%(1)
--------------------------------------------------------------------------------------------------------------
Portfolio
Turnover Rate -- -- -- 34% 127% 25% 11% 96%
--------------------------------------------------------------------------------------------------------------
Net Assets, End
of Period (in
millions) $ 139.7 $ 150.5 $ 181.8 $ 43.7 $ 51.4 $ 104.3 $ 10.5 $ 14.8
--------------------------------------------------------------------------------------------------------------
</TABLE>
1) Annualized.
51
<PAGE>
DIRECTORY
INVESTMENT MANAGER, ADMINISTRATOR,
AND DISTRIBUTOR
Neuberger&Berman Management Incorporated
605 Third Avenue 2nd Floor
New York, NY 10158-0006
800-877-9700
Institutional Services 800-366-6264
SUB-ADVISER
Neuberger&Berman, L.P.
605 Third Avenue
New York, NY 10158-3698
CUSTODIAN AND SHAREHOLDER
SERVICING AGENT
State Street Bank and Trust Company
225 Franklin Street
Boston, MA 02110
Address correspondence to:
Neuberger&Berman Funds
Boston Service Center
P.O. Box 8403
Boston, MA 02266-8403
800-225-1596
LEGAL COUNSEL
Kirkpatrick & Lockhart LLP
1800 M Street, NW
Washington, DC 20036-5891
Neuberger&Berman Management Inc., Neuberger&Berman Municipal Money Fund,
Neuberger&Berman Municipal Securities Trust, and Neuberger&Berman New York
Insured Intermediate Fund are service marks of Neuberger& Berman Management Inc.
- -C- 1995 Neuberger&Berman Management Inc.
52
<PAGE>
OFFICERS AND TRUSTEES
Stanley Egener
CHAIRMAN OF THE BOARD AND TRUSTEE
Theresa A. Havell
PRESIDENT AND TRUSTEE
John Cannon
TRUSTEE
Charles DeCarlo
TRUSTEE
Barry Hirsch
TRUSTEE
Robert A. Kavesh
TRUSTEE
Harold R. Logan
TRUSTEE
William E. Rulon
TRUSTEE
Candace L. Straight
TRUSTEE
Daniel J. Sullivan
VICE PRESIDENT
Michael J. Weiner
VICE PRESIDENT
Richard Russell
TREASURER
Claudia A. Brandon
SECRETARY
Stacy Cooper-Shugrue
ASSISTANT SECRETARY
C. Carl Randolph
ASSISTANT SECRETARY
53
<PAGE>
PORTFOLIO MANAGEMENT
Theresa A. Havell
PRESIDENT AND TRUSTEE OF NEUBERGER&BERMAN INCOME FUNDS
PRESIDENT AND TRUSTEE OF INCOME MANAGERS TRUST
MANAGER OF FIXED INCOME GROUP OF NEUBERGER&BERMAN, L.P.
Clara Del Villar
PORTFOLIO MANAGER OF NEUBERGER&BERMAN MUNICIPAL MONEY,
NEUBERGER&BERMAN MUNICIPAL SECURITIES, AND
NEUBERGER&BERMAN NEW YORK INSURED INTERMEDIATE PORTFOLIOS
54
<PAGE>
NEUBERGER&BERMAN MANAGEMENT INC.
605 THIRD AVENUE 2ND FLOOR
NEW YORK, NY 10158-0006
SHAREHOLDER SERVICES
800.877.9700
212.476.8848 FAX
INSTITUTIONAL SERVICES
800.366.6264
Statistics and projections in this report are derived from sources
deemed to be reliable but cannot be regarded as a representation of
future results of the Funds. This report is prepared for the general
information of shareholders and is not an offer of shares of the Funds.
Shares are sold only through the currently effective prospectus, which
must precede or accompany this report.
[LOGO] PRINTED ON RECYCLED PAPER
WITH SOY BASED INKS NBMFS0010495
<PAGE>
